SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report: June 11, 1998,
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(Date of earliest event reported)
Morgan Stanley Capital I Inc.
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(Exact name of registrant as specified in its charter)
Delaware 333-45467-01 13-3291626
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(State or Other (Commission (I.R.S. Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
1585 Broadway, New York, N.Y. 10036
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 761-4000
<PAGE>
Item 5. Other Events.
Attached as Exhibit 1 is the Pooling and Servicing Agreement (as defined
below) for the Morgan Stanley Capital I Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-XL1 (the "Certificates"). On June 11, 1998, Morgan
Stanley Capital I Inc. (the "Company") caused the issuance of the Certificates,
pursuant to a Pooling and Servicing Agreement dated as of June 1, 1998 (the
"Pooling and Servicing Agreement") by and among the Company, Midland Loan
Services, Inc., as master servicer, Clarion Partners, LLC, as special servicer
and State Street Bank and Trust Company, as trustee, in fourteen classes: the
Class A-1, Class A-2, Class A-3, Class X, Class B, Class C, Class D, Class E,
Class F, Class G, Class H, Class Q, Class R and Class LR Certificates.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits
Item 601(a) of
Regulation S-K
Exhibit No. Exhibit No. Description
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1 4 Pooling and Servicing Agreement
dated as of June 1, 1998.
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on behalf of the Registrant
by the undersigned thereunto duly authorized.
MORGAN STANLEY CAPITAL I INC.
By: /s/James E. Flaum
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Name: James E. Flaum
Title: Vice President
Date: June 24, 1998
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MORGAN STANLEY CAPITAL I INC.,
Depositor,
MIDLAND LOAN SERVICES, INC.,
Master Servicer,
CLARION PARTNERS, LLC,
Special Servicer,
STATE STREET BANK AND TRUST COMPANY,
Trustee
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POOLING AND SERVICING AGREEMENT
Dated as of June 1, 1998
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Commercial Mortgage Pass-Through Certificates
Series 1998-XL1
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<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms
SECTION 1.02. Certain Calculations
SECTION 1.03. Certain Constructions
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans; Assignment of Loan
Sale Agreement
SECTION 2.02. Acceptance by Custodian and the Trustee
SECTION 2.03. Representations and Warranties of the Depositor
SECTION 2.04. Representations, Warranties and Covenants of the
Master Servicer and Special Servicer
SECTION 2.05 Execution and Delivery of Certificates; Issuance of
Lower-Tier Regular Interests
SECTION 2.06. Miscellaneous REMIC and Grantor Trust Provisions
ARTICLE III
ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS
SECTION 3.01. Master Servicer to Act as Master Servicer;
Administration of the Mortgage Loans
SECTION 3.02. Liability of the Master Servicer and Special Servicer
SECTION 3.03. Collection of Certain Mortgage Loan Payments
SECTION 3.04. Collection of Taxes, Assessments and Similar Items;
Escrow Accounts
SECTION 3.05. Collection Account; Upper-Tier Distribution Account;
Lower-Tier Distribution Account; Class Q Distribution Account;
and Deferred Interest Distribution Account
SECTION 3.06. Permitted Withdrawals from the Collection Account
SECTION 3.07. Investment of Funds in the Collection Account, the REO
Account, the Borrower Accounts, and Other Accounts
SECTION 3.08. Maintenance of Insurance Policies and Errors and
Omissions and Fidelity Coverage
SECTION 3.09. Enforcement of Due-On-Sale Clauses; Assumption
Agreements; Defeasance Provisions
SECTION 3.10. Realization Upon Defaulted Mortgage Loans
SECTION 3.11. Trustee to Cooperate; Release of Mortgage Files
SECTION 3.12. Servicing Fees, Trustee Fees and Special
Servicing Compensation
SECTION 3.13. Reports to the Trustee; Collection Account Statements
SECTION 3.14. Annual Statement as to Compliance
SECTION 3.15. Annual Independent Public Accountants' Servicing Report
SECTION 3.16. Access to Certain Documentation
SECTION 3.17. Title and Management of REO Properties
SECTION 3.18. Sale of Specially Serviced Mortgage Loans and REO Properties
SECTION 3.19. Additional Obligations of the Master Servicer;
Inspections; Successor Manager
SECTION 3.20. Reports to the Securities and Exchange Commission;
Available Information
SECTION 3.21. Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts and Reserve Accounts
SECTION 3.22. Property Advances
SECTION 3.23. Appointment of Special Servicer
SECTION 3.24. Transfer of Servicing Between Master Servicer
and Special Servicer; Record Keeping
SECTION 3.25. Limitations on and Authorizations of the Master
Servicer and Special Servicer with Respect to
Specific Mortgage Loans
SECTION 3.26. Modifications
ARTICLE IV
DISTRIBUTIONS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions
SECTION 4.02. Statements to Certificateholders; Available
Information; Information Furnished to Financial
Market Publisher
SECTION 4.03. Compliance with Withholding Requirements
SECTION 4.04. REMIC Compliance
SECTION 4.05. Imposition of Tax on the Trust Fund
SECTION 4.06. Remittances; P&I Advances
SECTION 4.07. Grantor Trust Reporting
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The Certificates
SECTION 5.02. Registration, Transfer and Exchange of Certificates
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen Certificates
SECTION 5.04. Appointment of Paying Agent
SECTION 5.05. Access to Certificateholders' Names and Addresses
SECTION 5.06. Actions of Certificateholders
SECTION 5.07. Authenticating Agent
SECTION 5.08. Appointment of Custodians
ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER AND THE SPECIAL SERVICER
SECTION 6.01. Liability of the Depositor, the Master Servicer
and the Special Servicer
SECTION 6.02. Merger or Consolidation of the Master Servicer
and the Special Servicer
SECTION 6.03. Limitation on Liability of the Depositor,
the Master Servicer and Others
SECTION 6.04. Limitation on Resignation of the Master
Servicer or Special Servicer
SECTION 6.05. Rights of the Depositor and the Trustee in
Respect of the Master Servicer and Special Servicer
SECTION 6.06. Master Servicer or Special Servicer as
Owner of a Certificate
ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default
SECTION 7.02. Trustee to Act; Appointment of Successor
SECTION 7.03. Notification to Certificateholders
SECTION 7.04. Other Remedies of Trustee
SECTION 7.05. Waiver of Past Events of Default; Termination
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee
SECTION 8.02. Certain Matters Affecting the Trustee
SECTION 8.03. Trustee Not Liable for Certificates or Mortgage Loans
SECTION 8.04. Trustee May Own Certificates
SECTION 8.05. Payment of Trustee Fees and Expenses; Indemnification
SECTION 8.06. Eligibility Requirements for Trustee
SECTION 8.07. Resignation and Removal of the Trustee
SECTION 8.08. Successor Trustee
SECTION 8.09. Merger or Consolidation of Trustee
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee
SECTION 8.11. Representations and Warranties of the Trustee
SECTION 8.12. Massachusetts Filings
ARTICLE IX
TERMINATION; OPTIONAL MORTGAGE LOAN PURCHASE
SECTION 9.01. Termination; Optional Mortgage Loan Purchase
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. Counterparts
SECTION 10.02. Limitation on Rights of Certificateholders
SECTION 10.03. Governing Law
SECTION 10.04. Notices
SECTION 10.05. Severability of Provisions
SECTION 10.06. Notice to the Depositor and Each Rating Agency
SECTION 10.07. Amendment
SECTION 10.08. Confirmation of Intent
SECTION 10.09. Third-Party Beneficiaries
<PAGE>
TABLE OF EXHIBITS
Exhibit A-1 Form of Class A-1 Certificate
Exhibit A-2 Form of Class A-2 Certificate
Exhibit A-3 Form of Class A-3 Certificate
Exhibit A-4 Form of Class X Certificate
Exhibit A-5 Form of Class B Certificate
Exhibit A-6 Form of Class C Certificate
Exhibit A-7 Form of Class D Certificate
Exhibit A-8 Form of Class E Certificate
Exhibit A-9 Form of Class F Certificate
Exhibit A-10 Form of Class G Certificate
Exhibit A-11 Form of Class H Certificate
Exhibit A-12 Form of Class J Certificate
Exhibit A-13 Form of Class Q Certificate
Exhibit A-14 Form of Class R Certificate
Exhibit A-15 Form of Class LR Certificate
Exhibit B Mortgage Loan Schedule
Exhibit C-1 Form of Transferee Affidavit
Exhibit C-2 Form of Transferor Letter
Exhibit D-1 Form of Investment Representation Letter
Exhibit D-2 Form of ERISA Representation Letter
Exhibit E Form of Request for Release
Exhibit F Securities Legend
Exhibit G Loan Sale Agreement
Exhibit H Form of Summary Report
Exhibit I Form of Monthly Distribution Statement
Exhibit J Current Insurance Schedule
Exhibit K Form of Regulation S Transfer Certificate
Exhibit L Form of Transfer Certificate for Exchange or Transfer from Rule
144A Global Certificate to Regulation S Global Certificate
during the Restricted Period
Exhibit M Form of Transfer Certificate for Exchange or Transfer from Rule
144A Global Certificate to Regulation S Global Certificate
after the Restricted Period
Exhibit N Form of Transfer Certificate for Exchange or Transfer from
Regulation S Global Certificate to Rule 144A Global
Certificate
<PAGE>
Pooling and Servicing Agreement, dated as of June 1, 1998, among Morgan
Stanley Capital I Inc., as Depositor, Midland Loan Services, Inc., as Master
Servicer, Clarion Partners, LLC, as Special Servicer and State Street Bank and
Trust Company, as Trustee.
PRELIMINARY STATEMENT:
(Terms used but not defined in this Preliminary
Statement shall have the meanings
specified in Article I hereof)
The Depositor intends to sell pass-through certificates to be issued
hereunder in multiple classes which in the aggregate will evidence the entire
beneficial ownership interest in the Trust Fund consisting primarily of the
Mortgage Loans. As provided herein, the Trustee will elect that the Trust Fund,
exclusive of the Default Interest, the Class Q Distribution Account, the
Deferred Interest and the Deferred Interest Distribution Account (such portion
of the Trust Fund, the "Trust REMICs"), be treated for federal income tax
purposes as two separate real estate mortgage investment conduits (each, a
"REMIC" or, in the alternative, the "Upper-Tier REMIC" and the "Lower-Tier
REMIC," respectively). The Class A-1, Class A-2, Class A-3, Class X, Class B,
Class C, Class D, Class E, Class F, Class G, Class H and Class J Certificates
represent "regular interests" in the Upper-Tier REMIC. The Class R Certificates
constitute the sole class of "residual interests" in the Upper-Tier REMIC. The
Class LR Certificates constitute the sole class of "residual interests" in the
Lower-Tier REMIC for purposes of the REMIC Provisions. There are also ten
classes of uncertificated Lower-Tier Regular Interests issued under this
Agreement (the Class LA-1, Class LA-2, Class LA-3, Class LB, Class LC, Class LD,
Class LE, Class LF, Class LG, Class LH and Class LJ Interests), each of which
will constitute a regular interest in the Lower-Tier REMIC. All such Lower-Tier
Regular Interests will be held by the Trustee as assets of the Upper-Tier REMIC.
The parties intend that the portions of the Trust Fund representing assets of
the Grantor Trust, including the Default Interest, the Class Q Distribution
Account, the Deferred Interest and the Deferred Interest Distribution Account
will be treated as a grantor trust under Subpart E of Part 1 of Subchapter J of
the Code, that the Class Q Certificates represent pro rata undivided beneficial
interests in the portion of the Trust Fund consisting of the Default Interest,
subject to the obligation of the Trust Fund to pay Advance Interest Amounts, and
the Class Q Distribution Account, and that the Class B, Class C, Class D, Class
E, Class F, Class G, Class H and Class J Certificates represent undivided
beneficial interests in specified portions of the Trust Fund consisting of the
Deferred Interest and the Deferred Interest Distribution Account.
The following table sets forth the designation and aggregate initial
Certificate Principal Amount (or, with respect to the Class X Certificates,
aggregate initial Notional Amount) for each Class of Certificates (other than
the Class R, Class LR and Class Q Certificates).
Initial Certificate
Principal Amount or
Class Notional Amount
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Class A-1.................. $176,000,000
Class A-2.................. $102,000,000
Class A-3.................. $393,239,000
Class X (1)................ $796,229,000
Class B.................... $ 13,888,000
Class C.................... $ 46,293,000
Class D.................... $ 64,809,000
Class E.................... $ 46,292,000
Class F.................... $ 11,663,000
Class G.................... $ 30,000,000
Class H.................... $ 27,776,000
Class J.................... $ 13,888,151
(1) The initial Notional Amount of the Class X Certificates is equal to the
aggregate of the initial Certificate Principal Amounts of the Class LA-1, Class
LA-2, Class LA-3, Class LB, Class LC and Class LD Lower-Tier Regular Interests,
which corresponds to the aggregate of the initial Certificate Principal Amounts
of the Class A-1, Class A-2, Class A-3, Class B, Class C and Class D
Certificates.
The Class Q, Class R and Class LR Certificates do not have Certificate
Principal Amounts or Notional Amounts. The Certificate Principal Amount of any
Class of Certificates outstanding at any time represents the maximum amount
which holders thereof are entitled to receive as distributions allocable to
principal from the cash flow on the Mortgage Loans and the other assets in the
Trust Fund; provided, however, that in the event that amounts previously
allocated as Realized Losses to a Class of Certificates in reduction of the
Certificate Principal Amount thereof are recovered subsequent to the reduction
of the Certificate Principal Amount of such Class to zero, such Class may
receive distributions in respect of such recoveries in accordance with the
priorities set forth in Section 4.01. As of the Cut-Off Date, the Mortgage Loans
have an aggregate Stated Principal Balance equal to $925,848,151.
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer, the Special Servicer and the Trustee agree as follows:
<PAGE>
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the meanings specified in this
Article.
"Act": The Securities Act of 1933, as it may be amended from time to time.
"Additional Trust Fund Expenses": (i) Special Servicing Fees, Special
Servicing Rehabilitation Fees and Liquidation Fees, (ii) interest in respect of
unreimbursed Advances, (iii) the cost of various default-related or
unanticipated Opinions of Counsel required or permitted to be obtained in
connection with the servicing of the Mortgage Loans and the administration of
the Trust Fund, (iv) unanticipated, non-Mortgage Loan specific expenses of the
Trust Fund, including indemnities and expense reimbursements to the Trustee,
indemnities and expense reimbursements to the Master Servicer, the Special
Servicer and the Depositor and federal, state and local taxes, and tax-related
expenses, specifically payable out of the Trust Fund and (v) any other
default-related or unanticipated expense of the Trust Fund not specifically
included in the calculation of Realized Loss for which there is no corresponding
collection from a borrower.
"Advance": Any P&I Advance or Property Advance.
"Advance Interest Amount": Interest at the Advance Rate on the aggregate
amount of P&I Advances and Property Advances for which the Master Servicer, the
Special Servicer or the Trustee, as applicable, have not been reimbursed for (i)
the number of days from the date on which such Advance was made, or (ii) with
respect to P&I Advances for the Magellan Apartment Pool Loan, which Mortgage
Loan provides for a grace period, the first day after the expiration of such
grace period, and only to the extent the applicable Monthly Payment for such
Mortgage Loan is not received prior to the expiration of such grace period, in
either case through the date of reimbursement of the related Advance, less any
amount of interest previously paid on such Advance; provided, that, with respect
to a P&I Advance, in the event that the related Borrower makes payment of the
amount in respect of which such P&I Advance was made with interest at the
Default Rate, the Advance Interest Amount payable to the Master Servicer or the
Trustee shall be paid (i) first from the amount of Default Interest paid by the
Borrower and (ii) to the extent such amounts are insufficient therefor, from
amounts on deposit in the Collection Account.
"Advance Rate": A per annum rate equal to the Prime Rate (as most recently
published in the "Money Rates" section of The Wall Street Journal, New York
edition from time to time), compounded monthly as of each Master Servicer
Remittance Date.
"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. The Trustee may obtain
and rely on an Officers' Certificate of the Master Servicer, the Special
Servicer or the Depositor to determine whether any Person is an Affiliate of
such party.
"Affiliate Loan": Either of the following: (i) that certain loan made by
Secore to HHC Finance, L.P., an affiliate of the Borrower with respect to the
CenterAmerica Pool Loan having an initial principal balance of approximately
$30,000,000; and (ii) that certain loan made by Secore to Charwil Associates
Limited Partnership, an affiliate of Borrower with respect to the Charlestowne
Mall Loan having an initial principal balance of approximately $10,000,000 and
(iii) any preferred equity issued by the Borrower with respect to the Wells
Fargo Office Tower Loan.
"Affiliated Person": Any Person involved in the organization or operation
of the Depositor or an affiliate, as defined in Rule 405 of the Act, of such
Person.
"Agent Member": Members of, or participants in, the Depository.
"Agreement": This Pooling and Servicing Agreement and all amendments hereof
and supplements hereto.
"Allocated Loan Amount": With respect to each Mortgaged Property as of any
date of determination, the portion of the principal balance of the related
Mortgage Loan then allocated to such Mortgaged Property in accordance with the
terms of the applicable Mortgage or Loan Agreement; provided, that the Allocated
Loan Amount for a Mortgaged Property shall not be decreased by the amount of any
release payment made by the related Borrower with respect to any other Mortgaged
Property securing the same Mortgage Loan, to the extent the amount of the
release payment paid by such Borrower with respect to such other Mortgaged
Property is in excess of the Allocated Loan Amount for such other Mortgaged
Property.
"Annual Compliance Report": A report consisting of an annual statement of
compliance required by Section 3.14 hereof and an annual report of an
Independent accountant required pursuant to Section 3.15 hereof.
"Anticipated Termination Date": Any Distribution Date on which it is
anticipated that the Trust Fund will be terminated pursuant to Section 9.01(c).
"Applicable Monthly Payment": As defined in Section 4.06.
"Applicable Procedures": As defined in Section 5.02(c)(iv).
"Applicable State and Local Tax Law": For purposes hereof, the Applicable
State and Local Tax Law shall be (a) the tax laws of the State of New York and
the Commonwealth of Massachusetts; and (b) such other state or local tax laws
whose applicability shall have been brought to the attention of the Trustee by
either (i) an opinion of counsel delivered to it, or (ii) written notice from
the appropriate taxing authority as to the applicability of such state or local
tax laws.
"Appraisal Reduction Amount": For any Distribution Date and for any
Mortgage Loan as to which an Appraisal Reduction Event has occurred, an amount
equal to the excess, if any, of (a) the Stated Principal Balance of such
Mortgage Loan as of the last day of the related Collection Period over (b) the
excess of (i) 90% of the sum of the appraised values of the related Mortgaged
Properties as determined by Updated Appraisals obtained by the Special Servicer
(the cost of which shall be advanced by the Master Servicer as a Property
Advance) over (ii) the sum of (A) to the extent not previously advanced by the
Master Servicer or the Trustee, all unpaid interest on such Mortgage Loan at a
per annum rate equal to its Mortgage Rate, (B) all unreimbursed Advances, with
interest thereon at the Advance Rate (to the extent provided hereunder) in
respect of such Mortgage Loan and (C) all currently due and unpaid real estate
taxes, ground rents, if applicable, and assessments and insurance premiums and
all other amounts due and unpaid with respect to such Mortgage Loan (which
taxes, premiums and other amounts have not been the subject of an Advance by the
Master Servicer, or the Trustee, as applicable). If no Updated Appraisal has
been obtained within the 12 months prior to the first Distribution Date on or
after an Appraisal Reduction Event has occurred, the Special Servicer shall
estimate the value of the related Mortgaged Properties (the "Special Servicer's
Appraisal Estimate") and such estimate shall be used for purposes of determining
the Appraisal Reduction Amount for such Distribution Date. Within 60 days after
the Special Servicer receives written notice or is otherwise aware of the
Appraisal Reduction Event, the Special Servicer shall obtain an independent MAI
appraisal, the cost of which shall be paid by the Master Servicer as a Property
Advance; provided, however, that with respect to an Appraisal Reduction Event
enumerated in clause (ii) of the definition of Appraisal Reduction Event, the
Special Servicer shall obtain such appraisal no later than 120 days following
the date of the related delinquency. On the first Distribution Date occurring on
or after the delivery of such independent MAI appraisal, the Special Servicer
shall adjust the Appraisal Reduction Amount to take into account such appraisal
(regardless of whether the Updated Appraisal is higher or lower than the Special
Servicer's Appraisal Estimate). Each Appraisal Reduction Amount shall also be
adjusted with respect to the next Distribution Date to take into account any
subsequent Updated Appraisal and annual letter updates, as of the date of each
such subsequent Updated Appraisal or letter update. Upon payment in full or
liquidation of any Mortgage Loan for which an Appraisal Reduction Amount has
been determined, such Appraisal Reduction Amount shall be equal to zero.
"Appraisal Reduction Event": With respect to any Mortgage Loan, the
earliest of (i) the third anniversary of the date on which an extension of the
Maturity Date of such Mortgage Loan becomes effective as a result of a
modification of such Mortgage Loan by the Special Servicer pursuant to the terms
hereof, which extension does not change the amount of Monthly Payments on the
Mortgage Loan, (ii) 90 days after an uncured delinquency (without regard to the
application of any grace period) occurs in respect of such Mortgage Loan, (iii)
45 days after the date on which a reduction in the amount of Monthly Payments on
the Mortgage Loan, or a change in any other material economic term of the
Mortgage Loan, becomes effective as a result of a modification of such Mortgage
Loan by the Special Servicer, (iv) 30 days after a receiver in respect of the
related Mortgaged Property has been appointed, (v) immediately after a voluntary
or involuntary petition for bankruptcy has been filed by or against the related
Borrower in a court of competent jurisdiction and (vi) immediately after a
Mortgage Loan becomes an REO Mortgage Loan. The Special Servicer shall notify
the Master Servicer and the Master Servicer shall notify the Special Servicer,
as applicable, promptly upon receiving notice of the occurrence of any of the
foregoing events.
"Assignment of Leases, Rents and Profits": With respect to any Mortgaged
Property, any assignment of leases, rents and profits or similar agreement
executed by the Borrower, assigning to the mortgagee all of the income, rents
and profits derived from the ownership, operation, leasing or disposition of all
or a portion of such Mortgaged Property, in the form which was duly executed,
acknowledged and delivered, as amended, modified, renewed or extended through
the date hereof and from time to time hereafter.
"Assignment of Mortgage": An assignment of Mortgage without recourse,
notice of transfer or equivalent instrument, in recordable form, which is
sufficient under the laws of the jurisdiction in which the related Mortgaged
Property is located to reflect of record the sale of the Mortgage, which
assignment, notice of transfer or equivalent instrument may be in the form of
one or more blanket assignments covering Mortgages encumbering Mortgaged
Properties located in the same jurisdiction, if permitted by law and acceptable
for recording; provided, however, that none of the Trustee, the Custodian and
the Master Servicer shall be responsible for determining whether any assignment
is legally sufficient or in recordable form.
"Assumption Fees": Any fees collected by the Master Servicer or Special
Servicer in connection with an assumption or modification of a Mortgage Loan or
substitution of a Borrower thereunder permitted to be executed under the
provisions of this Agreement.
"Authenticating Agent": Any authenticating agent appointed by the Trustee
pursuant to Section 5.07.
"Available Funds": For a Distribution Date, the sum of (i) all Monthly
Payments, Extended Monthly Payments, Balloon Payments or other receipts on
account of principal and interest (including Unscheduled Payments and any Net
REO Proceeds transferred from an REO Account pursuant to Section 3.17(b)) on or
in respect of the Mortgage Loans received by the Master Servicer in the
Collection Period relating to such Distribution Date, (ii) all other amounts
received by the Master Servicer in such Collection Period and required to be
placed in the Collection Account pursuant to Section 3.05 allocable to such
Mortgage Loans, and including all P&I Advances made by the Master Servicer or
the Trustee, as applicable, in respect of such Distribution Date and (iii) any
late payments of the items set forth in clause (i) above received after the end
of the Collection Period relating to such Distribution Date but prior to the
related Master Servicer Remittance Date, but excluding the following:
(a) amounts permitted to be used to reimburse the Master Servicer, the
Special Servicer or the Trustee for previously unreimbursed Advances and
interest thereon as described in Section 3.06(ii);
(b) those portions of each payment of interest which represent the
applicable Servicing Fee and an amount representing any applicable Special
Servicing Compensation with respect to such Distribution Date;
(c) all amounts in the nature of late fees (subject to Section 3.12
hereof), extension fees, loan service transaction fees, demand fees, beneficiary
statement charges, Assumption Fees and similar fees, and reinvestment earnings
on Investment Accounts which the Master Servicer or the Special Servicer is
entitled to retain as additional servicing compensation;
(d) all amounts representing scheduled Monthly Payments due after the
related Due Date;
(e) that portion of Net Liquidation Proceeds, Net Insurance Proceeds or the
Repurchase Price received with respect to a Mortgage Loan which represents any
unpaid Servicing Fee, Trustee Fee and Special Servicing Compensation, to which
the Master Servicer, Trustee and the Special Servicer, respectively, are
entitled;
(f) all amounts representing expenses specifically reimbursable or payable
to the Master Servicer, the Special Servicer or the Trustee and other amounts
permitted to be retained by the Master Servicer or withdrawn by the Master
Servicer from the Collection Account to the extent expressly set forth in this
Agreement (including, without limitation, as provided in Section 3.06 and
including any indemnities provided for herein), including interest thereon as
provided in this Agreement;
(g) any interest or investment income on funds on deposit in the Collection
Account, any Lock-Box Account, any Reserve Account, any Escrow Account, any Cash
Collateral Account or any REO Account or in Permitted Investments in which such
funds may be invested;
(h) all amounts received with respect to each Mortgage Loan previously
purchased or repurchased pursuant to Sections 2.03(c), 3.18 or 9.01 during the
related Collection Period and subsequent to the date as of which the amount
required to effect such purchase or repurchase was determined;
(i) the amount reasonably determined by the Trustee to be necessary to pay
any applicable federal, state or local taxes imposed on the Upper-Tier REMIC or
the Lower-Tier REMIC under the circumstances and to the extent described in
Section 4.05;
(j) Prepayment Premiums;
(k) Default Interest; and
(l) Deferred Interest.
"Balloon Payment": With respect to any Mortgage Loan, the payment of
principal due on its stated maturity date.
"Beneficial Owner": With respect to a Global 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 Person maintaining an account with such
Depository (directly as a Depository Participant or indirectly through a
Depository Participant, in accordance with the rules of such Depository). Each
of the Trustee and the Master Servicer shall have the right to require, as a
condition to acknowledging the status of any Person as a Beneficial Owner under
this Agreement, that such Person provide evidence at its expense of its status
as a Beneficial Owner hereunder.
"Borrower": With respect to any Mortgage Loan, any obligor or obligors on
any related Note or Notes.
"Borrower Accounts": As defined in Section 3.07(a).
"Business Day": Any day other than a Saturday, a Sunday or any day on which
banking institutions in the City of New York, New York, the cities in which the
principal offices of the Master Servicer or Special Servicer are located, or the
city in which the Corporate Trust Office is located are authorized or obligated
by law, executive order or governmental decree to be closed.
"Cash Collateral Account": With respect to any Mortgaged Property, any
account or accounts created pursuant to the related Mortgage, Loan Agreement,
Cash Collateral Account Agreement or other loan document into which the Lock-Box
Account monies and/or property account monies are swept on a regular basis for
the benefit of the Trustee as successor to the related Originator. Any Cash
Collateral Account shall be beneficially owned for federal income tax purposes
by the Person who is entitled to receive all reinvestment income or gain thereon
in accordance with the terms and provisions of the related Mortgage Loan and
Section 3.07, which Person shall be taxed on all reinvestment income or gain
thereon. The Master Servicer shall be permitted to make withdrawals therefrom
for deposit into the Collection Account. To the extent not inconsistent with the
related Mortgage Loan, each such Cash Collateral Account shall be an Eligible
Account.
"Cash Collateral Account Agreement": With respect to any Mortgage Loan, the
cash collateral account agreement or similar agreement, if any, between the
Originator, the related Borrower, and the bank named as party thereto pursuant
to which the related Cash Collateral Account, if any, may have been established,
together with any "lock-box agreement" or other similar agreement entered into
pursuant to the terms of any such cash collateral account agreement or similar
agreement.
"Cash Deposit": The sum of $ 0.00 being an amount equal to all cash
payments of principal and interest received by the related Originator in respect
of the Mortgage Loans prior to or on the Closing Date that are due after the
Cut-Off Date.
"CEDEL": Citibank, N.A., as depositary for CEDEL Bank, S.A., or its
successor in such capacity.
"CenterAmerica Pool Loan": The Mortgage Loan identified as No. 2 on the
Mortgage Loan Schedule.
"Certificate": Any Class A-1, Class A-2, Class A-3, Class X, Class B, Class
C, Class D, Class E, Class F, Class G, Class H, Class J, Class Q, Class R or
Class LR Certificate issued, authenticated and delivered hereunder.
"Certificate Custodian": Initially, State Street Bank and Trust Company;
thereafter any other Certificate Custodian acceptable to the Depository and
selected by the Trustee.
"Certificate Principal Amount": With respect to any Class of Certificates
(other than the Class X, Class Q, Class R and Class LR Certificates) (a) on or
prior to the first Distribution Date, an amount equal to the aggregate initial
Certificate Principal Amount of such Class, as specified in the Preliminary
Statement hereto, and (b) as of any date of determination after the first
Distribution Date, the Certificate Principal Amount of such Class of
Certificates on the Distribution Date immediately prior to such date of
determination, after actual distributions of principal thereon and allocation of
Realized Losses thereto on such prior Distribution Date; provided that for
purposes of determining Voting Rights, the Certificate Principal Amount of each
of the Class B, Class C, Class D, Class E, Class F, Class G, Class H and Class J
Certificates shall be deemed to have been reduced by the amount of any Appraisal
Reduction Amounts notionally allocated thereto pursuant to Section 4.01(i). With
respect to any Class of Lower-Tier Regular Interest, (a) on or prior to the
first Distribution Date, an amount equal to the aggregate initial Certificate
Principal Amount of the Class of Related Certificates with respect thereto, and
(b) as of any date of determination after the first Distribution Date, the
Certificate Principal Amount of such Class on the Distribution Date immediately
prior to such date of determination, after distribution of principal thereon and
allocation of Realized Losses thereto on such prior Determination Date in
accordance with Section 4.01(a).
"Certificate Register" and "Certificate Registrar": The register maintained
and the registrar appointed pursuant to Section 5.02.
"Certificateholder": With respect to any Certificate, the Person whose name
is registered in the Certificate Register; provided, however, that, except to
the extent provided in the next proviso, solely for the purpose of giving any
consent or taking any action pursuant to this Agreement, any Certificate
beneficially owned by the Depositor, the Master Servicer, the Special Servicer,
the Trustee, a Manager of a Mortgaged Property, a Borrower or any Person known
to a Responsible Officer of the Certificate Registrar to be an Affiliate of the
Depositor, the Trustee, the Master Servicer or the Special Servicer 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 or take any such action has
been obtained; provided, however, that (i) for purposes of obtaining the consent
of Certificateholders to an amendment of this Agreement, any Certificates
beneficially owned by the Master Servicer or the Special Servicer or an
Affiliate thereof shall be deemed to be outstanding, provided, that, such
amendment does not relate to compensation of the Master Servicer or the Special
Servicer or benefit the Master Servicer or the Special Servicer (in its capacity
as such) or any Affiliate thereof (other than solely in its capacity as
Certificateholder) in any material respect, in which case such Certificate shall
be deemed not to be outstanding; and (ii) for purposes of obtaining the consent
of Certificateholders to any action proposed to be taken by the Special Servicer
with respect to a Specially Serviced Mortgage Loan, any Certificates
beneficially owned by the Master Servicer or an Affiliate thereof shall be
deemed to be outstanding, provided that the Special Servicer is not the Master
Servicer. For purposes of obtaining the consent of Certificateholders to any
action with respect to a particular Mortgage Loan proposed to be taken by the
Master Servicer or Special Servicer, any Certificates beneficially owned by the
Affiliates of the related Borrower, the related Manager, or Affiliates of the
related Manager shall not be deemed to be outstanding.
Notwithstanding the foregoing, solely for purposes of providing or
distributing any reports, statements or other information required or permitted
to be provided to a Certificateholder hereunder, a Certificateholder shall
include any Beneficial Owner, or any Person identified by a Beneficial Owner as
a prospective transferee of a Certificate beneficially owned by such Beneficial
Owner but only if the Trustee or another party hereto furnishing such report,
statement or information has been provided with the name of the Beneficial Owner
of the related Certificate or the Person identified as a prospective transferee
thereof. For purposes of the foregoing, the Depositor, the Master Servicer, the
Special Servicer, the Trustee, the Paying Agent or other such Person may rely,
without limitation, on a participant listing from the Depository or statements
furnished by a Person that on their face appear to be statements from a
participant in the Depository to such Person indicating that such Person
beneficially owns Certificates.
"Charlestowne Mall Loan": The Mortgage Loan identified as No. 8 on the
Mortgage Loan Schedule.
"Class": With respect to the Certificates, all of the Certificates bearing
the same alphabetical and numerical class designation, and with respect to the
Lower-Tier Regular Interests, each interest bearing the applicable alphabetical
and numerical designation set forth in the Preliminary Statement hereto.
"Class A Certificates": Class A-1 Certificates, the Class A-2 Certificates
and the Class A-3 Certificates.
"Class A-1 Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-1 hereto.
"Class A-1 Component": With respect to the Class X Certificates, at any
date of determination, that portion of the Notional Amount of the Class X
Certificates equal to the Certificate Principal Amount of the Class A-1
Certificates.
"Class A-1 Pass-Through Rate": A per annum rate equal to 6.220%.
"Class A-2 Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-2 hereto.
"Class A-2 Component": With respect to the Class X Certificates, at any
date of determination, that portion of the Notional Amount of the Class X
Certificates equal to the Certificate Principal Amount of the Class A-2
Certificates.
"Class A-2 Pass-Through Rate": A per annum rate equal to 6.450%; provided,
however, that in no event shall the Class A-2 Pass-Through Rate exceed the WAC
Rate on any Distribution Date.
"Class A-3 Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-3 hereto.
"Class A-3 Component": With respect to the Class X Certificates, at any
date of determination, that portion of the Notional Amount of the Class X
Certificates equal to the Certificate Principal Amount of the Class A-3
Certificates.
"Class A-3 Pass-Through Rate": A per annum rate equal to 6.480%; provided,
however, that in no event shall the Class A-3 Pass-Through Rate exceed the WAC
Rate on any Distribution Date.
"Class B Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-5 hereto.
"Class B Component": With respect to the Class X Certificates, at any date
of determination, that portion of the Notional Amount of the Class X
Certificates equal to the Certificate Principal Amount of the Class B
Certificates.
"Class B Pass-Through Rate": With respect to the initial Distribution Date,
6.479%, and thereafter, a per annum rate equal to the WAC Rate minus 0.51%.
"Class C Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-6 hereto.
"Class C Component": With respect to the Class X Certificates, at any date
of determination, that portion of the Notional Amount of the Class X
Certificates equal to the Certificate Principal Amount of the Class C
Certificates.
"Class C Pass-Through Rate": With respect to the initial Distribution Date,
6.539%, and thereafter, a per annum rate equal to the WAC Rate minus 0.45%.
"Class D Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-7 hereto.
"Class D Component": With respect to the Class X Certificates, at any date
of determination, that portion of the Notional Amount of the Class X
Certificates equal to the Certificate Principal Amount of the Class D
Certificates.
"Class D Pass-Through Rate": With respect to the initial Distribution Date,
6.609%, and thereafter, a per annum rate equal to the WAC Rate minus 0.38%.
"Class E Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-8 hereto.
"Class E Pass-Through Rate": With respect to the initial Distribution Date,
6.989%, and thereafter, a per annum rate equal to the WAC Rate.
"Class F Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-9 hereto.
"Class F Pass-Through Rate": With respect to the initial Distribution Date,
6.989%, and thereafter, a per annum rate equal to the WAC Rate.
"Class G Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-10 hereto.
"Class G Pass-Through Rate": With respect to the initial Distribution Date,
6.989%, and thereafter, a per annum rate equal to the WAC Rate.
"Class H Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-11 hereto.
"Class H Pass-Through Rate": With respect to the initial Distribution Date,
6.989%, and thereafter, a per annum rate equal to the WAC Rate.
"Class J Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-12 hereto.
"Class J Pass-Through Rate": With respect to the initial Distribution Date,
6.989%, and thereafter, a per annum rate equal to the WAC Rate.
"Class LA-1 Interest": A regular interest in the Lower-Tier REMIC entitled
to the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LA-2 Interest": A regular interest in the Lower-Tier REMIC entitled
to the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LA-3 Interest": A regular interest in the Lower-Tier REMIC entitled
to the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LB Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LC Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LD Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LE Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LF Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LG Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LH Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LJ Interest": A regular interest in the Lower-Tier REMIC entitled to
the monthly distribution payable thereto pursuant to Section 4.01(a).
"Class LR Certificate": Any Certificate executed and authenticated by the
Trustee or the Authenticating Agent in substantially the form set forth in
Exhibit A-14 hereto. The Class LR Certificates have no Pass-Through Rate,
Certificate Principal Amount or Notional Amount.
"Class Prepayment Percentage": With respect to any Class of Certificates
(other than the Class X and Residual Certificates) and any Distribution Date, a
fraction, expressed as a percentage, the numerator of which is the portion of
the Principal Distribution Amount to be distributed to the Holders of such Class
of Certificates on such Distribution Date, and the denominator of which is the
aggregate Principal Distribution Amount for such Distribution Date.
"Class Q Certificate": Any Certificate executed and authenticated by the
Trustee or the Authenticating Agent in substantially the form set forth in
Exhibit A-12 hereto and entitled to the distributions payable thereto pursuant
to Section 4.01(d). The Class Q Certificates have no Pass-Through Rate,
Certificate Principal Amount or Notional Amount. The Class Q Certificates
represent a beneficial ownership interest in the Default Interest, subject to
the obligation to pay interest on Advances.
"Class Q Distribution Account": The account or accounts created and
maintained as a separate account or accounts by the Trustee pursuant to Section
3.05(c), which shall be entitled "State Street Bank and Trust Company, as
Trustee, in trust for Holders of Morgan Stanley Capital I Inc., Commercial
Mortgage Pass-Through Certificates, Series 1998-XL1, Class Q Certificateholders,
Class Q Distribution Account" and which must be an Eligible Account. The Class Q
Distribution Account shall not be an asset of the Lower-Tier REMIC or the
Upper-Tier REMIC formed hereunder.
"Class R Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-13 hereto. The Class R Certificates have no
Pass-Through Rate, Certificate Principal Amount or Notional Amount.
"Class X Certificate": Any one of the Certificates executed and
authenticated by the Trustee or the Authenticating Agent in substantially the
form set forth in Exhibit A-4 hereto.
"Class X Notional Amount": For any date of determination, a notional
principal amount equal to the aggregate of the Certificate Principal Amounts of
the Lower-Tier Regular Interests, which corresponds to the aggregate of the
Certificate Principal Amounts of their Related Certificates, as of the preceding
Distribution Date (after giving effect to the distributions of principal and
allocations of Realized Losses on such Distribution Date) or, in the case of the
first Distribution Date, as of the Closing Date.
"Class X Pass-Through Rate": A per annum rate equal to the weighted average
of the Pass-Through Rates on the Class A-1 Component, the Class A-2 Component,
the Class A-3 Component, the Class B Component, the Class C Component and the
Class D Component (each, a "Component Pass-Through Rate"), weighted on the basis
of their respective Notional Amounts. The Pass-Through Rate on the Class A-1
Component is a per annum rate equal to the WAC Rate minus the Class A-1
Pass-Through Rate. The Pass-Through Rate on the Class A-2 Component is a per
annum rate equal to the WAC Rate minus the Class A-2 Pass-Through Rate. The
Pass-Through Rate on the Class A-3 Component is a per annum rate equal to the
WAC Rate minus the Class A-3 Pass-Through Rate. The Pass-Through Rate on the
Class B Component is a per annum rate equal to 0.51%. The Pass-Through Rate on
the Class C Component is a per annum rate equal to 0.45%. The Pass-Through Rate
on the Class D Component is a per annum rate equal to 0.38%.
"Closing Date": June 11, 1998.
"Code": The Internal Revenue Code of 1986, as amended from time to time,
any successor statute thereto, and any temporary or final regulations of the
United States Department of the Treasury promulgated pursuant thereto.
"Collection Account": The account or accounts created and maintained by the
Master Servicer pursuant to Section 3.05(a), which shall be entitled "Midland
Loan Services, Inc., in trust for State Street Bank and Trust Company, as
Trustee, in trust for Holders of Morgan Stanley Capital I Inc., Commercial
Mortgage Pass-Through Certificates, Series 1998-XL1, Collection Account" and
which must be an Eligible Account.
"Collection Period": With respect to a Distribution Date and each Mortgage
Loan, the period beginning on the day after the Due Date in the month preceding
the month in which such Distribution Date occurs (or, in the case of the
Distribution Date occurring in July, 1998, on the day after the Cut-Off Date)
and ending on the Due Date in the month in which such Distribution Date occurs.
"Commission": The Securities and Exchange Commission.
"Component": Any of the Class A-1 Component, the Class A-2 Component, the
Class A-3 Component, the Class B Component, the Class C Component and the Class
D Component.
"Component Pass-Through Rate": As set forth in the definition of Class X
Pass-Through Rate.
"Corporate Trust Office": The principal office of the Trustee located at
Two International Place - 5th Floor, Boston, MA 02110, Attention: Morgan Stanley
Capital I Inc., Series 1998-XL1-Morgan Stanley 1998-XL1, or the principal trust
office of any successor trustee qualified and appointed pursuant to Section
8.08.
"Courthouse Plaza I Loan": The Mortgage Loan identified as No. 10 on the
Mortgage Loan Schedule.
"Cross-over Date": The Distribution Date on which the Certificate Principal
Amount of each Class of Subordinate Certificates has been reduced to zero.
"Custodial Agreement": The custodial agreement, if any, from time to time
in effect between the Custodian named therein and the Trustee, as the same may
be amended or modified from time to time in accordance with the terms thereof.
"Custodian": Any Custodian appointed pursuant to Section 5.08 and, unless
the Trustee is Custodian, named pursuant to any Custodial Agreement. The
Custodian may (but need not) be the Trustee or the Master Servicer or any
Affiliate of the Trustee or the Master Servicer, but may not be the Depositor or
any Affiliate thereof.
"Cut-Off Date": June 1, 1998.
"Default Interest": With respect to any Mortgage Loan, interest accrued on
such Mortgage Loan at the excess of the related Default Rate over the sum of the
related Mortgage Rate plus, if applicable, the Excess Rate for such Mortgage
Loan. The Default Interest shall not be an asset of the Lower-Tier REMIC or the
Upper-Tier REMIC formed hereunder.
"Default Rate": With respect to each Mortgage Loan, the per annum rate at
which interest accrues on such Mortgage Loan following any event of default on
such Mortgage Loan, including a default in the payment of a Monthly Payment, as
such rate is set forth on the Mortgage Loan Schedule.
"Deferred Interest": With respect to each Mortgage Loan, interest accrued
on such Mortgage Loan at the related Excess Rate plus interest thereon to the
extent permitted by applicable law at the related Revised Mortgage Rate.
Deferred Interest shall not be an asset of the Lower-Tier REMIC or the
Upper-Tier REMIC formed hereunder.
"Deferred Interest Distribution Account": The trust account or accounts
created and maintained as a separate account or accounts by the Trustee pursuant
to Section 3.05(d), which shall be entitled "State Street Bank and Trust
Company, as Trustee, in trust for Holders of Morgan Stanley Capital I Inc.,
Commercial Mortgage Pass-Through Certificates, Series 1998-XL1, Deferred
Interest Distribution Account" and which must be an Eligible Account. The
Deferred Interest Distribution Account shall not be an asset of the Lower-Tier
REMIC or the Upper-Tier REMIC formed hereunder.
"Deferred Interest Distribution Percentage": 5% with respect to the Class B
Certificates, 7% with respect to the Class C Certificates, 9% with respect to
the Class D Certificates, 15% with respect to the Class E Certificates, 15% with
respect to the Class F Certificates, 15% with respect to the Class G
Certificates, 17% with respect to the Class H Certificates and 17% with respect
to the Class J Certificates.
"Denomination": As defined in Section 5.01.
"Depositor": Morgan Stanley Capital I Inc., a Delaware corporation, and its
successors and assigns.
"Depository": The Depository Trust Company or a successor appointed by the
Certificate Registrar (which appointment shall be at the direction of the
Depositor if the Depositor is legally able to do so).
"Depository Participant": A Person for whom, from time to time, the
Depository effects book-entry transfers and pledges of securities deposited with
the Depository.
"Directing Class": Certificateholders representing 100% of the Percentage
Interests of the most subordinate Class of Certificates then outstanding,
provided that the then current Certificate Principal Amount of such Class is
equal to at least 20% of its Certificate Principal Amount as of the Closing
Date.
"Directly Operate": With respect to any REO Property, the furnishing or
rendering of services to the tenants thereof that are not customarily provided
to tenants in connection with the rental of space "for occupancy only" within
the meaning of Treasury Regulations Section 1.512(b)-1(c)(5), the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers in the ordinary course of a trade or business or any use of
such REO Property in a trade or business conducted by the Trust Fund, or the
performance of any construction work on the REO Property (other than the
completion of a building or improvement, where more than 10 percent of the
construction of such building or improvement was completed before default became
imminent), other than through an Independent Contractor; provided, however, that
the Special Servicer, on behalf of the Trust Fund, shall not be considered to
Directly Operate an REO Property solely because the Special Servicer, on behalf
of the Trust Fund, 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 or takes other actions
consistent with Section 1.856-4(b)(5)(ii) of the regulations of the United
States Department of the Treasury.
"Discount Rate": The rate which, when compounded monthly, is equivalent to
the Treasury Rate when compounded semi-annually.
"Disqualified Non-U.S. Person": With respect to a Class R or Class LR
Certificate, any Non-U.S. Person or agent thereof other than (i) a Non-U.S.
Person that holds the Class R or Class LR Certificate in connection with the
conduct of a trade or business within the United States and has furnished the
transferor and the Certificate Registrar with an effective IRS Form 4224 or (ii)
a Non-U.S. Person that has delivered to both the transferor and the Certificate
Registrar an opinion of a nationally recognized tax counsel to the effect that
the transfer of the Class R or Class LR Certificate to it is in accordance with
the requirements of the Code and the regulations promulgated thereunder and that
such transfer of the Class R or Class LR Certificate will not be disregarded for
federal income tax purposes.
"Disqualified Organization": Either (a) the United States, a State or any
political subdivision thereof, any possession of the United States, or any
agency or instrumentality of any of the foregoing (other than an instrumentality
that is a corporation if all of its activities are subject to tax and a majority
of its board of directors is not selected by any such governmental unit), (b) a
foreign government, International Organization or agency or instrumentality of
either of the foregoing, (c) an organization that is exempt from tax imposed by
Chapter 1 of the Code (including the tax imposed by Code Section 511 on
unrelated business taxable income) on any excess inclusions (as defined in Code
Section 860E(c)(1)) with respect to the Class R or Class LR Certificates (except
certain farmers' cooperatives described in Code Section 521), (d) rural electric
and telephone cooperatives described in Code Section 1381(a)(2), or (e) any
other Person so designated by the Certificate Registrar based upon an Opinion of
Counsel to the effect that any Transfer to such Person may cause the Upper-Tier
REMIC or Lower-Tier REMIC to be subject to tax or to fail to qualify as a REMIC
at any time that the Certificates are outstanding. The terms "United States,"
"State" and "International Organization" shall have the meanings set forth in
Code Section 7701 or successor provisions.
"Distribution Date": The third Business Day of each month, commencing in
July, 1998.
"Due Date": With respect to any Mortgage Loan, the first day of each month,
and with respect to any Distribution Date, the Due Date occurring in the month
in which such Distribution Date occurs.
"Early Termination Notice Date": Any date as of which the aggregate Stated
Principal Balance of the Mortgage Loans is less than 1.0% of the sum of the
aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-Off Date.
"Effective Maturity Date": With respect to each Mortgage Loan, the date set
forth below opposite such Mortgage Loan:
Hotel Del Coronado Loan January 1, 2008
CenterAmerica Pool Loan June 1, 2008
Wells Fargo Office Tower Loan April 30, 2005
West Town Mall Loan May 1, 2008
Magellan Apartment Pool Loan November 1, 2007
Glenborough Pool Loan October 1, 2007
EQR Apartment Pool Loan April 1, 2008
Charlestowne Mall Loan March 1, 2005
Ramco-Gershenson Pool Loan December 1, 2007
Courthouse Plaza I Loan January 1, 2008
Quail Springs Mall Loan June 1, 2008
"Eligible Account": Either (i) an account or accounts (A) maintained with
either a federal or state chartered depository institution or trust company (x)
if the deposits are to be held in such account 30 days or more, the long-term
unsecured debt obligations of which are rated by each of the Rating Agencies in
one of its two highest rating categories (without regard to pluses or minuses)
at all times, or (y) if the deposits are to be held in such account less than 30
days, the short-term unsecured debt obligations or commercial paper of which are
rated by S&P in one of its two highest rating categories at all times and rated
F-1+ by Fitch or (B) if the obligations of any such institution are not rated by
any one or more Rating Agencies, or if they are rated in a category lower than
required herein, as to which the Master Servicer or the Trustee, as applicable,
has received written confirmation from each such Rating Agency that holding
funds in such account would not cause such Rating Agency to qualify, withdraw or
downgrade any of its ratings on the Certificates or (ii) a segregated trust
account or accounts maintained with the corporate trust department of a federal
depository institution or state chartered depository institution or trust
company which is subject to regulations regarding fiduciary funds on deposit
substantially similar to 12 C.F.R. ss. 9.10(b), which, in each case, has
corporate trust powers, acting in its fiduciary capacity, or (iii) any other
account that, as evidenced by a written confirmation from each Rating Agency,
would not, in and of itself, cause a downgrade, qualification or withdrawal of
the then current ratings assigned to the Certificates, which may be an account
maintained with the Trustee or the Master Servicer.
"Eligible Investor": Any of (i) a Qualified Institutional Buyer that is
purchasing for its own account or for the account of a Qualified Institutional
Buyer to whom notice is given that the offer, sale or transfer is being made in
reliance on Rule 144A, or (ii) an Institutional Accredited Investor.
"Environmental Report": The environmental audit report or reports with
respect to each Mortgaged Property delivered to the related Originator in
connection with the origination of the related Mortgage Loan.
"EQR Apartment Pool Loan": The Mortgage Loan identified as No. 7 on the
Mortgage Loan Schedule.
"ERISA": The Employee Retirement Income Security Act of 1974, as it may be
amended from time to time.
"Escrow Account": As defined in Section 3.04(b).
"Escrow Payment": Any payment made by any Borrower to the Master Servicer
pursuant to the related Mortgage, Lock-Box Agreement, Cash Collateral Account
Agreement, or Loan Agreement for the account of such Borrower for application
toward the payment of taxes, insurance premiums, assessments, ground rents and
similar items in respect of the related Mortgaged Property.
"Euroclear": Morgan Guaranty Trust Company of New York, Brussels Office, as
operator of the Euroclear System, or its successor in such capacity.
"Event of Default": A Master Servicer Event of Default or Special Servicer
Event of Default, as applicable.
"Excess Prepayment Interest Shortfall": With respect to any Distribution
Date, the aggregate amount by which the Prepayment Interest Shortfall with
respect to all Principal Prepayments received during the related Collection
Period exceeds the aggregate Servicing Fee (minus the sum of (i) Trustee Fee,
(ii) in the case where such Prepayment Interest Shortfall is the result of a
prepayment on the Glenborough Pool Loan, the monthly pro-rated amount of the
annual surveillance fees allocable to the Glenborough Pool Loan and (iii) the
servicing fees of each of the Initial Sub-servicers for such Distribution Date
as reduced by the amount of any Prepayment Interest Shortfall with respect to
any of the Mortgage Loans subserviced by such Initial Sub-servicer) available to
be paid to the Master Servicer for such Distribution Date.
"Excess Rate": With respect to each Mortgage Loan, the excess of the
related Revised Mortgage Rate over the related Mortgage Rate, each as set forth
in the Mortgage Loan Schedule.
"Exchange Act": The Securities Exchange Act of 1934, as amended.
"Exchange Act Report": A Form 8-K, Form 10-K, Form 10-Q or Form 12b-25 to
be filed with the Commission, under cover of the related form required by the
Exchange Act.
"Extended Monthly Payment": With respect to any extension of a Mortgage
Loan as to which any principal balance and accrued interest remains unpaid on
its Maturity Date (such unpaid amount, a "Balance"), an amount equal to (a) a
deemed principal portion of a revised monthly payment (which will be calculated
based on an amortization schedule which would fully amortize the applicable
Balance over a term that does not extend past the date occurring two years prior
to the Rated Final Distribution Date (commencing on the Maturity Date of such
Mortgage Loan) and an interest rate no less than the Mortgage Rate with respect
to such Mortgage Loan), and (b) interest at the applicable Default Rate;
provided, however, that the Special Servicer may agree that the Extended Monthly
Payments may include interest at a rate lower than the related Default Rate
(but, except as otherwise provided herein, not lower than the related Mortgage
Rate).
"FDIC": The Federal Deposit Insurance Corporation, or any successor
thereto.
"FHLMC": The Federal Home Loan Mortgage Corporation, or any successor
thereto.
"Final Recovery Determination": With respect to any Specially Serviced
Mortgage Loan or any Mortgage Loan subject to repurchase by MSMC pursuant to
Section 2.03(c), the recovery of all Insurance Proceeds, Liquidation Proceeds,
the related Repurchase Price and other payments or recoveries (including
proceeds of the final sale of any REO Property) which the Master Servicer (or in
the case of a Specially Serviced Mortgage Loan, the Special Servicer), in its
reasonable judgment as evidenced by a certificate of a Servicing Officer
delivered to the Trustee and the Custodian (and the Master Servicer, if the
certificate is from the Special Servicer), expects to be finally recoverable.
The Master Servicer shall maintain records, prepared by a Servicing Officer, of
each Final Recovery Determination until the earlier of (i) its termination as
Master Servicer hereunder and the transfer of such records to a successor Master
Servicer and (ii) five years following the termination of the Trust Fund.
"Financial Market Publisher": Bloomberg Financial Service.
"Financial Report": A Form 8-K including as exhibits under Item 7 of Form
8-K the financial statements and other financial information required to be
filed as described in Sections 3.20 and 4.02.
"Fitch": Fitch IBCA, Inc., or its successor in interest.
"Fixed Voting Rights Percentage": As defined in the definition of "Voting
Rights."
"FNMA": The Federal National Mortgage Association, or any successor
thereto.
"Form 8-K": A Current Report on Form 8-K under the Exchange Act, or such
successor form as the Commission may specify from time to time.
"Form 10-K": An Annual Report on Form 10-K under the Exchange Act, or such
successor form as the Commission may specify from time to time.
"Form 10-Q": A Quarterly Report on Form 10-Q under the Exchange Act, or
such successor form as the Commission may specify from time to time.
"Form 12b-25": A Notification of Late Filing required by Rule 12b-25 under
the General Rules and Regulations under the Exchange Act.
"Form 15": A Form 15 in accordance with the provisions of Rule 12b-3 under
the Exchange Act, suspending the reporting obligations under the Exchange Act
set forth herein.
"Glenborough Pool Loan": The Mortgage Loan identified as No. 6 on the
Mortgage Loan Schedule.
"Global Certificates": The Class A-1, Class A-2, Class A-3, Class B, Class
C, Class D, Class E, Class F, Class G, Class H, Class J and Class X
Certificates.
"Grantor Trust": A segregated asset pool within the Trust Fund consisting
of the Default Interest, Deferred Interest and amounts held from time to time in
the Class Q Distribution Account and the Deferred Interest Distribution Account.
"Hazardous Materials": Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including, without limitation, those so
identified pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act, 42 U.S.C. Section 9601 et seq., or any other environmental
laws now or hereafter existing, and specifically including, without limitation,
asbestos and asbestos-containing materials, polychlorinated biphenyls, 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.
"Holder": With respect to any Certificate, a Certificateholder; with
respect to any Lower-Tier Regular Interest, the Trustee.
"Hotel Del Coronado Loan": The Mortgage Loan identified as No. 1 on the
Mortgage Loan Schedule.
"Indemnified Party": As defined in Section 8.05(c).
"Indemnifying Party": As defined in Section 8.05(c).
"Independent": When used with respect to any specified Person, any such
Person who (i) does not have any direct financial interest, or any material
indirect financial interest, in any of the Depositor, the Trustee, the Master
Servicer, the Special Servicer, any Borrower or any Affiliate thereof, and (ii)
is not connected with any such Person as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions.
"Independent Contractor": Either (i) any Person that would be an
"independent contractor" with respect to the Trust Fund within the meaning of
Section 856(d)(3) of the Code if the Trust Fund were a real estate investment
trust (except that the ownership tests 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 or 35% or more of the aggregate value of all Classes of
Certificates), provided that the Trust Fund does not receive or derive any
income from such Person and the relationship between such Person and the Trust
Fund is at arm's length, all within the meaning of Treasury Regulations Section
1.856-4(b)(5) (except neither the Master Servicer nor the Special Servicer shall
be considered to be an Independent Contractor under the definition in this
clause (i) unless an Opinion of Counsel (at the expense of the party seeking to
be deemed an Independent Contractor) addressed to the Special Servicer and the
Trustee has been delivered to the Trustee to that effect) or (ii) any other
Person (including the Master Servicer and the Special Servicer) if the Special
Servicer, on behalf of itself and the Trustee, has received an Opinion of
Counsel (at the expense of the party seeking to be deemed an Independent
Contractor) 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 (determined without regard to the
exception applicable for purposes of Section 860D(a) of the Code) or cause any
income realized in respect of such REO Property to fail to qualify as Rents from
Real Property (provided that such income would otherwise so qualify).
"Individual Certificate": Any Certificate in definitive, fully registered
form without interest coupons.
"Initial Sub-servicers": Each of Wells Fargo Bank, National Association
with respect to the Wells Fargo Office Tower Loan and Glenborough Pool and
AMRESCO Services, L.P. with respect to the Hotel Del Coronado Loan and the
Ramco-Gershenson Pool Loan, or each of their respective successors in interest
or any successor appointed in accordance with the terms of the related
Sub-servicing Agreement.
"Institutional Accredited Investor": An entity meeting the requirements of
Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated under the Act, or an
entity in which all the equity owners meet such requirements.
"Insurance Proceeds": Proceeds of any fire and hazard insurance policy,
title policy or other insurance policy relating to a Mortgage Loan (including
any amounts paid by the Master Servicer or the Special Servicer pursuant to
Section 3.08).
"Interest Accrual Amount": With respect to any Distribution Date and any
Class of Principal Balance Certificates, an amount equal to interest for the
related Interest Accrual Period at the Pass-Through Rate for such Class on the
related Certificate Principal Amount (provided, that for interest accrual
purposes any distributions in reduction of Certificate Principal Amount or
reductions in Certificate Principal Amount as a result of allocations of
Realized Losses on the Distribution Date occurring in an Interest Accrual Period
shall be deemed to have been made on the first day of such Interest Accrual
Period). With respect to any Distribution Date and the Class X Certificates, an
amount equal to interest for the related Interest Accrual Period at the
Pass-Through Rate for such Class for such Interest Accrual Period on the
Notional Amount of such Class (provided, that for interest accrual purposes any
distributions in reduction of Notional Amount or reductions in Notional Amount
as a result of allocations of Realized Losses on the Distribution Date occurring
in an Interest Accrual Period shall be deemed to have been made on the first day
of such Interest Accrual Period). Calculations of interest due in respect of the
Regular Certificates shall be made on the basis of a 360-day year consisting of
twelve 30-day months.
"Interest Accrual Period": With respect to any Distribution Date and with
respect to each Class of Certificates, the calendar month preceding the month in
which such Distribution Date occurs. Each Interest Accrual Period is assumed to
consist of 30 days.
"Interest Distribution Amount": With respect to any Distribution Date and
each Class of Regular Certificates, an amount equal to (A) the sum of (i) the
Interest Accrual Amount for such Distribution Date and (ii) the Interest
Shortfall, if any, for such Distribution Date, less (B) any Excess Prepayment
Interest Shortfall allocated to such Class on such Distribution Date pursuant to
Section 4.01(f).
"Interest Shortfall": With respect to any Distribution Date for any Class
of Regular Certificates, the sum of (a) the excess, if any, of (i) the Interest
Distribution Amount for such Class for the immediately preceding Distribution
Date, over (ii) all distributions of interest (other than Deferred Interest)
made with respect to such Class on the immediately preceding Distribution Date,
and (b) to the extent permitted by applicable law, (i) other than in the case of
the Class X Certificates, one month's interest on any such excess at the
Pass-Through Rate applicable to such Class for the current Distribution Date and
(ii) in the case of the Class X Certificates, one month's interest on any such
excess at the WAC Rate for such Distribution Date.
"Interested Person": As of any date of determination, the Depositor, the
Master Servicer, the Special Servicer, the Trustee, any Borrower, any manager of
a Mortgaged Property, any Independent Contractor engaged by the Special Servicer
pursuant to Section 3.17, or any Person known to a Responsible Officer of the
Trustee to be an Affiliate of any of them.
"Investment Account": As defined in Section 3.07(a).
"Investment Representation Letter": As defined in Section 5.02(c)(i)(A).
"IRS": The Internal Revenue Service.
"Liquidation Expenses": Expenses incurred by the Master Servicer, the
Special Servicer, and the Trustee in connection with the liquidation of any
Mortgage Loan or property acquired in respect thereof (including, without
limitation, legal fees and expenses, committee or referee fees, and, if
applicable, brokerage commissions, and conveyance taxes) and any Property
Protection Expenses incurred with respect to such Mortgage Loan or such property
including interest on the related Property Advances at the Advance Rate not
previously reimbursed from collections or other proceeds therefrom.
"Liquidation Fee": With respect to any Mortgage Loan or REO Property which
is sold or transferred or otherwise liquidated, an amount equal to 1.00% (or,
with respect to any Mortgage Loan acquired by the Special Servicer pursuant to
Section 3.18(a), 0.50%) of the amount equal to (a) the Liquidation Proceeds of
such Mortgage Loan or REO Property (other than any such proceeds specified in
clause (i) of the definition of Liquidation Proceeds) minus (b) any broker's
commission and related brokerage referral fees.
"Liquidation Proceeds": The amount (other than Insurance Proceeds) received
in connection with (i) the taking of a Mortgaged Property (or portion thereof)
by exercise of the power of eminent domain or condemnation, (ii) the liquidation
of a Specially Serviced Mortgage Loan through a trustee's sale, foreclosure sale
or otherwise or (iii) a sale of a Mortgage Loan or an REO Property in accordance
with Section 3.18 or Section 9.01.
"Loan Agreement": With respect to any Mortgage Loan, the loan agreement, if
any, between the related Originator and the Borrower, pursuant to which such
Mortgage Loan was made.
"Loan Documents": With respect to any Mortgage Loan, the documents executed
or delivered in connection with the origination of such Mortgage Loan or
subsequently added to the related Mortgage File.
"Loan Number": With respect to any Mortgage Loan, the loan number by which
such Mortgage Loan was identified on the books and records of the Depositor or
any sub-servicer for the Depositor, as set forth in the Mortgage Loan Schedule.
"Loan Sale Agreement": The Loan Sale Agreement, dated as of the Cut-Off
Date, by and between the Depositor and MSMC, a copy of which is attached hereto
as Exhibit G.
"Lock-Box Account": With respect to any Mortgaged Property, if applicable,
any account created pursuant to any documents relating to a Mortgage Loan to
receive rental or other income generated by the Mortgaged Property. Any Lock-Box
Account shall be beneficially owned for federal income tax purposes by the
Person who is entitled to receive the reinvestment income or gain thereon in
accordance with the terms and provisions of the related Mortgage Loan and
Section 3.07, which Person shall be taxed on all reinvestment income or gain
thereon. With respect to any Mortgage Loan as to which there is a Lock-Box
Account but not a separate Cash Collateral Account, (i) the Master Servicer
shall be permitted to make withdrawals from the related Lock-Box Account for
deposit into the Collection Account and (ii) to the extent not inconsistent with
the related Mortgage Loan, each such Lock-Box Account shall be an Eligible
Account.
"Lock-Box Agreement": With respect to any Mortgage Loan, the lock-box or
other similar agreement, if any, between the related Originator and the
Borrower, pursuant to which the related Lock-Box Account, if any, may have been
established.
"Lock-out Period": With respect to any Mortgage Loan, the period of time,
if any, specified in the related Loan Documents during which voluntary
prepayments by the related Borrower are prohibited.
"Lower-Tier Distribution Account": The account or accounts created and
maintained as a separate account or accounts by the Trustee pursuant to Section
3.05(b), which shall be entitled "State Street Bank and Trust Company, as
Trustee, in trust for Holders of Morgan Stanley Capital I Inc., Commercial
Mortgage Pass-Through Certificates, Series 1998-XL1, Lower-Tier Distribution
Account" and which must be an Eligible Account.
"Lower-Tier Regular Interests": The Class LA-1, Class LA-2, Class LA-3,
Class LB, Class LC, Class LD, Class LE, Class LF, Class LG, Class LH and Class
LJ Interests.
"Lower-Tier REMIC": A segregated asset pool within the Trust Fund
consisting of the Mortgage Loans (exclusive of Default Interest and Deferred
Interest), collections thereon, any REO Property acquired in respect thereof and
all proceeds of such REO Property, other property of the Trust Fund related
thereto, and amounts held in respect thereof from time to time in the Collection
Account and the Lower-Tier Distribution Account.
"Magellan Apartment Pool Loan": The Mortgage Loan identified as No. 5 on
the Mortgage Loan Schedule.
"MAI": Member of the Appraisal Institute.
"Management Agreement": With respect to any Mortgage Loan, any management
agreement, by and between any Manager with respect to any related Mortgaged
Property and the related Borrower, or any successor management agreement between
such parties.
"Manager": With respect to any Mortgage Loan, any property manager or
property managers for the related Mortgaged Property or Mortgaged Properties.
"Master Servicer": Midland Loan Services, Inc., a Delaware corporation or
its successor in interest, or any successor Master Servicer appointed as herein
provided.
"Master Servicer Event of Default": As defined in Section 7.01(a).
"Master Servicer Remittance Date": With respect to any Distribution Date,
the Business Day immediately preceding such Distribution Date.
"Master Servicer Remittance Report": A report prepared by the Master
Servicer in such media as may be agreed upon by the Master Servicer and the
Trustee containing such information regarding the Mortgage Loans as will permit
the Trustee to calculate the amounts to be distributed pursuant to Section 4.01
and to furnish statements to Certificateholders pursuant to Section 4.02 and
containing such additional information as the Master Servicer and the Trustee
may from time to time agree.
"Maturity Date": With respect to each Mortgage Loan, the maturity date as
set forth on the Mortgage Loan Schedule.
"Monthly Distribution Statement": As defined in Section 4.02(a).
"Monthly Payment": With respect to any Mortgage Loan (other than any REO
Mortgage Loan) and any Due Date, the scheduled monthly payment of principal (if
any) and interest at the related Mortgage Rate, which is payable by the related
Borrower on such Due Date under the related Note or Notes, but not including any
Balloon Payment. The Monthly Payment with respect to (i) an REO Mortgage Loan,
or (ii) any Mortgage Loan which is delinquent at its maturity date and with
respect to which the Special Servicer does not enter into an extension, is the
monthly payment that would otherwise have been payable on the related Due Date
had the related Note not been discharged or the related maturity date had not
been reached, as the case may be, determined as set forth in the preceding
sentence and on the assumption that all other amounts, if any, due thereunder
are paid when due.
"Mortgage": The mortgage, deed of trust or other instrument creating a
first lien on or first priority ownership interest in a Mortgaged Property
securing a Note.
"Mortgage File": With respect to any Mortgage Loan, the mortgage documents
listed in Section 2.01(i) through (xvi) pertaining to such particular Mortgage
Loan and any additional documents required to be added to such Mortgage File
pursuant to the express provisions of this Agreement.
"Mortgage Loan": Each of the mortgage loans transferred and assigned to the
Trustee pursuant to Section 2.01 and from time to time held in the Trust Fund,
the mortgage loans originally so transferred, assigned and held being identified
on the Mortgage Loan Schedule as of the Cut-Off Date. Such term shall include
any REO Mortgage Loan or defeased Mortgage Loan.
"Mortgage Loan Schedule": The list of Mortgage Loans included in the Trust
Fund as of the Closing Date being attached hereto as Exhibit B, which list shall
set forth the following information with respect to each Mortgage Loan:
(a) the Borrower's name;
(b) the Monthly Payment in effect as of the Cut-Off Date;
(c) the Mortgage Rate (separately identifying the Default Rate, the Excess
Rate and the Revised Mortgage Rate, if any), including the interest
calculation convention (i.e., "30/360" or "actual/360");
(d) the Net Mortgage Rate in effect at the Cut-Off Date;
(e) the original principal balance;
(f) the original term to stated maturity, remaining term to stated
maturity, and Maturity Date;
(g) the original and remaining amortization terms;
(h) the Stated Principal Balance as of the Cut-Off Date;
(i) the loan-to-value ratio as of the Cut-Off Date;
(j) the applicable Servicing Fee Rate;
(k) the applicable Loan Number; and
(l) the number of Mortgaged Properties securing such Mortgage Loan.
The Mortgage Loan Schedule shall also set forth the total of the amounts
described under clauses (b) and (h) above for all of the Mortgage Loans.
"Mortgage Rate": With respect to any Mortgage Loan, the per annum rate at
which interest accrues on such Mortgage Loan as stated in the related Note, in
each case without giving effect to the Excess Rate or the Default Rate with
respect to any Mortgage Loan. Notwithstanding the foregoing, if any Mortgage
Loan does not accrue interest on the basis of a 360-day year consisting of
twelve 30-day months, then, for purposes of calculating Pass-Through Rates, the
Mortgage Rate of such Mortgage Loan for any one-month period preceding a related
Due Date shall be a per annum rate equal to the Mortgage Rate thereof multiplied
by a fraction, the numerator of which is the actual number of days in such
Interest Accrual Period and the denominator of which is 30.
"Mortgaged Property": The underlying property or in the case of a Mortgage
Loan secured by multiple properties, any one of the underlying properties,
securing a Mortgage Loan, including any REO Property, consisting of a fee simple
estate, and, with respect to certain Mortgage Loans, a leasehold estate, or both
a leasehold estate and a fee simple estate, or a leasehold estate in a portion
of the property and a fee simple estate in the remainder, in one or more parcels
of land improved by a commercial or multifamily property, together with any
personal property, fixtures, leases and other property or rights pertaining
thereto.
"MSMC": Morgan Stanley Mortgage Capital Inc., a New York corporation.
"Net Default Interest": As defined in Section 3.05(c).
"Net Insurance Proceeds": Insurance Proceeds, to the extent such proceeds
are not to be applied to the restoration of the related Mortgaged Property or
released to the Borrower in accordance with the express requirements of the
Mortgage or Note or other Loan Documents included in the Mortgage File or in
accordance with prudent and customary servicing practices.
"Net Liquidation Proceeds": The Liquidation Proceeds received with respect
to any Mortgage Loan net of the amount of (i) Liquidation Expenses incurred with
respect thereto and, (ii) with respect to proceeds received in connection with
the taking of a Mortgaged Property (or portion thereof) by the power of eminent
domain in condemnation, amounts required to be applied to the restoration or
repair of the related Mortgaged Property.
"Net Mortgage Rate": With respect to any Mortgage Loan and any Distribution
Date, the per annum rate equal to the Mortgage Rate for such Mortgage Loan minus
the related Servicing Fee Rate; provided, however, that for purposes of
calculating any Pass-Through Rate, the Net Mortgage Rate of such Mortgage Loan
shall be determined without regard to any modification, waiver or amendment of
the terms of such Mortgage Loan, whether agreed to by the Special Servicer or
resulting from bankruptcy, insolvency or similar proceeding involving the
related Borrower.
"Net REO Proceeds": With respect to each REO Property and any related REO
Mortgage Loan, REO Proceeds with respect to such REO Property or REO Mortgage
Loan net of any insurance premiums, taxes, assessments, ground rents and other
costs and expenses permitted to be paid therefrom pursuant to Section 3.17(b) of
this Agreement.
"New Lease": Any lease of REO Property entered into on behalf of the Trust
Fund, including any lease renewed or extended on behalf of the Trust Fund if the
Trust Fund has the right to renegotiate the terms of such lease.
"Non-U.S. Person": A person that is not a U.S. Person.
"Nonrecoverable Advance": Any portion of an Advance proposed to be made or
previously made which has not been previously reimbursed to the Master Servicer,
the Special Servicer or the Trustee, as applicable, and which, in the good faith
business judgment of the Master Servicer, the Special Servicer or the Trustee,
as applicable, will not or, in the case of a proposed Advance, would not be
ultimately recoverable from late payments, Insurance Proceeds, Liquidation
Proceeds and other collections on or in respect of the related Mortgage Loan.
