<PAGE> 1
Filed Pursuant to Rule 424(b)(5)
Registration No. 333-40426-01
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED DECEMBER 12, 2000)
SALOMON BROTHERS COMMERCIAL MORTGAGE TRUST 2000-C3
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2000-C3
CLASS A-1, CLASS A-2, CLASS B, CLASS C, CLASS D, CLASS E AND CLASS F
APPROXIMATE TOTAL PRINCIPAL BALANCE AT INITIAL ISSUANCE: $825,481,000
We, Salomon Brothers Mortgage Securities VII, Inc., have prepared this
prospectus supplement in order to offer the classes of commercial mortgage
pass-through certificates identified above. These certificates are the only
securities offered by this prospectus supplement. This prospectus supplement
specifically relates to, and is accompanied by, our prospectus dated December
12, 2000. We will not list the offered certificates on any national securities
exchange or any automated quotation system of any registered securities
associations, such as NASDAQ.
The offered certificates will represent interests only in the trust
identified above. The offered certificates will not represent interests in or
obligations of any other party. The assets of the trust will include a pool of
multifamily and commercial mortgage loans. The initial mortgage pool balance
that we expect to transfer to the trust will be approximately $914,661,061. No
governmental agency or instrumentality or private insurer has insured or
guaranteed the offered certificates or any of the mortgage loans that back them.
Each class of offered certificates will receive monthly distributions of
interest, principal or both, commencing in January 2001. The table on page S-5
of this prospectus supplement contains a list of the classes of offered
certificates and sets forth the principal balance, pass-through rate, and other
select characteristics of each of those classes. Credit enhancement is being
provided through the subordination of various other classes, including multiple
non-offered classes, of series 2000-C3 certificates. That same table on page S-5
of this prospectus supplement also contains a list of the non-offered classes of
the series 2000-C3 certificates.
------------------
YOU SHOULD FULLY CONSIDER THE RISK FACTORS BEGINNING ON PAGE S-30 IN THIS
PROSPECTUS SUPPLEMENT AND ON PAGE 15 IN THE ACCOMPANYING PROSPECTUS PRIOR TO
INVESTING IN THE OFFERED CERTIFICATES.
------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------
Salomon Smith Barney Inc., Greenwich Capital Markets, Inc., Chase
Securities Inc., Deutsche Bank Securities Inc., J.P. Morgan Securities Inc. and,
solely outside the United States, ABN AMRO Bank N.V. are the underwriters for
this offering. They will purchase the offered certificates from us. Our proceeds
from the sale of the offered certificates will equal approximately 99.05% of the
total initial principal balance of the offered certificates, plus accrued
interest, before deducting expenses payable by us. Each underwriter's commission
will be the difference between the price it pays to us for its allocation of
offered certificates and the amount it receives from the sale of those offered
certificates to the public. Each underwriter currently intends to sell its
allocation of offered certificates from time to time in negotiated transactions
or otherwise at varying prices to be determined at the time of sale. See "Method
of Distribution" in this prospectus supplement.
[SALOMON SMITH BARNEY LOGO] [GREENWICH CAPITAL LOGO]
ABN AMRO
CHASE SECURITIES INC.
DEUTSCHE BANC ALEX. BROWN
J.P. MORGAN & CO.
The date of this prospectus supplement is December 12, 2000.
<PAGE> 2
[MAP]
<PAGE> 3
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Important Notice About the
Information Contained in
this Prospectus Supplement,
the Accompanying Prospectus
and the Related Registration
Statement................... S-4
Summary of Prospectus
Supplement.................. S-5
Risk Factors................... S-30
Capitalized Terms Used in this
Prospectus Supplement....... S-44
Forward-Looking Statements..... S-44
Description of the Mortgage
Pool........................ S-45
Servicing of the Underlying
Mortgage Loans.............. S-80
Description of the Offered
Certificates................ S-113
Yield and Maturity
Considerations.............. S-139
Use of Proceeds................ S-145
Federal Income Tax
Consequences................ S-146
ERISA Considerations........... S-150
Legal Investment............... S-154
Method of Distribution......... S-155
Legal Matters.................. S-157
Ratings........................ S-157
Glossary....................... S-159
</TABLE>
<TABLE>
<S> <C> <C>
ANNEX A -- Characteristics of
the Underlying
Mortgage Loans and
the Mortgaged Real
Properties......... A-1
ANNEX B --Decrement Tables... B-1
ANNEX C -- Form of Payment
Date Statement..... C-1
ANNEX D -- Global Clearance,
Settlement and Tax
Documentation
Procedures......... D-1
</TABLE>
PROSPECTUS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Important Notice About the
Information Presented in This
Prospectus................... 3
Available Information;
Incorporation by Reference... 3
Summary of Prospectus........... 4
Risk Factors.................... 15
Capitalized Terms Used in this
Prospectus................... 38
Description of the Trust
Assets....................... 38
Yield and Maturity
Considerations............... 67
Salomon Brothers Mortgage
Securities VII, Inc.......... 74
Description of the
Certificates................. 74
Description of the Governing
Documents.................... 86
Description of Credit Support... 96
Legal Aspects of Mortgage
Loans........................ 99
Federal Income Tax
Consequences................. 114
State and Other Tax
Consequences................. 167
ERISA Considerations............ 167
Legal Investment................ 172
Use of Proceeds................. 174
Method of Distribution.......... 174
Legal Matters................... 176
Financial Information........... 176
Rating.......................... 176
Glossary........................ 178
</TABLE>
S-3
<PAGE> 4
IMPORTANT NOTICE ABOUT THE INFORMATION CONTAINED IN THIS
PROSPECTUS SUPPLEMENT, THE ACCOMPANYING PROSPECTUS
AND THE RELATED REGISTRATION STATEMENT
Information about the offered certificates is contained in two separate
documents:--
- this prospectus supplement, which describes the specific terms of the
offered certificates; and
- the accompanying prospectus, which provides general information, some of
which may not apply to the offered certificates.
You should read both this prospectus supplement and the accompanying
prospectus in full to obtain material information concerning the offered
certificates.
In addition, we have filed with the Securities and Exchange Commission a
registration statement under the Securities Act of 1933, as amended, with
respect to the offered certificates. This prospectus supplement and the
accompanying prospectus form a part of that registration statement. However,
this prospectus supplement and the accompanying prospectus do not contain all of
the information contained in our registration statement. For further information
regarding the documents referred to in this prospectus supplement and the
accompanying prospectus, you should refer to our registration statement and the
exhibits to it. Our registration statement and the exhibits to it can be
inspected and copied at prescribed rates at the public reference facilities
maintained by the SEC at its public reference section, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at its regional offices located at: Chicago regional
office, Citicorp Center, 500 West Madison Street, Chicago, Illinois 60661; and
New York regional office, Seven World Trade Center, New York, New York 10048.
Copies of these materials can also be obtained electronically through the SEC's
internet web site (http:\\www.sec.gov).
You should only rely on the information contained in this prospectus
supplement, the accompanying prospectus and our registration statement. We have
not authorized any person to give any other information or to make any
representation that is different from the information contained in this
prospectus supplement, the accompanying prospectus or our registration
statement.
S-4
<PAGE> 5
SUMMARY OF PROSPECTUS SUPPLEMENT
This summary contains selected information regarding the offering being
made by this prospectus supplement. It does not contain all of the information
you need to consider in making your investment decision. TO UNDERSTAND ALL OF
THE TERMS OF THE OFFERING OF THE OFFERED CERTIFICATES, YOU SHOULD READ CAREFULLY
THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS IN FULL.
INTRODUCTION TO THE TRANSACTION
The offered certificates will be part of a series of commercial mortgage
pass-through certificates designated as the Series 2000-C3 Commercial Mortgage
Pass-Through Certificates, which series consists of multiple classes. The table
below identifies the respective classes of that series, specifies various
characteristics of each of those classes and indicates which of those classes
are offered by this prospectus supplement and which are not.
SERIES 2000-C3 COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
<TABLE>
<CAPTION>
APPROX.
APPROX. TOTAL
APPROX. % CREDIT
TOTAL OF INITIAL SUPPORT PASS- INITIAL WEIGHTED
PRINCIPAL MORTGAGE AT THROUGH PASS- AVERAGE MOODY'S/
BALANCE AT POOL INITIAL RATE THROUGH LIFE PRINCIPAL S&P
CLASS INITIAL ISSUANCE BALANCE ISSUANCE DESCRIPTION RATE (YEARS) WINDOW RATINGS
----- ---------------- ---------- -------- ----------- ------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Offered
Certificates
A-1......... $180,689,000 19.755% 23.000% Fixed 6.341% 5.71 1/01-7/09 Aaa/AAA
A-2......... $523,600,000 57.245% 23.000% Fixed 6.592% 9.38 7/09-10/10 Aaa/AAA
B........... $ 43,446,000 4.750% 18.250% Fixed/WAC Cap 6.758% 9.83 10/10-10/10 Aa2/AA
C........... $ 36,586,000 4.000% 14.250% Fixed/WAC Cap 6.906% 9.91 10/10-11/10 A2/A
D........... $ 13,720,000 1.500% 12.750% Fixed/WAC Cap 7.204% 9.91 11/10-11/10 A3/A-
E........... $ 13,720,000 1.500% 11.250% Fixed/WAC Cap 7.517% 9.91 11/10-11/10 Baa1/BBB+
F........... $ 13,720,000 1.500% 9.750% Fixed/WAC Cap 7.595% 9.91 11/10-11/10 Baa2/BBB
Non-Offered
Certificates
X........... N/A N/A N/A Variable IO 1.4412% N/A N/A Aaa/AAA
G........... $13,720,000 1.500% 8.250% Fixed/WAC Cap 8.090% N/A N/A Baa3/BBB-
H........... $27,440,000 3.000% 5.250% Fixed 7.000% N/A N/A NR/BB+
J........... $ 6,860,000 0.750% 4.500% Fixed 7.000% N/A N/A Ba2/BB
K........... $ 5,716,000 0.625% 3.875% Fixed 7.000% N/A N/A Ba3/BB-
L........... $10,290,000 1.125% 2.750% Fixed 7.000% N/A N/A B1/B+
M........... $ 4,574,000 0.500% 2.250% Fixed 7.000% N/A N/A B2/B
N........... $ 3,430,000 0.375% 1.875% Fixed 7.000% N/A N/A B3/B-
P........... $17,150,060 1.875% 0.000% Fixed 7.000% N/A N/A NR/NR
R........... N/A N/A N/A N/A N/A N/A N/A NR/NR
Y........... N/A N/A N/A N/A N/A N/A N/A NR/NR
</TABLE>
The offered certificates will evidence beneficial ownership interests in a
common law trust designated as the Salomon Brothers Commercial Mortgage Trust
2000-C3. We will form the trust at or prior to the time of initial issuance of
the offered certificates. The assets of the trust will include a pool of
multifamily and commercial mortgage loans having the characteristics described
in this prospectus supplement.
The governing document for purposes of issuing the offered certificates and
forming the trust will be a pooling and servicing agreement to be dated as of
December 1, 2000.
S-5
<PAGE> 6
The pooling and servicing agreement will also govern the servicing and
administration of the mortgage loans and the other assets that back the offered
certificates. The parties to the pooling and servicing agreement will include
us, a trustee, a certificate administrator, a tax administrator, a master
servicer and a special servicer. We will file a copy of the pooling and
servicing agreement with the SEC as an exhibit to a current report on Form 8-K,
within 15 days after the initial issuance of the offered certificates. The SEC
will make that current report on Form 8-K and its exhibits available to the
public for inspection.
KEY CERTIFICATE FEATURES SHOWN IN THE TABLE ABOVE
A. TOTAL PRINCIPAL BALANCE OR
NOTIONAL AMOUNT AT INITIAL
ISSUANCE................... The table on page S-5 of this prospectus
supplement sets forth for each class of the
series 2000-C3 certificates, other than the
class X, Y and R certificates, the approximate
total principal balance of that class at
initial issuance. The actual total principal
balance of any class of series 2000-C3
certificates at initial issuance may be larger
or smaller than the amount shown above,
depending on the actual size of the initial
mortgage pool balance. The actual size of the
initial mortgage pool balance may be as much as
5% larger or smaller than the amount presented
in this prospectus supplement.
The class A-1, A-2, B, C, D, E, F, G, H, J, K,
L, M, N and P certificates are the only series
2000-C3 certificates with principal balances.
The principal balance of any of those
certificates at any time represents the maximum
amount that the holder may receive as principal
out of cashflow received on or with respect to
the underlying mortgage loans.
The class X certificates do not have principal
balances. They are interest-only certificates.
For purposes of calculating the amount of
accrued interest with respect to the class X
certificates, however, they will have a total
notional amount equal to the total principal
balance of the class A-1, A-2, B, C, D, E, F,
G, H, J, K, L, M, N and P certificates
outstanding from time to time. The total
initial notional amount of the class X
certificates will be approximately
$914,661,060, although it may be as much as 5%
larger or smaller.
The class R certificates do not have principal
balances or notional amounts. They are residual
interest certifi-
S-6
<PAGE> 7
cates. The holders of the class R certificates
are not expected to receive any material
payments.
The class Y certificates also do not have
principal balances or notional amounts. They
represent the right to receive any collections
of additional interest on two mortgage loans,
representing 14.83% of the initial mortgage
pool balance, that have anticipated repayment
dates, as described under "--The Underlying
Mortgage Loans and the Mortgaged Real
Properties" below. The additional interest
results from an increase in the applicable
accrual rate if any of those mortgage loans
remains outstanding past its anticipated
repayment date.
B. TOTAL CREDIT SUPPORT AT
INITIAL ISSUANCE........... The respective classes of the series 2000-C3
certificates, other than the class Y and R
certificates, entitle their holders to varying
degrees of seniority for purposes of--
- receiving payments of interest and,
except in the case of the class X
certificates, payments of principal,
and
- bearing the effects of losses on the
underlying mortgage loans, as well as
default-related and other unanticipated
expenses of the trust.
In that regard, the class A-1, A-2 and X
certificates are the most senior, and the class
P certificates are the most subordinate. The
remaining classes of series 2000-C3
certificates, other than the class Y and R
certificates, are listed in the table on page
S-5 of this prospectus supplement from top to
bottom in descending order of seniority.
The class Y and R certificates do not provide
any credit support for, or receive any credit
support from, any other class of series 2000-C3
certificates.
The table on page S-5 of this prospectus
supplement shows the approximate total credit
support provided to each class of the series
2000-C3 certificates, other than the class X,
P, Y and R certificates, through the
subordination of other classes of the series
2000-C3 certificates. In the case of each of
those classes of series 2000-C3 certificates,
the credit support shown in the table on page
S-5 of this prospectus supple-
S-7
<PAGE> 8
ment represents the total initial principal
balance, expressed as a percentage of the
initial mortgage pool balance, of all classes
of the series 2000-C3 certificates that are
subordinate to the indicated class.
C. PASS-THROUGH RATE.......... Each class of the series 2000-C3 certificates,
other than the class Y and R certificates, will
bear interest. The table on page S-5 of this
prospectus supplement provides the indicated
information regarding the pass-through rate at
which each of those classes of the series
2000-C3 certificates will accrue interest.
Each class of series 2000-C3 certificates
identified in the table on page S-5 of this
prospectus supplement as having a Fixed
pass-through rate, has a fixed pass-through
rate that will remain constant at the initial
pass-through rate for that class.
Each class of series 2000-C3 certificates
identified in the table on page S-5 of this
prospectus supplement as having a Fixed/WAC Cap
pass-through rate, has a variable pass-through
rate equal to the lesser of--
- the initial pass-through rate for that
class, and
- a weighted average coupon derived from
net interest rates on the pooled
mortgage loans.
The pass-through rate for the class X
certificates will be variable and will equal
the excess, if any, of--
- a weighted average coupon derived from
net interest rates on the pooled
mortgage loans, over
- a weighted average of the pass-through
rates from time to time on the other
interest-bearing classes of series
2000-C3 certificates.
D. WEIGHTED AVERAGE LIFE AND
PRINCIPAL WINDOW........... The weighted average life of any class of
offered certificates refers to the average
amount of time, expressed in years, that will
elapse from the date of their issuance to the
respective dates of repayment to the investor
of each dollar to be applied in reduction of
the total principal balance of those
certificates. The principal window for any
class of offered certificates is the period
during which the holders of that class of
offered certificates will receive payments of
principal. The weighted average life and
principal window
S-8
<PAGE> 9
shown in the table on page S-5 of this
prospectus supplement for each class of offered
certificates were calculated based on the
following assumptions with respect to each
underlying mortgage loan--
- the related borrower timely makes all
payments on the mortgage loan,
- if the mortgage loan has an anticipated
repayment date, as described under
"--The Underlying Mortgage Loans and
the Mortgaged Real Properties" below,
the mortgage loan will be paid in full
on that date, and
- that mortgage loan will not otherwise
be prepaid prior to stated maturity.
The weighted average life and principal window
shown in the table on page S-5 of this
prospectus supplement for each class of offered
certificates were further calculated based on
the other maturity assumptions described under
"Yield and Maturity Considerations" in this
prospectus supplement.
E. RATINGS.................... The ratings shown in the table on page S-5 of
this prospectus supplement for the offered
certificates are those of Moody's Investors
Service, Inc. and Standard & Poor's Ratings
Services, a division of The McGraw Hill
Companies, Inc., respectively. It is a
condition to their issuance that the respective
classes of the offered certificates receive
credit ratings no lower than those shown in the
table on page S-5 of this prospectus
supplement.
The ratings of the offered certificates address
the timely payment of interest and the ultimate
payment of principal on or before December 18,
2033, which is the rated final payment date. A
security rating is not a recommendation to buy,
sell or hold securities and the assigning
rating agency may revise or withdraw its rating
at any time.
For a description of the limitations of the
ratings of the offered certificates, see
"Ratings" in this prospectus supplement.
S-9
<PAGE> 10
RELEVANT PARTIES
WHO WE ARE.................... Our name is Salomon Brothers Mortgage
Securities VII, Inc. We are a Delaware
corporation. Our address is 388 Greenwich
Street, New York, New York 10013 and our
telephone number is (212) 816-6000. We are an
indirect, wholly-owned subsidiary of Salomon
Smith Barney Holdings Inc. and an affiliate of
Salomon Smith Barney Inc. and Salomon Brothers
Realty Corp. See "Salomon Brothers Mortgage
Securities VII, Inc." in the accompanying
prospectus.
INITIAL TRUSTEE............... Wells Fargo Bank Minnesota, N.A., a national
banking association, will act as the initial
trustee on behalf of all the series 2000-C3
certificateholders. See "Description of the
Offered Certificates--The Trustee".
INITIAL CERTIFICATE
ADMINISTRATOR AND TAX
ADMINISTRATOR.............. LaSalle Bank National Association, a national
banking association, will act as the initial
certificate administrator and the initial tax
administrator with respect to the trust. See
"Description of the Offered Certificates -- The
Certificate Administrator and the Tax
Administrator" in this prospectus supplement.
INITIAL MASTER SERVICER....... Midland Loan Services, Inc., a Delaware
corporation, will act as the initial master
servicer with respect to the pooled mortgage
loans. See "Servicing of the Underlying
Mortgage Loans--The Initial Master Servicer and
the Initial Special Servicer" in this
prospectus supplement.
INITIAL SPECIAL SERVICER...... Lennar Partners, Inc., a Florida corporation,
will act as the initial special servicer with
respect to the pooled mortgage loans. See
"Servicing of the Underlying Mortgage
Loans--The Initial Master Servicer and the
Initial Special Servicer" in this prospectus
supplement.
CONTROLLING CLASS OF SERIES
2000-C3
CERTIFICATEHOLDERS......... The holders of certificates representing a
majority interest in a designated controlling
class of the series 2000-C3 certificates will
have the right, subject to the conditions
described under "Servicing of the Underlying
Mortgage Loans--The Series 2000-C3 Controlling
Class Representative" and "--Replace-
S-10
<PAGE> 11
ment of the Special Servicer" in this
prospectus supplement, to--
- replace the special servicer, and
- select a representative that may direct
and advise the special servicer on
various servicing matters.
Unless there are significant losses on the
underlying mortgage loans, the controlling
class of series 2000-C3 certificateholders will
be the holders of a non-offered class of series
2000-C3 certificates.
MORTGAGE LOAN SELLERS......... We will acquire the mortgage loans that are to
back the offered certificates, from--
- Salomon Brothers Realty Corp., which is
a New York corporation and an affiliate
of both us and Salomon Smith Barney
Inc.,
- Greenwich Capital Financial Products,
Inc., which is a Delaware corporation
and an affiliate of Greenwich Capital
Markets, Inc.,
- LaSalle Bank National Association,
which is a national banking association
and a subsidiary of ABN AMRO N.V., and
- Artesia Mortgage Capital Corporation,
which is a Delaware corporation.
See "Description of the Mortgage Pool--The
Mortgage Loan Sellers" in this prospectus
supplement.
UNDERWRITERS.................. Salomon Smith Barney Inc., Greenwich Capital
Markets, Inc., Chase Securities Inc., Deutsche
Bank Securities Inc., J.P. Morgan Securities
Inc. and, solely outside the United States, ABN
AMRO Bank N.V. are the underwriters with
respect to this offering. Salomon Smith Barney
Inc. is the lead manager. See "Method of
Distribution" in this prospectus supplement.
RELEVANT DATES AND PERIODS
CUT-OFF DATE.................. The pooled mortgage loans will be considered
part of the trust as of their respective due
dates in December 2000. All payments and
collections received on each of the underlying
mortgage loans after that date, excluding any
payments or collections that represent
S-11
<PAGE> 12
amounts due on or before that date, will belong
to the trust. Accordingly, the respective due
dates for the underlying mortgage loans in
December 2000 collectively represent the
cut-off date for the trust.
ISSUE DATE.................... The date of initial issuance for the offered
certificates will be on or about December 19,
2000.
PAYMENT DATE.................. Payments on the offered certificates are
scheduled to occur monthly, commencing in
January 2001. During any given month, the
payment date will be the 18th calendar day of
that month, or, if the 18th calendar day of
that month is not a business day, then the next
succeeding business day.
RECORD DATE................... The record date for each monthly payment on an
offered certificate will be the last business
day of the prior calendar month. The registered
holders of the offered certificates at the
close of business on each record date, will be
entitled to receive any payments on those
certificates on the following payment date.