The judgment or determination by the Master Servicer, the Special Servicer or
the Trustee that it has made a Nonrecoverable Advance or that any proposed
Advance, if made, would constitute a Nonrecoverable Advance shall be evidenced
in the case of the Master Servicer or Special Servicer, by a certificate of a
Servicing Officer delivered to the Trustee, the Depositor and, in the case of
the Special Servicer, to the Master Servicer, and in the case of the Trustee, by
a certificate of a Responsible Officer of the Trustee delivered to the
Depositor, which in each case sets forth such judgment or determination and the
procedures and considerations of the Master Servicer, Special Servicer, or
Trustee, as applicable, forming the basis of such determination (including, but
not limited to, information selected by the person making such judgment or
determination in its good faith discretion, such as related income and expense
statements, rent rolls, occupancy status, property inspections, Master Servicer,
Special Servicer or Trustee inquiries, third party engineering and environmental
reports, and an appraisal conducted by an MAI appraiser in accordance with MAI
standards or any Updated Appraisal thereof conducted within the past 12 months;
copies of such documents to be included with the certificate of a Responsible
Officer). Any determination of non-recoverability made by the Master Servicer
may be made without regard to any value determination made by the Special
Servicer other than pursuant to an Updated Appraisal. Any determination by the
Master Servicer or Special Servicer that an Advance is non-recoverable or would
be non-recoverable if made, may be conclusively relied upon by the Trustee.
"Note": With respect to any Mortgage Loan as of any date of determination,
the note or other evidence of indebtedness and/or agreements evidencing the
indebtedness of a Borrower under such Mortgage Loan, including any amendments or
modifications, or any renewal or substitution notes, as of such date.
"Notice of Termination": Any of the notices given to the Trustee by the
Master Servicer, the Depositor or any Holder of a Class LR Certificate pursuant
to Section 9.01(c).
"Notional Amount": In the case of the Class X Certificates, the Class X
Notional Amount. In the case of any Component, as set forth in the applicable
definition thereof.
"Officers' Certificate": A certificate signed by the Chairman of the Board,
the Vice Chairman of the Board, the President or a Vice President (however
denominated) and by the Treasurer, the Secretary, one of the Assistant
Treasurers or Assistant Secretaries, any Trust Officer or other officer of the
Master Servicer or the Special Servicer, as the case may be, customarily
performing functions similar to those performed by any of the above designated
officers and also with respect to a particular matter, any other officer to whom
such matter is referred because of such officer's knowledge of and familiarity
with the particular subject, or an authorized officer of the Depositor, and
delivered to the Depositor, the Trustee or the Master Servicer, as the case may
be.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be counsel for the Depositor, the Special Servicer or the Master
Servicer, as the case may be, acceptable to the Trustee, except that any opinion
of counsel relating to (a) qualification of the Upper-Tier REMIC or Lower-Tier
REMIC as a REMIC or the imposition of tax under the REMIC Provisions on any
income or property of either REMIC, (b) compliance with the REMIC Provisions
(including application of the definition of "Independent Contractor"), (c)
qualification of the Grantor Trust as a grantor trust or (d) a resignation of
the Master Servicer pursuant to Section 6.04, must be an opinion of counsel who
is Independent of the Depositor, the Special Servicer and the Master Servicer.
"Originator": Each of (i) Wells Fargo Bank, National Association with
respect to the Wells Fargo Office Tower Loan and the Glenborough Pool Loan and
(ii) Secore with respect to each other Mortgage Loan.
"Ownership Interest": Any record or beneficial interest in a Class R or
Class LR Certificate.
"P&I Advance": As to any Mortgage Loan, any advance made by the Master
Servicer, pursuant to Section 4.06(b)(iii), or by the Trustee, pursuant to
Section 4.06(e). Each reference to the payment or reimbursement of a P&I Advance
shall be deemed to include, whether or not specifically referred to but without
duplication, payment or reimbursement of interest thereon at the Advance Rate
through the date of payment or reimbursement.
"Pass-Through Rate": Each of the Class A-1 Pass-Through Rate, the Class A-2
Pass-Through Rate, the Class A-3 Pass-Through Rate, the Class X Pass-Through
Rate, the Class B Pass-Through Rate, the Class C Pass-Through Rate, the Class D
Pass-Through Rate, the Class E Pass-Through Rate, the Class F Pass-Through Rate,
the Class G Pass-Through Rate, the Class H Pass-Through Rate, the Class J
Pass-Through Rate and any of the Component Pass-Through Rates. The Class Q,
Class R and Class LR Certificates do not have Pass-Through Rates.
"Paying Agent": The paying agent appointed pursuant to Section 5.04.
"Percentage Interest": As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made with respect to the
related Class. With respect to any Certificate (except the Class Q, Class R and
Class LR Certificates), the Percentage Interest is equal to the initial
denomination of such Certificate divided by the initial Certificate Principal
Amount or Notional Amount, as applicable, of such Class of Certificates. With
respect to any Class Q, Class R or Class LR Certificate, the percentage interest
is set forth on the face thereof.
"Permitted Investments": Any one or more of the following obligations or
securities payable on demand or having a scheduled maturity on or before the
Business Day preceding the date upon which such funds are required to be drawn,
regardless of whether issued by the Depositor, the Master Servicer, the Trustee
or any of their respective Affiliates and having at all times the required
ratings, if any, provided for in this definition, unless each Rating Agency
shall have confirmed in writing to the Master Servicer that a lower rating would
not, in and of itself, result in a downgrade, qualification or withdrawal of the
then current ratings assigned to the Certificates:
(i) obligations of, or obligations fully guaranteed as to payment of
principal and interest by, the United States or any agency or
instrumentality thereof provided such obligations are backed by
the full faith and credit of the United States of America
including, without limitation, obligations of: the U.S. Treasury
(all direct or fully guaranteed obligations), the Farmers Home
Administration (certificates of beneficial ownership), the
General Services Administration (participation certificates),
the U.S. Maritime Administration (guaranteed Title XI
financing), the Small Business Administration (guaranteed
participation certificates and guaranteed pool certificates),
the U.S. Department of Housing and Urban Development (local
authority bonds) and the Washington Metropolitan Area Transit
Authority (guaranteed transit bonds); provided, however, that
the investments described in this clause must (A) have a
predetermined fixed dollar of principal due at maturity that
cannot vary or change, (B) if such investments have a variable
rate of interest, such interest rate must be tied to a single
interest rate index plus a fixed spread (if any) and must move
proportionately with that index, and (C) such investments must
not be subject to liquidation prior to their maturity;
(ii) Federal Housing Administration debentures;
(iii) obligations of the following United States government sponsored
agencies: Federal Home Loan Mortgage Corp. (debt obligations),
the Farm Credit System (consolidated systemwide bonds and
notes), the Federal Home Loan Banks (consolidated debt
obligations), the Federal National Mortgage Association (debt
obligations), the Student Loan Marketing Association (debt
obligations), the Financing Corp. (debt obligations), and the
Resolution Funding Corp. (debt obligations); provided, however,
that the investments described in this clause must (A) have a
predetermined fixed dollar amount of principal due at maturity
that cannot vary or change, (B) if such investments have a
variable rate of interest, such interest rate must be tied to a
single interest rate index plus a fixed spread (if any) and must
move proportionately with that index, and (C) such investments
must not be subject to liquidation prior to their maturity;
(iv) federal funds, unsecured certificates of deposit, time or
similar deposits, bankers' acceptances and repurchase
agreements, with maturities of not more than 365 days, of any
bank, the short term obligations of which are rated in the
highest short term rating category by each Rating Agency (or, if
permitted by the related Mortgage Loan, if not rated by S&P or
Fitch, otherwise acceptable to S&P or Fitch, as applicable, as
confirmed in writing that such investment would not, in and of
itself, result in a downgrade, qualification or withdrawal of
the then current ratings assigned to the Certificates);
provided, however, that the investments described in this clause
must (A) have a predetermined fixed dollar amount of principal
due at maturity that cannot vary or change, (B) if such
investments have a variable rate of interest, such interest rate
must be tied to a single interest rate index plus a fixed spread
(if any) and must move proportionately with that index, and (C)
such investments must not be subject to liquidation prior to
their maturity;
(v) fully Federal Deposit Insurance Corporation-insured demand and
time deposits in, or certificates of deposit of, or bankers'
acceptances issued by, any bank or trust company, savings and
loan association or savings bank, the short term obligations of
which are rated in the highest short term rating category by
each Rating Agency (or, if permitted by the related Mortgage
Loan, if not rated by S&P or Fitch, otherwise acceptable to S&P
or Fitch, as applicable, as confirmed in writing that such
investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned
to the Certificates); provided, however, that the investments
described in this clause must (A) have a predetermined fixed
dollar amount of principal due at maturity that cannot vary or
change, (B) if such investments have a variable rate of
interest, such interest rate must be tied to a single interest
rate index plus a fixed spread (if any) and must move
proportionately with that index, and (C) such investments must
not be subject to liquidation prior to their maturity;
(vi) debt obligations with maturities of not more than 365 days rated
by each Rating Agency (or, if permitted by the related Mortgage
Loan, if not rated by S&P or Fitch, otherwise acceptable to S&P
or Fitch, as applicable, as confirmed in writing that such
investment would not, in and of itself, result in a downgrade,
qualification or withdrawal of the then current ratings assigned
to the Certificates) in its highest long-term unsecured rating
category; provided, however, that the investments described in
this clause must (A) have a predetermined fixed dollar of
principal due at maturity that cannot vary or change, (B) if
such investments have a variable rate of interest, such interest
rate must be tied to a single interest rate index plus a fixed
spread (if any) and must move proportionately with that index,
and (C) such investments must not be subject to liquidation
prior to their maturity;
(vii) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand
or on a specified date not more than one year after the date of
issuance thereof) with maturities of not more than 365 days and
that is rated by each Rating Agency (or, if permitted by the
related Mortgage Loan, if not rated by S&P or Fitch, otherwise
acceptable to S&P or Fitch, as applicable, as confirmed in
writing that such investment would not, in and of itself, result
in a downgrade, qualification or withdrawal of the then current
ratings assigned to the Certificates) in its highest short-term
unsecured debt rating; provided, however, that the investments
described in this clause must (A) have a predetermined fixed
dollar of principal due at maturity that cannot vary or change,
(B) if such investments have a variable rate of interest, such
interest rate must be tied to a single interest rate index plus
a fixed spread (if any) and must move proportionately with that
index, and (C) such investments must not be subject to
liquidation prior to their maturity;
(viii) the Federated Prime Obligation Money Market Fund (the "Fund") so
long as the Fund is rated by each Rating Agency in its highest
ratings category applicable to money market funds (or, if not
rated by S&P or Fitch, otherwise acceptable to S&P or Fitch, as
applicable, as confirmed in writing that such investment would
not, in and of itself, result in a downgrade, qualification or
withdrawal of the then current ratings assigned to the
Certificates); and
(ix) any other demand, money market or time deposit, demand
obligation or any other obligation, security or investment,
provided that each Rating Agency has confirmed in writing to the
Master Servicer, Special Servicer or Trustee, as applicable,
that such investment would not, in and of itself, result in a
downgrade, qualification or withdrawal of the then current
ratings assigned to the Certificates;
provided, however, that, in each case, if the investment is rated by S&P, it
shall not have an "r" highlighter affixed to its ratings from S&P; provided
further, however, that, in the judgment of the Master Servicer, such instrument
continues to qualify as a "cash flow investment" pursuant to Code Section
860G(a)(6) earning a passive return in the nature of interest and that no
instrument or security shall be a Permitted Investment if (i) such instrument or
security evidences a right to receive only interest payments or (ii) the right
to receive principal and interest payments derived from the underlying
investment provides a yield to maturity in excess of 120% of the yield to
maturity at par of such underlying investment.
Notwithstanding the foregoing, to the extent that the Loan Documents with
respect to a particular Mortgage Loan require the funds in the related Borrower
Accounts to be invested in investments other than those itemized in clause (i)
through (ix) above, the Master Servicer shall invest the funds in such Borrower
Accounts in accordance with the terms of the related Loan Documents.
"Permitted Transferee": With respect to a Class R or Class LR Certificate,
any Person that is a Qualified Institutional Buyer other than (a) a Disqualified
Organization, (b) any other Person so designated by the Certificate Registrar
based upon an Opinion of Counsel (provided at the expense of such Person or the
Person requesting the Transfer) to the effect that the Transfer of an Ownership
Interest in any Class R or Class LR Certificate to such Person may cause the
Upper-Tier REMIC or Lower-Tier REMIC to fail to qualify as a REMIC at any time
that the Certificates are outstanding, (c) a Person that is a Disqualified
Non-U.S. Person and (d) a Plan or any Person investing the assets of a Plan.
"Person": Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Plan": As defined in Section 5.02(k).
"Prepayment Assumption": The assumption that each of the Mortgage Loans
prepays on its respective Effective Maturity Date.
"Prepayment Interest Shortfall": With respect to any Distribution Date and
any Mortgage Loan, an amount equal to the amount of any shortfall in collections
of interest, adjusted to the applicable Net Mortgage Rate, resulting from a
Principal Prepayment on such Mortgage Loan during the related Collection Period
and prior to the Due Date in such Collection Period.
"Prepayment Premium": Payments received on a Mortgage Loan as the result of
the receipt of certain Unscheduled Payments (other than an amount paid in
connection with the release of the related Mortgaged Property through
defeasance), which are intended to compensate the holder of the related Note for
prepayment.
"Principal Balance Certificates": The Class A-1, Class A-2, Class A-3,
Class B, Class C, Class D, Class E, Class F, Class G, Class H and Class J
Certificates collectively.
"Principal Distribution Amount": For any Distribution Date, the sum,
without duplication, of:
(i) the principal component of all scheduled Monthly Payments (other
than Balloon Payments) which become due on the Due Date
immediately preceding such Distribution Date (if received, or
advanced by the Master Servicer, the Special Servicer or
Trustee, in respect of such Distribution Date) with respect to
the Mortgage Loans;
(ii) the principal component of all Extended Monthly Payments due on
the related Due Date (if received, or advanced by the Master
Servicer, the Special Servicer or Trustee, in respect of such
Distribution Date) with respect to the Mortgage Loans;
(iii) the principal component of any payments (including any Balloon
Payment) on any Mortgage Loan received on or after the Maturity
Date thereof in the related Collection Period; and
(iv) the portion of Unscheduled Payments allocable to principal of
any Mortgage Loan received or applied during the related
Collection Period, net of the principal portion of any
unreimbursed P&I Advances related to such Mortgage Loan.
The principal component of the amounts set forth above shall be determined
in accordance with Section 1.02 hereof.
"Principal Prepayment": Any payment of principal made by a Borrower on a
Mortgage Loan which is received in advance of its scheduled Due Date and which
is not accompanied by an amount of interest representing the full amount of
scheduled interest due on any date or dates in any month or months subsequent to
the month of prepayment other than any amount paid in connection with the
release of the related Mortgaged Property through defeasance.
"Private Global Certificate": As defined in Section 5.01 hereof.
"Property Advance": As to any Mortgage Loan, any advance made by the Master
Servicer, Special Servicer or the Trustee in respect of Property Protection
Expenses or any expenses incurred to protect, preserve and enforce the security
for a Mortgage Loan or taxes and assessments or insurance premiums, pursuant to
Section 3.04, Section 3.08 or Section 3.22, as applicable. Each reference to the
payment or reimbursement of a Property Advance shall be deemed to include,
whether or not specifically referred to, payment or reimbursement of interest
thereon at the Advance Rate from and including the date of the making of such
Advance through and including the date of payment or reimbursement.
"Property Protection Expenses": Any costs and expenses incurred by the
Master Servicer or the Special Servicer pursuant to Sections 3.04, 3.08,
3.10(a), 3.10(b), 3.10(f), 3.10(g), 3.10(i) and 3.17(b) or indicated herein as
being a cost or expense to be advanced by the Master Servicer or the Special
Servicer, as applicable.
"Public Global Certificate": Each of the Class A-1, Class A-2, Class A-3,
Class B, Class C, Class D, Class E and Class F Certificates so long as any such
Class of Certificates is registered in the name of a nominee of the Depository.
"Quail Springs Mall Loan": The Mortgage Loan identified as No. 11 on the
Mortgage Loan Schedule.
"Qualified Institutional Buyer" or "QIB": A qualified institutional buyer
within the meaning of Rule 144A.
"Qualified Insurer": As used in Sections 3.08 and 5.08, in the case of (i)
all policies not referred to in clause (ii) below, an insurance company or
security or bonding company qualified to write the related insurance policy in
the relevant jurisdiction and whose claims paying ability is rated in one of the
two highest applicable rating categories by S&P and Fitch, and (ii) in the case
of the fidelity bond and the errors and omissions insurance required to be
maintained pursuant to Section 3.08(c), shall have a claim paying ability rated
by each Rating Agency (and if such company is not rated by Fitch, is rated A:IX
by Best's Rating Guide) no lower than two ratings categories (without regard to
pluses or minuses) lower than the highest rating of any outstanding Class of
Certificates from time to time, but in no event lower than "BBB" by Fitch and
S&P, unless in the case where such insurance is not rated by one or more Rating
Agencies or where such insurance has a claims paying ability rated by one or
more Rating Agencies in a rating category lower than required herein, each such
Rating Agency has confirmed in writing that obtaining the related insurance from
an insurance company that is not rated by such Rating Agency (subject to the
foregoing exceptions) or that has a lower claims paying ability than such
requirements shall not result, in and of itself, in a downgrade, qualification
or withdrawal of the then current ratings by such Rating Agency to any Class of
Certificates, provided that Gulf Underwriter's Insurance Company, Lexington
Insurance Company and Steadfast Insurance Company, shall be Qualified Insurers
for so long as there is no downgrade, qualification or withdrawal of the rating
of such institutions from their ratings as of the Closing Date.
"Qualified Mortgage": A Mortgage Loan that is a "qualified mortgage" within
the meaning of Code Section 860G(a)(3) of the Code (but without regard to the
rule in Treasury Regulations Section 1.860G-2(f)(2) that treats a defective
obligation as a qualified mortgage, or any substantially similar successor
provision).
"Ramco-Gershenson Pool Loan": The Mortgage Loan identified as No. 9 on the
Mortgage Loan Schedule.
"Rated Final Distribution Date": The Distribution Date occurring in June
2030.
"Rating Agency": Any of Fitch or S&P. References herein to the highest
long-term unsecured debt rating category of Fitch and S&P shall mean "AAA" and
in the case of any other rating agency shall mean such highest rating category
or better without regard to any plus or minus or numerical qualification.
"Real Property": Land or improvements thereon such as buildings or other
inherently permanent structures thereon (including items that are structural
components of the buildings or structures), in each such case as such terms are
used in the REMIC Provisions.
"Realized Loss": With respect to any Distribution Date, the amount, if any,
by which the aggregate Certificate Principal Amount of the Certificates after
giving effect to distributions on such Distribution Date exceeds the aggregate
Stated Principal Balance of the Mortgage Loans after giving effect to any
payments of principal received or advanced with respect to the Due Date
occurring immediately prior to such Distribution Date.
"Reassignment of Assignment of Leases, Rents and Profits": As defined in
Section 2.01(viii).
"Record Date": With respect to each Distribution Date and each Class of
Certificates, the close of business on the last day of the month immediately
preceding the month in which such Distribution Date occurs, or if such day is
not a Business Day, the immediately preceding Business Day.
"Regular Certificates": The Class A-1, Class A-2, Class A-3, Class X, Class
B, Class C, Class D, Class E, Class F, Class G, Class H and Class J
Certificates.
"Regulation D": Regulation D under the Act.
"Regulation S": Regulation S under the Act.
"Regulation S Global Certificate": As defined in Section 5.01.
"Regulation S Investor": With respect to a transferee of an interest in a
Regulation S Global Certificate, a transferee that acquires such interest
pursuant to Regulation S.
"Regulation S Transfer Certificate": As defined in Section 5.02(c)(i)(B).
"Related Certificate" and "Related Lower-Tier Regular Interest": For any
Class of Lower-Tier Regular Interest, the related Class of Certificates set
forth below, and for any Class of Certificates (other than the Class X, Class Q,
Class R and Class LR Certificates), the related Class of Lower-Tier Regular
Interest set forth below:
Related Lower-Tier
Related Certificate Regular Interest
------------------- ----------------
Class A-1......................... Class LA-1
Class A-2......................... Class LA-2
Class A-3......................... Class LA-3
Class B........................... Class LB
Class C........................... Class LC
Class D........................... Class LD
Class E........................... Class LE
Class F........................... Class LF
Class G........................... Class LG
Class H........................... Class LH
Class J........................... Class LJ
"REMIC": A "real estate mortgage investment conduit" within the meaning of
Section 860D of the Code.
"REMIC Provisions": Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Section 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
regulations (including any applicable proposed regulations) and rulings
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, which income, subject
to the terms and conditions of that Section of the Code in its present form,
does not include:
(i) except as provided in Section 856(d)(4) or (6) of the Code, any
amount received or accrued, directly or indirectly, with respect
to such REO Property, if the determination of such amount
depends in whole or in part on the income or profits derived by
any Person from such property (unless such amount is a fixed
percentage or percentages of receipts or sales and otherwise
constitutes Rents from Real Property);
(ii) any amount received or accrued, directly or indirectly, from any
Person if the Trust Fund owns directly or indirectly (including
by attribution) a ten percent or greater interest in such Person
determined in accordance with Sections 856(d)(2)(B) and (d)(5)
of the Code;
(iii) any amount received or accrued, directly or indirectly, with
respect to such REO Property if any Person Directly Operates
such REO Property;
(iv) any amount charged for services that are not customarily
furnished in connection with the rental of property to tenants
in buildings of a similar class in the same geographic market as
such REO Property within the meaning of Treasury Regulations
Section 1.856-4(b)(1) (whether or not such charges are
separately stated); and
(v) rent attributable to personal property unless such personal
property is leased under, or in connection with, the lease of
such REO Property and, for any taxable year of the Trust Fund,
such rent is no greater than 15 percent of the total rent
received or accrued under, or in connection with, the lease.
"REO Account": As defined in Section 3.17(b).
"REO Mortgage Loan": Any Mortgage Loan as to which the related Mortgaged
Property has become an REO Property.
"REO Proceeds": With respect to any REO Property and the related REO
Mortgage Loan, all revenues received by the Special Servicer with respect to
such REO Property or REO Mortgage Loan which do not constitute Liquidation
Proceeds.
"REO Property": A Mortgaged Property title to which has been acquired by
the Special Servicer on behalf of the Trust Fund through foreclosure, deed in
lieu of foreclosure or otherwise.
"Repurchase Price": With respect to a Mortgage Loan, the sum of:
(i) the outstanding principal balance of such Mortgage Loan as of
the date of purchase;
(ii) all accrued and unpaid interest on such Mortgage Loan at the
related Mortgage Rate, in effect from time to time, to but not
including the Due Date in the Collection Period of purchase;
(iii) all related unreimbursed Property Advances plus accrued and
unpaid interest on all related Advances at the Advance Rate (to
the extent provided hereunder), and accrued and unpaid Special
Servicing Fees allocable to such Mortgage Loan; and
(iv) all reasonable out-of-pocket expenses reasonably incurred by the
Master Servicer, the Special Servicer, the Depositor and the
Trustee in respect of the breach giving rise to the repurchase
obligation, including any expenses arising out of the
enforcement of the repurchase obligation, which are reimbursable
to such parties pursuant to the terms herein.
"Request for Release": A request for a release signed by a Servicing
Officer, substantially in the form of Exhibit E hereto.
"Reserve Accounts": With respect to any Mortgage Loan, reserve accounts, if
any, established pursuant to the Mortgage or the Loan Agreement and any Escrow
Account. Any Reserve Account shall be beneficially owned for federal income tax
purposes by the Person who is entitled to receive the reinvestment income or
gain thereon in accordance with the terms and provisions of the related Mortgage
Loan and Section 3.07, which Person shall be taxed on all reinvestment income or
gain thereon. To the extent not inconsistent with the related Mortgage Loan,
each such Reserve Account shall be an Eligible Account.
"Residual Certificates": The Class R and Class LR Certificates.
"Responsible Officer": Any officer of the Corporate Trust Department of the
Trustee (and, in the event that the Trustee is not the Certificate Registrar or
the Paying Agent, of the Certificate Registrar or the Paying Agent, as
applicable) assigned to the Corporate Trust Office with direct responsibility
for the administration of this Agreement and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such
officer's knowledge of and familiarity with the particular subject, and, in the
case of any certification required to be signed by a Responsible Officer, such
an officer whose name and specimen signature appears on a list of corporate
trust officers furnished to the Master Servicer by the Trustee, as such list may
from time to time be amended.
"Restricted Certificate": As defined in Section 5.02(k).
"Revised Mortgage Rate": With respect to any Mortgage Loan, the revised
Mortgage Rate on each such Mortgage Loan (in the absence of a default), as set
forth on the Mortgage Loan Schedule.
"Rule 144A": Rule 144A under the Act.
"Rule 144A Global Certificates": As defined in Section 5.01.
"S&P": Standard & Poor's Ratings Services, a division of The McGraw Hill
Companies, Inc.
"Scheduled Final Distribution Date": The Distribution Date occurring in
June, 2028.
"Secore": Secore Financial Corporation, a Pennsylvania corporation.
"Securities Legend": With respect to each Private Global Certificate,
Residual Certificate or any Individual Certificate, the legend set forth in, and
substantially in the form of, Exhibit F hereto.
"Servicing Fee": With respect to each Mortgage Loan and for any
Distribution Date, an amount equal to the product of (i) the related Servicing
Fee Rate (converted to a monthly rate) and (ii) the Stated Principal Balance of
such Mortgage Loan; provided, that such amounts shall be computed on the basis
of the same principal amount and, in connection with any partial interest
payment, for the same period respecting which any related interest payment due
or deemed due on the related Mortgage Loan is computed. Such amount includes the
compensation payable to the Master Servicer and the Trustee Fee. With respect to
any Distribution Date, to the extent that there are Prepayment Interest
Shortfalls with respect to Principal Prepayments received during the related
Collection Period, the Servicing Fee to which the Master Servicer would
otherwise be entitled to with respect to all the Mortgage Loans for such
Distribution Date (but not the fees payable to the Special Servicer and the
Trustee), excluding the monthly pro-rated amount of the annual Rating Agency
surveillance fees allocable to the Glenborough Pool Loan, shall be reduced (but
not below zero) up to the amount sufficient to fully offset such Prepayment
Interest Shortfalls.
"Servicing Fee Rate": A rate equal to: (a) with respect to the Glenborough
Pool Loan, 0.033% per annum; and (b) with respect to all other Mortgage Loans,
0.028% per annum.
"Servicing Officer": Any officer or employee of the Master Servicer or the
Special Servicer, as applicable, involved in, or responsible for, the
administration and servicing of the Mortgage Loans or this Agreement and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's or employee's knowledge of and familiarity
with the particular subject, and, in the case of any certification required to
be signed by a Servicing Officer, such an officer or employee whose name and
specimen signature appears on a list of servicing officers furnished to the
Trustee by the Master Servicer or the Special Servicer, as applicable, as such
list may from time to time be amended by the Master Servicer or the Special
Servicer, as applicable.
"Servicing Standard": With respect to the Master Servicer or Special
Servicer shall mean the servicing of the Mortgage Loans by the Master Servicer
or Special Servicer in the best interests of and for the sole benefit of all of
the Certificateholders (as determined by the Master Servicer or Special Servicer
as the case may be, in the exercise of its good faith and reasonable judgment)
and in accordance with applicable law, the specific terms of the respective
Mortgage Loans and this Agreement and to the extent not inconsistent with the
foregoing, in the same manner in which, and with the same care, skill and
diligence as is normal and usual in its general mortgage servicing and REO
property management activities on behalf of third parties, giving due
consideration to customary and usual standards of practice of prudent
institutional commercial mortgage lenders servicing their own loans and to the
maximization of the net present value of the Mortgage Loans, or the same care,
skill, prudence and diligence which the Master Servicer and Special Servicer
uses for loans serviced for their own account, whichever is higher, with respect
to mortgage loans and REO properties that are comparable to those for which it
is responsible hereunder, and in each event with a view to the timely collection
of all scheduled payments of principal and interest under the Mortgage Loans or,
if a Mortgage Loan comes into and continues in default and if, in the good faith
and reasonable judgment of the Special Servicer, no satisfactory arrangements
can be made for the collection of the delinquent payments, 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
collection that will be distributable to Certificateholders to be performed at
the related Net Mortgage Rate), but in any case without regard to:
(i) any known relationship that the Master Servicer, the Special
Servicer or any Affiliate of the Master Servicer or the Special
Servicer may have with any Borrower or any other parties to this
Agreement;
(ii) the ownership of any Certificate by the Master Servicer, the
Special Servicer or any Affiliate of the Master Servicer or
Special Servicer, as applicable;
(iii) the Master Servicer's or Special Servicer's obligation to make
Advances;
(iv) the right of the Master Servicer (or any Affiliate thereof) or
the Special Servicer (or any Affiliate thereof), as the case may
be, to receive reimbursement of costs, or the sufficiency of any
compensation for its services hereunder or with respect to any
particular transaction;
(v) the ownership, servicing or management for others or itself, by
the Master Servicer or the Special Servicer of any other
mortgage loans or properties; or
(vi) any obligation of the Master Servicer or Special Servicer, if it
is also an Originator, to pay any indemnity with respect to or
repurchase of any Mortgage Loan.
"Special Event Report": As defined in Section 3.20.
"Special Servicer": Clarion Partners, LLC, or any successor Special
Servicer appointed as provided herein.
"Special Servicer Event of Default": As defined in Section 7.01(b).
"Special Servicer's Appraisal Estimate": As defined in the definition of
Appraisal Reduction Amount.
"Special Servicing Compensation": With respect to any Mortgage Loan, any of
the Special Servicing Fee, the Special Servicing Rehabilitation Fee, and the
Liquidation Fee which shall be due to the Special Servicer.
"Special Servicing Fee": With respect to each Specially Serviced Mortgage
Loan and any Distribution Date, an amount per Interest Accrual Period equal to
the product of (i) one-twelfth of the Special Servicing Fee Rate and (ii) the
Stated Principal Balance of such Specially Serviced Mortgage Loan; provided,
that such amounts shall be computed on the basis of the same principal amount,
in connection with any partial interest payment, and for the same period
respecting which any related interest payment due or deemed due on the related
Mortgage Loan is computed; provided further, that such fee for the first
Interest Accrual Period shall be appropriately prorated to reflect the fact that
the first Interest Accrual Period is less than a full month.
"Special Servicing Fee Rate": A rate equal to 0.25% per annum.
"Special Servicing Rehabilitation Fee": As to any Mortgage Loan that has
been a Specially Serviced Mortgage Loan, on the occasion that such Mortgage Loan
has not been a Specially Serviced Mortgage Loan for three consecutive Collection
Periods (or 12 consecutive Collection Periods in the case of any Mortgage Loan
which became a Specially Serviced Mortgage Loan as a result of circumstances
described in clauses (iii) through (vii) of the definition thereof), an amount
equal to 1.00% of the highest Stated Principal Balance of such Mortgage Loan
while it was a Specially Serviced Mortgage Loan; provided, however, that such
Special Servicing Rehabilitation Fee shall be due only once for each Mortgage
Loan during the term of this Agreement.
"Specially Serviced Mortgage Loan": Subject to Section 3.24, any Mortgage
Loan with respect to which:
(i) the related Borrower has not made two consecutive Monthly
Payments (and has not cured at least one such Delinquency by the
next Due Date under such Mortgage Loan);
(ii) the Master Servicer or the Trustee, individually or
collectively, have made four consecutive P&I Advances
(regardless of whether such P&I Advances have been reimbursed),
other than any P&I Advance with respect to which the related
Monthly Payment was received during the related grace period
specified in the applicable Loan Documents;
(iii) the related Borrower has expressed to the Master Servicer an
inability to pay or a hardship in paying the Mortgage Loan in
accordance with its terms;
(iv) the Master Servicer has received notice that the Borrower has
become the subject of any bankruptcy, insolvency or similar
proceeding, admitted in writing the inability to pay its debts
as they come due or made an assignment for the benefit of
creditors;
(v) the Master Servicer has received notice of a foreclosure or
threatened foreclosure of any lien on the Mortgaged Property
securing the Mortgage Loan;
(vi) a default (A) of which the Master Servicer has notice (other
than a failure by the Borrower to pay principal or interest) and
(B) which materially and adversely affects the interests of the
Certificateholders has occurred, and remained unremedied for the
applicable grace period specified in the Mortgage Loan (or, if
no grace period is specified, 60 days); provided that a default
requiring a Property Advance shall be deemed to materially and
adversely affect the interests of the Certificateholders; or
(vii) in the opinion of the Master Servicer (consistent with the
Servicing Standard) a default under a Mortgage Loan is imminent
and such Mortgage Loan deserves the attention of the Special
Servicer;
provided, however, that a Mortgage Loan will cease to be a
Specially Serviced Mortgage Loan:
(a) with respect to the circumstances described in clause (i) and (ii)
above, when the Borrower thereunder has brought the Mortgage Loan current and
thereafter made three consecutive full and timely Monthly Payments including
pursuant to any workout of the Mortgage Loan;
(b) with respect to the circumstances described in clause (iii), (iv), (v)
and (vii) above, when such circumstances cease to exist in the good faith
judgment of the Master Servicer; or
(c) with respect to the circumstances described in clause (vi) above, when
such default is cured;
provided, in any case, that at that time no circumstance identified in clauses
(i) through (vii) above exists that would cause the Mortgage Loan to continue to
be characterized as a Specially Serviced Mortgage Loan.
"Startup Day": The day designated as such pursuant to Section 2.06(a)
hereof.
"Stated Principal Balance": With respect to any Mortgage Loan at any date
of determination, an amount equal to (a) the principal balance as of the Cut-Off
Date of such Mortgage Loan, minus (b) the sum of (i) the principal portion of
each Monthly Payment or, if applicable, Extended Monthly Payment due on such
Mortgage Loan after the Cut-Off Date and prior to such date of determination, if
received from the Borrower or advanced by the Master Servicer or Trustee, (ii)
all Balloon Payments, voluntary and involuntary principal prepayments and other
unscheduled collections of principal received with respect to such Mortgage
Loan, to the extent distributed to Certificateholders or applied to other
payments required under this Agreement before such date of determination and
(iii) any adjustment to the principal balance of such Mortgage Loan as a result
of a reduction of principal by a bankruptcy court or as a result of a
modification reducing the principal amount due on such Mortgage Loan. The Stated
Principal Balance of a Mortgage Loan with respect to which title to the related
Mortgaged Property has been acquired by the Trust Fund is equal to the principal
balance thereof outstanding on the date on which such title is acquired less any
Net REO Proceeds allocated to principal on such Mortgage Loan. The Stated
Principal Balance of a Specially Serviced Mortgage Loan with respect to which
the Special Servicer has made a Final Recovery Determination is zero.
"Sub-servicing Agreements": As defined in Section 3.01(c).
"Subordinate Certificates": Any of the Class B, Class C, Class D, Class E,
Class F, Class G, Class H and Class J Certificates.
"Summary Report": A quarterly report or annual summary of quarterly reports
setting forth the information with respect to the Borrowers and Mortgaged
Properties, substantially in the form of Exhibit H hereto.
"Tax Returns": The federal income tax returns on IRS Form 1066, U.S. Real
Estate Mortgage Investment Conduit Income Tax Return, including Schedule Q
thereto, Quarterly Notice to Residual Interest Holders of REMIC Taxable Income
or Net Loss Allocation, or any successor forms, to be filed on behalf of each of
the Upper-Tier REMIC or Lower-Tier 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 or any other
governmental taxing authority under any applicable provisions of federal tax
laws or Applicable State and Local Tax Laws.
"Terminated Party": As defined in Section 7.01(c).
"Termination Date": The Distribution Date on which the Trust Fund is
terminated pursuant to Section 9.01.
"Transfer": Any direct or indirect transfer or other form of assignment of
any Ownership Interest in a Class R or Class LR Certificate.
"Transferee Affidavit": As defined in Section 5.02(l)(ii).
"Transferor Letter": As defined in Section 5.02(l)(ii).
"Treasury Rate": 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 of the Mortgage
Loan prepaid. If Release H.15 is no longer published, the Trustee shall select a
comparable publication to determine the Treasury Rate.
"Trust Fund": The corpus of the trust created hereby and to be administered
hereunder, consisting of: (i) such Mortgage Loans as from time to time are
subject to this Agreement, together with the Mortgage Files relating thereto;
(ii) all scheduled or unscheduled payments on or collections in respect of the
Mortgage Loans due after the Cut-Off Date; (iii) any REO Property; (iv) all
revenues received in respect of any REO Property; (v) the Master Servicer's, the
Special Servicer's and the Trustee's rights under the insurance policies with
respect to the Mortgage Loans required to be maintained pursuant to this
Agreement and any proceeds thereof; (vi) any Assignments of Leases, Rents and
Profits and any security agreements; (vii) any indemnities or guaranties given
as additional security for any Mortgage Loans; (viii) the Trustee's rights in
all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts, Escrow
Accounts, Reserve Accounts, (ix) the Collection Account, the Lower-Tier
Distribution Account, the Upper-Tier Distribution Account, the Deferred Interest
Distribution Account, the Class Q Distribution Account and any REO Account,
including reinvestment income thereon; (x) any environmental indemnity
agreements relating to the Mortgaged Properties; (xi) the rights and remedies
under the Loan Sale Agreement; and (xii) the proceeds of any of the foregoing.
"Trust REMICs": The Lower-Tier REMIC and the Upper-Tier REMIC.
"Trustee": State Street Bank and Trust Company, a Massachusetts trust
company, in its capacity as trustee, or its successor in interest, or any
successor trustee appointed as herein provided.
"Trustee Fee": With respect to each Mortgage Loan and for any Distribution
Date, an amount per Interest Accrual Period equal to the product of (i)
one-twelfth of the Trustee Fee Rate multiplied by (ii) the Stated Principal
Balance of such Mortgage Loan; provided, that such amounts shall be computed on
the basis of the same principal amount and for the same period respecting which
any related interest payment due or deemed due on the related Mortgage Loan is
computed.
"Trustee Fee Rate": A rate equal to 0.0030% per annum.
"Underwriter": Morgan Stanley & Co. Incorporated
"Unscheduled Payments": With respect to a Mortgage Loan and a Collection
Period, all Net Liquidation Proceeds, Net Insurance Proceeds and net
condemnation proceeds payable under such Mortgage Loan, any Principal
Prepayment, any delinquent Monthly Payment received from the related Borrower
after the Master Servicer Remittance Date for the Due Date related to such
Monthly Payment, any Repurchase Price received in connection with a Mortgage
Loan repurchased from the Trust Fund pursuant to Sections 2.03, 3.18 or 9.01,
and any other payments under or with respect to such Mortgage Loan not scheduled
to be made, but excluding Prepayment Premiums, Deferred Interest, Default
Interest, and any amount paid in connection with the release of the related
Mortgaged Properties through defeasance.
"Updated Appraisal": An appraisal of a Mortgaged Property or REO Property,
as the case may be, conducted subsequent to any appraisal performed on or prior
to the Cut-Off Date and in accordance with MAI standards, the costs of which
shall be paid as a Property Advance by the Master Servicer. Updated Appraisals
shall be conducted by an Independent MAI appraiser selected by the Special
Servicer.
"Upper-Tier Distribution Account": The trust account or accounts created
and maintained as a separate trust account or accounts by the Trustee pursuant
to Section 3.05(b), which shall be entitled "State Street Bank and Trust
Company, as Trustee, in trust for Holders of Morgan Stanley Capital I Inc.,
Commercial Mortgage Pass-Through Certificates, Series 1998-XL1, Upper-Tier
Distribution Account" and which must be an Eligible Account.
"Upper-Tier REMIC": A segregated asset pool within the Trust Fund
consisting of the Lower-Tier Regular Interests and amounts held from time to
time in the Upper-Tier Distribution Account.
"U.S. Person": A person that is a citizen or resident of the United States,
a corporation, partnership (except to the extent provided in applicable Treasury
regulations), or other entity created or organized in or under the laws of the
United States or any political subdivision thereof, an estate whose income is
subject to United States federal income tax regardless of its source, or a trust
if a court within the United States is able to exercise primary supervision over
the administration of such trust, and one or more such U.S. Persons have the
authority to control all substantial decisions of such trust (or, to the extent
provided in applicable Treasury regulations, certain trusts in existence on
August 20, 1996 which are eligible to elect to be treated as U.S. Persons).
"Voting Rights": The portion of the voting rights of all of the
Certificates that is allocated to any Certificate or Class of Certificates. At
all times during the term of this Agreement, the percentage of the Voting Rights
assigned to each Class shall be (a) 0%, in the case of the Class Q, Class R and
Class LR Certificates, (b) 4%, in the case of the Class X Certificates (the
"Fixed Voting Rights Percentage"); (c) in the case of any of the Class A-1,
Class A-2, Class A-3, Class B, Class C, Class D, Class E, Class F, Class G,
Class H and Class J Certificates, a percentage equal to the product of (i) 100%
minus the Fixed Voting Rights Percentage multiplied by (ii) a fraction, the
numerator of which is equal to the aggregate outstanding Certificate Principal
Amount of any such Class (which will be reduced for this purpose by the amount
of any Appraisal Reduction Amounts notionally allocated to such Class, if
applicable) and the denominator of which is equal to the aggregate outstanding
Certificate Principal Amounts of all Classes of Certificates. The Voting Rights
of any Class of Certificates shall be allocated among Holders of Certificates of
such Class in proportion to their respective Percentage Interests. The aggregate
Voting Rights of Holders of more than one Class of Certificates shall be equal
to the sum of the products of each such Holder's Voting Rights and the
percentage of Voting Rights allocated to the related Class of Certificates. Any
Certificateholder may transfer its Voting Rights without transferring its
ownership interest in the related Certificates provided that such
Certificateholder provides notice of such transfer to the Trustee prior to the
effectiveness of such transfer.
"WAC Rate": With respect to any Distribution Date, the weighted average of
the Net Mortgage Rates in effect for the Mortgage Loans as of their Due Dates in
the month preceding the month in which such Distribution Date occurs weighted on
the basis of their respective Stated Principal Balances on such Due Date.
"Wells Fargo Office Tower Loan": The Mortgage Loan identified as No. 3 on
the Mortgage Loan Schedule.
"West Town Mall": The Mortgage Loan identified as No. 4 on the Mortgage
Loan Schedule.
<PAGE>
SECTION 1.02. Certain Calculations.
Unless otherwise specified herein, the following provisions shall apply:
(a) All calculations of interest with respect to the Mortgage Loans shall
be made in accordance with the terms of the related Note and Mortgage or, if
such documents do not specify the basis upon which interest accrues thereon, on
the basis of 30 days in each month and a 360-day year.
(b) The portion of any Insurance Proceeds and Net Liquidation Proceeds in
respect of a Mortgage Loan allocable to principal shall equal the total amount
of such proceeds minus (i) any portion thereof payable to the Master Servicer,
the Special Servicer or the Trustee pursuant to the provisions of this Agreement
and (ii) a portion thereof equal to the interest component of the Monthly
Payment or Extended Monthly Payment, as the case may be, at the related Net
Mortgage Rate from the date as to which interest was last paid by the Borrower
up to but not including the Due Date in the Collection Period in which such
proceeds are received.
(c) For purposes of distribution of Prepayment Premiums pursuant to
Sections 4.01(a)(ii) and 4.01(c) on any Distribution Date, the Class of
Lower-Tier Regular Interests or Certificates as to which any prepayment shall be
deemed to be distributed shall be determined on the assumption that the portion
of the Principal Distribution Amount paid to the Lower-Tier Regular Interests or
Certificates on such Distribution Date in respect of principal shall consist
first of scheduled payments included in the definition of Principal Distribution
Amount and second of prepayments included in such definition.
(d) Any Mortgage Loan payment is deemed to be received on the date such
payment is actually received by the Master Servicer, the Special Servicer or the
Trustee; provided, however, that for purposes of calculating distributions on
the Lower-Tier Regular Interests and the Certificates, Principal Prepayments
with respect to any Mortgage Loan are deemed to be received on the date they are
applied in accordance with Section 3.01(b) to reduce the outstanding principal
balance of such Mortgage Loan on which interest accrues.
(e) Any amounts received in respect of a Mortgage Loan as to which a
default has occurred shall be applied to Default Interest and other amounts due
on such Mortgage Loan prior to the application to late fees.
SECTION 1.03. Certain Constructions.
For purposes of this Agreement, references to the most or next most
subordinate Class of Certificates outstanding at any time shall mean the most or
next most subordinate Class of Certificates then outstanding as among the Class
A-1, Class A-2, Class A-3, Class X, Class B, Class C, Class D, Class E, Class F,
Class G, Class H and Class J Certificates; provided, however, that for purposes
of determining the most subordinate Class of Certificates, in the event that the
Class A Certificates are the only Class of Certificates outstanding (other than
the Class X, Class Q, Class LR or Class R Certificates), the Class A
Certificates and the Class X Certificates together will be treated as the most
subordinate Class of Certificates. For purposes of this Agreement, each Class of
Certificates other than the Class Q, Class LR and Class R Certificates shall be
deemed to be outstanding only to the extent its respective Certificate Principal
Amount or Notional Amount has not been reduced to zero; provided, however, that
notwithstanding the foregoing, solely for the purpose of distributing Deferred
Interest in accordance with the terms and priorities set forth in Section
4.01(e), any Class of Certificates entitled to distributions of Deferred
Interest shall continue to be deemed to be outstanding for so long as the
Mortgage Loans with respect to which such Class is entitled to distributions of
Deferred Interest received therefrom (as set forth in Section 4.01(e)) remain
outstanding. For purposes of this Agreement, the Class Q Certificates shall be
deemed to be outstanding so long as there are any Certificates outstanding and
the Class R and Class LR Certificates shall be deemed to be outstanding so long
as the Trust REMICs have not been terminated pursuant to Section 9.01.
<PAGE>
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans; Assignment of Loan Sale
Agreement.
The Depositor, concurrently with the execution and delivery hereof, does
hereby sell, transfer, assign, set over and otherwise convey to the Trustee
without recourse (except to the extent herein provided) all the right, title and
interest of the Depositor in and to the Mortgage Loans, including all rights to
payment in respect thereof, except as set forth below, and any security interest
thereunder (whether in real or personal property and whether tangible or
intangible) in favor of the Depositor, and all Reserve Accounts, Lock-Box
Accounts, Cash Collateral Accounts and all other assets included or to be
included in the Trust Fund for the benefit of the Certificateholders. Such
transfer and assignment includes all interest and principal due on or with
respect to the Mortgage Loans other than interest and principal due on or prior
to the Cut-Off Date. In connection with such transfer and assignment, the
Depositor shall make a cash deposit to the Collection Account in an amount equal
to the Cash Deposit. The Depositor, concurrently with execution and delivery
hereof, does also hereby transfer, assign, set over and otherwise convey to the
Trustee without recourse (except to the extent provided herein) all the right,
title and interest of the Depositor in, to and under the Loan Sale Agreement.
The Depositor shall cause the Reserve Accounts, Cash Collateral Accounts and
Lock-Box Accounts to be transferred to and held in the name of the Master
Servicer on behalf of the Trustee as successor to the applicable Originator.
In connection with such transfer and assignment, the Depositor shall, on or
prior to the Closing Date, deliver to, and deposit with, the Custodian (on
behalf of the Trustee), with copies to the Master Servicer and Special Servicer,
the following documents or instruments with respect to each Mortgage Loan so
assigned:
(i) the original of the Note, endorsed (such endorsement may
take the form of a note allonge) without recourse to the
order of the Trustee in the following form: "Pay to the
order of State Street Bank and Trust Company, as Trustee for
the Commercial Mortgage Pass-Through Certificates, Series
1998-XL1, without recourse" which Note and all endorsements
thereon or allonges thereto shall, unless the Mortgage Loan
was originated by the related Originator, show a complete
chain of endorsement from the related Originator to the
Trustee; provided, however, that the requirements of this
clause (i) shall be satisfied in the case of the EQR
Apartment Pool Loan by the delivery or deposit of the
original of that certain lost note affidavit dated as of
April 2, 1998;
(ii) the original recorded Mortgage or counterpart thereof
showing the related Originator as mortgagee or, if any such
original Mortgage has not been returned from the applicable
public recording office, a copy thereof certified to be a
true and complete copy of the original thereof submitted for
recording;
(iii) an executed Assignment of Mortgage that is complete and in
suitable form for recordation in the jurisdiction in which
the Mortgaged Property is located to "State Street Bank and
Trust Company, as Trustee for the Commercial Mortgage
Pass-Through Certificates, Series 1998-XL1, without
recourse";
(iv) if the related security agreement is separate from the
Mortgage, the original executed version or counterpart
thereof of such security agreement and the assignment
thereof to the Trustee;
(v) a copy of the UCC-1 financing statement, together with an
original executed UCC-2 or UCC-3 financing statement that is
complete and in a form suitable for filing, disclosing the
assignment to the Trustee of the security interest in the
personal property (if any) constituting security for
repayment of the Mortgage Loan;
(vi) the original of the Loan Agreement or counterpart thereof
relating to such Mortgage Loan, if any;
(vii) the original lender's title insurance policy (or the
original pro forma title insurance policy), together with
any endorsements thereto;
(viii) if any related Assignment of Leases, Rents and Profits is
separate from the Mortgage, the original executed version or
counterpart thereof, together with an executed reassignment
of such instrument to the Trustee (a "Reassignment of
Assignment of Leases, Rents and Profits") that is complete
and in suitable form for recordation in the jurisdiction in
which the Mortgaged Property is located (which reassignment,
however, may be included in the Assignment of Mortgage and
need not be a separate instrument);
(ix) copies of the original Environmental Reports of the
Mortgaged Properties made in connection with origination of
the Mortgage Loan, if any, and copies of the original
environmental indemnities, if any;
(x) copies of the original Management Agreements, if any, for
the Mortgaged Properties and any consents of manager;
(xi) a copy of the related ground lease, if any, as amended, for
the Mortgaged Properties, if any;
(xii) if the related assignment of contracts is separate from the
Mortgage, the original executed version of such assignment
of contracts and the assignment thereof to the Trustee;
(xiii) if any related Lock-Box Agreement or Cash Collateral
Agreement is separate from the Mortgage or Loan Agreement, a
copy thereof; with respect to the Reserve Accounts, Cash
Collateral Accounts and Lock-Box Accounts, if any, a copy of
the UCC-1 financing statements, if any, submitted for filing
with respect to the related Originator's security interest
in the Reserve Accounts, Cash Collateral Accounts and
Lock-Box Accounts and all funds contained therein (and UCC-2
or UCC-3 financing statements that are complete and in a
form suitable for filing assigning such security interest to
the Trustee on behalf of the Certificateholders);
(xiv) the originals of any letters of credit, issued in the name
of the Trustee or endorsed or accompanied by an executed
transfer certificate showing assignment to the Trustee;
(xv) any and all side amendments, modifications and supplements
to, and waivers related to, any of the foregoing; and
(xvi) any other written agreements related to the Mortgage Loan.
On or promptly following the Closing Date, the Trustee shall, to the extent
possession thereof has been delivered to it by the Depositor (or its designee),
at the expense of the Depositor, (1) submit for recording (a) each Assignment of
Mortgage referred to in Section 2.01(iii) which has not yet been submitted for
recording and (b) each Reassignment of Assignment of Leases, Rents and Profits
referred to in Section 2.01(viii) (if not otherwise included in the related
Assignment of Mortgage) which has not yet been submitted for recordation; and
(2) submit for filing each UCC-2 or UCC-3 financing statement referred to in
Section 2.01(v) or (xiii) which has not yet been submitted for filing. The
Trustee shall upon delivery promptly submit (and in no event later than 30
Business Days following the receipt of the related documents in the case of
clause 1(a) above and 60 days following the Closing Date in the case of clauses
1(b) and 2 above) for recording or filing, as the case may be, in the
appropriate public recording office, each such document. In the event that any
such document is lost or returned unrecorded because of a defect therein, the
Depositor, or the Trustee, at the request and expense of the Depositor, shall
use its best efforts to promptly prepare a substitute document for signature by
the Depositor, and thereafter the Trustee shall cause each such document to be
duly recorded. The Trustee shall, promptly upon receipt of the original recorded
copy (and in no event later than five Business Days following such receipt)
deliver such original to the Custodian. Notwithstanding anything to the contrary
contained in this Section 2.01, in those instances where the public recording
office retains the original Mortgage, Assignment of Mortgage or Reassignment of
Assignment of Leases, Rents and Profits, if applicable, after any has been
recorded, the obligations hereunder of the Depositor shall be deemed to have
been satisfied upon delivery to the Custodian of a copy of such Mortgage,
Assignment of Mortgage or Reassignment of Assignment of Leases, Rents and
Profits, if applicable, certified by the public recording office to be a true
and complete copy of the recorded original thereof. If a pro forma title
insurance policy has been delivered to the Custodian in lieu of an original
title insurance policy, the Depositor will promptly deliver to the Custodian the
related original title insurance policy upon receipt thereof. The Depositor
shall promptly cause the UCC-1's referred to in Section 2.01(v) and (xiii), if
not already filed, to be filed in the applicable public recording office and
upon filing will promptly deliver to the Custodian the related UCC-1, with
evidence of filing thereon. The Depositor shall pay all recording fees of the
Trustee and shall reimburse the Trustee for all out-of-pocket expenses incurred
and filing fees paid by the Trustee in connection with its obligations under
this paragraph. Copies of such recorded or filed documents shall be delivered to
the Master Servicer by the Depositor or the Trustee, as applicable.
All original documents relating to the Mortgage Loans which are not
delivered to the Custodian are and shall be held by the Depositor, the Trustee
or the Master Servicer, as the case may be, in trust for the benefit of the
Certificateholders. In the event that any such original document is required
pursuant to the terms of this Section to be a part of a Mortgage File, such
document shall be delivered promptly to the Custodian.
SECTION 2.02. Acceptance by Custodian and the Trustee.
If the Depositor cannot deliver any original or certified recorded document
described in Section 2.01 on the Closing Date, the Depositor shall use its best
efforts, promptly upon receipt thereof and in any case not later than 45 days
from the Closing Date, to deliver such original or certified recorded documents
to the Custodian (unless the Depositor 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 Custodian and the
Trustee in writing of such delay and shall deliver such documents to the
Custodian promptly upon the Depositor's receipt thereof). By its execution and
delivery of this Agreement, the Trustee acknowledges the assignment to it of the
Mortgage Loans in good faith without notice of adverse claims and declares that
the Custodian holds and will hold such documents and all others delivered to it
constituting the Mortgage File (to the extent the documents constituting the
Mortgage File are actually delivered to the Custodian) for any Mortgage Loan
assigned to the Trustee hereunder in trust, upon the conditions herein set
forth, for the use and benefit of all present and future Certificateholders. The
Trustee agrees to review each Mortgage File within 45 days after the later of
(a) the Trustee's receipt of such Mortgage File or (b) execution and delivery of
this Agreement, to ascertain that all documents (other than the Environmental
Reports referred to in clause (ix) of Section 2.01 which shall be delivered to
the Master Servicer) referred to in Section 2.01 above (in the case of the
documents referred to in Section 2.01(iv), (v), (vi), (vii) (in the case of any
endorsement thereto) and (viii) and (x) through (xvi), as identified to it in
writing by the Depositor) and any original recorded documents referred to in the
first sentence of this Section 2.02 included in the delivery of a Mortgage File
have been received, have been executed, appear to be what they purport to be,
purport to be recorded or filed (as applicable) and have not been torn,
mutilated or otherwise defaced, and that such documents relate to the Mortgage
Loans identified in the Mortgage Loan Schedule. In so doing, the Trustee may
rely on the purported due execution and genuineness of any such document and on
the purported genuineness of any signature thereon. If at the conclusion of such
review any document or documents constituting a part of a Mortgage File have not
been executed or received, have not been recorded or filed (if required), are
unrelated to the Mortgage Loans identified in the Mortgage Loan Schedule, appear
not to be what they purport to be or have been torn, mutilated or otherwise
defaced, the Trustee shall promptly so notify the Depositor and MSMC by
providing a written report, setting forth for each affected Mortgage Loan, with
particularity, the nature of the defective or missing document. The Depositor
shall, or shall cause MSMC to, deliver an executed, recorded or undamaged
document, as applicable, within 90 days of receipt of such notice or, if the
failure to deliver such document in such form has a material adverse effect on
the security provided by the related Mortgaged Property, the Depositor shall, or
shall cause MSMC to, repurchase the related Mortgage Loan in the manner and
within the time period provided in Section 2.03. None of the Master Servicer,
the Special Servicer and the Trustee shall be responsible for any loss, cost,
damage or expense to the Trust Fund resulting from any failure to receive any
document constituting a portion of a Mortgage File noted on such a report.
The Trustee shall hold that portion of the Trust Fund delivered to the
Trustee consisting of "instruments" (as such term is defined in Section 9-105(i)
of the Uniform Commercial Code as in effect in Massachusetts on the date hereof)
in the Commonwealth of Massachusetts and, except as otherwise specifically
provided in this Agreement, shall not remove such instruments from the
Commonwealth of Massachusetts unless it receives an Opinion of Counsel (obtained
and delivered at the expense of the Person requesting the removal of such
instruments from the Commonwealth of Massachusetts) that in the event the
transfer of the Mortgage Loans to the Trustee is deemed not to be a sale, after
such removal, the Trustee will possess a first priority perfected security
interest in such instruments.
SECTION 2.03. Representations and Warranties of the Depositor.
(a) The Depositor hereby represents and warrants 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 has taken all necessary action to authorize
the execution, delivery and performance of this Agreement by
it, and has the power and authority to execute, deliver and
perform this Agreement and all the transactions contemplated
hereby, including, but not limited to, the power and
authority to sell, assign and transfer the Mortgage Loans in
accordance with this Agreement;
(iii) This Agreement has been duly and validly authorized,
executed and delivered by the Depositor and assuming the due
authorization, execution and delivery of this Agreement by
each other party hereto, this Agreement and all of the
obligations of the Depositor hereunder are the legal, valid
and binding obligations of the Depositor, enforceable in
accordance with the terms of this Agreement, except as such
enforcement may be limited by bankruptcy, insolvency,
reorganization, liquidation, receivership, moratorium or
other laws relating to or affecting creditors' rights
generally, or by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law);
(iv) The execution and delivery of this Agreement and the
performance of its obligations hereunder by the Depositor
will not conflict with any provision of its certificate of
incorporation or bylaws, or any law or regulation to which
the Depositor is subject, or conflict with, result in a
breach of or constitute a default under (or an event which
with notice or lapse of time or both would constitute a
default under) any of the terms, conditions or provisions of
any agreement or instrument to which the Depositor is a
party or by which it is bound, or any order or decree
applicable to the Depositor, or result in the creation or
imposition of any lien on any of the Depositor's assets or
property, which would materially and adversely affect the
ability of the Depositor to carry out the transactions
contemplated by this Agreement. The Depositor has obtained
any consent, approval, authorization or order of any court
or governmental agency or body required for the execution,
delivery and performance by the Depositor of this Agreement;
(v) There is no action, suit or proceeding pending against the
Depositor in any court or by or before any other
governmental agency or instrumentality which would
materially and adversely affect the ability of the Depositor
to carry out its obligations under this Agreement; and
(vi) The Trustee, if not the owner of the related Mortgage Loan,
will have a valid and perfected security interest of first
priority in each of the Mortgage Loans and any proceeds
thereof.
(b) It is understood and agreed that the representations and warranties set
forth in this Section 2.03 shall survive delivery of the respective Mortgage
Files to the Trustee until the termination of this Agreement, and shall inure to
the benefit of the Certificateholders and the Master Servicer.
(c) Upon discovery by the Custodian, the Master Servicer, the Special
Servicer, or the Trustee of a breach of any representation or warranty of MSMC
in the Loan Sale Agreement, with respect to any Mortgage Loan, or that any
document required to be included in the Mortgage File does not conform to the
requirements of Section 2.01, such Person shall give prompt notice thereof to
MSMC and the Depositor, and MSMC shall, to the extent MSMC is obligated to cure
or repurchase the related Mortgage Loan, under the terms of the Loan Sale
Agreement, either cure such breach or repurchase said Mortgage Loan, at the
Repurchase Price within 90 days of the receipt of notice of the breach; it being
understood and agreed that none of the Custodian, the Master Servicer, the
Special Servicer, and the Trustee has an obligation to conduct any investigation
with respect to such matters (except, in the case of the Mortgage Files, to the
extent provided in Section 2.01); provided, however, that in the event that such
breach or non-conformity (other than a breach or non-conformity that would cause
a related Mortgage Loan to fail to qualify as a Qualified Mortgage) is capable
of being cured but not within such 90 day period and MSMC has commenced and is
diligently proceeding with the cure of such breach or non-conformity within such
90 day period, MSMC shall have an additional 90 days to complete such cure;
provided, further, that with respect to such additional 90 day period MSMC shall
have delivered an officer's certificate to the Trustee and the Master Servicer
setting forth the reason such breach is not capable of being cured within the
initial 90 day period and what actions MSMC is pursuing in connection with the
cure thereof and stating that MSMC anticipates that such breach will be cured
within the additional 90 day period. Notwithstanding the foregoing, any such
breach or non-conformity that causes the related Mortgage Loan to fail to
qualify as a Qualified Mortgage shall be repurchased by MSMC at the Repurchase
Price within 90 days of the discovery of such breach or non-conformity.
(d) Upon receipt by the Master Servicer from MSMC of the Repurchase Price
for the repurchased Mortgage Loan, the Master Servicer shall deposit such amount
in the Collection Account, and the Trustee, pursuant to Section 3.11, shall,
upon receipt of a certificate of a Servicing Officer certifying as to the
receipt by the Master Servicer of the Repurchase Price and the deposit of the
Repurchase Price into the Collection Account pursuant to this Section 2.03(d),
release or cause to be released to MSMC the related Mortgage File and shall
execute and deliver such instruments of transfer or assignment, in each case
without recourse, representation or warranty, as shall be prepared by the Master
Servicer to vest in MSMC any Mortgage Loan released pursuant hereto, and any
rights of MSMC in, to and under the Loan Sale Agreement as it relates to such
Mortgage Loan, that were initially transferred to the Trust Fund under Section
2.01, and the Trustee and the Master Servicer shall have no further
responsibility with regard to such Mortgage File.
(e) In the event that MSMC incurs any expense in connection with curing a
breach of a representation or warranty pursuant to Section 2.03(c) which also
constitutes a default under the related Mortgage Loan, MSMC shall have a right,
subrogated to that of the Trustee, as successor to the mortgagee, to recover the
amount of such expenses from the related Borrower. The Master Servicer shall use
reasonable efforts in recovering, or assisting MSMC in recovering, from the
related Borrower the amount of any such expenses.
SECTION 2.04. Representations, Warranties and Covenants of the Master
Servicer and Special Servicer.
(a) The Master Servicer, in its capacity as Master Servicer hereunder,
hereby represents, warrants and covenants that as of the Closing Date:
(i) The Master Servicer is a corporation duly organized, validly
existing, and in good standing under the laws of the State
of Delaware; the Master Servicer is, and throughout the term
of this Agreement shall remain, to the extent necessary to
comply with its obligations under this Agreement, duly
authorized and qualified to transact business as a foreign
corporation in each jurisdiction where any Mortgaged
Property is located any and all business contemplated by
this Agreement; the Master Servicer possesses and shall
continue to possess all requisite authority, power,
licenses, permits, franchises, and approvals necessary in
order to conduct its business and to execute, deliver, and
comply with its obligations under this Agreement;
(ii) The execution and delivery of this Agreement and the Master
Servicer's performance of and compliance with the terms
hereof in the manner contemplated by this Agreement (A) will
not violate the charter or by-laws of the Master Servicer,
respectively, or any other instrument governing its
operations and (B) will not violate any laws, regulations,
orders or decrees of any governmental authority applicable
to the Master Servicer, which violation could reasonably be
expected to materially and adversely affect the Master
Servicer's performance under this Agreement and (C) will not
constitute a default (or any event which, with notice or
lapse of time or both, would constitute a default) under any
contract, agreement, or other instrument to which the Master
Servicer is a party or which may be applicable to any of its
assets;
(iii) The Agreement constitutes a valid, legal, and binding
obligation of the Master Servicer, enforceable against it in
accordance with its terms, subject to bankruptcy,
insolvency, reorganization, receivership laws and other laws
of general application affecting the rights of creditors and
subject to the application of the rules of equity, including
those respecting the availability of specific performance;
(iv) The Agreement has been duly executed and delivered by the
Master Servicer;
(v) All consents, approvals, authorizations, orders or filings
of or with any court or governmental agency or body, if any,
required for the execution, delivery and performance of this
Agreement by the Master Servicer have been obtained or made;
(vi) There is no action, suit, proceeding or arbitration pending
and, to the best of the Master Servicer's knowledge, there
is no action, suit proceeding, arbitration, or governmental
investigation threatened against the Master Servicer the
adverse outcome of which (whether pending or threatened)
could reasonably be expected to materially and adversely
affect the Master Servicer's performance under this
Agreement;
(vii) The Master Servicer will examine each Sub-Servicing
Agreement and will be familiar with the terms thereof. Any
Sub-Servicing Agreements will comply with the provisions of
Section 3.01; and
(viii) Each officer or employee of the Master Servicer that has
responsibilities concerning the servicing and administration
of Mortgage Loans is covered by errors and omissions
insurance in the amounts and with the coverage required by
Section 3.08. Neither the Master Servicer nor, to the best
of the Master Servicer's knowledge, any of its officers or
employees that is involved in the servicing or
administration of Mortgage Loans has been refused such
coverage or insurance.
(b) The Special Servicer, hereby represents, warrants and covenants that as
of the Closing Date or as of such date specifically provided herein:
(i) The Special Servicer is a limited liability company, duly
organized, validly existing and in good standing under the
laws of the State of the jurisdiction of its formation and
has all licenses necessary to carry on its business as now
being conducted or will be in compliance with the laws of
each state or foreign jurisdiction in which any Mortgaged
Property is located to the extent necessary to comply with
its duties and responsibilities hereunder with respect to
each Mortgage Loan in accordance with the terms of this
Agreement;
(ii) The Special Servicer has the full corporate power, authority
and legal right to execute and deliver this Agreement and to
perform in accordance herewith; the execution and delivery
of this Agreement by the Special Servicer and its
performance and compliance with the terms of 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
contract, agreement or other instrument to which the Special
Servicer is a party or which may be applicable to the
Special Servicer or any of its assets;
(iii) This Agreement has been duly and validly authorized,
executed and delivered by the Special Servicer and, assuming
due authorization, execution and delivery by the other
parties hereto, constitutes a legal, valid and binding
obligation of the Special Servicer, enforceable against it
in accordance with the terms of this Agreement, except as
such enforcement may be limited by bankruptcy, insolvency,
reorganization, liquidation, receivership, moratorium or
other laws relating to or affecting creditors' rights
generally, or by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law), and all requisite action has been taken
by the Special Servicer to make this Agreement and all
agreements contemplated hereby valid and binding upon the
Special Servicer in accordance with their terms;
(iv) The Special Servicer is not in violation of, and the
execution and delivery of this Agreement by the Special
Servicer and its performance and compliance with the terms
of this Agreement will not constitute a violation with
respect to, any statute, order or decree of any court
binding on the Special Servicer or any order or regulation
of any federal, state, municipal or governmental agency
having jurisdiction, or result in the creation or imposition
of any lien, charge or encumbrance which, in any such event,
would have consequences that would materially and adversely
affect the condition (financial or otherwise) or operation
of the Special Servicer or its properties or impair the
ability of the Trust Fund to realize on the Mortgage Loans;
(v) There is no action, suit, proceeding or arbitration pending
and, to the best of the Special Servicer's knowledge, there
is no action, suit proceeding, arbitration, or governmental
investigation threatened against the Special Servicer the
adverse outcome of which (whether pending or threatened)
could reasonably be expected to materially and adversely
affect the Special Servicer's performance under this
Agreement;
(vi) No consent, approval, authorization or order of, or
registration or filing with, or notice to any court or
governmental agency or body, is required for the execution,
delivery and performance by the Special Servicer of or
compliance by the Special Servicer with this Agreement, or
if required, such approval has been obtained prior to the
Cut-Off Date; and
(vii) Each officer or employee of the Special Servicer that has or
will have responsibilities concerning the servicing and
administration of Mortgage Loans is covered by errors and
omissions insurance in the amounts and with the coverage
required by Section 3.08. Neither the Special Servicer nor,
to the best of the Special Servicer's knowledge, any of its
officers or employees that is or will be involved in the
servicing or administration of Mortgage Loans has been
refused such coverage or insurance.
(c) It is understood and agreed that the representations and warranties set
forth in this Section shall survive delivery of the respective Mortgage Files to
the Trustee or the Custodian on behalf of the Trustee until the termination of
this Agreement, and shall inure to the benefit of the Trustee, the Depositor and
the Master Servicer or Special Servicer, as the case may be. Upon discovery by
the Depositor, the Master Servicer, the Special Servicer or a Responsible
Officer of the Trustee (or upon written notice thereof from any
Certificateholder) of a breach of any of the representations and warranties set
forth in this Section which materially and adversely affects the interests of
the Certificateholders, the Master Servicer, the Special Servicer or the Trustee
in any Mortgage Loan, the party discovering such breach shall give prompt
written notice to the other parties hereto.
SECTION 2.05. Execution and Delivery of Certificates; Issuance
of Lower-Tier Regular Interests.
The Trustee acknowledges the assignment to it of the Mortgage Loans and the
delivery of the Mortgage Files to the Custodian (to the extent the documents
constituting the Mortgage Files are actually delivered to the Custodian),
subject to the provisions of Section 2.01 and Section 2.02 and, concurrently
with such delivery, (i) the Trustee acknowledges the issuance of the Lower-Tier
Regular Interests to the Depositor and the execution, authentication, and
delivery of the Class LR Certificates to or upon the order of the Depositor,
evidencing ownership of the entire Lower-Tier REMIC, in exchange for the
Mortgage Loans (other than the Deferred Interest and the Default Interest),
receipt of which is hereby acknowledged, (ii) the Depositor hereby conveys all
rights, title and interest in and to the Lower-Tier Regular Interests to the
Trustee and (iii) the Trustee acknowledges that it has executed and caused to be
authenticated and delivered to and upon the order of the Depositor, (A) in
exchange for the Lower-Tier Regular Interests and the Deferred Interest, the
Regular Certificates and the Class R Certificates and (B) in exchange for the
Default Interest, the Class Q Certificates, in authorized denominations,
registered in the names set forth in such order and duly authenticated by the
Trustee evidencing ownership of the Upper-Tier REMIC and the undivided interests
in the Grantor Trust set forth in Section 2.06(b).
SECTION 2.06. Miscellaneous REMIC and Grantor Trust Provisions.
(a) The Class LA-1, Class LA-2, Class LA-3, Class LB, Class LC, Class LD,
Class LE, Class LF, Class LG, Class LH and Class LJ Interests are hereby
designated as "regular interests" in the Lower-Tier REMIC within the meaning of
Section 860G(a)(1) of the Code, and the Class LR Certificates are hereby
designated as the sole class of "residual interests" in the Lower-Tier REMIC
within the meaning of Section 860G(a)(2) of the Code. The Class A-1, Class A-2,
Class A-3, Class X, Class B, Class C, Class D, Class E, Class F, Class G, Class
H and Class J Certificates are hereby designated as representing beneficial
interests in "regular interests" in the Upper-Tier REMIC within the meaning of
Section 860G(a)(1) of the Code and the Class R Certificates are hereby
designated as the sole class of "residual interests" in the Upper-Tier REMIC
within the meaning of Section 860G(a)(2) of the Code. The Closing Date is hereby
designated as the "Startup Day" of the Lower-Tier REMIC and the Upper-Tier REMIC
within the meaning of Section 860G(a)(9) of the Code. The "latest possible
maturity date" of the Lower-Tier Regular Interests and the Regular Certificates
for purposes of Section 860G(a)(1) of the Code is the Scheduled Final
Distribution Date.
(b) The Class Q Certificates represent pro rata undivided beneficial
interests in the Default Interest (subject to the obligation of the Trust Fund
to pay the Advance Interest Amounts), proceeds therefrom and the Class Q
Distribution Account. The Class B, Class C, Class D, Class E, Class F, Class G,
Class H and Class J Certificates represent pro rata undivided beneficial
interests in any Deferred Interest with respect to the Mortgage Loans and
related portions of the Deferred Interest Distribution Account, in the
proportions specified in Section 4.01(e). The Class Q Certificates do not
represent regular or residual interests in either the Upper-Tier REMIC or the
Lower-Tier REMIC.
(c) None of the Depositor, the Trustee, the Master Servicer or the Special
Servicer shall enter into any arrangement by which the Trust Fund will receive a
fee or other compensation for services other than as specifically contemplated
herein.
<PAGE>
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.01. Master Servicer to Act as Master Servicer; Administration of
the Mortgage Loans.
(a) The Master Servicer and the Special Servicer, each as an independent
contractor, shall service and administer the Mortgage Loans on behalf of the
Trust Fund and the Trustee (as trustee for Certificateholders) in accordance
with the Servicing Standard. To the extent consistent with the foregoing and
subject to any express limitations set forth in this Agreement, the Master
Servicer and Special Servicer shall seek to maximize the timely and complete
recovery of principal and interest on the Mortgage Loans. Subject only to the
Servicing Standard, the Master Servicer and Special Servicer shall have full
power and authority, acting alone or through sub-servicers (subject to paragraph
(c) of this Section 3.01 and to Section 3.02), to do or cause to be done any and
all things in connection with such servicing and administration which it may
deem consistent with the Servicing Standard and, in its reasonable judgment, in
the best interests of the Certificateholders, including, without limitation,
with respect to each Mortgage Loan, to prepare, 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 on each Mortgaged Property and related
collateral; (ii) any modifications, waivers, consents or amendments to or with
respect to any documents contained in the related Mortgage File; and (iii) any
and all instruments of satisfaction or cancellation, or of partial or full
release or discharge, and all other comparable instruments, with respect to the
Mortgage Loans and the Mortgaged Properties. Notwithstanding the foregoing,
neither the Master Servicer nor the Special Servicer shall modify, amend, waive
or otherwise consent to any change of the terms of any Mortgage Loan except
under the circumstances described in Sections 3.09, 3.10, 3.25 and 3.26 or the
definition of Extended Monthly Payment hereof. The Master Servicer and Special
Servicer shall service and administer the Mortgage Loans in accordance with
applicable law and shall provide to the Borrowers any reports required to be
provided to them thereby. Subject to Section 3.11, the Trustee shall, upon the
receipt of a written request of a Servicing Officer, execute and deliver to the
Master Servicer and Special Servicer any powers of attorney and other documents
prepared by the Master Servicer and Special Servicer and necessary or
appropriate (as certified in such written request) to enable the Master Servicer
and Special Servicer to carry out their servicing and administrative duties
hereunder. Each of the Master Servicer and the Special Servicer shall indemnify
the Trustee for any and all costs, liabilities and expenses incurred by the
Trustee in connection with the negligent or willful misuse of such powers of
attorney by the Master Servicer or the Special Servicer, as applicable.
(b) Unless otherwise provided in the related Loan Documents, the Master
Servicer shall apply any partial Principal Prepayment received on a Mortgage
Loan on a date other than a Due Date to the principal balance of such Mortgage
Loan as of the Due Date immediately following the date of receipt of such
partial Principal Prepayment. Unless otherwise provided in the related Loan
Documents, the Master Servicer shall apply any amounts received on U.S. Treasury
obligations (which shall not be redeemed by the Master Servicer prior to the
maturity thereof) in respect of a Mortgage Loan being defeased pursuant to its
terms to the principal balance of and interest on such Mortgage Loan as of the
Due Date immediately following the receipt of such amounts.
(c) Each of the Master Servicer and the Special Servicer may enter into
sub-servicing agreements (each a "Sub-servicing Agreement") with third parties
with respect to any of its respective obligations hereunder, provided that (i)
any such agreement shall be consistent with the provisions of this Agreement,
(ii) no sub-servicer retained by the Master Servicer or the Special Servicer, as
applicable, shall grant any modification, waiver or amendment to any Mortgage
Loan without the approval of the Master Servicer or the Special Servicer, as
applicable, which approval shall be given or withheld in accordance with the
procedures set forth in Sections 3.09, 3.10, 3.25, 3.26, or the definition of
Extended Monthly Payment and (iii) such agreement shall be consistent with the
Servicing Standard. Any such sub-servicing agreement may permit the sub-servicer
to delegate its duties to agents or subcontractors so long as the related
agreements or arrangements with such agents or subcontractors are consistent
with the provisions of this Section 3.01(c). Any sub-servicing agreement entered
into by the Master Servicer or the Special Servicer, as applicable, shall
provide that it may be assumed or terminated by the Trustee, if the Trustee has
assumed the duties of the Master Servicer or the Special Servicer, or by any
successor Master Servicer or Special Servicer, as applicable, without cost or
obligation to the assuming or terminating party or the Trust Fund, upon the
assumption by such party of the obligations of the Master Servicer or the
Special Servicer, as applicable, pursuant to Section 7.02; provided, however,
the Trustee or any successor Master Servicer shall assume the sub-servicing
agreements with the Initial Sub-servicers, provided that such Persons are not in
default under their respective Sub-servicing Agreements.
Any sub-servicing agreement, and any other transactions or services
relating to the Mortgage Loans involving a sub-servicer, shall be deemed to be
between the Master Servicer or the Special Servicer, as the case may be, and
such sub-servicer alone, and the Trustee, the Trust Fund and the
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to the sub-servicer,
except as set forth in Section 3.01(d) and no provision herein may be construed
so as to require the Trust Fund to indemnify any such sub-servicer.
(d) If the Trustee or any successor Master Servicer assumes the obligations
of the Master Servicer, or if the Trustee or any successor Special Servicer
assumes the obligations of the Special Servicer, in each case in accordance with
Section 7.02, the Trustee or such successor, as applicable, to the extent
necessary to permit the Trustee or such successor, as applicable, to carry out
the provisions of Section 7.02, shall, without act or deed on the part of the
Trustee or such successor, as applicable, succeed to all of the rights and
obligations of the Master Servicer or the Special Servicer, as applicable, under
any sub-servicing agreement entered into by the Master Servicer or the Special
Servicer, as applicable, pursuant to Section 3.01(c), subject to the right of
termination by the Trustee set forth in Section 3.01(c). In such event, the
Trustee or the successor Master Servicer or the successor Special Servicer, as
applicable, shall be deemed to have assumed all of the Master Servicer's or the
Special Servicer's interest, as applicable, therein (but not any liabilities or
obligations in respect of acts or omissions of the Master Servicer or the
Special Servicer, as applicable, prior to such deemed assumption) and to have
replaced the Master Servicer or the Special Servicer, as applicable, as a party
to such sub-servicing agreement to the same extent as if such sub-servicing
agreement had been assigned to the Trustee or such successor Master Servicer or
successor Special Servicer, as applicable, except that the Master Servicer or
Special Servicer, as applicable, shall not thereby be relieved of any liability
or obligations under such sub-servicing agreement that accrued prior to the
succession of the Trustee or the successor Master Servicer or successor Special
Servicer, as applicable.
In the event that the Trustee or any successor Master Servicer or successor
Special Servicer, as applicable, assumes the servicing obligations of the Master
Servicer or the Special Servicer, as applicable, upon request of the Trustee, or
such successor Master Servicer or Special Servicer, as applicable, the Master
Servicer or Special Servicer shall at its own expense deliver to the Trustee or
such successor Master Servicer or Special Servicer, as applicable, all documents
and records relating to any sub-servicing agreement and the Mortgage Loans then
being serviced thereunder and an accounting of amounts collected and held by it,
if any, and will otherwise use its best efforts to effect the orderly and
efficient transfer of any sub-servicing agreement to the Trustee or the
successor Master Servicer or Special Servicer, as applicable.
SECTION 3.02. Liability of the Master Servicer and Special Servicer.
Notwithstanding any sub-servicing agreement, any of the provisions of this
Agreement relating to agreements or arrangements between the Master Servicer or
Special Servicer and any Person acting as sub-servicer (or its agents or
subcontractors) or any reference to actions taken through any Person acting as
sub-servicer or otherwise, the Master Servicer or Special Servicer, as
applicable, shall remain obligated and primarily liable for the servicing and
administering of the Mortgage Loans in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of such
sub-servicing agreements or arrangements or by virtue of indemnification from
any Person acting as sub-servicer (or its agents or subcontractors) to the same
extent and under the same terms and conditions as if the Master Servicer or
Special Servicer, as applicable, alone were servicing and administering the
Mortgage Loans. Each of the Master Servicer and the Special Servicer shall be
entitled to enter into an agreement with any sub-servicer providing for
indemnification of the Master Servicer or Special Servicer, as applicable, by
such sub-servicer, and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification, but no such agreement for indemnification
shall be deemed to limit or modify this Agreement.
SECTION 3.03. Collection of Certain Mortgage Loan Payments.
(a) The Master Servicer or the Special Servicer, as applicable, shall use
its reasonable best efforts, consistent with the Servicing Standard, to collect
all payments called for under the terms and provisions of the Mortgage Loans it
is obligated to service hereunder, and shall follow the Servicing Standard with
respect to such collection procedures. The Master Servicer or the Special
Servicer, as applicable, shall use its reasonable best efforts, consistent with
the Servicing Standard, to collect income statements, rent rolls and other
reporting information from Borrowers as required by the related Loan Documents
and the terms hereof. Consistent with the foregoing, the Master Servicer or
Special Servicer, as applicable, may in its discretion waive any late payment
charge in connection with any delinquent Monthly Payment with respect to any
Mortgage Loan. In addition, the Master Servicer or the Special Servicer, as
applicable, shall be entitled to take such actions with respect to the
collection of payments on the Mortgage Loans as are permitted or required under
Section 3.25 hereof.
(b) In the event that the Master Servicer or Special Servicer receives, or
receives notice from the related Borrower that it will be receiving, Deferred
Interest in any Collection Period, the Master Servicer or Special Servicer, as
applicable, will promptly notify the Trustee.
SECTION 3.04. Collection of Taxes, Assessments and Similar Items; Escrow
Accounts.
(a) With respect to each Mortgage Loan (other than any REO Mortgage Loan),
the Master Servicer shall maintain accurate records with respect to each related
Mortgaged Property reflecting the status of taxes, assessments, ground rents and
other similar items that are or may become a lien on the related Mortgaged
Property and the status of insurance premiums payable with respect thereto. From
time to time, the Master Servicer shall (i) shall use its reasonable best
efforts, consistent with the Servicing Standard, to obtain all bills for the
payment of such items (including renewal premiums), and (ii) subject to Section
3.08 with respect to the payment of insurance premiums, effect payment of all
such bills with respect to such Mortgaged Properties prior to the applicable
penalty or termination date, in each case employing for such purpose Escrow
Payments as allowed under the terms of the related Mortgage Loan. If a Borrower
fails to make any such payment on a timely basis or collections from the
Borrower are insufficient to pay any such item before the applicable penalty or
termination date, the Master Servicer shall advance the amount of any shortfall
as a Property Advance unless the Master Servicer determines in its good faith
business judgment that such Advance would be a Nonrecoverable Advance; provided,
however, that with respect to the payment of taxes and assessments, in the event
that the Master Servicer reasonably anticipates that such bill will be paid by
the related Borrower prior to the close of business on such penalty or
termination date, the Master Servicer may delay payment of such tax or
assessment until the earlier of (i) five Business Days after the Master Servicer
has determined that such bill has not been paid by the related Borrower prior to
the close of business on such penalty or termination date and (ii) forty-five
(45) days past such penalty or termination date; provided that during such
forty-five day period the Master Servicer shall use its best efforts to
determine whether the related Borrower has paid such tax or assessment prior to
the close of business on such penalty or termination date. The Master Servicer
shall be entitled to reimbursement of Advances, with interest thereon at the
Advance Rate, that it makes pursuant to the preceding sentence from amounts
received on or in respect of the related Mortgage Loan respecting which such
Advance was made or if such Advance has become a Nonrecoverable Advance, to the
extent permitted by Section 3.06 of this Agreement. No costs incurred by the
Master Servicer in effecting the payment of taxes and assessments on the
Mortgaged Properties shall, for the purpose of calculating distributions to
Certificateholders, be added to the amount owing under the related Mortgage
Loans, notwithstanding that the terms of such Mortgage Loans so permit.
(b) The Master Servicer shall segregate and hold all funds collected and
received pursuant to any Mortgage Loan constituting Escrow Payments separate and
apart from any of its own funds and general assets and shall establish and
maintain one or more segregated custodial accounts (each, an "Escrow Account")
into which all Escrow Payments shall be deposited within one Business Day after
receipt. The Master Servicer shall also deposit into each applicable Escrow
Account any amounts representing losses on Permitted Investments pursuant to
Section 3.07(b) and any Insurance Proceeds or Liquidation Proceeds which are
required to be applied to the restoration or repair of any Mortgaged Property
pursuant to the related Mortgage Loan. Escrow Accounts shall be Eligible
Accounts (except to the extent the related Mortgage Loan requires or permits it
to be held in an account that is not an Eligible Account) and shall be entitled,
"Midland Loan Services, Inc., as Master Servicer, in trust for State Street Bank
and Trust Company, as Trustee in trust for Holders of Morgan Stanley Capital I
Inc., Commercial Mortgage Pass-Through Certificates, Series 1998-XL1 and Various
Borrowers". Withdrawals from an Escrow Account may be made by the Master
Servicer only:
(i) to effect timely payments of items for which Escrow Payments
have been made in accordance with the related Loan Documents
and in accordance with the terms of the related Mortgage
Loan;
(ii) to transfer funds to the Collection Account to reimburse the
Master Servicer, the Special Servicer or the Trustee, as
applicable, for any Advance (with interest thereon at the
Advance Rate) relating to Escrow Payments, but only from
amounts received with respect to the related Mortgage Loan
which represent late collections of Escrow Payments
thereunder;
(iii) for application to the restoration or repair of the related
Mortgaged Property in accordance with the related Mortgage
Loan and the Servicing Standard;
(iv) to clear and terminate such Escrow Account upon the
termination of this Agreement;
(v) to pay from time to time to the related Borrower (A) any
interest or investment income earned on funds deposited in
the Escrow Account if such income is required to be paid to
the related Borrower under law or by the terms of the
Mortgage Loan, or otherwise to the Master Servicer and (B)
any other funds required to be released to the related
Borrowers pursuant to the related Loan Documents; and
(vi) to remove any funds deposited in an Escrow Account that were
not required to be deposited therein.
SECTION 3.05. Collection Account; Upper-Tier Distribution Account;
Lower-Tier Distribution Account; Class Q Distribution
Account; and Deferred Interest Distribution Account.
(a) The Master Servicer shall establish and maintain the Collection Account
in the Trustee's name, for the benefit of the Certificateholders and the Trustee
as the Holder of the Lower-Tier Regular Interests. The Collection Account shall
be established and maintained as an Eligible Account. The Master Servicer shall
deposit or cause to be deposited in the Collection Account within one Business
Day following receipt the following payments and collections received or made by
it on or with respect to the Mortgage Loans:
(i) all payments on account of principal on the Mortgage Loans,
including the principal component of Unscheduled Payments;
(ii) all payments on account of interest on the Mortgage Loans
and the interest portion of all Unscheduled Payments;
(iii) all Prepayment Premiums;
(iv) any amounts required to be deposited pursuant to Section
3.07(b) in connection with net losses realized on Permitted
Investments with respect to funds held in the Collection
Account;
(v) all Net REO Proceeds withdrawn from an REO Account pursuant
to Section 3.17(b) and all Net Insurance Proceeds and Net
Liquidation Proceeds;
(vi) any amounts received from Borrowers which represent
recoveries of Property Protection Expenses, to the extent
not permitted to be retained by the Master Servicer as
provided herein; and
(vii) any other amounts required by the provisions of this
Agreement to be deposited into the Collection Account by the
Master Servicer or Special Servicer, including, without
limitation, proceeds of any repurchase of a Mortgage Loan
pursuant to Sections 2.03(c) hereof.
The foregoing requirements for deposits in the Collection Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, payments in the nature of late payment charges (subject to
Section 3.12 hereof), Assumption Fees, loan service transaction fees, extension
fees, demand fees, beneficiary statement charges and similar fees need not be
deposited in the Collection Account by the Master Servicer and, to the extent
permitted by applicable law, the Master Servicer and Special Servicer shall be
entitled to retain the portion of any such charges and fees received with
respect to the Mortgage Loans to the extent to which it is entitled pursuant to
Section 3.12. In the event that the Master Servicer deposits 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. The Master Servicer shall give written notice to the
Trustee of the location and account number of the Collection Account and shall
notify the Trustee in writing of any subsequent change thereof.
(b) The Trustee shall establish and maintain (i) the Lower-Tier
Distribution Account in the name of the Trustee, in trust for the benefit of the
Certificateholders and the Trustee as the Holder of the Lower-Tier Regular
Interests; and (ii) the Upper-Tier Distribution Account in the name of the
Trustee, in trust for the benefit of the Certificateholders. The Lower-Tier
Distribution Account and Upper-Tier Distribution Account shall be established
and maintained as Eligible Accounts. With respect to each Distribution Date, on
or before such date the Trustee shall make the withdrawals from the Lower-Tier
Distribution Account, as set forth in Section 4.01 hereof, shall make the
deposits into the Upper-Tier Distribution Account, as set forth in Section 4.01
hereof, and shall cause the amount of Available Funds (including P&I Advances)
and Prepayment Premiums to be distributed in respect of the Certificates,
pursuant to Section 4.01 hereof on such date.
(c) The Trustee shall establish and maintain the Class Q Distribution
Account in the name of the Trustee in trust for the benefit of the Holders of
the Class Q Certificates. The Class Q Distribution Account shall be established
and maintained as an Eligible Account. On or before the Master Servicer
Remittance Date related to each Distribution Date, the Master Servicer shall
remit to the Trustee for deposit in the Class Q Distribution Account an amount
equal to (i) the amount of the aggregate Default Interest received during the
preceding Collection Period, minus (ii) any portions thereof withdrawn from the
Collection Account pursuant to clause (ii) of Section 3.06 or otherwise applied
to pay the Advance Interest Amount in respect of Advances (such amount, if any,
the "Net Default Interest" for such Distribution Date).
(d) Prior to the Master Servicer Remittance Date relating to the Collection
Period, if any, in which Deferred Interest is received, the Trustee shall
establish and maintain the Deferred Interest Distribution Account in the name of
the Trustee in trust for the benefit of the Certificateholders as set forth in
Section 2.06(b). The Deferred Interest Distribution Account shall be established
and maintained as an Eligible Account. On or before the Master Servicer
Remittance Date related to the applicable Distribution Date, the Master Servicer
shall remit to the Trustee for deposit in the Deferred Interest Distribution
Account an amount equal to the Deferred Interest received during the applicable
Collection Period.
Following the distribution of Deferred Interest to Certificateholders on
the first Distribution Date after which there are no longer any Mortgage Loans
outstanding which pursuant to their terms could pay Deferred Interest, the
Trustee shall terminate the Deferred Interest Distribution Account.
(e) Funds in the Collection Account may be invested only in Permitted
Investments in accordance with the provisions of Section 3.07.
SECTION 3.06. Permitted Withdrawals from the Collection Account.
The Master Servicer may make withdrawals from the Collection Account only
as described below (the order set forth below not constituting an order of
priority for such withdrawals):
(i) to remit to the Trustee for deposit in the Lower-Tier
Distribution Account, the Class Q Distribution Account and
the Deferred Interest Distribution Account, the amounts
required to be deposited in the Lower-Tier Distribution
Account, the Class Q Distribution Account and the Deferred
Interest Distribution Account pursuant to Sections 4.01(a),
3.05(c) and 3.05(d), respectively;
(ii) to pay or reimburse the Master Servicer, the Special
Servicer or the Trustee for Advances and any related Advance
Interest Amounts to the extent not paid from Default
Interest (provided that the Trustee shall have priority with
respect to such payment or reimbursement), the Master
Servicer's right to reimburse any such Person pursuant to
this clause (ii) being limited to (x) any collections on or
in respect of the particular Mortgage Loan or REO Property
respecting which such Advance was made, or (y) any other
amounts in the Collection Account in the event that such
Advances have been deemed to be Nonrecoverable Advances or
are not recovered from such recoveries in respect of the
related Mortgage Loan or REO Property after a Final Recovery
Determination; provided, however, that, with respect to the
Magellan Apartment Pool Loan, which provides for a grace
period in connection with Monthly Payments, the Master
Servicer or Trustee as applicable, shall only be entitled to
interest on any P&I Advance made with respect to such
Mortgage Loan, from the date such grace period expires and
only to the extent that the applicable Monthly Payment is
not received prior to the expiration of such grace period;
(iii) to pay on or before each Master Servicer Remittance Date to
the Master Servicer and the Special Servicer, as applicable,
as compensation, the aggregate unpaid Servicing Fee and
Special Servicing Compensation (if any), respectively, in
respect of the immediately preceding Interest Accrual
Period, to be paid, in the case of the Servicing Fee, from
interest received on the related Mortgage Loan, and to pay
from time to time to the Master Servicer in accordance with
Section 3.07(b) any interest or investment income earned on
funds deposited in the Collection Account;
(iv) to pay on or before each Distribution Date to the Depositor,
MSMC or any other applicable Person as the case may be, with
respect to each Mortgage Loan or REO Property that has
previously been purchased or repurchased by it pursuant to
Section 2.03(c), Section 3.18 or Section 9.01, all amounts
received thereon during the related Collection Period and
subsequent to the date as of which the amount required to
effect such purchase or repurchase was determined;
(v) to the extent not reimbursed or paid pursuant to any other
clause of this Section 3.06, to reimburse or pay the Master
Servicer, the Trustee, the Special Servicer or the
Depositor, as applicable, for unpaid Servicing Fees, Special
Servicing Compensation and other unpaid items incurred by
such Person pursuant to the second sentence of Section
3.07(c), Section 3.08(a) and (b), Section 3.10, Section
3.12(e), Section 3.17(a), Section 3.18(b), Section 6.03,
Section 7.04, Sections 8.05(a), (b) and (d) or Section
10.07, or any other provision of this Agreement pursuant to
which such Person is entitled to reimbursement or payment
from the Trust Fund, in each case only to the extent
expressly reimbursable under such Section, it being
acknowledged that this clause (v) shall not be deemed to
modify the substance of any such Section, including the
provisions of such Section that set forth the extent to
which one of the foregoing Persons is or is not entitled to
payment or reimbursement;
(vi) to transfer to the Trustee for deposit in one or more
separate, non-interest bearing accounts any amount
reasonably determined by the Trustee to be necessary to pay
any applicable federal, state or local taxes imposed on the
Upper-Tier REMIC or the Lower-Tier REMIC under the
circumstances and to the extent described in Section 4.05;
(vii) to withdraw any amount deposited into the Collection Account
that was not required to be deposited therein;
(viii) with respect to the first Interest Accrual Period, to
withdraw an amount equal to the Servicing Fee for the period
commencing on the Cut-Off Date and ending on the day
immediately prior to the Closing Date, and to remit such
amount to the Depositor; and
(ix) to clear and terminate the Collection Account pursuant to
Section 9.01.
The Master Servicer shall keep and maintain separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account pursuant to subclauses (ii)-(v) above.
The Master Servicer shall pay to the Trustee or the Special Servicer from
the Collection Account amounts permitted to be paid to the Trustee or the
Special Servicer therefrom as set forth above, promptly upon receipt of a
certificate of a Responsible Officer of the Trustee or a certificate of a
Servicing Officer, as applicable, describing the item and amount to which such
Person is entitled. The Master Servicer may conclusively rely on any such
certificate and shall have no duty to recalculate the amounts stated therein. In
addition, the Master Servicer shall promptly, upon receipt, pay the Depositor
the amounts permitted to be paid to the Depositor pursuant to clause (viii)
above.
The Trustee, the Special Servicer and the Master Servicer shall in all
cases have a right prior to the Certificateholders to any funds on deposit in
the Collection Account from time to time for the reimbursement or payment of the
Servicing Fees (including investment income), or Trustee Fees, Special Servicing
Compensation, Advances, Advance Interest Amounts and their respective expenses
hereunder to the extent such fees and expenses are to be reimbursed or paid from
amounts on deposit in the Collection Account pursuant to this Agreement (and to
have such amounts paid directly to third party contractors for any invoices
approved by the Trustee, the Master Servicer or the Special Servicer, as
applicable).
The Trustee shall, upon receipt, deposit in the Lower-Tier Distribution
Account, the Class Q Distribution Account and the Deferred Interest Distribution
Account any and all amounts received by the Trustee in accordance with Section
3.06(i). If, as of 3:00 p.m., New York City time, on any Master Servicer
Remittance Date or on such other date as any amount referred to in the foregoing
clause (i) is required to be delivered hereunder, the Master Servicer shall not
have delivered to the Trustee for deposit in the Lower-Tier Distribution
Account, the Class Q Distribution Account and the Deferred Interest Distribution
Account the amounts required to be deposited therein pursuant to Section
3.06(i), then the Trustee shall, to the extent that a Responsible Officer of the
Trustee has such knowledge, provide notice of such failure to the Master
Servicer by facsimile transmission sent to telecopy no. (816) 435-2326 (or such
alternative number provided by the Master Servicer to the Trustee in writing)
and by telephone at telephone no. (816) 435-5000 (or such alternative number
provided by the Master Servicer to the Trustee in writing) as soon as possible,
but in any event before 5:00 p.m., New York City time, on such day.
SECTION 3.07. Investment of Funds in the Collection Account, the REO
Account, the Borrower Accounts, and Other Accounts.
(a) The Master Servicer (or with respect to any REO Account, the Special
Servicer) may direct any Depository institution (such direction may be a
standing direction until otherwise revoked) maintaining the Collection Account
and any Borrower Accounts (subject to the second succeeding sentence) and any
REO Account (each, for purposes of this Section 3.07, an "Investment Account"),
to invest the funds in such Investment Account in one or more Permitted
Investments that bear interest or are sold at a discount, and that mature,
unless payable on demand, no later than the Business Day preceding the date on
which such funds are required to be withdrawn from such Investment Account
pursuant to this Agreement. Any direction by the Master Servicer or the Special
Servicer to invest funds on deposit in an Investment Account shall be in writing
and shall certify that the requested investment is a Permitted Investment which
matures at or prior to the time required hereby or is payable on demand. In the
case of any Escrow Account, Lock-Box Account, Cash Collateral Account or Reserve
Account (the "Borrower Accounts"), the Master Servicer shall act upon the
written request of the related Borrower or Manager to the extent the Master
Servicer is required to do so under the terms of the respective Mortgage Loan or
related documents, provided that in the absence of appropriate written
instructions from the related Borrower or Manager meeting the requirements of
this Section 3.07, the Master Servicer shall have no obligation to, but will be
entitled to, direct the investment of funds in such accounts in Permitted
Investments. 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) or in the name of a
nominee of the Trustee. The Trustee shall have sole control (except with respect
to investment direction which shall be in the control of the Master Servicer, or
the Special Servicer, with respect to any REO Accounts), as an independent
contractor to the Trust Fund) over each such investment and any certificate or
other instrument evidencing any such investment shall be delivered directly to
the Trustee or its agent (which shall initially be the Master Servicer),
together with any document of transfer, if any, necessary to transfer title to
such investment to the Trustee or its nominee. The Trustee shall have no
responsibility or liability with respect to the investment directions of the
Master Servicer or the Special Servicer, any Borrower or Manager or any losses
resulting therefrom, whether from Permitted Investments or otherwise. In the
event amounts on deposit in an Investment Account are at any time invested in a
Permitted Investment payable on demand, the Master Servicer (or the Special
Servicer), 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 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 Master Servicer (or the Special Servicer)
that such Permitted Investment would not constitute a Permitted Investment in
respect of funds thereafter on deposit in the related Investment Account.
(b) All income and gain realized from investment of funds deposited in any
Investment Account shall be for the benefit of the Master Servicer (except with
respect to the investment of funds deposited in (i) any Borrower Account, which
shall be for the benefit of the related Borrower to the extent required under
the Mortgage Loan or applicable law or (ii) any REO Account, which shall be for
the benefit of the Special Servicer), and, if held in the Collection Account or
REO Account shall be subject to withdrawal by the Master Servicer or the Special
Servicer, as applicable, in accordance with Section 3.06 or Section 3.17(b), as
applicable. The Master Servicer (or with respect to any REO Account, the Special
Servicer) shall deposit from its own funds into any applicable Investment
Account, the amount of any loss incurred in respect of any such Permitted
Investment immediately upon realization of such loss; provided, however, that
the Master Servicer or Special Servicer, as applicable, may reduce the amount of
such payment to the extent it foregoes any investment income in such Investment
Account otherwise payable to it. The Master Servicer shall also deposit from its
own funds in any Borrower Account the amount of any loss incurred in respect of
Permitted Investments, except to the extent that amounts are invested for the
benefit of the Borrower under the terms of the Mortgage Loan or applicable law.
All amounts on deposit in the Lower-Tier Distribution Account, the
Upper-Tier Distribution Account, the Class Q Distribution Account and the
Deferred Interest Distribution Account shall be held uninvested.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee shall take such action as may be appropriate to enforce
such payment or performance, including the institution and prosecution of
appropriate proceedings. In the event the Trustee takes any such action, the
Trust Fund shall pay or reimburse the Trustee for all reasonable out-of-pocket
expenses, disbursements and advances incurred or made by the Trustee in
connection therewith; provided, however, that the Trustee shall use its best
efforts to recover any such amounts from the Person responsible for such costs.
In the event that the Trustee does not take any such action, the Master Servicer
may, but is not obligated to, take such action at its own cost and expense.
SECTION 3.08. Maintenance of Insurance Policies and Errors and Omissions
and Fidelity Coverage.
(a) The Master Servicer on behalf of the Trustee, as mortgagee, shall use
its reasonable best efforts, consistent with the Servicing Standard, to cause
the related Borrower to maintain, to the extent required by each Mortgage Loan
(other than REO Mortgage Loans), and if the Borrower does not so maintain, shall
itself maintain (subject to the provisions of this Agreement concerning
Nonrecoverable Advances and to the extent the Trustee as mortgagee has an
insurable interest and to the extent available at commercially reasonable
rates), (i) fire and hazard insurance (and hurricane insurance, if applicable)
with extended coverage on the related Mortgaged Property in an amount which is
at least equal to the lesser of (A) one hundred percent (100%) of the then "full
replacement cost" of the improvements and equipment, (excluding foundations,
footings and excavation costs), without deduction for physical depreciation, and
(B) the outstanding principal balance of the related Mortgage Loan or such
greater amount as is necessary to prevent any reduction in such policy by reason
of the application of co-insurance provisions and to prevent the Trustee
thereunder from being deemed to be a co-insurer and provided such policy shall
include a "replacement cost" rider, (ii) insurance providing coverage against 18
months (or such longer period or with such extended period endorsement as
provided in the related Mortgage or other Loan Document or, if the Mortgage Loan
expressly permits a shorter period, such shorter period) of rent interruptions
and (iii) such other insurance as is required in the related Mortgage Loan. The
Special Servicer shall maintain fire and hazard insurance with extended coverage
on each REO Property (subject to the provisions of this Agreement concerning
Nonrecoverable Advances) in an amount which is at least equal to one hundred
percent (100%) of the then "full replacement cost" of the improvements and
equipment (excluding foundations, footings and excavation costs), without
deduction for physical depreciation. If the Special Servicer does not maintain
the insurance described in the preceding sentence or the required flood
insurance described below, the Master Servicer shall, as soon as practicable
after receipt of notice of such failure, maintain such insurance, and if the
Master Servicer does not maintain such insurance, the insurance required in the
first sentence of this Section 3.08(a) or the required flood insurance described
below (if the related Borrower fails to maintain such insurance), the Trustee
shall, as soon as practicable after receipt of notice of such failure, maintain
such insurance, provided that such obligations of the Special Servicer, Master
Servicer and Trustee will be subject to the provisions of this Agreement
concerning Nonrecoverable Advances and to the availability of such insurance at
commercially reasonable rates. The Special Servicer shall maintain, with respect
to each REO Property (i) public liability insurance providing such coverage
against such risks as the Special Servicer determines, consistent with the
related Loan Documents and the Servicing Standard, to be in the best interests
of the Trust Fund, (ii) insurance providing coverage against 18 months (or such
longer period of time as is consistent with the Loan Documents and the Servicing
Standard) of rent interruptions and (iii) such other insurance as was required
pursuant to the terms of the related Mortgage Loan. All insurance for an REO
Property shall be from a Qualified Insurer. Any amounts collected by the Master
Servicer or the Special Servicer under any such policies (other than amounts
required to be applied to the restoration or repair of the related Mortgaged
Property or amounts to be released to the Borrower in accordance with the terms
of the related Loan Documents) shall be deposited into the Collection Account
pursuant to Section 3.05, subject to withdrawal pursuant to Section 3.06. Any
cost incurred by the Master Servicer or the Special Servicer in maintaining any
such insurance shall not, for the purpose of calculating distributions to
Certificateholders, be added to the unpaid principal balance of the related
Mortgage Loan, notwithstanding that the terms of such Mortgage Loan so permit.
It is understood and agreed that no other additional insurance other than flood
insurance or earthquake insurance subject to the conditions set forth below is
to be required of any Borrower or to be maintained by the Master Servicer other
than pursuant to the terms of the related Loan Documents and pursuant to such
applicable laws and regulations as shall at any time be in force and as shall
require such additional insurance. If the Mortgaged Property (other than an REO
Property) is located in a federally designated special flood hazard area, the
Master Servicer will use its best efforts to cause the related Borrower to
maintain, to the extent required by each Mortgage Loan, and if the related
Borrower does not so maintain, shall itself obtain (subject to the provisions of
this Agreement concerning Nonrecoverable Advances) and maintain flood insurance
in respect thereof to the extent available at commercially reasonable rates.
Such flood insurance shall be in an amount equal to the lesser of (i) the unpaid
principal balance of the related Mortgage Loan and (ii) the maximum amount of
such insurance required by the terms of the related Mortgage Loan and as is
available for the related property under the national flood insurance program
(assuming that the area in which such property is located is participating in
such program). If a Mortgaged Property is related to a Mortgage Loan pursuant to
which earthquake insurance was in place at the time of origination and is
required to be maintained pursuant to the terms of the Mortgage Loan, the Master
Servicer shall use its reasonable best efforts to cause the related Borrower to
maintain, and if the related Borrower does not so maintain will itself obtain
(subject to the provisions of this Agreement concerning Nonrecoverable Advances
and for so long as such insurance continues to be available at commercially
reasonable rates) and maintain earthquake insurance in respect thereof, in the
amount required by the Mortgage Loan or, if not specified, in-place at
origination and with substantially the same terms and provisions as the policy
in-place at origination or, if such a policy is unavailable at commercially
reasonable rates, with terms and provisions generally acceptable to commercial
mortgage servicers of mortgage loans similar to such Mortgage Loan. If an REO
Property (i) is located in a federally designated special flood hazard area or
(ii) is related to a Mortgage Loan pursuant to which earthquake insurance was in
place on the Closing Date and continues to be available at commercially
reasonable rates, the Special Servicer will obtain (subject to the provisions of
this Agreement concerning Nonrecoverable Advances) and maintain flood insurance
and/or earthquake insurance in respect thereof providing the same coverage as
described in the preceding sentences or, with respect to earthquake insurance,
in the amount required by the Mortgage Loan or, if not specified, in-place at
origination. If at any time during the term of this Agreement a recovery under a
flood or fire and hazard insurance policy in respect of an REO Property is not
available but would have been available if such insurance were maintained
thereon in accordance with the standards applied to Mortgaged Properties
described herein, the Special Servicer shall (subject to the provisions hereof
relating to Nonrecoverable Advances) either (i) immediately deposit into the
Collection Account from its own funds the amount that would have been recovered
(after taking into account the standard deductibles applicable to such insurance
policy) or (ii) apply to the restoration and repair of the property from its own
funds the amount that would have been recovered (after taking into account the
standard deductibles applicable to such insurance policy), if such application
would be consistent with the Servicing Standard; provided, however, that the
Special Servicer shall not be responsible for any shortfall in insurance
proceeds resulting from an insurer's refusal or inability to pay a claim. In the
case of any insurance otherwise required to be maintained pursuant to this
Section that is not being so maintained because the Master Servicer or the
Special Servicer, as applicable, has determined that it is not available at
commercially reasonable rates, the Master Servicer or the Special Servicer, as
applicable, shall deliver an Officers' Certificate to the Trustee, the Depositor
and each Rating Agency which details the steps that were taken in seeking such
insurance and the factors which led to the determination that such insurance was
not so available. Out-of-pocket expenses incurred by the Master Servicer or
Special Servicer in maintaining insurance policies pursuant to this Section 3.08
shall be paid by the Master Servicer or Special Servicer as a Property Advance
and shall be reimbursable to the Master Servicer or Special Servicer with
interest at the Advance Rate, except to the extent such expenses are paid from
the REO Account pursuant to Section 3.17(b). The Master Servicer (or the Special
Servicer, with respect to the Specially Serviced Mortgage Loans) agrees to
prepare and present, on behalf of itself, the Trustee and the
Certificateholders, claims under each related insurance policy maintained
pursuant to this Section 3.08(a) in a timely fashion in accordance with the
terms of such policy and to take such reasonable steps as are necessary to
receive payment or to permit recovery thereunder.
All insurance policies required hereunder shall name the Trustee, or the
Master Servicer or the Special Servicer on behalf of the Trustee, as the
mortgagee, as loss payee, and, unless otherwise required under the related Loan
Documents, or with respect to insurance maintained by a Borrower, otherwise
expressly permitted at the Borrower's election, shall be issued by Qualified
Insurers. Notwithstanding the foregoing, the Borrowers under the Wells Fargo
Office Tower Loan, the West Town Mall Loan, the Ramco-Gershenson Pool Loan, the
Courthouse Plaza I Loan and the Quail Springs Mall Loan shall, subject to
Section 3.25(o) hereof, be permitted to maintain property and rental loss
insurance with insurers other than Qualified Insurers, so long as (i) such
insurance is maintained with the same insurers as have issued such insurance to
such Borrower on the Cut-Off Date, as set forth in the "Current Insurance
Schedule" included as Exhibit J hereto, (ii) such insurance is maintained with
such insurers only to the same extent as was maintained on the Cut-Off Date, as
set forth in Exhibit J hereto, and (iii) such insurers maintain ratings from S&P
and Best at least as high as their ratings from S&P and Best on the Cut-Off
Date, as set forth in Exhibit J hereto.
(b) (I) If the Master Servicer or the Special Servicer, as applicable,
obtains and maintains a blanket insurance policy insuring against fire and
hazard losses on all of the Mortgaged Properties (other than REO Properties) as
to which the related Borrower has not maintained insurance required by the
related Mortgage Loan or on all of the REO Properties, as the case may be, it
shall conclusively be deemed to have satisfied its respective obligations
concerning the maintenance of insurance coverage set forth in Section 3.08(a).
Any such blanket insurance policy shall be maintained with a Qualified Insurer.
A blanket insurance policy may contain a deductible clause, in which case the
Master Servicer or the Special Servicer, as applicable, shall, in the event that
(i) there shall not have been maintained on the related Mortgaged Property a
policy otherwise complying with the provisions of Section 3.08(a), and (ii)
there shall have been one or more losses which would have been covered by such a
policy had it been maintained, immediately deposit into the Collection Account
from its own funds the amount not otherwise payable under the blanket policy
because of such deductible clause 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 which
is consistent with the Servicing Standard. In connection with its activities as
Master Servicer or the Special Servicer hereunder, as applicable, the Master
Servicer and the Special Servicer, respectively, agree to prepare and present,
on behalf of itself, the Trustee and Certificateholders, claims under any such
blanket policy which it maintains in a timely fashion in accordance with the
terms of such policy and to take such reasonable steps as are necessary to
receive payment or permit recovery thereunder.
(II) If the Master Servicer or the Special Servicer, as applicable, causes
any Mortgaged Property or REO Property to be covered by a master force placed
insurance policy and such policy shall be issued by a Qualified Insurer and
provide no less coverage in scope and amount for such Mortgaged Property or REO
Property than the insurance required to be maintained pursuant to Section
3.08(a), then the Master Servicer or Special Servicer shall conclusively be
deemed to have satisfied its respective obligations to maintain insurance
pursuant to Section 3.08(a). Such policy may contain a deductible clause, in
which case the Master Servicer or the Special Servicer, as applicable, shall, in
the event that (i) there shall not have been maintained on the related Mortgaged
Property or REO Property a policy otherwise complying with the provisions of
Section 3.08(a), and (ii) there shall have been one or more losses which would
have been covered by such a policy had it been maintained, immediately deposit
into the Collection Account from its own funds the amount not otherwise payable
under such policy because of such deductible 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 which is consistent with the Servicing Standard.
(c) The Master Servicer and the Special Servicer shall each maintain a
fidelity bond in the form and amount that would meet the servicing requirements
of FNMA or FHLMC, whichever is greater, with the Trustee named as
certificateholder or loss payee, as applicable thereunder. The Master Servicer
and the Special Servicer each shall be deemed to have complied with this
provision if one of its respective Affiliates has such fidelity bond coverage
and, by the terms of such fidelity bond, the coverage afforded thereunder
extends to the Master Servicer or the Special Servicer, as applicable. In
addition, the Master Servicer and the Special Servicer shall each keep in force
during the term of this Agreement a policy or policies of insurance covering
loss occasioned by the errors and omissions of its officers and employees in
connection with its obligations to service the Mortgage Loans hereunder in the
form and amount that would meet the servicing requirements of FNMA or FHLMC,
whichever is greater, with the Trustee named as certificateholder or loss payee,
as applicable thereunder. The Master Servicer and the Special Servicer shall
cause each and every sub-servicer for it to maintain, or cause to be maintained
by any agent or contractor servicing any Mortgage Loan on behalf of such
sub-servicer, a fidelity bond and an errors and omissions insurance policy which
satisfy the requirements for the fidelity bond and the errors and omissions
policy to be maintained by the Master Servicer pursuant to this Section 3.08(c).
All fidelity bonds and policies of errors and omissions insurance obtained under
this Section 3.08(c) shall be issued by a Qualified Insurer.
For so long as the long-term debt obligations of the Master
Servicer or Special Servicer, as the case may be (or their respective direct or
indirect parent), are rated "A" (or its equivalent) or better by all of the
Rating Agencies (or such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to the Certificates, as
evidenced in writing by the Rating Agencies), such Person may self-insure with
respect to the risks described in this subsection.
SECTION 3.09. Enforcement of Due-On-Sale Clauses; Assumption Agreements;
Defeasance Provisions.
(a) If any Mortgage Loan contains a provision in the nature of a
"due-on-sale" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the
mortgagee's option) become due and payable upon the sale or
other transfer of an interest in the related Mortgaged
Property or related Borrower, or
(ii) provides that such Mortgage Loan may not be assumed without
the consent of the related mortgagee in connection with any
such sale or other transfer,
then, for so long as such Mortgage Loan is included in the Trust Fund,
the Master Servicer or Special Servicer, as applicable, on behalf of the Trust
Fund shall not be required to enforce such due-on-sale clause and in connection
therewith shall not be required to (x) accelerate payments thereon or (y)
withhold its consent to such an assumption to the extent permitted under the
terms of the related Mortgage Loan if (x) such provision is not exercisable
under applicable law or such exercise is reasonably likely to result in
meritorious legal action by the related Borrower or (y) the Master Servicer or
Special Servicer, as applicable, determines, in accordance with the Servicing
Standard, that granting such consent would be likely to result in a greater
recovery, on a present value basis (discounting at the related Mortgage Rate),
than would enforcement of such clause. If the Master Servicer or Special
Servicer, as applicable, determines that granting of such consent would likely
result in a greater recovery, the Master Servicer or Special Servicer, as
applicable, is authorized to take or enter into an assumption agreement from or
with the Person to whom the related Mortgaged Property has been or is about to
be conveyed, and to release the original Borrower from liability upon the
Mortgage Loan and substitute the new Borrower as obligor thereon, provided, that
(a) the credit status of the prospective new Borrower is in compliance with the
Master Servicer's or Special Servicer's, as applicable, regular commercial
mortgage origination or servicing standards and criteria (as evidenced in
writing by the Master Servicer or Special Servicer) and the terms of the related
Mortgage and (b) the Master Servicer or Special Servicer has received written
confirmation from each Rating Agency that such assumption or substitution would
not, in and of itself, cause a downgrade, qualification or withdrawal of the
then current ratings assigned to the Certificates. In connection with each such
assumption or substitution entered into by the Special Servicer, the Special
Servicer shall give prior notice thereof to the Master Servicer. The Master
Servicer or Special Servicer, as applicable, shall notify the Trustee that any
such assumption or substitution agreement has been completed by forwarding to
the Trustee (with a copy to the Master Servicer, if applicable) the original
copy of such agreement, which copies shall be added to the related Mortgage File
and shall, for all purposes, be considered a part of such Mortgage File to the
same extent as all other documents and instruments constituting a part thereof.
Prior to waiving any "due on sale" clause, taking or entering into any
assumption agreement or permitting the release of a Borrower and substitution of
a new Borrower with respect to any Mortgage Loan, the Master Servicer shall
first provide to the Special Servicer a copy of its recommendation and the
materials upon which such recommendation is based and, subject to clause (b) of
the previous paragraph, shall not take such action unless it has received the
written consent of the Special Servicer, which consent shall be granted or
denied by the Special Servicer within five (5) Business Days (or, upon request
of the Special Servicer, such reasonably extended period) after the Special
Servicer's receipt of all information reasonably requested by the Special
Servicer with respect to such consent request. The Special Servicer's consent
shall be given or withheld in accordance with the Servicing Standard.
(b) Subject to Section 3.25(a), if any Mortgage Loan contains a provision
in the nature of a "due-on-encumbrance" clause, which by its terms:
(i) provides that such Mortgage Loan shall (or may at the
mortgagee's option) become due and payable upon the creation
of any lien or other encumbrance on the related Mortgaged
Property, or
(ii) requires the consent of the related mortgagee to the
creation of any such lien or other encumbrance on the
related Mortgaged Property,
then the Master Servicer or Special Servicer, as applicable, on behalf
of the Trust Fund, shall not be required to enforce such due-on-encumbrance
clause and in connection therewith will not be required to (i) accelerate the
payments on the related Mortgage Loan or (ii) withhold its consent to such lien
or encumbrance if in either case the Master Servicer or Special Servicer, as
applicable, (x) determines, in accordance with the Servicing Standard, that such
enforcement would not be in the best interests of the Trust Fund and (y)
receives prior written confirmation from each Rating Agency that granting such
consent would not, in and of itself, cause a downgrade, qualification or
withdrawal of any of the then current ratings assigned to the Certificates.
Prior to waiving any "due on encumbrance" clause, or permitting the
creation of any lien or other encumbrance on a Mortgaged Property, the Master
Servicer shall first provide to the Special Servicer a copy of its
recommendation and the materials upon which such recommendation is based and,
subject to clause (y) of the previous paragraph shall not take such action
unless it has received the written consent of the Special Servicer, which
consent shall be granted or denied by the Special Servicer within five (5)
Business Days (or, upon request of the Special Servicer, such reasonably
extended period) after the Special Servicer's receipt of all information
reasonably requested by the Special Servicer with respect to such consent
request. The Special Servicer's consent shall be given or withheld in accordance
with the Servicing Standard.
(c) Nothing in this Section 3.09 shall constitute a waiver of the Trustee's
right, as the mortgagee of record, to receive notice of any assumption of a
Mortgage Loan, any sale or other transfer of the related Mortgaged Property or
the creation of any lien or other encumbrance with respect to such Mortgaged
Property.
(d) In connection with the taking of, or the failure to take, any action
pursuant to this Section 3.09, neither the Master Servicer nor the Special
Servicer shall agree to modify, waive or amend, and no assumption or
substitution agreement entered into pursuant to Section 3.09(a) shall contain
any terms that are different from, any term of any Mortgage Loan or the related
Note, other than pursuant to Section 3.26.
(e) With respect to any Mortgage Loan which permits release of Mortgaged
Properties through defeasance, to the extent not inconsistent with the related
Loan Documents:
(i) In the event such Mortgage Loan requires that the Master
Servicer on behalf of the Trustee purchase the required U.S.
government obligations, the Master Servicer shall, at the
Borrower's expense, purchase such obligations in accordance
with the terms of such Mortgage Loan and hold the same on
behalf of the Trust Fund; provided, that the Master Servicer
shall not accept the amounts paid by the related Borrower to
effect defeasance until acceptable U.S. government
obligations have been identified.
(ii) The Master Servicer shall obtain an Opinion of Counsel
(which shall be an expense of the related Borrower) to the
effect that the Trustee has a first priority security
interest in the defeasance deposit and the U.S. government
obligations and the assignment thereof is valid and
enforceable; such opinion, together with any other
certificates or documents to be required in connection with
such defeasance shall be in form and substance acceptable to
the Master Servicer.
(iii) The Master Servicer shall obtain a certificate (which may be
conclusively relied upon by the Master Servicer) at the
related Borrower's expense from an Independent certified
public accountant certifying that the U.S. government
obligations comply with the requirements of the related Loan
Documents.
(iv) To the extent required by the related Loan Documents, prior
to permitting release of any Mortgaged Properties through
defeasance, the Master Servicer shall (at the Borrower's
expense) obtain written confirmation from each Rating Agency
that such defeasance would not, in and of itself, result in
a downgrade, qualification or withdrawal of the then current
ratings assigned to the Certificates.
(v) If the Mortgage Loan permits the lender or its designee to
cause an accommodation borrower to assume such defeased
obligations, the Master Servicer shall use its reasonable
best efforts to cause the related Borrower to establish at
such Borrower's cost and expense (and shall use its
reasonable best efforts to cause the related Borrower to
consent to such assumption) a special purpose entity to
assume such obligations, the establishment of which will
not, as evidenced in a writing of the Rating Agencies
delivered to the Trustee, in and of itself, result in the
downgrade, qualification or withdrawals of the ratings then
assigned to the Certificates.
(vi) To the extent not expressly inconsistent with the related
Loan Documents, prior to permitting release of any Mortgaged
Property through defeasance, the Master Servicer shall
obtain an Opinion of Counsel (which shall be an expense of
the related Borrower) to the effect that such release will
not cause either the Upper-Tier REMIC or Lower-Tier REMIC to
fail to qualify as a REMIC at any time that any Certificates
are outstanding or cause a tax to be imposed on the Trust
Fund under the REMIC Provisions.
SECTION 3.10. Realization Upon Defaulted Mortgage Loans.
(a) Within 60 days after the occurrence of an Appraisal Reduction Event,
the Special Servicer shall obtain an Updated Appraisal of the related Mortgaged
Property or REO Property, as the case may be, the costs of which shall be a
Property Advance to be advanced by the Master Servicer; provided, however, that
the Special Servicer shall not be required to obtain an Updated Appraisal of any
Mortgaged Property with respect to which there exists an appraisal which is less
than twelve months old; provided, further, however, that with respect to an
Appraisal Reduction Event enumerated in clause (ii) of the definition of
Appraisal Reduction Event, the Special Servicer shall obtain such appraisal no
later than 120 days following the date of the related delinquency. The Master
Servicer or Special Servicer, as applicable, shall obtain annual letter updates
to the Updated Appraisal or new Updated Appraisals, provided, that in the event
that the Master Servicer or Special Servicer, as applicable, becomes aware
pursuant to the financial and property reports, if any, collected from the
related Borrower that net operating income with respect to any Mortgaged
Property (calculated as provided in the related Loan Documents) has dropped by
more than 10% for any fiscal year or the debt service coverage ratio of any
Mortgaged Property (calculated as provided in the related Loan Documents) has
fallen below 1.2 (based on such fiscal year's financial statements), the Master
Servicer or Special Servicer, as applicable, shall obtain a new Updated
Appraisal.
Following a default in the payment of any principal balance and accrued
interest on the maturity date of a Mortgage Loan, either (x) the Master Servicer
shall continue to make P&I Advances (with respect to delinquent Extended Monthly
Payments or Monthly Payments, as applicable) in accordance with Section 3.10(j),
or (y) the Special Servicer shall foreclose or elect to grant up to three
consecutive one-year extensions of the Specially Serviced Mortgage Loan;
provided that the Special Servicer may only extend such Mortgage Loan if (i)
immediately prior to the default on the maturity date (or the first or second
anniversary thereof in the case of the second or third extension, respectively),
the related Borrower had made twelve consecutive Monthly Payments (or Extended
Monthly Payments (as defined herein) in the case of the second or third
extension) on or prior to their Due Dates, (ii) the Special Servicer determines
that (A) extension of such Mortgage Loan is consistent with the Servicing
Standard and (B) extension of such Mortgage Loan is likely to result in a
recovery which on a net present value basis would be greater than the recovery
that would result from a foreclosure, (iii) such extension requires that all
cash flow on all related Mortgage Properties in excess of amounts required to
operate and maintain such Mortgaged Properties be applied to payments of
principal and interest on such Mortgage Loan, (iv) the Special Servicer
terminates the related Manager unless the Special Servicer determines that
retaining such Manager is conducive to maintaining the value of such Mortgaged
Properties and (v) such extension requires the related Borrower to make Extended
Monthly Payments. The Special Servicer's determination to extend shall be made
in the Special Servicer's good faith judgment, and may, but is not required to
be, based on an Updated Appraisal or a letter update thereof. In addition, the
Special Servicer's determination set forth in clause (ii) above shall be
evidenced by an Officer's Certificate delivered to the Trustee and the
Depositor. The Officer's Certificate shall set forth the considerations of the
Special Servicer forming the basis of such determination (which shall include
but shall not be limited to information, to the extent available, such as
related income and expense statements, rent rolls, occupancy status, and
property inspections).
The Special Servicer will not agree to any extension of a Mortgage Loan
beyond the date which is two years prior to the Rated Final Distribution Date.
If the related Borrower fails to make an Extended Monthly Payment during the
initial extension period, no further extensions will be granted. In no event
will the Special Servicer be permitted to extend any Mortgage Loan at a rate
lower than the Mortgage Rate.
(b) In connection with any foreclosure, enforcement of the Loan Documents
or other acquisition, the Special Servicer shall pay the out-of-pocket costs and
expenses, including travel expenses, in any such proceedings as a Property
Advance unless the Special Servicer determines, in its good faith judgment, that
such Advance would constitute a Nonrecoverable Advance. The Special Servicer
shall be entitled to reimbursement of Advances (with interest at the Advance
Rate) made pursuant to the preceding sentence to the extent permitted by Section
3.06(ii).
If the Special Servicer elects to proceed with a non-judicial foreclosure
in accordance with the laws of the state where the Mortgaged Property is
located, the Special Servicer shall not be required to pursue a deficiency
judgment against the related Borrower or any other liable party if the laws of
the state do not permit such a deficiency judgment after a non-judicial
foreclosure or if the Special Servicer determines, in its best judgment, that
the likely recovery if a deficiency judgment is obtained will not be sufficient
to warrant the cost, time, expense and/or exposure of pursuing the deficiency
judgment and such determination is evidenced by an Officers' Certificate
delivered to the Trustee.
In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be issued to the Trustee, to a co-trustee or to its nominee (which shall
not include the Master Servicer) or a separate trustee or co-trustee on behalf
of the Trustee as Holder of the Lower-Tier Regular Interests and on behalf of
the Holders of the Certificates. Notwithstanding any such acquisition of title
and cancellation of the related Mortgage Loan, such Mortgage Loan shall (except
for purposes of Section 9.01) be considered to be a REO Mortgage Loan held in
the Trust Fund until such time as the related REO Property shall be sold by the
Trust Fund and shall be reduced only by collections net of expenses. Consistent
with the foregoing, for purposes of all calculations hereunder, so long as such
Mortgage Loan shall be considered to be an outstanding Mortgage Loan:
(i) it shall be assumed that, notwithstanding that the
indebtedness evidenced by the related Note shall have been
discharged, such Note and, for purposes of determining the
Stated Principal Balance thereof, the related amortization
schedule in effect at the time of any such acquisition of
title remain in effect; and
(ii) Net REO Proceeds received in any month shall be applied to
amounts that would have been payable under the related Note
in accordance with the terms of such Note. In the absence of
such terms, Net REO Proceeds shall be deemed to have been
received first in payment of the accrued interest (not
including Default Interest or Deferred Interest) that
remained unpaid on the date that the related REO Property
was acquired by the Trust Fund; second in respect of the
delinquent principal installments that remained unpaid on
such date; and thereafter, Net REO Proceeds received in any
month shall be applied to the payment of installments of
principal and accrued interest on such Mortgage Loan deemed
to be due and payable in accordance with the terms of such
Note and such amortization schedule. If such Net REO
Proceeds exceed the Monthly Payment then payable, the excess
shall be treated as a Principal Prepayment received in
respect of such Mortgage Loan.
(c) Notwithstanding any provision to the contrary, the Special Servicer
shall not acquire for the benefit of the Trust Fund any personal property
pursuant to this Section 3.10 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 for the benefit of the Trust Fund; or
(ii) the Special Servicer shall have requested and received an
Opinion of Counsel (which opinion shall be an expense of the
Trust Fund) to the effect that the holding of such personal
property by the Trust Fund will not cause the imposition of
a tax on the Lower-Tier REMIC or Upper-Tier REMIC under the
REMIC Provisions or cause the Lower-Tier REMIC or Upper-Tier
REMIC to fail to qualify as a REMIC at any time that any
Certificate is outstanding.
(d) Notwithstanding any provision to the contrary in this Agreement,
neither the Special Servicer nor the Master Servicer shall, on behalf of the
Trust Fund, obtain title to any direct or indirect partnership interest or other
equity interest in any Borrower pledged pursuant to any pledge agreement.
(e) Notwithstanding any provision to the contrary contained in this
Agreement, the Special Servicer shall not, on behalf of the Trust Fund, obtain
title to a Mortgaged Property as a result of or in lieu of foreclosure or
otherwise, obtain title to any direct or indirect partnership interest in any
Borrower pledged pursuant to a pledge agreement and thereby be the beneficial
owner of a Mortgaged Property, and shall not otherwise acquire possession of, or
take any other action with respect to, any Mortgaged Property if, as a result of
any such action, the Trustee, for the Trust Fund or the Certificateholders,
would 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
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended from time to time, or any comparable law, unless the Special
Servicer has previously determined in accordance with the Servicing Standard,
based on an updated environmental assessment report prepared by an Independent
Person who regularly conducts environmental audits, that:
(A) such Mortgaged Property is in compliance with applicable
environmental laws or, if not, after consultation with an
environmental consultant, that it would be in the best
economic interest of the Trust Fund to take such actions as
are necessary to bring such Mortgaged Property in compliance
therewith; and
(B) there are no circumstances present at such Mortgaged
Property relating to the use, management or disposal of any
Hazardous Materials for which investigation, testing,
monitoring, containment, clean-up or remediation could be
required under any currently effective federal, state or
local law or regulation, or that, if any such Hazardous
Materials are present for which such action could be
required, after consultation with an environmental
consultant, it would be in the best economic interest of the
Trust Fund to take such actions with respect to the affected
Mortgaged Property. In the event that the environmental
assessment first obtained by the Special Servicer with
respect to a Mortgaged Property indicates that such
Mortgaged Property may not be in compliance with applicable
environmental laws or that Hazardous Materials may be
present but does not definitively establish such fact, the
Special Servicer shall cause such further environmental
tests to be conducted by an Independent Person who regularly
conducts such tests as the Special Servicer shall deem
prudent to protect the interests of Certificateholders. Any
such tests shall be deemed part of the environmental
assessment obtained by the Special Servicer for purposes of
this Section 3.10.
(f) The environmental assessment contemplated by Section 3.10(e) shall be
prepared within two months of the determination that such assessment is required
by any Independent Person who regularly conducts environmental audits for
purchasers of commercial property where the Mortgaged Property is located, as
determined by the Special Servicer in a manner consistent with the Servicing
Standard. The Master Servicer shall pay as a Property Advance the cost of
preparation of such environmental assessments unless the Master Servicer
determines, in its good faith judgment, that such Advance would be a
Nonrecoverable Advance. The Master Servicer shall be entitled to reimbursement
of Advances (with interest at the Advance Rate) made pursuant to the preceding
sentence in the manner set forth in Section 3.06.
(g) If the Special Servicer determines pursuant to Section 3.10(e)(A) that
a Mortgaged Property is not in compliance with applicable environmental laws but
that it is in the best economic interest of the Trust Fund to take such actions
as are necessary to bring such Mortgaged Property in compliance therewith, or if
the Special Servicer determines pursuant to Section 3.10(e)(B) that the
circumstances referred to therein relating to Hazardous Materials are present
but that it is in the best economic interest of the Trust Fund to take such
action with respect to the containment, clean-up or remediation of Hazardous
Materials affecting such Mortgaged Property as is required by law or regulation,
the Special Servicer shall take such action as it deems to be in the best
economic interest of the Trust Fund, but only if the Trustee has mailed notice
to the Holders of the Regular Certificates of such proposed action, which notice
shall be prepared by the Special Servicer and delivered to the Trustee, and only
if the Trustee does not receive, within 30 days of such notification,
instructions from the Holders of greater than 50% of the aggregate Voting Rights
of such Classes directing the Special Servicer not to take such action. None of
the Trustee, the Master Servicer or the Special Servicer shall be obligated to
take any action or not take any action pursuant to this Section 3.10(g) at the
direction of the Certificateholders unless the Certificateholders agree to
indemnify the Trustee, the Master Servicer and the Special Servicer with respect
to such action or inaction. The Special Servicer shall pay as a Property Advance
the cost of any such compliance, containment, clean-up or remediation unless the
Special Servicer determines, in its good faith judgment, that such Advance would
constitute a Nonrecoverable Advance.
(h) The Special Servicer shall report to the IRS and to the related
Borrower, in the manner required by applicable law, the information required to
be reported regarding any Mortgaged Property which is abandoned or foreclosed.
The Special Servicer shall deliver a copy of any such report to the Trustee.
(i) The costs of any appraisal or annual letter update obtained pursuant
to this Section 3.10 shall be paid by the Master Servicer as an Advance and
shall be reimbursable from the Collection Account pursuant to Section 3.06.
(j) Following a default in the payment of principal or interest on a
Mortgage Loan, the Special Servicer, after consultation and agreement in writing
by the Master Servicer, may elect not to foreclose or institute similar
proceedings or to modify the loan pursuant to Section 3.26 and instead the
Master Servicer shall continue to make P&I Advances with respect to such
delinquencies so long as (i) the Special Servicer, in its reasonable judgment in
accordance with the Servicing Standard, after consultation and agreement in
writing by the Master Servicer, concludes that the election not to foreclose or
to modify would likely result in a greater recovery, on a present value basis,
than would foreclosure or modification and (ii) the Master Servicer, in its
reasonable judgment, in accordance with the Servicing Standard, concludes that
such P&I Advances will not be Nonrecoverable Advances.
SECTION 3.11. Trustee to Cooperate; Release of Mortgage Files.
Upon the payment in full of any Mortgage Loan, or the receipt by the Master
Servicer of a notification that payment in full has been escrowed in a manner
customary for such purposes, the Master Servicer shall immediately notify the
Trustee or the Custodian by a certification (which certification 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 3.05 have been or will be so deposited)
of a Servicing Officer and shall request delivery to it of the Mortgage File. No
expenses incurred in connection with any instrument of satisfaction or deed of
reconveyance shall be chargeable to the Trust Fund.
From time to time upon request of the Master Servicer or Special Servicer
and delivery to the Trustee and the Custodian of a Request for Release, the
Trustee shall promptly cause the Custodian to release the Mortgage File (or any
portion thereof) designated in such Request for Release to the Master Servicer
or Special Servicer, as applicable. Upon return of the foregoing to the
Custodian, or in the event of a liquidation or conversion of the Mortgage Loan
into an REO Property, receipt by the Trustee of a certificate of a Servicing
Officer stating that such Mortgage Loan was liquidated and that all amounts
received or to be received in connection with such liquidation which are
required to be deposited into the Collection Account or the Lower-Tier
Distribution Account, as applicable, have been so deposited, or that such
Mortgage Loan has become an REO Property, the Custodian shall deliver a copy of
the Request for Release to the Master Servicer or Special Servicer, as
applicable.
Upon written certification of a Servicing Officer, the Trustee shall
execute and deliver to the Special Servicer any court pleadings, requests for
trustee's sale or other documents prepared by the Special Servicer, its agents
or attorneys, 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
Borrower on the Mortgage Loan or to obtain a deficiency judgment, or to enforce
any other remedies or rights provided by the Loan Documents or otherwise
available at law or in equity. Each such certification shall include a request
that such pleadings or documents be executed by the Trustee and a statement as
to the reason such documents or pleadings are required, and that the execution
and delivery thereof by the Trustee will not invalidate or otherwise affect the
lien of the Mortgage or other security agreement, except for the termination of
such lien upon completion of the foreclosure or trustee's sale.
SECTION 3.12. Servicing Fees, Trustee Fees and Special
Servicing Compensation.
(a) As compensation for its activities hereunder, the Master Servicer shall
be entitled, with respect to each Mortgage Loan and each Interest Accrual
Period, to the Servicing Fee, which shall be payable from amounts on deposit in
the Collection Account as set forth in Section 3.06(iii). The Master Servicer's
rights to the Servicing Fee may not be transferred in whole or in part except in
connection with the transfer of all of the Master Servicer's responsibilities
and obligations under this Agreement. In addition, the Master Servicer shall be
entitled to receive, as additional servicing compensation, to the extent
permitted by applicable law and the related Mortgage Loans (i) any late payment
charges, loan service transaction fees, demand fees, beneficiary statement
charges or similar items (but not including any Net Default Interest or
Prepayment Premiums) and (ii) a portion of any Assumption Fees, forbearance fees
and extension fees pursuant to Section 3.12(d) below, in each case to the extent
received and not required to be deposited or retained in the Collection Account
pursuant to Section 3.05; provided, however, that the Master Servicer shall not
be entitled to apply or retain any amounts as additional compensation, including
any late payment charges, with respect to a specific Mortgage Loan with respect
to which a default or event of default thereunder has occurred and is continuing
unless and until such default or event of default has been cured and all
delinquent amounts (excluding any Default Interest) due with respect to such
Mortgage Loan have been paid. The Master Servicer shall also be entitled
pursuant to, and to the extent provided in, Sections 3.06(iii) and 3.07(b) to
withdraw from the Collection Account and to receive from any Borrower Accounts
(to the extent not payable to the related Borrower under the Mortgage Loan or
applicable law) any interest or other income earned on deposits therein.
Notwithstanding the foregoing, the aggregate Servicing Fee (minus the sum
of (i) the Trustee Fee, (ii) to the extent any Prepayment Interest Shortfall
with respect to such Distribution Date is a result of a prepayment on the
Glenborough Pool Loan, the related monthly pro-rated amount of the annual
surveillance fees of the Rating Agencies and (iii) the servicing fees of each of
the Initial Sub-servicers for such Distribution Date as reduced by the amount of
any Prepayment Interest Shortfall with respect to any of the Mortgage Loans
subserviced by such Initial Sub-servicer) due to the Master Servicer with
respect to any Distribution Date shall be reduced (but not below zero) by the
aggregate amount of any Prepayment Interest Shortfalls for the related
Collection Period.
As compensation for its activities hereunder, on each Distribution Date the
Trustee shall be entitled with respect to each Mortgage Loan to the Trustee Fee,
which shall be payable by the Master Servicer out of the aggregate Servicing
Fee. The Trustee shall pay the routine fees and expenses of the Certificate
Registrar, the Paying Agent, the Custodian and the Authenticating Agent. The
Trustee's rights to the Trustee Fee may not be transferred in whole or in part
except in connection with the transfer of all of the Trustee's responsibilities
and obligations under this Agreement.
Except as otherwise provided herein, the Master Servicer shall pay all
expenses incurred by it in connection with its servicing activities hereunder,
including all fees of any sub-servicers retained by it. Except as otherwise
provided herein, the Trustee shall pay all expenses incurred by it, the
Certificate Registrar, the Paying Agent, the Custodian and the Authenticating
Agent in connection with their activities hereunder.
(b) As compensation for its activities hereunder, the Special Servicer
shall be entitled with respect to each Specially Serviced Mortgage Loan to the
Special Servicing Fee, which shall be payable from amounts on deposit in the
Collection Account as set forth in Section 3.06(iii). The Special Servicer's
rights to the Special Servicing 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. In addition, the Special
Servicer shall be entitled to receive as additional servicing compensation, to
the extent permitted by applicable law and the related Specially Serviced
Mortgaged Loans (i) a portion of any Assumption Fees, forbearance fees and
extension fees pursuant to Section 3.12(d) below and (ii) any interest or other
income earned on deposits in the REO Accounts.
Except as otherwise provided herein, the Special Servicer shall pay all
expenses incurred by it in connection with its servicing activities hereunder.
(c) In addition to the Special Servicing Fees provided for in this
Agreement, and not in lieu thereof, the Special Servicer shall be entitled to
the following fees and compensation:
(i) the Special Servicing Rehabilitation Fee; and
(ii) the Liquidation Fee payable out of the Liquidation Proceeds
prior to the deposit of the Net Liquidation Proceeds in the
Collection Account. However, no Liquidation Fee will be
payable in connection with, or out of, Liquidation Proceeds
resulting from the purchase of any Specially Serviced
Mortgage Loan or REO Property (i) by MSMC, or (ii) by the
Master Servicer, the Depositor or the Certificateholders
pursuant to Section 2.03 or Section 9.01.
(d) As additional compensation for their activities hereunder, the Master
Servicer and the Special Servicer shall be entitled to a portion of any
Assumption Fees, forbearance fees and extension fees paid by or on behalf of a
Borrower in the following manner: (i) with respect to any Mortgage Loan that is
being serviced by the Master Servicer, the Master Servicer shall be entitled to
75% of such fees and the Special Servicer shall be entitled to 25% of such fees;
provided that the amount to which the Special Servicer is entitled to shall be
subject to a maximum of $10,000 and any excess thereof shall be payable to the
Master Servicer and (ii) with respect to any Specially Serviced Mortgage Loans,
the Special Servicer shall be entitled to 75% of such fees and the Master
Servicer shall be entitled to 25% of such fees; provided that the amount to
which the Master Servicer is entitled to shall be subject to a maximum of
$10,000 and any excess thereof shall be payable to the Special Servicer.
(e) The Master Servicer, Special Servicer and Trustee shall be entitled to
reimbursement from the Trust Fund for the costs and expenses incurred by them in
the performance of their duties under this Agreement which are "unanticipated
expenses incurred by the REMIC" within the meaning of Treasury Regulations
Section 1.860G-1(b)(3)(iii). Such expenses shall include, by way of example and
not by way of limitation, environmental assessments, Updated Appraisals and
appraisals in connection with foreclosure, the fees and expenses of any
administrative or judicial proceeding and expenses expressly identified as
reimbursable in Section 3.06(v).
(f) No provision of this Agreement or of the Certificates shall require the
Master Servicer, the Special Servicer or the Trustee to expend or risk their own
funds or otherwise incur any financial liability in the performance of any of
their duties hereunder or thereunder, or in the exercise of any of their rights
or powers, if, in the good faith business judgment of the Master Servicer,
Special Servicer or Trustee, as the case may be, repayment of such funds would
not be ultimately recoverable from late payments, Net Insurance Proceeds, Net
Liquidation Proceeds and other collections on or in respect of the Mortgage
Loans, or from adequate indemnity from other assets comprising the Trust Fund
against such risk or liability.
If the Master Servicer, the Special Servicer or the Trustee receives a
request or inquiry from a Borrower, any Certificateholder or any other Person
the response to which would, in the Master Servicer's, the Special Servicer's or
the Trustee's good faith business judgment require the assistance of Independent
legal counsel or other consultant to the Master Servicer, the Special Servicer
or the Trustee, the cost of which would not be an expense of the Trust Fund
hereunder, then the Master Servicer, the Special Servicer or the Trustee, as the
case may be, shall not be required to take any action in response to such
request or inquiry unless the Borrower or such Certificateholder or such other
Person, as applicable, makes arrangements for the payment of the Master
Servicer's, the Special Servicer's or Trustee's expenses associated with such
counsel (including, without limitation, posting an advance payment for such
expenses) satisfactory to the Master Servicer, the Special Servicer or the
Trustee, as the case may be, in its sole discretion. Unless such arrangements
have been made, the Master Servicer, the Special Servicer or the Trustee, as the
case may be, shall have no liability to any Person for the failure to respond to
such request or inquiry.
SECTION 3.13. Reports to the Trustee; Collection Account Statements.
(a) The Master Servicer shall deliver to the Trustee (solely for the
purposes of determining P&I Advances) no later than the fifth Business Day prior
to each Distribution Date a preliminary report containing the information
provided on the Master Servicer Remittance Report and by no later than 1:00 p.m.
New York City time on the second Business Day prior to each Distribution Date,
the Master Servicer Remittance Report with respect to the related Distribution
Date (which shall include, without limitation, a preliminary estimate of the
amount of Available Funds for such related Collection Period) including a
written statement of anticipated P&I Advances for the related Distribution Date.
The Master Servicer's responsibilities under this Section 3.13(a) with respect
to REO Mortgage Loans shall be subject to the satisfaction of the Special
Servicer's obligations under Section 3.24.
(b) Not later than fifteen days after each Distribution Date, the Master
Servicer shall forward to the Trustee a statement prepared by the Master
Servicer setting forth the status of the Collection Account as of the close of
business on the related Distribution Date and showing the aggregate amount of
deposits into and withdrawals from the Collection Account of each category of
deposit specified in Section 3.05 and each category of withdrawal specified in
Section 3.06 since the preceding Distribution Date. The Trustee and its agents
and attorneys may at any time during normal business hours, upon reasonable
notice, inspect and copy the books, records and accounts of the Master Servicer
solely relating to the Mortgage Loans and the performance of its duties
hereunder.
(c) Subject to Section 8.01(b) hereof, the Trustee shall be entitled to
rely conclusively on and shall not be responsible for the content or accuracy of
any information provided to it by the Master
Servicer or the Special Servicer pursuant to this Agreement.
SECTION 3.14. Annual Statement as to Compliance.
The Master Servicer and the Special Servicer (each, a "reporting person")
each shall deliver to the Trustee, the Depositor and to the Rating Agencies on
or before April 15 of each year, beginning with April 15, 1999, an Officers'
Certificate stating, as to each signatory thereof, (i) that a review of the
activities of the reporting person during the preceding calendar year (or such
shorter period from the Closing Date to the end of the related calendar year)
and of its performance under this Agreement has been made under such officer's
supervision, (ii) that, to the best of such officer's knowledge, based on such
review, the reporting person has fulfilled all of its obligations under this
Agreement in all material respects throughout such year (or such shorter
period), or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer, the nature and
status thereof and what action it proposes to take with respect thereto, (iii)
that, to the best of such officer's knowledge, each sub-servicer has fulfilled
its obligations under its sub-servicing agreement in all material respects, or,
if there has been a material default in the fulfillment of such obligations,
specifying each such default known to such officer and the nature and status
thereof, (iv) that it has maintained an effective internal control system over
the servicing of mortgage loans including the Mortgage Loans and other loans,
and (v) whether it has received any notice regarding qualification, or
challenging the status, of the Upper-Tier REMIC or Lower-Tier REMIC as a REMIC
from the IRS or any other governmental agency or body.