COLLECTION PERIOD............. Amounts available for payment on the offered
certificates on any payment date will depend on
the payments and other collections received,
and any advances of payments due, on or with
respect to the underlying mortgage loans during
the related collection period. Each collection
period--
- will relate to a particular payment
date,
- will be approximately one month long,
- will begin when the prior collection
period ends or, in the case of the
first collection period, will begin on
the Closing Date, and
- will end during the month of, but prior
to, the related payment date.
INTEREST ACCRUAL PERIOD....... The amount of interest payable with respect to
the offered certificates on any payment date
will be a function of the interest accrued
during the related interest accrual period. The
interest accrual period for any payment date
will be the calendar month immediately
preceding the month in which that payment date
occurs.
S-12
<PAGE> 13
DESCRIPTION OF THE OFFERED CERTIFICATES
REGISTRATION AND
DENOMINATIONS................. We intend to deliver the offered certificates
in book-entry form in original denominations of
$10,000 initial principal balance and in any
whole dollar denomination in excess of $10,000.
You will initially hold your offered
certificates through The Depository Trust
Company, in the United States, or, in the case
of the class A-1 and A-2 certificates, through
Clearstream Banking, societe anonyme or The
Euroclear System, in Europe. As a result, you
will not receive a fully registered physical
certificate representing your interest in any
offered certificate, except under the limited
circumstances described under "Description of
the Offered Certificates--Registration and
Denominations" in this prospectus supplement
and under "Description of the
Certificates--Book-Entry Registration" in the
accompanying prospectus. We may elect to
terminate the book-entry system through DTC
with respect to all or any portion of any class
of offered certificates.
PAYMENTS
A. GENERAL.................... The certificate administrator will remit
payments of interest and principal to the
respective classes of series 2000-C3
certificateholders entitled to those payments,
sequentially as follows:
<TABLE>
<CAPTION>
PAYMENT ORDER CLASS
------------- --------------
<S> <C>
1(st)............................... A-1, A-2 and X
2(nd)............................... B
3(rd)............................... C
4(th)............................... D
5(th)............................... E
6(th)............................... F
7(th)............................... G
8(th)............................... H
9(th)............................... J
10(th)............................... K
11(th)............................... L
12(th)............................... M
13(th)............................... N
14(th)............................... P
</TABLE>
Allocation of interest payments among the class
A-1, A-2 and X certificates is pro rata based
on the
S-13
<PAGE> 14
respective amounts of interest payable on each
of those classes. Allocation of principal
payments between the class A-1 and A-2
certificates is described under
"--Payments--Payments of Principal" below. The
class X certificates do not have principal
balances and do not entitle their holders to
payments of principal.
See "Description of the Offered
Certificates--Payments--Priority of Payments"
in this prospectus supplement.
B. PAYMENTS OF INTEREST....... Each class of offered certificates will bear
interest. In each case, that interest will
accrue during each interest accrual period
based upon--
- the pass-through rate applicable for
the particular class for that interest
accrual period,
- the total principal balance or notional
amount, as the case may be, of the
particular class outstanding
immediately prior to the related
payment date, and
- the assumption that each year consists
of twelve 30-day months.
A whole or partial prepayment on an underlying
mortgage loan may not be accompanied by the
amount of one full month's interest on the
prepayment. As and to the extent described
under "Description of the Offered
Certificates--Payments--Payments of Interest"
in this prospectus supplement, these shortfalls
may be allocated to reduce the amount of
accrued interest otherwise payable to the
holders of all of the interest-bearing classes
of the series 2000-C3 certificates, including
the offered certificates, on a pro rata basis
in accordance with the respective amounts of
interest otherwise payable on those classes for
the corresponding interest accrual period.
On each payment date, subject to available
funds and the payment priorities described
under "--Payments--General" above, you will be
entitled to receive your proportionate share of
all unpaid distributable interest accrued with
respect to your class of offered certificates
through the end of the related interest accrual
period.
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<PAGE> 15
See "Description of the Offered
Certificates--Payments--Payments of Interest"
and "--Payments--Priority of Payments" in this
prospectus supplement.
C. PAYMENTS OF PRINCIPAL...... The class X, Y and R certificates do not have
principal balances and do not entitle their
holders to payments of principal. Subject to
available funds and the payment priorities
described under "--Payments--General" above,
however, the holders of each other class of
series 2000-C3 certificates will be entitled to
receive a total amount of principal over time
equal to the total principal balance of their
particular class. The certificate administrator
will remit payments of principal in a specified
sequential order to ensure that--
- no payments of principal will be made
to the holders of any non-offered class
of series 2000-C3 certificates until
the total principal balance of the
offered certificates is reduced to
zero,
- no payments of principal will be made
to the holders of the class B, C, D, E
or F certificates until, in the case of
each of those classes, the total
principal balance of all more senior
classes of offered certificates is
reduced to zero, and
- except as described in the following
paragraph, no payments of principal
will be made to the holders of the
class A-2 certificates until the total
principal balance of the class A-1
certificates is reduced to zero.
Because of losses on the underlying mortgage
loans and/or default-related or other
unanticipated expenses of the trust, the total
principal balance of the class B, C, D, E, F,
G, H, J, K, L, M, N and P certificates could be
reduced to zero at a time when the class A-1
and A-2 certificates remain outstanding. Under
those conditions, the certificate administrator
will remit payments of principal to the holders
of the class A-1 and A-2 certificates on a pro
rata basis in accordance with the respective
principal balances of those series 2000-C3
certificates.
S-15
<PAGE> 16
The total payments of principal to be made on
the series 2000-C3 certificates on any payment
date will be a function of--
- the amount of scheduled payments of
principal due or, in some cases, deemed
due on the underlying mortgage loans
during the related collection period,
which payments are either received as
of the end of that collection period or
advanced by the master servicer, and
- the amount of any prepayments and other
unscheduled collections of previously
unadvanced principal with respect to
the underlying mortgage loans that are
received during the related collection
period.
See "Description of the Offered
Certificates--Payments--Payments of Principal"
and "--Payments--Priority of Payments" in this
prospectus supplement.
D. PAYMENTS OF PREPAYMENT
PREMIUMS AND YIELD
MAINTENANCE CHARGES....... If any prepayment premium or yield maintenance
charge is collected on any of the pooled
mortgage loans, then the certificate
administrator will pay that amount in the
proportions described under "Description of the
Offered Certificates--Payments --Payments of
Prepayment Premiums and Yield Maintenance
Charges" in this prospectus supplement, to--
- the holders of the class X
certificates,
- the holders of the class or classes of
offered certificates, if any, that are
then entitled to receive payments of
principal, and/or
- the holders of the class G
certificates, if they are then entitled
to receive payments of principal.
REDUCTIONS OF CERTIFICATE
PRINCIPAL BALANCES IN
CONNECTION WITH LOSSES ON
THE UNDERLYING MORTGAGE
LOANS AND DEFAULT-RELATED
AND OTHER UNANTICIPATED
EXPENSES................... Because of losses on the underlying mortgage
loans and/or default-related and other
unanticipated ex-
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<PAGE> 17
penses of the trust, the total principal
balance of the mortgage pool, net of advances
of principal, may fall below the total
principal balance of the series 2000-C3
certificates. If and to the extent that those
losses and expenses cause a deficit to exist
following the payments made on the series
2000-C3 certificates on any payment date, the
total principal balances of the following
classes of series 2000-C3 certificates will be
sequentially reduced in the following order,
until that deficit is eliminated:
<TABLE>
<CAPTION>
REDUCTION ORDER CLASS
--------------- -----------
<S> <C>
1(st)................... P
2(nd)................... N
3(rd)................... M
4(th)................... L
5(th)................... K
6(th)................... J
7(th)................... H
8(th)................... G
9(th)................... F
10(th)................... E
11(th)................... D
12(th)................... C
13(th)................... B
14(th)................... A-1 and A-2
</TABLE>
Any reduction to the total principal balances
of the class A-1 and class A-2 certificates
will be made on a pro rata basis in accordance
with the relative sizes of the principal
balances of those series 2000-C3 certificates.
See "Description of the Offered
Certificates--Reductions of Certificate
Principal Balances in Connection With Realized
Losses and Additional Trust Fund Expenses" in
this prospectus supplement.
ADVANCES OF DELINQUENT MONTHLY
DEBT SERVICE PAYMENTS...... Except as described in the next two paragraphs,
the master servicer will be required to make
advances with respect to any delinquent monthly
payments, other than balloon payments, of
principal and/or interest due on the pooled
mortgage loans. In addition, the trustee must
make any of those advances that the master
servicer fails to make. As described under
"Description of the Offered Certificates--
Advances of Delinquent Monthly Debt Service
Payments" in this prospectus supplement, any
party that
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<PAGE> 18
makes an advance will be entitled to be
reimbursed for the advance, together with
interest at the prime rate described in that
section of this prospectus supplement.
Notwithstanding the foregoing, neither the
master servicer nor the trustee, however, will
be required to make any advance that it
determines will not be recoverable from
proceeds of the related mortgage loan.
In addition, if any of the adverse events or
circumstances that we refer to under "Servicing
of the Underlying Mortgage Loans--Required
Appraisals" in this prospectus supplement,
occur or exist with respect to any pooled
mortgage loan or the mortgaged real property
for that loan, the special servicer will be
obligated to obtain a new appraisal or, in
cases involving relatively small principal
balances, conduct a valuation of that property.
If, based on that appraisal or other valuation,
it is determined that--
- the principal balance of, and other
delinquent amounts due under, the
mortgage loan, exceed
- an amount equal to--
1. 90% of the new estimated value of
that real property, minus
2. the amount of any obligations
secured by liens on the property,
which liens are prior to the lien
of the mortgage loan, plus
3. escrows and reserves and any letter
of credit constituting additional
security for the mortgage loan,
then the amount otherwise required to be
advanced with respect to interest on that
mortgage loan will be reduced. The reduction
will be in the same proportion that the excess
bears to the principal balance of the mortgage
loan, net of related advances of principal. Due
to the payment priorities, any reduction in
advances will reduce the funds available to pay
interest on the most subordinate
interest-bearing classes of series 2000-C3
certificates then outstanding.
See "Description of the Offered
Certificates--Advances of Delinquent Monthly
Debt Service Pay-
S-18
<PAGE> 19
ments" and "Servicing of the Underlying
Mortgage Loans--Required Appraisals" in this
prospectus supplement. See also "Description of
the Certificates--Advances" in the accompanying
prospectus.
REPORTS TO
CERTIFICATEHOLDERS............ On each payment date, various statements and
reports prepared by the certificate
administrator, the master servicer and/or the
special servicer regarding the offered
certificates and the pooled mortgage loans will
be available to you and will contain the
information described under "Description of the
Offered Certificates--Reports to
Certificateholders; Available Information" in
this prospectus supplement.
Upon reasonable prior notice, you may also
review at the offices of the trustee, the
certificate administrator and/or the master
servicer during normal business hours a variety
of information and documents that pertain to
the pooled mortgage loans and the mortgaged
real properties for those loans. We expect that
the available information and documents will
include loan documents, borrower operating
statements, rent rolls and property inspection
reports, all to the extent received by the
trustee, the certificate administrator and/or
the master servicer, as applicable.
See "Description of the Offered
Certificates--Reports to Certificateholders;
Available Information" in this prospectus
supplement.
OPTIONAL TERMINATION.......... Specified parties to the transaction may
terminate the trust when the total principal
balance of the related mortgage pool, net of
advances of principal, is less than
approximately 1.0% of the initial mortgage pool
balance. See "Description of the Offered
Certificates--Termination" in this prospectus
supplement.
THE UNDERLYING MORTGAGE LOANS AND THE MORTGAGED REAL PROPERTIES
GENERAL....................... In this section, "--The Underlying Mortgage
Loans and the Mortgaged Real Properties", we
provide summary information with respect to the
mortgage loans that we intend to include in the
trust. For more detailed information regarding
those mortgage loans,
S-19
<PAGE> 20
you should review the following sections in
this prospectus supplement:
- "Risk Factors--Risks Related to the
Underlying Mortgage Loans";
- "Description of the Mortgage Pool"; and
- Annex A--Characteristics of the
Underlying Mortgage Loans and the
Mortgaged Real Properties.
When reviewing the information that we have
included in this prospectus supplement with
respect to the mortgage loans that are to back
the offered certificates, please note that--
- All numerical information provided with
respect to the mortgage loans is
provided on an approximate basis.
- All weighted average information
provided with respect to the mortgage
loans reflects a weighting based on
their respective cut-off date principal
balances. We will transfer the cut-off
date principal balance for each of the
mortgage loans to the trust. We show
the cut-off date principal balance for
each of the mortgage loans on Annex A
to this prospectus supplement.
- When information on the mortgaged real
properties is expressed as a percentage
of the initial mortgage pool balance,
the percentages are based upon the
cut-off date principal balances of the
related mortgage loans.
- If any of the mortgage loans is secured
by multiple mortgaged real properties,
a portion of that mortgage loan has
been allocated to each of those
properties for purposes of providing
various statistical information in this
prospectus supplement.
- Whenever mortgage loan level
information, such as loan-to-value
ratios or debt service coverage ratios,
is presented in the context of the
mortgaged real properties, the loan
level statistic attributed to a
mortgaged real property
S-20
<PAGE> 21
is the same as the statistic for the
related mortgage loan.
- Whenever we refer to a particular
mortgaged real property by name, we
mean the property identified by that
name on Annex A to this prospectus
supplement.
- Statistical information regarding the
mortgage loans may change prior to the
date of initial issuance of the offered
certificates due to changes in the
composition of the mortgage pool prior
to that date.
SOURCE OF THE UNDERLYING
MORTGAGE LOANS............. We are not the originator of the mortgage loans
that we intend to include in the trust. We will
acquire those mortgage loans from four separate
sellers. Each of those mortgage loans was
originated by--
- the related mortgage loan seller from
whom we acquired the mortgage loan,
- an affiliate of the related mortgage
loan seller, or
- a correspondent in the related mortgage
loan seller's conduit lending program.
PAYMENT AND OTHER TERMS....... Each of the mortgage loans that we intend to
include in the trust is the obligation of a
borrower to repay a specified sum with
interest.
Repayment of each of the mortgage loans is
secured by a mortgage lien on the ownership
and/or leasehold interest of the related
borrower or another party in one or more
commercial or multifamily real properties.
Except for limited permitted encumbrances,
which we describe in the glossary to this
prospectus supplement, that mortgage lien will
be a first priority lien.
All of the mortgage loans are or should be
considered nonrecourse. None of the mortgage
loans is insured or guaranteed by any
governmental agency or instrumentality or by
any private mortgage insurer.
Each of the mortgage loans currently accrues
interest at the annual rate specified with
respect to that loan on Annex A to this
prospectus supplement. Except as
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<PAGE> 22
otherwise described below with respect to
mortgage loans that have anticipated repayment
dates, the mortgage interest rate for each
mortgage loan is, in the absence of default,
fixed for the entire term of the loan.
Subject, in some cases, to a next business day
convention, all but one of the mortgage loans
provides for scheduled payments of principal
and/or interest to be due on the first day of
each month. One mortgage loan, representing
0.89% of the initial mortgage pool balance,
provides for scheduled payments of principal
and/or interest to be due on the fifth day of
each month.
One hundred sixty of the mortgage loans,
representing 81.34% of the initial mortgage
pool balance, provide for:
- an amortization schedule that is
significantly longer than its remaining
term to stated maturity; and
- a substantial payment of principal on
its maturity date.
Two of the mortgage loans, representing 14.83%
of the initial mortgage pool balance, provide
material incentives to the related borrower to
pay the mortgage loan in full by a specified
date prior to maturity. We consider that date
to be the anticipated repayment date for the
mortgage loan. There can be no assurance,
however, that these incentives will result in
any of these mortgage loans being paid in full
on or before its anticipated repayment date.
The incentives, which in each case will become
effective as of the related anticipated
repayment date, include:
- The calculation of interest in excess
of the initial mortgage interest rate.
The additional interest will be
deferred, may be compounded and will be
payable only after the outstanding
principal balance of the mortgage loan
is paid in full.
- The application of excess cash flow
from the mortgaged real property to pay
the principal amount of the mortgage
loan. The payment of principal will be
in addition to the principal
S-22
<PAGE> 23
portion of the normal monthly debt
service payment.
The remaining eighteen mortgage loans,
representing 3.83% of the initial mortgage pool
balance, have payment schedules that provide
for the payment of these mortgage loans in full
or substantially in full by their respective
maturity dates. These eighteen mortgage loans
do not provide for any of the repayment
incentives associated with the mortgage loans
that have anticipated repayment dates.
DELINQUENCY STATUS............ None of the mortgage loans that we intend to
include in the trust was more than 30 days
delinquent with respect to any monthly debt
service payment as of the cut-off date.
PREPAYMENT RESTRICTIONS....... As described more fully in Annex A to this
prospectus supplement, as of the cut-off date,
each of the mortgage loans that we intend to
include in the trust has one of the following
types of restrictions on voluntary prepayments:
- as of the cut-off date, 177 mortgage
loans, representing 97.94% of the
initial mortgage pool balance, provide
for a prepayment lockout period or a
prepayment lockout/defeasance period
when voluntary prepayments are
prohibited, followed, in some cases, by
a prepayment consideration period when
a voluntary prepayment must be
accompanied by prepayment
consideration, followed by an open
prepayment period when voluntary
prepayments are permitted without
payment of any prepayment
consideration; or
- as of the cut-off date, three mortgage
loans, representing 2.06% of the
initial mortgage pool balance, provide
for a prepayment consideration period,
followed by an open prepayment period.
DEFEASANCE.................... One hundred thirty of the mortgage loans to be
included in the trust, representing 90.10% of
the initial mortgage pool balance, permit the
related borrower to fully or partially defease
the mortgage loan and obtain a full or partial
release of the mortgaged real property from the
related mortgage
S-23
<PAGE> 24
lien by delivering U.S. Treasury obligations or
other government securities as substitute
collateral. Except with respect to two mortgage
loans, representing 0.25% of the initial
mortgage pool balance, the defeasance may not
occur prior to the second anniversary of the
date of initial issuance of the series 2000-C3
certificates.
ADDITIONAL STATISTICAL INFORMATION
A. GENERAL CHARACTERISTICS.... The mortgage pool will have the following
general characteristics as of the cut-off date:
<TABLE>
<S> <C>
Initial mortgage pool balance.... $914,661,061
Number of mortgage loans......... 180
Number of mortgaged real
properties..................... 184
Maximum cut-off date principal
balance........................ $119,577,993
Minimum cut-off date principal
balance........................ $ 494,988
Average cut-off date principal
balance........................ $ 5,081,450
Maximum mortgage interest rate... 9.350%
Minimum mortgage interest rate... 6.750%
Weighted average mortgage
interest rate.................. 8.169%
Maximum original loan term to
maturity or anticipated
repayment date................. 240 months
Minimum original loan term to
maturity or anticipated
repayment date................. 60 months
Weighted average original loan
term to maturity or anticipated
repayment date................. 121 months
Maximum remaining loan term to
maturity or anticipated
repayment date................. 234 months
Minimum remaining loan term to
maturity or anticipated
repayment date................. 52 months
Weighted average remaining loan
term to maturity or anticipated
repayment date................. 113 months
Maximum underwritten net cash
flow debt service coverage
ratio.......................... 3.94x
Minimum underwritten net cash
flow debt service coverage
ratio.......................... 1.05x
</TABLE>
S-24
<PAGE> 25
<TABLE>
<S> <C>
Weighted average underwritten net
cash flow debt service coverage
ratio.......................... 1.35x
Maximum cut-off date loan-to-
appraised value ratio.......... 79.81%
Minimum cut-off date loan-to-
appraised value ratio.......... 21.95%
Weighted average cut-off date
loan-to-appraised value
ratio.......................... 67.40%
</TABLE>
B. STATE CONCENTRATION........ The table below shows the number of, and
percentage of the initial mortgage pool balance
secured by, mortgaged real properties located
in the indicated states:
<TABLE>
<CAPTION>
% OF
NUMBER OF INITIAL MORTGAGE
STATE PROPERTIES POOL BALANCE
----- ---------- ----------------
<S> <C> <C>
Illinois............. 17 26.41%
California........... 34 16.63%
Michigan............. 10 5.62%
</TABLE>
The remaining mortgaged real properties are
located throughout 32 other states, the
District of Columbia and the Commonwealth of
Puerto Rico. No more than 4.69% of the initial
mortgage pool balance is secured by mortgaged
real properties located in any of these other
jurisdictions.
C. PROPERTY TYPES............. The table below shows the number of, and
percentage of the initial mortgage pool balance
secured by, mortgaged real properties operated
for each indicated purpose:
<TABLE>
<CAPTION>
% OF
NUMBER OF INITIAL MORTGAGE
PROPERTY TYPE PROPERTIES POOL BALANCE
------------- ---------- ----------------
<S> <C> <C>
Office............... 55 34.96%
Office (Shadow Rated
Baa3/BBB-)........ 1 13.07%
Multifamily.......... 40 11.35%
Anchored Retail...... 15 10.42%
Industrial........... 15 6.22%
Office/Retail........ 11 5.21%
Single Tenant
Retail............ 10 3.81%
Self Storage......... 8 3.23%
Mobile Home Park..... 3 2.96%
Office/Industrial.... 10 2.89%
</TABLE>
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<PAGE> 26
<TABLE>
<CAPTION>
% OF
NUMBER OF INITIAL MORTGAGE
PROPERTY TYPE PROPERTIES POOL BALANCE
------------- ---------- ----------------
<S> <C> <C>
Shadow Anchored
Retail............ 6 2.34%
Hotel................ 3 1.33%
Unanchored Retail. . 6 1.30%
Other................ 1 0.91%
</TABLE>
For purpose of the foregoing table, Office
(Shadow Rated Baa3/BBB-) refers to the shadow
ratings of Baa3 from Moody's and BBB- from S&P
with respect to the pooled mortgage loan
secured by the mortgaged real property
identified on Annex A as One Financial Place.
D. ENCUMBERED INTERESTS....... The table below shows the number of, and
percentage of the initial mortgage pool balance
secured by, mortgaged real properties for which
the encumbered interest is as indicated:
<TABLE>
<CAPTION>
ENCUMBERED INTEREST
IN THE % OF
MORTGAGED REAL NUMBER OF INITIAL MORTGAGE
PROPERTY PROPERTIES POOL BALANCE
--------------------- ---------- ----------------
<S> <C> <C>
Ownership............ 174 94.97%
Ownership in part,
Leasehold in
part.............. 5 2.89%
Leasehold............ 5 2.13%
</TABLE>
LEGAL AND INVESTMENT CONSIDERATIONS
FEDERAL INCOME TAX
CONSEQUENCES............... The tax administrator will make elections to
treat designated portions of the assets of the
trust as three separate real estate mortgage
investment conduits under Sections 860A through
860G of the Internal Revenue Code of 1986.