SECTION 3.15. Annual Independent Public Accountants' Servicing Report.
On or before April 15 of each year, beginning with April 15, 1999, the
Master Servicer and the Special Servicer (each, a "reporting person") at its own
expense shall cause a firm of nationally recognized Independent public
accountants (who may also render other services to the reporting person) which
is a member of the American Institute of Certified Public Accountants to furnish
a statement (an "Accountant's Statement") to the Trustee, to the effect that the
assertion of management of the Master Servicer or the Special Servicer that it
has maintained an effective internal control system over the servicing of
mortgage loans including the Mortgage Loans and other loans, for the preceding
calendar year (or shorter period from the Closing Date to the end of the related
calendar year) is fairly stated, based on an examination conducted substantially
in compliance with the Uniform Single Attestation Program for Mortgage Bankers
or the Audit Program for Mortgages serviced for FHLMC, except for exceptions and
errors as stated in such report.
SECTION 3.16. Access to Certain Documentation.
The Master Servicer and Special Servicer shall provide to any
Certificateholders that are federally insured financial institutions, the
Federal Reserve Board, the FDIC and the OTS and the supervisory agents and
examiners of such boards and such corporations, and any other governmental or
regulatory body to the jurisdiction of which any Certificateholder is subject,
access to the documentation regarding the Mortgage Loans required by applicable
regulations of the Federal Reserve Board, FDIC, OTS or any such governmental or
regulatory body, such access being afforded without charge but only upon
reasonable request and during normal business hours at the offices of the Master
Servicer or Special Servicer. Nothing in this Section 3.16 shall detract from
the obligation of the Master Servicer and Special Servicer to observe any
applicable law prohibiting disclosure of information with respect to the
Borrowers, and the failure of the Master Servicer and Special Servicer to
provide access as provided in this Section 3.16 as a result of such obligation
shall not constitute a breach of this Section 3.16.
SECTION 3.17. Title and Management of REO Properties.
(a) In the event that title to any Mortgaged Property is acquired for the
benefit of Certificateholders in foreclosure, by deed in lieu of foreclosure or
upon abandonment or reclamation from bankruptcy, the deed or certificate of sale
shall be taken in the name of the Trustee, or its nominee (which shall not
include the Master Servicer), or a separate trustee or co-trustee, on behalf of
the Trust Fund. The Special Servicer, on behalf of the Trust Fund, shall dispose
of any REO Property prior to the close of the third calendar year following the
year in which the Trust Fund acquires ownership of such REO Property for
purposes of Section 860G(a)(8) of the Code, unless (i) the Special Servicer on
behalf of the Lower-Tier REMIC has applied for an extension of such period
pursuant to Sections 856(e)(3) and 860G(a)(8)(A) of the Code, in which case the
Special Servicer shall sell such REO Property within the applicable extension
period or (ii) the Special Servicer seeks and subsequently receives an Opinion
of Counsel (which opinion shall be an expense of the Trust Fund), addressed to
the Special Servicer and Trustee, to the effect that the holding by the Trust
Fund of such REO Property for an additional specified period will not cause such
REO Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of Section 860D(a) of the Code) at any time that any
Certificate is outstanding, in which event such period shall be extended by such
additional specified period subject to any conditions set forth in such Opinion
of Counsel. The Special Servicer, on behalf of the Trust Fund, shall dispose of
any REO Property held by the Trust Fund prior to the last day of such period
(taking into account extensions) by which such REO Property is required to be
disposed of pursuant to the provisions of the immediately preceding sentence in
a manner provided under Section 3.18 hereof. The Special Servicer shall manage,
conserve, protect and operate each REO Property for the Certificateholders
solely for the purpose of its prompt disposition and sale in a manner which does
not cause such REO Property to fail to qualify as "foreclosure property" within
the meaning of Section 860G(a)(8) of the Code (determined without regard to the
exception applicable for purposes of Section 860D(a)).
(b) The Special Servicer shall have full power and authority, subject only
to the specific requirements and prohibitions of this Agreement, to do any and
all things in connection with any REO Property as are consistent with the
Servicing Standard and the terms of this Agreement, all on such terms and for
such period as the Special Servicer deems to be in the best interests of
Certificateholders, and, in connection therewith, the Special Servicer shall
only agree to the payment of management fees that are consistent with general
market standards or to terms that are more favorable to the Trust Fund.
Consistent with the foregoing, the Special Servicer shall cause or permit to be
earned with respect to such REO Property any "net income from foreclosure
property," within the meaning of Section 860G(c) of the Code, which is subject
to tax under the REMIC Provisions only if it has determined, and has so advised
the Trustee in writing, that the earning of such income on a net after-tax basis
could reasonably be expected to result in a greater recovery on behalf of
Certificateholders than an alternative method of operation or rental of such REO
Property that would not be subject to such a tax. The Special Servicer shall
segregate and hold all revenues received by it with respect to any REO Property
separate and apart from its own funds and general assets and shall establish and
maintain with respect to any REO Property a segregated custodial account (each,
an "REO Account"), each of which shall be an Eligible Account and shall be
entitled "Clarion Partners, LLC, in trust for State Street Bank and Trust
Company, as Trustee, in trust for Holders of Morgan Stanley Capital I Inc.,
Commercial Mortgage Pass-Through Certificates, Series 1998-XL1, REO Account."
The Special Servicer shall be entitled to withdraw for its account any interest
or investment income earned on funds deposited in an REO Account to the extent
provided in Section 3.07(b). The Special Servicer shall deposit or cause to be
deposited in the REO Account within one Business Day after receipt all revenues
received by it with respect to any REO Property (other than Liquidation
Proceeds, which shall be remitted pursuant to Section 3.18(e) to the Collection
Account), and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of such REO Property and for other Property
Protection Expenses with respect to such REO Property, including:
(i) all insurance premiums due and payable in respect of any REO
Property;
(ii) all real estate taxes and assessments in respect of any REO
Property that may result in the imposition of a lien
thereon;
(iii) all costs and expenses reasonable and necessary to protect,
maintain, manage, operate, repair and restore any REO
Property; and
(iv) any taxes imposed on the Upper Tier REMIC or Lower-Tier
REMIC in respect of net income from foreclosure property in
accordance with Section 4.05.
To the extent that such REO Proceeds are insufficient for the purposes set
forth in clauses (i) through (iii) above and the Special Servicer has provided
written notice of such shortfall to the Master Servicer at least five Business
Days prior to the date that such amounts are due, the Master Servicer shall pay
as a Property Advance the amount of such shortfall unless the Master Servicer
determines, in its good faith judgment, that such Advance would be a
Nonrecoverable Advance. If the Master Servicer does not make any such Advance in
violation of the immediately preceding sentence, the Trustee shall make such
Advance, unless in either case, the Trustee determines that such Advance would
be a Nonrecoverable Advance. The Trustee shall be entitled to rely,
conclusively, on any determination by the Master Servicer that an Advance, if
made, would be a Nonrecoverable Advance. The Trustee, in determining whether or
not a proposed Advance would be a Nonrecoverable Advance, shall be subject to
the standards applicable to the Master Servicer hereunder. The Master Servicer
or the Trustee, as applicable, shall be entitled to reimbursement of such
Advances (with interest at the Advance Rate) made pursuant to the preceding
sentence, to the extent set forth in Section 3.06. The Special Servicer shall
withdraw from each REO Account and remit to the Master Servicer for deposit into
the Collection Account on a monthly basis prior to the related Master Servicer
Remittance Date the Net REO Proceeds received or collected from each REO
Property, except that in determining the amount of such Net REO Proceeds, the
Special Servicer may retain in each REO Account reasonable reserves for repairs,
replacements and necessary capital improvements and other related expenses.
Notwithstanding the foregoing, the Special Servicer shall not:
(i) permit the Trust Fund to enter into, renew or extend any New
Lease, if the New Lease by its terms will give rise to any
income that does not constitute Rents from Real Property;
(ii) permit any amount to be received or accrued under any New
Lease, other than amounts that will constitute Rents from
Real Property;
(iii) authorize or permit any construction on any REO Property,
other than the repair or maintenance thereof or the
completion of a building or other improvement thereon, and
then only if more than ten percent of the construction of
such building or other improvement was completed before
default on the related Mortgage Loan became imminent, all
within the meaning of Section 856(e)(4)(B) of the Code; or
(iv) Directly Operate or allow any Person to Directly Operate any
REO Property on any date more than 90 days after its date of
acquisition by the Trust Fund, unless such Person is an
Independent Contractor;
unless, in any such case, the Special Servicer has requested and received an
Opinion of Counsel addressed to the Special Servicer and the Trustee (which
opinion shall be an expense of the Trust Fund) to the effect that such action
will not cause such REO Property to fail to qualify as "foreclosure property"
within the meaning of Section 860G(a)(8) of the Code (determined without regard
to the exception applicable for purposes of Section 860D(a) of the Code) at any
time that it is held by the Trust Fund, in which case the Special Servicer may
take such actions as are specified in such Opinion of Counsel.
The Special Servicer shall be required to contract with an Independent
Contractor, the fees and expenses of which shall be an expense of the Trust Fund
and payable out of REO Proceeds, for the operation and management of any REO
Property, within 90 days of the Trust Fund's acquisition thereof (unless the
Special Servicer shall have provided the Trustee with an Opinion of Counsel that
the operation and management of any REO Property other than through an
Independent Contractor shall not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Code Section 860G(a)(8)) (which
opinion shall be an expense of the Trust Fund), provided that:
(i) the terms and conditions of any such contract shall be
reasonable and customary for the area and type of property
and shall not be inconsistent herewith;
(ii) any such contract shall require, or shall be administered to
require, that the Independent Contractor pay all costs and
expenses incurred in connection with the operation and
management of such REO Property, including those listed
above, and remit all related revenues (net of such costs and
expenses) to the Special Servicer as soon as practicable,
but in no event later than thirty days following the receipt
thereof by such Independent Contractor;
(iii) none of the provisions of this Section 3.17(b) 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 to the
Trust Fund or the Trustee on behalf of the
Certificateholders with respect to the operation and
management of any such REO Property; and
(iv) 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 such indemnification.
(c) When and as necessary, the Special Servicer shall send to the Trustee a
statement prepared by the Special Servicer setting forth the amount of net
income or net loss, as determined for federal income tax purposes, resulting
from the operation and management of a trade or business on, the furnishing or
rendering of a non-customary service to the tenants of, or the receipt of any
other amount not constituting Rents from Real Property in respect of, any REO
Property in accordance with Sections 3.17(a) and 3.17(b).
SECTION 3.18. Sale of Specially Serviced Mortgage Loans and REO Properties.
(a) With respect to any Specially Serviced Mortgage Loan or REO Property
which the Special Servicer has determined to sell in accordance with Section
3.10, the Special Servicer shall deliver to the Trustee an Officers' Certificate
to the effect that, pursuant to Section 3.10, the Special Servicer has
determined to sell such Specially Serviced Mortgage Loan or REO Property in
accordance with this Section 3.18. The Special Servicer may then offer to sell
to any Person any Specially Serviced Mortgage Loan which is in default or for
which default is reasonably foreseeable or any REO Property or, subject to the
following sentence, purchase any such Specially Serviced Mortgage Loan or REO
Property (in each case at the Repurchase Price therefor), but shall, in any
event, so offer to sell any REO Property no later than the time determined by
the Special Servicer to be sufficient to result in the sale of such REO Property
within the period specified in Section 3.17(a). The Special Servicer shall
deliver such Officers' Certificate and give the Trustee not less than five
Business Days' prior written notice of its intention to sell any Specially
Serviced Mortgage Loan or REO Property, in which case the Special Servicer shall
accept the highest offer received from any Person for any Specially Serviced
Mortgage Loan or any REO Property in an amount at least equal to the Repurchase
Price therefor or, at its option, if it has received no offer (of at least three
offers) at least equal to the Repurchase Price therefor, purchase the Specially
Serviced Mortgage Loan or REO Property at the Repurchase Price.
In the absence of any such offer or purchase by the Special Servicer, the
Special Servicer shall accept the highest offer received from any Person that is
determined by the Special Servicer to be a fair price, as determined in
accordance with Section 3.18(b), for such Specially Serviced Mortgage Loan or
REO Property, if the highest offeror is a Person other than an Interested
Person, or if such offer is determined to be a fair price by the Trustee in
accordance with Section 3.18(b), if the highest offeror is an Interested Person;
provided, that the Trustee shall be entitled to engage, at the expense of the
Trust Fund, an Independent appraiser to determine whether the highest offer is a
fair price and, further provided, that if the highest offeror is an Interested
Person such offer shall not be accepted if it is less than the Repurchase Price,
unless the Rating Agencies have confirmed, in writing, that such acceptance will
not, in itself, result in the qualification, downgrade or withdrawal of the then
current ratings assigned to the Certificates. Notwithstanding anything to the
contrary herein, neither the Trustee, in its individual capacity, nor any of its
Affiliates may make an offer or purchase any Specially Serviced Mortgage Loan or
any REO Property pursuant hereto.
The Special Servicer shall not be obligated by either of the foregoing
paragraphs or otherwise to accept the highest offer if the Special Servicer
determines, in accordance with the Servicing Standard, that rejection of such
offer would be in the best interests of the Certificateholders. In addition, the
Special Servicer may accept a lower offer if it determines, in accordance with
the Servicing Standard, that acceptance of such offer would be in the best
interests of the Certificateholders (for example, if the prospective buyer
making the lower offer is more likely to perform its obligations, or the terms
offered by the prospective buyer making the lower offer are more favorable),
provided that the offeror is not the Special Servicer or an Affiliate of the
Special Servicer.
In the event that the Special Servicer determines with respect to any REO
Property that the offers being made with respect thereto are not in the best
interests of the Certificateholders and that the end of the period referred to
in Section 3.17(a) with respect to such REO Property is approaching, the Special
Servicer shall seek an extension of such period in the manner described in
Section 3.17(a); provided, however, that the Special Servicer shall use its best
efforts, consistent with the Servicing Standard, to sell each Specially Serviced
Mortgage Loan and any REO Property prior to the Rated Final Distribution Date.
(b) In determining whether any offer received from an Interested Person
represents a fair price for any Specially Serviced Mortgage Loan or any REO
Property, the Trustee may conclusively rely on the opinion of an Independent
appraiser. In determining whether any offer constitutes a fair price for any
Specially Serviced Mortgage Loan or any REO Property, the Special Servicer (if
the highest offeror is not an Interested Person) or the Trustee shall take into
account, and any appraiser or other expert in real estate matters shall be
instructed to take into account, as applicable, among other factors, any Updated
Appraisal previously obtained, the period and amount of any delinquency on the
affected Specially Serviced Mortgage Loan, the physical (including
environmental) condition of the related Mortgaged Property or such REO Property,
the state of the local economy and the Trust Fund's obligation to dispose of any
REO Property within the time period specified in Section 3.17(a).
(c) Subject to the provisions of Section 3.17, the Special Servicer shall
act on behalf of the Trust Fund in negotiating and taking any other action
necessary or appropriate in connection with the sale of any Specially Serviced
Mortgage Loan or REO Property, including the collection of all amounts payable
in connection therewith. Any sale of a Specially Serviced Mortgage Loan or any
REO Property shall be without recourse to, or representation or warranty by, the
Trustee, the Depositor, the Master Servicer, the Special Servicer or the Trust
Fund (except that any contract of sale and assignment and conveyance documents
may contain customary warranties of title, so long as the only recourse for
breach thereof is to the Trust Fund), and, if such sale is consummated in
accordance with the duties of the Special Servicer, the Master Servicer, the
Depositor and the Trustee pursuant to the terms of this Agreement, no such
Person who so performed shall have any liability to the Trust Fund or any
Certificateholder with respect to the purchase price therefor accepted by the
Special Servicer, if the offeror is not an Interested Person (or the Trustee, if
an Interested Person is an offeror).
(d) The Special Servicer shall file information returns regarding the
abandonment or foreclosure of Mortgaged Properties with the IRS at the time and
in the manner required by the Code.
(e) The proceeds of any sale pursuant to this Section 3.18 after deduction
of the expenses of such sale incurred in connection therewith shall be promptly,
and in any event within one Business Day following receipt thereof, remitted by
the Special Servicer to the Master Servicer for deposit in the Collection
Account in accordance with Section 3.05(a)(iv).
SECTION 3.19. Additional Obligations of the Master Servicer; Inspections;
Successor Manager.
(a) The Master Servicer (or, with respect to Specially Serviced Mortgage
Loans and REO Properties, the Special Servicer) shall inspect or cause to be
inspected each Mortgaged Property at such times and in such manner as are
consistent with the Servicing Standard, but in any event shall inspect each
Mortgaged Property (i) with an Allocated Loan Amount of (A) $5,000,000 or more
at least once every 12 months and (B) less than $5,000,000 at least once every
24 months (provided, however, that at least 50% of the Mortgaged Properties with
an Allocated Loan Amount of less than $5,000,000 with respect to each Mortgage
Loan shall be inspected within the initial 12 months after the Closing Date), in
each case commencing in June, 1999 (or at such lesser frequency as each Rating
Agency shall have confirmed in writing to the Master Servicer will not result in
a downgrade, qualification or withdrawal of the then current ratings assigned to
any Class of the Certificates) and (ii) if any Mortgage Loan (A) becomes a
Specially Serviced Mortgage Loan or (B) has a debt service coverage ratio
(calculated as provided in the related Loan Documents) of less than 1.0 for the
immediately preceding twelve-month period, the related Mortgaged Property shall
be inspected by the Master Servicer (or the Special Servicer with respect to
Specially Serviced Mortgage Loans) as soon as practicable and thereafter at
least every 12 months for so long as such condition exists. The cost of any such
inspection shall be borne by the Master Servicer unless the related Mortgage
Loan is a Specially Serviced Mortgage Loan, in which case any out-of-pocket
costs, including travel related expenses, incurred with respect to such
inspection by the Special Servicer shall be paid by the Master Servicer as a
Property Advance.
(b) With respect to each Mortgage Loan, the Master Servicer and the Special
Servicer (with respect to Specially Serviced Mortgage Loans) shall enforce the
Trustee's rights with respect to the Manager or Managers under the related Loan
Documents and Management Agreement or Management Agreements. In the event the
Master Servicer or the Special Servicer (with respect to Specially Serviced
Mortgage Loans) is entitled to terminate or cause the related Borrower to
terminate the Manager or Managers, and the Master Servicer or Special Servicer,
as applicable, has determined, in accordance with the Servicing Standard, that
such termination is appropriate, the Master Servicer or the Special Servicer, as
the case may be, shall promptly give notice of its intent to exercise its right
to terminate the Manager or Managers to the Trustee (who shall copy the
Certificateholders and the Rating Agencies), the related Originator, the Master
Servicer or Special Servicer, as applicable, and the Depositor. After receipt of
such notice, the most subordinate Class of Certificates then outstanding shall
have the right to recommend termination of the Manager or Managers, and if so,
to recommend a Successor Manager or Managers (meeting the requirements set forth
below). Certificateholders representing Voting Rights of greater than 50% of
such subordinate Class of Certificates will have ten Business Days from the
receipt of such notice to respond to such notice. Upon receipt of a
recommendation to terminate the Manager or Managers and appoint a Successor
Manager or Managers, the Master Servicer or the Special Servicer, as the case
may be, shall give notice of such recommendation to the Trustee (who shall copy
the Certificateholders), and the Master Servicer or Special Servicer, as
applicable, shall effect such recommendation unless: (i) within five Business
Days of the receipt of notice of such recommendation, Certificateholders
representing Voting Rights of greater than 50% of any Class of Certificates then
outstanding which was assigned a rating by any Rating Agency on the Closing Date
reject (in writing delivered to the Trustee) such proposed Successor Manager or
Managers in which case the Master Servicer or the Special Servicer, as the case
may be, shall procure a Successor Manager or Managers as set forth in the
following sentence; or (ii) the Master Servicer or the Special Servicer, as the
case may be, determines that effecting such recommendation to terminate is not
consistent with the Servicing Standard, and therefore, the Master Servicer or
the Special Servicer, as the case may be, elects not to effect such
recommendation. If the Master Servicer or the Special Servicer, as the case may
be, does not receive a required response (or if the response received is
inconsistent) and the Master Servicer or Special Servicer, as the case may be,
determines it is consistent with the Servicing Standard to terminate the Manager
or Managers or in the event the Manager or Managers is otherwise terminated or
resigns under the related Mortgage or Management Agreement, the Master Servicer
or the Special Servicer, as the case may be, shall use its best efforts to
retain a Successor Manager or Managers (or the recommended Successor Manager or
Managers, if any) on terms substantially similar to the Management Agreement or,
failing that, on terms as favorable to the Trust Fund as can reasonably be
obtained. A "Successor Manager" shall be reasonably acceptable to the Master
Servicer or the Special Servicer, as the case may be, and shall be a
professional management corporation or business entity which (i) manages, and is
experienced in managing, other comparable commercial properties, (ii) will not
result in a downgrade, qualification or withdrawal of the then current ratings
assigned to the Certificates by each Rating Agency, as confirmed in writing by
each Rating Agency, and (iii) otherwise satisfies any criteria set forth in the
Mortgage and related Loan Documents.
SECTION 3.20. Reports to the Securities and Exchange Commission;
Available Information.
(a) The Trustee shall prepare, sign, and electronically file on behalf of
the Depositor, and at the expense of the Depositor, any and all Exchange Act
Reports as may be required with respect to the Certificates pursuant to this
Agreement; provided, however, that the Depositor shall prepare, sign and file
with the Commission the initial Form 8-K relating to the Trust Fund. In the
event the Depositor notifies the Trustee, the Master Servicer and the Special
Servicer in writing as to any change in the Exchange Act reporting requirements
applicable to the Certificates, the Trustee, the Special Servicer and the Master
Servicer shall conform the reporting obligations as set forth herein to any such
changes as notified by the Depositor. The Master Servicer and the Special
Servicer, to the extent such information has been received by the Master
Servicer or Special Servicer, as applicable, agree to provide such information
with respect to the Mortgage Loans to the Trustee and such entity as is
designated by the Depositor pursuant to Section 3.20(f) in a timely fashion as
may be requested by the Trustee in connection with such Exchange Act Reports, so
that such Exchange Act Reports may be timely filed by the Trustee.
Manually-signed copies of each Exchange Act Report shall be delivered by the
Trustee to the Depositor to the attention of the Secretary (or such other
Persons as are designated in writing by the Depositor).
On a monthly basis prior to the filing on behalf of the Trust Fund of a
Form 15, the Trustee will file on behalf of the Trust Fund within 15 days after
the Distribution Date a Form 8-K that includes the Monthly Distribution
Statement.
On a quarterly basis prior to the filing on behalf of the Trust Fund, and
effectiveness, of a Form 15, the Trustee will file, to the extent the Trustee
receives the information set forth below in electronic format in accordance with
Section 3.20(f), within 45 days after the end of the relevant Borrower's fiscal
quarter a Financial Report for those Borrowers which represent 10% or more of
the aggregate Stated Principal Balance of the Mortgage Loans (on the date
hereof, the Hotel Del Coronado Loan, the CenterAmerica Pool Loan and the Wells
Fargo Office Tower Loan). The quarterly Financial Report with respect to (i)
those Mortgage Loans that represent 20% or more of the aggregate Stated
Principal Balance of the Mortgage Loans (on the date hereof no Mortgage Loan
represents 20% or more of the aggregate Stated Principal Balance of the Mortgage
Loans) shall consist of unaudited financial statements with respect to the
Mortgaged Properties securing such Mortgage Loans, and (ii) those Mortgage Loans
that represent 10% but less than 20% of the aggregate Stated Principal Balance
of the Mortgage Loans (on the date hereof, the Hotel Del Coronado Loan, the
CenterAmerica Pool Loan and the Wells Fargo Office Tower Loan) shall consist of
summarized quarterly financial information (substantially in the form set forth
in Exhibit A-1, Exhibit A-2 and Exhibit A-3, respectively, to the Depositor's
Prospectus Supplement dated June 1, 1998 relating to the Certificates) as
described in Rule 1.02(bb) of Regulation S-X with respect to the Mortgaged
Properties securing such Mortgage Loan.
On an annual basis prior to the filing on behalf of the Trust Fund, and
effectiveness, of a Form 15, the Trustee will file, to the extent the Trustee
receives the information set forth below in electronic format in accordance with
Section 3.20(f), within 90 days after the end of the relevant Borrower's fiscal
year end a Financial Report for those Borrowers which represent 10% or more of
the aggregate Stated Principal Balance of the Mortgage Loans (on the date
hereof, the Hotel Del Coronado Loan, the CenterAmerica Pool Loan and the Wells
Fargo Office Tower Loan). The annual Financial Report with respect to (i) those
Mortgage Loans that represent 20% or more of the aggregate Stated Principal
Balance of the Mortgage Loans (on the date hereof, no Mortgage Loan represents
20% or more of the aggregate Stated Principal Balance of the Mortgage Loans)
shall consist of audited financial statements with respect to the Mortgaged
Properties securing such Mortgage Loans, and (ii) those Mortgage Loans that
represent 10% but less than 20% of the aggregate Stated Principal Balance of the
Mortgage Loans (on the date hereof, the Hotel Del Coronado Loan, the
CenterAmerica Pool Loan and the Wells Fargo Office Tower Loan) shall consist of
summarized annual financial information (substantially in the form set forth in
Exhibit A-1, Exhibit A-2 and Exhibit A-3, respectively, to the Depositor's
Prospectus Supplement dated June 1, 1998 relating to the Certificates) as
described in Rule 1.02(bb) of Regulation S-X with respect to the Mortgaged
Properties securing such Mortgage Loan.
The Master Servicer, each Special Servicer and the Trustee hereby agree to
cooperate with the Borrowers and their accountants in obtaining any consents of
accountants that are required to be filed with any financial statements being
filed on a Form 10-K or Form 8-K.
If information for any Financial Report is incomplete by the date on which
required to be filed, the Trustee shall prepare, execute and file a Form 12b-25
and shall deliver a manually signed version of such form to the Depositor to the
attention of the Secretary (or such other Persons as are designated in writing
by the Depositor).
None of the Master Servicer, the Special Servicer and the Trustee shall (i)
file a Form ID with respect to the Depositor or (ii) cause the Trust Fund to
stop filing reports, statements and information with the Commission pursuant to
this Section unless directed to do so by the Depositor or the continued
reporting is prohibited under the Exchange Act or any regulations thereunder.
Promptly following the end of each calendar year, commencing December 31, 1998,
the Trustee shall notify the Depositor when the Certificates are held of record
by less than 300 persons within the meaning of Section 15(d) of the Exchange
Act. Upon receipt of such notice from the Trustee, the Depositor may instruct
the Trustee to file a Form 15, in which case the Trustee shall file a Form 15
within 15 days following the receipt of such instructions from the Depositor,
whereupon the Trustee's responsibilities under this Section 3.20(a) shall end.
The Trustee shall, at the written direction of the Depositor, solicit any
and all proxies of the Certificateholders whenever such proxies are required to
be solicited pursuant to the Exchange Act.
(b) Prior to the filing on behalf of the Trust Fund, and effectiveness, of
a Form 15, the Master Servicer shall promptly prepare and provide to the Trustee
and the Special Servicer a report (each, a "Special Event Report") reporting (i)
any notice from a Borrower or insurance company, or any knowledge otherwise
obtained, regarding an upcoming voluntary or involuntary prepayment (including
that resulting from a casualty or condemnation) or defeasance of all or part of
the related Mortgage Loan (provided that a request by a Borrower or other Person
for a quotation of the amount necessary to satisfy all obligations with respect
to a Mortgage Loan shall not, in and of itself, be deemed to be such notice);
(ii) any imminent or actual monetary default or other default on a Mortgage Loan
the results of which the Master Servicer, after consultation with the Special
Servicer, reasonably believes is likely to result in the acceleration of the
indebtedness due under such Mortgage Loan; (iii) the results of any property
inspection of which the Master Servicer has knowledge and which has revealed any
material damage or deterioration or the presence of any environmental condition
with respect to any Mortgaged Property; (iv) any notice from a Borrower, or any
knowledge otherwise obtained, regarding any litigation involving such Borrower
or any related Mortgaged Property which the Master Servicer reasonably believes
is likely to have an adverse effect on the Mortgaged Property or the ability of
such Borrower to pay the amounts due under the related Mortgage Loan; (v) any
notice received from a Borrower, Manager or Managers or tenant of a Mortgaged
Property, or any knowledge otherwise obtained, regarding the material default of
such tenant under the terms of its lease or early termination by either the
tenant or the Borrower of such lease, the bankruptcy of such tenant or its
direct or indirect parent, the loss of a license or permit relating to the
Mortgaged Property or other material adverse tenant activity; (vi) any
amendment, modification or waiver of a material provision of a Mortgage Loan of
which the Master Servicer has knowledge; and (vii) any event of which the Master
Servicer has actual knowledge (other than an event covered by clause (i)) which
would result in the release of any part of the Mortgaged Property; provided,
however, that in the event that the Master Servicer after consulting with the
Depositor and the Special Servicer determines in its good faith judgment that
any of the preceding items will not materially affect the interests of the
Certificateholders, the Master Servicer shall omit such item from the reporting
obligation described above.
With respect to any Specially Serviced Mortgage Loan or any REO Property,
the Special Servicer shall report to the Master Servicer any of the foregoing
events promptly upon the Special Servicer having knowledge of such event. In
addition, in connection with their servicing of the Mortgage Loans, the Master
Servicer and the Special Servicer shall provide to each other and to the Trustee
written notice of any other known event with respect to a Mortgage Loan or REO
Property that the Master Servicer or the Special Servicer, respectively,
determines would have a material adverse effect on such Mortgage Loan or REO
Property, which notice shall include an explanation as to the reason for such
material adverse effect.
(c) The Master Servicer or Special Servicer, as applicable, shall from time
to time contact the Borrowers regarding the delivery of financial information
required by the Loan Documents commencing at least 15 days prior to the date on
which each Borrower is obligated to provide the Master Servicer or Special
Servicer, as applicable, with quarterly and annual financial statements or
reports so that such statements and reports will be delivered to the Master
Servicer in a timely fashion. The Master Servicer or Special Servicer, as
applicable, will cause such information to be provided to the Trustee in such
format as the Trustee may reasonably request to enable the Trustee to comply
with the Exchange Act reporting requirements specifically set forth in this
Section 3.20. Promptly following the end of each calendar quarter and the end of
each calendar year, the Master Servicer shall prepare a Summary Report in the
form of Exhibit H based on information provided to the Master Servicer by the
Borrowers without modification, interpretation or analysis (except that the
Master Servicer will use its best efforts to isolate management fees and funded
reserves from Borrower reported expenses, if necessary). The Master Servicer
shall deliver a copy of each Summary Report to the Trustee and the Special
Servicer. None of the Master Servicer, the Special Servicer and the Trustee
shall be responsible for the completeness or accuracy of such information
provided by the Borrowers (except that the Master Servicer will use its best
efforts to correct patent errors).
(d) The Master Servicer shall, in accordance with such reasonable rules and
procedures as it may adopt (which may include the requirement that an agreement
that provides that such information shall be used solely for purposes of
evaluating the investment characteristics of the Certificates be executed to the
extent the Master Servicer deems such action to be necessary or appropriate),
also make available any additional information relating to the Mortgage Loans,
the Mortgaged Properties or the Borrowers, for review by the Depositor, the
Rating Agencies, the Certificateholders, the Special Servicer and any other
Persons to whom the Master Servicer believes such disclosure is appropriate, in
each case except to the extent doing so is prohibited by applicable law or by
any related Loan Documents related to a Mortgage Loan. Consistent with the
foregoing, the Master Servicer may, at its discretion, at the request of any of
the Depositor, the Rating Agencies, the Trustee or any Certificateholder, but is
not required to, prepare from information delivered by the Borrowers pursuant to
any of the Loan Documents one or more reports in addition to the reports and
information that the Master Servicer is required to furnish pursuant to this
Agreement and may charge for such service a fee to any Person (other than the
Rating Agencies) requesting a copy of any such additional report. The Master
Servicer may, but is not required to, make information which is otherwise
available to the public available on the Internet.
(e) The Trustee shall deliver a copy of each Summary Report and Annual
Compliance Report to each Rating Agency and, upon request, to each
Certificateholder and Beneficial Owner (provided that each Certificateholder and
Beneficial Owner may only make one request per month and will be required to pay
any expenses incurred by the Trustee in connection with the provision of such
information). The Trustee shall also deliver a copy of each Special Event Report
to each Rating Agency, Certificateholder and, if known, Beneficial Owner within
one Business Day of receipt. The Trustee shall so deliver the foregoing
information and reports and shall file such Summary Report and Annual Compliance
Report annually on Form 10-K and shall file such Special Event Reports on Form
8-K promptly upon the occurrence of the applicable event, in each case unless
the Trust Fund is no longer filing Exchange Act Reports. The Trustee shall also
make available at its offices primarily responsible for administration of the
Trust Fund, during normal business hours, or send to the requesting party at the
expense of each such requesting party (other than the Rating Agencies) for
review by the Depositor, the Rating Agencies, any Certificateholder, any Person
identified to the Trustee by a Certificateholder as a prospective transferee of
a Certificate and any other Persons to whom the Trustee believes such disclosure
is appropriate, the following items: (i) this Agreement, (ii) all Monthly
Distribution Statements, (iii) all Annual Compliance Reports, (iv) all Summary
Reports and (v) all Special Event Reports.
The Master Servicer and the Special Servicer shall, in accordance with such
reasonable rules and procedures as it may adopt (which may include the
requirement that an agreement that provides that such information shall be used
solely for purposes of evaluating the investment characteristics of the
Certificates be executed to the extent the Master Servicer deems such action to
be necessary or appropriate), each make available at its offices during normal
business hours, or send to the requesting party at the expense of each such
requesting party (other than the Rating Agencies) for review by the Depositor,
the Trustee, the Rating Agencies, any Certificateholder, any Person identified
to the Master Servicer or the Special Servicer, as applicable, by a
Certificateholder as a prospective transferee of a Certificate and any other
Persons to whom the Master Servicer or the Special Servicer, as applicable,
believes such disclosure to be appropriate, in each case except to the extent
doing so is prohibited by applicable law or by any related Loan Documents
related to a Mortgage Loan, the following items: (i) all financial statements,
occupancy information, rent rolls and similar information received by the Master
Servicer or the Special Servicer, as applicable, from each Borrower, (ii) the
inspection reports prepared by or on behalf of the Master Servicer or the
Special Servicer, as applicable, in connection with the property inspections
pursuant to Section 3.19, (iii) any and all modifications, waivers and
amendments of the terms of a Mortgage Loan entered into by the Master Servicer
or the Special Servicer, as applicable, and (iv) any and all officer's
certificates and other evidence delivered to the Trustee and the Depositor to
support the Master Servicer's determination that any Advance was, or if made
would be, a Nonrecoverable Advance. The Master Servicer may require that such
party execute a reasonable confidentiality agreement customary in the industry
(and approved by the Depositor) with respect to such information.
Copies of any and all of the foregoing items shall be available from the
Master Servicer or the Special Servicer, as applicable, or the Trustee, as
applicable, upon request at the requesting party's expense.
(f) The Depositor shall designate, and pay the expenses of, a financial
printer or other entity (which may be the Trustee) to prepare the materials
required to be filed pursuant to this Section 3.20 for filing via the EDGAR
system, and the Master Servicer and Special Servicer shall each cooperate fully
with such entity and the Master Servicer and the Special Servicer shall provide
the information required hereunder with respect to the Mortgage Loans, to the
extent made available by the related Borrowers, in a timely manner in order to
allow the Trustee to file such materials at the times required hereunder. In the
event the Trustee does not receive in electronic format Borrower information it
receives in hard copy format within two Business Days after it receives the
information in hard copy, the Trustee shall promptly notify the Depositor by
telephone or by facsimile transmission.
(g) Notwithstanding any other provision of this Section 3.20, at least
three Business Days prior to the date upon which any materials are required to
be filed with the Commission pursuant to the terms hereof, the Trustee shall
provide a copy of such filing, in hard copy form (or such electronic format
acceptable to the Depositor), to the Depositor (with a copy to the Underwriter).
The Depositor shall review such filing and make any necessary corrections to
such filing or direct the Trustee not to make such filing prior to the date such
materials are required to be filed pursuant to the terms hereof.
(h) The Trustee shall indemnify and hold the Depositor harmless against any
loss, liability or expense incurred as the direct result of the Trustee's
negligent failure to file any Exchange Act Report specifically identified in
this Section 3.20 or in writing by the Depositor in the form and at the time
required pursuant to the terms of this Section 3.20; provided that any failure
on the part of the Master Servicer, the Special Servicer or the Depositor to
timely provide the Trustee in the correct form the information required by the
Trustee to file such Exchange Act Reports shall not constitute negligence on the
part of the Trustee. Furthermore, the Trustee shall have no liability with
regards to the accuracy of the information included in such Exchange Act
Reports.
SECTION 3.21. Lock-Box Accounts, Cash Collateral Accounts, Escrow Accounts
and Reserve Accounts.
The Master Servicer shall administer each Lock-Box Account, Cash Collateral
Account, Escrow Account and Reserve Account in accordance with the related
Mortgage or Loan Agreement, Cash Collateral Account Agreement or Lock-Box
Agreement, if any, and administer any letters of credit pursuant to the related
letter of credit agreements and the Loan Documents.
SECTION 3.22. Property Advances.
(a) The Master Servicer (or, to the extent provided in Section 3.22(b), the
Trustee or, to the extent specifically provided for in this Agreement, the
Special Servicer) shall make any Property Advances as and to the extent
otherwise required pursuant to the terms hereof.
Any Property Advance required to be made by the Special Servicer in
accordance with the terms of this Agreement shall, at the Special Servicer's
option, either (i) be paid by the Master Servicer upon the request of the
Special Servicer or (ii) shall be made by the Special Servicer who shall be
reimbursed by the Master Servicer on a monthly basis, and in each case such
payments and reimbursements by the Master Servicer shall be treated for all
purposes hereunder as a Property Advance. The Special Servicer shall submit not
more than one such request in each calendar month unless the request relates to
an extraordinary expense. In the event that the Master Servicer fails to pay or
reimburse the Special Servicer for any Property Advance made by the Special
Servicer the Trustee shall reimburse the Special Servicer for such Property
Advance in the same manner as all other Property Advances.
For purposes of distributions to Certificateholders and compensation to the
Master Servicer, Special Servicer or Trustee, Property Advances shall not be
considered to increase the principal balance of any Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so provide.
(b) The Master Servicer shall notify the Trustee, and the Special Servicer
shall notify the Master Servicer and the Trustee, in writing promptly upon, and
in any event within one Business Day after, becoming aware that it will be
unable to make any Property Advance required to be made pursuant to the terms
hereof, including Master Servicer's reimbursement of a Property Advance made by
the Special Servicer, and in connection therewith, shall set forth in such
notice the amount of such Property Advance, the Person to whom it will be paid,
and the circumstances and purpose of such Property Advance, and shall set forth
therein information and instructions for the payment of such Property Advance,
and, on the date specified in such notice for the payment of such Property
Advance, or, if the date for payment has passed or if no such date is specified,
then within five Business Days following such notice, the Trustee (or with
respect to a Property Advance required to be made by the Special Servicer, the
Master Servicer, and if the Master Servicer so fails, the Trustee), subject to
the provisions of Section 3.22(c), shall pay the amount of such Property Advance
in accordance with such information and instructions.
(c) Notwithstanding anything herein to the contrary, none of the Master
Servicer, the Trustee or the Special Servicer shall be obligated to make a
Property Advance as to any Mortgage Loan or REO Property if the Master Servicer,
the Trustee or the Special Servicer, as applicable, determines that such Advance
will be a Nonrecoverable Advance. The Trustee (or the Master Servicer with
respect to a Property Advance required to be made by the Special Servicer) shall
be entitled to rely, conclusively, on any determination by the Master Servicer
or Special Servicer, as applicable, that a Property Advance, if made, would be a
Nonrecoverable Advance. The Trustee and the Special Servicer, in determining
whether or not a Property Advance previously made is, or a proposed Property
Advance, if made, would be, a Nonrecoverable Advance shall be subject to the
standards applicable to the Master Servicer hereunder.
(d) The Master Servicer, the Special Servicer and/or the Trustee, as
applicable, shall be entitled to the reimbursement of Property Advances made by
any of them to the extent permitted pursuant to Section 3.06(ii) of this
Agreement, together with any related Advance Interest Amount in respect of such
Property Advances, and the Master Servicer and Special Servicer hereby covenant
and agree to promptly seek and effect the reimbursement of such Property
Advances from the related Borrowers to the extent permitted by applicable law
and the related Loan Documents.
SECTION 3.23. Appointment of Special Servicer.
(a) Clarion Partners, LLC is hereby appointed as the initial Special
Servicer to service each of the Mortgage Loans.
(b) Certificateholders representing greater than 50% of the Percentage
Interests of the most subordinate Class of Certificates outstanding at any time
shall be entitled to remove the Special Servicer with or without cause and to
appoint a successor Special Servicer entitled to the same servicing compensation
as its predecessor, provided that each Rating Agency confirms to the Trustee in
writing that such appointment, in and of itself, would not have caused a
downgrade, qualification or withdrawal of the then current ratings assigned to
any Class of Certificates. If there is a Special Servicer Event of Default, the
Special Servicer shall be removed and replaced pursuant to Sections 7.01(c) and
7.02. The Special Servicer may be removed by Certificateholders as aforesaid
with respect to only one or more Mortgage Loans and remain the Special Servicer
with respect to the remainder of the Mortgage Loans; provided that a successor
Special Servicer is appointed, in respect of the Mortgage Loans that the Special
Servicer would no longer be servicing, as provided in this Section 3.23. The
Holders of the most subordinate Class of Certificates then outstanding shall
then appoint a successor Special Servicer in accordance with this Section 3.23.
Notwithstanding the foregoing, if the Special Servicer acquires any Affiliate
Loan, the Special Servicer shall promptly resign as Special Servicer hereunder
with respect to such Mortgage Loan in accordance with Section 6.04 hereof, and
if the Special Servicer fails to promptly resign, the Trustee shall terminate
the Special Servicer with respect to such Mortgage Loan, in accordance with the
provisions set forth in Section 7.01 and Section 7.02.
(c) The appointment of any such successor Special Servicer, shall not
relieve the Master Servicer or the Trustee of their respective obligations to
make Advances as set forth herein; provided, however, the initial Special
Servicer specified in Section 3.23(a) above shall not be liable for any actions
or any inaction of such successor Special Servicer. Any termination fee payable
to the terminated Special Servicer (other than the initial Special Servicer)
shall be paid by the Certificateholders so terminating the Special Servicer and
shall not in any event be an expense of the Trust Fund.
(d) No termination of the Special Servicer and appointment of a successor
Special Servicer shall be effective until the successor Special Servicer has
assumed all of its responsibilities, duties and liabilities hereunder pursuant
to a writing satisfactory to the Trustee and each Rating Agency, as evidenced in
writing and the Trustee has received written confirmation from each Rating
Agency that such appointment would not cause any Rating Agency to qualify,
withdraw or downgrade any of its then current ratings on any Certificates.
(e) Any successor Special Servicer shall be deemed to make the
representations and warranties provided for in Section 2.04(a) mutatis mutandis
as of the date of its succession.
(f) Notwithstanding any of the foregoing provisions, for the purposes of
determining the requisite Percentage Interests pursuant to Section 3.23(b), or
the requisite Voting Rights pursuant to Section 7.01(b) and Section 7.02, any
Certificate owned by a Person that is, or whose Affiliate is, also the lender of
any debt of any Affiliate of the Borrowers shall be deemed not to be outstanding
and the Percentage Interests or Voting Rights represented by such Certificate
shall not be taken into account in making such determination.
(g) Upon any termination pursuant to this Section 3.23, the Special
Servicer shall be entitled to receive a termination fee equal to the applicable
percentage set forth below of the proceeds received by any successor Special
Servicer in respect of (i) any Liquidation Fee received by such successor
Special Servicer in connection with any liquidation proceeding for any Mortgage
Loan or REO Property initiated and advanced by the Special Servicer prior to its
termination, and (ii) any Special Servicing Rehabilitation Fee received by such
successor Special Servicer in connection with any modification that was
initiated and advanced by the Special Servicer prior to its termination. The
balance of such Liquidation Fee or Special Servicing Fee shall be payable to the
successor Special Servicer (subject to Section 6.04(b)). Such termination fees
shall be calculated as of the date of the completion of such liquidation or
modification, as the case may be (regardless of any delay in the receipt of the
applicable proceeds) and shall be payable by such successor Special Servicer
promptly upon its receipt of proceeds in respect of such liquidation or
modification proceedings, as the case may be.
Number of Days Following
Termination of Special Servicer Applicable Percentage
First 30 days 86%
31 to 60 days 71%
61 to 90 days 57%
91 to 120 days 43%
121 to 150 days 29%
SECTION 3.24. Transfer of Servicing Between Master Servicer
and Special Servicer; Record Keeping.
(a) Upon determining that any Mortgage Loan has become a Specially Serviced
Mortgage Loan, the Master Servicer shall immediately give written notice thereof
to the Special Servicer and shall use its best efforts to provide the Special
Servicer with all information, documents (but excluding the original documents
constituting the Mortgage File) 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 duties hereunder with respect thereto without acting through a
sub-servicer, including, without limitation, financial statements, appraisals,
environmental and engineering reports, rent rolls and tenant estoppels. The
Master Servicer shall use its best efforts to comply with the preceding sentence
within five Business Days of the date such Mortgage Loan became a Specially
Serviced Mortgage Loan and in any event shall continue to act as Master Servicer
and administrator of such Mortgage Loan until the Special Servicer has commenced
the servicing of such Mortgage Loan, which shall occur upon the receipt by the
Special Servicer of the information, documents and records referred to in the
preceding sentence. With respect to each Mortgage Loan that becomes a Specially
Serviced Mortgage Loan, the Master Servicer shall instruct the related Borrower
to either (i) to continue to remit all payments in respect of such Mortgage Loan
to the Master Servicer or (ii) to remit all payments in respect of such Mortgage
Loan to the Special Servicer, provided that the payee in respect of such
payments shall remain the Master Servicer. The Special Servicer shall remit to
the Master Servicer any such payments received by it pursuant to the preceding
sentence within one Business Day of receipt. The Master Servicer shall forward
any notices it would otherwise send to the Borrower of a Specially Serviced
Mortgage Loan to the Special Servicer who shall send such notices to the related
Borrower.
Upon determining that no event has occurred and is continuing with respect
to a Mortgage Loan that causes such Mortgage Loan to be a Specially Serviced
Mortgage Loan, the Special Servicer shall immediately give notice thereof to the
Master Servicer and, upon giving such notice, such Mortgage Loan shall cease to
be a Specially Serviced Mortgage Loan in accordance with the first proviso of
the definition of Specially Serviced Mortgage Loans, the Special Servicer's
obligation to service such Mortgage Loan shall terminate and the obligations of
the Master Servicer to service and administer such Mortgage Loan as a Mortgage
Loan that is not a Specially Serviced Mortgage Loan shall resume. In addition,
if the related Borrower has been instructed, pursuant to the preceding
paragraph, to make payments to the Special Servicer, upon such determination,
the Special Servicer shall instruct the related Borrower to remit all payments
in respect of such Mortgage Loan directly to the Master Servicer.
(b) In servicing any Specially Serviced Mortgage Loan, the Special Servicer
shall provide to the Trustee originals of documents included within the
definition of "Mortgage File" for inclusion in the related Mortgage File (to the
extent such documents are in the possession of the Special Servicer) and copies
of any additional related Mortgage Loan information, including correspondence
with the related Borrower, and the Special Servicer shall promptly provide
copies of all of the foregoing to the Master Servicer as well as copies of any
analysis or internal review prepared by or for the benefit of the Special
Servicer.
(c) Not later than the Business Day preceding each date on which the Master
Servicer is required to furnish a report under Section 3.13(a) to the Trustee,
the Special Servicer shall deliver to the Master Servicer a written statement
describing, on a Mortgage Loan by Mortgage Loan basis, (i) the amount of all
payments on account of interest received on each Specially Serviced Mortgage
Loan, the amount of all payments on account of principal, including Principal
Prepayments, on each Specially Serviced Mortgage Loan, the amount of Net
Insurance Proceeds and Net Liquidation Proceeds received with respect to each
Specially Serviced Mortgage Loan, and the amount of net income or net loss, as
determined from management of a trade or business on, the furnishing or
rendering of a non-customary service to the tenants of, or the receipt of any
rental income that does not constitute Rents from Real Property with respect to
the REO Property relating to each applicable Specially Serviced Mortgage Loan,
in each case in accordance with Section 3.17 and (ii) such additional
information relating to the Specially Serviced Mortgage Loans as the Master
Servicer or Trustee reasonably requests to enable it to perform its duties under
this Agreement.
(d) Notwithstanding the provisions of the preceding subsection (c), the
Master Servicer shall maintain ongoing payment records with respect to each of
the Specially Serviced Mortgage Loans and shall provide the Special Servicer
with any information reasonably required by the Special Servicer to perform its
duties under this Agreement. The Special Servicer shall provide the Master
Servicer with any information reasonably required by the Master Servicer to
perform its duties under this Agreement.
SECTION 3.25. Limitations on and Authorizations of the Master Servicer and
Special Servicer with Respect to Specific Mortgage Loans.
(a) With respect to any Mortgage Loan which permits the related Borrower,
with the consent or grant of a waiver by mortgagee, to incur additional
indebtedness or to amend or modify the related Borrower's organizational
documents, then the Master Servicer or the Special Servicer, as the case may be,
may only consent to either such action, or grant a waiver with respect thereto,
if the Master Servicer or the Special Servicer determines that such consent or
waiver is likely to result in a greater recovery on a present value basis
(discounted at the related Mortgage Rate) than would not consenting to such
action and the Master Servicer or the Special Servicer first obtains written
confirmation from each Rating Agency that such consent or grant of a waiver
would not, in and of itself, result in a downgrade, qualification or withdrawal
of any of the then current ratings assigned to the Certificates. Any such
consent or waiver shall also satisfy the criteria set forth in Section 3.09(b),
to the extent applicable. In addition, with respect to any such consent or
waiver granted by the Master Servicer which materially affects the terms of the
related Mortgage Loan, the Master Servicer shall first obtain the consent of the
Special Servicer to such action who may grant or withhold its consent in
accordance with the Servicing Standard and the terms of this Agreement.
(b) The Master Servicer shall receive bills from the Rating Agencies for
monitoring, review and surveillance of the Certificates and the Mortgage Loans
and shall pay such amounts in a timely manner. In the event that Rating Agency
confirmation is required in connection with any exercise of rights by the Master
Servicer or the Special Servicer, as applicable, under any Mortgage Loan, the
Master Servicer or Special Servicer, as the case may be, shall use its
reasonable best efforts to cause the related Borrower to pay any fee required by
the applicable Rating Agency for such confirmation. If the related Borrower does
not pay such fee, and the Mortgage Loan is a Specially Serviced Mortgage Loan,
such fee shall be paid by the Master Servicer or Special Servicer, as the case
may be, as a Property Advance and shall be borne by the Trust Fund. If the
Borrower does not pay such fee, and the Mortgage Loan is not a Specially
Serviced Mortgage Loan, the Depositor shall pay such fee. Notwithstanding the
reimbursement of any such amounts by the Trust Fund, the Master Servicer and the
Special Servicer shall, to the extent consistent with the Servicing Standard,
continue to endeavor to collect any such amounts from the related Borrower.
(c) Prior to taking any enforcement action with respect to a Mortgage Loan
secured in whole or in part by Mortgaged Properties located in a "one-action"
state, the Master Servicer or Special Servicer, as applicable, shall consult
with legal counsel admitted to practice in the relevant jurisdiction, the fees
and expenses of which shall be an expense of the Trust Fund.
(d) With respect to all Mortgage Loans that provide that the holder of the
related Note may apply the monthly payment against principal, interest and any
other sums due in such order as the holder shall determine, the Master Servicer
shall apply such Monthly Payment to interest (other than Deferred Interest or
Default Interest) under the related Mortgage Loan prior to application to
principal or any other sums due.
(e) With respect to each Mortgage Loan, neither the Master Servicer (nor
the Special Servicer (including in its capacity as a Certificateholder, if
applicable), shall take any enforcement action with respect to the payment of
Deferred Interest or principal in excess of the principal component of the
constant Monthly Payment, other than requests for collection, until the Maturity
Date of the related Mortgage Loan; provided, that the Master Servicer or Special
Servicer, as the case may be, may take action to enforce the Trust Fund's right
to apply excess cash flow to principal in accordance with the terms of the Loan
Documents.
(f) The obligations of the Master Servicer and Special Servicer set forth
in this Section 3.25 shall be subject to the operative documents with respect to
the related Mortgage Loan, and the failure or inability of the related Borrower
to comply with the Master Servicer's or the Special Servicer's direction shall
not be deemed to be an Event of Default of the Master Servicer or the Special
Servicer hereunder.
(g) The Master Servicer or the Special Servicer, as applicable, shall be
permitted, in its discretion, to waive all or any accrued Deferred Interest if,
prior to the related Maturity Date, the related Borrower 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 Deferred Interest, provided that the Master Servicer or the Special
Servicer, as applicable, determines (taking into account the value and revenues
of the related Mortgaged Property and the ability of the Borrower to pay the
Mortgage Loan (including such Deferred Interest)) that (1) in the absence of the
waiver of such Deferred Interest, there is a reasonable likelihood that the
Mortgage Loan will not be paid in full on the related Maturity Date and (2) the
waiver of the right to such accrued Deferred Interest is reasonably likely to
produce a larger (and not equivalent) payment in the aggregate to
Certificateholders on a present value basis than a refusal to waive the right to
such Deferred Interest. The Master Servicer shall have no liability to the Trust
Fund, the Certificateholders or any other person so long as such determination
is based on such criteria. In no event shall such waiver of such Deferred
Interest be effective prior to the date of actual prepayment in full (other than
such waived Deferred Interest), and such waiver shall in no event be effective
if such prepayment is not made.
(h) The Master Servicer and the Depositor shall cooperate and send written
notice to each Borrower and the related Manager or Managers and clearing bank or
banks sweeping monies to a Cash Collateral Account that, if applicable, the
Master Servicer has been appointed as the "Designee" or agent of the "Lender"
(or equivalent terminology) under any related Lock-Box Agreement and/or Cash
Collateral Account Agreement.
(i) For any Mortgage Loan with respect to which, under the terms of the
related Loan Documents, the mortgagee may, in its discretion, apply Insurance
Proceeds, condemnation awards or escrowed funds to the prepayment of such loan
prior to the expiration of the related Lock-out Period, the Master Servicer or
Special Servicer, as applicable, may only require such a prepayment if the
Master Servicer or Special Servicer, as applicable, has determined in accordance
with the Servicing Standard that such prepayment is in the best interests of the
Certificateholders.
(j) [reserved]
(k) With respect to each Mortgage Loan, the Master Servicer or the Special
Servicer, as applicable, shall give notice to the related Borrower of any
default or event of default under such Mortgage Loan, including without
limitation any default in the payment of interest or principal, immediately upon
receipt of knowledge thereof, in conformity with the notice provisions of such
Mortgage Loan, whether or not notice is required to be given thereunder.
(l) With respect to each Mortgage Loan, the giving of any consent or
approval to an investment of funds permitted with mortgagee consent or approval
pursuant to the terms of any Loan Document shall be conditioned on such
investments being made in Permitted Investments (as defined herein).
(m) Notwithstanding any other provision herein to the contrary (but subject
to Section 3.25(n)), the Trustee, the Master Servicer and the Special Servicer,
as applicable, shall be subject to the following limitations or authorizations,
as applicable, with respect to the specific Mortgage Loans identified below:
(i) The Trustee, the Master Servicer or the Special Servicer, as
applicable, shall not take any of the following actions unless
(x) it has received prior written confirmation from each Rating
Agency that such action, in and of itself, will not result in the
qualification, downgrade or withdrawal of the then current
ratings assigned by such Rating Agency to any of the Classes of
Certificates or (y) the mortgagee is not given discretion under
the terms of the related Mortgage Loan:
(A) With respect to each Mortgage Loan, the giving of any
consent to the transfer of any interest in a related
Mortgaged Property or of any direct or indirect interest in
the related Borrower;
(B) With respect to each Mortgage Loan, the giving of any
consent to the termination of the related Manager or the
designation of any replacement Manager.
(C) With respect to the Courthouse Plaza I Loan and the
Ramco-Gershenson Pool Loan, the giving of consent to any
future unsecured subordinated debt by the respective related
Borrower from any of their respective Affiliates.
(D) With respect to the West Town Mall Loan, the giving of
consent to any future encumbrances of the related Mortgaged
Property, and the Master Servicer or Special Servicer, as
applicable, shall not let any deemed consent period, as set
forth in the related Loan Documents, lapse.
(E) With respect to the Glenborough Pool Loan, the approval of
any letter of credit as meeting the requirements of the
related Loan Documents.
(ii) With respect to the EQR Apartment Pool Loan, the Master Servicer
or the Special Servicer, as the case may be, shall enforce the
rights of the Trustee, as assignee of the lender, under the
related lost note affidavit, in accordance with the Servicing
Standard.
(iii) Unless expressly provided otherwise in the related Loan
Documents, the "discount rate" used to calculate any yield
maintenance charge with respect to any Mortgage Loan shall be the
Discount Rate.
(iv) With respect to any Mortgage Loan that requires the Borrower to
provide additional collateral upon a decline in the debt service
coverage ratio thereof, or permits the Borrower or Manager to
provide additional collateral in order to avoid a termination of
the Manager as a result of a decline in Debt Service Coverage
Ratio, the Master Servicer shall monitor such debt service
coverage ratio based on the information provided by the Borrower
in accordance with the Loan Documents, and shall enforce such
obligation of the Borrower in accordance with the Servicing
Standard. If such additional collateral is provided in the form
of a letter of credit, or if any Escrow Account or Reserve
Account contains a letter of credit, or if a letter of credit is
provided as additional collateral to avoid termination of a
Manager, the Master Servicer shall require that such letter of
credit be issued by a bank meeting the requirements of the
related Mortgage Loan, and if such requirements are based on
credit rating, shall monitor such rating in accordance with the
Servicing Standard and shall take such actions as are permitted
by the related Mortgage Loan and in accordance with the Servicing
Standard to require replacement of and/or draw down upon, such
letter of credit if the issuer thereof is downgraded below the
required rating level or its rating is qualified or withdrawn.
(v) With respect to any Mortgage Loan that permits the Borrower to
provide additional collateral to avoid termination of the related
Manager upon a decline in debt service coverage ratio, if the
Borrower so elects to provide such collateral, the Master
Servicer shall continue to monitor such debt service coverage
ratio based on the information provided by the Borrower in
accordance with the Loan Documents and enforce the obligation of
the Borrower to provide and increase the amount of such
collateral in accordance with the Servicing Standard.
(vi) With respect to each of the CenterAmerica Pool Loan and the
Charlestowne Mall Loan, the Master Servicer or the Special
Servicer, as applicable, shall enforce all the rights of the
Trustee as assignee of the lender under the related intercreditor
agreement in accordance with the Servicing Standard, including
without limitation its rights with respect to transfers of the
mezzanine loan, foreclosure by the mezzanine lender and
amendments of the mezzanine loan.
(vii) With respect to the Charlestowne Mall Loan, the Master Servicer
or Special Servicer, as the case may be, shall apply any payment
received with respect to the related completion guarantee either
(i) to reduce the outstanding principal balance of such Mortgage
Loan immediately upon receipt of such payment or (ii) to repay
principal on the related Effective Maturity Date.
(viii) With respect to the Wells Fargo Office Tower Loan, the Master
Servicer or Special Servicer, as the case may be, shall not
exercise any option under the related Mortgage Loan Document to
require the related Borrower to pay the entire outstanding
principal balance of such Mortgage Loan on its related Effective
Maturity Date.
(ix) With respect to the CenterAmerica Pool Loan and the Charlestowne
Mall Loan, the Master Servicer or the Special Servicer, as
applicable, shall give notice of any default or event of default
under either such Mortgage Loan to the related mezzanine lender
immediately upon knowing of such default or event of default, in
each case as provided in the related intercreditor agreement, and
in no event later than the giving of notice to the related
Borrower as required by Section 3.25(k). Such notice to the
mezzanine lender shall be given both by certified mail, return
receipt requested, and by a nationally recognized overnight
courier, with acknowledgment of receipt required.
(x) With respect to the Courthouse Plaza I Loan, the Master Servicer
or the Special Servicer, as applicable, shall give notice of any
default or event of default under either such Mortgage Loan to
the related ground lessor immediately upon knowing of such
default or event of default, and in no event later than the
giving of notice to the related Borrower as required by Section
3.25(k). Such notice to the ground lessor shall be given both by
certified mail, return receipt requested, and by a nationally
recognized overnight courier, with acknowledgment of receipt
required.
(xi) With respect to the Wells Fargo Office Tower Loan,
notwithstanding any of the provisions in this Agreement limiting
the authority of the Master Servicer with respect to
modifications of Mortgage Loans, the Master Servicer shall take
such steps as are necessary to enter into a modification of the
Wells Fargo Office Tower Loan for the purpose of changing its
Effective Maturity Date to May 1, 2005.
(n) Notwithstanding any of the other provisions of this Section 3.25, the
Master Servicer shall only take such actions that are required under this
Section 3.25, to the extent that such actions are not expressly inconsistent
with the terms of the related Loan Documents.
(o) To the extent that the Master Servicer is provided with discretion
under the Loan Documents to select insurance or to consent to insurance
coverage, the Master Servicer shall, upon expiration of any policy in place as
of the Cut-Off-Date or to the extent the conditions set forth in the last
paragraph of Section 3.08(a) are no longer satisfied, select or consent to
insurers which satisfy the definition of "Qualified Insurer".
(p) With respect to each Mortgage Loan having an Effective Maturity Date,
if the related Loan Documents give the mortgagee the right to cause the
termination and replacement of the related Manager as a result of the Mortgage
Loan not being prepaid by the Effective Maturity Date or by a certain specified
date after the Effective Maturity Date, the Master Servicer or the Special
Servicer shall not exercise such right solely by virtue of the fact that the
Mortgage Loan has not been prepaid by the Effective Maturity Date or by such
specified date thereafter.
SECTION 3.26. Modifications.
(a) During the term of a Mortgage Loan, the Special Servicer, may,
consistent with the Servicing Standard, agree to modify a Specially Serviced
Mortgage Loan to reduce the amount of principal (but, except as provided in this
Section 3.26, not interest) payable monthly on such Mortgage Loan, provided that
(i) a material default in respect of payment on such Mortgage Loan has occurred
or, in the Special Servicer's reasonable and good faith judgment, a default in
respect of payment on such Mortgage Loan is reasonably foreseeable, and such
modification is reasonably likely to produce a greater recovery to
Certificateholders, on a net present value basis, than would liquidation; (ii)
the Special Servicer terminates the related Manager (unless the Special Servicer
determines that retaining such manager is conducive to maintaining the value of
the related Mortgaged Properties); and (iii) the Special Servicer may only agree
to reductions of monthly payments of principal lasting a period of no more than
twelve consecutive months and, in the aggregate, to no more than three
reductions of twelve months or less each; provided, however, Certificateholders
representing greater than 66-2/3% of all Voting Rights may direct the Special
Servicer in writing not to agree to any such modification. The Special Servicer
shall promptly provide a copy of such proposed modification to the Master
Servicer, the Rating Agencies and the Trustee. The Trustee shall, within two
Business Days, notify, in writing, all of the Certificateholders that have
Voting Rights of such proposed modification. For purposes of determining whether
Certificateholders representing 66-2/3% of all Voting Rights have directed the
Special Servicer not to agree to such modification, each Certificateholder shall
have 15 days following the date of the Trustee's notice to respond to such
notice, and any Certificateholder that has not responded within such time period
shall be deemed to have consented to such modification.
Additionally, the Special Servicer may, consistent with the Servicing
Standard, agree to any modification, waiver or amendment of any term or forgive
or defer interest on and principal of, and/or add collateral for, any Mortgage
Loan with the consent of the Directing Class, subject, however, to each of the
following limitations, conditions and restrictions: (a) a material default in
respect of such Mortgage Loan has occurred or, in the Special Servicer's
reasonable and 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 net present value basis, than would liquidation; (b) no
reduction in the scheduled monthly payment of interest on any Mortgage Loan as a
result of such modification, waiver or amendment may result in an Interest
Shortfall to any Class other than the Directing Class, determined as of the date
of such modification, waiver or amendment; (c) any reduction in the scheduled
monthly payment of principal and/or interest on any Mortgage Loan must require
that all cash flow on all related Mortgaged Properties in excess of amounts
required to operate and maintain such Mortgaged Properties be applied to
payments of principal and interest on such Mortgage Loan; (d) the Special
Servicer may only agree to reductions of principal and/or interest lasting a
period of no more than twelve consecutive months and, in the aggregate, to no
more than three periods of twelve months or less each; (e) the Special Servicer
may not reduce any Prepayment Premium or Lock-out Period; (f) the Special
Servicer may not at any time forgive principal of a Mortgage Loan to the extent
that the amount forgiven, together with all amounts of principal previously
forgiven pursuant to this paragraph would be in excess of (i) the Certificate
Principal Amount of the Directing Class less the sum of (ii) the aggregate
amount of Appraisal Reduction Amounts then outstanding and (iii) the aggregate
amount of Interest Shortfalls then outstanding (other than with respect to the
Directing Class with respect to Interest Shortfalls); (g) the Special Servicer
shall not permit any Borrower to add any real property collateral unless the
Special Servicer (i) has first determined in accordance with the Servicing
Standard, based upon an environmental assessment prepared by an Independent
Person who regularly conducts environmental assessments, at the expense of the
Borrower, that such additional real property 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
(ii) has received confirmation from each Rating Agency that such action will not
result in the downgrade, qualification or withdrawal of the ratings of the
Certificates; and (h) no Mortgage Loan may be extended past the date occurring
two years immediately prior to the Rated Final Distribution Date.
Notwithstanding the foregoing, the Trustee shall promptly upon request provide
the Special Servicer with such information as is in its possession and as is
reasonably necessary to enable the Special Servicer to make the determinations
required by clauses (b) and (f) above. If the Certificateholders representing
100% of the Percentage Interests of the second most subordinate Class of
Certificates then outstanding consent to such modification, waiver or amendment,
the Directing Class for purposes of the determinations made in clauses (b) and
(f) shall include the second most subordinate Class of Certificates and the
amount by which principal can be reduced shall not be in excess of 80% of the
aggregate principal balance of both such Classes less the items specified in
clause (f)(ii) and (f)(iii). A modification pursuant to this paragraph is not
subject to the veto of Certificateholders set forth in the preceding paragraph
of this Section. For the purposes of determining the Percentage Interest of the
Directing Class, the Certificates held by any Certificateholder that holds, or
whose Affiliate is, also the lender of any debt of any Affiliate of the
Borrowers that is related to the Mortgage Loan that is the subject of such
consent, shall not be taken into consideration.
(b) Notwithstanding Section 3.26(a), the Master Servicer or the Special
Servicer, as applicable, shall be permitted to modify, waive or amend any term
of a Mortgage Loan that is not in default or as to which default is not
reasonably foreseeable, but only if such modification, waiver or amendment (a)
would not be "significant" as such term is defined in Treasury Regulations
Section 1.860G-2(b)(3), as determined by the Master Servicer or Special Servicer
(and the Master Servicer or Special Servicer may rely on an Opinion of Counsel
in making such determination); provided, however, that the modification set
forth in Section 3.25(m)(xi) shall not be considered "significant" as such term
is defined in Treasury Regulations Section 1.860G-2(b)(3), (b) would be in
accordance with the Servicing Standard and (c) would not adversely affect in any
material respect the interest of any Certificateholder not consenting thereto.
The consent thereto of the majority of Percentage Interests of each Class of
Certificates affected thereby or written confirmation from each Rating Agency
that such modification, waiver or amendment will not result in a qualification,
withdrawal or downgrading of the then current ratings assigned to the
Certificates shall not be required but shall be conclusive evidence, which may
be relied upon by the Master Servicer or the Special Servicer, as applicable,
that such modification, waiver or amendment would not adversely affect in any
material respect the interest of any Certificateholder not consenting thereto.
Prior to entering into any material modification, waiver or amendment
pursuant to this Section 3.26(b), the Master Servicer shall first provide to the
Special Servicer a copy of its recommendation and the materials upon which such
recommendation is based and, subject to the requirements of the previous
paragraph, shall not take such action unless it has received the written consent
of the Special Servicer, which consent shall be granted or denied by the Special
Servicer within five (5) Business Days (or, upon request of the Special
Servicer, such reasonably extended period) after the Special Servicer's receipt
of all information reasonably requested by the Special Servicer with respect to
such consent request. The Special Servicer's consent shall be given or withheld
in accordance with the Servicing Standard.
(c) The Master Servicer or Special Servicer, as applicable, shall provide
copies of any modifications, waivers or amendments pursuant to this Section 3.26
to each Rating Agency and to the Depositor.
<PAGE>
ARTICLE IV
DISTRIBUTIONS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.
(a) On each Master Servicer Remittance Date, to the extent of Available
Funds, amounts held in the Collection Account shall be withdrawn by the Master
Servicer and remitted to the Trustee for deposit in the Lower-Tier Distribution
Account. On each Distribution Date, the amount that has been so transferred to
the Lower-Tier Distribution Account from the Collection Account shall be
distributed by the Trustee on the Lower-Tier Regular Interests to the Upper-Tier
REMIC in accordance with the provisions set out below. Thereafter, such amounts
shall be considered to be held in the Upper-Tier Distribution Account until
distributed to the Certificateholders.
(i) Principal amounts, rates of interest and timing of payments of
principal and interest on each Class of Lower-Tier Regular
Interest will be identical to such amounts, rates and timing on
the corresponding Class of Related Certificates, except that,
solely for this purpose, all calculations of interest with
respect to the Related Lower-Tier Regular Interests shall be made
as though the Class A-1, Class A-2, Class A-3, Class B, Class C,
Class D, Class E, Class F, Class G, Class H and Class J
Certificate Pass-Through Rates were equal to the WAC Rate and as
though the Class X Notional Amount were zero at all times, such
that the rates of interest and timing of interest payments on
each Related Lower-Tier Regular Interest represent the aggregate
of the corresponding amounts on each Class of Related
Certificates and its related Component of the Class X
Certificates. The Certificate Principal Amount of each Class of
Lower-Tier Regular Interests shall at all times be equal to the
Certificate Principal Amount of its Related Class of
Certificates, and the interest rate of each Class of Lower-Tier
Regular Interests shall be the WAC Rate.
(ii) Any Prepayment Premium that is to be paid to a Class of Regular
Certificates, other than the Class X Certificates, shall be paid
to the Related Lower-Tier Regular Interest, and the balance of
any such Prepayment Premium, so long as any one or more of the
Class LA-1, Class LA-2, Class LA-3, Class LB, Class LC, Class LD,
Class LE, Class LF, Class LG, Class LH or Class LJ Interests
remain outstanding, shall be paid to such Lower-Tier Regular
Interests, pro rata, in proportion to the Interest Distribution
Amount for the Related Certificates for such Distribution Date.
(iii) Realized Losses and other amounts specified in Section 4.01(f)
shall be allocated to, and shall reduce the Certificate Principal
Amount of, each Class of Lower-Tier Regular Interests without
distribution on any Distribution Date, to the extent that the
Certificate Principal Amount of such Class exceeds the
Certificate Principal Amount of the corresponding Class of
Related Certificates because of Realized Losses and other amounts
specified in Section 4.01(f) allocated to such Related
Certificates. Amounts recovered in respect of any amounts
previously written off as Realized Losses and other amounts
specified in Section 4.01(f) will be distributed on the Related
Lower-Tier Regular Interests, to the extent that amounts
recovered in respect of any amounts previously written off as
Realized Losses and other amounts specified in Section 4.01(f)
are distributed on the corresponding Related Certificates plus
interest thereon to the extent paid to the respective Related
Certificates.
(iv) On each Distribution Date, any amounts remaining in the
Lower-Tier Distribution Account after the distributions set forth
above in this Section 4.01(a)(i)-(iii) shall be distributed to
the Class LR Certificates.
(b) On each Distribution Date prior to the Cross-over Date, Holders of each
Class of Certificates (other than the Class Q and Class LR Certificates) shall
receive distributions from amounts on deposit in the Upper-Tier Distribution
Account in respect of interest and principal, to the extent of Available Funds,
in the amounts and in the order of priority set forth below:
First, pro rata, in respect of interest, to the Class A-1, Class A-2, Class
A-3 and Class X Certificates, up to an aggregate amount equal to, and pro rata
as among such Classes in accordance with, the Interest Distribution Amounts of
such Classes;
Second, to the Class A Certificates, in reduction of their respective
Certificate Principal Amounts in the following order: first, to the Class A-1
Certificates, second, to the Class A-2 Certificates and third, to the Class A-3
Certificates, in each case up to an amount equal to the lesser of (i) the
Certificate Principal Amount thereof and (ii) the Principal Distribution Amount
for such Distribution Date;
Third, to the Class B Certificates, in respect of interest, up to an amount
equal to the Interest Distribution Amount of such Class;
Fourth, to the Class B Certificates, in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Fifth, to the Class B Certificates, an amount equal to the aggregate of
unreimbursed Realized Losses previously allocated to such Class, plus interest
thereon at the Pass-Through Rate for such Class compounded monthly from the date
the related Realized Loss was allocated to such Class;
Sixth, to the Class C Certificates, in respect of interest, up to an amount
equal to the Interest Distribution Amount of such Class;
Seventh, to the Class C Certificates, in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Eighth, to the Class C Certificates, an amount equal to the aggregate of
unreimbursed Realized Losses previously allocated to such Class, plus interest
thereon at the Pass-Through Rate for such Class compounded monthly from the date
the related Realized Loss was allocated to such Class;
Ninth, to the Class D Certificates, in respect of interest, up to an amount
equal to the Interest Distribution Amount of such Class;
Tenth, to the Class D Certificates, in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Eleventh, to the Class D Certificates, an amount equal to the aggregate of
unreimbursed Realized Losses previously allocated to such Class, plus interest
thereon at the Pass-Through Rate for such Class compounded monthly from the date
the related Realized Loss was allocated to such Class;
Twelfth, to the Class E Certificates, in respect of interest, up to an
amount equal to the Interest Distribution Amount of such Class;
Thirteenth, to the Class E Certificates, in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Fourteenth, to the Class E Certificates, an amount equal to the aggregate
of unreimbursed Realized Losses previously allocated to such Class, plus
interest thereon at the Pass-Through Rate for such Class compounded monthly from
the date the related Realized Loss was allocated to such Class;
Fifteenth, to the Class F Certificates, in respect of interest, up to an
amount equal to the Interest Distribution Amount of such Class;
Sixteenth, to the Class F Certificates, in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Seventeenth, to the Class F Certificates, an amount equal to the aggregate
of unreimbursed Realized Losses previously allocated to such Class, plus
interest thereon at the Pass-Through Rate for such Class compounded monthly from
the date the related Realized Loss was allocated to such Class;
Eighteenth, to the Class G Certificates in respect of interest, up to an
amount equal to the Interest Distribution Amount of such Class;
Nineteenth, to the Class G Certificates, in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Twentieth, to the Class G Certificates, an amount equal to the aggregate of
unreimbursed Realized Losses previously allocated to such Class, plus interest
thereon at the Pass-Through Rate for such Class compounded monthly from the date
the related Realized Loss was allocated to such Class;
Twenty-first, to the Class H Certificates, in respect of interest, up to an
amount equal to the Interest Distribution Amount of such Class;
Twenty-second, to the Class H Certificates in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Twenty-third, to the Class H Certificates, an amount equal to the aggregate
of unreimbursed Realized Losses previously allocated to such Class, plus
interest thereon at the Pass-Through Rate for such Class compounded monthly from
the date the related Realized Loss was allocated to such Class; and
Twenty-fourth, to the Class J Certificates, in respect of interest, up to
an amount equal to the aggregate Interest Distribution Amount of such Class;
Twenty-fifth, to the Class J Certificates in reduction of the Certificate
Principal Amount thereof, up to an amount equal to the Principal Distribution
Amount less the portion of the Principal Distribution Amount distributed
pursuant to all prior clauses, until the Certificate Principal Amount thereof is
reduced to zero;
Twenty-sixth, to the Class J Certificates, an amount equal to the aggregate
of unreimbursed Realized Losses previously allocated to such Class, plus
interest thereon at the Pass-Through Rate for such Class compounded monthly from
the date the related Realized Loss was allocated to such Class; and
Twenty-seventh, to the Class R Certificates, any amounts remaining in the
Upper-Tier Distribution Account.
On each Distribution Date occurring on and after the Cross-over Date,
regardless of the allocation of principal payments described in priority Second
above, an amount equal to the aggregate of the Principal Distribution Amounts
will be distributed, first, to the Class A-1, Class A-2 and Class A-3
Certificates, pro rata, based on their respective Certificate Principal Amounts,
in reduction of their respective Certificate Principal Amounts, until the
Certificate Principal Amount of each such Class is reduced to zero, and, second,
to the Class A-1, Class A-2 and Class A-3 Certificates for unreimbursed amounts
of Realized Losses previously allocated to such Classes, pro rata, in accordance
with the amount of such unreimbursed Realized Losses so allocated, plus interest
thereon at the Pass-Through Rate for such Class compounded monthly from the date
the Realized Loss was allocated to such Class.
All references to "pro rata" in the preceding clauses with respect to
interest and Interest Shortfalls shall mean pro rata based on the amount
distributable pursuant to such clauses, with respect to distributions of
principal other than in reimbursement of Realized Losses shall mean pro rata
based on Certificate Principal Amount, and with respect to distributions in
reimbursement of Realized Losses shall mean pro rata based on the amount of
unreimbursed Realized Losses previously allocated to the applicable Classes.
(c) On any Distribution Date, Prepayment Premiums collected during the
related Collection Period shall be distributed to the Holders of the Classes of
Certificates as follows:
(i) If any Class A Certificate remains outstanding on such
Distribution Date, to Holders of the Classes of Principal Balance
Certificates entitled to distributions of principal on such
Distribution Date in an aggregate amount (allocable among such
Classes if more than one such Class remains outstanding, as
described below) equal, with respect to the applicable Prepayment
Premium, to the product of (a) the amount of such Prepayment
Premium, multiplied by (b) a fraction, expressed as a percentage,
the numerator of which is equal to the excess, if any, of the
then current Pass-Through Rate applicable to the most senior of
such Classes of Principal Balance Certificates (or, in the case
of two or more Classes of Class A Certificates remaining
outstanding, the one with the earliest payment priority), over
the relevant Discount Rate, and the denominator of which is equal
to the excess, if any, of the Mortgage Rate for the prepaid
Mortgage Loan over the relevant Discount Rate. If there is more
than one Class of Principal Balance Certificates entitled to
distributions of principal on such Distribution Date, the
aggregate amount described in the preceding sentence shall be
allocated among such Classes on a pro rata basis, in accordance
with the relative amounts of such distributions of principal. Any
portion of such Prepayment Premium that is not required to be so
distributed to the Holders of such Principal Balance Certificates
shall be distributed to the Class X Certificates; and
(ii) If no Class A Certificate remains outstanding on such
Distribution Date, to Holders of the Class X Certificates, an
amount equal to, with respect to the applicable Prepayment
Premium, the product of such Prepayment Premium, multiplied by a
fraction, the numerator of which is equal to the sum of the
Servicing Fee Rate and the Component Pass-Through Rate related to
the Class of Certificates with the earliest Class designation
which has a Class Prepayment Percentage greater than zero, and
the denominator of which is the greater of (x) the excess, if
any, of the Mortgage Rate of the Mortgage Loan that prepaid over
the relevant Discount Rate, and (y) the sum of such Component
Pass-Through Rate and the Servicing Fee Rate. Any portion of such
Prepayment Premium that is not required to be so distributed to
the Holders of the Class X Certificates shall be distributed to
the Holders of the Class B, Class C, Class D, Class E and Class F
Certificates in an amount with respect to each such Class equal
to the product of (a) the Class Prepayment Percentage with
respect to the related Class of Certificates for such
Distribution Date and (b) the remaining portion of such
Prepayment Premium.
(d) On each Distribution Date the Trustee shall withdraw the amount of any
Net Default Interest received in the related Collection Period from the Class Q
Distribution Account and shall distribute such funds to the holders of the Class
Q Certificates.
(e) On each Distribution Date, any Deferred Interest received during the
related Collection Period with respect to any Mortgage Loan shall be distributed
to Holders of the Class B, Class C, Class D, Class E, Class F, Class G, Class H
and Class J Certificates in an amount, with respect to each such Class, equal to
the product of (x) the related Deferred Interest Distribution Percentage and (y)
the aggregate amount of any such Deferred Interest.
(f) The Certificate Principal Amount of each Class of Principal Balance
Certificates entitled to distributions of principal will be reduced without
distribution on any Distribution Date, as a write-off, to the extent of any
Realized Loss allocated to such Class on such Distribution Date. Any such
write-offs will be applied to such Classes of Principal Balance Certificates in
the following order, until each is reduced to zero; first, to the Class J
Certificates; second, to the Class H Certificates; third, to the Class G
Certificates, fourth, to the Class F Certificates; fifth, to the Class E
Certificates; sixth; to the Class D Certificates; seventh, to the Class C
Certificates; eighth, to the Class B Certificates; and, finally, pro rata to the
Class A-1, Class A-2 and Class A-3 Certificates based on their respective
Certificate Principal Amounts.
Shortfalls in Available Funds resulting from additional servicing
compensation other than the Servicing Fee, interest on Advances not covered by
Default Interest, Excess Prepayment Interest Shortfalls, Additional Trust Fund
Expenses, a reduction of the interest rate of a Mortgage Loan by a bankruptcy
court pursuant to a plan of reorganization or pursuant to any of its equitable
powers or other unanticipated or default-related expenses will be allocated to
each Class of Certificates in the same manner as Realized Losses.
(g) All amounts distributable, or reductions allocable on account of
Realized Losses, to a Class of Certificates pursuant to this Section 4.01 on
each Distribution Date shall be allocated pro rata among the outstanding
Certificates in each such Class based on their respective Percentage Interests.
Such distributions shall be made on each Distribution Date other than the
Termination Date to each Certificateholder of record on the related Record Date
(a) by wire transfer of immediately available funds to the account of such
Certificateholder at a bank or other entity located in the United States and
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date, or otherwise (b) by check mailed to such Certificateholder.
The final distribution on each Certificate shall be made in like manner, but
only upon presentment and surrender of such Certificate at the office of the
Trustee or its agent (which may be the Paying Agent or the Certificate Registrar
acting as such agent) that is specified in the notice to Certificateholders of
such final distribution.
(h) Except as otherwise provided in Section 9.01 with respect to an
Anticipated Termination Date, the Trustee shall, no later than the fifteenth day
of the month in the month preceding the month in which the final distribution
with respect to any Class of Certificates is expected to be made, mail to each
Holder of such Class of Certificates, on such date a notice to the effect that:
(A) the Trustee reasonably expects based upon information
previously provided to it 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 Trustee therein
specified, and
(B) if such final distribution is made on such Distribution
Date, no interest shall accrue on such Certificate, or on
the Related Lower-Tier Regular Interests from and after such
Distribution Date;
provided, however, that the Class Q, Class R and Class LR Certificates shall
remain outstanding until there is no other Class of Certificates outstanding.
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 in trust
for the benefit of the appropriate non-tendering Holder or Holders. If any
Certificates as to which notice has been given pursuant to this Section 4.01(h)
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 to receive the final distribution with respect thereto. If within
one year after the second notice not all of such Certificates shall have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining non-tendering Certificateholders
concerning surrender of their Certificates. The costs and expenses of holding
such funds in trust and of contacting such Certificateholders shall be paid out
of such funds. If within two years after the second notice any such Certificates
shall not have been surrendered for cancellation, the Paying Agent shall pay to
the Trustee all amounts distributable to the Holders thereof, and the Trustee
shall thereafter hold such amounts for the benefit of such Holders until the
earlier of (i) its termination as Trustee hereunder and the transfer of such
amounts to a successor Trustee and (ii) the termination of the Trust Fund and
distribution of such amounts to the Class R Certificateholders. No interest
shall accrue or be payable to any Certificateholder on any amount held in trust
hereunder or by the Trustee as a result of such Certificateholder's failure to
surrender its Certificate(s) for final payment thereof in accordance with this
Section 4.01(h). Any funds not distributed on such Distribution Date shall be
set aside and held uninvested in trust for the benefit of Certificateholders not
presenting and surrendering their Certificates in the aforesaid manner.
(i) The Certificate Principal Amounts of the Class J, Class H, Class G,
Class F, Class E, Class D, Class C and Class B Certificates will be notionally
reduced on any Distribution Date for purposes of determining the Voting Rights
of each Class of Certificates to the extent of any Appraisal Reduction Amounts
allocated to such Class with respect to such Distribution Date. To the extent
that the aggregate of the Appraisal Reduction Amounts for any Distribution Date
do exceed such Certificate Principal Amount, such excess will be applied,
subject to any reversal described below, to notionally reduce the Certificate
Principal Amounts of the next most subordinate Class of Certificates on the next
Distribution Date. Any such reductions will be applied in the following order of
priority: first, to the Class J Certificates; second, to the Class H
Certificates; third, to the Class G Certificates; fourth, to the Class F
Certificates; fifth, to the Class E Certificates; sixth, to the Class D
Certificates; seventh, to the Class C Certificates; and finally to the Class B
Certificates (provided in each case that no Certificate Balance in respect of
any such Class may be notionally reduced below zero).
SECTION 4.02. Statements to Certificateholders; Available Information;
Information Furnished to Financial Market Publisher.
(a) On each Distribution Date, the Trustee shall, based on information
provided by the Master Servicer or provided by the Special Servicer to the
Master Servicer (with respect to a Specially Serviced Mortgage Loan, an REO
Property or the servicing responsibilities of the Special Servicer set forth
herein including the Special Servicer's obligation to make Advances) and subject
to receipt thereof, prepare and make available to each Holder of a Certificate,
with copies to the Depositor, the Paying Agent, the Master Servicer, the Special
Servicer, the Rating Agencies and up to three market reporting services
designated by the Depositor, a statement as to such distribution (a "Monthly
Distribution Statement") setting forth the information set forth on Exhibit I
hereto, and including among other things, for each Class, as applicable:
(i) the Principal Distribution Amount and the amount of
Available Funds allocable to principal included therein;
(ii) The Interest Distribution Amount distributable on such Class
and the amount of Available Funds allocable thereto,
together with any Interest Shortfall allocable to such
Class;
(iii) The amount of any P&I Advances by the Master Servicer or the
Trustee included in the amounts distributed to
Certificateholders not reimbursed since the previous
Distribution Date;
(iv) The initial Certificate Principal Balance or initial
Notional Amount, as applicable, of each Class, and the
Certificate Principal Amount or Notional Amount, as
applicable, of each Class after giving effect to the
distribution of amounts in respect of the Principal
Distribution Amount on such Distribution Date;
(v) Realized Losses (for such month and cumulative basis and on
a Mortgage Loan by Mortgage Loan basis) and other shortfalls
attributable to amounts specified in Section 4.01(f) and
their allocation to the Certificate Principal Amount of any
Class of Certificates;
(vi) The Stated Principal Balance of the Mortgage Loans as of the
Due Date immediately prior to such Distribution Date;
(vii) The number and aggregate principal balance of Mortgage Loans
(and the identity of each related Borrower) (A) delinquent
one month, (B) delinquent two months, (C) delinquent three
or more months, (D) as to which foreclosure proceedings have
been commenced and (E) that otherwise constitute Specially
Serviced Mortgage Loans, and, with respect to each Specially
Serviced Mortgage Loan, the amount of Property Advances made
during the related Collection Period, the amount of the P&I
Advance made with respect to such Distribution Date, the
aggregate amount of Property Advances theretofore made that
remain unreimbursed and the aggregate amount of P&I Advances
theretofore made that remain unreimbursed;
(viii) With respect to any Mortgage Loan that became an REO
Property during the preceding calendar month, the principal
balance and appraised value (based on an Updated Appraisal,
if required under Section 3.10(a)) of such Mortgage Loan as
of the date it became an REO Mortgage Loan;
(ix) (A) For any REO Property sold during the related Collection
Period, the date on which the Special Servicer determined
that a Final Recovery Determination was made and the amount
of the proceeds of such sale deposited into the Collection
Account, (B) the aggregate amount of other revenues
collected by the Special Servicer with respect to each REO
Property during the related Collection Period and credited
to the Collection Account, in each case identifying such REO
Property by name and (C) the appraised value as determined
by the most recent Updated Appraisal (or annual letter
update thereof) of any REO Property, if required under
Section 3.10(a);
(x) The amount of the Servicing Fee, Trustee Fee and Special
Servicing Compensation paid with respect to such
Distribution Date;
(xi) (A) The amount of Prepayment Premiums, if any, received
during the related Collection Period, (B) the amount of
Default Interest received during the related Collection
Period and the Net Default Interest for such Distribution
Date and (C) the amount of Deferred Interest, if any,
received during the related Collection Period;
(xii) The outstanding principal balance and Repurchase Price of
any Mortgage Loan purchased or repurchased pursuant to
Sections 2.03(c), 3.18 or 9.01(c);
(xiii) The amount of Prepayment Interest Shortfalls with respect to
such Distribution Date;
(xiv) The CUSIP number for such Class of Certificates, if any;
(xv) The amount of negative amortization on the Mortgage Loans,
created by any modification;
(xvi) The Appraisal Reduction Amounts with respect to such
Distribution Date;
(xvii) A reference to any Special Event Report furnished to the
Trustee during the preceding calendar month, including
without limitation, any such report relating to anchor
tenants;
(xviii) Account reconciliations with respect to the immediately
preceding Distribution Date with respect to the Collection
Account (giving effect to P&I Advances, Property Advances,
Servicing Fees, Trustee Fees, additional servicing
compensation, Prepayment Premiums, Default Interest, Net
Default Interest, and Deferred Interest); and
(xix) other information reasonably requested by the Depositor.
In the case of information furnished pursuant to subclauses (i), (ii),
(iv), (v), and (xi) above, the amounts shall be expressed as a dollar amount in
the aggregate for all Certificates of each applicable Class and for each Class
of Certificates with a denomination of $1,000 initial Certificate Principal
Amount or Notional Amount.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a Certificate (except for a Class R or Class LR Certificate) a
statement containing the information set forth in subclauses (i) and (ii) above,
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Trustee shall be
deemed to have been satisfied to the extent that it provided substantially
comparable information pursuant to any requirements of the Code as from time to
time in force.
On each Distribution Date, the Trustee shall forward to each Holder of a
Class R or Class LR Certificate a copy of the reports forwarded to the other
Certificateholders on such Distribution Date and a statement setting forth the
amounts, if any, actually distributed with respect to the Class R or Class LR
Certificates on such Distribution Date. Such obligation of the Trustee shall be
deemed to have been satisfied to the extent that it provided substantially
comparable information pursuant to any requirements of the Code as from time to
time in force.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a Class R or Class LR Certificate a statement containing the
information provided pursuant to the previous paragraph aggregated for such
calendar year or applicable portion thereof during which such Person was a
Certificateholder. Such obligation of the Trustee shall be deemed to have been
satisfied to the extent that it provided substantially comparable information
pursuant to any requirements of the Code as from time to time in force.
(b) On or within two Business Days following each Distribution Date, the
Trustee shall make available to the Financial Market Publisher and the
Underwriter, using the format and media mutually agreed upon by the Trustee, the
Financial Market Publisher and the Underwriter, the following information
regarding each Mortgage Loan and any other information reasonably requested by
the Underwriter and available to the Trustee:
(i) the Loan Number;
(ii) each related Mortgage Rate; and
(iii) the principal balance as of such Distribution Date.
The Trustee will make available the Monthly Distribution Statement and
certain other information through its Corporate Trust home page on the world
wide web and/or by facsimile through its Street Fax automated fax-back system.
The web page is located at "corporatetrust.statestreet.com". CMBS information is
available by clicking the "Investor Information & Reporting" button, and
selecting the appropriate transaction. Interested parties can register for
Street Fax by calling (617) 664-5600 and requesting an account application by
following the instructions provided by the system. Upon request by any
Certificateholder, the Trustee shall mail the Monthly Distribution Statement to
such Certificateholder. The Trustee shall only be obligated to deliver the
statements, reports and information contemplated by Section 4.02(a) and 4.02(b)
to the extent it receives the necessary underlying information from the Master
Servicer or the Special Servicer and shall not be liable for any failure to
deliver any thereof on the prescribed due dates, to the extent caused by failure
to receive timely such underlying information and, if the Master Servicer is not
the Special Servicer, the Master Servicer shall not be liable for any failure of
the Special Servicer to provide such underlying information. Nothing herein
shall obligate the Trustee, the Master Servicer or the Special Servicer to
violate any applicable law or provision of any Loan Document prohibiting
disclosure of information with respect to any Borrower and the failure of the
Trustee, the Master Servicer or the Special Servicer to disseminate information
for such reason shall not be a breach hereof.
SECTION 4.03. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the Paying Agent
shall comply with all federal withholding requirements with respect to payments
to Certificateholders of interest or original issue discount that the Paying
Agent reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for any such withholding. The Paying
Agent agrees that it will not withhold with respect to payments of interest or
original issue discount in the case of a Certificateholder that is a Non-U.S.
Person that has furnished or caused to be furnished (i) an effective Form W-8 or
Form W-9 or an acceptable substitute form or a successor form and who is not a
"10-percent shareholder" within the meaning of Code Section 871(h)(3)(B) or a
"controlled foreign corporation" described in Code Section 881(c)(3)(C) with
respect to the Trust Fund or the Depositor, or (ii) an effective Form 4224 or an
acceptable substitute form or a successor form. In the event the Paying Agent or
its agent withholds any amount from interest or original issue discount payments
or advances thereof to any Certificateholder pursuant to federal withholding
requirements, the Paying Agent shall indicate the amount withheld to such
Certificateholder. Any amount so withheld shall be treated as having been
distributed to such Certificateholder for all purposes of this Agreement.
SECTION 4.04. REMIC Compliance.
(a) The parties intend that each of the Upper-Tier REMIC and the Lower-Tier
REMIC shall constitute, and that the affairs of each of the Upper-Tier REMIC and
the Lower-Tier REMIC shall be conducted so as to qualify it as, a "real estate
mortgage investment conduit" as defined in, and in accordance with, the REMIC
Provisions, and the provisions hereof shall be interpreted consistently with
this intention. In furtherance of such intention, the Trustee shall, to the
extent permitted by applicable law, act as agent, and is hereby appointed to act
as agent, of each of the Upper-Tier REMIC and the Lower-Tier REMIC and shall on
behalf of each of the Upper-Tier REMIC and the Lower-Tier REMIC: (i) prepare,
sign and file, or cause to be prepared and filed, all required Tax Returns for
each of the Upper-Tier REMIC and the Lower-Tier REMIC, using a calendar year as
the taxable year for each of the Upper-Tier REMIC and the Lower-Tier REMIC when
and as required by the REMIC Provisions and other applicable federal tax laws or
Applicable State and Local Tax Laws; (ii) make an election, on behalf of each of
the Upper-Tier REMIC and the Lower-Tier REMIC, to be treated as a REMIC on Form
1066 for its first taxable year, in accordance with the REMIC Provisions; (iii)
prepare and forward, or cause to be prepared and forwarded, to the
Certificateholders and the Internal Revenue Service and applicable state and
local tax authorities all information reports as and when required to be
provided to them in accordance with the REMIC Provisions of the Code and Section
4.07; (iv) if the filing or distribution of any documents of an administrative
nature not addressed in clauses (i) through (iii) of this Section 4.04(a) is
then required by the REMIC Provisions in order to maintain the status of the
Upper-Tier REMIC or the Lower-Tier REMIC as a REMIC or is otherwise required by
the Code, prepare, sign and file or distribute, or cause to be prepared and
signed and filed or distributed, such documents with or to such Persons when and
as required by the REMIC Provisions or the Code or comparable provisions of
Applicable State and Local Tax Laws; (v) within thirty days of the Closing Date,
furnish or cause to be furnished to the Internal Revenue Service, on Form 8811
or as otherwise may be required by the Code, the name, title and address of the
Person that the holders of the Certificates may contact for tax information
relating thereto (and the Trustee shall act as the representative of each of the
Upper-Tier REMIC and the Lower-Tier REMIC for this purpose), together with such
additional information as may be required by such Form, and shall update such
information at the time or times and in the manner required by the Code (and the
Depositor agrees within 10 Business Days of the Closing Date to provide any
information reasonably requested by the Trustee and necessary to make such
filing); and (vi) maintain such records relating to each of the Upper-Tier REMIC
and the Lower-Tier REMIC as may be necessary to prepare the foregoing returns,
schedules, statements or information, such records, for federal income tax
purposes, to be maintained on a calendar year and on an accrual basis. The
Holder of the largest Percentage Interest in the Class R or Class LR
Certificates shall be the tax matters person of the Upper-Tier REMIC or the
Lower-Tier REMIC, respectively, pursuant to Treasury Regulations Section
1.860F-4(d). If more than one Holder should hold an equal Percentage Interest in
the Class R or Class LR Certificates larger than that held by any other Holder,
the first such Holder to have acquired such Class R or Class LR Certificates
shall be such tax matters person. The Trustee shall act as attorney-in-fact and
agent for the tax matters person of each of the Upper-Tier REMIC and Lower-Tier
REMIC, and each Holder of a Percentage Interest in the Class R or Class LR
Certificates, by acceptance hereof, is deemed to have consented to the Trustee's
appointment in such capacity and agrees to execute any documents required to
give effect thereto, and any fees and expenses incurred by the Trustee in
connection with any audit or administrative or judicial proceeding shall be paid
by the Trust Fund. The Trustee shall not intentionally take any action or
intentionally omit to take any action if, in taking or omitting to take such
action, the Trustee knows that such action or omission (as the case may be)
would cause the termination of the REMIC status of the Upper-Tier REMIC or the
Lower-Tier REMIC or the imposition of tax on the Upper-Tier REMIC or the
Lower-Tier REMIC (other than a tax on income expressly permitted or contemplated
to be received by the terms of this Agreement). Notwithstanding any provision of
this paragraph to the contrary, the Trustee shall not be required to take any
action that the Trustee in good faith believes to be inconsistent with any other
provision of this Agreement, nor shall the Trustee be deemed in violation of
this paragraph if it takes any action expressly required or authorized by any
other provision of this Agreement, and the Trustee shall have no responsibility
or liability with respect to any act or omission of the Depositor or the Master
Servicer which does not enable the Trustee to comply with any of clauses (i)
through (vi) of the fifth preceding sentence or which results in any action
contemplated by clauses (i) through (iii) of the next succeeding sentence. In
this regard the Trustee shall (i) exercise reasonable care not to allow the
occurrence of any "prohibited transactions" within the meaning of Code Section
860F(a), unless the party seeking such action shall have delivered to the
Trustee an Opinion of Counsel (at such party's expense) that such occurrence
would not (A) result in a taxable gain, (B) otherwise subject the Upper-Tier
REMIC or Lower-Tier REMIC to tax (other than a tax at the highest marginal
corporate tax rate on net income from foreclosure property), or (C) cause either
of the Upper-Tier REMIC or Lower-Tier REMIC to fail to qualify as a REMIC; and
(ii) exercise reasonable care not to allow either of the Trust REMICs to receive
income from the performance of services or from assets not permitted under the
REMIC Provisions to be held by a REMIC (provided, however, that the receipt of
any income expressly permitted or contemplated by the terms of this Agreement
shall not be deemed to violate this clause) and (iii) not permit the creation of
any "interests," within the meaning of the REMIC Provisions, in the Upper-Tier
REMIC other than the Regular Certificates and the Class R Certificates or in the
Lower-Tier REMIC other than the Lower-Tier Regular Interests and the Class LR
Certificates. None of the Master Servicer, the Special Servicer or the Depositor
shall be responsible or liable for any failure by the Trustee to comply with the
provisions of this Section 4.04. The Depositor, the Master Servicer and the
Special Servicer shall cooperate in a timely manner with the Trustee in
supplying any information within the Depositor's, the Master Servicer's or the
Special Servicer's control (other than any confidential information) that is
reasonably necessary to enable the Trustee to perform its duties under this
Section 4.04.
(b) The tax matter person, the Master Servicer and the Special Servicer
each hereby covenants to perform its duties hereunder so as to maintain the
status of the Trust REMICs as REMICs (and the Master Servicer and the Special
Servicer shall assist the Trustee to the extent reasonably requested by the
Trustee and to the extent of information within the Master Servicer's or the
Special Servicer's possession or control). None of the tax matters person, the
Master Servicer or the Special Servicer shall knowingly take (or cause the
applicable Trust REMICs to take) any action or fail to take (or fail to cause to
be taken) any action within their respective control and the scope of their
respective duties under this Agreement that if taken or not taken, as the case
may be, would (i) endanger the status of either Trust REMIC as a REMIC, or (ii)
result in the imposition of a tax upon either Trust REMIC (including, but not
limited to the tax on prohibited transactions as defined in Section 860F(a) of
the Code), other than a tax at the highest marginal corporate tax rate on net
income from foreclosure property (any such endangerment or imposition, an
"Adverse REMIC Event"), unless the Trustee has received an Opinion of Counsel
(at the expense of the party requesting such action) to the effect that the
contemplated action will not result in an Adverse REMIC Event. In addition,
prior to taking any action with respect to either Trust REMIC, or causing either
Trust REMIC to take any action, that is not permitted under the terms of this
Agreement, the tax matters person, the Master Servicer and the Special Servicer
shall consult with the Trustee or its designee, in writing, with respect to
whether such action would cause an Adverse REMIC Event to occur.
(c) The following assumptions are to be used for purposes of determining
the anticipated payments of principal and interest for calculating the original
yield to maturity and original issue discount with respect to the Regular
Certificates: (i) each Mortgage Loan will pay principal and interest in
accordance with its terms and scheduled payments will be timely received on
their Due Dates, provided that the Mortgage Loans in the aggregate will prepay
in accordance with the Prepayment Assumption; (ii) none of the Master Servicer,
the Depositor and the Class LR Certificateholders will exercise the right
described in Section 9.01 of this Agreement to cause early termination of the
Trust Fund; and (iii) no Mortgage Loan is repurchased by MSMC or the Depositor
pursuant to Article II hereof.
SECTION 4.05. Imposition of Tax on the Trust Fund.
In the event that any tax, including interest, penalties or assessments,
additional amounts or additions to tax, is imposed on the Upper-Tier REMIC or
Lower-Tier REMIC, such tax shall be charged against amounts otherwise
distributable to the Holders of the Certificates; provided, that any taxes
imposed on any net income from foreclosure property pursuant to Code Section
860G(c) or any similar tax imposed by a state or local jurisdiction shall
instead be treated as an expense of the related REO Property in determining Net
REO Proceeds with respect to the REO Property (and until such taxes are paid,
the Special Servicer from time to time shall withdraw from the REO Account and
transfer to the Trustee amounts reasonably determined by the Trustee to be
necessary to pay such taxes, which the Trustee shall maintain in a separate,
non-interest-bearing account, and the Trustee shall remit to the Master Servicer
for deposit in the Collection Account the excess determined by the Trustee from
time to time of the amount in such account over the amount necessary to pay such
taxes) and shall be paid therefrom; provided that any such tax imposed on net
income from foreclosure property that exceeds the amount in any such reserve
shall be retained from Available Funds as provided in Section 3.06(vii) and the
next sentence. Except as provided in the preceding sentence, the Trustee is
hereby authorized to and shall retain or cause to be retained from the
Collection Account in determining the amount of Available Funds sufficient funds
to pay or provide for the payment of, and to actually pay, such tax as is
legally owed by the Upper-Tier REMIC, or Lower-Tier REMIC (but such
authorization shall not prevent the Trustee from contesting, at the expense of
the Trust Fund, any such tax in appropriate proceedings, and withholding payment
of such tax, if permitted by law, pending the outcome of such proceedings). The
Trustee is hereby authorized to and shall segregate or cause to be segregated,
into a separate non-interest bearing account, (i) the net income from any
"prohibited transaction" under Code Section 860F(a) or (ii) the amount of any
contribution to the Upper-Tier REMIC or Lower-Tier REMIC after the Startup Day
that is subject to tax under Code Section 860G(d) and use such income or amount,
to the extent necessary, to pay such tax (and return the balance thereof, if
any, to the Lower-Tier Distribution Account or the Upper-Tier Distribution
Account, as the case may be). To the extent that any such tax is paid to the
IRS, the Trustee shall retain an equal amount from future amounts otherwise
distributable to the Holders of the Class R or the Class LR Certificates, as the
case may be, and shall distribute such retained amounts to the Holders of
Regular Certificates or to the Trustee in respect of the Lower-Tier Regular
Interests, as applicable, until they are fully reimbursed and then to the
Holders of the Class R Certificates or the Class LR Certificates, as applicable.
Neither the Master Servicer, the Special Servicer nor the Trustee shall be
responsible for any taxes imposed on the Upper-Tier REMIC or Lower-Tier REMIC
except to the extent such tax is attributable to a breach of a representation or
warranty of the Master Servicer, the Special Servicer or the Trustee or an act
or omission of the Master Servicer, the Special Servicer or the Trustee in
contravention of this Agreement in both cases, provided, further, that such
breach, act or omission could result in liability under Section 6.03, in the
case of the Master Servicer or Section 4.04 or 8.01, in the case of the Trustee.
Notwithstanding anything in this Agreement to the contrary, in each such case,
the Master Servicer or the Special Servicer shall not be responsible for
Trustee's breaches, acts or omissions, and the Trustee shall not be responsible
for the breaches, acts or omissions of the Master Servicer or the Special
Servicer.
SECTION 4.06. Remittances; P&I Advances.
(a) "Applicable Monthly Payment" shall mean, for any Mortgage Loan with
respect to any month, (A) if such Mortgage Loan has been extended (other than
pursuant to Section 3.26) in accordance with the terms and conditions otherwise
set forth in this Agreement, the lesser of (1) the Extended Monthly Payment (net
of the related Servicing Fee) and (2) the Monthly Payment on the Mortgage Loan
prior to such extensions, and (B) if such Mortgage Loan is not described by the
preceding clause (A) (including any such Mortgage Loan as to which the related
Mortgaged Property has become an REO Property), the Monthly Payment; provided,
however, that for purposes of calculating the amount of any P&I Advance required
to be made by the Master Servicer or the Trustee, notwithstanding the amount of
such Applicable Monthly Payment, interest shall be calculated at the Net
Mortgage Rate plus the Trustee Fee Rate; and provided further that for purposes
of determining the amount of any P&I Advance, the Monthly Payment shall be as
reduced pursuant to any modification of a Mortgage Loan pursuant to Section
3.26.
(b) On the Master Servicer Remittance Date immediately preceding each
Distribution Date, the Master Servicer shall:
(i) remit to the Trustee for deposit in the Lower-Tier
Distribution Account an amount equal to the Prepayment
Premiums received by the Master Servicer in the Collection
Period preceding such Distribution Date;
(ii) remit to the Trustee for deposit in the Lower-Tier
Distribution Account an amount equal to the Available Funds
(other than the amounts referred to in clause (iii) below);
and
(iii) subject to Section 4.06(c), make a P&I Advance, by deposit
into the Lower-Tier Distribution Account, in an amount equal
to the sum of the Applicable Monthly Payments for each
Mortgage Loan to the extent such amounts were not received
on such Mortgage Loan prior to the close of business on the
related Due Date (or if the Due Date is not a Business Day,
the first Business Day thereafter) and therefore are not
included in the remittance described in the preceding clause
(ii).
(c) The Master Servicer shall not be required or permitted to make an
advance for Deferred Interest, Default Interest, Prepayment Premiums or Balloon
Payments. The amount required to be advanced in respect of Applicable Monthly
Payments on Mortgage Loans that have been subject to an Appraisal Reduction
Event will equal (i) the amount required to be advanced by the Master Servicer,
without giving effect to such Appraisal Reduction Amounts less (ii) an amount
equal to the product of (x) the amount required to be advanced by the Master
Servicer in respect to delinquent payments of interest without giving effect to
such Appraisal Reduction Amounts, and (y) a fraction, the numerator of which is
the Appraisal Reduction Amount with respect to such Mortgage Loan and the
denominator of which is the Stated Principal Balance as of the last day of the
related Collection Period.
(d) Any amount advanced by the Master Servicer pursuant to Section
4.06(b)(iii) shall constitute a P&I Advance for all purposes of this Agreement
and the Master Servicer shall be entitled to reimbursement (with interest at the
Advance Rate to the extent provided herein) thereof to the full extent as
otherwise set forth in this Agreement.
(e) If as of 11:00 A.M., New York City time, on any Distribution Date the
Master Servicer shall not have made the P&I Advance required to have been made
on the related Master Servicer Remittance Date pursuant to Section 4.06(b)(iii),
the Trustee shall no later than 1:00 p.m., New York City time, on such Business
Day deposit into the Lower-Tier Distribution Account in immediately available
funds an amount equal to the P&I Advances otherwise required to have been made
by the Master Servicer.
(f) Notwithstanding anything herein to the contrary, none of the Master
Servicer or the Trustee shall be obligated to make a P&I Advance as to any
Monthly Payment or Extended Monthly Payment on any date on which a P&I Advance
is otherwise required to be made by this Section 4.06 if the Master Servicer or
the Trustee, as applicable, determines that such advance will be a
Nonrecoverable Advance. The Master Servicer shall be required to provide notice
to the Trustee on or prior to the Master Servicer Remittance Date of any such
non-recoverability determination made on or prior to such date. The Trustee
shall be entitled to rely, conclusively, on any determination by the Master
Servicer that a P&I Advance, if made, would be a Nonrecoverable Advance;
provided, however, that if the Master Servicer has failed to make a P&I Advance
for reasons other than a determination by the Master Servicer that such Advance
would be a Nonrecoverable Advance, the Trustee shall make such advance within
the time periods required by Section 4.06(e) unless the Trustee, in good faith,
makes a determination prior to the times specified in Section 4.06(e) that such
advance would be a Nonrecoverable Advance. The Trustee, in determining whether
or not an Advance previously made is, or a proposed Advance, if made, would be,
a Nonrecoverable Advance shall be subject to the standards applicable to the
Master Servicer hereunder.
(g) The Master Servicer or the Trustee, as applicable, shall be entitled to
the reimbursement of P&I Advances it makes together with any related Advance
Interest Amount in respect of such P&I Advances, in each case, to the extent
permitted pursuant to Section 3.06(ii) of this Agreement and the Master Servicer
and Special Servicer hereby covenant and agree to promptly seek and effect the
reimbursement of such Advances from the related Borrowers to the extent
permitted by applicable law and the related Mortgage Loan; provided, however,
that with respect to any P&I Advances made with respect to the Magellan
Apartment Pool Loan, the Master Servicer or the Trustee, as applicable, will not
be entitled to interest on such P&I Advances that have accrued prior to the end
of the applicable grace period for such Mortgage Loan.
SECTION 4.07. Grantor Trust Reporting.
The parties intend that the portions of the Trust Fund consisting of (i)
the Default Interest, proceeds therefrom and the Class Q Distribution Account
and (ii) Deferred Interest, proceeds therefrom and the Deferred Interest
Distribution Account shall constitute, and that the affairs of the Trust Fund
(exclusive of the Trust REMICs) shall be conducted so as to qualify such portion
as, a "grantor trust" under the Code, and the provisions hereof shall be
interpreted consistently with this intention. In furtherance of such intention,
the Trustee shall furnish or cause to be furnished to Certificateholders and
shall file or cause to be filed with the IRS together with Form 1041 or such
other form as may be applicable, (i) to the Holders of the Class Q Certificates,
income with respect to their allocable share of Default Interest and the amount
of any Advance Interest Amounts paid to the Master Servicer, the Special
Servicer or the Trustee, as applicable, therefrom pursuant to Section 3.06(ii),
as such amounts are received by or accrue to the Trust Fund, as the case may be,
at the time or times and in the manner required by the Code and (ii) to the
Holders of the Classes of Regular Certificates entitled thereto as set forth in
Section 2.06(b), income with respect to their allocable share of Deferred
Interest, as such amounts are received by or accrue to the Trust Fund, as the
case may be, at the time or times and in the manner required by the Code.
<PAGE>
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The Certificates.
The Certificates consist of the Class A-1 Certificates, the Class A-2
Certificates, the Class A-3 Certificates, the Class X Certificates, the Class B
Certificates, the Class C Certificates, the Class D Certificates, the Class E
Certificates, the Class F Certificates, the Class G Certificates, the Class H
Certificates, the Class J Certificates, the Class Q Certificates, the Class R
Certificates and the Class LR Certificates.
The Class A-1, Class A-2, Class A-3, Class X, Class B, Class C, Class D,
Class E, Class F, Class G, Class H, Class J, Class Q, Class R and Class LR
Certificates will be substantially in the forms annexed hereto as Exhibits A-1
through A-14, respectively. The Certificates of each Class (other than the Class
Q, Class LR and Class R Certificates) will be issuable in registered form only,
in minimum denominations of authorized initial Certificate Principal Amount or
Notional Amount, as applicable, as described in the succeeding table, and
multiples of $1 in excess thereof. With respect to any Certificate or any
beneficial interest in a Certificate, the "Denomination" thereof shall be (i)
the amount (A) set forth on the face thereof or (B) in the case of any Global
Certificate, set forth on a schedule attached thereto or, in the case of any
beneficial interest in a Global Certificate, the product of the Percentage
Interest represented by such beneficial interest and the amount set forth on
such schedule of the related Global Certificate, (ii) expressed in terms of
initial Certificate Principal Amount or Notional Amount, as applicable, and
(iii) in an authorized denomination, as set forth below. With respect to the
Class G, Class H and Class J Certificates, on the Closing Date, the Trustee or
the Authenticating Agent shall execute and authenticate and the Certificate
Registrar shall deliver (i) Rule 144A global Class G, Class H and Class J
Certificates (the "Rule 144A Global Certificates") in definitive, fully
registered form without interest coupons, (ii) Regulation S global Class G,
Class H and Class J Certificates (the "Regulation S Global Certificates" and
together with the Rule 144A Global Certificates, the "Private Global
Certificates") in definitive, fully registered form without interest coupons or
(iii) one or more, if any, Individual Certificates, in each case substantially
in the form of Exhibits A-10, A-11 and A-12 hereto, respectively. Each
Certificate will share ratably in all rights of the related Class. The Class Q,
Class R and LR Certificates will each be issuable in one or more Individual
Certificates in minimum denominations of 5% Percentage Interests and integral
multiples of a 1% Percentage Interest in excess thereof and together aggregating
the entire 100% Percentage Interest in each such Class.
Aggregate
Denominations
of all Certificates
Minimum of Class
Certificate Principal (in Initial Denomination or
Class Amount Notional Amount)
----- --------------------- ----------------
A-1 $ 10,000.00 $ 176,000,000
A-2 $ 10,000.00 $ 102,000,000
A-3 $ 10,000.00 $ 393,239,000
B $ 10,000.00 $ 13,888,000
C $ 10,000.00 $ 46,293,000
D $ 10,000.00 $ 64,809,000
E $ 10,000.00 $ 46,292,000
F $ 10,000.00 $ 11,663,000
G $ 10,000.00 $ 30,000,000
H $ 10,000.00 $ 27,776,000
J $ 10,000.00 $ 13,888,151
X $ 100,000.00 $ 796,229,000
The Global Certificates shall be issued as one or more certificates
registered in the name of a nominee designated by the Depository, and Beneficial
Owners shall hold interests in the Global Certificates through the book-entry
facilities of the Depository in the minimum Denominations and aggregate
Denominations and Classes as set forth above. The Global Certificates shall in
all respects be entitled to the same benefits under this Agreement as Individual
Certificates authenticated and delivered hereunder.
Except insofar as pertains to any Individual Certificate, the Trust Fund,
the Paying Agent and the Trustee may for all purposes (including the making of
payments due on the Global Certificates and the giving of notice to Holders
thereof) deal with the Depository as the authorized representative of the
Beneficial Owners with respect to the Global Certificates for the purposes of
exercising the rights of Certificateholders hereunder; provided, however, that,
for purposes of providing information pursuant to Section 3.20 or transmitting
communications pursuant to Section 5.05(a), to the extent that the Depositor has
provided the Trustee with the names of Beneficial Owners, the Trustee shall
provide such information to such Beneficial Owners directly. The rights of
Beneficial Owners with respect to Global Certificates shall be limited to those
established by law and agreements among such Beneficial Owners and the
Depository and Depository Participants. Except in the limited circumstances
described below, Beneficial Owners of Public Global Certificates shall not be
entitled to physical certificates for the Public Global Certificates as to which
they are the Beneficial Owners. Requests and directions from, and votes of, the
Depository as Holder of the Global Certificates shall not be deemed inconsistent
if they are made with respect to different Beneficial Owners. Subject to the
restrictions on transfer set forth in Section 5.02 and Applicable Procedures, a
Beneficial Owner of a Private Global Certificate may request that the Depositor,
or an agent thereof, cause the Depository (or any Agent Member) to notify the
Certificate Registrar and the Certificate Custodian in writing of a request for
transfer or exchange of such beneficial interest for an Individual Certificate
or Certificates. Upon receipt of such a request and payment by the related
Beneficial Owner of any attendant expenses, the Depositor shall cause the
issuance and delivery of such Individual Certificates. The Certificate Registrar
may establish a reasonable record date in connection with solicitations of
consents from or voting by Certificateholders and give notice to the Depository
of such record date. Without the written consent of the Depositor and the
Certificate Registrar, no Global Certificate may be transferred by the
Depository except to a successor Depository that agrees to hold the Global
Certificates for the account of the Beneficial Owners.
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 Global Certificates (i) shall be delivered by the Certificate Registrar to
the Depository or, pursuant to the Depository's instructions on behalf of the
Depository to, and deposited with, the Certificate Custodian, and in either case
shall be registered in the name of Cede & Co. and (ii) shall bear a legend
substantially to the following effect:
"Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to the Certificate
Registrar 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."
The Global Certificates may be deposited with such other Depository as the
Certificate Registrar may from time to time designate, and shall bear such
legend as may be appropriate.
If (i) the Depository advises the Trustee in writing that the Depository is
no longer willing, qualified or able properly to discharge its responsibilities
as Depository, and the Depositor is unable to locate a qualified successor, (ii)
the Depositor or the Trustee, at its sole option, elects to terminate the
book-entry system through the Depository with respect to all or any portion of
any Class of Certificates or (iii) after the occurrence of an Event of Default,
Beneficial Owners owning not less than a majority in Certificate Principal
Amount or Notional Amount, as applicable, of the Global Certificate for any
Class then outstanding advise the Depository through Depository Participants in
writing that the continuation of a book-entry system through the Depository is
no longer in the best interest of the Beneficial Owner or Owners of such Global
Certificate, the Trustee shall notify the affected Beneficial Owners through the
Depository of the occurrence of such event and the availability of Individual
Certificates to such Beneficial Owner or Owners requesting them. Upon surrender
to the Trustee of Global Certificates by the Depository, accompanied by
registration instructions from the Depository for registration of transfer, the
Trustee shall issue the Individual Certificates. Neither the Trustee, the
Certificate Registrar, the Master Servicer, the Special Servicer nor the
Depositor shall be liable for any actions taken by the Depository or its
nominee, including, without limitation, any delay in delivery of such
instructions. Upon the issuance of Individual Certificates, the Trustee, the
Certificate Registrar, the Master Servicer, the Special Servicer, and the
Depositor shall recognize the Holders of Individual Certificates as
Certificateholders hereunder.
If the Trustee, its agents or the Master Servicer or Special Servicer has
instituted or has been directed to institute any judicial proceeding in a court
to enforce the rights of the Certificateholders under the Certificates, and the
Trustee, the Master Servicer or the Special Servicer has been advised by counsel
that in connection with such proceeding it is necessary or appropriate for the
Trustee, the Master Servicer or the Special Servicer to obtain possession of the
Certificates, the Trustee, the Master Servicer or the Special Servicer may in
its sole discretion determine that the Certificates represented by the Global
Certificates shall no longer be represented by such Global Certificates. In such
event, the Trustee or the Authenticating Agent will execute and authenticate and
the Certificate Registrar will deliver, in exchange for such Global
Certificates, Individual Certificates (and if the Trustee or the Certificate
Custodian has in its possession Individual Certificates previously executed, the
Authenticating Agent will authenticate and the Certificate Registrar will
deliver such Certificates) in a Denomination equal to the aggregate Denomination
of such Global Certificates.
If the Trust Fund ceases to be subject to Section 13 or 15(d) of the
Exchange Act, the Trustee shall cooperate with the Depositor to make available
to each Holder of a Class G, Class H, Class J, Class Q, Class R or Class LR
Certificate, upon request of such a Holder, information substantially equivalent
in scope to the information currently filed by the Trustee with the Commission
pursuant to the Exchange Act, plus such additional information required to be
provided for securities qualifying for resales under Rule 144A under the Act
which information shall be provided on a timely basis to the Trustee by the
Master Servicer, to the extent such information relates to the Mortgage Loans
and is in the possession of, or readily obtainable by, the Master Servicer. The
Trustee shall have no responsibility for the sufficiency under Rule 144A or any
other securities laws of any available information so furnished to any person
including any prospective purchaser of a Certificate or any interest therein,
nor for the content or accuracy of any information so furnished which was
prepared or delivered to the Trustee by another.
Each Certificate may be printed or in typewritten or similar form, and each
Certificate shall, upon original issue, be executed and authenticated by the
Trustee or the Authenticating Agent and delivered to the Depositor. All
Certificates shall be executed by manual or facsimile signature on behalf of the
Trustee or Authenticating Agent by an authorized officer or signatory.
Certificates bearing the signature of an individual who was at any time the
proper officer or signatory of the Trustee or Authenticating Agent shall bind
the Trustee or Authenticating Agent, notwithstanding that such individual has
ceased to hold such office or position prior to the delivery of such
Certificates or did not hold such office or position at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such Certificate
a certificate of authentication in the form set forth in Exhibits A-1 through
A-16 executed by the Authenticating Agent 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, Transfer and Exchange of Certificates.
(a) The Trustee shall keep or cause to be kept at the Corporate Trust
Office books (the "Certificate Register") for the registration, transfer and
exchange of Certificates (the Trustee, in such capacity, being the "Certificate
Registrar"). The names and addresses of all Certificateholders and the names and
addresses of the transferees of any Certificates shall be registered in the
Certificate Register; provided, however, in no event shall the Certificate
Registrar be required to maintain in the Certificate Register the names of the
individual participants holding beneficial interests in the Trust Fund through
the Depository. The Person in whose name any Certificate is so registered shall
be deemed and treated as the sole owner and Holder thereof for all purposes of
this Agreement and the Certificate Registrar, the Master Servicer, the Trustee,
any Paying Agent and any agent of any of them shall not be affected by any
notice or knowledge to the contrary. An Individual Certificate is transferable
or exchangeable only upon the surrender of such Certificate to the Certificate
Registrar at the Corporate Trust Office together with an assignment and transfer
(executed by the Holder or his duly authorized attorney), subject to the
applicable requirements of this Section 5.02. Upon request of the Trustee, the
Certificate Registrar shall provide the Trustee with the names, addresses and
Percentage Interests of the Holders.
(b) Upon surrender for registration of transfer of any Individual
Certificate, subject to the applicable requirements of this Section 5.02, the
Trustee shall execute and the Authenticating Agent shall duly authenticate in
the name of the designated transferee or transferees, one or more new
Certificates in Denominations of a like aggregate Denomination as the Individual
Certificate being surrendered. Such Certificates shall be delivered by the
Certificate Registrar in accordance with Section 5.02(e). Each Certificate
surrendered for registration of transfer shall be canceled and subsequently
destroyed by the Certificate Registrar. Each new Certificate issued pursuant to
this Section 5.02 shall be registered in the name of any Person as the
transferring Holder may request, subject to the applicable provisions of this
Section 5.02.
(c) In addition to the applicable provisions of this Section 5.02 and the
rules of the Depository, the exchange, transfer and registration of transfer of
Individual Certificates or beneficial interests in the Private Global
Certificates shall be subject to the following restrictions.
(i) Transfers between Holders of Individual Certificates. With
respect to the transfer and registration of transfer of an
Individual Certificate representing an interest in the Class G,
Class H, Class J, Class Q, Class R or Class LR Certificates to a
transferee that takes delivery in the form of an Individual
Certificate:
(A) The Certificate Registrar shall register the transfer
of an Individual Certificate if the requested transfer
is being made by a transferee who has provided the
Certificate Registrar with an Investment Representation
Letter substantially in the form of Exhibit D-1 hereto
(an "Investment Representation Letter"), to the effect
that the transfer is being made to a Qualified
Institutional Buyer in accordance with Rule 144A;
(B) The Certificate Registrar shall register the transfer
of an Individual Certificate pursuant to Regulation S
after the expiration of the Restricted Period if (1)
the transferor has provided the Certificate Registrar
with a Regulation S Transfer Certificate substantially
in the form of Exhibit K hereto (a "Regulation S
Transfer Certificate"), and (2) the transferee
furnishes to the Certificate Registrar an Investment
Representation Letter; and
(C) The Certificate Registrar shall register the transfer
of an Individual Certificate (other than a Residual
Certificate) if prior to the transfer such transferee
furnishes to the Certificate Registrar (a) an
Investment Representation Letter to the effect that the
transfer is being made to an Institutional Accredited
Investor in accordance with an applicable exemption
under the Act, (b) an opinion of counsel acceptable to
the Certificate Registrar that such transfer is in
compliance with the Act and (c) the Certificate
Registrar shall register the transfer of an Individual
Certificate only if prior to the transfer the
transferee furnishes to the Certificate Registrar a
written undertaking by the transferor to reimburse the
Trust for any costs incurred by it in connection with
the proposed transfer;
(ii) Transfers within the Private Global Certificates. Notwithstanding
any provision to the contrary herein, so long as a Private Global
Certificate remains outstanding and is held by or on behalf of
the Depository, transfers within the Private Global Certificates
shall only be made in accordance with this Section 5.02(c)(ii).
(A) Rule 144A Global Certificate to Regulation S Global
Certificate During the Restricted Period. If, during
the Restricted Period, a Beneficial Owner of an
interest in a Rule 144A Global Certificate wishes at
any time to transfer its beneficial interest in such
Rule 144A Global Certificate to a Person who wishes to
take delivery thereof in the form of a beneficial
interest in the related Regulation S Global
Certificate, such Beneficial Owner may, in addition to
complying with all applicable rules and procedures of
the Depository and Cedel or Euroclear applicable to
transfers by their respective participants (the
"Applicable Procedures"), transfer or cause the
transfer of such beneficial interest for an equivalent
beneficial interest in such Regulation S Global
Certificate only upon compliance with the provisions of
this Section 5.02(c)(ii)(A). Upon receipt by the
Certificate Registrar at the Corporate Trust Office of
(1) written instructions given in accordance with the
Applicable Procedures from an Agent Member directing
the Certificate Registrar to credit or cause to be
credited to another specified Agent Member's account a
beneficial interest in the Regulation S Global
Certificate in an amount equal to the Denomination of
the beneficial interest in the Rule 144A Global
Certificate to be transferred, (2) a written order
given in accordance with the Applicable Procedures
containing information regarding the account of the
Agent Member and the Euroclear or Cedel account, as the
case may be, to be credited with, and the account of
the Agent Member to be debited for, such beneficial
interest, and (3) a certificate in the form of Exhibit
L hereto given by the Beneficial Owner of such
interest, the Certificate Registrar shall instruct the
Depository or the Certificate Custodian, as applicable,
to reduce the Denomination of the Rule 144A Global
Certificate by the Denomination of the beneficial
interest in the Rule 144A Global Certificate to be so
transferred and, concurrently with such reduction, to
increase the Denomination of the Regulation S Global
Certificate by the Denomination of the beneficial
interest in the Rule 144A Global Certificate to be so
transferred, and to credit or cause to be credited to
the account of the Person specified in such
instructions (who shall be an Agent Member acting for
or on behalf of Euroclear or Cedel, or both, as the
case may be) a beneficial interest in the Regulation S
Global Certificate having a Denomination equal to the
amount by which the Denomination of the Rule 144A
Global Certificate was reduced upon such transfer.
(B) Rule 144A Global Certificate to Regulation S Global
Certificate After the Restricted Period. If, after the
Restricted Period, a Beneficial Owner of an interest in
a Rule 144A Global Certificate wishes at any time to
transfer its beneficial interest in such Rule 144A
Global Certificate to a Person who wishes to take
delivery thereof in the form of a beneficial interest
in the related Regulation S Global Certificate, such
holder may, in addition to complying with all
Applicable Procedures, transfer or cause the transfer
of such beneficial interest for an equivalent
beneficial interest in such Regulation S Global
Certificate only upon compliance with the provisions of
this Section 5.02(c)(ii)(B). Upon receipt by the
Certificate Registrar at the Corporate Trust Office of
(1) written instructions given in accordance with the
Applicable Procedures from an Agent Member directing
the Certificate Registrar to credit or cause to be
credited to another specified Agent Member's account a
beneficial interest in the Regulation S Global
Certificate in an amount equal to the Denomination of
the beneficial interest in the Rule 144A Global
Certificate to be transferred, (2) a written order
given in accordance with the Applicable Procedures
containing information regarding the account of the
Agent Member and, in the case of a transfer pursuant to
and in accordance with Regulation S, the Euroclear or
Cedel account, as the case may be, to be credited with,
and the account of the Agent Member to be debited for,
such beneficial interest, and (3) a certificate in the
form of Exhibit M hereto given by the Beneficial Owner
of such interest, the Certificate Registrar shall
instruct the Depository or the Certificate Custodian,
as applicable, to reduce the Denomination of the Rule
144A Global Certificate by the aggregate Denomination
of the beneficial interest in the Rule 144A Global
Certificate to be so transferred and, concurrently with
such reduction, to increase the Denomination of the
Regulation S Global Certificate by the aggregate
Denomination of the beneficial interest in the Rule
144A Global Certificate to be so transferred, and to
credit or cause to be credited to the account of the
Person specified in such instructions a beneficial
interest in the Regulation S Global Certificate having
a Denomination equal to the amount by which the
Denomination of the Rule 144A Global Certificate was
reduced upon such transfer.
(C) Regulation S Global Certificate to Rule 144A Global
Certificate. If the Beneficial Owner of an interest in
a Regulation S Global Certificate wishes at any time to
transfer its beneficial interest in such Regulation S
Global Certificate to a Person who wishes to take
delivery thereof in the form of a beneficial interest
in the related Rule 144A Global Certificate, such
Beneficial Owner may, in addition to complying with all
Applicable Procedures, transfer or cause the transfer
of such beneficial interest for an equivalent
beneficial interest in such Rule 144A Global
Certificate only upon compliance with the provisions of
this Section 5.02(c)(ii)(C). Upon receipt by the
Certificate Registrar at the Corporate Trust Office of
(1) written instructions given in accordance with the
Applicable Procedures from an Agent Member directing
the Certificate Registrar to credit or cause to be
credited to another specified Agent Member's account a
beneficial interest in the Rule 144A Global Certificate
in an amount equal to the Denomination of the
beneficial interest in the Regulation S Global
Certificate to be transferred, (2) a written order
given in accordance with the Applicable Procedures
containing information regarding the account of the
Agent Member to be credited with, and the account of
the Agent Member or, if such account is held for
Euroclear or Cedel, the Euroclear or Cedel account, as
the case may be, to be debited for, such beneficial
interest, and (3) with respect to a transfer of a
beneficial interest in a Regulation S Global
Certificate for a beneficial interest in the related
Rule 144A Global Certificate (i) during the Restricted
Period, a certificate in the form of Exhibit N hereto
given by the holder of such beneficial interest or (ii)
after the Restricted Period, an Investment
Representation Letter from the transferee to the effect
that such transferee is a Qualified Institutional
Buyer, the Certificate Registrar shall instruct the
Depository or the Certificate Custodian, as applicable,
to reduce the Denomination of the Regulation S Global
Certificate by the aggregate Denomination of the
beneficial interest in the Regulation S Global
Certificate to be transferred, and, concurrently with
such reduction, to increase the Denomination of the
Rule 144A Global Certificate by the aggregate
Denomination of the beneficial interest in the
Regulation S Global Certificate to be so transferred,
and to credit or cause to be credited to the account of
the Person specified in such instructions a beneficial
interest in such Rule 144A Global Certificate having a
Denomination equal to the amount by which the
Denomination of the Regulation S Global Certificate was
reduced upon such transfer.
(iii) Transfers from the Private Global Certificates to Individual
Certificates. Any and all transfers from a Private Global
Certificate to a transferee wishing to take delivery in the form
of an Individual Certificate will require the transferee to take
delivery subject to the restrictions on the transfer of such
Individual Certificate described on the face of such Certificate,
and such transferee agrees that it will transfer such Individual
Certificate only as provided therein and herein. No such transfer
shall be made and the Certificate Registrar shall not register
any such transfer unless such transfer is made in accordance with
this Section 5.02(c)(iii).
(A) Transfers of a beneficial interest in a
Private Global Certificate to an
Institutional Accredited Investor will
require delivery in the form of an Individual
Certificate and the Certificate Registrar
shall register such transfer only upon
compliance with the provisions of Section
5.02(c)(i)(C).
(B) Transfers of a beneficial interest in a
Private Global Certificate to a Qualified
Institutional Buyer or a Regulation S
Investor wishing to take delivery in the form
of an Individual Certificate will be
registered by the Certificate Registrar only
upon compliance with the provisions of
Sections 5.02(c)(i)(A) and (C), respectively.
(C) Notwithstanding the foregoing, no transfer of
a beneficial interest in a Regulation S
Global Certificate to an Individual
Certificate pursuant to subparagraph (B)
above shall be made prior to the expiration
of the Restricted Period.
(D) Upon acceptance for exchange or transfer of a
beneficial interest in a Private Global
Certificate for an Individual Certificate, as
provided herein, the Certificate Registrar
shall endorse on the schedule affixed to the
related Private Global Certificate (or on a
continuation of such schedule affixed to such
Private Global Certificate and made a part
thereof) an appropriate notation evidencing
the date of such exchange or transfer and a
decrease in the Denomination of such Private
Global Certificate equal to the Denomination
of such Individual Certificate issued in
exchange therefor or upon transfer thereof.
Unless determined otherwise by the
Certificate Registrar in accordance with
applicable law, an Individual Certificate
issued upon transfer of or exchange for a
beneficial interest in the Private Global
Certificate shall bear the Securities Legend.
(iv) Transfers of Individual Certificates to the Private Global
Certificates. If a Holder of an Individual Certificate wishes at
any time to transfer such Certificate to a Person who wishes to
take delivery thereof in the form of a beneficial interest in the
related Regulation S Global Certificate or the related Rule 144A
Global Certificate, such transfer may be effected only in
accordance with all applicable rules and procedures of the
Depository applicable to transfers by their respective
participants (the "Applicable Procedures"), and this Section
5.02(c)(iv). Upon receipt by the Certificate Registrar at the
Corporate Trust Office of (1) the Individual Certificate to be
transferred with an assignment and transfer pursuant to Section
5.02(a), (2) written instructions given in accordance with the
Applicable Procedures from an Agent Member directing the
Certificate Registrar to credit or cause to be credited to
another specified Agent Member's account a beneficial interest in
such Regulation S Global Certificate or such Rule 144A Global
Certificate, as the case may be, in an amount equal to the
Denomination of the Individual Certificate to be so transferred,
(3) a written order given in accordance with the Applicable
Procedures containing information regarding the account of the
Agent Member and, in the case of any transfer pursuant to
Regulation S, the Euroclear or Cedel account, as the case may be,
to be credited with such beneficial interest, and (4) (x) an
Investment Representation Letter from the transferee and, if
delivery is to be taken in the form of a beneficial interest in
the Regulation S Global Certificate, a Regulation S Transfer
Certificate from the transferor or (y) an Investment
Representation Letter from the transferee to the effect that such
transferee is a Qualified Institutional Buyer if delivery is to
be taken in the form of a beneficial interest in the Rule 144A
Global Certificate, the Certificate Registrar shall cancel such
Individual Certificate, execute and deliver a new Individual
Certificate for the Denomination of the Individual Certificate
not so transferred, registered in the name of the Holder, and the
Certificate Registrar shall instruct the Depository as the
Certificate Custodian, as applicable, to increase the
Denomination of the Regulation S Global Certificate or the Rule
144A Global Certificate, as the case may be, by the Denomination
of the Individual Certificate to be so transferred, and to credit
or cause to be credited to the account of the Person specified in
such instructions who, in the case of any increase in the
Regulation S Global Certificate during the Restricted Period,
shall be an Agent Member acting for or on behalf of Euroclear or
Cedel, or both, as the case may be, a corresponding Denomination
of the Rule 144A Global Certificate or the Regulation S Global
Certificate, as the case may be.
It is the intent of the foregoing that under no circumstances may
an Institutional Accredited Investor that is not a Qualified
Institutional Buyer take delivery in the form of a beneficial
interest in a Private Global Certificate.
(iv) All Transfers. An exchange of a beneficial interest in a Private
Global Certificate for an Individual Certificate or Certificates,
an exchange of an Individual Certificate or Certificates for a
beneficial interest in the Private Global Certificate and an
exchange of an Individual Certificate or Certificates for another
Individual Certificate or Certificates (in each case, whether or
not such exchange is made in anticipation of subsequent transfer,
and in the case of the Private Global Certificates, so long as
the Private Global Certificates remain outstanding and are held
by or on behalf of the Depository), may be made only in
accordance with this Section 5.02 and in accordance with the
rules of the Depository and Applicable Procedures.
(d) If Certificates are issued upon the transfer, exchange or replacement
of Certificates not bearing the Securities Legend, the Certificates so issued
shall not bear the Securities Legend. If Certificates are issued upon the
transfer, exchange or replacement of Certificates bearing the Securities Legend,
or if a request is made to remove the Securities Legend on a Certificate, the
Certificates so issued shall bear the Securities Legend, or the Securities
Legend shall not be removed, as the case may be, unless there is delivered to
the Certificate Registrar such satisfactory evidence, which may include an
opinion of counsel (at the expense of the party requesting the removal of such
legend) familiar with United States securities laws, as may be reasonably
required by the Certificate Registrar, that neither the Securities Legend nor
the restrictions on transfers set forth therein are required to ensure that
transfers of any Certificate comply with the provisions of Rule 144A or Rule 144
under the Act or that such Certificate is not a "restricted security" within the
meaning of Rule 144 under the Act. Upon provision of such satisfactory evidence,
the Certificate Registrar shall execute and deliver a Certificate that does not
bear the Securities Legend.
(e) Subject to the restrictions on transfer and exchange set forth in this
Section 5.02, the Holder of any Individual Certificate may transfer or exchange
the same in whole or in part (with a Denomination equal to any authorized
Denomination) by surrendering such Certificate at the Corporate Trust Office or
at the office of any transfer agent appointed as provided under this Agreement,
together with an instrument of assignment or transfer (executed by the Holder or
its duly authorized attorney), in the case of transfer, and a written request
for exchange in the case of exchange. Following a proper request for transfer or
exchange, the Certificate Registrar shall, within five Business Days of such
request if made at such Corporate Trust Office, or within ten Business Days if
made at the office of a transfer agent (other than the Certificate Registrar),
execute and deliver at the Corporate Trust Office or at the office of such
transfer agent, as the case may be, to the transferee (in the case of transfer)
or Holder (in the case of exchange) or send by first class mail (at the risk of
the transferee in the case of transfer or Holder in the case of exchange) to
such address as the transferee or Holder, as applicable, may request, an
Individual Certificate or Certificates, as the case may require, for a like
aggregate Denomination and in such Denomination or Denominations as may be
requested. The presentation for transfer or exchange of any Individual
Certificate shall not be valid unless made at the Corporate Trust Office or at
the office of a transfer agent by the registered Holder in person, or by a duly
authorized attorney-in-fact. The Certificate Registrar may decline to accept any
request for an exchange or registration of transfer of any Certificate during
the period of fifteen days preceding any Distribution Date.
(f) An Individual Certificate (other than an Individual Certificate issued
in exchange for a beneficial interest in a Public Global Certificate pursuant to
Section 5.01) or a beneficial interest in a Private Global Certificate may only
be transferred to Eligible Investors in accordance with the provisions set forth
herein. In the event that a Responsible Officer of the Certificate Registrar
becomes aware that such an Individual Certificate or beneficial interest in a
Private Global Certificate is being held by or for the benefit of a Person who
is not an Eligible Investor, or that such holding is unlawful under the laws of
a relevant jurisdiction, then the Certificate Registrar shall have the right to
void such transfer, if permitted under applicable law, or to require the
investor to sell such Individual Certificate or beneficial interest in a Private
Global Certificate to an Eligible Investor within fourteen days after notice of
such determination and each Certificateholder by its acceptance of a Certificate
authorizes the Certificate Registrar to take such action.
(g) Subject to the provisions of this Section 5.02 regarding transfer and
exchange, transfers of the Global Certificates shall be limited to transfers of
such Global Certificates in whole, but not in part, to nominees of the
Depository or to a successor of the Depository or such successor's nominee.
(h) No fee or service charge shall be imposed by the Certificate Registrar
for its services in respect of any registration of transfer or exchange referred
to in this Section 5.02 other than for transfers to Institutional Accredited
Investors, as provided herein. In connection with any transfer to a transferee
that is not a QIB, the transferor shall reimburse the Trust Fund for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided herein) incurred by the Certificate
Registrar in connection with such transfer. The Certificate Registrar may
require payment by each transferor of a sum sufficient to cover any tax, expense
or other governmental charge payable in connection with any such transfer.
(i) The Certificate Registrar may as a condition of the registration of any
transfer of the Class E, Class F, Class G, Class H, Class J, Class Q, Class R
and Class LR Certificates require the transferor to furnish other
certifications, legal opinions or other information (at the transferor's
expense) as it may reasonably require to confirm that the proposed transfer is
being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Act and other applicable laws.
(j) Neither the Depositor, the Master Servicer, the Trustee nor the
Certificate Registrar is obligated to register or qualify the Class E, Class F,
Class G, Class H, Class J, Class Q, Class R or Class LR Certificates under the
Act or any other securities law or to take any action not otherwise required
under this Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Depositor, the
Master Servicer, the Trustee and the Certificate Registrar against any loss,
liability or expense that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.
(k) No transfer of any Class B, Class C, Class D, Class E, Class F, Class
G, Class H, Class J, Class Q, Class R or Class LR Certificate (each, a
"Restricted Certificate") shall be made to (i) an employee benefit plan or other
retirement arrangement, including an individual retirement account or a Keogh
plan, which is subject to Title I of ERISA or Section 4975 of the Code, or a
governmental plan (as defined in Section 3(32) of ERISA) that is subject to any
federal, state or local law ("Similar Law") which is, to a material extent,
similar to the foregoing provisions of ERISA or the Code (each, a "Plan") or
(ii) a collective investment fund in which such Plans are invested, an insurance
company that is using assets of separate accounts or general accounts which
include assets of Plans (or which are deemed pursuant to ERISA or Similar Law to
include assets of Plans) or other Person acting on behalf of any such Plan or
using the assets of any such Plan to acquire any such Restricted Certificate,
other than (with respect to any transfer of a Restricted Certificate that is a
Subordinated Certificate) an insurance company investing the assets of its
general account under circumstances whereby the purchase and holding of such
Restricted Certificate by such insurance company would be exempt from the
prohibited transaction provisions of ERISA and Section 4975 of the Code under
Prohibited Transaction Class Exemption 95-60. Each prospective transferee of a
Restricted Certificate that takes the form of an Individual Certificate shall
either (1) deliver to the Depositor, the Certificate Registrar and the Trustee a
representation letter, substantially in the form of Exhibit D-2 hereto, stating
that the prospective transferee is not a Person referred to in (i) or (ii) above
or (2) in the event the transferee is such a Person, except in the case of a
Residual Certificate, which may not be transferred unless the transferee
represents it is not such a Person, the prospective transferee shall provide to
the Depositor, the Trustee and the Certificate Registrar an opinion of counsel
which establishes to the satisfaction of the Depositor, the Trustee and the
Certificate Registrar that the purchase or holding of the Restricted
Certificates by or on behalf of a Plan will not result in the assets of the
Trust Fund being deemed to be "plan assets" and subject to Title I of ERISA,
Section 4975 of the Code or Similar Law, will not constitute or result in a
prohibited transaction within the meaning of ERISA or Section 4975 of the Code,
or a materially similar characterization under any Similar Law, and will not
subject the Master Servicer, the Special Servicer, the Depositor, the Trustee or
the Certificate Registrar to any obligation or liability (including obligations
or liabilities under ERISA, Section 4975 of the Code or any Similar Law) in
addition to those set forth in this Agreement, which opinion of counsel shall
not be an expense of the Trustee, the Trust Fund, the Master Servicer, the
Special Servicer, the Certificate Registrar or the Depositor. The Certificate
Registrar shall not register the transfer of an Individual Certificate that is a
Restricted Certificate unless the transferee has provided the representation
letter or opinion of counsel referred to in the preceding sentence. The
transferee of a beneficial interest in a Global Certificate that is a Restricted
Certificate shall be deemed to represent that it is not a Person referred to in
(i) or (ii) above. Any transfer of a Restricted Certificate that would result in
a prohibited transaction under ERISA or Section 4975 of the Code, or a
materially similar characterization under any Similar Law, shall be deemed
absolutely null and void ab initio.
(l) Each Person who has or acquires any Ownership Interest shall be deemed
by the acceptance or acquisition of such Ownership Interest to have agreed to be
bound by the following provisions and the rights of each Person acquiring any
Ownership Interest are expressly subject to the following provisions:
(i) Each Person acquiring or holding any Ownership Interest
shall be a Permitted Transferee and shall not acquire or
hold such Ownership Interest as agent (including a broker,
nominee or other middleman) on behalf of any Person that is
not a Permitted Transferee. Any such Person shall promptly
notify the Certificate Registrar of any change or impending
change in its status (or the status of the beneficial owner
of such Ownership Interest) as a Permitted Transferee. Any
acquisition described in the first sentence of this Section
5.02(l) by a Person who is not a Permitted Transferee or by
a Person who is acting as an agent of a Person who is not a
Permitted Transferee shall be void and of no effect, and the
immediately preceding owner who was a Permitted Transferee
shall be restored to registered and beneficial ownership of
the Ownership Interest as fully as possible.