Those REMICs are as follows:
- REMIC I, the lowest tier REMIC, will
hold, among other things, the pooled
mortgage loans or, in each of two
cases, regular interests in a single
loan REMIC that holds one of the pooled
mortgage loans. REMIC I will also hold
various other related assets. It will
not hold, however, the collections of
additional interest accrued, and
deferred as to payment,
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<PAGE> 27
with respect to the two pooled mortgage
loans with anticipated repayment dates.
- REMIC II will hold the regular
interests in REMIC I.
- REMIC III will hold the regular
interests in REMIC II.
The offered certificates will be treated as
regular interests in REMIC III. This means that
they will be treated as newly issued debt
instruments for federal income tax purposes.
You will have to report income on your offered
certificates in accordance with the accrual
method of accounting even if you are otherwise
a cash method taxpayer.
None of the offered certificates will be issued
with more than a de minimis amount of original
issue discount. When determining the rate of
accrual of market discount and premium, if any,
for federal income tax purposes, the prepayment
assumption used will be that, subsequent to the
date of any determination:
- the two mortgage loans with anticipated
repayment dates will be paid in full on
their respective anticipated repayment
dates;
- no mortgage loan in the trust will
otherwise be prepaid prior to maturity;
- there will be no extension of maturity
for any mortgage loan in the trust; and
- no mortgage loan is purchased out of,
or otherwise removed from, the trust
for any reason.
If you own an offered certificate issued with
original issue discount, you will have to
report original issue discount income and be
subject to a tax on this income before you
receive a corresponding cash payment.
For a more detailed discussion of the federal
income tax aspects of investing in the offered
certificates, see "Federal Income Tax
Consequences" in each of this prospectus
supplement and the accompanying prospectus.
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<PAGE> 28
ERISA......................... We anticipate that, subject to satisfaction of
the conditions referred to under "ERISA
Considerations" in this prospectus supplement,
retirement plans and other employee benefit
plans and arrangements subject to--
- Title I of the Employee Retirement
Income Security Act of 1974, as
amended, or
- Section 4975 of the Internal Revenue
Code of 1986,
initially will be able to invest in the offered
certificates without giving rise to a
prohibited transaction. This is based upon an
individual prohibited transaction exemption
granted to Salomon Smith Barney Inc. by the
U.S. Department of Labor.
If you are a fiduciary of any retirement plan
or other employee benefit plan or arrangement
subject to Title I of ERISA or Section 4975 of
the Internal Revenue Code of 1986, you should
review carefully with your legal advisors
whether the purchase or holding of the offered
certificates could give rise to a transaction
that is prohibited under ERISA or Section 4975
of the Internal Revenue Code of 1986. See
"ERISA Considerations" in this prospectus
supplement and in the accompanying prospectus.
LEGAL INVESTMENT.............. The offered certificates will not be mortgage
related securities within the meaning of the
Secondary Mortgage Market Enhancement Act of
1984.
You should consult your own legal advisors to
determine whether and to what extent the
offered certificates will be legal investments
for you. See "Legal Investment" in this
prospectus supplement and in the accompanying
prospectus.
INVESTMENT CONSIDERATIONS..... The after-tax yield to maturity of any offered
certificate will depend upon, among other
things--
- the price paid for the offered
certificate,
- the rate, timing and amount of payments
on the offered certificate, and
- the tax consequences of holding the
offered certificate, including any
recognition of income
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<PAGE> 29
attributable to that certificate without
a corresponding payment.
The rate and timing of payments and other
collections of principal on or with respect to
the underlying mortgage loans will affect the
yield to maturity on each offered certificate.
In the case of offered certificates purchased
at a discount, a slower than anticipated rate
of payments and other collections of principal
on the underlying mortgage loans could result
in a lower than anticipated yield. In the case
of offered certificates purchased at a premium,
a faster than anticipated rate of payments and
other collections of principal on the
underlying mortgage loans could result in a
lower than anticipated yield.
The yield on the offered certificates with
variable or capped pass-through rates could
also be adversely affected if the underlying
mortgage loans with higher mortgage interest
rates pay principal faster than the mortgage
loans with lower mortgage interest rates. This
is because those classes bear interest at
pass-through rates equal to, based upon or
limited by, as applicable, a weighted average
of net interest rates derived from the mortgage
loans in the trust.
See "Yield and Maturity Considerations" in this
prospectus supplement and in the accompanying
prospectus.
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<PAGE> 30
RISK FACTORS
The offered certificates are not suitable investments for all investors. In
particular, you should not purchase any class of offered certificates unless you
understand and are able to bear the risks associated with that class.
The offered certificates are complex securities and it is important that
you possess, either alone or together with an investment advisor, the expertise
necessary to evaluate the information contained in this prospectus supplement
and the accompanying prospectus in the context of your financial situation.
You should consider the following factors, as well as those set forth under
"Risk Factors" in the accompanying prospectus, in deciding whether to purchase
any offered certificates. The "Risk Factors" section in the accompanying
prospectus includes a number of general risks associated with making an
investment in the offered certificates.
RISKS RELATED TO THE OFFERED CERTIFICATES
The Class B, C, D, E and F Certificates Are Subordinate to, and Are
Therefore Riskier than, the Class A-1 and A-2 Certificates. If you purchase
class B, C, D, E or F certificates, then your offered certificates will provide
credit support to other classes of offered certificates. As a result, you will
receive payments after, and must bear the effects of losses on the underlying
mortgage loans before, the holders of those other classes of offered
certificates.
When making an investment decision, you should consider, among other
things--
- the payment priorities of the respective classes of the series 2000-C3
certificates,
- the order in which the principal balances of the respective classes of
the 2000-C3 certificates with balances will be reduced in connection with
losses and default-related shortfalls, and
- the characteristics and quality of the mortgage loans in the trust.
See "Description of the Mortgage Pool" and "Description of the Offered
Certificates--Payments" and "--Reductions of Certificate Principal Balances in
Connection With Realized Losses and Additional Trust Fund Expenses" in this
prospectus supplement. See also "Risk Factors--The Investment Performance of
Your Offered Certificates Will Depend Upon Payments, Defaults and Losses on the
Underlying Mortgage Loans; and Those Payments, Defaults and Losses May Be Highly
Unpredictable", "--Any Credit Support for Your Offered Certificates May Be
Insufficient to Protect you Against all Potential Losses" and "--Payments on the
Offered Certificates Will Be Made Solely from the Limited Assets of the Related
Trust, and Those Assets May Be Insufficient to Make all Required Payments on
Those Certificates" in the accompanying prospectus.
The Offered Certificates Have Uncertain Yields to Maturity. The yield on
your offered certificates will depend on--
- the price you paid for your offered certificates, and
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<PAGE> 31
- the rate, timing and amount of payments on your offered certificates.
The rate, timing and amount of payments on your offered certificates will, in
turn, depend on:
- the pass-through rate for, and the other payment terms of, your offered
certificates;
- the rate and timing of payments, including prepayments, and other
collections of principal on the underlying mortgage loans;
- the rate and timing of defaults, and the severity of losses, if any, on
the underlying mortgage loans;
- the rate, timing and severity of any unanticipated or default-related
trust expenses that reduce amounts available for payment on the series
2000-C3 certificates;
- the rate, timing, severity and allocation of any other shortfalls that
reduce amounts available for payment on your offered certificates;
- the collection of prepayment premiums and yield maintenance charges with
respect to the underlying mortgage loans and the extent to which those
amounts are paid to you; and
- servicing decisions with respect to the underlying mortgage loans.
These factors cannot be predicted with any certainty. Accordingly, you may find
it difficult to analyze the effect that these factors might have on the yield to
maturity of your offered certificates.
See "Description of the Mortgage Pool", "Servicing of the Underlying
Mortgage Loans", "Description of the Offered Certificates--Payments" and
"--Reductions of Certificate Principal Balances in Connection With Realized
Losses and Additional Trust Fund Expenses" and "Yield and Maturity
Considerations" in this prospectus supplement. See also "Risk Factors--The
Investment Performance of Your Offered Certificates Will Depend Upon Payments,
Defaults and Losses on the Underlying Mortgage Loans; and Those Payments,
Defaults and Losses May Be Highly Unpredictable" and "Yield and Maturity
Considerations" in the accompanying prospectus.
The Investment Performance of Your Offered Certificates May Vary Materially
and Adversely from Your Expectations Because the Rate of Prepayments and Other
Unscheduled Collections of Principal on the Underlying Mortgage Loans is Faster
or Slower than You Anticipated. If you purchase your offered certificates at a
premium, and if payments and other collections of principal on the mortgage
loans in the trust occur at a rate faster than you anticipated at the time of
your purchase, then your actual yield to maturity may be lower than you had
assumed at the time of your purchase. Conversely, if you purchase your offered
certificates at a discount, and if payments and other collections of principal
on the mortgage loans in the trust occur at a rate slower than you anticipated
at the time of your purchase, then your actual yield to maturity may be lower
than you had assumed at the time of your purchase. You should consider that
prepayment premiums and yield maintenance charges may not be collected in all
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circumstances. Furthermore, even if a prepayment premium or yield maintenance
charge is collected and payable on your offered certificates, it may not be
sufficient to offset fully any loss in yield on your offered certificates.
The yield on the offered certificates with variable or capped pass-through
rates could also be adversely affected if the underlying mortgage loans with
higher mortgage interest rates pay principal faster than the mortgage loans with
lower mortgage interest rates. This is because those classes bear interest at
pass-through rates equal to, based upon or limited by, as applicable, a weighted
average of net interest rates derived from the mortgage loans in the trust.
Potential Conflicts of Interest. The master servicer, the special
servicer or any of their respective affiliates may--
- acquire series 2000-C3 certificates, and
- engage in other financial transactions, including as a lender, with the
underlying borrowers and their respective affiliates.
In particular, it is expected that the initial special servicer will
acquire some or all of the class J, K, L, M, N and P certificates.
In addition, the holders of certificates representing a majority interest
in the controlling class of the series 2000-C3 certificates may replace the
special servicer. See "Servicing of the Underlying Mortgage Loans--Replacement
of the Special Servicer" in this prospectus supplement.
Salomon Smith Barney Inc., one of the underwriters, is affiliated with us
and with Salomon Brothers Realty Corp., one of the mortgage loan sellers.
Greenwich Capital Markets, Inc., another one of the underwriters, is affiliated
with Greenwich Capital Financial Products, Inc., another one of the mortgage
loan sellers. ABN AMRO Bank N.V., another one of the underwriters, is affiliated
with LaSalle Bank National Association, another one of the mortgage loan
sellers.
The borrower under the mortgage loan secured by the mortgaged real property
identified on Annex A as One Financial Place, which mortgage loan represents
13.07% of the initial mortgage pool balance, is affiliated with Salomon Brothers
Realty Corp., the originator of the loan.
RISKS RELATED TO THE UNDERLYING MORTGAGE LOANS
Repayment of the Underlying Mortgage Loans Depends on the Operation of the
Mortgaged Real Properties. The underlying mortgage loans are secured by
mortgage liens on ownership and/or leasehold interests in the following types of
real property:
- Office
- Retail
- Multifamily
- Industrial
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<PAGE> 33
- Mixed Use
- Self Storage
- Mobile HomePark
- Hotel
- Other (Self Park)
The risks associated with lending on these types of real properties are
inherently different from those associated with lending on the security of
single-family residential properties. This is because, among other reasons,
repayment of each of the underlying mortgage loans is dependent on--
- the successful operation and value of the related mortgaged real
property, and
- the related borrower's ability to sell or refinance the mortgaged real
property.
See "Risk Factors--Repayment of a Commercial or Multifamily Mortgage Loan
Depends Upon the Performance and Value of the Underlying Real Property, which
May Decline Over Time, and the Related Borrower's Ability to Refinance the
Property, of which there Is No Assurance" and "Description of the Trust
Assets--Mortgage Loans--A Discussion of Various Types of Multifamily and
Commercial Properties that May Secure Mortgage Loans Underlying a Series of
Offered Certificates" in the accompanying prospectus.
The Underlying Mortgage Loans Have a Variety of Characteristics that May
Expose Investors to Greater Risk of Default and Loss. When making an
investment decision, you should consider, among other things, the following
characteristics of the underlying mortgage loans and/or the mortgaged real
properties for those loans. Any or all of these characteristics can affect,
perhaps materially and adversely, the investment performance of your offered
certificates. Each of the respective items below includes a cross-reference to
where the associated risks are further discussed in this prospectus supplement
or in the accompanying prospectus. In addition, each of those items may include
a cross reference to where further information about the particular
characteristic may be found in this prospectus supplement.
- The Mortgaged Real Property Will Be the Sole Asset Available to Satisfy
the Amounts Owing Under an Underlying Mortgage Loan in the Event of
Default. All of the mortgage loans that we intend to include in the trust
are or should be considered nonrecourse loans. If the related borrower
defaults on any of the underlying mortgage loans, only the mortgaged real
property, and none of the other assets of the borrower, is available to
satisfy the debt. Even if the related loan documents permit recourse to
the borrower or a guarantor, the trust may not be able to ultimately
collect the amount due under a defaulted mortgage loan. None of the
mortgage loans are insured or guaranteed by any governmental agency or
instrumentality or by any private mortgage insurer. See "Risk
Factors--Repayment of a Commercial or Multifamily Mortgage Loan Depends
Upon the Performance and Value of the Underlying Real Property, which May
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<PAGE> 34
Decline Over Time, and the Related Borrower's Ability to Refinance the
Property, of which there Is No Assurance--Most of the Mortgage Loans
Underlying Your Offered Certificates Will be Nonrecourse" in the
accompanying prospectus.
- In Some Cases, a Mortgaged Real Property is Dependent on a Single Tenant
or on One or a Few Major Tenants. In the case of forty-one mortgaged
real properties, securing 23.84% of the initial mortgage pool balance,
the related borrower has leased the particular property to a single
tenant that occupies all or substantially all of the particular mortgaged
property. In the case of one hundred two mortgaged real properties,
securing 53.44% of the initial mortgage pool balance and including the
forty-one properties referred to in the prior sentence, the related
borrower has leased the property to at least one tenant that occupies 25%
or more of the particular mortgaged real property. Accordingly, the full
and timely payment of each of the related mortgage loans is highly
dependent on the continued operation of the major tenant or tenants,
which, in some cases, is the sole tenant, at the mortgaged real property.
See "Risk Factors--Repayment of a Commercial or Multifamily Mortgage Loan
Depends Upon the Performance and Value of the Underlying Real Property,
which May Decline Over Time and the Related Borrower's Ability to
Refinance the Property, of which there Is No Assurance--The Successful
Operation of a Multifamily or Commercial Property Depends on Tenants",
"--Repayment of a Commercial or Multifamily Mortgage Loan Depends Upon
the Performance and Value of the Underlying Real Property, which May
Decline Over Time and the Related Borrower's Ability to Refinance the
Property, of which there Is No Assurance--Dependence on a Single Tenant
or a Small Number of Tenants Makes a Property Riskier Collateral" and
"--Repayment of a Commercial or Multifamily Mortgage Loan Depends Upon
the Performance and Value of the Underlying Real Property, which May
Decline Over Time and the Related Borrower's Ability to Refinance the
Property, of which there Is No Assurance--Tenant Bankruptcy Adversely
Affects Property Performance" in the accompanying prospectus.
- 10% or More of the Initial Mortgage Pool Balance Will Be Secured by
Mortgage Liens on Each of the Following Property Types--Office, Retail
and Multifamily.
Fifty-six of the mortgaged real properties, securing 48.03% of the initial
mortgage pool balance, are used entirely or almost entirely for office
purposes. Some of these office properties are heavily dependent on a sole
tenant that leases the entire property or on a few major tenants. In
addition, ten of the mortgaged real properties, securing 2.89% of the
initial mortgage pool balance, are used for office/industrial purposes.
Furthermore, eleven of the mortgaged real properties, securing 5.21% of
the initial mortgage pool balance, are used for mixed use purposes that
include significant retail and office components.
Thirty-seven mortgaged real properties, securing 17.86% of the initial
mortgage pool balance, are used for retail purposes. Fifteen of those
mortgage loans, representing 10.42% of the initial mortgage pool balance,
are secured by retail
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<PAGE> 35
properties that include at least one anchor tenant as part of the
mortgaged real property. Six of those mortgage loans, representing 2.34%
of the initial mortgage pool balance, are secured by shadow anchored
retail properties, where the anchor tenant is at a nearby property or on
a portion of the subject property that is not subject to the lien of the
related mortgage instrument. The remaining sixteen mortgaged real
properties, securing 5.10% of the initial mortgage pool balance, are
unanchored or single tenant retail properties. In addition, eleven of the
mortgaged real properties, securing 5.21% of the initial mortgage pool
balance, are used for mixed use purposes that include significant retail
and office components. The presence or absence of an anchor tenant in a
mall or shopping center can be important, because anchor tenants play a
key role in generating customer traffic and making the mall or center
desirable for other tenants. Some tenants may have clauses in their
leases that permit them to cease operations at the property if certain
other stores, in particular anchor tenants, cease operations at the
property. An anchor tenant is a retail tenant whose space is
substantially larger in size than that of other tenants at the same
retail mall or shopping center and whose operation is vital in attracting
customers to the property.
Forty of the mortgaged real properties, securing 11.35% of the initial
mortgage pool balance, are used for multifamily rental purposes. Three of
these multifamily rental properties, securing 0.61% of the initial
mortgage pool balance, have material concentrations of student tenants.
Students tend to be a less stable tenant population and projects with
material concentrations of student tenants tend to experience higher
property maintenance costs than those that do not. One of these mortgaged
real properties, securing 0.57% of the initial mortgage pool balance, has
a significant proportion of the tenants whose rents are subsidized by
housing assistance payments under the Section 8 Tenant-Based Assistance
Rental Certificate Program of the United States Department of Housing and
Urban Development. We also can give you no assurance that other mortgage
loans are not secured by mortgaged properties with a material
concentration of Section 8 tenants. We also can give you no assurance
that the Section 8 program will be continued in its present form or that
the level of assistance provided to tenants will generate enough revenues
to the borrower to meet its obligations under the housing assistance
payment loans and to pay for necessary property operations. Some of these
multifamily rental properties are subject to rent control laws and/or
land use restrictive covenants or contractual covenants that limit the
rental rates that may be charged at the subject properties.
The inclusion in the trust of a significant concentration of mortgage
loans that are secured by mortgage liens on a particular type of
income-producing property makes the overall performance of the mortgage
pool materially more dependent on the factors that affect the operations
at and value of that property type. See "Description of the Trust
Assets--Mortgage Loans--A Discussion of Various Types of Multifamily and
Commercial Properties that May Secure Mortgage Loans Underlying a Series
of Offered Certificates" in the accompanying prospectus.
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<PAGE> 36
- 5% or More of the Initial Mortgage Pool Balance Will Be Secured by
Mortgage Liens on Real Property Located in Each of the Following
States--Illinois, California and Michigan . The mortgaged real
properties located in each of the following states secure mortgage loans
or allocated portions of mortgage loans that represent 5% or more of the
initial mortgage pool balance:
<TABLE>
<CAPTION>
% OF
NUMBER OF INITIAL MORTGAGE
STATE PROPERTIES POOL BALANCE
----- ---------- ----------------
<S> <C> <C>
Illinois..................................... 17 26.41%
California................................... 34 16.63%
Michigan..................................... 10 5.62%
</TABLE>
The inclusion of a significant concentration of mortgage loans that are
secured by mortgage liens on real properties located in a particular
state makes the overall performance of the mortgage pool materially more
dependent on economic and other conditions or events in that state. See
"Risk Factors--Geographic Concentration Within a Trust Exposes Investors
to Greater Risk of Default and Loss" in the accompanying prospectus.
- The Mortgage Pool Will Include Material Concentrations of Balloon Loans
and Loans with Anticipated Repayment Dates. One hundred sixty mortgage
loans, representing 81.34% of the initial mortgage pool balance, are
balloon loans. In addition, two mortgage loans, representing 14.83% of
the initial mortgage pool balance, provide material incentives for the
related borrower to repay the loan by an anticipated repayment date prior
to maturity. One hundred twelve mortgage loans, representing 78.44% of
the initial mortgage pool balance, have either a maturity date or an
anticipated repayment date during the 12-month period from January 1,
2010 to December 31, 2010. The ability of a borrower to make the required
balloon payment on a balloon loan at maturity, and the ability of a
borrower to repay a mortgage loan on or before any related anticipated
repayment date, in each case depends upon its ability either to refinance
the loan or to sell the mortgaged real property. Although a mortgage loan
may provide the related borrower with incentives to repay the loan by an
anticipated repayment date prior to maturity, the failure of that
borrower to do so will not be a default under that loan. See "Description
of the Mortgage Pool--Terms and Conditions of the Underlying Mortgage
Loans" in this prospectus supplement and "Risk Factors--The Investment
Performance of Your Offered Certificates Will Depend Upon Payments,
Defaults and Losses on the Underlying Mortgage Loans; and Those Payments,
Defaults and Losses May Be Highly Unpredictable--There is an Increased
Risk of Default Associated with Balloon Payments" in the accompanying
prospectus.
- The Mortgage Pool Will Include Some Disproportionately Large Mortgage
Loans and Groups of Cross-Collateralized Mortgage Loans. The inclusion
in the mortgage pool of one or more loans that have outstanding principal
balances that are substantially larger than the other mortgage loans can
result in losses that are more severe, relative to the size of the
mortgage pool, than would be the case if
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<PAGE> 37
the total balance of the mortgage pool were distributed more evenly. The
ten largest mortgage loans and groups of cross-collateralized mortgage
loans to be included in the trust represent 34.07% of the initial
mortgage pool balance. See "Description of the Mortgage Pool--General",
"--Cross-Collateralized Mortgage Loans, Multi-Property Mortgage Loans and
Mortgage Loans With Affiliated Borrowers" and "--Significant Underlying
Mortgage Loans" in this prospectus supplement and "Risk Factors--Loan
Concentration Within a Trust Exposes Investors to Greater Risk of Default
and Loss" in the accompanying prospectus.
- The Mortgage Pool Will Include Leasehold Mortgage Loans. Ten mortgage
loans, representing 5.03% of the initial mortgage pool balance, are
secured by mortgage liens on the related borrower's leasehold interest in
all or a portion of the mortgaged real property. Because of possible
termination of the related ground lease, lending secured by a leasehold
interest in a real property is riskier than lending secured by an actual
ownership interest in that property. See "Description of the Mortgage
Pool--Additional Loan and Property Information--Ground Leases" in this
prospectus supplement. See also "Risk Factors--Ground Leases Create Risks
for Lenders that Are Not Present When Lending on an Actual Ownership
Interest in a Real Property" and "Legal Aspects of Mortgage
Loans--Foreclosure--Leasehold Considerations" in the accompanying
prospectus.
- Some of the Mortgaged Real Properties Are Legal Nonconforming Uses or
Legal Nonconforming Structures. Several of the mortgage loans that we
intend to include in the trust are secured by a mortgage lien on a real
property that is a legal nonconforming use or a legal nonconforming
structure or that is subject to a de minimis zoning violation. This may
impair the ability of the borrower to restore the improvements on an
mortgaged real property to its current form or use following a major
casualty. See "Description of the Mortgage Pool--Underwriting
Matters--Zoning and Building Code Compliance" in this prospectus
supplement and "Risk Factors--Changes in Zoning may Adversely Affect the
Use or Value of a Real Property" in the accompanying prospectus.
- One Mortgaged Property Is Subject to Cross-easement and Revenue
Allocation Agreements. One mortgage loan, representing 0.91% of the
initial mortgage pool balance, is secured by a mortgage lien on a real
property that is subject to a cross-easement agreement that benefits and
burdens the property and a revenue allocation agreement with, in each
case, a neighboring real property, which neighboring real property is
owned by an affiliate of the borrower of that mortgage loan and which is
not security for that mortgage loan. Because the cross-easement and
revenue allocation agreements provide for possible termination thereof
for any reason by either party, there can be no assurances that the
mortgaged real property will continue to perform at the same gross
revenue, underwritten net cash flow and debt service coverage levels in
the absence of the cross-easement and revenue allocation agreements. See
"Description of the Mortgage
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<PAGE> 38
Pool--Additional Loan and Property Information--Cross-easement and
Revenue Allocation Agreements" in this prospectus supplement.
- Some of the Underlying Borrowers Have Incurred Other Debt. We are aware
of one mortgage loan that we intend to include in the trust, representing
3.87% of the initial mortgage pool balance, that currently has unsecured
debt outstanding in addition to trade receivables and other debts
incurred in the ordinary course of business:
<TABLE>
<CAPTION>
% OF INITIAL MORTGAGE OUTSTANDING
PROPERTY NAME POOL BALANCE UNSECURED DEBT
------------- --------------------- --------------
<S> <C> <C>
Medical Mutual of Ohio........................ 3.87% $11,942,000
</TABLE>
Two mortgage loans that we intend to include in the trust, representing
13.88% of the initial mortgage pool balance, permit limited amounts of
unsecured debt in addition to trade receivables and other debts incurred
in the ordinary course of business:
<TABLE>
<CAPTION>
% OF INITIAL MORTGAGE LIMITED ON
PROPERTY NAME POOL BALANCE UNSECURED DEBT
------------- --------------------- --------------
<S> <C> <C>
One Financial Place........................... 13.07% $2,400,000
601-609 Mission Street........................ 0.81% $ 170,000
</TABLE>
Forty-three of the mortgage loans that we intend to include in the trust,
representing 5.69% of the initial mortgage pool balance, do not have any
limitations on the related borrower's ability to incur unsecured debt.
In the case of some of the mortgage loans that we intend to include in
the trust, one or more of the principals of the related borrower have
incurred or are permitted to incur mezzanine debt. Mezzanine debt is debt
that is secured by the principal's ownership interest in the borrower.
This type of financing effectively reduces the indirect equity interest
of any principal in the corresponding mortgaged real property. While the
mezzanine lender has no security interest in or rights to the related
mortgaged real properties, a default under the mezzanine loan could cause
a change in control of the related borrower.
Except as disclosed under this "--Some of the Underlying Borrowers Have
Incurred Other Debt" subsection and "Description of the Mortgage
Pool--Additional Loan and Property Information--Additional and Other
Financing" in this prospectus supplement, we have not been able to
confirm whether the respective borrowers under the mortgage loans that we
intend to include in the trust have any other debt outstanding.
See "Description of the Mortgage Pool--Additional Loan and Property
Information--Additional and Other Financing" in this prospectus
supplement and "Risk Factors--Subordinate Debt Increases the Likelihood
That a Borrower Will Default on a Mortgage Loan Underlying Your Offered
Certificates" in the accompanying prospectus.
- Some of the Mortgaged Real Properties Do Not Comply with the Americans
with Disabilities Act of 1990. Not all of the mortgaged real properties
securing
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<PAGE> 39
mortgage loans that we intend to include in the trust, comply with the
Americans with Disabilities Act of 1990. Compliance can be expensive. See
"Risk Factors--Compliance with the Americans with Disabilities Act of
1990 May be Expensive" in the accompanying prospectus.
- Multiple Mortgaged Real Properties Are Owned by the Same Borrower or
Affiliated Borrowers or Are Occupied, in Whole or in Part, by the Same
Tenant or Affiliated Tenants. Seventeen separate groups of mortgage
loans that we intend to include in the trust, consisting of 42 mortgage
loans, representing 10.74% of the initial mortgage pool balance, have
borrowers that, in the case of each of those groups, are the same or
under common control. The largest of these groups is identified in Annex
A to this prospectus supplement as Related Mortgage Loan Group L1, which
consists of three mortgage loans, representing 2.02% of the initial
mortgage pool balance, that are controlled by Mr. Albert Friedman. See
"Description of the Mortgage Pool--Cross-Collateralized Mortgage Loans,
Multi-Property Mortgage Loans and Mortgage Loans With Affiliated
Borrowers" in this prospectus supplement.
In addition, there may be tenants that lease space at more than one
mortgaged real property securing mortgage loans that we intend to include
in the trust. Furthermore, there may be tenants that are related to or
affiliated with a borrower. See Annex A to this prospectus supplement for
a list of the two most significant tenants at each of the mortgaged real
properties used for retail purposes, office purposes and industrial
purposes.
The bankruptcy or insolvency of, or other financial problems with respect
to, any borrower or tenant that is, directly or through affiliation,
associated with two or more of the mortgaged real properties could have
an adverse effect on all of those properties and on the ability of those
properties to produce sufficient cash flow to make required payments on
the related mortgage loans in the trust. See "Risk Factors--Repayment of
a Commercial or Multifamily Mortgage Loan Depends upon the Performance
and Value of the Underlying Real Property, which May Decline Over Time
and the Related Borrower's Ability to Refinance the Property, of which
there Is No Assurance--Tenant Bankruptcy Adversely Affects Property
Performance", "--Borrower Concentration Within a Trust Exposes Investors
to Greater Risk of Default and Loss" and "--Borrower Bankruptcy
Proceedings Can Delay and Impair Recovery on a Mortgage Loan Underlying
Your Offered Certificates" in the accompanying prospectus.
- Some Borrowers Under the Underlying Mortgage Loans Will Not Be Special
Purpose Entities. The business activities of the borrowers under pooled
mortgage loans with cut-off date principal balances below $5,000,000 are
generally not limited to owning their respective mortgaged real
properties. However, we are also aware of at least two mortgage loans,
representing 1.41% of the initial mortgage pool balance, that each have a
cut-off date principal balance in excess of $5,000,000 and a borrower
that is not a special purpose entity. Accordingly, the financial success
of each of those borrowers may be affected by the performance
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<PAGE> 40
of its other business activities, including other real estate interests.
Those other business activities increase the possibility that the
borrower may become bankrupt or insolvent.
Changes in Mortgage Pool Composition Can Change the Nature of Your
Investment. If you purchase any of the class B, C, D, E or F certificates, you
will be more exposed to risks associated with changes in concentrations of
borrower, loan or property characteristics than are persons who own class A-1
and class A-2 certificates. See "Risk Factors--Changes in Pool Composition Will
Change the Nature of Your Investment" in the accompanying prospectus.
Lending on Income-Producing Real Properties Entails Environmental
Risks. The trust could become liable for a material adverse environmental
condition at one or more of the mortgaged real properties securing the mortgage
loans in the trust. Any potential environmental liability could reduce or delay
payments on the offered certificates.
Except for one mortgaged real property, securing 0.09% of the initial
mortgage pool balance, a third-party consultant conducted a Phase I
environmental study, or, in one case representing 0.11% of the initial mortgage
pool balance, an environmental screening assessment, for each mortgaged real
property securing a mortgage loan that we intend to include in the pool. That
environmental testing was conducted--
- in the case of 114 mortgaged real properties, securing 77.25% of the
initial mortgage pool balance, during the 12-month period ending on
November 30, 2000,
- in the case of 43 mortgaged real properties, securing 16.53% of the
initial mortgage pool balance, during the 12-month period ending on
November 30, 1999, and
- in the case of 26 mortgaged real properties, securing 6.14% of the
initial mortgage pool balance, on or before November 30, 1998.
In general, environmental screening assessments are less exhaustive
environmental assessments and/or result in less detailed reports than Phase I
environmental studies.
For one mortgaged real property, securing 0.09% of the initial mortgage
pool balance, the originator engaged an environmental consultant to review a
Phase II environmental report previously prepared three years prior by that
consultant for another lender. Based solely upon its review of this report,
confirmation that the use of the mortgaged real property had not changed and
confirmation that no new LUST sites were identified in the area, the consultant
concluded that there was no further investigation required.
For a discussion of the findings of the above-referenced environmental
testing, see "Description of the Mortgage Pool--Underwriting
Matters--Environmental Reports" in this prospectus supplement.
In the case of two mortgaged real properties, identified on Annex A to this
prospectus supplement as Boynton Plaza and Sav-on and Carl's Jr., environmental
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<PAGE> 41
studies were performed and one or more environmental issues were identified that
could not be fully assessed, remediated and/or "closed out" from a regulatory
point of view prior to the time that the related mortgage loan was expected to
be assigned to the trust. Each of these mortgaged real properties is covered by
an environmental insurance policy insuring specified environmental matters with
respect to the particular property. The policies referred to in the prior
sentence provide for specific coverage limits and deductibles. In addition,
those policies do not provide coverage for adverse environmental conditions at
levels below legal limits or for conditions involving asbestos and lead-based
paint. See "Description of the Mortgage Pool--Underwriting
Matters--Environmental Insurance" in this prospectus supplement.
See "Risk Factors--Environmental Liabilities Will Adversely Affect the
Value and Operation of the Contaminated Property and May Deter a Lender from
Foreclosing" and "Legal Aspects of Mortgage Loans--Environmental Considerations"
in the accompanying prospectus.
Lending on Income-Producing Properties Entails Risks Related to Property
Condition. One hundred eighty-two of the mortgaged real properties, securing
99.13% of the initial mortgage pool balance, were inspected by professional
engineers or architects. One hundred twelve of those mortgaged real properties,
securing 77.68% of the initial mortgage pool balance, were inspected during the
12-month period preceding the cut-off date. Forty seven of the mortgaged real
properties, securing 17.15% of the initial mortgage pool balance, were inspected
during the 12- to 24-month period preceding the cut-off date. The scope of those
inspections included an assessment of--
- the structure, exterior walls, roofing, interior construction, mechanical
and electrical systems, and
- general condition of the site, buildings and other improvements located
at each mortgaged real property.
Limitations on Enforceability of Cross-Collateralization Reduce its
Benefits. The mortgage pool will include 17 mortgage loans, representing 7.29%
of the initial mortgage pool balance, that are, in each case, individually or
through cross-collateralization with other mortgage loans, secured by two or
more mortgaged real properties or two or more parcels that are each material to
the value of a mortgaged real property. These mortgage loans are identified in
the tables contained in Annex A. The purpose of securing any particular mortgage
loan or group of cross-collateralized mortgage loans with multiple real
properties is to reduce the risk of default or ultimate loss as a result of an
inability of any particular property to generate sufficient net operating income
to pay debt service. However, six of these mortgage loans, representing 3.11% of
the initial mortgage pool balance, permit--
- the release of one or more of the mortgaged real properties or material
parcels from the related mortgage lien, and/or
- a full or partial termination of the applicable cross-collateralization,
in each case, upon the satisfaction of the conditions described under
"Description of the Mortgage Pool--Terms and Conditions of the Mortgage
Loans" in this prospectus supplement.
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<PAGE> 42
In addition, when multiple real properties secure a mortgage loan or group
of cross-collateralized mortgage loans, the amount of the mortgage encumbering
any particular one of those properties may be less than the full amount of the
related mortgage loan or group of cross-collateralized mortgage loans, generally
to avoid recording tax or for title insurance reasons. This mortgage amount may
equal the appraised value or allocated loan amount for the mortgaged real
property and will limit the extent to which proceeds from the property will be
available to offset declines in value of the other properties securing the same
mortgage loan or group of cross-collateralized mortgage loans.
Two mortgage loans that we intend to include in the trust are, in each
case, secured by real properties located in two or more states. These mortgage
loans represent 1.00% of the initial mortgage pool balance. Foreclosure actions
are brought in state court and the courts of one state cannot exercise
jurisdiction over property in another state. Upon a default under any of these
mortgage loans, it may not be possible to foreclose on the related mortgaged
real properties simultaneously.
Uninsured Loss; Sufficiency of Insurance. The borrowers under the
mortgage loans that we intend to include in the trust are, with limited
exception, required to maintain--
- comprehensive liability insurance,
- all-risk fire,
- casualty and hazard insurance,
- flood insurance, if the property is in a federally recognized flood zone
and flood insurance is available under applicable law,
- rental income insurance,
on the mortgaged real properties, with policy specifications, limits and
deductibles customarily carried, generally, for similar properties. Some types
of losses, however, may be either uninsurable or not economically insurable,
such as losses due to riots or acts of war or earthquakes. Forty-nine of the
mortgaged real properties, securing 23.24% of the initial mortgage pool balance,
are located in seismic zones 3 and 4, which are areas that are considered to
have a high earthquake risk. In addition, thirteen of the mortgaged real
properties, securing 4.07% of the initial mortgage pool balance, are located in
Florida and Texas, states that have historically been at greater risk than other
states regarding other acts of nature, such as hurricanes and tornadoes. Should
an uninsured loss occur, the borrower could lose both its investment in and its
anticipated profits and cash flow from its mortgaged real property, which would
adversely affect the borrower's ability to make payments under its mortgage
loan. Although, in general, the borrowers have agreed to insure their respective
mortgaged real properties, there is a possibility of casualty losses on a
mortgaged real property for which insurance proceeds may not be adequate.
Consequently, there can be no assurance that any loss incurred will not exceed
the limits of policies obtained. In addition, earthquake insurance is not
necessarily required to be maintained by a borrower, even in the case of
mortgaged real properties located in areas that are considered to have a high
earthquake risk.
Limited Information Causes Uncertainty. Forty-two of the mortgage loans
that we intend to include in the trust, representing 21.95% of the initial
mortgage pool balance, are acquisition financing. Accordingly, there may be
limited or no recent historical operating
S-42
<PAGE> 43
information available with respect to the mortgaged real properties for those
mortgage loans. As a result, you may find it difficult to analyze the historical
performance of those properties. Please refer to Annex A to this prospectus
supplement for historical operating information for the most recent three years
of operation, when available.
Prior Bankruptcies May Reflect Future Performance. We are aware that, in
the case of seven mortgage loans that we intend to include in the trust,
representing 2.88% of the initial mortgage pool balance--
- the related borrower or a principal in the related borrower has been a
party to, or
- the related mortgaged real property has been the subject of,
prior bankruptcy proceedings. There can be no assurance that principals or
affiliates of other borrowers have not been a party to bankruptcy proceedings.
Litigation May Adversely Affect Property Performance. There may be
pending or threatened legal proceedings against the borrowers under the pooled
mortgage loans, the managers of the related mortgaged real properties and their
respective affiliates, arising out of the ordinary business of those borrowers,
managers and affiliates. We cannot assure you that litigation will not have a
material adverse effect on your investment.
Tax Considerations Related to Foreclosure. If the trust were to acquire
an underlying real property through foreclosure or similar action, the special
servicer may be required to retain an independent contractor to operate and
manage the property. Any net income from that operation and management, other
than qualifying "rents from real property" within the meaning of section 856(d)
of the Internal Revenue Code of 1986, or any rental income based on the net
profits of a tenant or sub-tenant or allocable to a service that is
non-customary in the area and for the type of building involved, will subject
the trust to federal, and possibly state or local, tax as described under
"Federal Income Tax Consequences--REMICs--Prohibited Transactions Tax and Other
Taxes" in the accompanying prospectus. Those taxes, and the cost of retaining an
independent contractor, would reduce net proceeds available for distributions
with respect to the series 2000-C3 certificates.
Risks Related to Mortgaged Real Properties Located in Puerto Rico. One
mortgaged real property, securing 1.22% of the initial mortgage pool balance, is
located in Puerto Rico. If the trust acquires a real property located in Puerto
Rico, it would be subject to Puerto Rican taxation with respect to the income
derived from that property. If the activities of the trust in Puerto Rico in
relation to that real property constituted a trade or business, the trust would
be subject to income tax at up to a 39% rate with respect to its net income
attributable to the operation of that property, as well as a tax on any gain
derived from the sale of such property. In the case of gain from the sale of
real property used in a trade or business, in general, tax would be imposed at a
25% rate if the property were held as a capital asset for more than six months.
If the activities of the trust did not constitute the conduct of a trade or
business in Puerto Rico, income derived from the real property, such as rental
payments, would be subject to Puerto Rican withholding tax at a 29% rate. In
addition, any gain on the sale of the property would be subject to tax at a 29%
rate, and that tax may be collected through withholding. The imposition of any
of these Puerto Rican taxes on the trust could reduce
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<PAGE> 44
the net proceeds available for making payments on your offered certificates. In
addition, you would not be entitled to claim foreign tax credits for federal
income tax purposes with respect to any Puerto Rican tax imposed on the trust.
Additionally, it is possible that a Puerto Rican withholding tax may be
imposed at a rate of 29% on interest payments received by the trust on a
mortgage loan secured by a mortgaged real property located in Puerto Rico if a
certificateholder owns more than 50% of the related borrower. In that case, the
certificate administrator will make reasonable efforts to cause the withholding
tax imposed on the trust to be specially allocated to the certificateholder
owning more than 50% of the related borrower, with the amount of tax treated as
distributed to that certificateholder. That certificateholder would not be
entitled to claim foreign tax credits for federal income tax purposes with
respect to any Puerto Rican withholding tax imposed on the trust. Accordingly,
investment in the offered certificates may not be a suitable investment if you
own more than 50% of a borrower under a mortgage loan secured by a mortgaged
real property in Puerto Rico. If the subject withholding tax cannot be specially
allocated to that certificateholder, that tax would reduce amounts distributable
on the series 2000-C3 certificates.
CAPITALIZED TERMS USED IN THIS PROSPECTUS SUPPLEMENT
From time to time we use capitalized terms in this prospectus supplement.
Each of those capitalized terms will have the meaning assigned to it in the
"Glossary" attached to this prospectus supplement.
FORWARD-LOOKING STATEMENTS
This prospectus supplement and the accompanying prospectus includes the
words "expects", "intends", "anticipates", "estimates" and similar words and
expressions. These words and expressions are intended to identify forward-
looking statements. Any forward-looking statements are made subject to risks and
uncertainties that could cause actual results to differ materially from those
stated. These risks and uncertainties include, among other things, declines in
general economic and business conditions, increased competition, changes in
demographics, changes in political and social conditions, regulatory initiatives
and changes in customer preferences, many of which are beyond our control and
the control of any other person or entity related to this offering. The
forward-looking statements made in this prospectus supplement are accurate as of
the date stated on the cover of this prospectus supplement. We have no
obligation to update or revise any forward-looking statement.
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<PAGE> 45
DESCRIPTION OF THE MORTGAGE POOL
GENERAL
We intend to include the one hundred eighty mortgage loans identified on
Annex A to this prospectus supplement in the trust. The mortgage pool consisting
of those loans will have an initial mortgage pool balance of $914,661,061.
However, the actual initial mortgage pool balance may be as much as 5.0% smaller
or larger than that amount if any of those mortgage loans are removed from the
mortgage pool or any other mortgage loans are added to the mortgage pool. See
"--Changes in Mortgage Pool Characteristics" below.
The initial mortgage pool balance will equal the total cut-off date
principal balance of the mortgage loans included in the trust. The cut-off date
principal balance of any pooled mortgage loan is equal to its unpaid principal
balance as of the cut-off date, after application of all scheduled payments of
principal due with respect to the mortgage loan on or before that date, whether
or not those payments were received. The cut-off date principal balance of each
mortgage loan that we intend to include in the trust is shown on Annex A to this
prospectus supplement. Those cut-off date principal balances range from $494,988
to $119,577,993, and the average of those cut-off date principal balances is
$5,081,450.
Each of the mortgage loans that we intend to include in the trust is an
obligation of the related borrower to repay a specified sum with interest. Each
of those mortgage loans is evidenced by a promissory note and secured by a
mortgage, deed of trust or other similar security instrument that creates a
mortgage lien on the ownership and/or leasehold interest of the related borrower
or another party in one or more commercial or multifamily real properties. That
mortgage lien will, in all cases, be a first priority lien, subject only to
Permitted Encumbrances.
You should consider each of the pooled mortgage loans to be a nonrecourse
obligation of the related borrower. In the event of a payment default by the
related borrower, recourse will be limited to the corresponding mortgaged real
property or properties for satisfaction of that borrower's obligations. In those
cases where recourse to a borrower or guarantor is permitted under the related
loan documents, we have not undertaken an evaluation of the financial condition
of any of these persons. None of the pooled mortgage loans will be insured or
guaranteed by any governmental entity or by any other person.
We provide in this prospectus supplement a variety of information regarding
the mortgage loans that we intend to include in the trust. When reviewing this
information, please note that--
- All numerical information provided with respect to the mortgage loans is
provided on an approximate basis.
- All weighted average information provided with respect to the mortgage
loans reflects a weighting by their respective cut-off date principal
balances.
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<PAGE> 46
- If any of the mortgage loans is secured by multiple mortgaged real
properties, a portion of that mortgage loan has been allocated to each of
those properties for purposes of providing various statistical
information in this prospectus supplement.
- When information with respect to the mortgaged real properties is
expressed as a percentage of the initial mortgage pool balance, the
percentages are based upon the allocated cut-off date principal balances
of the related mortgage loans.