(ii) No Ownership Interest may be Transferred, and no such
Transfer shall be registered in the Certificate Register,
without the express written consent of the Certificate
Registrar, and the Certificate Registrar shall not recognize
the Transfer, and such proposed Transfer shall not be
effective, without such consent with respect thereto. In
connection with any proposed Transfer of any Ownership
Interest, the Certificate Registrar shall, as a condition to
such consent, (x) require delivery to it in form and
substance satisfactory to it, and the proposed transferee
shall deliver to the Certificate Registrar and to the
proposed transferor an affidavit in substantially the form
attached as Exhibit C-1 (a "Transferee Affidavit") of the
proposed transferee (A) that such proposed transferee is a
Permitted Transferee and (B) stating that (i) the proposed
transferee historically has paid its debts as they have come
due and intends to do so in the future, (ii) the proposed
transferee understands that, as the holder of an Ownership
Interest, it may incur liabilities in excess of cash flows
generated by the residual interest, (iii) the proposed
transferee intends to pay taxes associated with holding the
Ownership Interest as they become due, (iv) the proposed
transferee will not transfer the Ownership Interest to any
Person that does not provide a Transferee Affidavit or as to
which the proposed transferee has actual knowledge that such
Person is not a Permitted Transferee or is acting as an
agent (including a broker, nominee or other middleman) for a
Person that is not a Permitted Transferee, and (v) the
proposed transferee expressly agrees to be bound by and to
abide by the provisions of this Section 5.02(e) and (y)
other than in connection with the initial issuance of the
Class R and Class LR Certificates, require a statement from
the proposed transferor substantially in the form attached
as Exhibit C-2 (the "Transferor Letter"), that the proposed
transferor has no actual knowledge that the proposed
transferee is not a Permitted Transferee and has no actual
knowledge or reason to know that the proposed transferee's
statements in the preceding clauses (x)(B)(i) or (iii) are
false.
(iii) Notwithstanding the delivery of a Transferee Affidavit by a
proposed transferee under clause (ii) above, if a
Responsible Officer of the Certificate Registrar has actual
knowledge that the proposed transferee is not a Permitted
Transferee, no Transfer to such proposed transferee shall be
effected and such proposed Transfer shall not be registered
on the Certificate Register; provided, however, that the
Certificate Registrar shall not be required to conduct any
independent investigation to determine whether a proposed
transferee is a Permitted Transferee. Upon notice to the
Certificate Registrar that there has occurred a Transfer to
any Person that is a Disqualified Organization or an agent
thereof (including a broker, nominee, or middleman) in
contravention of the foregoing restrictions, and in any
event not later than 60 days after a request for information
from the transferor of such Ownership Interest, or such
agent, the Certificate Registrar and the Trustee agree to
furnish to the IRS and the transferor of such Ownership
Interest or such agent such information necessary to the
application of Section 860E(e) of the Code as may be
required by the Code, including, but not limited to, the
present value of the total anticipated excess inclusions
with respect to such Class R or Class LR Certificate (or
portion thereof) for periods after such Transfer. At the
election of the Certificate Registrar and the Trustee, the
Certificate Registrar and the Trustee may charge a
reasonable fee for computing and furnishing such information
to the transferor or to such agent referred to above;
provided, however, that such Persons shall in no event be
excused from furnishing such information.
SECTION 5.03. 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 Certificate Registrar such security or indemnity as may be required by it
to save it, the Trustee and the Master Servicer harmless, then, in the absence
of actual knowledge by a Responsible Officer of the Certificate Registrar that
such Certificate has been acquired by a bona fide purchaser, the Trustee or the
Authenticating Agent shall execute and authenticate and the Certificate
Registrar shall deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of the same Class and
of like tenor and Percentage Interest. Upon the issuance of any new Certificate
under this Section 5.03, 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 expenses (including the fees and expenses of
the Certificate Registrar) connected therewith. Any replacement Certificate
issued pursuant to this Section 5.03 shall constitute complete and indefeasible
evidence of ownership of the corresponding interest in the Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
SECTION 5.04. Appointment of Paying Agent.
The Trustee may appoint a paying agent for the purpose of making
distributions to Certificateholders pursuant to Section 4.01. The Trustee shall
cause such Paying Agent, if other than the Trustee or the Master Servicer, to
execute and deliver to the Master Servicer and the Trustee an instrument in
which such Paying Agent shall agree with the Master Servicer and the Trustee
that such Paying Agent will hold all sums held by it for the payment to
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums have been paid to the Certificateholders or disposed of
as otherwise provided herein. The initial Paying Agent shall be the Trustee.
Except for State Street Bank and Trust Company, as the initial Paying Agent, the
Paying Agent shall at all times be an entity having a long-term unsecured debt
rating of at least "AA" by Fitch and S&P, or shall be otherwise acceptable to
each Rating Agency.
SECTION 5.05. Access to Certificateholders' Names and Addresses.
(a) If any Certificateholder (for purposes of this Section 5.05, an
"Applicant") applies in writing to the Certificate Registrar, and such
application states that the Applicant desires to communicate with other
Certificateholders, the Certificate Registrar shall furnish or cause to be
furnished to such Applicant a list of the names and addresses of the
Certificateholders as of the most recent Record Date, at the expense of the
Applicant.
(b) Every Certificateholder, by receiving and holding its Certificate,
agrees with the Trustee that the Trustee and the Certificate Registrar shall not
be held accountable in any way by reason of the disclosure of any information as
to the names and addresses of the Certificateholders hereunder, regardless of
the source from which such information was derived.
SECTION 5.06. Actions of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Agreement to be given or taken by
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
agent duly appointed in writing; and except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, when required, to the Depositor or the Master
Servicer. Proof of execution of any such instrument or of a writing appointing
any such agent shall be sufficient for any purpose of this Agreement and
conclusive in favor of the Trustee, the Depositor and the Master Servicer, if
made in the manner provided in this Section.
(b) The fact and date of the execution by any Certificateholder of any such
instrument or writing may be proved in any reasonable manner which the Trustee
deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent, waiver
or other act by a Certificateholder shall bind every Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, in respect of anything done, or omitted to be done, by the
Trustee, the Depositor or the Master Servicer in reliance thereon, whether or
not notation of such action is made upon such Certificate.
(d) The Trustee or Certificate Registrar may require such additional proof
of any matter referred to in this Section 5.06 as it shall deem necessary.
SECTION 5.07. Authenticating Agent.
The Trustee may appoint an Authenticating Agent to execute and to
authenticate Certificates. The Authenticating Agent must be acceptable to the
Depositor and must be a corporation organized and doing business under the laws
of the United States of America or any state, having a principal office and
place of business in a state and city acceptable to the Depositor, having a
combined capital and surplus of at least $15,000,000, authorized under such laws
to do a trust business and subject to supervision or examination by federal or
state authorities. The Trustee shall serve as the initial Authenticating Agent
and the Trustee hereby accepts such appointment.
Any corporation into which the Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Authenticating Agent
shall be party, or any corporation succeeding to the corporate agency business
of the Authenticating Agent, shall be the Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.
The Authenticating Agent may at any time resign by giving at least 30 days'
advance written notice of resignation to the Trustee and the Depositor. The
Trustee may at any time terminate the agency of the Authenticating Agent by
giving written notice of termination to the Authenticating Agent and the
Depositor. Upon receiving a notice of resignation or upon such a termination, or
in case at any time the Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 5.07, the Trustee promptly shall
appoint a successor Authenticating Agent, which shall be acceptable to the
Depositor, and shall mail notice of such appointment to all Certificateholders.
Any successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally named as
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 5.07.
The Authenticating Agent shall have no responsibility or liability for any
action taken by it as such at the direction of the Trustee. Any compensation
paid to the Authenticating Agent shall be an unreimbursable expense of the
Trustee.
SECTION 5.08. Appointment of Custodians.
The Trustee may appoint one or more Custodians to hold all or a portion of
the Mortgage Files as agent for the Trustee, by entering into a Custodial
Agreement; provided that no Custodial Agreement shall be required in the event
the Trustee is serving as Custodian. The Trustee agrees to comply with the terms
of each Custodial Agreement and to enforce the terms and provisions thereof
against the Custodian for the benefit of the Certificateholders. Each Custodian
shall be a depository institution subject to supervision by federal or state
authority, shall have a combined capital and surplus of at least $10,000,000,
shall have a long-term debt rating of at least "BBB" from Fitch and S&P, unless
the Trustee shall have received prior written confirmation from each Rating
Agency that the appointment of such Custodian would not cause such Rating Agency
to withdraw, qualify or downgrade any of its then-current ratings on the
Certificates, and shall be qualified to do business in the jurisdiction in which
it holds any Mortgage File. Each Custodial Agreement may be amended only as
provided in Section 10.07. Any compensation paid to the Custodian shall be an
unreimbursable expense of the Trustee. The Trustee shall serve as the initial
Custodian. The Custodian, if the Custodian is not the Trustee, shall maintain a
fidelity bond in the form and amount that are customary for securitizations
similar to the securitization evidenced by this Agreement, with the Trustee
named as loss payee. The Custodian shall be deemed to have complied with this
provision if one of its respective Affiliates has such fidelity bond coverage
and, by the terms of such fidelity bond, the coverage afforded thereunder
extends to the Custodian. In addition, the Custodian shall keep in force during
the term of this Agreement a policy or policies of insurance covering loss
occasioned by the errors and omissions of its officers and employees in
connection with its obligations hereunder in the form and amount that are
customary for securitizations similar to the securitization evidenced by this
Agreement, with the Trustee named as loss payee. All fidelity bonds and policies
of errors and omissions insurance obtained under this Section 5.08 shall be
issued by a Qualified Insurer, or by any other insurer, that, as confirmed by
each Rating Agency in writing to the Trustee, would not in and of itself result
in the downgrade, withdrawal or qualification of any of the ratings assigned to
any Class of Certificates.
<PAGE>
ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER AND THE SPECIAL SERVICER
SECTION 6.01. Liability of the Depositor, the Master Servicer and
the Special Servicer.
The Depositor, the Master Servicer and the Special Servicer each shall be
liable in accordance herewith only to the extent of the obligations specifically
imposed by this Agreement. Each of the Master Servicer and the Special Servicer
shall indemnify the Depositor, and any employee, director or officer of the
Depositor, and the Trust Fund and hold the Depositor and any employee, director
or officer of the Depositor, and the Trust Fund harmless against any loss,
liability or expense incurred by such parties (i) in connection with any willful
misconduct, bad faith, fraud or negligence in the performance of duties of the
Master Servicer or the Special Servicer, as the case may be, or by reason of
negligent disregard of the Master Servicer's or Special Servicer's, as the case
may be, obligations or duties hereunder, or (ii) as a result of the breach by
the Master Servicer or the Special Servicer, as the case may be, of any of its
representations or warranties contained herein.
SECTION 6.02. Merger or Consolidation of the Master Servicer and the
Special Servicer.
Subject to the following paragraph, the Master Servicer will keep in full
effect its existence, rights and good standing as a corporation under the laws
of the State of Delaware and will not jeopardize its ability to do business in
each jurisdiction in which the Mortgaged Properties are located or 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 Master Servicer and the Special Servicer 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 any Person resulting from any merger or consolidation
to which it shall be a party, or any Person succeeding to its business, shall be
the successor of the Master Servicer or the Special Servicer, as the case may
be, hereunder, and shall be deemed to have assumed all of the liabilities of the
Master Servicer or the Special Servicer, as the case may be, hereunder, if each
of the Rating Agencies has confirmed in writing that such merger or
consolidation or transfer of assets and succession, in and of itself, will not
cause a downgrade, qualification or withdrawal of the then current ratings
assigned by such Rating Agency to any Class of Certificates.
SECTION 6.03. Limitation on Liability of the Depositor, the Master Servicer
and Others.
Subject to Section 6.01, neither the Depositor, the Master Servicer, the
Special Servicer nor any of the directors, officers, employees or agents of the
Depositor or the Master Servicer or the Special Servicer shall be under any
liability to the Trust Fund or the Certificateholders 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 (or with respect to those actions that are
subject to the Special Servicer's consent, due to the denial of such consent);
provided, however, that this provision shall not protect the Depositor or the
Master Servicer or the Special Servicer or any such Person against liability
which would be imposed by reason of (i) any breach of warranty or
representation, or any expense or liability specifically required to be borne
thereby pursuant to the terms of this Agreement, with respect to such respective
party or (ii) any willful misconduct, bad faith, fraud or negligence in the
performance or disregard of duties hereunder with respect to such respective
party. The Depositor, the Master Servicer, the Special Servicer and any
director, officer, employee or agent of the Depositor, the Master Servicer or
the Special Servicer may rely in good faith on any document of any kind which,
prima facie, is properly executed and submitted by any appropriate Person
respecting any matters arising hereunder. The Depositor, the Master Servicer,
the Special Servicer and any director, officer, employee or agent of the
Depositor or the Master Servicer or the Special Servicer shall be indemnified
and held harmless by the Trust Fund against any loss, liability or expense
incurred in connection with, or relating to, this Agreement or the Certificates,
other than any loss, liability or expense (including legal fees and expenses)
(i) incurred by reason of willful misconduct, bad faith, fraud or negligence in
the performance or disregard of duties hereunder, in each case by the Person
being indemnified; or (ii) with respect to any such party, resulting from the
breach by such party of any of its representations or warranties contained
herein. Neither the Depositor nor the Master Servicer nor the Special Servicer
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
in its opinion does not expose it to any expense or liability; provided,
however, that the Depositor or the Master Servicer or the Special Servicer may
in its discretion undertake any such action related to its obligations hereunder
which it may deem necessary or desirable with respect to this Agreement and 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 Fund, and the Depositor, the Master Servicer and the
Special Servicer shall be entitled to be reimbursed therefor from the Collection
Account as provided in Section 3.06 of this Agreement.
SECTION 6.04. Limitation on Resignation of the Master Servicer or Special
Servicer.
(a) In addition to the matters provided in Sections 3.01(c) and 6.02, each
of the Master Servicer and the Special Servicer may assign its respective rights
and delegate its respective duties and obligations under this Agreement,
provided that: (i) the purchaser or transferee accepting such assignment and
delegation (A) shall be satisfactory to the Trustee and to the Depositor, (B)
shall be an established mortgage finance institution, bank or mortgage servicing
institution, organized and doing business under the laws of any state of the
United States or the District of Columbia, authorized under such laws to perform
the duties of a servicer of mortgage loans or a Person resulting from a merger,
consolidation or succession that is permitted under Section 6.02, and (C) shall
execute and deliver to the Trustee an agreement, in form and substance
reasonably satisfactory to the Trustee, which contains an assumption by such
Person of the due and punctual performance and observance of each covenant and
condition to be performed or observed by the Master Servicer or the Special
Servicer, as the case may be, under this Agreement from and after the date of
such agreement; (ii) as confirmed by a letter from each Rating Agency delivered
to the Trustee, each Rating Agency's rating or ratings of the Regular
Certificates in effect immediately prior to such assignment, sale, transfer or
delegation will not be qualified, downgraded or withdrawn as a result of such
assignment, sale, transfer or delegation; (iii) the Master Servicer or the
Special Servicer shall not be released from its obligations under this Agreement
that arose prior to the effective date of such assignment and delegation under
this Section 6.04; and (iv) the rate at which the Servicing Fee or Special
Servicing Compensation, as applicable (or any component thereof) is calculated
shall not exceed the rate then in effect. Upon acceptance of such assignment and
delegation, the purchaser or transferee shall be the successor Master Servicer
or Special Servicer, as applicable, hereunder.
(b) Except as provided in this Section 6.04, the Master Servicer and the
Special Servicer shall not resign from their respective obligations and duties
hereby imposed on them except upon determination that such duties hereunder are
no longer permissible under applicable law. Any such determination permitting
the resignation of the Master Servicer or the Special Servicer, as applicable,
shall be evidenced by an Opinion of Counsel (obtained at the resigning Master
Servicer's or Special Servicer's expense) to such effect delivered to the
Trustee.
No resignation or removal of the Master Servicer or the Special Servicer as
contemplated herein shall become effective until the Trustee or a successor
Master Servicer or Special Servicer shall have assumed the Master Servicer's or
the Special Servicer's responsibilities, duties, liabilities and obligations
hereunder. If no successor Master Servicer or Special Servicer can be obtained
to perform such obligations for the same compensation to which the terminated
Master Servicer or Special Servicer would have been entitled, additional amounts
payable to such successor Master Servicer or Special Servicer shall be treated
as Realized Losses.
Notwithstanding the foregoing, if the Master Servicer acquires any
Affiliate Loan, the Master Servicer shall promptly resign as Master Servicer
hereunder in accordance with this Section 6.04, and if the Master Servicer fails
to promptly resign, the Trustee shall terminate the Master Servicer with respect
to such Mortgage Loan, in accordance with the provisions set forth in Section
7.01 and Section 7.02.
SECTION 6.05. Rights of the Depositor and the Trustee in Respect of the
Master Servicer and Special Servicer.
The Master Servicer and the Special Servicer shall afford the Depositor,
the Trustee and the Rating Agencies, 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 its officers responsible for such
obligations. Upon request, the Master Servicer and the Special Servicer shall
furnish to the Depositor and the Trustee its most recent annual financial
statements and such other information in its possession regarding its business,
affairs, property and condition, financial or otherwise as the party requesting
such information, in its reasonable judgment, determines to be relevant to the
performance of the obligations hereunder of the Master Servicer and the Special
Servicer; provided that such requesting party may not disclose the contents of
such financial statements to non-affiliated third parties (other than
accountants, attorneys, financial advisors or other third parties retained by
such requesting party) unless otherwise required by applicable law. The
Depositor may, but is not obligated to, enforce the obligations of the Master
Servicer or the Special Servicer hereunder which are in default and may, but is
not obligated to, perform, or cause a designee to perform, any defaulted
obligation of such Person hereunder or exercise its rights hereunder, provided
that the Master Servicer and the Special Servicer shall not be relieved of any
of their obligations hereunder by virtue of such performance by the Depositor or
its designee. In the event the Depositor or its designee undertakes any such
action it will be reimbursed by the Trust Fund from the Collection Account as
provided in Section 3.06 and Section 6.03 hereof to the extent not recoverable
from the Master Servicer or Special Servicer, as applicable. Neither the
Depositor nor the Trustee and neither the Master Servicer, with respect to the
Special Servicer, nor the Special Servicer, with respect to the Master Servicer,
shall have any responsibility or liability for any action or failure to act by
the Master Servicer or the Special Servicer and neither such Person is obligated
to monitor or supervise the performance of the Master Servicer or the Special
Servicer under this Agreement or otherwise.
Neither the Master Servicer nor the Special Servicer shall be under any
obligation to disclose confidential or proprietary information pursuant to this
Section.
SECTION 6.06. Master Servicer or Special Servicer as Owner of a
Certificate.
The Master Servicer or an Affiliate of the Master Servicer or the Special
Servicer or an Affiliate of the Special Servicer may become the Holder (or with
respect to a Global Certificate, Beneficial Owner) of any Certificate with the
same rights it would have if it were not the Master Servicer or the Special
Servicer or an Affiliate thereof, except as otherwise expressly provided herein.
If, at any time during which the Master Servicer or the Special Servicer or an
Affiliate of the Master Servicer or the Special Servicer is the Holder or
Beneficial Owner of any Certificate, the Master Servicer or the Special Servicer
proposes to take action (including for this purpose, omitting to take action)
that (i) is not expressly prohibited by the terms hereof and would not, in the
Master Servicer's or the Special Servicer's good faith judgment, violate the
Servicing Standard, and (ii) if taken, might nonetheless, in the Master
Servicer's or the Special Servicer's good faith judgment, be considered by other
Persons to violate the Servicing Standard, the Master Servicer or the Special
Servicer may seek the approval of the Certificateholders to such action by
delivering to the Trustee a written notice that (i) states that it is delivered
pursuant to this Section 6.06, (ii) identifies the Percentage Interest in each
Class of Certificates beneficially owned by the Master Servicer or the Special
Servicer or an Affiliate of the Master Servicer or the Special Servicer, and
(iii) describes in reasonable detail the action that the Master Servicer or the
Special Servicer proposes to take. The Trustee, upon receipt of such notice,
shall forward it to the Certificateholders (other than the Master Servicer and
its Affiliates or the Special Servicer and its Affiliates, as appropriate)
together with such instructions for response as the Trustee shall reasonably
determine. 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 Master Servicer or its Affiliates or the
Special Servicer or its Affiliates) shall have consented in writing to the
proposal described in the written notice, and if the Master Servicer or the
Special Servicer 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 Master Servicer or the Special Servicer, as
applicable, of the reasonable expenses of the Trustee incurred pursuant to this
paragraph. It is not the intent of the foregoing provision that the Master
Servicer or the Special Servicer be permitted to invoke the procedure set forth
herein with respect to routine servicing matters arising hereunder, except in
the case of unusual circumstances.
<PAGE>
ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default.
(a) "Master Servicer Event of Default", wherever used herein, means any one
of the following events:
(i) any failure by the Master Servicer to remit to the
Collection Account or any failure by the Master Servicer to
remit to the Trustee for deposit into the Lower-Tier
Distribution Account, Deferred Interest Distribution Account
or the Class Q Distribution Account, any amount required to
be so remitted by the Master Servicer (including a P&I
Advance) pursuant to, and at the time specified by the terms
of this Agreement, which failure is not remedied by 11:00
a.m., New York City time, on the related Distribution Date
(provided, however, that the Master Servicer will pay the
Trust Fund interest on such late payment at the Advance Rate
from and including the related Distribution Date until such
late payment is received by the Trustee);
(ii) any failure on the part of the Master Servicer duly to
observe or perform in any material respect any of its other
covenants or agreements, or the material breach of its
representations or warranties on the part of the Master
Servicer contained in this Agreement, which continues
unremedied for a period of 30 days after the date on which
written notice of such failure or breach, requiring the same
to be remedied, shall have been given to the Master Servicer
by the Depositor or the Trustee, or to the Master Servicer,
the Depositor and the Trustee by the Holders of Certificates
evidencing Percentage Interests of at least 25% of any Class
affected thereby; provided that if such default is not
capable of being cured within such 30 day period and the
Master Servicer is diligently pursuing such cure, the Master
Servicer shall be entitled to an additional 30 day period;
provided further that the failure of the Master Servicer to
perform any covenant or agreement contained herein (other
than as provided in clause (i) above) as a result of an
inconsistency between this Agreement and any Loan Document
shall not be a Master Servicer Event of Default hereunder;
(iii) confirmation in writing by any Rating Agency that not
terminating the Master Servicer would, in and of itself,
cause the then-current rating assigned to any Class of
Certificates to be qualified, withdrawn, or downgraded;
(iv) 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 or receiver or liquidator in
any insolvency, readjustment of debt, marshaling of assets
and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been
entered against the Master Servicer and such decree or order
shall have remained in force undischarged or unstayed for a
period of 60 days;
(v) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities
or similar proceedings of or relating to the Master
Servicer, or of or relating to all or substantially all of
its property;
(vi) the Master Servicer shall admit in writing its inability to
pay its debts generally as they become due, file a petition
to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit
of its creditors, or voluntarily suspend payment of its
obligations; or
(vii) the Master Servicer shall fail to make any Property Advance
required to be made by the Master Servicer hereunder
(whether or not the Trustee makes such Property Advance),
which failure continues unremedied for a period of fifteen
(15) days after the date on which such Advance was first due
(or for any shorter period as may be required, if
applicable, to avoid any lapse in insurance coverage
required under any Mortgage or this Agreement with respect
to any Mortgaged Property or to avoid any foreclosure or
similar action with respect to any Mortgaged Property by
reason of a failure to pay real estate taxes and
assessments); provided, however, that in the event the
Trustee makes a required Property Advance pursuant to
Section 3.22(b) due to the Master Servicer's failure to make
a required Property Advance, such Event of Default shall
occur immediately upon the making of such Property Advance
by the Trustee;
then, and in each and every such case, so long as a Master Servicer Event of
Default shall not have been remedied, the Trustee may, and at the written
direction of the Holders of at least 25% of the aggregate Voting Rights of all
Certificates shall, terminate the Master Servicer.
In the event that the Master Servicer is also the Special Servicer and the
Master Servicer is terminated as provided in this Section 7.01, the Master
Servicer shall also be terminated as Special Servicer.
(b) "Special Servicer Event of Default", wherever used herein, means any
one of the following events:
(i) any failure by the Special Servicer to remit to the
Collection Account any amount required to be so deposited by
the Special Servicer pursuant to, and at the time specified,
and in accordance with the terms of this Agreement;
(ii) any failure on the part of the Special Servicer duly to
observe or perform in any material respect any other of the
covenants or agreements, or the material breach of any
representations or warranties on the part of the Special
Servicer contained in this Agreement, which continues
unremedied for a period of 30 days after the date on which
written notice of such failure or breach, requiring the same
to be remedied, shall have been given to the Special
Servicer by the Master Servicer, the Depositor, the Trustee
or by the Holders of Certificates evidencing Percentage
Interests of at least 25% of any Class affected thereby;
(iii) confirmation in writing by any Rating Agency that failure to
remove the Special Servicer would, in and of itself, cause a
downgrade, qualification or withdrawal of the then current
ratings assigned to any Class of Certificates;
(iv) 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 or receiver or liquidator in
any insolvency, readjustment of debt, marshaling of assets
and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been
entered against the Special Servicer and such decree or
order shall have remained in force undischarged or unstayed
for a period of 60 days;
(v) the Special Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities
or similar proceedings of or relating to the Special
Servicer, or of or relating to all or substantially all of
its property; or
(vi) the Special Servicer shall admit in writing its inability to
pay its debts generally as they become due, file a petition
to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit
of its creditors, or voluntarily suspend payment of its
obligations;
then, and in each and every such case, so long as a Special Servicer Event of
Default shall not have been remedied, the Trustee may, and at the written
direction of the Holders of at least 25% of the aggregate Voting Rights of all
Certificates shall, terminate the Special Servicer.
(c) In the event that the Master Servicer or the Special Servicer is
terminated pursuant to this Section 7.01, the Trustee shall, by notice in
writing to the Master Servicer or the Special Servicer, as the case may be (the
"Terminated Party"), terminate all of its rights and obligations (but not the
liabilities for actions and omissions occurring prior hereto) of the Terminated
Party under this Agreement and in and to the Mortgage Loans and the proceeds
thereof, other than any rights the Terminated Party may have hereunder as a
Certificateholder and any rights or obligations that accrued prior to the date
of such termination (including the right to receive all amounts accrued or owing
to it under this Agreement, plus interest at the Advance Rate on such amounts
until received to the extent such amounts bear interest as provided in this
Agreement, with respect to periods prior to the date of such termination and the
right to the benefits of Section 6.03 notwithstanding any such termination). On
or after the receipt by the Terminated Party of such written notice, all of its
authority and power under this Agreement, whether with respect to the
Certificates (except that the Terminated Party shall retain its rights as a
Certificateholder in the event and to the extent that it is a Certificateholder)
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 Terminated 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. The Master Servicer and
the Special Servicer each agrees that, in the event it is terminated pursuant to
this Section 7.01, it shall promptly (and in any event no later than ten
Business Days subsequent to such notice) provide, at its own expense, the
Trustee or a successor Master Servicer or successor Special Servicer, as
applicable, with all documents and records requested by the Trustee or such
successor Master Servicer or successor Special Servicer, as applicable, to
enable the Trustee or such successor Master Servicer or successor Special
Servicer, as applicable, to assume its functions hereunder, and to cooperate
with the Trustee and the successor to its responsibilities hereunder in
effecting the termination of its responsibilities and rights hereunder,
including, without limitation, the transfer to the successor Master Servicer or
successor Special Servicer or the Trustee, as applicable, for administration by
it of all cash amounts which shall at the time be or should have been credited
by the Master Servicer or the Special Servicer to the Collection Account, any
REO Account or Lock-Box Account or shall thereafter be received with respect to
the Mortgage Loans, and shall promptly provide the Trustee or such successor
Master Servicer or Special Servicer (which may include the Trustee), as
applicable, all documents and records reasonably requested by it, such documents
and records to be provided in such form as the Trustee or such successor Master
Servicer or Special Servicer shall reasonably request (including electromagnetic
form), to enable it to assume the Master Servicer's or Special Servicer's
function hereunder. All reasonable costs and expenses of the Trustee or the
successor Master Servicer or successor Special Servicer incurred in connection
with transferring the Mortgage Files to the successor Master Servicer or Special
Servicer and amending this Agreement to reflect such succession as successor
Master Servicer or successor Special Servicer pursuant to this Section 7.01
shall be paid by the predecessor Master Servicer or the Special Servicer, as
applicable, upon presentation of reasonable documentation of such costs and
expenses. If the predecessor Master Servicer or Special Servicer (as the case
may be) has not reimbursed the Trustee or the successor Master Servicer or
Special Servicer for such expenses within 90 days after the presentation of
reasonable documentation, such expense shall be reimbursed by the Trust Fund;
provided that the Terminated Party shall not thereby be relieved of its
liability for such expenses.
SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer or the Special Servicer receives
a notice of termination pursuant to Section 7.01, the Trustee shall be its
successor in all respects in its capacity as Master Servicer or Special Servicer
under this Agreement and the transactions set forth or provided for herein and,
except as provided herein, shall be subject to all the responsibilities, duties,
limitations on liability and liabilities relating thereto and arising thereafter
placed on the Master Servicer or Special Servicer by the terms and provisions
hereof; provided, however, that (i) the Trustee shall have no responsibilities,
duties, liabilities or obligations with respect to any act or omission of the
Master Servicer or Special Servicer and (ii) any failure to perform, or delay in
performing, such duties or responsibilities caused by the Terminated Party's
failure to provide, or delay in providing, records, tapes, disks, information or
monies shall not be considered a default by such successor hereunder. The
Trustee, as successor Master Servicer or successor Special Servicer, shall have
the same right to indemnification as the Master Servicer or Special Servicer, as
applicable, had under this Agreement prior to the Master Servicer's or the
Special Servicer's termination. The appointment of a successor Master Servicer
or successor Special Servicer shall not affect any liability of the predecessor
Master Servicer or Special Servicer which may have arisen prior to its
termination as Master Servicer or Special Servicer. The Trustee shall not be
liable for any of the representations and warranties of the Master Servicer or
Special Servicer herein or in any related document or agreement, for any acts or
omissions of the predecessor Master Servicer or predecessor Special Servicer or
for any losses incurred in respect of any Permitted Investment by the Master
Servicer pursuant to Section 3.07 hereunder nor shall the Trustee be required to
purchase any Mortgage Loan hereunder. As compensation therefor, the Trustee as
successor Master Servicer or successor Special Servicer shall be entitled to the
Servicing Fee or Special Servicing Compensation, as applicable, and all funds
relating to the Mortgage Loans that accrue after the date of the Trustee's
succession to which the Master Servicer or Special Servicer would have been
entitled if the Master Servicer or Special Servicer, as applicable, had
continued to act hereunder. In the event any Advances made by the Master
Servicer, the Special Servicer and the Trustee shall at any time be outstanding,
or any amounts of interest thereon shall be accrued and unpaid, all amounts
available to repay Advances and interest hereunder shall be applied entirely to
the Advances made by the Trustee (and the accrued and unpaid interest thereon),
until such Advances and interest shall have been repaid in full. Notwithstanding
the above, the Trustee may, if it shall be unwilling to so act, or shall, if it
is unable to so act, or if the Holders of Certificates entitled to at least 25%
of the aggregate Voting Rights so request in writing to the Trustee, or if the
Trustee is not rated by each Rating Agency in one of its two highest long-term
debt rating categories or if the Rating Agencies do not provide written
confirmation that the succession of the Trustee, as Master Servicer or Special
Servicer, as applicable, will not cause a downgrade, qualification or withdrawal
of the then current ratings assigned to the Certificates, promptly appoint, or
petition a court of competent jurisdiction to appoint, any established mortgage
loan servicing institution, the appointment of which will not result in a
downgrade, qualification or withdrawal of the then current rating or ratings
assigned to any Class of Certificates as evidenced in writing by each Rating
Agency, as the successor to the Master Servicer or Special Servicer, as
applicable, hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer or Special
Servicer hereunder. No appointment of a successor to the Master Servicer or
Special Servicer hereunder shall be effective until the assumption by such
successor of all the Master Servicer's or Special Servicer's responsibilities,
duties and liabilities hereunder. Pending appointment of a successor to the
Master Servicer (or the Special Servicer if the Special Servicer is also the
Master Servicer) hereunder, unless the Trustee shall be prohibited by law from
so acting, the Trustee shall act in such capacity as herein above provided.
Pending the appointment of a successor to the Special Servicer, the Trustee
shall act in such capacity as provided in this Section 7.02. In connection with
such appointment and assumption described herein, the Trustee may make such
arrangements for the compensation of such successor out of payments on Mortgage
Loans as it and such successor shall agree; provided, however, that no such
compensation shall be in excess of that permitted the Terminated Party
hereunder, provided, further, that if no successor to the Terminated Party can
be obtained to perform the obligations of such Terminated Party hereunder,
additional amounts shall be paid to such successor and such amounts in excess of
that permitted the Terminated Party shall be treated as Realized Losses. The
Depositor, the Trustee, the Master Servicer or Special Servicer and such
successor 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 termination pursuant to Section 7.01 above or appointment of a
successor to the Master Servicer or the Special Servicer, the Trustee shall give
prompt written notice thereof to Certificateholders at their respective
addresses appearing in the Certificate Register and to each Rating Agency.
(b) Within 30 days after the occurrence of any Event of Default of which a
Responsible Officer of the Trustee has actual knowledge, the Trustee shall
transmit by mail to all Holders of Certificates and to each Rating Agency notice
of such Event of Default, unless such Event of Default shall have been cured or
waived.
SECTION 7.04. Other Remedies of Trustee.
During the continuance of any Master Servicer Event of Default or a Special
Servicer Event of Default when the Master Servicer is also serving as Special
Servicer, so long as such Master Servicer Event of Default or Special Servicer
Event of Default, if applicable, shall not have been remedied, the Trustee, in
addition to the rights specified in Section 7.01, shall have the right, in its
own name 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 filing of proofs of claim and debt
in connection therewith). In such event, the legal fees, expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund, and the Trustee shall be entitled to be
reimbursed therefor from the Collection Account as provided in Section 3.06.
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 Master Servicer Event of Default or
Special Servicer Event of Default, if applicable.
SECTION 7.05. Waiver of Past Events of Default; Termination.
The Holders of Certificates (other than the Master Servicer or the Special
Servicer, as applicable) evidencing not less than 66-2/3% of the aggregate
Voting Rights of the Certificates (exclusive of such Certificates held by the
Master Servicer or the Special Servicer) may, on behalf of all Holders of
Certificates, waive any default by the Master Servicer or Special Servicer in
the performance of its obligations hereunder and its consequences, except a
default in making any required deposits (including P&I Advances) to or payments
from the Collection Account or the Lower-Tier Distribution Account or in
remitting payments as received, in each case in accordance with this Agreement.
Upon any such waiver of a past default, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereon. Any reasonable costs
and expenses incurred by the Trustee in connection with such default and prior
to such waiver shall be reimbursed by the Master Servicer or the Special
Servicer, as applicable, promptly upon demand therefor and if not reimbursed to
the Trustee within 90 days of such demand, from the Trust Fund; provided, that
the Trust Fund shall be reimbursed by the Master Servicer or the Special
Servicer, as applicable, to the extent such amounts are reimbursed to the
Trustee from the Trust Fund.
<PAGE>
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge 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
and no permissive right of the Trustee shall be construed as a duty. During the
continuance of an Event of Default of which a Responsible Officer of the Trustee
has actual knowledge, the Trustee, subject to the provisions of Sections 7.02
and 7.04, 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 person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) The Trustee, upon receipt of any 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, shall examine them to determine whether they
conform on their face to the requirements of this Agreement to the extent
specifically set forth herein; provided, however, that, the Trustee shall not be
responsible for the accuracy or content of any such resolution, certificate,
statement, opinion, report, document, order or other instrument provided to it
hereunder. If any such instrument is found not to conform on its face to the
requirements of this Agreement in a material manner, the Trustee shall request a
corrected instrument, and if the instrument is not corrected to the Trustee's
reasonable satisfaction, the Trustee will provide notice thereof to the
Certificateholders.
(c) Neither the Trustee nor any of its officers, directors, employees,
agents or "control" persons within the meaning of the Act shall have any
liability arising out of or in connection with this Agreement, provided, that,
subject to Section 8.02, no provision of this Agreement shall be construed to
relieve the Trustee, or any such person, from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct or its
own bad faith; and provided, further, that:
(i) Prior to the occurrence of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge, and
after the curing or waiver of all such 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 resolutions,
certificates, statements, reports, opinions, documents,
orders or other instruments furnished to the Trustee that
conform on their face to the requirements of this Agreement
without responsibility for investigating the contents
thereof;
(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or
Responsible Officers, 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 greater than 50% of the Percentage
Interests (or such other percentage as is specified herein)
of each affected Class, or of the aggregate Voting Rights of
the Certificates, relating to the time, 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) Neither the Trustee nor any of its respective directors,
officers, employees, agents or control persons shall be
responsible for any act or omission of any Custodian, Paying
Agent or Certificate Registrar that is not an Affiliate of
the Trustee and that is selected other than by the Trustee,
performed or omitted in compliance with any custodial or
other agreement, or any act or omission of the Master
Servicer, Special Servicer, the Depositor or any other third
Person, including, without limitation, in connection with
actions taken pursuant to this Agreement;
(v) The Trustee shall not be under any obligation to appear in,
prosecute or defend any legal action which is not incidental
to its respective duties as Trustee in accordance with this
Agreement (and, if it does, all legal expenses and costs of
such action shall be expenses and costs of the Trust Fund),
and the Trustee shall be entitled to be reimbursed therefor
from the Collection Account, unless such legal action arises
out of the negligence or bad faith of the Trustee or any
breach of an obligation, representation, warranty or
covenant of the Trustee contained herein; and
(vi) The Trustee shall not be charged with knowledge of any act,
failure to act or breach of any Person upon the occurrence
of which the Trustee may be required to act, unless a
Responsible Officer of the Trustee obtains actual knowledge
of such failure. The Trustee shall be deemed to have actual
knowledge of the Master Servicer's or the Special Servicer's
failure to provide scheduled reports, certificates and
statements when and as required to be delivered to the
Trustee pursuant to this Agreement.
None of the provisions contained in this Agreement shall require either the
Trustee, in its capacity as Trustee, to expend or risk its own funds, or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if in the opinion
of the Trustee the repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it, and none of the provisions
contained in this Agreement shall in any event require the Trustee to perform,
or be responsible for the manner of performance of, any of the obligations of
the Master Servicer or the Special Servicer under this Agreement, except during
such time, if any, as the Trustee shall be the successor to, and be vested with
the rights, duties, powers and privileges of, the Master Servicer or the Special
Servicer in accordance with the terms of this Agreement. The Trustee shall not
be required to post any surety or bond of any kind in connection with its
performance of its obligations under this Agreement and the Trustee shall not be
liable for any loss on any investment of funds pursuant to this Agreement (other
than any funds invested with it in its commercial capacity).
SECTION 8.02. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) The Trustee may request and/or rely upon and shall be
protected in acting or refraining from acting upon any
resolution, Officers' Certificate, certificate of auditors
or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, appraisal;
(ii) The Trustee may consult with counsel and 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 with
such Opinion of Counsel;
(iii) (A) The Trustee shall be under no obligation 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 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; (B) the right of the Trustee to perform
any discretionary act enumerated in this Agreement shall not
be construed as a duty, and the Trustee shall not be
answerable for other than its negligence or willful
misconduct in the performance of any such act; and (C)
provided, that subject to the foregoing clause (A), nothing
contained herein shall relieve the Trustee of the
obligations, upon the occurrence of an Event of Default
(which has not been cured or waived) of which a Responsible
Officer of the Trustee has actual knowledge, 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 person would exercise or use
under the circumstances in the conduct of such person's own
affairs;
(iv) Neither the Trustee nor any of its directors, officers,
employees, Affiliates, agents or "control" persons within
the meaning of the Act shall be personally liable for any
action taken, suffered or omitted by it in good faith and
reasonably believed by the Trustee to be authorized or
within the discretion or rights or powers conferred upon it
by this Agreement;
(v) 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% (or such other
percentage as is specified herein) of the Percentage
Interests of any affected Class; 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. The reasonable expense of every such investigation
shall be paid by the Master Servicer or the Special
Servicer, as applicable, if an Event of Default shall have
occurred and be continuing relating to the Master Servicer,
or the Special Servicer, respectively, and otherwise by the
Certificateholders requesting the investigation; and
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or
by or through agents or attorneys but shall not be relieved
of its obligations hereunder.
(b) Following the Start-up Day, the Trustee shall not, except as expressly
required by any provision of this Agreement, accept any contribution of assets
to the Trust Fund unless the Trustee shall have received an Opinion of Counsel
(the costs of obtaining such opinion to be borne by the Person requesting such
contribution) to the effect that the inclusion of such assets in the Trust Fund
will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to fail to
qualify as a REMIC at any time that any Certificates are outstanding or subject
either the Upper-Tier REMIC or the Lower-Tier REMIC to any tax under the REMIC
Provisions or other applicable provisions of federal, state and local law or
ordinances.
(c) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.
The Trustee shall have no duty to conduct any affirmative investigation as
to the occurrence of any condition requiring the repurchase of any Mortgage Loan
by the Depositor pursuant to this Agreement or the eligibility of any Mortgage
Loan for purposes of this Agreement.
SECTION 8.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall not be taken as
the statements of the Trustee, the Master Servicer, or the Special Servicer, and
the Trustee, the Master Servicer and Special Servicer assume no responsibility
for their correctness. The Trustee, the Master Servicer and Special Servicer
make no representations or warranties as to the validity or sufficiency of this
Agreement, of the Certificates or any prospectus used to offer the Certificates
for sale or the validity, enforceability or sufficiency of any Mortgage Loan or
related document. The Trustee shall not at any time have any responsibility or
liability for or with respect to the legality, validity and enforceability of
any Mortgage, any Mortgage Loan, or the perfection and priority of any Mortgage
or the maintenance of any such perfection and priority, or for or with respect
to the sufficiency of the Trust Fund or its ability to generate the payments to
be distributed to Certificateholders under this Agreement. Without limiting the
foregoing, the Trustee shall not be liable or responsible for: the existence,
condition and ownership of any Mortgaged Property; the existence of any hazard
or other insurance thereon (other than if the Trustee shall assume the duties of
the Master Servicer or the Special Servicer pursuant to Section 7.02) or the
enforceability thereof; the existence of any Mortgage Loan or the contents of
the related Mortgage File on any computer or other record thereof (other than if
the Trustee shall assume the duties of the Master Servicer or the Special
Servicer pursuant to Section 7.02); the validity of the assignment of any
Mortgage Loan to the Trust Fund or of any intervening assignment; the
completeness of any Mortgage File (except for its review thereof pursuant to
Section 2.02); the performance or enforcement of any Mortgage Loan (other than
if the Trustee shall assume the duties of the Master Servicer or the Special
Servicer pursuant to Section 7.02); the compliance by the Depositor, the Master
Servicer or the Special Servicer with any warranty or representation made under
this Agreement or in any related document or the accuracy of any such warranty
or representation prior to the Trustee's receipt of notice or other discovery of
any non-compliance therewith or any breach thereof; any investment of monies by
or at the direction of the Master Servicer or any loss resulting therefrom
(other than if the Trustee shall assume the duties of the Master Servicer or the
Special Servicer pursuant to Section 7.02), it being understood that the Trustee
shall remain responsible for any Trust Fund property that it may hold in its
individual capacity; the acts or omissions of any of the Depositor, the Master
Servicer or the Special Servicer (other than if the Trustee shall assume the
duties of the Master Servicer or Special Servicer pursuant to Section 7.02) or
any sub-Master Servicer or any Borrower; any action of the Master Servicer or
Special Servicer (other than if the Trustee shall assume the duties of the
Master Servicer or the Special Servicer pursuant to Section 7.02) or any
sub-Master Servicer taken in the name of the Trustee, except to the extent such
action is taken at the express written direction of the Trustee; the failure of
the Master Servicer or the Special Servicer or any sub-Master Servicer to act or
perform any duties required of it on behalf of the Trust Fund or the Trustee
hereunder; or any action by or omission of the Trustee taken at the instruction
of the Master Servicer or the Special Servicer (other than if the Trustee shall
assume the duties of the Master Servicer or the Special Servicer pursuant to
Section 7.02) unless the taking of such action is not permitted by the express
terms of this Agreement; provided, however, that the foregoing shall not relieve
the Trustee of its obligation to perform its duties as specifically set forth in
this Agreement. The Trustee shall not be accountable for the use or application
by the Depositor, the Master Servicer or the Special Servicer of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor, the Master Servicer or the
Special Servicer in respect of the assignment of the Mortgage Loans or deposited
in or withdrawn from the Collection Account, Lower-Tier Distribution Account,
Upper-Tier Distribution Account, Class Q Distribution Account, Deferred Interest
Distribution Account, Lock Box Account, Cash Collateral Account, Reserve
Accounts or any other account maintained by or on behalf of the Master Servicer
or the Special Servicer, other than any funds held by the Trustee. Except as
provided in Section 2.01, the Trustee shall not have 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 (unless the Trustee shall have become the successor
Master Servicer) or to record this Agreement. In making any calculation
hereunder which includes as a component thereof the payment or distribution of
interest for a stated period at a stated rate "to the extent permitted by
applicable law," the Trustee shall assume that such payment is so permitted
unless a Responsible Officer of the Trustee has actual knowledge, or receives an
Opinion of Counsel (at the expense of the Person asserting the impermissibility)
to the effect that such payment is not permitted by applicable law.
The Trustee and the Certificate Registrar shall have no liability for
transfers made through the book-entry facilities of the Depository or between or
among Depository Participants or beneficial owners of the Certificates, made in
violation of applicable restrictions.
SECTION 8.04. Trustee May Own Certificates.
The Trustee and the Certificate Registrar shall have no liability for
transfers, including transfers made through the book-entry facilities of the
Depository or between or among Depository Participants or beneficial owners of
the Certificates, made in violation of applicable restrictions. The Trustee and
any agent of the Trustee in its individual capacity or any other capacity may
become the owner or pledgee of Certificates, and may deal with the Depositor and
the Master Servicer in banking transactions, with the same rights it would have
if it were not Trustee or such agent.
SECTION 8.05. Payment of Trustee Fees and Expenses; Indemnification.
(a) The Trustee or any successor Trustee shall be entitled, on each
Distribution Date, to the Trustee Fee (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
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
hereunder of the Trustee, which Trustee Fee shall be paid to the Trustee prior
to the distribution on such Distribution Date of amounts to the
Certificateholders. In the event that the Trustee assumes the servicing
responsibilities of the Master Servicer or the Special Servicer hereunder
pursuant to or otherwise arising from the resignation or removal of the Master
Servicer or the Special Servicer, the Trustee shall be entitled to the
compensation to which the Master Servicer or the Special Servicer, as the case
may be, would have been entitled.
(b) The Trustee shall be paid or reimbursed by the Trust Fund upon its
request for all reasonable expenses, disbursements and advances incurred or made
by the Trustee pursuant to and in accordance with any of the provisions of this
Agreement (including the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its employ) to
the extent such payments are "unanticipated expenses" as described in clause (d)
below, except any such expense, disbursement or advance as may arise from its
negligence or bad faith; provided, however, that, subject to the last paragraph
of Section 8.01, the Trustee shall not refuse to perform any of its duties
hereunder solely as a result of the failure to be paid the Trustee Fee and the
Trustee's expenses.
The Master Servicer and the Special Servicer covenant and agree to pay or
reimburse the Trustee for the reasonable out-of-pocket expenses incurred or made
by the Trustee in connection with any transfer of the servicing responsibilities
of the Master Servicer or the Special Servicer, respectively, hereunder,
pursuant to or otherwise arising from the resignation or removal of the Master
Servicer or the Special Servicer, in accordance with any of the provisions of
this Agreement (and including the reasonable fees and expenses and disbursements
of its counsel and all other persons not regularly in its employ), except any
such expense, disbursement or advance as may arise from the negligence or bad
faith of the Trustee.
(c) Each of the Paying Agent, the Certificate Registrar, the Custodian, the
Depositor, the Master Servicer and the Special Servicer (each, an "Indemnifying
Party") shall indemnify the Trustee and its Affiliates and each of the
directors, officers, employees and agents of the Trustee and its Affiliates
(each, an "Indemnified Party"), and hold each of them harmless against any and
all claims, losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments, and any other costs, fees and
expenses that the Indemnified Party may sustain in connection with this
Agreement (including, without limitation, reasonable fees and disbursements of
counsel incurred by the Indemnified Party in any action or proceeding between
the Indemnifying Party and the Indemnified Party or between the Indemnified
Party and any third party or otherwise) related to each such Indemnifying
Party's respective willful misconduct, bad faith, fraud and/or negligence in the
performance of each of its respective duties hereunder or by reason of reckless
disregard of its respective obligations and duties hereunder (including in the
case of the Master Servicer, any agent of the Master Servicer or subservicer of
the Master Servicer).
(d) The Trust Fund shall indemnify each Indemnified Party from, and hold it
harmless against, any and all losses, liabilities, damages, claims or
unanticipated expenses (including, without limitation, reasonable fees and
disbursements of counsel incurred by the Indemnified Party in any action or
proceeding between the Indemnifying Party and the Indemnified Party or between
the Indemnified Party and any third party or otherwise) arising in respect of
this Agreement or the Certificates, in each case to the extent and only to the
extent, such payments are expressly reimbursable under this Agreement, or are
unanticipated expenses (as defined below), other than (i) those resulting from
the negligence, fraud, bad faith or willful misconduct of the Indemnified Party
and (ii) those as to which such Indemnified Party is entitled to indemnification
pursuant to Section 8.05(c). The term "unanticipated expenses" shall include, by
way of example, any fees, expenses and disbursement of any separate trustee or
co-trustee appointed hereunder, only to the extent such fees, expenses and
disbursements were not reasonably anticipated as of the Closing Date, and the
losses, liabilities, damages, claims or incremental expenses (including
reasonable attorneys' fees) incurred or advanced by an Indemnified Party in
connection with (i) a default under any Mortgage Loan and (ii) any litigation
arising out of this Agreement, including, without limitation, under Section
2.03, Section 3.10, the third paragraph of Section 3.11, Section 4.05 and
Section 7.01. The right of reimbursement of the Indemnified Parties under this
Section 8.05(d) shall be senior to the rights of all Certificateholders.
(e) Notwithstanding anything herein to the contrary, this Section 8.05
shall survive the termination or maturity of this Agreement or the resignation
or removal of the Trustee as regards rights accrued prior to such resignation or
removal and (with respect to any acts or omissions during their respective
tenures) the resignation, removal or termination of the Master Servicer, the
Special Servicer, the Paying Agent, the Certificate Registrar or the Custodian.
(f) This Section 8.05 shall be expressly construed to include, but not be
limited to, such indemnities, compensation, expenses, disbursements, advances,
losses, liabilities, damages and the like, as may pertain or relate to any
environmental law or environmental matter.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or association
organized and doing business under the laws of any state or the United States of
America, authorized under such laws to exercise corporate trust powers and to
accept the trust conferred under this Agreement, having a combined capital and
surplus of at least $50,000,000 and a rating on its unsecured long-term debt of
at least "AA" by Fitch and S&P and subject to supervision or examination by
federal or state authority and shall not be an Affiliate of the Master Servicer
(except during any period when the Trustee has assumed the duties of the Master
Servicer pursuant to Section 7.02). If a corporation or association publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for purposes of this
Section the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. In the event that the place of business from which the
Trustee administers the Trust Fund is a state or local jurisdiction that imposes
a tax on the Trust Fund or the net income of a REMIC (other than a tax
corresponding to a tax imposed under the REMIC Provisions) the Trustee shall
elect either to (i) resign immediately in the manner and with the effect
specified in Section 8.07, (ii) pay such tax from its own funds and continue as
Trustee or (iii) administer the Trust Fund from a state and local jurisdiction
that does not impose such a tax. In case at any time the Trustee shall cease to
be eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section 8.07.
SECTION 8.07. Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the trusts hereby
created by giving written notice thereof to the Depositor, the Master Servicer
and each Rating Agency. Upon such notice of resignation the Depositor shall
promptly appoint a successor Trustee, the appointment of which would not, as
evidenced in writing from each of the Rating Agencies, in and of itself, result
in a downgrade, qualification or withdrawal of the then current ratings assigned
to the Certificates. 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.
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 Master 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 upon
a confirmation in writing by any Rating Agency that not terminating the Trustee
would, in and of itself, cause the then-current rating assigned to any Class of
Certificates to be qualified, withdrawn or downgraded, then the Depositor may
remove the Trustee and promptly appoint a successor Trustee by written
instrument, which shall be delivered to the Trustee so removed and to the
successor Trustee. The Holders of Certificates entitled to at least 50% of the
Voting Rights of all of the Certificates may at any time remove the Trustee and
appoint a successor Trustee by written instrument or instruments, in seven
originals, 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 Master Servicer, one complete set to the Trustee so removed,
one complete set to the successor Trustee so appointed; provided, however, that
the fee paid to the successor Trustee shall in no event be greater than the
Trustee Fee. All expenses incurred by the Trustee upon any removal without cause
shall be paid by the party(ies) terminating the Trustee. Such termination shall
not be effective until such expenses have been paid.
In the event that the Trustee is terminated or removed pursuant to this
Section 8.07, all of its rights and obligations under this Agreement and in and
to the Mortgage Loans shall be terminated, other than any rights or obligations
that accrued prior to the date of such termination or removal (including the
right to receive all fees, expenses and other amounts accrued or owing to it
under this Agreement, plus interest at the Advance Rate on all such amounts
until received to the extent such amounts bear interest as provided in this
Agreement, with respect to periods prior to the date of such termination or
removal).
Any resignation or removal of the Trustee and appointment of a successor
Trustee shall not become effective until acceptance of appointment by the
successor Trustee as provided in Section 8.08.
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 Master Servicer and to
the predecessor Trustee instruments accepting their 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, provided that the appointment of such successor Trustee
shall not, as evidenced in writing by each Rating Agency, result in a downgrade,
qualification or withdrawal of the then current ratings assigned to the
Certificates. The predecessor Trustee shall deliver to the successor Trustee all
Mortgage Files and related documents and statements held by it hereunder, and
the Depositor and the predecessor Trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor Trustee all such
rights, powers, duties and obligations. 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.
Upon acceptance of appointment by a successor Trustee as provided in this
Section 8.08, the Depositor shall mail notice of the succession of such Trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register. If the Depositor fails to mail such notice within 10 days
after acceptance of appointment by the successor Trustee, the successor Trustee
shall cause such notice to be mailed at the expense of the Depositor.
(b) Any successor Trustee appointed pursuant to this Agreement shall
satisfy the eligibility requirements set forth in Section 8.06 hereof.
SECTION 8.09. Merger or Consolidation of Trustee.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such corporation 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.
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
Depositor 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 (at the expense of the Trustee) 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 Depositor and the Trustee may consider necessary or desirable.
If the Depositor shall not be in existence or shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or in
case an Event of Default shall have occurred and be continuing, the Trustee
alone shall have the power to make such appointment. Except as required by
applicable law, the appointment of a co-trustee or separate trustee shall not
relieve the Trustee of its responsibilities, obligations and liabilities
hereunder. No co-trustee or separate trustee hereunder shall be required to meet
the terms of eligibility as a successor Trustee under Section 8.06 hereunder 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 hereof.
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 (it
being understood that such separate trustee or co-trustee is not authorized to
act separately without the Trustee joining in such act), 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 as successor to the Master
Servicer 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 solely at the direction of the Trustee.
No trustee under this Agreement shall be personally liable by reason of any
act or omission of any other trustee under this Agreement. The Depositor and the
Trustee acting jointly may at any time accept the resignation of or remove any
separate trustee or co-trustee, or if the separate trustee or co-trustee is an
employee of the Trustee, the Trustee acting alone may accept the resignation of
or remove any separate trustee or co-trustee.
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. Every such instrument shall be filed with the Trustee.
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. In no
event shall any such separate trustee or co-trustee be entitled to any provision
relating to the conduct of, affecting the liability of, or affording protection
to, such separate trustee or co-trustee that imposes a standard of conduct less
stringent than that imposed on the Trustee hereunder, affording greater
protection than that afforded to the Trustee hereunder or providing a greater
limit on liability than that provided to the Trustee hereunder.
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.
SECTION 8.11. Representations and Warranties of the Trustee.
The Trustee hereby represents and warrants to the Depositor, the Master
Servicer and the Special Servicer and for the benefit of the Certificateholders,
as of the Closing Date, that:
(i) The Trustee is a trust company, duly organized, validly
existing and in good standing under the laws of The
Commonwealth of Massachusetts;
(ii) The execution and delivery of this Agreement by the Trustee,
and the performance and compliance with the terms of this
Agreement by the Trustee, will not violate the Trustee's
charter and by-laws 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 instrument to which it is a
party or which is applicable to it or any of its assets;
(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 national banking associations specifically 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 this Agreement and its performance and
compliance with the terms of this Agreement will not
constitute a violation of, any law (subject to the
appointment in accordance with such applicable laws of any
co-trustee or separate trustee required pursuant to this
Agreement), 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 litigation is pending or, to the best of the Trustee's
knowledge, threatened against the Trustee which would
prohibit the Trustee from entering into this Agreement or,
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; and
(vii) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution,
delivery and performance by the Trustee, or compliance by
the Trustee with, this Agreement or the consummation of the
transactions contemplated by this Agreement, except for any
consent, approval, authorization or order which has not been
obtained or cannot be obtained prior to the actual
performance by the Trustee of its obligations under this
Agreement, and which, if not obtained would not have a
materially adverse effect on the ability of the Trustee to
perform its obligations hereunder.
SECTION 8.12. Massachusetts Filings.
The Trustee shall make any filings required under Massachusetts General
Laws, Chapter 182, Sections 2 and 12, the costs of which, if any, shall be
reimbursed to it pursuant to Section 8.05.
<PAGE>
ARTICLE IX
TERMINATION; OPTIONAL MORTGAGE LOAN PURCHASE
SECTION 9.01. Termination; Optional Mortgage Loan Purchase.
(a) The respective obligations and responsibilities of the Master Servicer,
the Special Servicer, the Depositor and the Trustee created hereby with respect
to the Certificates (other than the obligation to make certain payments and to
send certain notices to Certificateholders as hereinafter set forth) shall
terminate immediately following the occurrence of the last action required to be
taken by the Trustee pursuant to this Article IX on the Termination Date;
provided, however, that in no event shall the trust created hereby continue
beyond the expiration of twenty-one years from the death of the last survivor of
the descendants of Joseph P. Kennedy, the late ambassador of the United States
to the United Kingdom, living on the date hereof.
(b) The Upper-Tier REMIC and the Lower-Tier REMIC shall be terminated and
the assets of the Trust Fund with respect to the Trust REMICs shall be sold or
otherwise disposed of in connection therewith, only pursuant to a "plan of
complete liquidation" within the meaning of Code Section 860F(a)(4)(A) providing
for the actions contemplated by the provisions hereof pursuant to which the
applicable Notice of Termination is given and requiring that the assets of each
of the Upper-Tier REMIC and the Lower-Tier REMIC shall be sold for cash and that
each such REMIC shall terminate on a Distribution Date occurring not more than
90 days following the date of adoption of the plan of complete liquidation. For
purposes of this Section 9.01(b), the Notice of Termination given pursuant to
Section 9.01(c) shall constitute the adoption of the plan of complete
liquidation as of the date such notice is given, which date shall be specified
by the Master Servicer in the final federal income tax returns of the Upper-Tier
REMIC and the Lower-Tier REMIC. Notwithstanding the termination of the REMICs or
the Trust Fund, the Trustee shall be responsible for filing the final Tax
Returns for the REMICs and applicable income tax or information returns for the
Grantor Trust for the period ending with such termination, and shall maintain
books and records with respect to the REMICs and the Grantor Trust for the
period for which it maintains its own tax returns or other reasonable period.
(c) The Depositor may effect an early termination of the Trust Fund, upon
not less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date specifying the Anticipated
Termination Date, by purchasing on such date all, but not less than all, of the
Mortgage Loans then included in the Trust Fund, and all property acquired in
respect of any Mortgage Loan, at a purchase price, payable in cash, equal to not
less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each Mortgage
Loan included in the Trust Fund as of the last day of
the month preceding such Distribution Date;
(B) the fair market value of all other property included in
the Trust Fund as of the last day of the month
preceding such Distribution Date, as determined by an
Independent appraiser acceptable to the Master Servicer
as of the date not more than 30 days prior to the last
day of the month preceding such Distribution Date;
(C) all unpaid interest accrued on such principal balance
of each such Mortgage Loan (including for this purpose
any Mortgage Loan as to which title to the related
Mortgaged Property has been acquired) at the Mortgage
Rate (plus the Excess Rate, to the extent applicable),
to the last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property Advances,
and unpaid Servicing Fees, Special Servicing
Compensation, Trustee Fees and Trust Fund expenses, in
each case to the extent permitted hereby with interest
on all unreimbursed Advances at the Advance Rate; and
(ii) the aggregate fair market value of the Mortgaged Property, and
all other property acquired in respect of any Mortgage Loan in
the Trust Fund, on the last day of the month preceding such
Distribution Date, as determined by an Independent appraiser
acceptable to the Master Servicer as of a date not more than 30
days prior to the last day of the month preceding such
Distribution Date, together with one month's interest thereon at
the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to this Section 9.01(c) shall
be borne by the party exercising its purchase rights hereunder. The Trustee
shall be entitled to rely conclusively on any determination made by an
Independent appraiser pursuant to this subsection (c).
Any Mortgage Loan purchased under the circumstances described in this
subsection (c) may only be purchased subject to a continuing right of (i) the
Persons who are then the holders of the Class Q Certificates to receive from the
purchaser(s), from time to time, payments corresponding to Default Interest with
respect to such Mortgage Loan and (ii) the Persons who are then the holders of
the Classes of Certificates entitled to receive the Deferred Interest with
respect to such Mortgage Loan, as specified in Section 2.06(b), to receive from
the purchaser(s), from time to time, payments corresponding to Deferred Interest
with respect to such Mortgage Loan, to the extent such Deferred Interest and
Default Interest have not been waived; provided that the Trustee shall have no
responsibility with respect to any continuing rights and the related portions of
the Grantor Trust shall be terminated upon such purchases.
(d) If the Trust Fund has not been previously terminated pursuant to
subsection (c) of this Section 9.01, the Trustee shall determine as soon as
practicable the Distribution Date on which the Trustee reasonably anticipates,
based on information with respect to the Mortgage Loans previously provided to
it, that the final distribution will be made (i) to the Holders of outstanding
Regular Certificates, and to the Trustee in respect of the Lower-Tier Regular
Interests, notwithstanding that such distribution may be insufficient to
distribute in full an amount equal to the remaining Certificate Principal Amount
of each such Certificate or Lower-Tier Regular Interest, together with amounts
required to be distributed on such Distribution Date pursuant to Section 4.01 or
(ii) if no such Regular Certificates are then outstanding, to the Holders of the
Class LR Certificates of any amount remaining in the Collection Account or the
Lower-Tier Distribution Account and to the Holders of the Class R Certificates
of any amount remaining in the Upper-Tier Distribution Account, in either case,
following the later to occur of (A) the receipt or collection of the last
payment due on any Mortgage Loan included in the Trust Fund or (B) the
liquidation or disposition pursuant to Section 3.18 of the last asset held by
the Trust Fund and (iii) to the holders of the Class Q Certificates, of any
amount remaining in the Class Q Distribution Account and to the holders of
Certificates entitled to receive Deferred Interest, as provided in Section
2.06(b), of any amount remaining in the Deferred Interest Distribution Account.
(e) Notice of any termination of the Trust Fund pursuant to this Section
9.01 shall be mailed by the Trustee to affected Certificateholders with a copy
to the Master Servicer and each Rating Agency at their addresses shown in the
Certificate Registrar as soon as practicable after the Trustee shall have
received, given or been deemed to have received a Notice of Termination but in
any event not more than thirty days, and not less than ten days, prior to the
Anticipated Termination Date. The notice mailed by the Trustee to affected
Certificateholders shall:
(i) specify the Anticipated Termination Date on which the final
distribution is anticipated to be made to Holders of
Certificates of the Classes specified therein;
(ii) specify the amount of any such final distribution, if known;
and
(iii) state that the final distribution to Certificateholders will
be made only upon presentation and surrender of Certificates
at the office of the Paying Agent therein specified.
If the Trust Fund is not terminated on any Anticipated Termination Date for
any reason, the Trustee shall promptly mail notice thereof to each affected
Certificateholder.
(f) Any funds not distributed on the Termination Date because of the
failure of any Certificateholders to tender their Certificates shall be set
aside and held in trust for the account of the appropriate non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice of the Termination Date 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with this Section 9.01.
<PAGE>
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. Counterparts.
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 10.02. Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust Fund, 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 Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
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 of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right 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 such Holder previously shall have given to the
Trustee a written notice of default and of the continuance thereof, as
hereinbefore provided, and unless also the Holders of Certificates representing
Percentage Interests of at least 25% of each affected Class of Certificates
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 of any Class shall have any right in any manner whatever 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, or to enforce any right
under this Agreement, except in the manner herein provided and for the equal,
ratable and common benefit of all Holders of Certificates of such Class. For the
protection and enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
SECTION 10.03. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 10.04. Notices.
All demands, notices and communications hereunder shall be in writing,
shall be deemed to have been given upon receipt (except that notices to Holders
of Class Q, Class R and Class LR Certificates or Holders of any Class of
Certificates no longer held through a Depository and instead held in registered,
definitive form shall be deemed to have been given upon being sent by first
class mail, postage prepaid) as follows:
If to the Trustee, to:
State Street Bank and Trust Company
Corporate Trust Department - 5th Floor
Two International Place
Boston, Massachusetts 02110
Attn: Morgan Stanley Series 1998-XL1
Fax No: (617) 664-5167
If to the Depositor, to:
Morgan Stanley Capital I Inc.
1585 Broadway
New York, New York 10036
Attention: Cecilia Tarrant
With a copy to: Gregory Walker, Esq.
Fax No: (212) 761-0525
If to the Master Servicer, to:
Midland Loan Services, Inc.,
210 West 10th Street
Kansas City, Missouri 64105
Attn: President
With a copy to:
Morrison & Hecker L.L.P.
2600 Grand Avenue
Kansas City, Missouri 64108
Attention: William A. Hirsch
Fax No.: (816) 474-4208
If to the Special Servicer, to:
Clarion Partners, LLC,
335 Madison Ave., 7th Floor
New York, NY 10017
Attn: Bruce Morrison
Fax No: (212) 883-2817
If to the Underwriter, to:
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Attention: Cecilia Tarrant
With a copy to: Gregory Walker, Esq.
If to any Certificateholder, to:
the address set forth in the
Certificate Register,
or, in the case of the parties to this Agreement, to such other address as such
party shall specify by written notice to the other parties hereto.
SECTION 10.05. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then, to the
extent permitted by applicable law, such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.
SECTION 10.06. Notice to the Depositor and Each Rating Agency.
(a) The Trustee shall use its best efforts to promptly provide notice to
the Depositor and 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 merger, consolidation, resignation or termination of the
Master Servicer, Special Servicer or the Trustee;
(iv) the repurchase of Mortgage Loans pursuant to Section
2.03(c);
(v) the final payment to any Class of Certificateholders;
(vi) any change in the location of the Collection Account, the
Lower-Tier Distribution Account or the Upper-Tier
Distribution Account;
(vii) any event that would result in the voluntary or involuntary
termination of any insurance of the accounts of the Master
Servicer;
(viii) any change in the lien priority of a Mortgage Loan;
(ix) any new lease of an anchor or a termination of an anchor
lease at a retail Mortgaged Property; and
(x) any material damage to a Mortgaged Property.
(b) The Master Servicer (or the Trustee with respect to item (iv) below or
the Special Servicer with respect to item (vi) below) shall promptly furnish to
each Rating Agency and, upon request, to each Certificateholder (at the expense
of such Certificateholder and subject to any requirement governing disclosure of
information under Section 3.20), to the extent not otherwise provided under this
Agreement, copies of the following:
(i) each of its annual statements as to compliance described in
Section 3.14;
(ii) each of its annual independent public accountants' servicing
reports described in Section 3.15;
(iii) a copy of each operating and other financial statement, rent
rolls, occupancy reports, and sales reports to the extent
such information is required to be delivered under a
Mortgage Loan, in each case to the extent collected pursuant
to Section 3.03 and to the extent consistent with applicable
law and the related Loan Documents;
(iv) each report to Certificateholders described in Section 4.02
and Section 3.20 and any Special Event Report prepared
pursuant to Section 3.20(b);
(v) each inspection report prepared in connection with any
inspection conducted pursuant to Section 3.19(a); and
(vi) a copy of each report (other than the preliminary report
referred to in Section 3.13(a) produced pursuant to Sections
3.13 and 3.24.
(c) The Master Servicer shall furnish each Rating Agency with such
information with respect to the Trust Fund, any Mortgaged Property, a Borrower
and a non-performing or Specially Serviced Mortgage Loan as such Rating Agency
shall reasonably request and which the Master Servicer can reasonably obtain.
The Rating Agencies shall not be charged any fee or expense in connection
therewith.
(d) Notices to each Rating Agency shall be addressed as follows:
Fitch IBCA, Inc.
One State Street Plaza, 31st Floor
New York, New York 10004
Attention: Commercial Mortgage Surveillance
Standard & Poor's Ratings Service
26 Broadway
New York, New York 10004
Attention: Commercial Mortgage Surveillance
or in each case to such other address as any Rating Agency shall specify by
written notice to the parties hereto.
SECTION 10.07. Amendment.
This Agreement or any Custodial Agreement may be amended from time to time
by the Depositor, the Master Servicer, the Special Servicer and the Trustee,
without the consent of any of the Certificateholders, (i) to cure any ambiguity,
(ii) to correct or supplement any provisions herein or therein that may be
defective or inconsistent with any other provisions herein or therein, (iii) to
amend any provision hereof or thereof to the extent necessary or desirable to
maintain the status of each of the Upper-Tier REMIC and Lower-Tier REMIC as a
REMIC, or to prevent the imposition of any material state or local taxes; (iv)
to amend or supplement any provisions herein or therein that shall not adversely
affect in any material respect the interests of any Certificateholder not
consenting thereto, as evidenced in writing by an Opinion of Counsel, at the
expense of the party requesting such amendment, or as evidenced by confirmation
in writing from each Rating Agency that such amendment or supplement will not
result in a qualification, withdrawal or downgrading of the then current ratings
assigned to the Certificates, (v) to amend or supplement any provisions therein
to the extent necessary or desirable to maintain the ratings assigned to each of
the Classes of Certificates by each Rating Agency or (vi) to make any other
provisions with respect to matters or questions arising under this Agreement,
which shall not be inconsistent with the provisions of this Agreement and will
not result in a downgrade, qualification or withdrawal of the then current
rating or ratings then assigned to any outstanding Class of Certificates, as
confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend this Agreement to modify, eliminate or add to any
of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
This Agreement or any Custodial Agreement may also be amended from time to
time by the Depositor, the Master Servicer, the Special Servicer and the Trustee
with the consent of the Holders of Certificates representing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or any Custodial
Agreement or of modifying in any manner the rights of the Certificateholders;
provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be
distributed on any Certificate without the consent of all
the holders of all Certificates representing all Percentage
Interests of the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or
inaction under this Agreement, without the consent of the
Holders of all Certificates representing all of the
Percentage Interest of the Class or Classes affected hereby;
(iii) alter the Servicing Standard or the obligations of the
Master Servicer, the Special Servicer or the Trustee to make
a P&I Advance or Property Advance without the consent of the
Holders of all Certificates representing all of the
Percentage Interests of the Class or Classes affected
thereby; or
(iv) amend any section hereof which relates to the amendment of
this Agreement without the consent of all the holders of all
Certificates representing all Percentage Interests of the
Class or Classes affected thereby.
In the event that neither the Depositor nor any successor thereto, if any,
is in existence, any amendment under this Section 10.07 shall be effective with
the consent of the Trustee and the Master Servicer, in writing, and to the
extent required by this Section, the Certificateholders. Promptly after the
execution of any amendment, the Master Servicer shall forward to the Trustee and
the Trustee shall furnish written notification of the substance of such
amendment to each Certificateholder and each Rating Agency. It shall not be
necessary for the consent of Certificateholders under this Section 10.07 to
approve the particular form of any proposed amendment, but it shall be
sufficient if such consent shall approve the substance thereof. The method of
obtaining such consents and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable regulations as
the Trustee may prescribe; provided, however, that such method shall always be
by affirmation and in writing.
Notwithstanding any contrary provision of this Agreement, no amendment
shall be made to this Agreement or any Custodial Agreement unless, if requested
by the Master Servicer and/or the Trustee, the Master Servicer and the Trustee
shall have received an Opinion of Counsel, at the expense of the party
requesting such amendment (or, if such amendment is required by any Rating
Agency to maintain the rating issued by it or requested by the Trustee for any
purpose described in clause (i) or (ii) of the first sentence of this Section,
then at the expense of the Trust Fund), to the effect that such amendment will
not cause any of the Upper-Tier REMIC or Lower-Tier REMIC to fail to qualify as
a REMIC at any time that any Certificates are outstanding, will not cause a tax
to be imposed on the Trust Fund under the REMIC Provisions (other than a tax at
the highest marginal corporate tax rate on net income from foreclosure property)
and will not cause the Grantor Trust to fail to qualify as a grantor trust.