- Whenever loan level information, such as loan-to-value ratios and debt
service coverage ratios, is presented in the context of mortgaged real
properties, the loan level statistic attributed to a mortgaged real
property is the same as the statistic for the related mortgage loan.
- Whenever we refer to a particular mortgaged real property by name, we
mean the property identified by that name on Annex A to this prospectus
supplement.
- Statistical information regarding the mortgage loans may change prior to
the date of initial issuance of the offered certificates due to changes
in the composition of the mortgage pool prior to that date.
In addition, unless otherwise noted, for purposes of the tables in this
"Description of Mortgage Pool" section, we have assumed that the ARD Loans
mature on their respective anticipated repayment dates. See "--Terms and
Conditions of the Underlying Mortgage Loans--ARD Loans" below.
The table below shows the number of, and the approximate percentage of the
initial mortgage pool balance secured by, mortgaged real properties operated for
each indicated purpose:
PROPERTY TYPES
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
NUMBER OF % OF INITIAL MAXIMUM -----------------------------------------------
MORTGAGED TOTAL CUT-OFF MORTGAGE CUT-OFF DATE MORTGAGE STATED
REAL DATE PRINCIPAL POOL PRINCIPAL INTEREST REMAINING U/W NCF CUT-OFF DATE
PROPERTY TYPES PROPERTIES BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
-------------- ---------- -------------- ------------ ------------ --------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Office............... 55 $319,768,299 34.96% $ 35,364,183 8.374% 111 1.29x 68.85%
Office (Shadow Rated
Baa3/BBB-)......... 1 119,577,993 13.07 119,577,993 7.890 114 1.63 53.62
Multifamily.......... 40 103,846,773 11.35 15,988,455 7.941 118 1.33 70.11
Anchored Retail...... 15 95,272,425 10.42 18,235,848 7.762 109 1.30 71.24
Industrial........... 15 56,907,246 6.22 16,000,000 8.274 112 1.34 68.53
Office/Retail........ 11 47,667,302 5.21 11,010,038 8.085 120 1.34 65.97
Single Tenant
Retail............. 10 34,843,644 3.81 7,095,636 8.182 123 1.21 73.13
Self Storage......... 8 29,518,787 3.23 8,365,375 8.449 112 1.38 68.90
Mobile Home Park..... 3 27,039,989 2.96 22,714,214 7.938 118 1.20 78.26
Office/Industrial.... 10 26,478,174 2.89 6,781,144 8.483 115 1.34 69.20
Shadow Anchored
Retail............. 6 21,410,856 2.34 6,247,050 8.206 115 1.28 74.38
Hotel................ 3 12,136,926 1.33 9,550,083 8.854 135 1.58 62.97
Unanchored Retail.... 6 11,849,644 1.30 3,391,218 8.284 113 1.25 69.41
Other................ 1 8,343,003 0.91 8,343,003 9.000 76 1.50 47.67
--- ------------ ------- ----- --- ---- -----
Totals/Wtd. Avg.... 184 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ======= ===== === ==== =====
</TABLE>
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<PAGE> 47
For purpose of the foregoing table, Office (Shadow Rated Baa3/BBB-) refers
to the shadow ratings of Baa3 from Moody's and BBB- from S&P with respect to the
pooled mortgage loan secured by the mortgaged real property identified on Annex
A as One Financial Place.
The table below shows the number of, and the approximate percentage of the
initial mortgage pool balance secured by, first mortgage liens on each of the
specified interests in the corresponding mortgaged real properties:
ENCUMBERED INTEREST
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
NUMBER OF % OF INITIAL MAXIMUM -----------------------------------------------
MORTGAGED TOTAL CUT-OFF MORTGAGE CUT-OFF DATE MORTGAGE STATED
REAL DATE PRINCIPAL POOL PRINCIPAL INTEREST REMAINING U/W NCF CUT-OFF DATE
ENCUMBERED INTEREST PROPERTIES BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------------- ---------- -------------- ------------ ------------ --------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ownership............ 174 $868,697,306 94.97% $119,577,993 8.155% 113 1.35x 67.29%
Ownership in part and
Leasehold in
part............... 5 26,448,630 2.89 10,268,535 8.163 114 1.31 70.96
Leasehold............ 5 19,515,125 2.13 9,550,083 8.786 114 1.39 67.38
--- ------------ ------- ----- --- ---- -----
Totals/Wtd. Avg.... 184 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ======= ===== === ==== =====
</TABLE>
The table below shows the number of, and the approximate percentage of the
initial mortgage pool balance secured by, mortgaged real properties located in
the indicated states:
STATE CONCENTRATIONS
<TABLE>
<CAPTION>
CUMULATIVE WEIGHTED AVERAGES
NUMBER OF % OF INITIAL % OF INITIAL -------------------------------------------
MORTGAGED TOTAL CUT-OFF MORTGAGE MORTGAGE MORTGAGE STATED U/W
REAL DATE PRINCIPAL POOL POOL INTEREST REMAINING NCF CUT-OFF DATE
STATES PROPERTIES BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------ ---------- -------------- ------------ ------------ -------- ---------- ---- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Illinois................ 17 $241,516,982 26.41% 26.41% 7.986% 114 1.47x 60.46%
California.............. 34 152,100,783 16.63 43.03 8.278 112 1.40 64.93
Michigan................ 10 51,426,022 5.62 48.66 8.087 117 1.22 75.85
Ohio.................... 3 42,894,723 4.69 53.35 8.345 119 1.25 74.63
Massachusetts........... 5 41,482,031 4.54 57.88 8.469 96 1.29 69.92
Washington.............. 7 38,905,919 4.25 62.14 7.845 111 1.25 69.73
New York................ 10 31,165,163 3.41 65.54 8.231 115 1.31 71.05
Maryland................ 6 30,059,584 3.29 68.83 8.421 112 1.29 67.63
New Hampshire........... 5 28,180,874 3.08 71.91 7.988 101 1.26 73.12
Virginia................ 2 24,615,772 2.69 74.60 8.073 118 1.24 73.70
-- ------------ ----- ----- --- ---- -----
Total/Wtd. Avg. ...... 99 $682,347,852 74.60% 8.136% 112 1.37x 66.41%
== ============ ===== ===== === ==== =====
Other................. 85 $232,313,208 25.40% 8.265% 117 1.30x 70.31%
</TABLE>
The remaining mortgaged real properties securing mortgage loans that we
intend to include in the trust, are located throughout twenty-five other states,
the District of Columbia and the Commonwealth of Puerto Rico. No more than 2.56%
of the initial mortgage pool balance is secured by mortgaged real properties
located in any other single jurisdictions.
S-47
<PAGE> 48
CROSS-COLLATERALIZED MORTGAGE LOANS, MULTI-PROPERTY MORTGAGE LOANS AND MORTGAGE
LOANS WITH AFFILIATED BORROWERS
The mortgage pool will include 17 mortgage loans, representing 7.29% of the
initial mortgage pool balance, that are, in each case, individually or through
cross-collateralization with other mortgage loans, secured by two or more real
properties or two or more parcels that are material to the value of the
mortgaged real property. However, the amount of the mortgage lien encumbering
any particular property securing a multi-property mortgage loan or a group of
cross-collateralized mortgage loans may be less than the full amount of the
related mortgage loan or group of cross-collateralized mortgage loans, generally
to avoid recording tax or for title insurance reasons. The mortgage amount may
equal the appraised value or allocated loan amount for the particular real
property. This would limit the extent to which proceeds from that property would
be available to offset declines in value of the other mortgaged real properties
securing the same mortgage loan or group of cross-collateralized mortgage loans.
Six of the mortgage loans referred to in the prior paragraph, representing
3.11% of the initial mortgage pool balance, entitle the related borrower(s) to
obtain a release of one or more of the corresponding mortgaged real properties
or material parcels and/or a termination of any applicable
cross-collateralization, subject, in each case, to the fulfillment of one or
more of the following conditions:
- the pay down of the mortgage loan(s) in an amount equal to a specified
amount allocated to the property or parcel to be released; and/or
- the satisfaction of debt service coverage and loan-to-value tests for the
property or parcel that will remain as collateral; and/or
- receipt by the lender of confirmation from each applicable rating agency
that the action will not result in a qualification, downgrade or
withdrawal of any of the then-current ratings of the offered
certificates.
In addition, those same six mortgage loans also entitle the related borrower to
a release of one or more of the corresponding mortgaged real properties through
partial defeasance. See "--Terms and Conditions of the Mortgage
Loans--Defeasance Loans" below.
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<PAGE> 49
INDIVIDUAL LOANS, CROSSED LOAN GROUPS OR RELATED LOAN GROUPS
REPRESENTING GREATER THAN 2% OF THE INITIAL MORTGAGE POOL BALANCE
<TABLE>
<CAPTION>
% OF TOTAL
TOTAL CUT-OFF CUT-OFF DATE
LOAN/PROPERTY NAME DATE BALANCE BALANCE
------------------ ------------- ------------
<S> <C> <C>
One Financial Place....................... $119,577,993 13.07%
Medical Mutual of Ohio.................... $ 35,364,183 3.87%
Jorie Plaza............................... $ 22,800,000 2.49%
Westland Meadows.......................... $ 22,714,214 2.48%
Stonegate One............................. $ 20,985,981 2.29%
149 New Montgomery Street................. $ 18,809,602 2.06%
Friedman Portfolio (Crossed Loan Group
L1).................................... $ 18,500,000 2.02%
101 West Grand
57 W. Grand
40 West Hubbard
</TABLE>
TERMS AND CONDITIONS OF THE UNDERLYING MORTGAGE LOANS
Due Dates. Subject, in some cases, to next business day conventions, all
but one of the mortgage loans that we intend to include in the trust provide for
monthly debt service payments to be due on the first day of each month. One
mortgage loan, representing 0.89% of the initial mortgage pool balance, provides
for scheduled payments of principal and/or interest to be due on the fifth day
of each month.
Mortgage Rates; Calculations of Interest. In general, each of the
mortgage loans that we intend to include in the trust bears interest at a
mortgage interest rate that, in the absence of default, is fixed until maturity.
However, as described under "--ARD Loans" below, each of the two ARD Loans will
accrue interest after its anticipated repayment date at a rate that is in excess
of its mortgage interest rate prior to that date.
The current mortgage interest rate for each of the mortgage loans that we
intend to include in the trust is shown on Annex A to this prospectus
supplement. As of the cut-off date, those mortgage interest rates ranged from
6.750% per annum to 9.350% per annum, and the weighted average of those mortgage
interest rates was 8.169% per annum.
Except for ARD Loans that remain outstanding past their respective
anticipated repayment dates, none of the mortgage loans that we intend to
include in the trust provides for negative amortization or for the deferral of
interest.
Each of the pooled mortgage loans will accrue interest on the basis of one
of the following conventions:
- the actual number of days elapsed during each one-month accrual period in
a year assumed to consist of 360 days; or
- a 360-day year consisting of twelve 30-day months.
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<PAGE> 50
The table below shows the number of, and percentage of initial mortgage
pool balance represented by, pooled mortgage loans that will accrue interest
based on each of the foregoing conventions.
ACCRUAL TYPE
<TABLE>
<CAPTION>
% OF WEIGHTED AVERAGES
NUMBER INITIAL MAXIMUM --------------------------------------------
OF TOTAL CUT-OFF MORTGAGE CUT-OFF DATE MORTGAGE STATED U/W
MORTGAGE DATE PRINCIPAL POOL PRINCIPAL INTEREST REMAINING NCF CUT-OFF DATE
ACCRUAL TYPE LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------ -------- -------------- ------------ ------------ -------- ---------- ----- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Actual/360............ 166 $894,399,558 97.78% $119,577,993 8.167% 113 1.35x 67.72%
30/360................ 14 20,261,503 2.22 8,343,003 8.234 144 1.51 53.43
--- ------------ -------- ----- --- ----- -----
Totals/Wtd. Avg. ... 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ======== ===== === ===== =====
</TABLE>
For purposes of the foregoing table, we have assumed that the ARD Loans
mature on their respective anticipated repayment dates.
Balloon Loans. One hundred sixty of the mortgage loans that we intend to
include in the trust, representing 81.34% of the initial mortgage pool balance,
are characterized by--
- an amortization schedule that is significantly longer than the actual
term of the mortgage loan, and
- a substantial payment, or balloon payment, being due with respect to the
mortgage loan on its stated maturity date.
One of these balloon mortgage loans, representing 1.49% of the initial
mortgage pool balance, provides for monthly payments of interest only through
and including April 1, 2002 and thereafter provides monthly payments of interest
and principal. Each of the remaining 159 of these balloon mortgage loans
currently provides for monthly amortization.
ARD Loans. Two of the mortgage loans that we intend to include in the
trust, representing 14.83% of the initial mortgage pool balance, are
characterized by the following features:
- A maturity date that is generally thirty years following origination.
- The designation of an anticipated repayment date that is generally ten
years following origination. The anticipated repayment date for each of
the ARD Loans is listed on Annex A to this prospectus supplement.
- The ability of the related borrower to prepay the mortgage loan, without
restriction, including without any obligation to pay a prepayment premium
or a yield maintenance charge, at any time on or after a date that is
generally two to three months prior to the related anticipated repayment
date.
- Until its anticipated repayment date, the calculation of interest at its
initial mortgage interest rate.
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<PAGE> 51
- From and after its anticipated repayment date, the accrual of interest at
a revised annual rate that is equal to the sum of--
1. its initial mortgage interest rate, plus
2. a specified margin of not more than two (2) percentage points.
- The deferral of any additional interest accrued with respect to the
mortgage loan from and after the related anticipated repayment date at
the difference between its revised mortgage interest rate and its initial
mortgage interest rate. This Post-ARD Additional Interest may, in some
cases, to the extent permitted by applicable law, compound at the new
revised mortgage interest rate. Any Post-ARD Additional Interest accrued
with respect to the mortgage loan following its anticipated repayment
date will not be payable until the entire principal balance of the
mortgage loan has been paid in full.
- From and after its anticipated repayment date, the accelerated
amortization of the mortgage loan out of any and all monthly cash flow
from the corresponding mortgaged real property that remains after payment
of the applicable monthly debt service payments and permitted operating
expenses and capital expenditures and the funding of any required
reserves. These accelerated amortization payments and the Post-ARD
Additional Interest are considered separate from the monthly debt service
payments due with respect to the mortgage loan.
In the case of each of the ARD Loans that we intend to include in the
trust, the related borrower has either entered into a cash management agreement
or has agreed to enter into a cash management agreement on or prior to the
related anticipated repayment date if it has not previously done so. The related
borrower or the manager of the corresponding mortgaged real property will be
required under the terms of that cash management agreement to deposit or cause
the deposit of all revenue from that property received after the related
anticipated repayment date into a designated account controlled by the lender
under the ARD Loan.
Fully Amortizing Loans. Eighteen of the mortgage loans that we intend to
include in the trust, representing 3.83% of the initial mortgage pool balance,
are characterized by--
- constant monthly debt service payments throughout the substantial term of
the mortgage loan, and
- an amortization schedule that is approximately equal to the actual term
of the mortgage loan.
However, none of these fully amortizing loans has either--
- an anticipated repayment date, or
- the associated repayment incentives.
Amortization of Principal. The tables below show the indicated
information for the specified sub-groups of pooled mortgage loans. For purposes
of the following tables, we
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<PAGE> 52
have assumed that the ARD Loans mature on their respective anticipated repayment
dates.
MORTGAGE LOAN TYPE
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
% OF INITIAL MAXIMUM --------------------------------------------
NUMBER OF TOTAL CUT-OFF MORTGAGE CUT-OFF DATE MORTGAGE STATED U/W CUT-OFF DATE
MORTGAGE DATE PRINCIPAL POOL PRINCIPAL INTEREST REMAINING NCF LOAN-TO-VALUE
LOAN TYPE LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR RATIO
--------- --------- -------------- ------------ ------------ -------- ---------- ---- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balloon Loan........... 160 $743,965,745 81.34% $ 35,364,183 8.230% 112 1.31x 69.94%
ARD Loan............... 2 135,665,960 14.83 119,577,993 7.851 113 1.59 55.31
Fully Amortizing
Loan................. 18 35,029,355 3.83 8,145,364 8.095 155 1.25 60.32
--- ------------ ------ ----- --- ---- -----
Totals/Wtd. Avg. .... 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ==== =====
</TABLE>
LOAN TERM, AMORTIZATION TERM AND SEASONING BY MORTGAGE LOAN TYPE
<TABLE>
<CAPTION>
WEIGHTED AVERAGE
------------------------
ORIGINAL CALCULATED REMAINING CALCULATED
NUMBER TOTAL % OF INITIAL TERM TO ORIGINAL TERM TO REMAINING
OF CUT-OFF MORTGAGE MATURITY/ AMORTIZATION MATURITY/ AMORTIZATION
MORTGAGE DATE PRINCIPAL POOL ARD TERM SEASONING ARD TERM
LOAN TYPE LOANS BALANCE BALANCE (MONTHS) (MONTHS) (MONTHS) (MONTHS) (MONTHS)
--------- -------- -------------- -------------- --------- ------------ --------- --------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balloon.............. 160 $743,965,745 81.34%
Minimum............ 60 240 0 52 212
Maximum............ 144 360 44 142 360
Wtd. Avg........... 119 348 7 112 341
ARD.................. 2 135,665,960 14.83
Minimum............ 120 360 6 105 345
Maximum............ 120 360 15 114 354
Wtd. Avg........... 120 360 7 113 353
Fully Amortizing..... 18 35,029,355 3.83
Minimum............ 120 120 1 100 100
Maximum............ 240 240 79 234 234
Wtd. Avg........... 182 182 27 155 155
------- ------------ -------- ------- ------- ------- ------- -------
Totals/Wtd. Avg...... 180 $914,661,061 100.00% 121 343 8 113 336
======= ============ ======== ======= ======= ======= ======= =======
</TABLE>
Voluntary Prepayment Provisions. One hundred seventy-seven of the
mortgage loans that we intend to include in the trust, representing 97.94% of
the initial mortgage pool balance, provided as of the cut-off date for--
- a prepayment lock-out period or a prepayment lock-out/defeasance period
during which voluntary prepayments are prohibited, followed by
- in some cases, a prepayment consideration period during which any
voluntary principal prepayment must be accompanied by prepayment
consideration, followed by
- an open prepayment period during which voluntary principal prepayments
may be made without any prepayment considerations.
Three of the mortgage loans that we intend to include in the trust,
representing 2.06% of the initial mortgage pool balance, provided as of the
cut-off date for--
- a prepayment consideration period, followed by
- an open prepayment period.
The prepayment terms of each of the mortgage loans that we intend to
include in the trust are more particularly described in Annex A to this
prospectus supplement.
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Generally, the prepayment restrictions relating to each of the pooled
mortgage loans do not apply to prepayments arising out of a casualty or
condemnation of the corresponding mortgaged real property. In addition,
prepayments of this type are generally not required to be accompanied by any
prepayment consideration. The aggregate characteristics of the prepayment
provisions of the pooled mortgage loans will vary over time as--
- lock-out periods expire and mortgage loans enter periods during which
prepayment consideration may be required in connection with principal
prepayments and, thereafter, enter open prepayment periods, and
- mortgage loans are prepaid, repurchased, replaced or liquidated following
a default or as a result of a delinquency.
As described under "--Defeasance Loans" below, one hundred thirty of the
pooled mortgage loans, representing 90.10% of the initial mortgage pool balance,
will permit the related borrower to obtain a full or partial release of the
corresponding mortgaged real property or properties from the related mortgage
lien by delivering U.S. government securities as substitute collateral. Except
as described below under "--Defeasance Loans", none of these mortgage loans will
permit defeasance prior to the second anniversary of the date of initial
issuance of the offered certificates.
Prepayment Lock-out and/or Defeasance Periods. One hundred seventy six of
the mortgage loans that we intend to include in the trust, representing 97.80%
of the initial mortgage pool balance, provide for prepayment lock-out periods as
of the cut-off date. For these mortgage loans--
- the maximum remaining prepayment lock-out period as of that date,
including any part of the relevant period during which a defeasance could
occur, is 231 months,
- the minimum remaining prepayment lock-out period as of that date,
including any part of the relevant period during which a defeasance could
occur, is 7 months, and
- the weighted average remaining prepayment lock-out period as of that
date, including any part of the relevant period during which a defeasance
could occur, is 105 months.
Prepayment Consideration. Fifty of the mortgage loans that we intend to
include in the trust, representing 9.90% of the initial mortgage pool balance,
provide for the payment of prepayment consideration in connection with a
voluntary prepayment during part of the loan term, commencing either immediately
following the origination date or at the expiration of an initial prepayment
lock-out period. That prepayment consideration is calculated:
- on the basis of a yield maintenance formula that is, in some cases,
subject to a minimum prepayment premium equal to a specified percentage
of the principal amount prepaid; or
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- as a percentage, which may decline over time, of the amount prepaid; or
- as a combination of these two methods.
Prepayment premiums and yield maintenance charges received on the pooled
mortgage loans, whether in connection with voluntary or involuntary prepayments,
will be allocated and paid to the persons, in the amounts and in accordance with
the priorities described under "Description of the Offered
Certificates--Payments--Payments of Prepayment Premiums and Yield Maintenance
Charges" in this prospectus supplement. Limitations may exist under applicable
state law on the enforceability of the provisions of the pooled mortgage loans
that require payment of prepayment premiums or yield maintenance charges.
Neither we nor any of the underwriters makes any representation or warranty as
to the collectability of any prepayment premium or yield maintenance charge with
respect to any of those mortgage loans. See "Certain Legal Aspects of Mortgage
Loans--Default Interest and Limitations on Prepayments" in the accompanying
prospectus.
Due-on-Sale and Due-on-Encumbrance Provisions. All of the mortgage loans
that we intend to include in the trust contain both a due-on-sale clause and a
due-on-encumbrance clause. In general, except for the permitted transfers
discussed in the next paragraph, these clauses either--
- permit the holder of the related mortgage to accelerate the maturity of
the mortgage loan if the borrower sells or otherwise transfers or
encumbers the corresponding mortgaged real property, or
- prohibit the borrower from doing so without the consent of the holder of
the mortgage.
See "Legal Aspects of Mortgage Loans--Due-on-Sale and Due-on-Encumbrance
Provisions" in the accompanying prospectus.
All of the mortgage loans that we intend to include in the trust permit one
or more of the following types of transfers:
- transfers of the corresponding mortgaged real property or of ownership
interests in the related borrower if specified conditions are satisfied,
which conditions normally include the reasonable acceptability of the
transferee to the lender;
- a transfer of the corresponding mortgaged real property or of ownership
interests in the related borrower to a person that is affiliated with or
otherwise related to the borrower;
- transfers of the corresponding mortgaged real property to specified
entities or types of entities;
- transfers of ownership interests in the related borrower for
estate-planning purposes; or
- transfers of non-controlling ownership interests in the related borrower.
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Defeasance Loans. One hundred-thirty of the mortgage loans that we intend
to include in the trust, representing 90.10% of the initial mortgage pool
balance, permit the borrower to deliver U.S. Treasury obligations or other
government securities as substitute collateral.
Each of these mortgage loans permits the related borrower, during specified
periods and subject to specified conditions, to pledge to the holder of the
mortgage loan the requisite amount of U.S. Treasury obligations or other
government securities and obtain a full or partial release of the mortgaged real
property or properties. In general, the U.S. Treasury obligations or other
government securities that are to be delivered in connection with the defeasance
of any mortgage loan must provide for a series of payments that--
- will be made on or prior, but as closely as possible, to all successive
due dates through and including the maturity date, and
- will, in the case of each due date, be in a total amount equal to or
greater than the monthly debt service payment, including any applicable
balloon payment, scheduled to be due on that date, with any excess to be
returned to the related borrower.
For purposes of determining the defeasance collateral for an ARD Loan,
however, that mortgage loan will be treated as if a balloon payment is due on
its anticipated repayment date.
If fewer than all of the mortgaged real properties securing any particular
mortgage loan or group of cross-collateralized mortgage loans are to be released
in connection with any defeasance, the requisite defeasance collateral will be
calculated based on the allocated loan amount for the properties to be released
and the portion of the monthly debt service payments attributable to that
allocated loan amount.
In connection with any delivery of defeasance collateral, the related
borrower will be required to deliver a security agreement granting the trust a
first priority security interest in the collateral.
No borrower will be permitted to defease the related mortgage loan prior to
the second anniversary of the date of initial issuance of the offered
certificates, with the following exceptions:
<TABLE>
<CAPTION>
MORTGAGED EARLIEST
REAL PROPERTY DEFEASANCE DATE
------------- ---------------
<S> <C>
Checkmate Apartments................. October 1, 2002
8th Street Apartments................ October 1, 2002
</TABLE>
The respective mortgage loans relating to the mortgaged real properties
identified in the foregoing table, are each the primary asset of a single loan
REMIC. The startup day of each of those single loan REMICs is at least two years
prior to the earliest defeasance date of the related mortgage loan.
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<PAGE> 56
ADDITIONAL LOAN AND PROPERTY INFORMATION
Escrows and Reserves. One hundred sixty-one mortgage loans, representing
90.96% of the initial mortgage pool balance, that are secured by 165 mortgaged
real properties, provide for monthly escrows for real estate taxes for those
mortgaged real properties. One hundred fifty-one mortgage loans, representing
89.35% of the initial mortgage pool balance, that are secured by 155 mortgaged
real properties, currently provide for monthly escrows for property insurance
for those mortgaged real properties. For those mortgaged real properties where
real estate taxes or property insurance are not currently escrowed, it is
typically the case that the property is occupied by a single tenant who is
responsible for paying real estate taxes or insurance directly.
One hundred thirty-six mortgage loans, representing 86.38% of the initial
mortgage pool balance and that are secured by 140 mortgaged real properties,
have an initial escrow deposit or an ongoing monthly deposit for replacement
reserves. Shown in Annex A is the amount of funds deposited into the replacement
reserves escrow account at loan origination and the annualized monthly escrow
deposit, if any. In some cases, the initial deposit amount may have been funded
with a letter of credit in lieu of a cash deposit.
The monthly escrow deposit for replacement reserves used to determine the
annualized figure is the monthly escrow amount that was collected in October
2000. There is no assurance that this amount will continue to be escrowed in the
future. In some instances, the borrower may be released from its obligation to
fund a monthly replacement reserves escrow upon specified conditions being met,
such as a maximum escrow balance being attained, a certain date being reached,
or a certain tenant signing or extending its lease. Likewise, there may be cases
where, although there is currently no monthly escrow amount, one may be required
to be funded in the future, upon certain trigger events.
One hundred twenty-nine mortgaged real properties, securing 80.22% of the
initial mortgage pool balance, are properties for which tenant improvements and
leasing commissions are applicable. Seventy-seven of the mortgage loans, secured
by 80 mortgaged real properties and representing 76.95% of the total cut-off
date principal balance of mortgage loans secured by real properties for which
tenant improvements and leasing commissions are applicable, provide for an
initial escrow deposit or an ongoing monthly deposit for a tenant improvements
and leasing commissions reserve. Shown in Annex A is the amount of funds
deposited into the tenant improvements and leasing commissions reserve account
at loan origination and the annualized monthly escrow deposit, if any. In some
cases, the initial deposit amount may have been funded with a letter of credit
or surety bond in lieu of a cash deposit.
The monthly escrow deposit for tenant improvements and leasing commissions
used to determine the annualized figure is the monthly escrow amount that was
collected in October 2000. There is no assurance that this amount will continue
to be escrowed in the future. In some instances, the borrower may be released
from its obligation to fund a monthly tenant improvement and leasing commission
reserve upon certain conditions being met, such as a maximum escrow balance
being attained, a certain date being
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<PAGE> 57
reached, or a certain tenant signing or extending its lease. Likewise, there may
be cases where although there is currently no monthly escrow amount, one may be
required to be funded in the future, upon certain trigger events.
Holdbacks. Six of the mortgage loans, representing 4.05% of the initial
mortgage pool balance, provide for material performance holdbacks under which a
portion of the original loan amount disbursed by the originating lender was
placed into an escrow account at closing, to be released upon the satisfaction
of certain conditions by the borrower. Although there is no specific date by
which the borrower is required to satisfy the specified conditions, in the event
of any default by the borrower, the lender has the right, in addition to its
other remedies, to use the escrowed monies to pay down the principal balance of
the mortgage loan. In such event, the amount of principal repaid would be
subject to a prepayment premium as specified in the related mortgage note.
The achievement of the specified conditions necessary to release an
escrowed holdback is typically contingent upon the performance of the related
mortgaged real property, including an increase in the related mortgaged real
property's net cash flow. If the specified conditions are not achieved,
regardless of whether or not the escrowed holdback is used to pay down the
principal balance of the mortgage loan, as described above, the borrower will
still be required to pay a monthly debt service amount that is based upon the
entire loan amount.
For the six mortgage loans identified above, the Cut-off Date LTV Ratio is
equal to the greater of (a) the related cut-off date principal balance, less the
amount of the holdback, divided by the current "as is" appraised value of the
mortgaged real property, or (b) the cut-off date principal balance divided by
the "stabilized" appraised value of the mortgaged real property. In general, the
stabilized appraised value contained in the appraisal has certain conditions and
assumptions that are consistent with the release conditions of the holdback for
the related mortgage loan. In the event no stabilized appraised value was given
in the appraisal, the current "as is" appraised value was used. These
calculations, and the respective release conditions, are further described in
the tables below:
<TABLE>
<CAPTION>
CUT-OFF DATE
CUT-OFF PRINCIPAL CURRENT STABILIZED
DATE PRINCIPAL HOLDBACK BALANCE LESS APPRAISED APPRAISED APPRAISAL
PROPERTY NAME BALANCE AMOUNT HOLDBACK VALUE VALUE DATE
------------- -------------- ---------- ------------ ----------- ----------- ---------
<S> <C> <C> <C> <C> <C> <C>
Amerix Building............. $14,401,991 $2,000,000 $12,401,991 $19,500,000 $23,000,000 01/20/00
601-609 Mission Street...... $ 7,372,989 $ 500,000 $ 6,872,989 $15,800,000 $15,800,000 03/20/00
Tivoli Gardens Apartments... $ 4,369,641 $ 300,000 $ 4,069,641 $ 6,000,000 $ 6,200,000 10/11/99
Franklinton Square Shopping
Center.................... $ 4,183,600 $ 209,000 $ 3,974,600 $ 5,400,000 $ 5,400,000 12/29/99
The Cascades................ $ 3,963,920 $ 400,000 $ 3,563,920 $ 5,850,000 $ 6,000,000 06/25/99
K-Mart Shopping Center --
Salem..................... $ 2,791,494 $ 200,000 $ 2,591,494 $ 3,700,000 $ 3,700,000 10/20/99
</TABLE>
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<PAGE> 58
<TABLE>
<CAPTION>
CUT-OFF DATE CUT-OFF DATE CUT-OFF DATE
PRINCIPAL BALANCE PRINCIPAL BALANCE/ PRINCIPAL
LESS HOLDBACK/ STABILIZED BALANCE/ CURRENT CUT-OFF DATE
PROPERTY NAME CURRENT APPRAISED VALUE APPRAISED VALUE APPRAISED VALUE LTV RATIO
------------- ----------------------- ------------------ ----------------- ------------
<S> <C> <C> <C> <C>
Amerix Building....................... 63.60% 62.62% 73.86% 63.60%
601-609 Mission Street................ 43.50% 46.66% 46.66% 46.66%
Tivoli Gardens Apartments............. 67.83% 70.48% 72.83% 70.48%
Franklinton Square Shopping Center.... 73.60% 77.47% 77.47% 77.47%
The Cascades.......................... 60.92% 66.07% 67.76% 66.07%
K-Mart Shopping Center -- Salem....... 70.04% 75.45% 75.45% 75.45%
</TABLE>
<TABLE>
<CAPTION>
PROPERTY NAME CONDITIONS FOR HOLDBACK RELEASE
------------- -------------------------------
<S> <C>
Amerix Building............... The completion of the buildout of the second floor, the
commencement of rent in an amount not less than $2,552,725
per annum and receipt of a tenant estoppel.
601-609 Mission Street........ The leasing of basement space for at least one year at
$62,250 per annum. Tenant must occupy & pay rent for three
months. The holdback is in the form of a letter of credit.
Tivoli Gardens Apartments..... The achievement of a minimum debt service coverage ratio of
1.25 to 1.0 for 12 consecutive months; vacancy factor no
greater than 10%; an appraisal indicating a loan-to-value
ratio no greater than 70% of current principal balance or an
appraised value of not less than $6,825,000; Choice Point
reports relative to each holder of beneficial interest
greater than 20%; and required certificates of occupancy
have been obtained.
Franklinton Square Shopping
Center...................... The maintenance of a 94.05% physical in-line occupancy with
an average inline base rent of $7.22 psf for four
consecutive months at a minimum debt service coverage ratio
of 1.20 to 1.0. The holdback is in the form of a letter of
credit.
The Cascades.................. The achievement of a minimum economic occupancy level of
approximately 92%; tenants taking physical occupancy, open
for business, paying all fees, deposits and rent for at
least three calendar consecutive months and no breach or
default; a minimum debt service coverage ratio of 1.25 to
1.0 for six consecutive months, and receipt of tenant
estoppels and SNDA's from at least 75% of tenants, including
the ten largest tenants and all new tenants leasing 90 days
prior to closing.
K-Mart Shopping
Center -- Salem............. Released when tenant Jack in the Box opens for business and
begins paying rent and specified parking lot repairs are
completed.
</TABLE>
Delinquencies. None of the mortgage loans that we intend to include in
the trust was, as of the cut-off date, more than 30 days delinquent with respect
to any monthly debt service payment.
Tenant Matters. Described and listed below are special considerations
regarding tenants at the mortgaged real properties securing the mortgage loans
that we intend to include in the trust--
- One hundred two of the mortgaged real properties, securing 53.44% of the
initial mortgage pool balance, are, in each case, a commercial property
that is leased to one or more tenants that each occupy at least 25% or
more of the net rentable area of the particular property. A number of
companies are tenants at more than one of the mortgaged real properties.
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<PAGE> 59
- Forty-one of the mortgaged real properties, securing 23.84% of the
initial mortgage pool balance, are commercial properties that are each
leased to a tenant that occupies all or substantially all of the
particular mortgaged property.
- There are several cases in which a particular entity is a tenant at more
than one of the mortgaged real properties, and although it may not be a
major tenant at any of those properties, it is significant to the success
of the properties.
- Three of the mortgaged real properties, securing 0.61% of the initial
mortgage pool balance, are multifamily rental properties that have
material concentrations of student tenants.
Cross-easement and Revenue Allocation Agreements. The property identified
on Annex A to this prospectus supplement as Traders Tower-Self Park, a parking
garage in downtown Chicago, Illinois securing 0.91% of the initial mortgage pool
balance, is subject to a cross-easement agreement that benefits and burdens the
property and a revenue allocation agreement, in each case, with a neighboring
parking garage owned by an affiliate of the Traders Tower-Self Park borrower.
The parking garages are jointly operated as a combined parking garage pursuant
to operating leases to another affiliate of the Traders Tower-Self Park
borrower. Each garage has its own public right-of-way access entrance and exit.
The cross-easement agreement, among other things, provides that a parking garage
customer may enter into one garage and exit via the other garage. There are no
assurances that the cross-easement and revenue allocation agreements and the
resultant benefits accruing to the Traders Tower-Self Park property will remain
in effect, and the agreements may be terminated at will by either the Traders
Tower-Self Park borrower or the owner of the neighboring parking garage at any
time for any reason, including without limitation (i) in connection with a
default under either the cross-easement agreement or revenue allocation
agreement, (ii) a casualty or condemnation at either parking garage or (iii) the
sale or other change in ownership or control of the neighboring parking garage.
Further, the allocation of revenue at the parking garages pursuant to the
revenue allocation agreement may not be representative of the performance of the
Traders Tower-Self Park property if it is operated as a separate parking garage
in the absence of the cross-easement and revenue allocation agreements. Since
the parking garages have been operated jointly as a combined parking garage,
there is no historical operating history for the Traders Tower-Self Park
property as a separate parking garage in the absence of the benefits of the
cross-easement and revenue allocation agreements.
Ground Leases. Ten of the mortgage loans that we intend to include in the
trust, representing 5.03% of the initial mortgage pool balance, are secured, in
whole or in material part, by a mortgage lien on the borrower's leasehold
interest in the corresponding mortgaged real property. In five of those cases,
representing 2.36% of the initial mortgage pool balance, the holder of the fee
interest in the property that is covered by the subject ground lease has
subordinated that fee interest to the related mortgage instrument; however,
there is no assurance that the subject ground lease contains standard mortgagee
protection provisions or that the fee owner is a special purpose entity or
bankruptcy remote. In four of the remaining five cases, where the fee
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interest has not been subordinated to the related mortgage instrument, the
ground lessor has agreed to give the holder of that mortgage loan notice of, and
the right to cure, any default or breach by the ground lessee. Also, in four
different remaining cases, where the fee interest has not been subordinated to
the related mortgage instrument, the term of the related ground lease, giving
effect to all extension options, expires more than 20 years after the stated
maturity of the related mortgage loan. In the case of the mortgaged real
property identified on Annex A to this prospectus supplement as Tolt Towne
Center, securing 0.14% of the initial mortgage pool balance, the property is
held by the related borrower as 99% fee and 1% leasehold. The Tolt Towne Center
ground lease has a perpetual duration and no landlord right to terminate, but
lacks other standard mortgagee protections. In the case of the mortgaged real
property identified on Annex A to this prospectus supplement as 29200
Northwestern Highway, the related mortgage loan seller reserved the total amount
of $350,000 as additional security in anticipation of the purchase of a portion
of the property that is ground leased by the related borrower. The 29200
Northwestern Highway ground lease does not contain standard mortgagee
protections.
See "Certain Legal Aspects of Mortgage Loans--Foreclosure--Leasehold
Considerations" in the accompanying prospectus.
Additional and Other Financing. We are aware of one mortgage loan that we
intend to include in the trust, representing 3.87% of the initial mortgage pool
balance, that currently has unsecured debt outstanding in addition to trade
receivables and other debts incurred in the ordinary course of business:
<TABLE>
<CAPTION>
% OF INITIAL OUTSTANDING
PROPERTY NAME MORTGAGE POOL BALANCE UNSECURED DEBT
------------- --------------------- --------------
<S> <C> <C>
Medical Mutual of Ohio...................... 3.87% $11,942,000
</TABLE>
Two mortgage loans that we intend to include in the trust, representing
13.88% of the initial mortgage pool balance, permit limited amounts of unsecured
debt in addition to trade receivables and other debts incurred in the ordinary
course of business:
<TABLE>
<CAPTION>
% OF INITIAL LIMIT ON
PROPERTY NAME MORTGAGE POOL BALANCE UNSECURED DEBT
------------- --------------------- --------------
<S> <C> <C>
One Financial Place......................... 13.07% $2,400,000
601-609 Mission Street...................... 0.81% $ 170,000
</TABLE>
Forty-three of the mortgage loans that we intend to include in the trust,
representing 5.69% of the initial mortgage pool balance, do not have any
limitations on the related borrower's ability to incur unsecured debt.
In the case of some of the mortgage loans that we intend to include in the
trust, one or more of the principals of the related borrower have incurred or
are permitted to incur mezzanine debt. Mezzanine debt is debt that is secured by
the principal's ownership interest in the borrower. This type of financing
effectively reduces the indirect equity interest of any principal in the
corresponding mortgaged real property. While the mezzanine lender has no
security interest in or rights to the related mortgaged real properties, a
default under the mezzanine loan could cause a change in control of the related
borrower.
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Except as disclosed under this "--Additional and Other Financing"
subsection and "Risk Factors--Risks Related to the Underlying Mortgage
Loans--The Underlying Mortgage Loans Have a Variety of Characteristics that May
Expose Investors to Greater Risk of Default and Loss--Some of the Underlying
Borrowers Have Incurred Other Debt" in this prospectus supplement, we have not
been able to confirm whether the respective borrowers under the mortgage loans
that we intend to include in the trust have any other debt outstanding.
UNDERWRITING MATTERS
General. In connection with the origination of each of the mortgage loans
that we intend to include in the trust, the related originator of the mortgage
loan evaluated the corresponding mortgaged real property or properties in a
manner generally consistent with the standards described below.
Environmental Reports. Except for one mortgaged real property, securing
0.09% of the initial mortgage pool balance, a third-party environmental
consultant prepared an Environmental Report, or updated a previously prepared
Environmental Report, for each mortgaged real property securing a mortgage loan
that we intend to include in the mortgage pool. Those Environmental Reports were
prepared or updated--
- in the case of 114 mortgaged real properties, securing 77.25% of the
initial mortgage pool balance, during the 12-month period ending on
November 30, 2000,
- in the case of 43 mortgaged real properties, securing 16.53% of the
initial mortgage pool balance, during the 12-month period ending on
November 30, 1999, and
- in the case of 26 mortgaged real properties, securing 6.14% of the
initial mortgage pool balance, on or before November 30, 1998.
For one mortgaged real property, securing 0.09% of the initial mortgage
pool balance, the mortgage loan originator engaged an environmental consultant
to review a Phase II environmental report prepared three years earlier by that
consultant for another lender. Based solely upon its review of this report,
confirmation that the use of the mortgaged real property had not changed and
confirmation that no new LUST sites were identified in the area, the consultant
concluded that there was no further investigation required.
In the case of one hundred eighty-two mortgaged real properties,
representing 99.80% of the initial mortgage pool balance, the Environmental
Reports were Phase I environmental studies meeting ASTM standards. In the case
of one mortgaged real property, representing 0.11% of the initial mortgage pool
balance, the above-referenced Environmental Report was an environmental
screening assessment. See "Risk Factors--Lending on Income-Producing Real
Properties Entails Environmental Risks" in this prospectus supplement. The
environmental investigation at any particular mortgaged real property did not
necessarily cover all potential environmental issues. For example, tests for
radon, lead-based paint, lead in drinking water and lead in water were generally
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<PAGE> 62
performed only at multifamily rental properties and only when the originator of
the related mortgage loan believed this testing was warranted under the
circumstances.
The above-described environmental investigation identified various adverse
or potentially adverse environmental conditions at some of the mortgaged real
properties. In many cases, the identified condition related to the presence of
asbestos-containing materials, lead-based paint and/or radon. Where these
substances were present, and depending upon the condition of the substances, the
environmental consultant generally recommended, and the related loan documents
then required--
- the establishment of an operation and maintenance plan to address the
issue, or
- an abatement or removal program and, where appropriate, a notification
program.
In other cases, where the environmental consultant recommended specific
remediation of an adverse environmental condition, the related originator of the
mortgage loan in substantially all cases required the related borrower:
1. to carry out the specific remedial measures prior to closing;
2. to carry out the specific remedial measures post-closing and deposit
with the lender a cash reserve in an amount equal to 100% to 125% of the
estimated cost to complete the remedial measures; or
3. to provide environmental insurance.
However, some borrowers under the mortgage loans have not satisfied all
post-closing obligations required by the related loan documents with respect to
environmental matters. There can be no assurance that these obligations or the
recommended operations and maintenance plans have been or will continue to be
implemented or that the cost of implementing them will not exceed the estimate.
If any adverse environmental conditions are not properly addressed or monitored
and maintained over time by the related borrower, it could result in a
significant loss or environmental liability for the trust.
In a few cases, residual contamination does or will remain at a mortgaged
real property after remedial action is performed. While the presence of this
residual contamination may be acceptable today, there can be no assurance that
future legal requirements, prospective purchasers or future owners will not
require additional cleanup.
In a few cases, the environmental consultant did not recommend that any
action be taken with respect to a potential adverse environmental condition at a
mortgaged real property because the responsible party or parties with respect to
that condition had already been identified, or because the responsible party or
parties currently monitor actual or potential adverse environmental conditions
at that property, or because the levels of hazardous substances at that property
were found to be below or very close to applicable thresholds for reporting,
abatement or remediation. However, there can be no assurance that the
responsible party or parties, in each case, are financially able or will
actually correct the problem. In some of these cases, the responsible party or
parties
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<PAGE> 63
have installed monitoring wells on the mortgaged real property and/or need
access to the mortgaged real property for monitoring or to perform remedial
action.
In some cases, the Environmental Report for a mortgaged real property
identified potential environmental problems at nearby properties, including but
not limited to spills of hazardous materials and leaking underground storage
tanks. In those cases, either environmental insurance was obtained or these
Environmental Reports indicated that--
- the subject mortgaged real property had not been affected or had been
minimally affected,
- the potential for the problem to affect the subject mortgaged real
property was limited,
- the person or persons responsible for remediation had been identified, or
- no evidence suggested adverse environmental impact to the subject
mortgaged real property.