Prior to the execution of any amendment to this Agreement or any Custodial
Agreement, the Trustee, the Special Servicer and the Master Servicer may request
and shall be entitled to rely conclusively upon an Opinion of Counsel, at the
expense of the party requesting such amendment (or, if such amendment is
required by any Rating Agency to maintain the rating issued by it or requested
by the Trustee for any purpose described in clause (i), (ii), (iii) or (v)
(which do not modify or otherwise relate solely to the obligations, duties or
rights of the Trustee) of the first sentence of this Section, then at the
expense of the Trust Fund) stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee may, but shall not be
obligated to, enter into any such amendment which affects the Trustee's own
rights, duties or immunities under this Agreement.
SECTION 10.08. Confirmation of Intent.
It is the express intent of the parties hereto that the conveyance of the
Trust Fund (including the Mortgage Loans) by the Depositor to the Trustee on
behalf of Certificateholders as contemplated by this Agreement and the sale by
the Depositor of the Certificates be, and be treated for all purposes as, a sale
by the Depositor of the undivided portion of the beneficial interest in the
Trust Fund represented by the Certificates. It is, further, not the intention of
the parties that such conveyance be deemed a pledge of the Trust Fund by the
Depositor to the Trustee to secure a debt or other obligation of the Depositor.
However, in the event that, notwithstanding the intent of the parties, the Trust
Fund is held to continue to be property of the Depositor then (a) this Agreement
shall also be deemed to be a security agreement under applicable law; (b) the
transfer of the Trust Fund provided for herein shall be deemed to be a grant by
the Depositor to the Trustee on behalf of Certificateholders of a first priority
security interest in all of the Depositor's right, title and interest in and to
the Trust Fund and all amounts payable to the holders of the Mortgage Loans in
accordance with the terms thereof and all proceeds of the conversion, voluntary
or involuntary, of the foregoing into cash, instruments, securities or other
property, including, without limitation, all amounts from time to time held or
invested in the Collection Account, Lower-Tier Distribution Account, Upper-Tier
Distribution Account, Class Q Distribution Account and Deferred Interest
Distribution Account, whether in the form of cash, instruments, securities or
other property; (c) the possession by the Trustee (or the Custodian on its
behalf) of 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 Delaware and Massachusetts Uniform Commercial Code; and
(d) notifications to Persons holding such property, and acknowledgments,
receipts or confirmations from Persons holding such property, shall be deemed
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. Any assignment of the
interest of the Trustee pursuant to any provision hereof shall also be deemed to
be an assignment of any security interest created hereby. The Depositor shall,
and upon the request of the Master Servicer, the Trustee shall, to the extent
consistent with this Agreement (and at the expense of the Trust Fund), 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. It is
the intent of the parties that such a security interest would be effective
whether any of the Certificates are sold, pledged or assigned.
SECTION 10.09. Third-Party Beneficiaries.
No Person other than a party to this Agreement and any Certificateholder
shall have any rights with respect to the enforcement of any of the rights or
obligations hereunder;.
Without limiting the foregoing, the parties to this Agreement specifically
state that no Borrower, Manager or other party to a Mortgage Loan is an intended
third-party beneficiary of this Agreement.
<PAGE>
IN WITNESS WHEREOF, the Depositor, the Master Servicer, the Special
Servicer and the Trustee have caused their names to be signed hereto by their
respective officers thereunto duly authorized all as of the day and year first
above written.
MORGAN STANLEY CAPITAL I INC.,
as Depositor
By:----------------------------------
Name:--------------------------------
Title:-------------------------------
MIDLAND LOAN SERVICES, INC.,
as Master Servicer
By:----------------------------------
Name:--------------------------------
Title:-------------------------------
CLARION PARTNERS, LLC,
as Special Servicer
By: CLARION PARTNERS, INC.,
its managing member
By:-----------------------
Name:---------------------
Title:--------------------
STATE STREET BANK AND TRUST COMPANY,
as Trustee, Custodian, Certificate
Registrar
By:----------------------------------
Name:--------------------------------
Title:-------------------------------
<PAGE>
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On this ----- day of ---------, 1998, before me, the undersigned, a Notary
Public in and for the State of New York, duly commissioned and sworn, personally
appeared ------------------------, to me known who, by me duly sworn, did depose
and acknowledge before me and say that he resides at ------------------------;
that she is the Vice President of Morgan Stanley Capital I Inc. a Delaware
corporation, the corporation described in and that executed the foregoing
instrument; and that he signed his name thereto under authority of the board of
directors of said corporation and on behalf of such corporation.
WITNESS my hand and seal hereto affixed the day and year first above
written.
------------------------------------------
NOTARY PUBLIC in and for the
State of New York.
My Commission expires:
(stamp)
(seal)
This instrument prepared by:
- -------------------------------
<PAGE>
STATE OF ---------------- )
) ss:
COUNTY OF --------------- )
On this ---- day of -------, 1998, before me, the undersigned, a Notary
Public in and for the State of ------------------, duly commissioned and sworn,
personally appeared -------------------, to me known who, by me duly sworn, did
depose and acknowledge before me and say that he/she is the
- ---------------------- Vice President of Midland Loan Services, Inc., the
corporation described in and that executed the foregoing instrument; and that
he/she signed his/her name thereto under authority of the board of directors of
said corporation and on behalf of such corporation.
WITNESS my hand and seal hereto affixed the day and year first above
written.
----------------------------
NOTARY PUBLIC in and for the
State of -------------.
My Commission expires:
(stamp)
(seal)
This instrument prepared by:
- ----------------------------
<PAGE>
STATE OF ---------------- )
) ss:
COUNTY OF --------------- )
On this ------ day of -------, 1998, before me, the undersigned, a Notary
Public in and for the State of -------------, duly commissioned and sworn,
personally appeared -------------------, to me known who, by me duly sworn, did
depose and acknowledge before me and say that he/she resides at
- ------------------------------; is the --------------- of State Street Bank and
Trust Company, Massachusetts Trust Company described in and that executed the
foregoing instrument; and that he/she signed his/her name thereto under
authority of the board of directors of said corporation and on behalf of such
corporation.
WITNESS my hand and seal hereto affixed the day and year first above
written.
----------------------------
NOTARY PUBLIC in and for the
State of -------------.
My Commission expires:
(stamp)
(seal)
This instrument prepared by:
- ----------------------------
<PAGE>
EXHIBIT A-1
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-XL1, CLASS A-1
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G(a)(1) AND 860D OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS A-1
Pass-Through Rate: 6.220%
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class A-1 Certificates:
$176,000,000
CUSIP: 61745M GG2 Initial Certificate Principal
Amount of this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class A-1 Certificates. The Trust Fund, described more fully
below, consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-2, Class A-3, Class X, Class
B, Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class Q, Class
R, and Class LR Certificates (together with the Class A-1 Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of l986, as amended.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class A-1
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
which such Distribution Date occurs, or if such day is not a Business Day, the
immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account and any
REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates; or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all
other property acquired in respect of any Mortgage Loan in the
Trust Fund, on the last day of the month preceding such
Distribution Date, as determined by an Independent appraiser
acceptable to the Master Servicer as of a date not more than 30
days prior to the last day of the month preceding such
Distribution Date, together with one month's interest thereon at
the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class A-1 Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class A-1 Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class A-1 Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class A-1
Certificate of the entire Percentage Interest represented by the within Class
A-1 Certificates to the above-named Assignee(s) and to deliver such Class A-1
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-2
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS A-2
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G(a)(1) AND 860D OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS A-2
Pass-Through Rate: 6.450%
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class A-2 Certificates:
$102,000,000
CUSIP: 61745M GH 0 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class A-2 Certificates. The Trust Fund, described more fully
below, consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-3, Class X, Class
B, Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class Q, Class
R and Class LR Certificates (together with the Class A-2 Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of l986, as amended.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class A-2
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, with the consent of the Holders of Certificates evidencing not less
than 66-2/3% of the Percentage Interests of each Class of Certificates affected
by the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class A-2 Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class A-2 Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class A-2 Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class A-2
Certificate of the entire Percentage Interest represented by the within Class
A-2 Certificates to the above-named Assignee(s) and to deliver such Class A-2
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-3
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS A-3
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G(a)(1) AND 860D OF THE INTERNAL REVENUE
CODE OF 1986.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS A-3
Pass-Through Rate: 6.480%
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class A-3 Certificates:
$393,239,000
CUSIP: 61745M GJ 6 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class A-3 Certificates. The Trust Fund, described more fully
below, consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class X, Class
B, Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class Q, Class
R and Class LR Certificates (together with the Class A-3 Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of l986, as amended.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class A-3
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class A-3 Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class A-3 Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class A-3 Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class A-3
Certificate of the entire Percentage Interest represented by the within Class
A-3 Certificates to the above-named Assignee(s) and to deliver such Class A-3
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-4
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS X
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THE HOLDERS OF THIS CLASS X CERTIFICATE WILL BE ENTITLED ONLY TO DISTRIBUTIONS
OF INTEREST ON THE NOTIONAL AMOUNT OF THE CLASS X CERTIFICATES AND WILL NOT BE
ENTITLED TO ANY DISTRIBUTIONS WITH RESPECT TO PRINCIPAL. THE NOTIONAL AMOUNT OF
THE CLASS X CERTIFICATES IS EQUAL TO THE AGGREGATE CERTIFICATE PRINCIPAL AMOUNTS
OF THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS B, CLASS C AND CLASS D
CERTIFICATES AS SET FORTH IN THE POOLING AGREEMENT REFERRED TO BELOW.
ACCORDINGLY, THE OUTSTANDING NOTIONAL AMOUNT OF THIS CERTIFICATE AT ANY TIME MAY
BE LESS THAN THE INITIAL NOTIONAL AMOUNT SET FORTH BELOW.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G(a)(1) AND 860D OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED.
THIS CERTIFICATE IS ISSUED ON JUNE 11, 1998, AT AN ISSUE PRICE OF [ ]% OF THE
INITIAL CLASS X NOTIONAL AMOUNT, INCLUDING ACCRUED INTEREST, AND A STATED
REDEMPTION PRICE AT MATURITY EQUAL TO ALL INTEREST DISTRIBUTIONS HEREON, AND IS
ISSUED WITH ORIGINAL ISSUE DISCOUNT ("OID") FOR FEDERAL INCOME TAX PURPOSES.
ASSUMING (A) THAT THIS CERTIFICATE PAYS IN ACCORDANCE WITH PROJECTED CASH FLOWS
REFLECTING THE PREPAYMENT ASSUMPTION OF SCENARIO 1 (AS DESCRIBED IN THE
PROSPECTUS SUPPLEMENT DATED JUNE 1, 1998 WITH RESPECT TO THE OFFERING OF THE
CLASS A-1, CLASS A-2, CLASS A-3, CLASS X, CLASS B, CLASS C, CLASS D, CLASS E AND
CLASS F CERTIFICATES) USED TO PRICE THIS CERTIFICATE AND (B) THAT THE
PASS-THROUGH RATE HEREON CHANGES IN ACCORDANCE WITH THE PREPAYMENT ASSUMPTION:
(I) THE AMOUNT OF OID AS A PERCENTAGE OF THE INITIAL CLASS X NOTIONAL AMOUNT IS
APPROXIMATELY [ ]%; (II) THE ANNUAL YIELD TO MATURITY OF THIS CERTIFICATE,
COMPOUNDED MONTHLY, IS APPROXIMATELY [ ]%; AND (III) THE AMOUNT OF OID ALLOCABLE
TO THE SHORT FIRST ACCRUAL PERIOD (JUNE 11, 1998 TO JULY 3, 1998) AS A
PERCENTAGE OF THE INITIAL CLASS X NOTIONAL AMOUNT, CALCULATED USING THE EXACT
METHOD, IS APPROXIMATELY [ ]%.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS X
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Notional Amount of the Distribution Date: June 2028
Class X Certificates:
$796,229,000
CUSIP: 61745M GK 3 Initial Notional
Amount of this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class X Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class X Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a "regular interest" in a "real estate mortgage
investment conduit," as those terms are defined, respectively, in Sections
860G(a)(1) and 860D of the Internal Revenue Code of l986, as amended.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
interest then distributable, if any, allocable to the Class X Certificates for
such Distribution Date, all as more fully described in the Pooling Agreement.
Holders of this Certificate may be entitled to Prepayment Premiums, as provided
in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account and any
REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class X Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class X Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class X Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class X
Certificate of the entire Percentage Interest represented by the within Class X
Certificates to the above-named Assignee(s) and to deliver such Class X
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-5
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS B
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS B CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS B
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class B Certificates:
$13,888,000
CUSIP: 61745M GL 1 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class B Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class B Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class B
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class B Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class B Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class B Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class B
Certificate of the entire Percentage Interest represented by the within Class B
Certificates to the above-named Assignee(s) and to deliver such Class B
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-6
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS C
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS C CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS C
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class C Certificates:
$46,293,000
CUSIP: 61745M GM 9 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class C Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class D, Class E, Class F, Class G, Class H, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class C Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class C
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class C Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class C Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class C Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class C
Certificate of the entire Percentage Interest represented by the within Class C
Certificates to the above-named Assignee(s) and to deliver such Class C
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-7
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS D
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS D CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS D
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class D Certificates:
$64,809,000
CUSIP: 61745M GN 7 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class D Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class C, Class E, Class F, Class G, Class H, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class D Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class D
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class D Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class D Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class D Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class D
Certificate of the entire Percentage Interest represented by the within Class D
Certificates to the above-named Assignee(s) and to deliver such Class D
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-8
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS E
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS E CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS E
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class E Certificates:
$46,292,000
CUSIP: 61745M GP 2 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class E Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class C, Class D, Class F, Class G, Class H, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class E Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class E
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class E Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class E Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class E Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class E
Certificate of the entire Percentage Interest represented by the within Class E
Certificates to the above-named Assignee(s) and to deliver such Class E
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-9
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS F
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS F CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS F
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class F Certificates:
$11,663,000
CUSIP: GQ 0 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class F Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class C, Class D, Class E, Class G, Class H, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class F Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class F
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums, as provided in the Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class F Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class F Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class F Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class F
Certificate of the entire Percentage Interest represented by the within Class F
Certificates to the above-named Assignee(s) and to deliver such Class F
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-10
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS G
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS G CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A)(1) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF
RULE 144A (A "QIB"), WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) TO AN
INSTITUTIONAL INVESTOR THAT IS, OR ALL THE EQUITY OWNERS OF WHICH ARE,
INSTITUTIONAL "ACCREDITED INVESTORS" AS SUCH TERM IS DEFINED IN RULE
501(A)(1),(2),(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 (IF AVAILABLE) OR (3) BY AN
INITIAL INVESTOR THAT IS A QIB, TO AN INSTITUTIONAL ACCREDITED INVESTOR AND (B)
IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS G
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class G Certificates:
$30,000,000
CUSIP: 61745M GR 8 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class G Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class C, Class D, Class E, Class F, Class H, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class G Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class G
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage as from time to time are subject to the Pooling Agreement, together
with the Mortgage Files relating thereto; (ii) all scheduled or unscheduled
payments on or collections in respect of the Mortgage Loans due after the
Cut-Off Date; (iii) any REO Property; (iv) all revenues received in respect of
any REO Property; (v) the Master Servicer's and the Trustee's rights under the
insurance policies with respect to the Mortgage Loans required to be maintained
pursuant to the Pooling Agreement and any proceeds thereof; (vi) any Assignments
of Leases, Rents and Profits and any security agreements; (vii) any indemnities
or guaranties given as additional security for any Mortgage Loans; (viii) all
assets deposited in the Lock-Box Accounts, Cash Collateral Accounts, Escrow
Accounts, Reserve Accounts (to the extent such assets in such accounts are not
assets of the respective Borrowers), the Collection Account, the Lower-Tier
Distribution Account, the Upper-Tier Distribution Account, the Deferred Interest
Distribution Account, the Class Q Distribution Account, and any REO Account
including reinvestment income thereon; (ix) any environmental indemnity
agreements relating to the Mortgaged Properties; (x) the rights and remedies
under the Loan Sale Agreement; and (xi) the proceeds of any of the foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class G Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class G Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class G Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class G
Certificate of the entire Percentage Interest represented by the within Class G
Certificates to the above-named Assignee(s) and to deliver such Class G
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-11
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS H
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS H CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A)(1) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF
RULE 144A (A "QIB"), WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) TO AN
INSTITUTIONAL INVESTOR THAT IS, OR ALL THE EQUITY OWNERS OF WHICH ARE,
INSTITUTIONAL "ACCREDITED INVESTORS" AS SUCH TERM IS DEFINED IN RULE
501(A)(1),(2),(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 (IF AVAILABLE) OR (3) BY AN
INITIAL INVESTOR THAT IS A QIB, TO AN INSTITUTIONAL ACCREDITED INVESTOR AND (B)
IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
THIS CERTIFICATE IS ISSUED ON JUNE 11, 1998, AND BASED ON ITS ISSUE PRICE OF [
]%, INCLUDING ACCRUED INTEREST, AND A STATED REDEMPTION PRICE AT MATURITY EQUAL
TO ITS INITIAL PRINCIPAL BALANCE (PLUS 8 DAYS OF INTEREST AT THE PASS-THROUGH
RATE HEREON), IS ISSUED WITH ORIGINAL ISSUE DISCOUNT ("OID") FOR FEDERAL INCOME
TAX PURPOSES. ASSUMING THAT THIS CERTIFICATE PAYS IN ACCORDANCE WITH PROJECTED
CASH FLOWS REFLECTING THE PREPAYMENT ASSUMPTION OF SCENARIO 1 (AS DESCRIBED IN
THE PROSPECTUS SUPPLEMENT DATED JUNE 1, 1998 WITH RESPECT TO THE OFFERING OF THE
CLASS A-1, CLASS A-2, CLASS A-3, CLASS X, CLASS B, CLASS C, CLASS D, CLASS E AND
CLASS F CERTIFICATES) USED TO PRICE THIS CERTIFICATE: (I) THE AMOUNT OF OID AS A
PERCENTAGE OF THE INITIAL PRINCIPAL BALANCE OF THIS CERTIFICATE IS APPROXIMATELY
[ ]%; (II) THE ANNUAL YIELD TO MATURITY OF THIS CERTIFICATE, COMPOUNDED MONTHLY,
IS APPROXIMATELY [ ]%; AND (III) THE AMOUNT OF OID ALLOCABLE TO THE SHORT FIRST
ACCRUAL PERIOD (JUNE 11, 1998 TO JULY 3, 1998) AS A PERCENTAGE OF THE INITIAL
PRINCIPAL BALANCE OF THIS CERTIFICATE, CALCULATED USING THE EXACT METHOD, IS
APPROXIMATELY [ ]%.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS H
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class H Certificates:
$27,776,000
CUSIP: 61745M GS 6 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class H Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class C, Class D, Class E, Class F, Class G, Class J, Class Q,
Class R, and Class LR Certificates (together with the Class H Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class H
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class H Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class H Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class H Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class H
Certificate of the entire Percentage Interest represented by the within Class H
Certificates to the above-named Assignee(s) and to deliver such Class H
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
<PAGE>
EXHIBIT A-12
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS J
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR 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 INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL AMOUNT OF THIS
CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE PRINCIPAL
AMOUNT SET FORTH BELOW.
THIS CLASS J CERTIFICATE IS SUBORDINATE TO CERTAIN OTHER CLASSES OF CERTIFICATES
TO THE EXTENT SET FORTH IN THE POOLING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A)(1) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF
RULE 144A (A "QIB"), WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) TO AN
INSTITUTIONAL INVESTOR THAT IS, OR ALL THE EQUITY OWNERS OF WHICH ARE,
INSTITUTIONAL "ACCREDITED INVESTORS" AS SUCH TERM IS DEFINED IN RULE
501(A)(1),(2),(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 (IF AVAILABLE) OR (3) BY AN
INITIAL INVESTOR THAT IS A QIB, TO AN INSTITUTIONAL ACCREDITED INVESTOR AND (B)
IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN, OTHER THAN AN INSURANCE COMPANY USING THE ASSETS OF ITS
GENERAL ACCOUNT UNDER CIRCUMSTANCES WHEREBY SUCH PURCHASE AND THE SUBSEQUENT
HOLDING OF SUCH CERTIFICATE BY SUCH INSURANCE COMPANY WOULD BE EXEMPT FROM THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA AND SECTION 4975 OF THE CODE UNDER
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60. EACH PROSPECTIVE TRANSFEREE OF
THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE, (I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE
FORM OF EXHIBIT D-2 TO THE POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT
SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO TITLE I OF ERISA, SECTION 4975
OF THE CODE OR SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF ERISA OR SECTION 4975 OF THE CODE OR A
MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR LAW, AND WILL NOT SUBJECT THE
MASTER SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE
CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR
LIABILITIES UNDER ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW) IN ADDITION TO
THOSE SET FORTH IN THE POOLING AGREEMENT, WHICH OPINION OF COUNSEL SHALL NOT BE
AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE MASTER SERVICER, THE SPECIAL
SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR. EACH TRANSFEREE OF A
BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO REPRESENT THAT IT IS NOT A PERSON
REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A PRO RATA
UNDIVIDED BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE, AND CERTAIN OTHER ASSETS.
THIS CERTIFICATE IS ISSUED ON JUNE 11, 1998, AND BASED ON ITS ISSUE PRICE OF [
]%, INCLUDING ACCRUED INTEREST, AND A STATED REDEMPTION PRICE AT MATURITY EQUAL
TO ITS INITIAL PRINCIPAL BALANCE (PLUS 8 DAYS OF INTEREST AT THE PASS-THROUGH
RATE HEREON), IS ISSUED WITH ORIGINAL ISSUE DISCOUNT ("OID") FOR FEDERAL INCOME
TAX PURPOSES. ASSUMING THAT THIS CERTIFICATE PAYS IN ACCORDANCE WITH PROJECTED
CASH FLOWS REFLECTING THE PREPAYMENT ASSUMPTION OF SCENARIO 1 (AS DESCRIBED IN
THE PROSPECTUS SUPPLEMENT DATED JUNE 1, 1998 WITH RESPECT TO THE OFFERING OF THE
CLASS A-1, CLASS A-2, CLASS A-3, CLASS X, CLASS B, CLASS C, CLASS D, CLASS E AND
CLASS F CERTIFICATES) USED TO PRICE THIS CERTIFICATE: (I) THE AMOUNT OF OID AS A
PERCENTAGE OF THE INITIAL PRINCIPAL BALANCE OF THIS CERTIFICATE IS APPROXIMATELY
[ ]%; (II) THE ANNUAL YIELD TO MATURITY OF THIS CERTIFICATE, COMPOUNDED MONTHLY,
IS APPROXIMATELY [ ]%; AND (III) THE AMOUNT OF OID ALLOCABLE TO THE SHORT FIRST
ACCRUAL PERIOD (JUNE 11, 1998 TO JULY 3, 1998) AS A PERCENTAGE OF THE INITIAL
PRINCIPAL BALANCE OF THIS CERTIFICATE, CALCULATED USING THE EXACT METHOD, IS
APPROXIMATELY [ ]%.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS J
Pass-Through Rate: As determined in accordance with the
Pooling Agreement.
First Distribution Date: Cut-Off Date: June 1, 1998
July 3, 1998
Aggregate Initial Scheduled Final
Certificate Principal Amount of the Distribution Date: June 2028
Class J Certificates:
$13,888,151
CUSIP: 61745M GT 4 Initial Certificate
Principal Amount of
this Certificate:
ISIN: $
Common Code:
No.: 1
This certifies that CEDE & CO. is the registered owner of a beneficial
ownership interest in a Trust Fund, including the distributions to be made with
respect to the Class J Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class Q,
Class R, and Class LR Certificates (together with the Class J Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a pro rata undivided beneficial interest in a
"regular interest" in a "real estate mortgage investment conduit," as those
terms are defined, respectively, in Sections 860G(a)(1) and 860D of the Internal
Revenue Code of l986, as amended, and certain other assets.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class J
Certificates for such Distribution Date, all as more fully described in the
Pooling Agreement.
Interest accrued on this Certificate during an Interest Accrual Period,
plus the aggregate unpaid Interest Shortfall with respect to this Certificate,
if any, will be payable on the related Distribution Date to the extent provided
in the Pooling Agreement. The "Interest Accrual Period" with respect to any
Distribution Date and with respect to each Class of Certificates is the calendar
month preceding the month in which such Distribution Date occurs. Each Interest
Accrual Period with respect to each Class of Certificates is assumed to consist
of 30 days.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class J Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class J Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class J Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class J
Certificate of the entire Percentage Interest represented by the within Class J
Certificates to the above-named Assignee(s) and to deliver such Class J
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-13
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS Q
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A)(1) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF
RULE 144A (A "QIB"), WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) TO AN
INSTITUTIONAL INVESTOR THAT IS, OR ALL THE EQUITY OWNERS OF WHICH ARE,
INSTITUTIONAL "ACCREDITED INVESTORS" AS SUCH TERM IS DEFINED IN RULE
501(A)(1),(2),(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 (IF AVAILABLE) OR (3) BY AN
INITIAL INVESTOR THAT IS A QIB, TO AN INSTITUTIONAL ACCREDITED INVESTOR AND (B)
IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH INCLUDE
ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO INCLUDE
ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE
ASSETS OF ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE
REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE,
(I) A REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO THE
POOLING AGREEMENT REFERRED TO HEREIN, STATING THAT SUCH PROSPECTIVE TRANSFEREE
IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B) ABOVE, OR (II) AN OPINION OF
COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE THAT THE PURCHASE AND HOLDING OF THIS CERTIFICATE WILL
NOT RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND
SUBJECT TO TITLE I OF ERISA OR SECTION 4975 OF THE CODE OR SIMILAR LAW, WILL NOT
CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF ERISA,
SECTION 4975 OF THE CODE OR A MATERIALLY SIMILAR CHARACTERIZATION UNDER SIMILAR
LAW, AND WILL NOT SUBJECT THE MASTER SERVICER, THE SPECIAL SERVICER, THE
DEPOSITOR, THE TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR
LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA, SECTION 4975 OF THE
CODE OR SIMILAR LAW) IN ADDITION TO THOSE SET FORTH IN THE POOLING AGREEMENT,
WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE TRUST FUND,
THE MASTER SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR THE
DEPOSITOR. EACH TRANSFEREE OF A BENEFICIAL INTEREST HEREIN SHALL BE DEEMED TO
REPRESENT THAT IT IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR (B) ABOVE.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS Q
Percentage Interest: 100% Cut-Off Date: June 1, 1998
No.: 1
This certifies that Morgan Stanley Capital I Inc. is the registered owner
of an interest in a Trust Fund, including the distributions to be made with
respect to the Class Q Certificates. The Trust Fund, described more fully below,
consists primarily of a pool of Mortgage Loans secured by first liens on
commercial properties and held in trust by the Trustee and serviced by the
Master Servicer. The Trust Fund was created, and the Mortgage Loans are to be
serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J,
Class R, and Class LR Certificates (together with the Class Q Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
This Certificate represents a pro rata undivided interest in the Default
Interest, subject to an obligation to pay interest on Advances. Pursuant to the
terms of the Pooling Agreement, the Trustee, or the Paying Agent on behalf of
the Trustee, will distribute (other than the final distribution on any
Certificate), on the third Business Day of each month, commencing in July 1998
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to such
Person's pro rata share (based on the Percentage Interest represented by this
Certificate) of that portion of the aggregate amount of Net Default Interest
then distributable, if any, allocable to the Class Q Certificates for such
Distribution Date, all as more fully described in the Pooling Agreement.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class Q Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class Q Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class Q Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class Q
Certificate of the entire Percentage Interest represented by the within Class Q
Certificates to the above-named Assignee(s) and to deliver such Class Q
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
<PAGE>
EXHIBIT A-14
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS R
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) PURSUANT TO RULE
144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF
RULE 144A (A "QIB"), WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, AND (B) IN
ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY THAT IS USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH
INCLUDE ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO
INCLUDE ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR
USING THE ASSETS OF ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS
CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE A REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF
EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING
THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR
(B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G(a)(2) AND 860D OF THE CODE. A TRANSFEREE OF THIS
CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE ACCEPTED THIS CERTIFICATE
SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFERABILITY, AS SET FORTH IN SECTION
5.02(1) OF THE POOLING AND SERVICING AGREEMENT, AND SHALL BE REQUIRED TO FURNISH
AN AFFIDAVIT TO THE TRANSFEROR AND THE TRUSTEE TO THE EFFECT THAT, AMONG OTHER
THINGS, (A) IT IS NOT A DISQUALIFIED ORGANIZATION, AS SUCH TERM IS DEFINED IN
CODE SECTION 860E(e)(5), OR AN AGENT (INCLUDING A BROKER, NOMINEE OR OTHER
MIDDLEMAN) FOR SUCH DISQUALIFIED ORGANIZATION AND IS OTHERWISE A PERMITTED
TRANSFEREE (AS DEFINED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN), (B) IT HAS HISTORICALLY PAID ITS DEBTS AS THEY HAVE COME DUE AND
INTENDS TO CONTINUE TO PAY ITS DEBTS AS THEY COME DUE IN THE FUTURE, AND (C) IT
INTENDS TO PAY ANY TAXES ASSOCIATED WITH HOLDING THIS CERTIFICATE AS THEY BECOME
DUE. ANY PURPORTED TRANSFER TO A DISQUALIFIED ORGANIZATION OR OTHER PERSON THAT
IS NOT A PERMITTED TRANSFEREE OR OTHERWISE IN VIOLATION OF THESE RESTRICTIONS
SHALL BE ABSOLUTELY NULL AND VOID AND SHALL VEST NO RIGHTS IN ANY PURPORTED
TRANSFEREE. IF THIS CERTIFICATE REPRESENTS A "NON-ECONOMIC RESIDUAL INTEREST",
AS DEFINED IN TREASURY REGULATIONS SECTION 1.860E-l(c), TRANSFERS OF THIS
CERTIFICATE MAY BE DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. IN ORDER TO
SATISFY A REGULATORY SAFE HARBOR UNDER WHICH SUCH TRANSFERS WILL NOT BE
DISREGARDED, THE TRANSFEROR MAY BE REQUIRED, AMONG OTHER THINGS, TO SATISFY
ITSELF AS TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. THE HOLDER OF
THIS CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE AGREED TO CONSENT TO
ACT AS "TAX MATTERS PERSON" OF THE UPPER-TIER REMIC AND TO THE APPOINTMENT OF
THE TRUSTEE AS ATTORNEY-IN-FACT AND AGENT FOR THE TAX MATTERS PERSON OR AS
OTHERWISE PROVIDED IN THE POOLING AND SERVICING AGREEMENT TO PERFORM THE
FUNCTIONS OF A "TAX MATTERS PERSON" FOR PURPOSES OF SUBCHAPTER C OF CHAPTER 63
OF SUBTITLE F OF THE CODE.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS R
Percentage Interest: 100%
No.: 1
This certifies that Morgan Stanley & Co. Incorporated is owner the
registered owner of an interest in a Trust Fund, including the distributions to
be made with respect to the Class R Certificates. The Trust Fund, described more
fully below, consists primarily of a pool of Mortgage Loans secured by first
liens on commercial properties and held in trust by the Trustee and serviced by
the Master Servicer. The Trust Fund was created, and the Mortgage Loans are to
be serviced, pursuant to the Pooling Agreement (as defined below). The Holder of
this Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling Agreement and is bound thereby. Also
issued under the Pooling Agreement are the Class A-1, Class A-2, Class A-3,
Class X, Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class Q,
and Class LR Certificates (together with the Class R Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a "residual interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(2) and 860D of the Internal Revenue Code of l986, as amended.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of the aggregate amount, if any, allocable to
the Class R Certificates for such Distribution Date, all as more fully described
in the Pooling Agreement.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class R Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class R Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class R Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class R
Certificate of the entire Percentage Interest represented by the within Class R
Certificates to the above-named Assignee(s) and to deliver such Class R
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT A-15
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS LR
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF THE
DEPOSITOR, THE MASTER SERVICER, THE TRUSTEE, THE UNDERWRITER OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) PURSUANT TO RULE
144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF
RULE 144A (A "QIB"), WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, AND (B) IN
ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN SHOULD NOT BE PURCHASED BY A TRANSFEREE
THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH IS SUBJECT TO TITLE I OF
THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A
GOVERNMENTAL PLAN (AS DEFINED IN SECTION 3(32) OF ERISA) THAT IS SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") WHICH IS, TO A MATERIAL EXTENT,
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (EACH, A "PLAN"), OR
(B) A COLLECTIVE INVESTMENT FUND IN WHICH SUCH PLANS ARE INVESTED, AN INSURANCE
COMPANY THAT IS USING ASSETS OF SEPARATE ACCOUNTS OR GENERAL ACCOUNTS WHICH
INCLUDE ASSETS OF PLANS (OR WHICH ARE DEEMED PURSUANT TO ERISA OR SIMILAR LAW TO
INCLUDE ASSETS OF PLANS) OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR
USING THE ASSETS OF ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS
CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE
REGISTRAR AND THE TRUSTEE A REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF
EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING
THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A) OR
(B) ABOVE.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G(a)(2) AND 860D OF THE CODE. A TRANSFEREE OF THIS
CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE ACCEPTED THIS CERTIFICATE
SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFERABILITY, AS SET FORTH IN SECTION
5.02(1) OF THE POOLING AND SERVICING AGREEMENT, AND SHALL BE REQUIRED TO FURNISH
AN AFFIDAVIT TO THE TRANSFEROR AND THE TRUSTEE TO THE EFFECT THAT, AMONG OTHER
THINGS, (A) IT IS NOT A DISQUALIFIED ORGANIZATION, AS SUCH TERM IS DEFINED IN
CODE SECTION 860E(e)(5), OR AN AGENT (INCLUDING A BROKER, NOMINEE OR OTHER
MIDDLEMAN) FOR SUCH DISQUALIFIED ORGANIZATION AND IS OTHERWISE A PERMITTED
TRANSFEREE (AS DEFINED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN), (B) IT HAS HISTORICALLY PAID ITS DEBTS AS THEY HAVE COME DUE AND
INTENDS TO CONTINUE TO PAY ITS DEBTS AS THEY COME DUE IN THE FUTURE, AND (C) IT
INTENDS TO PAY ANY TAXES ASSOCIATED WITH HOLDING THIS CERTIFICATE AS THEY BECOME
DUE. ANY PURPORTED TRANSFER TO A DISQUALIFIED ORGANIZATION OR OTHER PERSON THAT
IS NOT A PERMITTED TRANSFEREE OR OTHERWISE IN VIOLATION OF THESE RESTRICTIONS
SHALL BE ABSOLUTELY NULL AND VOID AND SHALL VEST NO RIGHTS IN ANY PURPORTED
TRANSFEREE. IF THIS CERTIFICATE REPRESENTS A "NON-ECONOMIC RESIDUAL INTEREST",
AS DEFINED IN TREASURY REGULATIONS SECTION 1.860E-l(c), TRANSFERS OF THIS
CERTIFICATE MAY BE DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. IN ORDER TO
SATISFY A REGULATORY SAFE HARBOR UNDER WHICH SUCH TRANSFERS WILL NOT BE
DISREGARDED, THE TRANSFEROR MAY BE REQUIRED, AMONG OTHER THINGS, TO SATISFY
ITSELF AS TO THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. THE HOLDER OF
THIS CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE AGREED TO CONSENT TO
ACT AS "TAX MATTERS PERSON" OF THE LOWER-TIER REMIC AND TO THE APPOINTMENT OF
THE TRUSTEE AS ATTORNEY-IN-FACT AND AGENT FOR THE TAX MATTERS PERSON OR AS
OTHERWISE PROVIDED IN THE POOLING AND SERVICING AGREEMENT TO PERFORM THE
FUNCTIONS OF A "TAX MATTERS PERSON" FOR PURPOSES OF SUBCHAPTER C OF CHAPTER 63
OF SUBTITLE F OF THE CODE.
<PAGE>
MORGAN STANLEY CAPITAL I INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-XL1, CLASS LR
Percentage Interest: 100%
No.: 1
This certifies that Morgan Stanley & Co. Incorporated is owner the
registered owner of an interest in a Trust Fund, including the distributions to
be made with respect to the Class LR Certificates. The Trust Fund, described
more fully below, consists primarily of a pool of Mortgage Loans secured by
first liens on commercial properties and held in trust by the Trustee and
serviced by the Master Servicer. The Trust Fund was created, and the Mortgage
Loans are to be serviced, pursuant to the Pooling Agreement (as defined below).
The Holder of this Certificate, by virtue of the acceptance hereof, assents to
the terms, provisions and conditions of the Pooling Agreement and is bound
thereby. Also issued under the Pooling Agreement are the Class A-1, Class A-2,
Class A-3, Class X, Class C, Class D, Class E, Class F, Class G, Class H, Class
J, Class Q, and Class R Certificates (together with the Class LR Certificates,
the "Certificates"; the Holders of Certificates issued under the Pooling
Agreement are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance with, the terms
of a Pooling and Servicing Agreement, dated as of June 1, 1998 (the "Pooling
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee. To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling Agreement.
This Certificate represents a "residual interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(2) and 860D of the Internal Revenue Code of l986, as amended.
The Trustee makes no representation or warranty as to any of the statements
contained herein or the validity or sufficiency of the Certificates or the
Mortgage Loans and has executed this Certificate in its limited capacity as
Trustee under the Pooling Agreement.
Pursuant to the terms of the Pooling Agreement, the Trustee, or the Paying
Agent on behalf of the Trustee, will distribute (other than the final
distribution on any Certificate), on the third Business Day of each month,
commencing in July 1998 (each such date, a "Distribution Date"), to the Person
in whose name this Certificate is registered as of the related Record Date, an
amount equal to such Person's pro rata share (based on the Percentage Interest
represented by this Certificate) of the aggregate amount, if any, allocable to
the Class LR Certificates for such Distribution Date, all as more fully
described in the Pooling Agreement.
All distributions (other than the final distribution on any Certificate)
will be made by the Paying Agent to the persons in whose names the Certificates
are registered at the close of business on each Record Date, which will be the
close of business on the last day of the month immediately preceding the month
in which such Distribution Date occurs, or if such day is not a Business Day,
the immediately preceding Business Day. Such distributions shall be made on each
Distribution Date other than the Termination Date to each Certificateholder of
record on the related Record Date (a) by wire transfer of immediately available
funds to the account of such Certificateholder at a bank or other entity located
in the United States and having appropriate facilities therefor, if such
Certificateholder provides the Trustee with wiring instructions no less than
five Business Days prior to the related Record Date, or otherwise (b) by check
mailed to such Certificateholder. The final distribution on each Certificate
shall be made in like manner, but only upon presentment and surrender of such
Certificate at the office of the Trustee or its agent (which may be the Paying
Agent or the Certificate Registrar acting as such agent) that is specified in
the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of the failure of
any Certificateholders to tender their Certificates shall be set aside and held
in trust for the account of the appropriate non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.01 of the Pooling
Agreement 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 Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets which
remain held. If within two years after the second notice any Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Class R Certificateholders all amounts distributable to the Holders thereof. No
interest shall accrue or be payable to any Certificateholder on any amount held
as a result of such Certificateholder's failure to surrender its Certificate(s)
for final payment thereof in accordance with Section 9.01 of the Pooling
Agreement.
This Certificate is limited in right of payment to, among other things,
certain collections and recoveries in respect of the Mortgage Loans, as more
specifically set forth herein and in the Pooling Agreement.
As provided in the Pooling Agreement, the Trust Fund includes (i) such
Mortgage Loans as from time to time are subject to the Pooling Agreement,
together with the Mortgage Files relating thereto; (ii) all scheduled or
unscheduled payments on or collections in respect of the Mortgage Loans due
after the Cut-Off Date; (iii) any REO Property; (iv) all revenues received in
respect of any REO Property; (v) the Master Servicer's and the Trustee's rights
under the insurance policies with respect to the Mortgage Loans required to be
maintained pursuant to the Pooling Agreement and any proceeds thereof; (vi) any
Assignments of Leases, Rents and Profits and any security agreements; (vii) any
indemnities or guaranties given as additional security for any Mortgage Loans;
(viii) all assets deposited in the Lock-Box Accounts, Cash Collateral Accounts,
Escrow Accounts, Reserve Accounts (to the extent such assets in such accounts
are not assets of the respective Borrowers), the Collection Account, the
Lower-Tier Distribution Account, the Upper-Tier Distribution Account, the
Deferred Interest Distribution Account, the Class Q Distribution Account, and
any REO Account including reinvestment income thereon; (ix) any environmental
indemnity agreements relating to the Mortgaged Properties; (x) the rights and
remedies under the Loan Sale Agreement; and (xi) the proceeds of any of the
foregoing.
This Certificate does not purport to summarize the Pooling Agreement, and
reference is made to the Pooling Agreement for the interests, rights, benefits,
obligations and duties evidenced hereby, and the limitations thereon, and the
rights, duties and immunities of the Trustee.
As provided in the Pooling Agreement and subject to certain limitations set
forth therein, this Certificate is transferable or exchangeable only upon
surrender of this Certificate to the Certificate Registrar at the Corporate
Trust Office together with an assignment and transfer (executed by the Holder or
his duly authorized attorney), subject to the applicable requirements in Article
V of the Pooling Agreement. Upon surrender for registration of transfer of this
Certificate, subject to the applicable requirements of Article V of the Pooling
Agreement, the Trustee shall execute and the Authenticating Agent shall duly
authenticate in the name of the designated transferee or transferees, one or
more new Certificates in Denominations of a like aggregate Denomination of this
Certificate. Such Certificates shall be delivered by the Certificate Registrar
in accordance with Section 5.02(e) of the Pooling Agreement.
Prior to due presentation of this Certificate for registration of transfer,
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar, any Paying Agent and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar, any Paying Agent or any agent
of any of them shall be affected by any notice or knowledge to the contrary.
No fee or service shall be imposed by the Certificate Registrar for its
services in respect of any registration of transfer or exchange referred to in
Section 5.02 of the Pooling Agreement other than for transfers to Institutional
Accredited Investors, as also provided therein. In connection with any transfer
to a transferee that is not a QIB, the transferor shall reimburse the Trust Fund
for any costs (including the cost of the Certificate Registrar's counsel's
review of the documents and any legal opinions, submitted by the transferor or
transferee to the Certificate Registrar as provided herein) incurred by the
Certificate Registrar in connection with such transfer. The Certificate
Registrar may require payment by each transferor of a sum sufficient to cover
any tax, expense or other governmental charge payable in connection with any
such transfer.
The Pooling Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders; (i) to cure any
ambiguity; (ii) to correct or supplement any provisions in the Pooling Agreement
or any Custodial Agreement that may be defective or inconsistent with any other
provisions in such agreement; (iii) to amend any provision thereof to the extent
necessary or desirable to maintain the status of each of the Upper-Tier REMIC,
and Lower-Tier REMIC as a REMIC, or to prevent the imposition of any material
state or local taxes; (iv) to amend or supplement any provisions in either of
such agreements to the extent necessary or desirable to maintain the rating or
ratings assigned to each of the Classes of Certificates by each Rating Agency;
(v) to amend or supplement any provisions in either of such agreements that
shall not adversely affect in any material respect the interests of any
Certificateholder not consenting thereto, as evidenced in writing by an Opinion
of Counsel, at the expense of the party requesting such amendment, or as
evidenced by confirmation in writing from each Rating Agency that such amendment
or supplement will not result in a qualification, withdrawal or downgrading of
the then-current ratings assigned to the Certificates, or (vi) to make any other
provisions with respect to matters or questions arising under the Pooling
Agreement, which shall not be inconsistent with the provisions of the Pooling
Agreement and will not result in a downgrade, qualification or withdrawal of the
then current rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing.
Further, the Depositor, the Master Servicer, the Special Servicer and the
Trustee, at any time and from time to time, without the consent of the
Certificateholders, may amend the Pooling Agreement to modify, eliminate or add
to any of its provisions to such extent as shall be necessary to maintain the
qualification of the Trust REMIC as two separate REMICs or of the Grantor Trust
as a grantor trust, or to prevent the imposition of any additional material
state or local taxes, at all times that any Certificates are outstanding;
provided, however, that such action, as evidenced by an Opinion of Counsel
(obtained at the expense of the Trust Fund), is necessary or helpful to maintain
such qualification or to prevent the imposition of any such taxes, and would not
adversely affect in any material respect the interest of any Certificateholder.
The Pooling Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates evidencing not less than
66-2/3% of the Percentage Interests of each Class of Certificates affected by
the amendment for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Pooling Agreement or of
modifying in any manner the rights of the Certificateholders; provided, however,
that no such amendment shall:
(i) reduce in any manner the amount of, or delay the
timing of, payments received on Mortgage Loans which
are required to be distributed on any Certificate
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any
action or inaction under the Pooling Agreement,
without the consent of all the Holders of all
Certificates representing all Percentage Interests of
the Class or Classes affected thereby;
(iii) alter the Servicing Standard or the obligations of
the Master Servicer, the Special Servicer or the
Trustee to make a P&I Advance or Property Advance
without the consent of the Holders of all
Certificates representing all of the Percentage
Interests of the Class or Classes affected thereby;
or
(iv) amend any section of the Pooling Agreement which
relates to the amendment thereof, without the consent
of all the Holders of all Certificates representing
all Percentage Interests of the Class or Classes
affected thereby.
The Depositor may effect an early termination of the Trust Fund, upon not
less than 30 days' prior notice given to the Trustee and Master Servicer any
time on or after the Early Termination Notice Date (defined as any date as of
which the aggregate Stated Principal Balance of the Mortgage Loans is less than
1.0% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Cut-Off Date) specifying the Anticipated Termination Date, by purchasing on such
date all, but not less than all, of the Mortgage Loans then included in the
Trust Fund, and all property acquired in respect of any Mortgage Loan, at a
purchase price, payable in cash, equal to not less than the greater of:
(i) the sum of
(A) 100% of the unpaid principal balance of each
Mortgage Loan, included in the Trust Fund as of
the last day of the month preceding such
Distribution Date;
(B) the fair market value of all other property
included in the Trust Fund as of the last day
of the month preceding such Distribution Date,
as determined by an Independent appraiser
acceptable to the Master Servicer as of the
date not more than 30 days prior to the last
day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal
balance of each such Mortgage Loan (including
for this purpose any Mortgage Loan as to which
title to the related Mortgaged Property has
been acquired) at the Mortgage Rate (plus the
Excess Rate, to the extent applicable) to the
last day of the Interest Accrual Period
preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Property
Advances, and unpaid Servicing Fees, Special
Servicing Compensation, Trustee Fees and Trust
Fund expenses, in each case to the extent
permitted under the Pooling Agreement with
interest on all unreimbursed Advances at the
Advance Rate; and
(ii) the aggregate fair market value of the Mortgage Loans, and all other
property acquired in respect of any Mortgage Loan in the Trust Fund,
on the last day of the month preceding such Distribution Date, as
determined by an Independent appraiser acceptable to the Master
Servicer as of a date not more than 30 days prior to the last day of
the month preceding such Distribution Date, together with one month's
interest thereon at the related Mortgage Rates.
The Master Servicer or, if the Master Servicer does not, any Holder of a
Class LR Certificate representing greater than a 50% Percentage Interest in such
Class, may also effect such termination as provided above if it first notifies
the Depositor, or the Depositor and the Master Servicer, respectively, through
the Trustee of its intention to do so in writing at least 30 days prior to the
Early Termination Notice Date and neither the Depositor nor the Master Servicer
as the case may be, terminates the Trust Fund as described above within such
30-day period. All costs and expenses incurred by any and all parties to this
Agreement or by the Trust Fund in connection with the purchase of the Mortgage
Loans and other assets of the Trust Fund pursuant to Section 9.01(c) of the
Pooling Agreement shall be borne by the party exercising its purchase rights
hereunder. The Trustee shall be entitled to rely conclusively on any
determination made by an Independent appraiser pursuant to Section 9.01(c) of
the Pooling Agreement.
The respective obligations and responsibilities of the Master Servicer, the
Special Servicer, the Depositor and the Trustee created by the Pooling Agreement
with respect to the Certificates (other than the obligation to make certain
payments and to send certain notices to Certificateholders as set forth in the
Pooling Agreement) shall terminate immediately following the occurrence of the
last action required to be taken by the Trustee pursuant to Article IX of the
Pooling Agreement on the Termination Date; provided, however, that in no event
shall the trust created thereby continue beyond the expiration of twenty-one
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date of the Pooling Agreement.
Unless the Certificate of Authentication on this Certificate has been
executed by the Trustee or on its behalf by the Authenticating Agent, by manual
signature, this Certificate shall not be entitled to any benefit under the
Pooling Agreement or be valid for any purpose.
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Class LR Certificate to be
duly executed.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By:--------------------------------------
Authorized Officer
Certificate of Authentication
-----------------------------
This is one of the Class LR Certificates referred to in the Pooling
Agreement.
Dated: June ---, 1998
STATE STREET BANK AND TRUST COMPANY,
not in its individual capacity but
solely as Authenticating Agent
By:--------------------------------------
Authorized Officer
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s),
assign(s) and transfer(s) unto ----------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class LR Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class LR
Certificate of the entire Percentage Interest represented by the within Class LR
Certificates to the above-named Assignee(s) and to deliver such Class LR
Certificate to the following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Date: ----------------- -----------------------------------
Signature by or on behalf of
Assignor(s)
-----------------------------------
Taxpayer Identification Number
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
- --------------------------------------------------------------------------------
Address of the Assignee(s) for the purpose of receiving notices and
distributions:
- -----------------------------------------------------------------------------
Distributions, if being made by wire transfer in immediately available
funds to ----------------- for the account of -------------------------- account
number ----------------------------.
This information is provided by --------------------------------- the
Assignee(s) named above, or ------------------------------------- as its (their)
agent.
By: ------------------------------------
------------------------------------
[Please print or type name(s)]
------------------------------------
Title:
------------------------------------
Taxpayer Identification Number
<PAGE>
EXHIBIT B
MORTGAGE LOAN SCHEDULE
<TABLE>
<CAPTION>
Original Cut-Off
MS Loan Principal Date
Num Number Loan Name Borrower's Name Balance Principal Balance
<S> <C> <C> <C> <C> <C>
13 1 Hotel Del Coronado L-O Coronado Holding II, Inc. 166,000,000 164,947,035
43 2 CenterAmerica Pool CenterAmerica Capital Partnership, L.P. 163,000,000 163,000,000
87 3 Wells Fargo Tower North Tower, LLC 144,000,000 143,855,648
22 4 West Town Mall West Town Mall Joint Venture 76,000,000 76,000,000
5 Magellan Apartment Pool Magellan Apartment Pool 75,500,000 75,113,551
Magellan Acacia Park Limited Partnership - -
Magellan Bradbury Place Limited Partnership - -
Magellan Canterbury Hills Limited Partnership - -
Magellan Dobson Springs Limited Partnership - -
Magellan El Royale Limited Partnership - -
Magellan Harbor Grand Limited Partnership - -
Magellan Las Palmas Limited Partnership - -
Magellan Maryland Meadows Limited Partnership - -
Magellan Northwood Village Limited Partnership - -
Magellan Rancho De Las Brisas Limited Partnership - -
23 Magellan Sea Bluffs Limited Partnership - -
2 6 Glenborough Pool Glenborough Fund V, Limited Partnership 60,000,000 59,465,982
37 7 EQR Apartment Pool EQR-Flatlands, L.L.C. 50,000,000 50,000,000
35 8 Charlestowne Mall Charlestowne Mall, L.L.C. 50,000,000 50,000,000
14 9 Ramco-Gershenson Pool Ramco Properties Associates
Limited Partnership 50,000,000 49,761,281
1 10 Courthouse Plaza I Courthouse Plaza Associates
Limited Partnership 48,900,000 48,704,653
36 11 Quail Springs Mall Dajay Associates 45,000,000 45,000,000
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Original
MS Loan Original Remaining Amort
Num Number Loan Name Borrower's Name Term Term Term
<S> <C> <C> <C>
13 1 Hotel Del Coronado L-O Coronado Holding II, Inc. 120 115 300
43 2 CenterAmerica Pool CenterAmerica Capital Partnership, L.P. 120 120 360
87 3 Wells Fargo Tower North Tower, LLC 84 83 300
22 4 West Town Mall West Town Mall Joint Venture 126 119 NA
5 Magellan Apartment Pool Magellan Apartment Pool 120 113 360
Magellan Acacia Park Limited Partnership - - -
Magellan Bradbury Place Limited Partnership - - -
Magellan Canterbury Hills Limited Partnership - - -
Magellan Dobson Springs Limited Partnership - - -
Magellan El Royale Limited Partnership - - -
Magellan Harbor Grand Limited Partnership - - -
Magellan Las Palmas Limited Partnership - - -
Magellan Maryland Meadows Limited Partnership - - -
Magellan Northwood Village Limited Partnership - - -
Magellan Rancho De Las Brisas Limited Partnership - - -
23 Magellan Sea Bluffs Limited Partnership - - -
2 6 Glenborough Pool Glenborough Fund V, Limited Partnership 120 112 298
37 7 EQR Apartment Pool EQR-Flatlands, L.L.C. 120 119 NA
35 8 Charlestowne Mall Charlestowne Mall, L.L.C. 84 81 360
14 9 Ramco-Gershenson Pool Ramco Properties Associates
Limited Partnership 120 114 360
1 10 Courthouse Plaza I Courthouse Plaza Associates
Limited Partnership 120 115 360
36 11 Quail Springs Mall Dajay Associates 120 120 360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Remaining
MS Loan Amort
Num Number Loan Name Borrower's Name Term Monthly Payment
<S> <C> <C> <C>
13 1 Hotel Del Coronado L-O Coronado Holding II, Inc. 295 1,162,685
43 2 CenterAmerica Pool CenterAmerica Capital Partnership, L.P. 360 1,048,562
87 3 Wells Fargo Tower North Tower, LLC 299 1,033,432
22 4 West Town Mall West Town Mall Joint Venture NA 437,000
5 Magellan Apartment Pool Magellan Apartment Pool 353 516,580
Magellan Acacia Park Limited Partnership - -
Magellan Bradbury Place Limited Partnership - -
Magellan Canterbury Hills Limited Partnership - -
Magellan Dobson Springs Limited Partnership - -
Magellan El Royale Limited Partnership - -
Magellan Harbor Grand Limited Partnership - -
Magellan Las Palmas Limited Partnership - -
Magellan Maryland Meadows Limited Partnership - -
Magellan Northwood Village Limited Partnership - -
Magellan Rancho De Las Brisas Limited Partnership - -
23 Magellan Sea Bluffs Limited Partnership - -
2 6 Glenborough Pool Glenborough Fund V, Limited Partnership 290 442,882
37 7 EQR Apartment Pool EQR-Flatlands, L.L.C. NA 282,917
35 8 Charlestowne Mall Charlestowne Mall, L.L.C. 357 357,515
14 9 Ramco-Gershenson Pool Ramco Properties Associates
Limited Partnership 354 326,962
1 10 Courthouse Plaza I Courthouse Plaza Associates
Limited Partnership 355 331,596
36 11 Quail Springs Mall Dajay Associates 360 293,966
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MS Loan
Num Number Loan Name Borrower's Name Mortgage Rate Default Rate Excess Rate
<S> <C> <C> <C> <S> <S> <S>
13 1 Hotel Del Coronado L-O Coronado Holding II, Inc. 6.90% 11.90% 2.00%
43 2 CenterAmerica Pool CenterAmerica Capital Partnership, L.P. 6.67% 11.67% 2.00%
87 3 Wells Fargo Tower North Tower, LLC 7.17% 11.17% 2.00%
22 4 West Town Mall West Town Mall Joint Venture 6.90% 9.90% 2.00%
5 Magellan Apartment Pool Magellan Apartment Pool 7.28% 12.28% 2.00%
Magellan Acacia Park Limited Partnership - - -
Magellan Bradbury Place Limited Partnership - - -
Magellan Canterbury Hills Limited Partnership - - -
Magellan Dobson Springs Limited Partnership - - -
Magellan El Royale Limited Partnership - - -
Magellan Harbor Grand Limited Partnership - - -
Magellan Las Palmas Limited Partnership - - -
Magellan Maryland Meadows Limited Partnership - - -
Magellan Northwood Village Limited Partnership - - -
Magellan Rancho De Las Brisas Limited Partnership - - -
23 Magellan Sea Bluffs Limited Partnership - - -
2 6 Glenborough Pool Glenborough Fund V, Limited Partnership 7.50% 12.50% 2.00%
37 7 EQR Apartment Pool EQR-Flatlands, L.L.C. 6.79% 11.79% 2.00%
35 8 Charlestowne Mall Charlestowne Mall, L.L.C. 7.73% 12.73% 2.00%
14 9 Ramco-Gershenson Pool Ramco Properties Associates
Limited Partnership 6.83% 11.83% 2.00%
1 10 Courthouse Plaza I Courthouse Plaza Associates
Limited Partnership 7.19% 12.19% 2.00%
36 11 Quail Springs Mall Dajay Associates 6.82% 9.82% 2.00%
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MS Loan Revised Net
Num Number Loan Name Borrower's Name Mortgage Rate Mortgage Rate
<S> <C> <C> <C> <C> <C>
13 1 Hotel Del Coronado L-O Coronado Holding II, Inc. 8.90% 6.87%
43 2 CenterAmerica Pool CenterAmerica Capital Partnership, L.P. 8.67% 6.64%
87 3 Wells Fargo Tower North Tower, LLC 9.17% 7.14%
22 4 West Town Mall West Town Mall Joint Venture 8.90% 6.87%
5 Magellan Apartment Pool Magellan Apartment Pool 9.28% 7.25%
Magellan Acacia Park Limited Partnership - -
Magellan Bradbury Place Limited Partnership - -
Magellan Canterbury Hills Limited Partnership - -
Magellan Dobson Springs Limited Partnership - -
Magellan El Royale Limited Partnership - -
Magellan Harbor Grand Limited Partnership - -
Magellan Las Palmas Limited Partnership - -
Magellan Maryland Meadows Limited Partnership - -
Magellan Northwood Village Limited Partnership - -
Magellan Rancho De Las Brisas Limited Partnership - -
23 Magellan Sea Bluffs Limited Partnership - -
2 6 Glenborough Pool Glenborough Fund V, Limited Partnership 9.50% 7.47%
37 7 EQR Apartment Pool EQR-Flatlands, L.L.C. 8.79% 6.76%
35 8 Charlestowne Mall Charlestowne Mall, L.L.C. 9.73% 7.70%
14 9 Ramco-Gershenson Pool Ramco Properties Associates
Limited Partnership 8.83% 6.80%
1 10 Courthouse Plaza I Courthouse Plaza Associates
Limited Partnership 9.19% 7.16%
36 11 Quail Springs Mall Dajay Associates 8.82% 6.79%
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MS Loan Servicing Day Count
Num Number Loan Name Borrower's Name Fee Rate Convention
<S> <C> <C> <C> <C> <C>
13 1 Hotel Del Coronado L-O Coronado Holding II, Inc. 0.0280% 30/360
43 2 CenterAmerica Pool CenterAmerica Capital Partnership, L.P. 0.0280% Act/360
87 3 Wells Fargo Tower North Tower, LLC 0.0280% Act/360
22 4 West Town Mall West Town Mall Joint Venture 0.0280% 30/360
5 Magellan Apartment Pool Magellan Apartment Pool 0.0280% Act/360
Magellan Acacia Park Limited Partnership - -
Magellan Bradbury Place Limited Partnership - -
Magellan Canterbury Hills Limited Partnership - -
Magellan Dobson Springs Limited Partnership - -
Magellan El Royale Limited Partnership - -
Magellan Harbor Grand Limited Partnership - -
Magellan Las Palmas Limited Partnership - -
Magellan Maryland Meadows Limited Partnership - -
Magellan Northwood Village Limited Partnership - -
Magellan Rancho De Las Brisas Limited Partnership - -
23 Magellan Sea Bluffs Limited Partnership - -
2 6 Glenborough Pool Glenborough Fund V, Limited Partnership 0.0330% Act/360
37 7 EQR Apartment Pool EQR-Flatlands, L.L.C. 0.0280% Act/360
35 8 Charlestowne Mall Charlestowne Mall, L.L.C. 0.0280% Act/360
14 9 Ramco-Gershenson Pool Ramco Properties Associates 0.0280% Act/360
Limited Partnership
1 10 Courthouse Plaza I Courthouse Plaza Associates 0.0280% 30/360
Limited Partnership
36 11 Quail Springs Mall Dajay Associates 0.0280% Act/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
MS Loan Cut-Off Number of
Num Number Loan Name Borrower's Name LTV Properties
<S> <C> <C> <C> <C> <C>
13 1 Hotel Del Coronado L-O Coronado Holding II, Inc. 49.98% 1
43 2 CenterAmerica Pool CenterAmerica Capital Partnership, L.P. 61.26% 44
87 3 Wells Fargo Tower North Tower, LLC 61.22% 1
22 4 West Town Mall West Town Mall Joint Venture 47.50% 1
5 Magellan Apartment Pool Magellan Apartment Pool 79.25% 11
Magellan Acacia Park Limited Partnership - -
Magellan Bradbury Place Limited Partnership - -
Magellan Canterbury Hills Limited Partnership - -
Magellan Dobson Springs Limited Partnership - -
Magellan El Royale Limited Partnership - -
Magellan Harbor Grand Limited Partnership - -
Magellan Las Palmas Limited Partnership - -
Magellan Maryland Meadows Limited Partnership - -
Magellan Northwood Village Limited Partnership - -
Magellan Rancho De Las Brisas Limited Partnership - -
23 Magellan Sea Bluffs Limited Partnership - -
2 6 Glenborough Pool Glenborough Fund V, Limited Partnership 51.31% 10
37 7 EQR Apartment Pool EQR-Flatlands, L.L.C. 49.68% 5
35 8 Charlestowne Mall Charlestowne Mall, L.L.C. 57.74% 1
14 9 Ramco-Gershenson Pool Ramco Properties Associates
Limited Partnership 64.63% 7
1 10 Courthouse Plaza I Courthouse Plaza Associates
Limited Partnership 70.48% 1
36 11 Quail Springs Mall Dajay Associates 52.66% 1
</TABLE>
<PAGE>
EXHIBIT C-1
AFFIDAVIT PURSUANT TO SECTION 860E(e)(4) OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
-----------------------, being first duly sworn, deposes and says:
1. That he/she is a -------------------- of --------------------- (the
"Purchaser"), a ---------------- duly organized and existing under the laws of
the State of -------------, on behalf of which he makes this affidavit.
2. That the Purchaser's Taxpayer Identification Number is ----------------.
3. That the Purchaser of the Morgan Stanley Capital I Inc., Commercial
Mortgage Pass-Through Certificates, Series 1998-XL I, Class [R] [LR] (the "Class
[R] [LR] Certificate") is a Permitted Transferee (as defined in Article I of the
Pooling and Servicing Agreement, dated as of June 1, 1998, by and among Morgan
Stanley Capital I Inc., as Depositor, Midland Loan Services, Inc., as Master
Servicer, Clarion Partners, LLC, as Special Servicer and State Street Bank and
Trust Company, as Trustee (the "Pooling and Servicing Agreement"), or is
acquiring the Class [R] [LR] Certificate for the account of, or as agent
(including as a broker, nominee, or other middleman) for, a Permitted Transferee
and has received from such person or entity an affidavit substantially in the
form of this affidavit.
4. That the Purchaser historically has paid its debts as they have come due
and intends to pay its debts as they come due in the future and the Purchaser
intends to pay taxes associated with holding the Class [R] [LR] Certificate as
they become due.
5. That the Purchaser understands that it may incur tax liabilities with
respect to the Class [R] [LR] Certificate in excess of any cash flow generated
by the Class [R] [LR] Certificate.
6. That the Purchaser will not transfer the Class [R] [LR] Certificate to
any person or entity from which the Purchaser has not received an affidavit
substantially in the form of this affidavit or as to which the Purchaser has
actual knowledge that the requirements set forth in paragraph 3, paragraph 4 or
paragraph 7 hereof are not satisfied or that the Purchaser has reason to know
does not satisfy the requirements set forth in paragraph 4 hereof.
7. That the Purchaser is not a Disqualified Non-U.S. Person and is not
purchasing the Class [R] [LR] Certificate for the account of, or as an agent
(including as a broker, nominee or other middleman) for, a Disqualified Non-U.S.
Person.
8. That the Purchaser agrees to such amendments of the Pooling and
Servicing Agreement as may be required to further effectuate the restrictions on
transfer of the Class [R] [LR] Certificate to such a "disqualified
organization," an agent thereof, or a person that does not satisfy the
requirements of paragraph 4 and paragraph 7 hereof.
9. That, if a "tax matters person" is required to be designated with
respect to the [Upper-Tier REMIC] [Lower-Tier REMIC], the Purchaser agrees to
act as "tax matters person" and to perform the functions of "tax matters person"
of the [Upper-Tier REMIC] [Lower-Tier REMIC] pursuant to Section 4.04 of the
Pooling and Servicing Agreement, and agrees to the irrevocable designation of
the Trustee as the Purchaser's agent in performing the function of "tax matters
person."
10. The Purchaser agrees to be bound by and to abide by the provisions of
Section 5.02 of the Pooling and Servicing Agreement concerning registration of
the transfer and exchange of the Class [R] [LR] Certificate.
Capitalized terms used but not defined herein have the respective meanings
ascribed to such terms in the Pooling and Servicing Agreement.
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be executed
on its behalf by its -------------------- this ---th day of ----------, 199--.
[Purchaser]
By:-------------------------------
Title:----------------------------
Name:-----------------------------
<PAGE>
The above-named -------------------- personally appeared before me and is
known or proved to me to be the same person who executed the foregoing
instrument and to be the ----------------- of the Purchaser, 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 Purchaser.
Subscribed and sworn before me this --th day of -----------------, 199-.
NOTARY PUBLIC
COUNTY OF
STATE OF
My commission expires the --th day
of ---------------, 199-.
<PAGE>
EXHIBIT C-2
FORM OF TRANSFEROR LETTER
[Date]
[CERTIFICATE REGISTRAR]
Re: Morgan Stanley Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 1998-XL1
Ladies and Gentlemen:
[Transferor] has reviewed the attached affidavit of [Transferee], and has
no actual knowledge that such affidavit is not true and has no reason to know
that the information contained in paragraph 4 thereof is not true.
Very truly yours,
----------------------
<PAGE>
EXHIBIT D-1
FORM OF INVESTMENT REPRESENTATION LETTER
State Street Bank and Trust Company, as Trustee
and Certificate Registrar
Corporate Trust Department - 5th Floor
Two International Place
Boston, Massachusetts 02110
Attn: Morgan Stanley Series 1998-XL1
Morgan Stanley Capital I Inc.
1585 Broadway
New York, New York 10036
Attention:----------------
Re: Transfer of Morgan Stanley Capital I Inc.,Commercial
Mortgage Pass-Through Certificates, Series 1998-XL1,
Class[ ]
Ladies and Gentlemen:
This letter is delivered pursuant to Section 5.02 of the Pooling and
Servicing Agreement, dated as of June 1, 1998 (the "Pooling and Servicing
Agreement"), by and among Morgan Stanley Capital I Inc., as Depositor, Midland
Loan Services, Inc., as Master Servicer, Clarion Partners, LLC, as Special
Servicer and State Street Bank and Trust Company, as Trustee, on behalf of the
holders of Morgan Stanley Capital I Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-XL1 (the "Certificates") in connection with the
transfer by ---------------- (the "Seller") to the undersigned (the "Purchaser")
of $---------------- aggregate Certificate Principal Amount of Class [-]
Certificates, in certificated fully registered form, or, if applicable, a
beneficial interest of such aggregate Certificate Principal Amount in a Private
Global Certificate (either such interest, the "Transferred Interest"). Terms
used but not defined herein shall have the meanings ascribed thereto in the
Pooling and Servicing Agreement.
In connection with such transfer, the undersigned hereby represents and
warrants to you as follows:
[[For Institutional Accredited Investors only.]
1. We are an "institutional accredited investor" (an entity meeting the
requirements of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the
Securities Act (as defined below)) and have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of our investment in the Transferred Interest, and we and any accounts for
which we are acting are each able to bear the economic risk of our or its
investment. We are acquiring the Transferred Interest purchased by us for our
own account or for one or more accounts (each of which is an "institutional
accredited investor") as to each of which we exercise sole investment
discretion. The Purchaser hereby undertakes to reimburse the Trust for any costs
incurred by it in connection with this transfer.]
[[For Qualified Institutional Buyers only.]
1. The Purchaser is a "qualified institutional buyer" within the meaning of
Rule 144A (as defined below) promulgated under the Securities Act (as defined
below). The Purchaser is aware that the transfer is being made in reliance on
Rule 144A, and the Purchaser has had the opportunity to obtain the information
required to be provided pursuant to paragraph (d)(4)(i) of Rule 144A.]
2. The Purchaser's intention is to acquire the Transferred Interest (a) for
investment for the Purchaser's own account or (b) for resale to (i) "qualified
institutional buyers" in transactions under Rule 144A ("Rule 144A") promulgated
under the Securities Act of 1933 (the "Securities Act") or (ii) to
"institutional accredited investors" meeting the requirements of Rule 501(a)(1),
(2), (3) or (7) of Regulation D promulgated under the Securities Act, if the
Purchaser is a "qualified institutional buyer", or pursuant to an exemption from
the registration requirements of the Securities Act provided by Rule 144A under
the Securities Act (if applicable), subject in the case of this clause (ii) and
to (a) the receipt by the Certificate Registrar of a letter substantially in the
form hereof, (b) the receipt by the Certificate Registrar of an opinion of
counsel acceptable to the Certificate Registrar that such reoffer, resale,
pledge or transfer is in compliance with the Securities Act, and (c) a written
undertaking to reimburse the Trust for any costs incurred by it in connection
with the proposed transfer. It understands that the Transferred Interest has not
been registered under the Securities Act, by reason of a specified exemption
from the registration provisions of the Securities Act which may depend upon,
among other things, the bona fide nature of the Purchaser's investment intent
(or intent to resell to only certain investors in certain exempted transactions)
as expressed herein.
3. The Purchaser acknowledges that the Transferred Interest has not been
registered or qualified under the Securities Act or the securities laws of any
State or any other jurisdiction, and that the Transferred Interest cannot be
resold unless it is registered or qualified thereunder or unless an exemption
from such registration or qualification is available.
4. The Purchaser hereby undertakes to be bound by the terms and conditions
of the Pooling and Servicing Agreement in its capacity as an owner of the
Transferred Interest in all respects as if it were a signatory thereto. This
undertaking is made for the benefit of the Trust, the Certificate Registrar and
all Certificateholders present and future.
5. The Purchaser will not sell or otherwise transfer any portion of the
Transferred Interest, except in compliance with Section 5.02 of the Pooling and
Servicing Agreement.
6. Check one of the following:*
- ------------
[FN]
* Each Purchaser must include on of the two alternative certifications.
------- The Purchaser is a "U.S. Person" and it has attached hereto an
Internal Revenue Service ("IRS") Form W-9 (or successor form).
------- The Purchaser is not a "U.S. Person" and under applicable law in
effect on the date hereof, no Taxes will be required to be withheld by the
Certificate Registrar (or its agent) with respect to Distributions to be made on
the Transferred Interest. The Purchaser has attached hereto either (i) a duly
executed IRS Form W-8 (or successor form), which identifies such Purchaser as
the beneficial owner of the Transferred Interest and states that such Purchaser
is not a U.S. Person or (ii) two duly executed copies of IRS Form 4224 (or
successor form), which identify such Purchaser as the beneficial owner of the
Transferred Interest and state that interest and original issue discount on the
Transferred Interest is, or is expected to be, effectively connected with a U.S.
trade or business. The Purchaser agrees to provide to the Certificate Registrar
updated IRS Forms W-8 or IRS Forms 4224, as the case may be, any applicable
successor IRS forms, or such other certifications as the Certificate Registrar
may reasonably request, on or before the date that any such IRS form or
certification expires or becomes obsolete, or promptly after the occurrence of
any event requiring a change in the most recent IRS form of certification
furnished by it to the Certificate Registrar.
For this purpose, "U.S. Person" means a citizen or resident of the United
States for U.S. federal income tax purposes, a corporation, partnership (except
to the extent provided in applicable Treasury regulations) or other entity
created or organized in or under the laws of the United States or any of its
political subdivisions, or an estate the income of which is subject to U.S.
federal income taxation regardless of its source or a trust if a court within
the United States is able to exercise privacy supervision over the
administration of the trust and one or more such U.S. Persons have the authority
to control all substantial decisions of the trust (or, to the extent provided in
applicable Treasury regulations, certain trusts in existence on August 20, 1996
which are eligible to elect to be treated as U.S. Persons.
<PAGE>
Please make all payments due on the Transferred Interests:**
- ------------
[FN]
** Only to be filled out by Purchasers of Individual Certificates. Please
select (a) or (b).
------ (a) by wire transfer to the following account at a bank or entity in
New York, New York, having appropriate facilities therefor:
Account number ---------- Institution -----------
------ (b) by mailing a check or draft to the following address:
-------------------------
-------------------------
-------------------------
-------------------------
---------------
Very truly yours,
[The Purchaser]
By: ---------------------------------------
Name: -------------------------------------
Title: ------------------------------------
<PAGE>
EXHIBIT D-2
FORM OF ERISA REPRESENTATIONS LETTER
State Street Bank and Trust Company, as Trustee
and Certificate Registrar
Corporate Trust Department - 5th Floor
Two International Place
Boston, Massachusetts 02110
Attn: Morgan Stanley Series 1998-XL1
Morgan Stanley Capital I Inc.