In those cases where the party or parties responsible for remediation had been
identified, there can be no assurance that such party or parties, in each case,
are financially able or will actually correct the problem.
The information contained in this prospectus supplement regarding
environmental conditions at the mortgaged real properties is based on the
environmental site assessments referred to in this "--Environmental Reports"
subsection and has not been independently verified by--
- us,
- any of the mortgage loan sellers,
- any of the underwriters,
- the master servicer,
- the special servicer,
- the trustee, or
- the affiliates of any of these parties.
There can be no assurance that the environmental assessments or studies, as
applicable, identified all environmental conditions and risks at, or that any
environmental conditions will not have a material adverse effect on the value of
or cash flow from, one or more of the mortgaged real properties or will not
result in a claim for damages by a party injured by the condition.
The pooling and servicing agreement requires that the special servicer
obtain an environmental site assessment of a mortgaged real property prior to
acquiring title to the property or assuming its operation. This requirement
precludes enforcement of the security for the related mortgage loan until a
satisfactory environmental site assessment is obtained or until any required
remedial action is taken. In addition, there can be no assurance that the
requirements of the pooling and servicing agreement will effectively
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insulate the trust from potential liability for a materially adverse
environmental condition at any mortgaged real property.
Environmental Insurance. In the case of two mortgaged real properties,
securing 1.17% of the initial mortgage pool balance, the related mortgage loan
seller has obtained, or has the benefit of, and there will be assigned to the
trust, an impaired property policy covering select environmental matters. In
each of these cases the environmental policy is an individual policy that
insures only the related mortgaged real property.
The premium for each of the environmental policies has been or, as of the
date of initial issuance of the series 2000-C3 certificates, will be, paid in
full.
In the case of one mortgage loan, secured by the mortgaged real property
identified on Annex A to this prospectus supplement as Boynton Plaza, the
individual insurance policy was issued by American International Specialty Lines
Insurance Company and generally provides coverage for the following losses,
subject to the coverage limits discussed below, and further subject to the
policy's conditions and exclusions:
- if during the term of the policy, the borrower defaults under its
mortgage loan and adverse environmental conditions exist at levels above
legal limits on the related mortgaged real property, prior to foreclosure
the insurer will indemnify the insured for the outstanding principal
balance of the subject mortgage loan on the date of default, together
with accrued interest from the date of default until the date that the
outstanding principal balance is paid;
- if the insured becomes legally obligated to pay as a result of a claim
first made against the insured and reported to the insurer during the
term of the policy, for bodily injury, property damage or legally
required clean-up costs resulting from adverse environmental conditions
on or emanating from the related mortgaged real property, the insurer
will defend against and pay that claim; and
- if the insured enforces the related mortgage instrument, the insurer will
thereafter pay legally required clean-up costs for adverse environmental
conditions at levels above legal limits which exist on or under the
acquired mortgaged real property, provided that the insured reported
those conditions to the government in accordance with applicable law.
In the case of the other mortgage loan, secured by the mortgaged real
property identified on Annex A to this prospectus supplement as Sav-on and
Carl's Jr., the insurance policy was issued by Gulf Underwriters Insurance
Company and generally provides coverage for the following losses, subject to the
coverage limits discussed below, and further subject to the policy's conditions
and exclusions:
- if during the term of the policy, the borrower defaults under its
mortgage loan, adverse environmental conditions exist at levels above
legal limits on the related mortgaged real property, and the insured has
or may have a legal obligation to incur clean-up costs, prior to
foreclosure the insurer will indemnify the insured for the outstanding
principal balance of the subject mortgage loan on the date of
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default, together with accrued interest from the date of default until
the date that the outstanding principal balance is paid;
- if the insured becomes legally obligated to pay as a result of a claim
first made against the insured and reported to the insurer during the
term of the policy, for bodily injury, property damage or legally
required clean-up costs resulting from adverse environmental conditions
existing at levels above legal limits on or emanating from the related
mortgaged real property, and the insured has or may have a legal
obligation to cleanup such conditions, the insurer will defend against
and pay that claim; and
- if the insured enforces the related mortgage instrument, the insurer will
thereafter pay legally required clean-up costs for adverse environmental
conditions at levels above legal limits which exist on or under the
acquired mortgaged real property and which conditions were discovered
during the policy period, provided that the insured reported those
conditions to the government in accordance with applicable law.
For purposes of the above-referenced impaired property policies, the mere
presence of adverse environmental conditions at levels above legal limits on the
related mortgaged real property is not deemed a cause or event of default.
Also, the policies require that the insured report a claim soon after
certain events.
The policies do not provide coverage for the following, in addition to
other excluded matters:
- claims arising from pollution on the subject property that was known to
the insured, but not reported to the insurer, as of the time the policy
was issued; or
- claims arising out of conditions involving lead-based paint or asbestos.
The environmental policy for Boynton Plaza:
- has a policy period that runs from July 12, 2000 to July 12, 2015; and
- provides for a per incident limit of $9,625,000 and a total limit on
liability of $9,625,000.
The environmental policy for Sav-on and Carl's Jr.:
- has a policy period that runs from August 31, 2000 to August 31, 2013;
and
- provides for a per incident limit of $3,750,000 and a total limit of
liability of $3,750,000.
Property Condition Assessments. One hundred eighty-two of the mortgaged
real properties, securing 99.13% of the initial mortgage pool balance, were
inspected by professional engineers or architects. One hundred twelve of the
mortgaged real properties, securing 77.68% of the initial mortgage pool balance,
were inspected during the 12-month period preceding the cut-off date.
Forty-seven of the mortgaged real properties, securing 17.15% of the initial
mortgage pool balance, were inspected during the 12- to 24-month period
preceding the cut-off date. These inspections included an
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assessment of the mortgaged real properties' exterior walls, roofing, interior
construction, mechanical and electrical systems and general condition of the
site, buildings and other improvements located at each of the mortgaged real
properties.
The inspections identified various deferred maintenance items and necessary
capital improvements at some of the mortgaged real properties. The resulting
inspection reports generally included an estimate of cost for any recommended
repairs or replacements at a mortgaged real property. When repairs or
replacements were recommended, the related borrower was required--
- to carry out necessary repairs or replacements, and
- in some instances, to establish reserves, generally in the amount of 125%
of the cost estimated in the inspection report, to fund deferred
maintenance or replacement items that the reports characterized as in
need of prompt attention.
There can be no assurance that another inspector would not have discovered
additional maintenance problems or risks, or arrived at different, and perhaps
significantly different, judgments regarding the problems and risks disclosed by
the respective inspection reports and the cost of corrective action.
Appraisals and Market Studies. An independent appraiser that is
state-certified and/or a member of the Appraisal Institute prepared an appraisal
of each of the mortgaged real properties securing the mortgage loans that we
intend to include in the trust, in order to establish the approximate value of
the property. Those appraisals are the basis for the appraised values for the
respective mortgaged real properties set forth on Annex A to this prospectus
supplement. For 141 of the mortgaged properties, securing 83.53% of the initial
mortgage pool balance, the appraised value is as of a date during the 12-month
period preceding the cut-off date. For 43 of the mortgaged real properties,
securing 16.47% of the initial mortgage pool balance, the appraised value is as
of a date during the 12- to 24-month period preceding the cut-off date.
In some cases, an appraisal contained an "as is" value, with an "as of"
date consistent with the date that the appraisal was prepared, and a
"stabilized" value, with a specified future "as of" date. For mortgaged real
properties where the specified conditions for the stabilized value were met, the
stabilized value "as of " date was used in the above analysis.
Each of the appraisals referred to above represents the analysis and
opinions of the appraiser at or before the origination of the related mortgage
loan. The appraisals are not guarantees of, and may not be indicative of, the
present or future value of the subject mortgaged real property. There can be no
assurance that another appraiser would not have arrived at a different valuation
of any particular mortgaged real property, even if the appraiser used the same
general approach to, and the same method of, appraising that property. Neither
we nor any of the underwriters has confirmed the values of the respective
mortgaged properties in the appraisals referred to above.
In general, appraisals seek to establish the amount a typically motivated
buyer would pay a typically motivated seller. However, this amount could be
significantly
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higher than the amount obtained from the sale of a property under a distress or
liquidation sale.
In all cases, the appraisal upon which the appraised value for each
mortgaged real property is based, or a separate letter, contains a statement by
the respective appraiser, to the effect that the appraisal guidelines set forth
in Title XI of the Financial Institutions Reform, Recovery and Enforcement Act
of 1989 were followed in preparing that appraisal. However, neither we nor any
of the underwriters, the related mortgage loan seller or the related originator
has independently verified the accuracy of this statement.
Zoning and Building Code Compliance. Each mortgage loan seller has, with
respect to its pooled mortgage loans, examined whether the use and operation of
the related mortgaged real properties were in material compliance with all
zoning and land-use ordinance, rules, regulations and orders applicable to those
real properties at the time of origination. The mortgage loan sellers may have
considered--
- legal opinions or zoning consultant's reports,
- certifications from, and/or discussions with, government officials,
- information contained in appraisals, surveys and site plan,
- title insurance endorsements,
- representations by the related borrower contained in the related mortgage
loan documents, or
- property condition assessments undertaken by independent licensed
engineers,
in determining whether the mortgaged real properties were in compliance. No
mortgage loan seller has notice of any material existing violations with respect
to the mortgaged real properties securing its pooled mortgage loans.
In some cases, the use, operation or structure of a mortgaged real property
constitutes a permitted nonconforming use or structure. Generally, the
improvements on that mortgaged real property may not be rebuilt to their current
state in the event that those improvements are materially damaged or destroyed.
Generally, where a mortgaged real property constitutes a permitted nonconforming
use or structure and the improvements on the particular property may not be
rebuilt to their current specifications in the event of a major casualty, the
related mortgage loan seller has determined that one or more of the following
apply:
- the extent of the nonconformity is not material;
- sufficient insurance proceeds would be available to restore the mortgaged
real property in accordance with then-applicable requirements, and the
mortgaged real property, if permitted to be repaired or restored in
conformity with current law, would be adequate security for the related
mortgage loan;
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- the risk that the mortgaged real property would suffer a material
casualty of a magnitude that applicable ordinances would require
conformity with current requirements, is remote; and/or
- the insurance proceeds together with the value of the remaining property
would be sufficient to pay the loan.
There is no assurance, however, that the conclusions of any of the mortgage
loan sellers in this regard are correct, or that the above determinations were
made in each and every case.
Hazard, Liability and Other Insurance. Although exceptions exist, the
loan documents for each of the mortgage loans we intend to include in the trust
generally require the related borrower to maintain with respect to the
corresponding mortgaged real property the following insurance coverage:
- except in the case of mobile home parks, hazard insurance in an amount,
subject to a customary deductible, that is at least equal to the lesser
of--
1. the outstanding principal balance of the mortgage loan, and
2. the full insurable replacement cost of the improvements located on
the insured property;
- if any portion of the property was in an area identified in the federal
register by the Flood Emergency Management Agency as having special flood
hazards, flood insurance meeting the requirements of the Federal
Insurance Administration guidelines in an amount that is equal to the
least of--
1. the outstanding principal balance of the related mortgage loan,
2. the full insurable value of the insured property, and
3. the maximum amount of insurance available under the National Flood
Insurance Act of 1968;
- comprehensive general liability insurance against claims for personal and
bodily injury, death or property damage occurring on, in or about the
insured property, in an amount customarily required by institutional
lenders; and
- business interruption or rent loss insurance either in an amount not less
than 100% of the projected rental income or revenue from the insured
property for at least six months or, alternatively, in an amount as may
be required by the lender.
In general, the mortgaged real properties for the mortgage loans that we
intend to include in the trust, including those properties located in
California, are not insured against earthquake risks. Forty-nine of the
mortgaged real properties, securing 23.24% of the initial mortgage pool balance,
are located in seismic zones 3 and 4, which are areas that are considered to
have a high earthquake risk. In all of these cases, a third-party consultant
conducted seismic studies to assess the probable maximum loss for the property.
In general, those studies were performed in accordance with generally accepted
industry standard assumptions and methodologies. Except in the case of two
mortgaged
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real properties, securing 0.19% of the initial mortgage pool balance, when the
resulting reports indicated a probable maximum loss in excess of 20% of the
estimated replacement cost of the improvements, the related originator required
the borrower to obtain earthquake insurance. However, because the studies did
not all use the same assumptions in assessing probable maximum loss, it is
possible that some of the mortgaged real properties that were considered to not
have a probable maximum loss in excess of 20% of estimated replacement cost
might have been the subject of a higher estimate had different assumptions been
used.
THE ONE FINANCIAL PLACE LOAN.
General Characteristics of the One Financial Place Loan.
<TABLE>
<S> <C>
Cut-Off Date
Principal Balance: $119,577,993
Loan Per Sq. Ft.: $117.31
% of Initial Mortgage
Pool Balance: 13.07%
Mortgage Loan
Seller/Originator: Salomon Brothers
Realty Corp.
ARD Loan: Yes
Initial Mortgage
Interest Rate: 7.89%
Post-ARD Mortgage
Interest Rate: 9.89%
Maturity Date: June 1, 2030
Anticipated Repayment
Date: June 1, 2010
Amortization Term: 360 months
Interest Calculation: Actual/360
Call Protection: LO (30);
Defeasance (87);
Free (3)
Property Type: Office
Net Rentable Sq. Ft.: 1,019,325
Location: Chicago, IL
Year Built/
Renovated: 1984/NAP
Appraised Value: $223,000,000
Appraisal Date: March 1, 2000
Encumbered Interest: Fee Simple
Cut-Off Date LTV
Ratio: 53.62%
Maturity Date/ ARD
LTV Ratio: 47.99%
Occupancy %: 94.58%
U/W DSCR: 1.63x
Occupancy Date: March 13, 2000
Property Manager: Jones Lang
LaSalle
Management
Services,
subcontractor for
440 LaSalle LLC
</TABLE>
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Major Tenants at the One Financial Place Property.
<TABLE>
<CAPTION>
IN-PLACE
% OF IN-PLACE ANNUALIZED
LEASE TOTAL ANNUALIZED BASE RENT
TENANT NAME EXPIRATION TENANT SF TENANT SF BASE RENT PER SQ. FT.
----------- ---------- --------- --------- ---------- -----------
<S> <C> <C> <C> <C> <C>
The Chicago Stock
Exchange.......... 4/05 166,373 16.32% $3,907,163 $23.48
4/15 40,872 4.01% $1,059,287 $25.92
8/00 4,996 0.50% $ 99,920 $20.00
First Options of
Chicago, Inc. .... 2/03 96,474 9.46% $1,903,412 $19.73
4/05 4,220 0.41% $ 76,400 $18.10
The Options Clearing
Corporation....... 1/02 64,459 6.32% $1,628,879 $25.27
Morgan Stanley & Co.
Incorporated...... 12/02 51,634 5.07% $1,244,577 $24.10
ABN AMRO Sage
Corporation,
successor-in-
interest to Sage
Clearing, L.P..... 1/04 51,100 5.01% $1,167,850 $22.85
</TABLE>
Lease Expiration Schedule.
<TABLE>
<CAPTION>
NUMBER OF SQ. FT. OF % OF CUMULATIVE
YEAR OF LEASES LEASES TOTAL % OF
EXPIRATION EXPIRING EXPIRING SQ. FT. TOTAL SQ. FT.
---------- --------- ---------- ------- -------------
<S> <C> <C> <C> <C>
2000.............................. 4 11,152 1.1% 1.1%
2001.............................. 0 0 0.0% 1.1%
2002.............................. 11 142,636 14.0% 15.1%
2003.............................. 7 142,592 14.0% 29.1%
2004.............................. 12 114,044 11.2% 40.3%
2005.............................. 13 284,089 27.9% 68.1%
2006.............................. 1 6,892 0.7% 68.8%
2007.............................. 2 24,912 2.4% 71.3%
2008.............................. 2 10,293 1.0% 72.3%
2009.............................. 4 84,891 8.3% 80.6%
2010.............................. 3 69,158 6.8% 87.4%
</TABLE>
Escrow Schedule.
<TABLE>
<CAPTION>
INITIAL
RESERVE
RESERVE TYPE DEPOSIT ANNUAL RESERVE DEPOSIT
------------ ---------- ----------------------
<S> <C> <C>
Tax and Insurance Escrow.................... $1,622,791 $5,962,403
---------- ----------
Replacement Reserves Escrow................. $ 244,638 $ 244,638
Tenant Improvements and Leasing
Commissions.............................. $2,005,362 $2,005,362
</TABLE>
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Operating History.
<TABLE>
<CAPTION>
1997 1998 1999 UNDERWRITTEN
----------- ----------- ----------- ------------
<S> <C> <C> <C> <C>
Net Operating
Income............. $11,869,899 $16,193,511 $17,621,668 $19,651,616
Net Cash Flow......... -- -- -- $17,029,161
</TABLE>
One Financial Place Borrower. One Financial Place, LP is the borrower
under the One Financial Place Loan. It is--
- a single purpose entity, formed as a limited partnership under the laws
of the State of Delaware,
- owned 0.1% by One Financial Place Corporation, the general partner, 90%
by GENO One Financial Place L.P., and 9.9% by One Financial Place
Holdings, LLC, and
- controlled, through the general partner and the property manager, by The
Travelers Insurance Company, an insurance company.
The Travelers Insurance Company owns all of the issued and outstanding capital
stock of One Financial Place Corporation, the general partner. In addition, The
Travelers Insurance Company is the record and beneficial owner of all of the
issued and outstanding membership interests in One Financial Place Holdings,
LLC, a limited partner. The Travelers Insurance Company is an affiliate of us,
Salomon Smith Barney Inc. and Salomon Brothers Realty Corp.
The One Financial Place Property. The One Financial Place Property is a
1.3 acre property located at 440 South LaSalle in Chicago, Illinois. It is
improved by a 39-story tower primarily of office space that opened in 1984, and
a 5-story annex that includes the Chicago Stock Exchange trading floor and a
health club. The improvements are comprised of 1,019,325 rentable square feet of
office space with a 22-room private hotel and restaurant on the top floor of the
tower and 290 parking spaces provided within below-grade underplaza and
underbuilding parking garages. Based on the March 13, 2000 rent roll, the One
Financial Place Property is 94.58% occupied by a total of forty tenants, with
the five largest tenants accounting for 480,128 square feet or approximately
47.10% of the property's rentable area.
Property Management. The One Financial Place Property is subject to a
management agreement between the related borrower and 440 South LaSalle LLC, an
affiliate of the related borrower, which in turn is party to a subcontract
management agreement with Jones Lang LaSalle Management Services (Illinois),
L.P. n/k/a Jones Lang LaSalle Americas (Illinois), L.P. All of the membership
interests in 440 South LaSalle LLC are held, directly or indirectly, by The
Travelers Insurance Company, who also holds all of the issued and outstanding
stock of One Financial Place Corporation, the sole general partner of the
related borrower.
Cash Management/Lockbox. The borrower under the One Financial Place Loan
must cause all rents from the One Financial Place Property to be deposited
directly by the parking manager or tenants, as applicable, into a lender
controlled rent account. If the borrower or any person acting on behalf of the
borrower receives any rent payment
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directly, it shall cause such payment to be deposited into the lender controlled
rent account within one business day of receipt. Neither the borrower nor any
other person claiming on behalf of or through the borrower shall have any access
to the funds of the rent account.
THE MEDICAL MUTUAL OF OHIO LOAN.
The Medical Mutual of Ohio Loan has a cut-off date principal balance of
$35,364,183, representing 3.87% of the initial mortgage pool balance. The
borrower under the Medical Mutual of Ohio Loan is an affiliate of the Bentley
Forbes Group. Bentley Forbes Group is a privately held real estate investment
trust which specializes in single tenant investment and sale-leaseback
transactions, and had 1999 holdings of $580,000,000. The proceeds of the
mortgage loan financed a sale leaseback with the tenant. Mr. C. Frederick Wehba,
II, president of the Bentley Forbes Group, is the indemnitor for the mortgage
loan.
The Medical Mutual of Ohio Loan is secured by a single tenant office
building located in Cleveland, Ohio. The borrower under the Medical Mutual of
Ohio Loan is MMCO, LLC.
The Medical Mutual of Ohio Loan is a balloon loan which matures on October
1, 2010. The Medical Mutual of Ohio Loan accrues interest through its maturity
date at a mortgage interest rate of 8.38% per annum. Interest accrues on the
Medical Mutual of Ohio Loan on the basis of the actual number of days elapsed
each month in a year assumed to consist of 360 days. The Medical Mutual of Ohio
Loan may not be voluntarily prepaid, in whole or in part, until 90 days prior to
its maturity date. Not earlier than the second anniversary date of the initial
issuance of the offered certificates, the borrower may obtain a release of the
Medical Mutual of Ohio Property from the lien of related mortgage instrument
through a defeasance of the Medical Mutual of Ohio Loan.
The Medical Mutual of Ohio Loan is secured by a vintage ten-story single
tenant office building containing approximately 381,176 net rentable square
feet.
The property is entirely net leased to Medical Mutual of Ohio, Ohio's
oldest and largest health care insurer, which is rated BB(pi) by S&P. The lease
is for a term of 20 years, expiring in 2020, with four 5-year renewal options.
The tenant has no rights to terminate the lease except in connection with a
total condemnation or destruction or substantial damage to the improvements
during the last three years of the lease term. The borrower posted a $3,800,000
surety bond at the closing of the mortgage loan as additional security to cover
re-tenanting costs in the event of a default by the tenant under its lease. The
Appraised Value, determined as of August 1, 2000, of the Medical Mutual of Ohio
Property is $47,800,000, resulting in a Cut-off Date LTV Ratio of 73.98%. The
Underwritten Net Cash Flow for the Medical Mutual of Ohio Property is
$4,019,905, resulting in an Underwritten NCF Debt Service Coverage Ratio of
1.24x.
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THE MORTGAGE LOAN SELLERS
General. We did not originate any of the mortgage loans that we intend to
include in the trust. We will acquire those mortgage loans from the following
entities:
- Salomon Brothers Realty Corp--21 mortgage loans, representing 28.19% of
the initial mortgage pool balance;
- Greenwich Capital Financial Products, Inc.--66 mortgage loans,
representing 36.89% of the initial mortgage pool balance;
- Artesia Mortgage Capital Corporation--66 mortgage loans, representing
12.47% of the initial mortgage pool balance; and
- LaSalle Bank National Association--27 mortgage loans, representing 22.44%
of the initial mortgage pool balance.
Salomon Brothers Realty Corp. SBRC is a New York corporation primarily
engaged in the business of purchasing and originating commercial mortgage loans.