1585 Broadway
New York, New York 10036
Attention:----------------
Re: Morgan Stanley Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 1998-XL1, Class[ ]
Ladies and Gentlemen:
-------------------------- (the "Purchaser") intends to purchase from
- -------------------- (the "Seller") $------------- initial Certificate Principal
Amount or -----% Percentage Interest of Morgan Stanley Capital I Inc.,
Commercial Mortgage Pass-Through Certificates, Series 1998-XL1, Class [-], CUSIP
No. [----] (the "Certificates"), issued pursuant to the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June 1, 1998, by
and among Morgan Stanley Capital I Inc., as Depositor, Midland Loan Services,
Inc., as Master Servicer, Clarion Partners, LLC, as Special Servicer and State
Street Bank and Trust Company, as Trustee. All capitalized terms used herein and
not otherwise defined shall have the meaning set forth in the Pooling and
Servicing Agreement.
The Purchaser hereby certifies, represents and warrants to, and covenants
with, the Seller, the Certificate Registrar and the Trustee that:
1. The Purchaser is neither (a) an employee benefit plan or other
retirement arrangement, including an individual retirement account or a Keogh
plan, which is subject to Title I of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), or Section 4975 of the Code, or a governmental
plan (as defined in Section 3(32) of ERISA) that is subject to any Federal,
State or local law (a "Similar Law"), which is to a material extent, similar to
the foregoing provisions of ERISA or the Code (each, a "Plan"), nor (b) a
collective investment fund in which such Plans are invested, an insurance
company using assets of separate accounts or general accounts which include
assets of Plans (or which are deemed pursuant to ERISA or any Similar Law to
include assets of Plans) or other Person acting on behalf of any such Plan or
using the assets of any such Plan, other than (with respect to any transfer of a
Class B, Class C, Class D, Class G or Class H Certificate) an insurance company
using assets of its general account under circumstances whereby such purchase
and the subsequent holding of such Certificate by such insurance company would
be exempt from the prohibited transaction provisions of ERISA and Section 4975
of the Code under Prohibited Transaction Class Exemption 95-60.
2. The Purchaser understands that if the Purchaser is a Person referred to
in 1(a) or 1(b) above, except in the case of the Class R or Class LR
Certificates, which may not be transferred unless the transferee represents it
is not such a Person, such Purchaser is required to provide to the Seller, the
Trustee and the Certificate Registrar an Opinion of Counsel in form and
substance satisfactory to of the Seller, the Trustee and the Certificate
Registrar that the purchase or holding of the Certificates will not result in
the assets of the Trust Fund being deemed to be "plan assets" and subject to
Title I of ERISA, Section 4975 of the Code or Similar Law, will not constitute
or result in a prohibited transaction within the meaning of ERISA or Section
4975 of the Code or a materially similar characterization under any Similar Law,
and will not subject the Master Servicer, the Special Servicer, the Seller, the
Trustee or the Certificate Registrar to any obligation or liability (including
obligations or liabilities under ERISA, Section 4975 of the Code or Similar Law)
in addition to those set forth in the Pooling and Servicing Agreement, which
Opinion of Counsel shall not be at the expense of the Trust Fund, the Master
Servicer, the Seller, the Trustee or the Certificate Registrar.
<PAGE>
IN WITNESS WHEREOF, the Purchaser hereby executes the ERISA Representation
Letter on -------------- --, 19--.
Very truly yours,
------------------------------------
By:---------------------------------
Name:-------------------------------
Title:------------------------------
<PAGE>
EXHIBIT E
FORM OF REQUEST FOR RELEASE
(for Trustee/Custodian)
Loan Information:
Name of Mortgagor: ------------------
Master Servicer Loan No.: ------------------
Custodian/Trustee
Name: ------------------
Address: ------------------
- ------------------
Custodian/Trustee Mortgage File No.: ------------------
[Seller]
Name: ------------------
Address: ------------------
- ------------------
Certificates: Morgan Stanley Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 1998-XL1
The undersigned Master Servicer hereby acknowledges that it has received
from State Street Bank and Trust Company, as Trustee for the Holders of Morgan
Stanley Capital I Inc., Commercial Mortgage Pass-Through Certificates, Series
1998-XL1, the documents referred to below (the "Documents"). All capitalized
terms not otherwise defined in this Request for Release shall have the meanings
given them in the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of June 1, 1998, by and among the Trustee, Morgan Stanley
Capital I Inc., as Depositor, Midland Loan Services, Inc., as Master Servicer
and Clarion Partners, LLC, as Special Servicer.
( ) Promissory Note dated ---------, 199--, in the original principal sum
of $-----, made by --------, payable to, or endorsed to the order of, the
Trustee.
( ) Mortgage recorded on ------------ as instrument no. -------- in the
County Recorder's Office of the County of ---------, State of ------------ in
book/reel/docket ----------- of official records at page/image --------.
( ) Deed of Trust recorded on ---------- as instrument no. --------- in the
County Recorder's Office of the County of -----------, State of -------- in
book/reel/docket ------------ of official records at page/image.
( ) Assignment of Mortgage or Deed of Trust to the Trustee, recorded on
- ------------- as instrument no. ------- in the County Recorder's Office of the
County of ---------, State of ------- in book/reel/docket ---------- of official
records at page/image -------------.
( ) Other documents, including any amendments, assignments or other
assumptions of the Note or Mortgage.
( ) ---------------------------
( ) ---------------------------
( ) ---------------------------
( ) ---------------------------
The undersigned Master Servicer hereby acknowledges and agrees as follows:
(1) The Master Servicer shall hold and retain possession of the Documents
in trust for the benefit of the Trustee, solely for the purposes provided in the
Agreement.
(2) The Master Servicer shall not cause or permit the Documents to become
subject to, or encumbered by, any claim, liens, security interest, charges,
writs of attachment or other impositions nor shall the Master Servicer assert or
seek to assert any claims or rights of set-off to or against the Documents or
any proceeds thereof.
(3) The Master Servicer shall return the Documents to the Custodian when
the need therefor no longer exists, unless the Mortgage Loan relating to the
Documents has been liquidated and the proceeds thereof have been remitted to the
Collection Account and except as expressly provided in the Agreement.
(4) The Documents and any proceeds thereof, including any proceeds of
proceeds, coming into the possession or control of the Master Servicer shall at
all times be earmarked for the account of the Trustee, and the Master Servicer
shall keep the Documents and any proceeds separate and distinct from all other
property in the Master Servicer's possession, custody or control.
MIDLAND LOAN SERVICES, INC.
By:---------------------------------
Title:------------------------------
Date:---------------- --, 19--
<PAGE>
EXHIBIT F
SECURITIES LEGEND
Subject to the Pooling and Servicing Agreement, the Rule 144A Global
Certificates, Residual Certificates and Individual Certificates will bear a
legend (the "Securities Legend") to the following effect, unless the Certificate
Registrar determines otherwise in accordance with applicable law:
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAW. THE
HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY
BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A)(1) PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF
RULE 144A (A "QIB"), WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) TO AN
INSTITUTIONAL INVESTOR THAT IS, OR ALL THE EQUITY OWNERS OF WHICH ARE,
INSTITUTIONAL "ACCREDITED INVESTORS" AS SUCH TERM IS DEFINED IN RULE
501(A)(1),(2),(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO AN
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 (IF AVAILABLE) OR (3) BY AN
INITIAL INVESTOR THAT IS A QIB, TO AN INSTITUTIONAL ACCREDITED INVESTOR AND (B)
IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES.
Notwithstanding anything to the contrary, the Residual Certificates will
not bear clause (A)(2) and clause (A)(3) of the Securities Legend.
<PAGE>
EXHIBIT G
LOAN SALE AGREEMENT
This Loan Sale Agreement, dated as of June 1, 1998 (the "Agreement"), is
between Morgan Stanley Capital I Inc., a Delaware corporation (the "Depositor"),
and Morgan Stanley Mortgage Capital Inc., a New York corporation (the "Mortgage
Loan Seller"). The Mortgage Loan Seller agrees to sell, and the Depositor agrees
to purchase the mortgage loans (the "Mortgage Loans") described and set forth in
the mortgage loan schedule attached as Exhibit A to this Agreement (the
"Mortgage Loan Schedule"). The Mortgage Loans were originated by Secore
Financial Corporation, a Pennsylvania corporation ("Secore") and Wells Fargo
Bank, National Association ("Wells Fargo", and each of Secore and Wells Fargo,
an "Originator"), and the Mortgage Loan Seller acquired each of the Mortgage
Loans on or prior to the Closing Date. The Depositor intends to deposit the
Mortgage Loans and other assets into a trust (the "Trust") and cause the
creation of a series of certificates to be known as Morgan Stanley Capital I
Inc., Commercial Mortgage Pass-Through Certificates, Series 1998-XL1 (the
"Certificates"), evidencing beneficial ownership interests in the Mortgage Loans
and the other assets, under a Pooling and Servicing Agreement, to be dated as of
June 1, 1998 (the "Pooling and Servicing Agreement"), among the Depositor, as
seller, Midland Loan Services, Inc., as master servicer (the "Master Servicer"),
Clarion Partners, LLC, as special servicer (the "Special Servicer"), State
Street Bank and Trust Company, as trustee (the "Trustee"). Capitalized terms
used but not otherwise defined herein shall have the respective meanings
ascribed to them in the Pooling and Servicing Agreement.
1. Purchase Price; Purchase and Sale. The purchase price (the "Purchase
Price") for the Mortgage Loans shall be an amount equal to 103.89429%,
multiplied by the aggregate principal balance of the Mortgage Loans as of June
1, 1998 (the "Cut-Off Date"), after application of scheduled payments of
principal due on or before the Cut-Off Date whether or not collected. In
addition to the Purchase Price as described above, the Depositor shall pay to
the Mortgage Loan Seller, at closing, accrued interest on the initial principal
amount of the related Mortgage Loans at the weighted average Mortgage Rate of
those Mortgage Loans, net of interest at the related Servicing Fee Rate. The
portion of such accrued interest that accrues at the Servicing Fee Rate is
required by the Pooling and Servicing Agreement to be remitted by the Master
Servicer, within one Business Day after its receipt of such accrued interest, to
or at the direction of the Depositor. The Depositor hereby agrees to direct the
Master Servicer to remit such portion of accrued interest to the Mortgage Loan
Seller. The Purchase Price amount shall be payable by the Depositor to the
Mortgage Loan Seller on June 11, 1998 (the "Closing Date") in immediately
available federal funds. The closing for the purchase and sale of the Mortgage
Loans shall take place at the offices of Cadwalader, Wickersham & Taft, New
York, New York, at 10:00 a.m. (New York time), on the Closing Date.
On the Closing Date, the Mortgage Loan Seller shall and does hereby sell,
transfer, assign, set over and convey to the Depositor, and the Depositor shall
and does hereby purchase all the right, title and interest of the Mortgage Loan
Seller in and to the Mortgage Loans, including all interest and principal due on
or with respect to the Mortgage Loans after the Cut-Off Date, together with all
of the Mortgage Loan Seller's right, title and interest in and to the proceeds
of any related title, hazard, primary mortgage or other insurance policies and
any related interest rate cap agreement. The Depositor hereby directs the
Mortgage Loan Seller, and the Mortgage Loan Seller hereby agrees, to deliver to
the Trustee all documents, instruments and agreements required to be delivered
by the Depositor to the Trustee under Section 2.01 of the Pooling and Servicing
Agreement, and meeting all the requirements of such Section 2.01, and such other
documents, instruments and agreements as the Depositor or the Trustee shall
reasonably request.
2. Representations and Warranties.
(a) The Mortgage Loan Seller hereby represents and warrants to the
Depositor as of the date hereof and as of the Closing Date that:
(i) The Mortgage Loan Seller is a New York corporation
duly organized, validly existing and in good standing
under the laws of the State of New York, with full
power and authority to own its assets and conduct its
business, is duly qualified as a foreign partnership
in good standing in all jurisdictions in which the
ownership or lease of its property or the conduct of
its business requires such qualification, except
where the failure to be so qualified would not have a
material adverse effect on its ability to perform its
obligations hereunder, and the Mortgage Loan Seller
has taken all necessary action to authorize the
execution, delivery and performance of this Agreement
by it, and has the power and authority to execute,
deliver and perform under this Agreement and all the
transactions contemplated hereby, including, but not
limited to, the power and authority to sell, assign,
transfer, set over and convey the Mortgage Loans in
accordance with this Agreement;
(ii) This Agreement has been duly authorized, executed and
delivered by the Mortgage Loan Seller and assuming
its due authorization, execution and delivery by the
Depositor, will constitute a legal, valid and binding
obligation of the Mortgage Loan Seller, enforceable
against the Mortgage Loan Seller in accordance with
its terms, except as such enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting the enforcement of
creditors' rights generally, and by general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in
equity or at law);
(iii) The execution and delivery of this Agreement by the
Mortgage Loan Seller and the performance of its
obligations hereunder will not conflict with any
provision of any law or regulation to which the
Mortgage Loan Seller is subject, or conflict with,
result in a breach of, or constitute a default under,
any of the terms, conditions or provisions of any of
the Mortgage Loan Seller's organizational documents
or any agreement or instrument to which the Mortgage
Loan Seller is a party or by which it is bound, or
any order or decree applicable to the Mortgage Loan
Seller, or result in the creation or imposition of
any lien on any of the Mortgage Loan Seller's assets
or property, in each case which would materially and
adversely affect the ability of the Mortgage Loan
Seller to carry out the transactions contemplated by
this Agreement;
(iv) There is no action, suit, proceeding or investigation
pending or, to the Mortgage Loan Seller's knowledge,
threatened against the Mortgage Loan Seller in any
court or by or before any other governmental agency
or instrumentality which would materially and
adversely affect the validity of the Mortgage Loans
or the ability of the Mortgage Loan Seller to carry
out the transactions contemplated by this Agreement;
(v) The Mortgage Loan Seller is not in default with
respect to any order or decree of any court or any
order, regulation or demand of any federal, state,
municipal or governmental agency, which default might
have consequences that would materially and adversely
affect the condition (financial or other) or
operations of the Mortgage Loan Seller or its
properties or might have consequences that would
materially and adversely affect its performance
hereunder;
(vi) No consent, approval, authorization or order of any
court or governmental agency or body is required for
the execution, delivery and performance by the
Mortgage Loan Seller of, or compliance by the
Mortgage Loan Seller with, this Agreement or the
consummation of the transactions contemplated hereby,
other than those which have been obtained by the
Mortgage Loan Seller; and
(vii) The transfer, assignment and conveyance of the
Mortgage Loans by the Mortgage Loan Seller to the
Depositor is not subject to bulk transfer laws or any
similar statutory provisions in effect in any
applicable jurisdiction.
(b) For purposes of the representations and warranties in this Section
2(b), the date of origination of each of the Wells Fargo Tower Loan and the
Glenborough Pool Loan is the date on which the Mortgage Loan Seller took an
assignment of the existing note and mortgage from the prior lender. The Mortgage
Loan Seller hereby represents and warrants with respect to each Mortgage Loan
that, as of the date specified below or, if no such date is specified, as of the
Closing Date (except as may be specified in the related representation and
warranty or on Schedule 1 hereto):
(i) The information set forth in the mortgage loan
schedule attached to the Loan Sale Agreement as to
the Mortgage Loan is complete, true and correct in
all material respects;
(ii) The Mortgage Loan Seller is the sole owner and holder
of the Mortgage Loan and has good and marketable
title thereto, has full right, power and authority to
sell and assign such Mortgage Loan free and clear of
any interest or claim of a third party;
(iii) The Mortgage Loan has not been since the date of
origination by the applicable Originator, and
currently is not, thirty or more days delinquent, and
the mortgagor is not in default thereunder beyond any
applicable grace period for the payment of any
obligation to pay principal and interest, taxes,
insurance premiums and required reserves;
(iv) The Mortgage Loan Seller has not advanced funds, or
knowingly received any advance of funds from a party
other than the mortgagor subject to the related
Mortgage, directly or indirectly, for the payment of
any amount required by the Mortgage Loan;
(v) (A) The Mortgage Loan documents have been duly and
properly executed, and (B) the Mortgage Loan
documents are legal, valid and binding obligations of
the mortgagor, and their terms are enforceable
against the mortgagor, subject only to bankruptcy,
insolvency, moratorium, fraudulent transfer,
fraudulent conveyance and similar laws affecting
rights of creditors generally and to the application
of general principles of equity and there is no valid
defense, counterclaim, or right of rescission or
right of set-off or abatement available to any
mortgagor under the Mortgage Loan documents;
(vi) The lien of each Mortgage is insured by an ALTA
lender's title insurance policy or its equivalent as
adopted in the applicable jurisdiction issued by one
or more nationally recognized title insurance
companies, insuring the Originator, its successors
and assigns, as to the first priority lien of the
Mortgage in the original principal amount of the
Mortgage Loan after all advances of principal,
subject only to (a) the lien of current real property
taxes, ground rents, water charges, sewer rents and
assessments not yet due and payable, (b) covenants,
conditions and restrictions, rights of way, easements
and other matters of public record, none of which,
individually or in the aggregate, in the reasonable
judgment of the Mortgage Loan Seller, materially
interferes with the current use of the related
Mortgaged Property or the security intended to be
provided by such Mortgage or with the mortgagor's
ability to pay its obligations when they become due
or the value of the related Mortgaged Property and
(c) the exceptions (general and specific) set forth
in such policy, none of which, individually or in the
aggregate, in the reasonable judgment of the Mortgage
Loan Seller, materially interferes with the current
use of the related Mortgaged Property or security
intended to be provided by such Mortgage, with the
mortgagor's ability to pay its obligations when they
become due or the value of the related Mortgaged
Property (or if a title insurance policy has not yet
been issued in respect of the Mortgage Loan, a policy
meeting the foregoing description is evidenced by a
commitment for title insurance "marked-up" at the
closing of the Mortgage Loan) and none of which
relate to matters on the survey of the related
Mortgaged Property which are material. To the actual
knowledge of the Mortgage Loan Seller, no material
claims have been made under such title policy;
(vii) As of the date of origination of the Mortgage Loan
there were no, and to the best knowledge of the
Mortgage Loan Seller there are no, mechanics',
materialman's or other similar liens or claims which
have been filed for work, labor or materials
affecting the Mortgaged Property which are or may be
liens prior to, or equal or coordinate with, the lien
of the Mortgage, unless such lien is insured against
under the related title insurance policy and there is
no subordinate debt secured by the Mortgaged Property
except as disclosed in the Prospectus Supplement;
(viii) (A) Each building or other improvement locate on any
Mortgaged Property was insured by a fire and extended
perils insurance policy, issued by an insurer or
reinsured by an insurer meeting the requirements of
the Mortgage Loan documents, in an amount not less
than the replacement cost of the Mortgaged Property;
each Mortgaged Property was also covered by business
interruption insurance and comprehensive general
liability insurance in amounts generally required by
institutional lenders for similar properties; all
premiums on such insurance policies required to be
paid as of the date hereof have been paid; such
insurance policies require prior notice to the
insured of termination or cancellation, and no such
notice has been received; and (B) the loan documents
obligate the mortgagor to maintain all such insurance
and, at the mortgagor's failure to do so, authorize
the mortgagee to maintain such insurance at the
mortgagor's cost and expense and to seek
reimbursement therefor from such mortgagor;
(ix) As of the most recent date of inspection of each
Mortgaged Property by the Mortgage Loan Seller, based
solely on the Mortgage Loan Seller's review of the
report prepared by the engineer who inspected the
structure, exterior walls, roofing, interior
construction, mechanical and electrical systems and
general conditions of the site, buildings and other
improvements with respect to the Mortgage Loan (which
report indicated, where appropriate, a variety of
deferred maintenance items and recommended capital
improvements with respect to such Mortgaged Property,
as well as the estimated cost of such items and
improvements and the most recent visual inspection
(as described in (xviii) below) of the Mortgaged
Property, no building or other improvement on any
Mortgaged Property has been affected in any material
manner or suffered any material loss as a result of
any fire, wind, explosion, accident, riot, war, or
act of God or the public enemy, and each Mortgaged
Property is free of any material damage that would
affect materially and adversely the value of the
Mortgaged Property as security for the Mortgage Loan
and is in good repair. The Mortgage Loan Seller has
neither received notice, nor is otherwise aware, of
any proceedings pending for the total condemnation of
any Mortgaged Property or a partial condemnation of
any portion material to the borrower's ability to
perform its obligations under its related Mortgage
Loan;
(x) To the Mortgage Loan Seller's best knowledge, after
review of compliance confirmations from applicable
municipalities, surveys and/or title insurance
endorsements, none of the improvements included for
the purpose of determining the appraised value of
each Mortgaged Property at the time of the
origination of the Mortgage Loan lies outside of the
boundaries and building restriction lines of the
Mortgaged Property, and no improvements on adjoining
properties materially encroach upon the Mortgaged
Property except those which are insured against by
the title insurance policy (including endorsements
thereto) issued in connection with the Mortgage Loan
and all improvements on the Mortgaged Property comply
with the applicable zoning laws and/or set-back
ordinances in force when improvements were added;
(xi) The Mortgage Loan does not violate applicable usury
laws;
(xii) Since the date of origination of the Mortgage Loan,
the terms of the Mortgage Loan have not been
impaired, waived, altered, satisfied, canceled,
subordinated or modified in any respect (except with
respect to modifications the economic terms of which
are reflected in the mortgage loan schedule and which
are evidenced by documents in the Mortgage Loan file
delivered to the Trustee) and no portion of the
Mortgaged Property has been released from the lien of
the Mortgage in any manner;
(xiii) All applicable mortgage recording taxes and other
filing fees have been paid in full or deposited with
the issuer of the title insurance policy issued in
connection with the Mortgage Loan for payment upon
recordation of the relevant documents;
(xiv) Each assignment of leases and rents, if any, creates
a valid assignment of, or a valid security interest
in, certain rights under the related leases, subject
only to a license granted to the relevant mortgagor
to exercise certain rights and to perform certain
obligations of the lessor under such leases,
including the right to operate the related Mortgaged
Property, subject only to those exceptions described
in clause (vi) above. To the best of the Mortgage
Loan Seller's knowledge and without affirmative
investigation, no person other than the relevant
mortgagor owns any interest in any payments due under
such leases that is superior to or of equal priority
with the mortgagee's interest therein, subject only
to those exceptions described in clause (vi) above;
(xv) Each Mortgage, upon due recordation, is a valid and
enforceable first lien on the related Mortgaged
Property, subject only to those exceptions described
in clause (vi) above;
(xvi) The Mortgage Loan Seller has not taken any action,
nor has knowledge that the mortgagor has taken any
action, that would cause the representations and
warranties made by the mortgagor in the Mortgage Loan
documents not to be true;
(xvii) The proceeds of the Mortgage Loan have been fully
disbursed and there is no requirement for future
advances thereunder and the Mortgage Loan Seller
covenants that it will not make any future advances
under the Mortgage Loan to the mortgagor. Except for
the escrows and disbursements therefrom as
contemplated by the mortgage loan documents, any
mortgagor requirements for on or off-site
improvements as to disbursement of any escrow funds
therefor have been complied with;
(xviii) The Mortgage Loan Seller has inspected or caused to
be inspected each Mortgaged Property within the past
twelve months preceding the date hereof;
(xix) The Mortgage Loan does not have a shared appreciation
feature, other contingent interest feature or
negative amortization, except with those Mortgage
Loans that provide for Deferred Interest;
(xx) The Mortgage Loan is a whole loan and contains no
equity participation by the lender and is not
convertible into an equity interest in the borrower;
(xxi) No fraudulent acts were committed by the Mortgage
Loan Seller in connection with the origination
process of the Mortgage Loan;
(xxii) All taxes and governmental assessments that prior to
the date of origination of the Mortgage Loan became
due and owing in respect of each Mortgaged Property
have been paid, or an escrow of funds in an amount
sufficient to cover such payments has been
established or are insured against by the title
insurance policy issued in connection with the
origination of the Mortgage Loan;
(xxiii) To the extent required under applicable law, the
Mortgage Loan Seller was authorized to transact and
do business in each jurisdiction in which a Mortgaged
Property is located at all times when it held the
Mortgage Loan;
(xxiv) To the best knowledge of the Mortgage Loan Seller,
there is no material default, breach, violation or
event of acceleration existing under any of the
Mortgage Loan documents and the Mortgage Loan Seller
has not received actual notice of any event (other
than payments due but not yet delinquent) which, with
the passage of time or with notice and the expiration
of any grace or cure period, would and does
constitute a default, breach, violation or event of
acceleration; no waiver of the foregoing exists and
no person other than the holder of the Note may
declare any of the foregoing;
(xxv) Each Mortgage contains customary and enforceable
provisions such as to render the rights and remedies
of the holder thereof adequate for the realization
against each related Mortgaged Property of the
material benefits of the security, including
realization by judicial or, if applicable,
non-judicial foreclosure, and there is no exemption
available to the mortgagor which would materially
interfere with such right to foreclosure;
(xxvi) (A) With respect to each Mortgaged Property, a Phase
I environmental report and, in certain cases, a Phase
II environmental report or an update to such Phase I
report was conducted by a licensed qualified
engineer. The Mortgage Loan Seller has reviewed each
such report and update. (B) the Mortgage Loan Seller,
having made no independent inquiry other than
reviewing the environmental reports and updates
referenced herein and without other investigation or
inquiry, has no knowledge of any material and adverse
environmental condition or circumstance affecting any
Mortgaged Property that was not disclosed in the
related report and/or update. The Mortgage Loan
Seller has not received any actual notice of a
material violation of CERCLA or any applicable
federal, state or local environmental law with
respect to any Mortgaged Property that was not
disclosed in the related report and/or update. (C)
the Mortgage Loan Seller has not taken any actions
which would cause any Mortgaged Property not to be in
compliance with all federal, state and local laws
pertaining to environmental hazards (D) With respect
to the CenterAmerica Pool Properties, the summary of
the environmental reports regarding such Mortgaged
Properties prepared by the Mortgage Loan Seller, a
copy of which is attached as Schedule I hereto, lists
all material matters, if any, disclosed in the
environmental reports with respect to the
CenterAmerica Pool Properties;
(xxvii) The Mortgage Loan agreement contains provisions for
the acceleration of the payment of the unpaid
principal balance of the Mortgage Loan if (A) the
mortgagor voluntarily transfers or encumbers all or
any portion of any related Mortgaged Property, or (B)
any direct or indirect interest in mortgagor is
voluntarily transferred or assigned, other than, in
each case, as permitted under the terms and
conditions of the Mortgage Loan documents and, to the
best of the Mortgage Loan Seller's knowledge, the
mortgagor is not a debtor in a state or federal
bankruptcy or insolvency proceeding;
(xxviii) To the best of the Mortgage Loan Seller's knowledge
and without affirmative investigation or inquiry,
there is no pending action, suit or proceeding,
arbitration or governmental investigation against the
mortgagor or any Mortgaged Property an adverse
outcome of which could materially affect the
mortgagor's performance of its obligations under the
Mortgage Loan documents;
(xxix) The servicing and collection practices used by the
Mortgage Loan Seller, and to the best of the Mortgage
Loan Seller's knowledge, the origination practices of
the related Originator, have been in all respects
legal, proper and prudent and have met customary
industry standards except to the extent that, in
connection with its origination, such standards were
modified by the applicable Originator in its
reasonable discretion;
(xxx) In connection with the assignment, transfer or
conveyance of any individual Mortgage, the Note and
Mortgage contain no provision limiting the right or
ability of the applicable Originator to assign,
transfer and convey the Mortgage to any other person
or entity;
(xxxi) If any Mortgaged Property is subject to any leases
(other than any ground lease referred to in (xxxv)
below), to the best of the Mortgage Loan Seller's
knowledge, the mortgagor is the owner and holder of
the landlord's interest under any leases, and the
related Mortgage and Assignment of Leases, Rents and
Profits, if any, provides for the appointment of a
receiver for rents or allows the mortgagee to enter
into possession to collect rent or provide for rents
to be paid directly to mortgagee in the event of a
default, subject to the exceptions described in
clause (vi) hereof;
(xxxii) If a Mortgage is a deed of trust, a trustee, duly
qualified under applicable law to serve as such, has
been properly designated and currently so serves and
is named in the deed of trust, and no fees or
expenses are or will become payable to the trustee
under the deed of trust, except in connection with
the sale or release of the Mortgaged Property
following default or payment of the loan;
(xxxiii) Any insurance proceeds in respect of a casualty loss
or taking will be applied either 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 (provided that such proceeds exceed the
threshold amount described in the loan documents) as
the repair or restoration progresses, or to the
payment of the outstanding principal balance of the
Mortgage Loan together with any accrued interest
thereon, except to the extent of any excess proceeds
after restoration;
(xxxiv) Based on the Mortgage Loan Seller's review of the
100-year flood plain map provided by FEMA, except for
the Mortgaged Properties set forth on Schedule 1, no
Mortgaged Property is located in a special flood
hazard area (Zone A) as defined by the Federal
Insurance Administration and, with respect to the
Mortgaged Properties set forth on Schedule 1, flood
insurance coverage has been obtained;
(xxxv) With respect to any Mortgage which is secured in
whole or in part by the interest of a borrower as a
lessee under a ground lease and based upon the terms
of the ground lease or an estoppel letter from the
ground lessor the following apply to such ground
lease:
(A) The ground lease or a memorandum thereof has
been duly recorded, the ground lease permits
the interest of the lessee thereunder to be
encumbered by the related Mortgage, does not
restrict the use of the Mortgaged Property by
the lessee or its successors and assigns in a
manner that would adversely affect the
security provided by the related Mortgage,
and there has not been a material change in
the terms of the ground lease since its
recordation, with the exception of written
instruments which are part of the related
Mortgage Loan documents delivered to the
Trustee.
(B) The ground lease is not subject to any
liens or encumbrances superior to, or of
equal priority with, the related Mortgage,
other than the related ground lessor's
related fee interest [and any permitted
encumbrances on such fee interest].
(C) The borrower's interest in the ground lease
is assignable to the holder of the Mortgage
upon notice to, but without the consent of,
the lessor thereunder and, in the event that
it is so assigned, it is further assignable
by the trustee and its successors and assigns
upon notice to, but without a need to obtain
the consent of, such lessor.
(D) To the best of the Mortgage Loan Seller's
knowledge, as of the origination date of the
Mortgage Loan, the ground lease was in full
force and effect and no material default had
occurred under the ground lease and there was
no existing condition which, but for the
passage of time or the giving of notice,
would result in a default under the terms of
the ground lease. No notice of default under
the ground lease has been received by the
Mortgage Loan Seller.
(E) The ground lease requires the lessor
thereunder to give notice of any default by
the lessee to the mortgagee; and the ground
lease, or an estoppel letter received by the
mortgagee from the lessor, further provides
that notice of termination given under the
ground lease is not effective against the
mortgagee unless a copy of the notice has
been delivered to the mortgagee in the manner
described in such ground lease or estoppel
letter.
(F) The mortgagee is permitted a reasonable
opportunity (including, where necessary,
sufficient time to gain possession of the
interest of the lessee under the ground
lease) to cure any default under the ground
lease which is curable after the receipt of
notice of any default, before the lessor
thereunder may terminate the ground lease.
(G) The ground lease either (i) has a term
which extends not less than 10 years beyond
the maturity date of the related Mortgage
Loan or (ii) grants the lessee the option to
extend the term of the lease for a period (in
the aggregate) which exceeds ten years beyond
the maturity date of the related Mortgage
Loan.
(H) The ground lease requires the lessor to
enter into a new lease with the mortgagee
upon termination of the ground lease for any
reason, including rejection of the ground
lease in a bankruptcy proceeding, provided
the mortgagee cures the lessee's defaults to
the extent they are curable and succeeds to
the interest of the mortgagee.
(I) Under the terms of the ground lease and the
related Mortgage, taken together, any related
insurance proceeds will be applied either 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 the proceeds
as the repair or restoration progresses, or
to the payment of the outstanding principal
balance of the Mortgage Loan together with
any accrued interest thereon.
(J) Such ground lease does not impose any
material restrictions on subletting.
(K) Either the ground lease or the related
Mortgage contains the borrower's covenant
that such ground lease shall not be amended,
canceled, or terminated without the prior
written consent of the mortgagee.
(L) Either the ground lease or an estoppel
letter contains a covenant that the lessor
thereunder is not permitted in the absence of
an uncured default under the ground lease, 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;
(xxxvi) (A) the Mortgage Loan is directly secured by a
Mortgage on a commercial real property, and (B) the
fair market value of such real property, as evidenced
by an appraisal conducted within 12 months of the
origination of the Mortgage Loan, or as determined by
the Mortgage Loan Seller based on market studies and
pursuant to its underwriting standards, was at least
equal to 80% of the principal amount of the Mortgage
Loan (I) at origination (or if the Mortgage Loan has
been modified in a manner that constituted a deemed
exchange under Section 1001 of the Code at a time
when the Mortgage Loan was not in default or default
with respect thereto was not reasonably foreseeable,
the date of the last such modification) or (II) at
the Closing Date; provided that the fair market value
of the real property interest must first be reduced
by (1) the amount of any lien on the real property
interest that is senior to the Mortgage Loan (unless
such senior lien also secures a Mortgage Loan, in
which event the computation described in (I) and (II)
shall be made on an aggregated basis) and (2) a
proportionate amount of any lien that is in parity
with the Mortgage Loan (unless such other lien
secures a Mortgage Loan that is cross-collateralized
with such Mortgage Loan, in which event the
computation described in (I) and (II) shall be made
on an aggregate basis);
(xxxvii) To the best knowledge of the Mortgage Loan Seller,
all required certificates of occupancy and building
permits, as applicable, have been issued with respect
to the Mortgaged Property;
(xxxviii) Any escrow accounts for taxes or other reserves
required to be funded on the date of origination of
the Mortgage Loan pursuant to the Mortgage Loan
documents have been funded and all such escrow
accounts required to have been funded as of the
Cut-Off Date (taking into account any applicable
notice and grace period) have been funded;
(xxxix) The related Assignment of Mortgage constitutes a
legal, valid and binding assignment of such Mortgage
to the Depositor, and the related Reassignment of
Assignment of Leases, Rents and Profits, if any,
constitutes a legal, valid and binding assignment
thereof to the Depositor;
(xl) The related Note is not, and has not been since the
date of origination of the Mortgage Loan, secured by
any collateral except the lien of the related
Mortgage, any related Assignment of Leases, Rents and
Profits and any related security agreement and escrow
agreement; the security for the Mortgage Loan
consists only of the related Mortgaged Property or
Properties, any leases (including without limitation
any credit leases) thereof, and any appurtenances,
fixtures and other property located thereon; and such
Mortgaged Property or Properties do not secure any
mortgage loan other than the Mortgage Loan being
transferred and assigned to the Depositor hereunder
(except for Mortgage Loans, if any, which are
cross-collateralized with other Mortgage Loans being
conveyed to the Depositor or subsequent transferee
hereunder and identified on the Mortgage Loan
Schedule);
(xli) To the Mortgage Loan Seller's knowledge, based on due
diligence that it customarily performs in the
origination of comparable mortgage loans, as of the
date of origination of each Mortgage Loan, the
related Mortgagor was in possession of all material
licenses, permits and franchises required by
applicable law for the ownership and operation of the
related Mortgaged Property as it was then operated;
(xlii) Each Mortgage Loan requires that the borrower comply
with all legal requirements applicable to it and the
Mortgaged Property; and
(xliii) No Mortgage Loan is a loan in which the originator
paid the borrower a premium in exchange for a higher
Mortgage Rate ("Buy-up Loan").
3. Notice of Breach; Cure and Repurchase. (a) Pursuant to the Pooling and
Servicing Agreement, the Mortgage Loan Seller and the Depositor shall be given
notice of any breach of a representation or warranty made with respect to, or
any defect that materially and adversely affects the value of, a Mortgage Loan
or the interests of the holders of the Certificates therein.
(b) Upon notice pursuant to Section 3(a) herein, the Mortgage Loan Seller
shall cure such breach or defect, as the case may be, in all material respects
or repurchase the affected Mortgage Loan in accordance with the terms set forth
in Section 2.03 of the Pooling and Servicing Agreement. If the affected Mortgage
Loan is to be repurchased, the Mortgage Loan Seller shall remit the Repurchase
Price in immediately available federal funds to the Master Servicer.
(c) Upon any repurchase of a Mortgage Loan contemplated by Section 3(b)
above, the Trustee, the Master Servicer and the Special Servicer shall each
tender to the Mortgage Loan Seller all portions of the Mortgage File and other
documents pertaining to such Mortgage Loan possessed by it, as well as such
funds as pursuant to the Pooling and Servicing Agreement are to be paid to the
Mortgage Loan Seller in connection with such repurchase, and each document that
constitutes a part of the Mortgage File that was endorsed or assigned to the
Trustee shall be endorsed or assigned, as the case may be, to the Mortgage Loan
Seller.
(d) This Section 3 of this Agreement provides the sole remedy available to
the Certificateholders, or the Trustee on behalf of the Certificateholders,
respecting any defect in a Mortgage File or any breach of any representation or
warranty set forth in or required to be made pursuant to Section 2 of this
Agreement.
(e) The Mortgage Loan Seller hereby acknowledges the assignment by the
Depositor to the Trustee, as trustee under the Pooling and Servicing Agreement,
for the benefit of the Certificateholders, of the representations and warranties
contained herein and of the obligation of the Mortgage Loan Seller to repurchase
a Mortgage Loan pursuant to this Section. The Trustee or its designee may
enforce such obligations as provided in Section 8 hereof.
4. Representations, Warranties and Agreements of Depositor.
(a) The Depositor hereby represents and warrants to the Mortgage Loan
Seller, as of the date hereof (or such other date as is specified in the related
representation or warranty), as follows:
(i) The Depositor is a corporation duly organized,
validly existing and in good standing under the laws
of the State of Delaware, with full corporate power
and authority to own its assets and conduct its
business, is duly qualified as a foreign corporation
in good standing in all jurisdictions in which the
ownership or lease of its property or the conduct of
its business requires such qualification, except
where the failure to be so qualified would not have a
material adverse effect on the ability of the
Depositor to perform its obligations hereunder, and
the Depositor has taken all necessary action to
authorize the execution, delivery and performance of
this Agreement by it, and has the power and authority
to execute, deliver and perform this Agreement and
all the transactions contemplated hereby;
(ii) This Agreement has been duly authorized, executed and
delivered by the Depositor and constitutes a valid
and binding obligation of the Depositor, enforceable
against the Depositor in accordance with its terms,
except as such enforcement may be limited by
bankruptcy, reorganization, insolvency, moratorium
and other similar laws affecting the enforcement of
creditors' rights generally and to general principles
of equity (regardless of whether such enforceability
is considered in a proceeding in equity or at law);
(iii) The execution and delivery of this Agreement by the
Depositor and the performance of its obligations
hereunder will not conflict with any provision of any
law or regulation to which the Depositor is subject,
or conflict with, result in a breach of or constitute
a default under any of the terms, conditions or
provisions of any of the Depositor's organizational
documents or any agreement or instrument to which the
Depositor is a party or by which it is bound, or any
order or decree applicable to the Depositor, or
result in the creation or imposition of any lien on
any of the Depositor's assets or property, in each
case which would materially and adversely affect the
ability of the Depositor to carry out the
transactions contemplated by this Agreement;
(iv) There is no action, suit, proceeding or investigation
pending or to the knowledge of the Depositor,
threatened against the Depositor in any court or by
or before any other governmental agency or
instrumentality which would materially and adversely
affect the validity of this Agreement or any action
taken in connection with the obligations of the
Depositor contemplated herein, or which would be
likely to impair materially the ability of the
Depositor to perform under the terms of this
Agreement;
(v) The Depositor is not in default with respect to any
order or decree of any court or any order, regulation
or demand of any federal, state, municipal or
governmental agency, which default might have
consequences that would materially and adversely
affect the condition (financial or other) or
operations of the Depositor or its properties or
might have consequences that would materially and
adversely affect its performance hereunder; and
(vi) No consent, approval, authorization or order of any
court or governmental agency or body is required for
the execution, delivery and performance by the
Depositor of or compliance by the Depositor with this
Agreement or the consummation of the transactions
contemplated by this Agreement other than those that
have been obtained by the Depositor.
5. Depositor's Conditions to Closing. The obligations of the Depositor
under this Agreement shall be subject to the satisfaction, on the Closing Date,
or such other date specified herein, of the following conditions:
(a) The obligations of the Mortgage Loan Seller required to be performed by
it at or prior to the Closing Date pursuant to the terms of this Agreement shall
have been duly performed and complied with and all of the representations and
warranties of the Mortgage Loan Seller under this Agreement shall be true and
correct as of the date hereof and as of the Closing Date, and no event shall
have occurred which, with notice or the passage of time, or both, would
constitute a default under this Agreement, and the Depositor shall have received
a certificate to that effect signed by an authorized officer of the Mortgage
Loan Seller.
(b) The Depositor or its designee shall have received all of the following
closing documents, in such forms as are agreed upon and acceptable to the
Depositor and in form and substance satisfactory to the Depositor, the
Underwriter and their respective counsel, duly executed by all signatories other
than the Depositor as required pursuant to the respective terms thereof:
(i) with respect to each Mortgage Loan, the related
Mortgage File, which Mortgage Files shall be
delivered to and held by the Trustee on behalf of the
Depositor;
(ii) the final Mortgage Loan Schedule;
(iii) an officer's certificate from the Mortgage Loan
Seller dated as of the Closing Date, in the form
attached hereto as Exhibit B;
(iv) an opinion of Mortgage Loan Seller's counsel, subject
to customary exceptions and carve-outs, which state
in substance the opinions set forth on Exhibit C
hereto, and, in addition, an opinion delivered on the
date of the Prospectus as to the matters set forth in
the last paragraph of Exhibit C hereto;
(v) such other documents, certificates and opinions as
may be necessary to secure for the Certificates the
following ratings from Fitch IBCA, Inc. ("Fitch") and
Standard & ----- Poor's Ratings Service ("S&P", and
collectively with Fitch, the "Rating Agencies"), ---
---------------- respectively: for each of the Class
A-1, Class A-2, Class A-3, a "AAA" and "AAA" rating;
for the Class X Certificates, a "AAA" and "AAAr"
rating; for the Class B Certificates, a "AA+" and
"AAA" rating; for the Class C Certificates, a "AA"
and "AA" rating; for the Class D Certificates, a "A"
and "A" rating; for the Class E Certificates, a "BBB"
and "BBB+" rating; for the Class F Certificates, a
"BBB-" and a "BBB" rating; for the Class G
Certificates, a "BBB-" rating from Fitch; for the
Class H Certificates, a "BB" rating from Fitch; for
the Class J Certificates, a "B" rating from Fitch;
and
(vi) a letter from the independent accounting firm of KPMG
Peat Marwick LLP in form satisfactory to the
Depositor, relating to certain information regarding
the Mortgage Loans as set forth in the Prospectus
Supplement and a letter from KPMG Peat Marwick LLP
regarding certain information regarding the
Certificates as set forth in the Prospectus
Supplement;
(c) The Mortgage Loan Seller hereby agrees to furnish such other
information, documents, certificates, letters or opinions with respect to the
Mortgage Loans or itself as may be reasonably requested by the Depositor in
order for the Depositor to perform any of its obligations or satisfy any of the
conditions on its part to be performed or satisfied pursuant to the Underwriting
Agreement, the Pooling and Servicing Agreement or this Agreement.
6. Accountants' Letters. The parties hereto shall cooperate with KPMG Peat
Marwick LLP in making available all information and taking all steps reasonably
necessary to permit such accountants to deliver the letters required by the
Underwriting Agreement.
7. Notices. All communications hereunder shall be in writing and effective
only upon receipt and, if sent to the Depositor, will be mailed, hand delivered,
couriered or sent by facsimile transmission to it at 1585 Broadway, New York,
New York 10036, attention of Cecilia Tarrant, fax number (212) 761-6028, or, if
sent to the Mortgage Loan Seller, will be mailed, hand delivered, couriered or
sent by facsimile transmission and confirmed to it at 1585 Broadway, New York,
New York 10036, attention of Cecilia Tarrant, fax number (212) 761-0525, in
either case with a copy to Gregory Walker, Esq., fax number (212) 761-8915.
8. Trust as Beneficiary. The representations, warranties and agreements
made by the Mortgage Loan Seller in this Agreement are made for the benefit of,
and, to the extent they are assigned by the Depositor to the Trustee under the
Pooling and Servicing Agreement, may be enforced by or on behalf of, the
Trustee, the Master Servicer or the Special Servicer, as provided in the Pooling
and Servicing Agreement, to the same extent that the Depositor has rights
against the Mortgage Loan Seller under this Agreement in respect of
representations, warranties and agreements made by the Mortgage Loan Seller
herein.
9. Miscellaneous. This Agreement will be governed by and construed in
accordance with the substantive laws of the State of New York, without regard to
conflicts of laws principles. 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 or waived in any manner which would
have a material adverse effect on Certificateholders without the prior written
consent of the Trustee. 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 herein.
10. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement, or in
certificates of officers of the Mortgage Loan Seller and the Depositor submitted
pursuant hereto, shall remain operative and in full force and effect and shall
survive transfer and sale of the Mortgage Loans to the Depositor and by the
Depositor to the Trustee notwithstanding any language to the contrary contained
in any endorsement of any Mortgage Loan.
11. Severability. If any provision of this Agreement shall be prohibited or
invalid under applicable law, this Agreement shall be ineffective only to such
extent, without invalidating the remainder of this Agreement.
12. Further Assurances. The Mortgage Loan Seller and the Depositor agree to
execute and deliver such instruments and take such actions as the other party
may, from time to time, reasonably request in order to effectuate the purpose
and to carry out the terms of this Agreement.
[SIGNATURE PAGE FOLLOWS]
<PAGE>
IN WITNESS WHEREOF, the Depositor and the Mortgage Loan Seller
have caused this Agreement to be duly executed by their respective officers as
of the day and year first above written.
MORGAN STANLEY CAPITAL I INC.
By: ________________________________
Name: _________________________
Title: _________________________
MORGAN STANLEY MORTGAGE CAPITAL INC.
By: ________________________________
Name:___________________________
Title: _________________________
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
<PAGE>
EXHIBIT B
FORM OF OFFICER'S CERTIFICATE
I, ________________, hereby certify that I am a duly elected and acting
____________________ of Morgan Stanley Mortgage Capital Inc. (the "Seller"), in
connection with the sale of certain mortgage loans to Morgan Stanley Capital I
Inc. (the "Depositor") pursuant to that certain Loan Sale Agreement, dated as of
June 1, 1998 (the "Loan Sale Agreement"), between the Depositor and the
Depositor, and hereby certify further as follows:
1. The Seller is a New York corporation duly organized
and existing under the laws of the State of New York.
2. Attached hereto as Exhibit A is a true and correct
copy of the Articles of Incorporation of the Seller.
3. Attached hereto as Exhibit B is a true and correct
copy of the By-Laws of the Seller, as in effect at
all times on and after _____________, ____, through
the date hereof.
4. The resolutions attached hereto as Exhibit C (the
"Resolutions") were adopted by unanimous consent of
the board of directors of the Seller as of
_______________, 1998.
5. There have been no amendments, waivers or
modifications of the Articles of Incorporation other
than as provided in Exhibit A, and no action has been
taken by the Seller or its shareholders, directors or
officers in contemplation of the filing of any such
amendment or other documents or in contemplation of
the liquidation or dissolution of the Seller;
6. The Resolutions (a) represent the only resolutions of
the board of directors or shareholders of the Seller
relating to the sale of the mortgage loans referred
to in the Mortgage Loan Purchase and Sale Agreement;
(b) have not been amended, modified, rescinded or
repealed by any subsequent action of the Seller's
board of directors or shareholders; and (c) were in
full force and effect at all times on
_________________, 1998 and thereafter through the
date hereof;
7. Attached hereto as Exhibit D is a certificate of the
Secretary of the State of New York dated
___________________, 1998, with respect to the good
standing of the Seller in such State;
8. The representations and warranties of the Seller in
the Loan Sale Agreement are true and correct in all
material respects on and as of the date hereof.
9. On or prior to the date hereof, the Seller has
complied with all agreements and performed or
satisfied all conditions on its part to be performed
or satisfied at or prior to the date hereof.
10. Each person who, as a partner, agent or
representative of the Seller, signed the Loan Sale
Agreement or any other document or certificate
delivered on or before the date hereof in connection
with the transactions contemplated by the Loan Sale
Agreement was, at the respective times of such
signing and delivery, and is now, duly elected or
appointed, qualified and acting as such partner,
agent or representative, and the signature of such
persons appearing on such documents are their genuine
signatures.
[SIGNATURE PAGE FOLLOWS]
<PAGE>
IN WITNESS WHEREOF, I have hereunto signed my name as of
________, 1998.
By: ____________________________________
Name: ______________________________
Title:______________________________
<PAGE>
EXHIBIT C
FORM OF LEGAL OPINION
1. The Mortgage Loan Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of
New York, with full corporate power and authority to own its assets and
conduct its business, is in good standing in the State of New York, and
the Mortgage Loan Seller has taken all necessary action to authorize
the execution, delivery and performance of the Mortgage Loan Purchase
and Sale Agreement by it, and has the power and authority to execute,
deliver and perform the Mortgage Loan Purchase and Sale Agreement and
all the transactions contemplated hereby, including, but not limited
to, the power and authority to sell, assign and transfer the Mortgage
Loans in accordance with the Mortgage Loan Purchase and Sale Agreement.
2. Assuming the due authorization, execution and delivery of
the Mortgage Loan Purchase and Sale Agreement by the Depositor, the
Mortgage Loan Purchase and Sale Agreement and all of the obligations of
the Mortgage Loan Seller under the Mortgage Loan Purchase and Sale
Agreement are the legal, valid and binding obligations of the Mortgage
Loan Seller, enforceable against the Mortgage Loan Seller in accordance
with the terms of the Mortgage Loan Purchase and Sale Agreement, except
as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally, and by general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law), and except to the extent rights to
indemnity and contribution may be limited by applicable law.
3. The execution and delivery of the Mortgage Loan Purchase
and Sale Agreement by the Mortgage Loan Seller and the performance of
its obligations under the Mortgage Loan Purchase and Sale Agreement
will not conflict with any provision of any law or regulation to which
the Mortgage Loan Seller is subject, or conflict with, result in a
breach of or constitute a default under any of the terms, conditions or
provisions of any of the Mortgage Loan Seller's organizational
documents or, to our knowledge, any agreement or instrument to which
the Mortgage Loan Seller is a party or by which it is bound, or any
order or decree applicable to the Mortgage Loan Seller, or result in
the creation or imposition of any lien on any of the Mortgage Loan
Seller's assets or property, in each case which would materially and
adversely affect the ability of the Mortgage Loan Seller to carry out
the transactions contemplated by the Mortgage Loan Purchase and Sale
Agreement.
4. To our knowledge, there is no action, suit, proceeding or
investigation pending or threatened in writing against the Mortgage
Loan Seller in any court or by or before any other governmental agency
or instrumentality which would materially and adversely affect the
validity of the Mortgage Loans or the ability of the Mortgage Loan
Seller to carry out the transactions contemplated by this Agreement.
5. To our knowledge, the Mortgage Loan Seller is not in
default with respect to any order or decree of any court or any order,
regulation or demand of any federal, state, municipal or governmental
agency, which default might have consequences that would materially and
adversely affect the condition (financial or other) or operations of
the Mortgage Loan Seller or its properties or might have consequences
that would materially and adversely affect its performance under the
Mortgage Loan Purchase and Sale Agreement.
6. No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery
and performance by the Mortgage Loan Seller of or compliance by the
Mortgage Loan Seller with the Mortgage Loan Purchase and Sale Agreement
or the consummation of the transactions contemplated by the Mortgage
Loan Purchase and Sale Agreement, other than those which have been
obtained by the Mortgage Loan Seller.
<PAGE>
SCHEDULE 1
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
Representation Exception
- -------------- ---------
(vi) With respect to the Quail Springs Mall Loan, the related
title insurance company does not insure for consequences
resulting from the fact that May Department Store has
objected to the construction of the American Multi-Cinema
Theatre.
(viii) (A) With respect to the Wells Fargo Office Tower Loan,
Quail Springs Mall Loan, West Town Mall Loan,
Ramco-Gershenson Pool Loan and Courthouse Plaza I Loan,
the loan documents require insurers having "AA" claims
paying rating, whereas the actual property damage
insurance coverage obtained by the related borrower is
with an insurer with an "A" rating.
(xxxi) The mortgagor is the fee simple owner of the property and
has leased its interest to the Hotel Del Coronado
Operating Lessee. The Hotel Del Coronado Operating Lessee
holds the landlord's interest in certain space leases at
the Hotel Del Coronado Property.
(xxxiii) With respect to the CenterAmerica Pool Loan, such
proceeds must be made available to Borrower for
restoration of the affected property if (a) the mortgagee
has agreed to make such proceeds available for restoration
pursuant to a subordination, nondisturbance agreement
between a mortgagee and a tenant under a Major Lease or
(b) such proceeds must be made available for restoration
pursuant to the terms of a Major Lease in effect as of the
closing date of the Mortgage Loan. A Major Lease is any
lease (a) covering no less than the greater of (i) five
percent (5%) of the gross leaseable area of any individual
property or (ii) 15,000 leaseable square feet or (b) made
with a tenant that is an affiliate of any other tenant
under a lease at such individual property, if the leases
together cover no less than the greater of (i) five
percent (5%) of the gross leaseable area of such
individual property or (ii) 15,000 leaseable square feet.
(xxxiv) The CenterAmerica Pool Properties known as Jefferson
Park, Klein Square, and Village Plaza are each located in
a special flood hazard area. The CenterAmerica Pool
Borrower is required to maintain flood insurance in the
amount equal to the maximum available National Flood
Insurance Program coverage. The CenterAmerica Pool
Borrower has obtained such flood insurance as part of its
general risk insurance coverage in the amount of
$100,000,000. The property insurance for the CenterAmerica
Pool Properties is provided by St. Paul Fire and Marine
Insurance Company (50%), which has claims paying ability
rating of "AAA" by S&P, and by Lexington Insurance Company
(50%), which has claims paying ability rating of "AAA" by
S&P.
(xxxv) (H) Courthouse Plaza I Loan. The Courthouse Plaza I Ground
Lease only requires the lessor to enter into a new lease
with the mortgagee upon termination of the ground lease
due to a default that cannot be readily cured by
mortgagee, including without limitation bankruptcy.
(xxxvii) With respect to the CenterAmerica Pool Loan, properties
comprising the mortgaged property are located in countries
or municipalities which (A) did not issue certificates of
occupancy at the time of construction or (B) do not issue
certificates of occupancy for the shell building and only
issue certificates of occupancy to individual tenants with
respect to their leased premises. With respect to
properties to which clause (B) applies, the Mortgage Loan
Seller has been able to verify that certificates of
occupancy were issued to certain of those tenants.
<PAGE>
EXHIBIT H
FORM OF SUMMARY REPORT
<PAGE>
EXHIBIT I
FORM OF REPORTING PACKAGE
[State Street Logo]
Morgan Stanley Capital I Inc.
Commercial Mortgage Pass Through Certificates
Series 1998-XL1
W.A.C
W.A.M
Payment Date
Record Date
Trustee's Report to Certificateholders
Payment Summary
------------------------------------------------------------------------------
Pass-Through Interest Current Moody's
Class CUSIP Rate Type Rating **
------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
Original Beginning Principal Interest Total Ending
Class CUSIP Balance Balance Paid Paid Paid Balance
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------------------------------------------------------------
Total:
--------------------------------------------------------------------------------------------------------
</TABLE>
Distributions per Certificate
------------------------------------------------------------------------------
Beginning Principal Interest Ending
Class Certificate Factor Distribution Distribution Certificate
Factor
------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
--------------------------------------------------------------------
For additional information or with questions,
please contact:
--------------------------------------------------------------------
State Street Corporate Trust
--------------------------------------------------------------------
Bond Analyst:
Account Officer:
Street Connection:(factor and rate by cusip)
(617) 664-5500
To receive current or historical reports for this
deal please use:
Website: http://corporatetrust.statestreet.com
Street Fax:Bondholder & Secondary Market Reports(617) 664-5600
--------------------------------------------------------------------
STATE STREET
Serving Institutional
Investors Worldwide
- --------------------------------------------------------------------------------
This report has been prepared by or based on information furnished to State
Street Bank and Trust Company ("State Street") by one or more third parties
(e.g.,Servicer, Master Servicer, etc.).State Street shall not have and does not
undertake responsibility for the accuracy or completeness of information
provided by such third parties, and makes no representations or warranties with
respect to the accuracy or completeness thereof or the sufficiency thereof for
any particular purpose. State Street has not independently verified information
received from third parties, and shall have no liability for any inaccuracies
therein or caused thereby.
<PAGE>
[State Street Logo]
Morgan Stanley Capital I Inc.
Commercial Mortgage Pass Through Certificates
Series 1998-XL1
W.A.C
W.A.M
Payment Date
Record Date
<TABLE>
<CAPTION>
Trustee's Report to Certificateholders
Principal Detail
- ---------------------------------------------------------------------------------------------------------------------
Beginning Scheduled Unscheduled Other Principal/ Total Principal Realized Losses/
Class Balance Principal Principal Cash Adjustments Distribution Balance Adj.
Amount
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------
Totals:
------------------------------------------------------------------------------------------------------------
</TABLE>
Trustee's Report to Certificateholders
Principal Detail
- -------------------------------------------------------------------------------
Appraisal Ending Cumulative Cumulative
Class Reduction Balance Realized Losses Appraisal
Amt. Reduction
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Totals:
----------------------------------------------------------------------
<TABLE>
<CAPTION>
Interest Detail
- -------------------------------------------------------------------------------------------------------------------
Accrued Beg. Unpaid Prepayment Current Interest Additional Trust Prepayment
Class Certificate Interest Int. Shortfall Shortfalls Fund Expenses Premiums
Interest
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
- ---------
----------------------------------------------------------------------------------------------------------
Totals:
----------------------------------------------------------------------------------------------------------
</TABLE>
Interest Detail
- ---------------------------------------------------------------
Additional Total Interest Cumulative
Unpaid
Class Adjustments Distr. Amount Interest
Shortfall
- ---------------------------------------------------------------
- ---------------------------------------------------------------
Totals:
------------------------------------------------------
<PAGE>
[State Street Logo]
Morgan Stanley Capital I Inc.
Commercial Mortgage Pass Through Certificates
Series 1998-XL1
W.A.C
W.A.M
Payment Date
Record Date
Trustee's Report to Certificateholders
<TABLE>
<CAPTION>
Bond Class Rating, Subordination Level and Maturities:
- ------------------------------------------------------------------------------------------------------------------------------------
Ratings Original Current Last Original Current Orig. Class Maturity
Class As Of Date Rating Rating Rating Subordination Level Sub.Level @ 0% CPR
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------
Delinquencies One Month Two Months Three+Months Foreclosures Total
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
of Loans 0 0 0 0 0
- ----------------------------------------------------------------------------------------------------------
Ending APB $0.00 $0.00 $0.00 $0.00 $0.00
- ----------------------------------------------------------------------------------------------------------
</TABLE>
Twelve Month Summary of Prepayments and Prepayment Penalties:
- ---------------------------------------------------------------------
Month/Year Prepayments Penalties
- ---------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Appraisal Reductions: Current Total Cum.Total
--------------------------------
- --------------------------------------------------------------------------------------------------------------------------
Loan # 0 0 0 0 0 0
- --------------------------------------------------------------------------------------------------------------------------
Amount $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
[State Street Logo]
Morgan Stanley Capital I Inc.
Commercial Mortgage Pass Through Certificates
Series 1998-XL1
W.A.C
W.A.M
Payment Date
Record Date
Trustee's Report to Certificateholders
Other Information
===============================================================================
<TABLE>
<CAPTION>
Available Distribution Amount
Collateral Information: Closing Beg Ending
Coll. Balance Coll. Balance Coll. Balance
<S> <C> <C> <C>
Loan Count
Aggregate amount of P&I Advances made during current
period:
Servicing Fees:
Aggregate Amount of servicing compensation paid to
Master Servicer
Aggregate Amount of servicing compensation paid to
Trustee:
Additional Special Servicing Fee
Aggregate amount of:
Additional Trust Fund Expenses
Mortgage Loans that have been
paid in full:
Mortgage Loans that have been paid at their Maturity
Date:
Prepayment Penalties paid on the Mortgage Loans:
</TABLE>
================================================================================
<PAGE>
<PAGE>
EXHIBIT J
CURRENT INSURANCE SCHEDULE
CURRENT INSURANCE SCHEDULE FOR
COURTHOUSE PLAZA I
I. Property Name Charles E. Smith Companies
II. Coverages
Location(s) maintain the following limits:
- Blanket Building & Personal Property $461,454,000 any one loss
- Blanket Loss of Income $102,292,700 any one loss
Locations (ii), (iii) and (iv) maintain the following limits:
- Blanket Building & Personal Property $87,200,000 any one loss
- Blanket Loss of Income $16,100,000 any one loss
Separately, a $20,000,000 annual aggregate sublimit applies for the perils of
flood and/or earthquake damage, as well as a $15,000,000 building ordinance and
law sublimit.
The building damage replacement cost limit has been increased for 2150 and
2200-2300 Clarendon Square to reflect the revised 100% building damage
replacement cost value of $87,200,000 any one loss.
S & P
Insurer Coverage Rating
------- -------- ------
(i) American Motorist Boiler & Machinery A+
Ins. Co.
(ii) Travelers Indemnity All other coverages A+
Co. of IL
<PAGE>
CURRENT INSURANCE SCHEDULE FOR
QUAIL SPRINGS MALL
<TABLE>
<CAPTION>
Mortgage Existing
Requirements Insurance
------------ ---------
General Property Damage Insurance
- ------- -------------------------
<S> <C> <C> <C> <C> <C>
i) Best S & P
i) The existing subsection Insurer Rating Rating
------- ------ ------
5.12 requires an S & P Allendale Mutual A++ (FSC ml) A
rating of AA. Ins. Co.
General Liability
-----------------
2,000,000 Continental A (FSC xv) A+
Casualty
Excess Liability
----------------
25,000,000 Federal Ins. A++ (FSC xAAA)
</TABLE>
<PAGE>
CURRENT INSURANCE SCHEDULE FOR
RAMCO-GERSHENSON POOL
<TABLE>
<CAPTION>
General Insurance Lease Existing
Requirements Requirements Insurance
------------ ------------ ---------
<S> <C> <C>
B) (i)
(i) Insurers must be rated: A) Building Damage/Loss of Income &
Boiler & Machinery American Protection
A or better and FSC viii or Ins. Co. - A (FSC xiv)
better by A.M. Best Company
B) General Liability United States Fire A
Investment grade rating by (FSC xi)
credit agency approved by the
lender C) Excess Liability U.S. Fire Ins. Co. A
(FSC xi) - Primary layer Federal Ins.
Co. A++ (FSC xv) - Excess layer
</TABLE>
<PAGE>
CURRENT INSURANCE SCHEDULE FOR
WEST TOWN MALL
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
B) Insurers issuing policies must have a claims paying B) Insurer Coverage
------- --------
ability AA or better by at least two rating (i) Protection Mutual Building/
agencies, one of which shall be Standard & Poors. Insurance Company Loss of Rents
(ii) Zurich American General Liability
Insurance Group
(iii) Unknown Umbrella
(iv) Unknown Workers Compensation
(v) Unknown Auto Liability
</TABLE>
S&P Best
--- ----
B&B A+ FSC ix
AA+ A+ FSC xv
-- --
-- --
-- --
<PAGE>
EXHIBIT K
FORM OF REGULATION S TRANSFER CERTIFICATE
[Certificate Registrar]
Attention: Corporate Trust Administration
Re: Transfer of Morgan Stanley Capital I Inc., Commercial Mortgage
Past-Through Certificates, Series 1998-XL1, Class [ ]
-----------------------------------------------------------------
Ladies and Gentlemen:
This certificate is delivered pursuant to Section 5.02 of the Pooling and
Servicing Agreement dated as of June 1, 1998 (the "Pooling and Servicing
Agreement"), by and among Morgan Stanley Capital I Inc., as depositor, Midland
Loan Services, Inc., as servicer (the "Servicer"), Clarion Partners, LLC, as
special servicer (the "Special Servicer"), and State Street Bank and Trust
Company, as trustee (the "Trustee"), on behalf of the holders of the Morgan
Stanley Capital I Inc., Commercial Mortgage Pass-Through Certificates, 1998-XL1,
Class [ ] (the "Certificates") in connection with the transfer by the
undersigned (the "Transferor") to ____________(the "Transferee") of
$_____________________ Certificate Principal Amount of Certificates, in fully
registered form (each, an "Individual Certificate"), or a beneficial interest of
such aggregate Certificate Principal Amount in the Regulation S Global
Certificate (the "Global Certificate") maintained by The Depository Trust
Company or its successor as Depositary under the Pooling and Servicing Agreement
(such transferred interest, in either form, being the "Transferred Interest").
In connection with such transfer, the Transferor does hereby certify that
such transfer has been effected in accordance with the transfer restrictions set
forth in the Pooling and Servicing Agreement and the Certificates and (i) with
respect to transfers made in accordance with Regulation S ("Regulation S")
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
the Transferor does hereby certify that:
(1) the offer of the Transferred Interest was not made to a person in
the United States;
[(2) at the time the buy order was originated, the Transferee was
outside the United States or the Transferor and any person acting on its
behalf reasonably believed that the Transferee was outside the United
States;]*
[(2) the transaction was executed in, on or through the facilities of
a designated offshore securities market and neither the undersigned nor any
person acting on its behalf knows that the transaction was pre-arranged
with a buyer in the United States;]*
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
or (ii) with respect to transfers made in reliance on Rule 144 under the
Securities Act, the Transferor does hereby certify that the Certificates that
are being transferred are not "restricted securities" as defined in Rule 144
under the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor, the Trustee, the Servicer and the
Special Servicer.
__________________________________
Transferor
By: ______________________________
Name:
Title:
Dated: _________ __, 199_
- ----------
* Insert one of these two provisions, which come from the definition of
"offshore transaction" in Regulation S.
<PAGE>
EXHIBIT L
FORM OF TRANSFER CERTIFICATE
FOR EXCHANGE OR TRANSFER FROM RULE 144A
GLOBAL CERTIFICATE TO REGULATION S GLOBAL
CERTIFICATE DURING THE RESTRICTED PERIOD
(Exchanges or transfers pursuant to
Section 5.02(c)(ii)(A) of the Pooling and Servicing Agreement)
[Certificate Registrar]
Attention: Corporate Trust Administration
Re: Transfer of Morgan Stanley Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 1998-XL1 Class [ ]
-----------------------------------------------------------------
Reference is hereby made to the Pooling and Servicing Agreement dated as of
June 1, 1998 (the "Pooling and Servicing Agreement"), by and among Morgan
Stanley Capital I Inc., as depositor (the "Depositor"), Midland Loan Services,
Inc., as servicer (the "Servicer"), Clarion Partners, LLC, as special servicer
(the "Special Servicer") and State Street Bank and Trust Company, as trustee
(the "Trustee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Pooling and Servicing Agreement.
This letter relates to US $[__________] aggregate Certificate Principal
Amount of Certificates (the "Certificates") which are held in the form of the
Rule 144A Global Certificate (CUSIP No. ) with the Depository in the name of
[insert name of transferor] (the "Transferor"). The Transferor has requested a
transfer of such beneficial interest for an interest in the Regulation S Global
Certificate (CUSIP No. ) to be held with [Euroclear] [CEDEL]* (Common Code )
through the Depositary.
In connection with such request and in respect of such Certificates, the
Transferor does hereby certify that such transfer has been effected in
accordance with the transfer restrictions set forth in the Pooling and Servicing
Agreement and pursuant to and in accordance with Regulation S under the
Securities Act of 1933, as amended (the "Securities Act"), and accordingly the
Transferor does hereby certify that:
(1) the offer of the Certificates was not made to a person in the
United States,
[(2)at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any persons acting on its
behalf reasonably believed that the transferee was outside the United
States,]**
[(2)the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither the Transferor nor any
person acting on its behalf knows that the transaction was prearranged with
a buyer in the United States,]**
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable, and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor, the Trustee, the Servicer and the
Special Servicer.
[Insert Name of Transferor]
By: ________________________
Name:
Title:
Dated: _____________, ____
- ----------
* Select appropriate depository.
** Insert one of these two provisions, which come from the definition of
"offshore transaction" in Regulation S.
<PAGE>
EXHIBIT M
FORM OF TRANSFER CERTIFICATE
FOR EXCHANGE OR TRANSFER FROM RULE 144A
GLOBAL CERTIFICATE TO REGULATION S GLOBAL
CERTIFICATE AFTER THE RESTRICTED PERIOD
(Exchange or transfers pursuant to
Section 5.02(c)(ii)(B) of the Pooling and Servicing Agreement)
[Certificate Registrar]
Attention: Corporate Trust Administration
Re: Transfer of Morgan Stanley Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 1998-XL1, Class [ ]
-----------------------------------------------------------------
Reference is hereby made to the Pooling and Servicing Agreement dated as of
June 1, 1998 (the "Pooling and Servicing Agreement"), by and among Morgan
Stanley Capital I Inc., as depositor, Midland Loan Services, Inc., as servicer
(the "Servicer"), Clarion Partners, LLC, as special servicer (the "Special
Servicer") and State Street Bank and Trust Company, as trustee (the "Trustee").
Capitalized terms used but not defined herein shall have the meanings given to
them in the Pooling and Servicing Agreement.
This letter relates to US $[__________] aggregate Certificate Principal
Amount of Certificates (the "Certificates") which are held in the form of the
Rule 144A Global Certificate (CUSIP No. ) with the Depository in the name of
[insert name of transferor] (the "Transferor"). The Transferor has requested a
transfer of such beneficial interest in the Certificates for an interest in the
Regulation S Global Certificate (Common Code No. ).
In connection with such request, and in respect of such Certificates, the
Transferor does hereby certify that such transfer has been effected in
accordance with the transfer restrictions set forth in the Pooling and Servicing
Agreement and, (i) with respect to transfers made in reliance on Regulation S
under the Securities Act of 1933, as amended (the "Securities Act"), the
Transferor does hereby certify that:
(1) the offer of the Certificates was not made to a person in the
United States,
[(2)at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting on its
behalf reasonably believed that the transferee was outside the United
States,]*
[(2)the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither the Transferor nor any
person acting on its behalf knows that the transaction was prearranged with
a buyer in the United States,]*
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable, and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
or (ii) with respect to transfers made in reliance on Rule 144 under the
Securities Act, the Transferor does hereby certify that the Certificates that
are being transferred are not "restricted securities" as defined in Rule 144
under the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor, the Trustee, the Servicer and the
Special Servicer.
[Insert Name of Transferor]
By: ________________________
Name:
Title:
Dated: ____ __, ____
- ----------
* Insert one of these two provisions, which come from the definition of
"offshore transaction" in Regulation S.
<PAGE>
EXHIBIT N
FORM OF TRANSFER CERTIFICATE
FOR EXCHANGE OR TRANSFER FROM REGULATION S GLOBAL
CERTIFICATE TO RULE 144A GLOBAL CERTIFICATE
(Exchange or transfers pursuant to
Section 5.02(c)(ii)(C) of the Pooling and Servicing Agreement)
[Certificate Registrar]
Attention: Corporate Trust Administration
Re: Transfer of Morgan Stanley Capital I Inc., Commercial Mortgage
Pass-Through Certificates, Series 1998-XL1, Class [ ]
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Reference is hereby made to the Pooling and Servicing Agreement dated as of
June 1, 1998 (the "Pooling and Servicing Agreement"), by and among Morgan
Stanley Capital I Inc., as depositor (the "Depositor"), Midland Loan Services,
Inc., as servicer (the "Servicer"), Clarion Partners, LLC, as special servicer
(the "Special Servicer") and State Street Bank and Trust Company, as trustee
(the "Trustee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Pooling and Servicing Agreement.
This letter relates to US $[__________] aggregate Certificate Principal
Amount of Certificates (the "Certificates") which are held in the form of the
Regulation S Global Certificate (CUSIP No. __________) with [Euroclear] [CEDEL]*
(Common Code __________) through the Depository in the name of [insert name of
transferor] (the "Transferor"). The Transferor has requested a transfer of such
beneficial interest in the Certificates for an interest in the Regulation 144A
Global Certificate (CUSIP No. __________).
In connection with such request, and in respect of such Certificates, the
Transferor does hereby certify that such Certificates are being transferred in
accordance with (i) the transfer restrictions set forth in the Pooling and
Servicing Agreement and (ii) Rule 144A under the Securities Act to a transferee
that the Transferor reasonably believes is purchasing the Certificates for its
own account with respect to which the transferee exercises sole investment
discretion and the transferee and any such account is a "qualified institutional
buyer" within the meaning of Rule 144A, in each case in a transaction meeting
the requirements of Rule 144A and in accordance with any applicable securities
laws of any state of the United States or an jurisdiction.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor, the Trustee, the Servicer, the Special
Servicer and Morgan Stanley & Co. Incorporated, the Placement Agent of the
offering of the Certificates.
[Insert Name of Transferor]
By: ________________________
Name:
Title:
Dated: ____ __, 19__
- --------
* Select appropriate depository.