Its principal offices are located in New York, New York. SBRC is a direct,
wholly owned subsidiary of Salomon Brothers Holding Inc. and an affiliate of
both us and Salomon Smith Barney Inc.
Greenwich Capital Financial Products, Inc. GCFP is a Delaware corporation
and is engaged principally in the origination, purchase, sale and financing of
residential and commercial mortgage loans, consumer receivables and other
financial assets. GCFP also provides advisory services to originators and
servicers of those assets. The majority of the assets originated or purchased by
Greenwich are securitized and sold as mortgage-backed or asset-backed securities
through its affiliates. GCFP's principal office is located at 600 Steamboat
Road, Greenwich, Connecticut 06830. GCFP is an indirect wholly-owned subsidiary
of The Royal Bank of Scotland Plc. and an affiliate of Greenwich Capital
Markets, Inc., one of the underwriters.
Artesia Mortgage Capital Corporation. AMCC is a Delaware corporation
engaged in the business of originating and servicing U.S. commercial mortgage
loans and the acquisition of U.S. commercial mortgage-backed securities and
residential mortgages for its own account. Its principal offices are located in
the Seattle suburb of Issaquah, Washington. It is a wholly-owned subsidiary of
Artesia Banking Corporation N.V./S.A., which is a major bank located in
Brussels, Belgium.
LaSalle Bank National Association. LaSalle Bank National Association is a
national banking association whose principal offices are in Chicago, Illinois.
LaSalle Bank is a subsidiary of LaSalle National Corporation, which is a
subsidiary of ABN AMRO Bank N.V., a bank organized under the laws of The
Netherlands. LaSalle Bank is a commercial bank offering a wide range of banking
services to customers in the United States. Its business is subject to
examination and regulation by Federal banking authorities.
The information set forth in this prospectus supplement concerning each of
the mortgage loan sellers has been provided by the respective mortgage loan
sellers, and
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<PAGE> 74
neither we nor any of the underwriters makes any representation or warranty as
to the accuracy or completeness of this information.
ASSIGNMENT OF THE UNDERLYING MORTGAGE LOANS
On or before the date of initial issuance of the offered certificates, each
of the mortgage loan sellers will transfer its pooled mortgage loans to us, and
we will transfer all of the pooled mortgage loans to the trust. In each case,
the transferor will assign the subject mortgage loans, without recourse, to the
transferee.
In connection with the transfers referred to in the prior paragraph, each
mortgage loan seller will be required to deliver the following documents, among
others, to the trustee with respect to each of its mortgage loans:
- either--
1. the original promissory note, endorsed without recourse to the order
of the trustee, or
2. if the original promissory note has been lost, a copy of that note,
together with a lost note affidavit;
- the original or a copy of the related mortgage instrument, together with
originals or copies of any intervening assignments of that document, in
each case, unless the particular document has not been returned from the
applicable recording office, with evidence of recording;
- the original or a copy of any separate assignment of leases and rents,
together with originals or copies of any intervening assignments of that
document, in each case, unless the particular document has not been
returned from the applicable recording office, with evidence of
recording;
- either--
1. a completed assignment of the related mortgage instrument in favor
of the trustee, in recordable form except for missing recording
information, or
2. a certified copy of that assignment as sent for recording;
- either--
1. a completed assignment of any separate related assignment of leases
and rents in favor of the trustee, in recordable form except for
missing recording information, or
2. a certified copy of that assignment as sent for recording;
- originals or copies of any related loan agreements;
- an original or copy of the lender's title insurance policy or, if a title
insurance policy has not yet been issued, a pro forma title policy or a
commitment for title insurance marked-up at the closing of the mortgage
loan; and
- in those cases where applicable, the original or a copy of the related
ground lease.
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<PAGE> 75
The trustee, either directly or through a custodian, is required to hold
all of the documents delivered to it with respect to the pooled mortgage loans
in trust for the benefit of the series 2000-C3 certificateholders. Within a
specified period of time following that delivery, the trustee, directly or
through a custodian, will be further required to conduct a review of those
documents. The scope of the trustee's review of those documents will, in
general, be limited solely to confirming that they have been received. None of
the trustee, the master servicer, the special servicer or any custodian is under
any duty or obligation to inspect, review or examine any of the documents
relating to the pooled mortgage loans to determine whether the document is
genuine, valid, effective, enforceable, in recordable form or otherwise
appropriate for the represented purpose. The trustee shall have no
responsibility for determining whether any document is valid and binding,
whether the text of any assignment or endorsement is in proper or recordable
form, whether any document has been recorded in accordance with the requirements
of any applicable jurisdiction, or whether a blanket assignment is permitted in
any applicable jurisdiction.
If--
- any of the above-described documents required to be delivered by any
mortgage loan seller to the trustee is not delivered or is otherwise
defective, and
- that omission or defect materially and adversely affects the interests of
the series 2000-C3 certificateholders in the subject mortgage loan,
then the omission or defect will constitute a material document defect as to
which the series 2000-C3 certificateholders, or the trustee on their behalf,
will have the rights against that mortgage loan seller described under "--Cures
and Repurchases" below.
Within a specified period following the later of--
- the date on which the offered certificates are initially issued, and
- the date on which all recording information necessary to complete the
subject document is received by the trustee,
the trustee or other specified party, which may be the related mortgage loan
seller, must submit for recording in the real property records of the applicable
jurisdiction each of the assignments of recorded loan documents in its favor
described above. Because most of the mortgage loans that we intend to include in
the trust are newly originated, many of those assignments cannot be completed
and recorded until the related mortgage and/or assignment of leases and rents,
reflecting the necessary recording information, is returned from the applicable
recording office.
REPRESENTATIONS AND WARRANTIES
As of the date of initial issuance of the offered certificates, each
mortgage loan seller will make, with respect to each mortgage loan that it is
selling to us for inclusion in the trust, representations and warranties
generally to the effect listed below, together with any other representations
and warranties as may be required by the rating agencies.
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The representations and warranties to be made by each mortgage loan seller
with respect to each of the mortgage loans that it is selling to us for
inclusion in the trust, will include:
- The related borrower is an individual who is a citizen of, or an entity
organized under the laws of, a state of the United States of America.
- All payments required to be made with respect to the mortgage loan under
the terms of the related mortgage note or the related mortgage
instrument, inclusive of any applicable grace or cure period, up to the
date of initial issuance of the series 2000-C3 certificates, have been
made. Within the 12 months preceding the date of initial issuance of the
series 2000-C3 certificates, there has not been any delinquency in excess
of 30 days with respect to the mortgage loan.
- The mortgage loan contains no equity participation by the mortgage loan
seller and is a whole loan and not a participation interest. Neither the
related mortgage note nor the related mortgage instrument provides for
negative amortization, unless the mortgage loan is an ARD Loan, or any
contingent or additional interest in the form of participation in the
cash flow of the related mortgaged real property.
- As of the date of its origination, the mortgage loan either complied in
all material respects with, or was exempt from, applicable federal or
state laws, regulations and other requirements pertaining to usury. To
the best of the mortgage loan seller's knowledge, as of the date of
origination of the mortgage loan, the related originator complied in all
material respects with the requirements of any and all other federal,
state or local laws applicable to the origination, servicing and
collection of the mortgage loan. No governmental or regulatory approval
or consent is required for the sale of the mortgage loan by the related
mortgage loan seller, and the mortgage loan seller has full right, power
and authority to sell the mortgage loan. To the extent necessary to
ensure the enforceability of the mortgage loan and the effective sale,
transfer and assignment of the mortgage loan and the related mortgage
note, the originator and/or the mortgage loan seller each was qualified
and appropriately licensed to transact business in the jurisdiction in
which the related mortgaged real property is located at the time that
entity had possession of the related mortgage note.
- The proceeds of the mortgage loan have been fully disbursed, although
certain reserve accounts controlled by the related seller may have been
established, and there is no requirement for future advances under the
related loan documents.
- All costs, fees and expenses incurred in connection with the origination
and closing of the mortgage loan, including recording costs and fees,
have been paid to the appropriate person or arrangements have been made
for their payment to the appropriate person on a timely basis by the
related borrower.
- Each of the related mortgage note, the related mortgage instrument and
any other related loan document is the legal, valid and binding
obligation of the related borrower, the related guarantor or other party
executing that document, subject to
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any non-recourse or partial recourse provisions contained in it, and is
enforceable in accordance with its terms. There is no valid offset, defense,
counterclaim or right of rescission with respect to that mortgage note, mortgage
instrument or other loan document, nor will the operation of any of the
terms of that mortgage note or mortgage instrument, or the exercise of
any right under that mortgage note or mortgage instrument, render either
that mortgage note or mortgage instrument unenforceable or subject to any
valid offset, defense, counterclaim or right of rescission, including the
defense of usury, and the mortgage loan seller has no knowledge that any
such offset, defense, counterclaim, or right of rescission has been
asserted or is available with respect to that document.
- The related mortgage instrument is a legal, valid and enforceable first
lien on the related mortgaged real property, including all buildings and
improvements on that property and all installations and mechanical,
electrical, plumbing, heating and air conditioning systems located in or
annexed to those buildings, and all additions, alterations and
replacements made at any time prior to the closing date of the mortgage
loan with respect to the foregoing, but excluding any related personal
property, which mortgaged real property is free and clear of all liens
and encumbrances having priority over or equal to the first lien of the
related mortgage instrument, except for Permitted Encumbrances.
- To the best of the mortgage loan seller's knowledge, no proceedings for
the total or partial condemnation of the related mortgaged real property
(a) have occurred since the date as of which the appraisal relied upon in
the origination of the mortgage loan was prepared, or (b) are pending or
threatened other than, in each such case, proceedings as to partial
condemnation which do not materially and adversely affect the value of
the related mortgaged real property as security for the mortgage loan. To
the best of the mortgage loan seller's knowledge, the related mortgaged
real property is free of material damage. The related mortgage instrument
requires that any related condemnation award and/or insurance proceeds be
applied either to the restoration of the related mortgaged real property
or to the payment of the outstanding principal balance of or accrued
interest on the mortgage loan.
- The mortgage loan seller has good title to and is the sole owner and
beneficial holder of the mortgage loan. The mortgage loan seller has full
power, authority and legal right to sell and assign the mortgage loan, is
the sole mortgagee or beneficiary of record under the related mortgage
instrument and is transferring the mortgage loan to us free and clear of
any and all liens, encumbrances, participation interests, pledges,
charges, assignments, security interests and other interests on, in or to
the mortgage loan.
- If the related mortgage instrument is a deed of trust or trust deed, then
a trustee, duly qualified under applicable law to serve as such, has
either been properly designated and currently so serves or may be
substituted in accordance with
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applicable law. Except in connection with (a) a trustee's sale after
default by the related borrower or (b) the release of the related
mortgaged real property following the payment of the mortgage loan in
full, no fees or expenses are payable by the lender to that trustee.
- The mortgage loan was originated by the mortgage loan seller, an
affiliate of the mortgage loan seller or an originator approved by the
mortgage loan seller, or was purchased by the related mortgage loan
seller, and the mortgage loan substantially complied with all of the
terms, conditions and requirements of the mortgage loan seller's
underwriting standards in effect at the time of its origination or
purchase of the mortgage loan, subject to such exceptions as the mortgage
loan seller approved.
Each representation and warranty of each mortgage loan seller that relates
to the enforceability of any instrument, agreement or other document or as to
offsets, defenses, counterclaims or rights of rescission related to that
enforceability, is qualified to the extent that:
- enforcement may be limited by (a) bankruptcy, insolvency, reorganization
or other similar laws affecting the enforcement of creditors' rights
generally, (b) general principles of equity, regardless of whether that
enforcement is considered in a proceeding in equity or at law, and (c)
any applicable anti-deficiency law or statute; and
- that instrument, agreement or other document may contain certain
provisions which may be unenforceable in accordance with their terms, in
whole or in part, but the unenforceability of those provisions will not,
subject to the qualification in the prior bullet, (a) cause the related
mortgage note or the related mortgage instrument to be void in their
entirety, (b) invalidate the related borrower's obligation to pay
interest at the stated interest rate of the related mortgage note on, and
repay the principal of, the mortgage loan in accordance with the payment
terms of the related mortgage note, the related mortgage instrument and
other written agreements delivered to the mortgage loan seller in
connection with the mortgage loan, (c) invalidate the obligation of any
related guarantor to pay guaranteed obligations with respect to interest
at the stated interest rate of the related mortgage note on, and the
principal of, the mortgage loan in accordance with the payment terms of
that guarantor's written guaranty, (d) impair the mortgagee's right to
accelerate and demand payment of interest at the stated interest rate of
the related mortgage note on, and principal of, the mortgage loan upon
the occurrence of a legally enforceable default, or (e) impair the
mortgagee's right to realize against the related mortgaged real property
by judicial or, if applicable, non-judicial foreclosure.
If--
- there exists a breach of any of the above-described representations and
warranties made by any mortgage loan seller, and
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- that breach materially and adversely affects the interests of the series
2000-C3 certificateholders in the subject mortgage loan,
then that breach will be a material breach as to which the series 2000-C3
certificateholders, or the trustee on their behalf, will have the rights against
that mortgage loan seller described under "--Cures and Repurchases" below.
CURES AND REPURCHASES
If there exists a material breach of any of the representations and
warranties made by any mortgage loan seller with respect to any of the mortgage
loans that it is selling to us for inclusion in the trust, as discussed under
"--Representations and Warranties" above, or a material document defect with
respect to any of those mortgage loans, as discussed under "--Assignment of the
Underlying Mortgage Loans" above, then that mortgage loan seller will be
required either:
- to remedy the material breach or the material document defect in all
material respects; or
- to repurchase the affected mortgage loan at a price generally equal to
the sum of--
1. the Stated Principal Balance of that mortgage loan at the time of
purchase, plus
2. all unpaid and unadvanced interest, other than Post-ARD Additional
Interest and Default Interest, due with respect to that mortgage
loan up to, but not including the due date in the collection period
of purchase, plus
3. all unreimbursed advances relating to that mortgage loan, together
with any unpaid interest on those advances owing to the party or
parties that made them, plus
4. any costs and expenses incurred by the trustee, the master servicer
or the special servicer in connection with the repurchase.
The time period within which a mortgage loan seller must complete that
remedy or repurchase will generally be limited to 90 days following the earlier
of its discovery or receipt of notice of the subject material breach or material
document defect, as the case may be. However, if the responsible mortgage loan
seller is diligently attempting to correct the problem, the responsible mortgage
loan seller will be entitled to an additional 90 days to complete that remedy or
repurchase.
The cure/repurchase obligations of each mortgage loan seller described
above will constitute the sole remedy available to the series 2000-C3
certificateholders or the trustee on their behalf in connection with a material
breach of any of the representations or warranties by the related mortgage loan
seller, or a material document defect, with respect to any mortgage loan in the
trust. No other person will be obligated to repurchase any affected mortgage
loan in connection with a material breach of any of the representations and
warranties made by the related mortgage loan seller or in connection with a
material document defect, if the related mortgage loan seller defaults on its
obligation to do so.
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CHANGES IN MORTGAGE POOL CHARACTERISTICS
The description in this prospectus supplement of the mortgage pool is based
upon the mortgage pool as it is expected to be constituted at the time the
offered certificates are issued, with adjustments for the monthly debt service
payments due on the mortgage loans on or before the cut-off date. Prior to the
issuance of the offered certificates, one or more mortgage loans may be removed
from the mortgage pool if we consider the removal necessary or appropriate. A
limited number of other mortgage loans may be included in the mortgage pool
prior to the issuance of the offered certificates, unless including those
mortgage loans would materially alter the characteristics of the mortgage pool
as described in this prospectus supplement. We believe that the information in
this prospectus supplement will be generally representative of the
characteristics of the mortgage pool as it will be constituted at the time the
offered certificates are issued. However, the range of mortgage rates and
maturities, as well as the other characteristics of the pooled mortgage loans
described in this prospectus supplement, may vary, and the actual initial
mortgage pool balance may be as much as 5% larger or smaller than the initial
mortgage pool balance specified in this prospectus supplement.
A current report on Form 8-K will be available to purchasers of the offered
certificates on or shortly after the date of initial issuance of the offered
certificates. That current report on Form 8-K will be filed, together with the
pooling and servicing agreement, with the SEC within 15 days after the initial
issuance of the offered certificates. If mortgage loans are removed from or
added to the mortgage pool, that removal or addition will be noted in that
current report on Form 8-K.
SERVICING OF THE UNDERLYING MORTGAGE LOANS
GENERAL
The pooling and servicing agreement will govern the servicing of the
mortgage loans in the trust. The following summaries describe some of the
provisions of the pooling and servicing agreement relating to the servicing and
administration of the pooled mortgage loans and any REO Properties owned by the
trust. You should also refer to the accompanying prospectus, in particular the
section captioned "Description of the Governing Documents" for additional
important information regarding provisions of the pooling and servicing
agreement that relate to the rights and obligations of the master servicer and
the special servicer. See "Description of the Governing Documents--Collection
and Other Servicing Procedures with Respect to Mortgage Loans" in the
accompanying prospectus.
The master servicer and the special servicer must each service and
administer the pooled mortgage loans and any REO Properties owned by the trust
for which it is responsible, directly or through sub-servicers, in accordance
with--
- any and all applicable laws,
- the express terms of the pooling and servicing agreement,
- the express terms of the respective pooled mortgage loans, and
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- to the extent consistent with the foregoing, the Servicing Standard.
In general, the master servicer will be responsible for the servicing and
administration of--
- all mortgage loans in the trust as to which no Servicing Transfer Event
has occurred, and
- all worked-out mortgage loans in the trust as to which no new Servicing
Transfer Event has occurred.
The special servicer, on the other hand, will generally be responsible for
the servicing and administration of each mortgage loan in the trust as to which
a Servicing Transfer Event has occurred and which has not yet become a
worked-out mortgage loan with respect to that Servicing Transfer Event. The
special servicer will also be responsible for the administration of each REO
Property in the trust.
Despite the foregoing, the pooling and servicing agreement will require the
master servicer to continue to collect information and, subject to the master
servicer's timely receipt of information from the special servicer, prepare all
reports to the certificate administrator required to be collected or prepared
with respect to any specially serviced assets. The master servicer may also
render other incidental services with respect to any specially serviced assets.
In addition, the special servicer will be responsible for modifications, waivers
and amendments of all loan terms of all the pooled mortgage loans. Neither the
master servicer nor the special servicer will have responsibility for the
performance by the other of its respective obligations and duties under the
pooling and servicing agreement, unless the same party acts in both capacities.
The master servicer will transfer servicing of a pooled mortgage loan to
the special servicer, if it has not already done so, upon the occurrence of a
Servicing Transfer Event with respect to that mortgage loan. The special
servicer will return the servicing of that mortgage loan to the master servicer,
and that mortgage loan will be considered to have been worked-out, if and when
all Servicing Transfer Events with respect to that mortgage loan cease to exist.
THE INITIAL MASTER SERVICER AND THE INITIAL SPECIAL SERVICER
The Initial Master Servicer. Midland Loan Services, Inc. will be the
initial master servicer with respect to the mortgage pool. Midland, a
wholly-owned subsidiary of PNC Bank, N.A., was incorporated under the laws of
the State of Delaware in 1998. Midland is a real estate financial services
company that provides loan servicing and asset management for large pools of
commercial and multifamily real estate assets.
Midland's principal offices are located at 210 West 10th Street, 6th Floor,
Kansas City, Missouri 64105.
As of October 31, 2000, Midland was servicing approximately 14,072
commercial and multifamily loans with a principal balance of approximately $50.2
billion. The collateral for these loans is located in all 50 states, the
District of Columbia, Puerto Rico and Canada. With respect to those loans,
approximately 10,195 of the loans, with a total
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principal balance of approximately $41.4 billion, pertain to commercial and
multifamily mortgage-backed securities. Property type concentrations within the
portfolio include multifamily, office, retail, hospitality and other types of
income producing properties. Midland also provides commercial loan servicing for
newly-originated loans and loans acquired in the secondary market for:
- financial institutions,
- private investors, and
- issuers of commercial and multifamily mortgage-backed securities.
Midland is approved as a master servicer, special servicer and primary
servicer for investment-grade rated commercial and multifamily mortgage-backed
securities by Moody's, Fitch, Inc. and S&P. Midland has received the highest
rankings as a master, primary and special servicer from both S&P and Fitch. S&P
ranks Midland as "Strong" and Fitch ranks Midland as "1" for each category.
Midland currently maintains an Internet-based investor reporting system,
CMBS Investor Insight(TM) that contains updated performance information at the
portfolio, loan and property levels on the various commercial mortgage-backed
securities transactions that it services. Series 2000-C3 certificateholders,
prospective transferees and other appropriate parties may obtain access to CMBS
Investor Insight(TM) through Midland's website, "www.midlandls.com." Midland may
require registration and the execution of an access agreement in connection with
providing access to CMBS Investor Insight(TM). Specific questions about
portfolio, loan and property performance may be sent to the master servicer via
e-mail at [email protected].
The information set forth in this prospectus supplement concerning Midland
has been provided by it. Neither we nor any of the underwriters makes any
representation or warranty as to the accuracy or completeness of this
information.
The Initial Special Servicer. Lennar Partners, Inc., a Florida
corporation and a subsidiary of LNR Property Corporation, will act as special
servicer with respect to the mortgage pool. The principal executive offices of
Lennar are located at 760 NW 107th Avenue, Miami, Florida, 33172, and its
telephone number is (305) 485-2000.
LNR Property Corporation, its subsidiaries and affiliates, are involved in
the real estate investment and management business and engage principally in--
- acquiring, developing, managing and repositioning commercial and
multi-family residential real estate properties,
- acquiring, often in partnership with financial institutions or real
estate funds, and managing portfolios of mortgage loans and other real
estate related assets,
- investing in unrated and non-investment grade rated commercial
mortgage-backed securities in respect of which Lennar has the right to be
special servicer, and
- making high yielding real estate related loans and equity investments.
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Lennar has regional offices located across the country in Florida, Georgia,
Oregon and California. As of September 1, 2000, Lennar and its affiliates were
managing a portfolio including over 11,000 assets in most states with an
original face value of over $52 billion, most of which are commercial real
estate assets. Included in this managed portfolio are $47 billion of commercial
real estate assets representing 63 securitization transactions, for which Lennar
is the master servicer or special servicer. Lennar and its affiliates own, and
are in the business of acquiring assets similar in type to the pooled mortgage
loans.
The information set forth in this prospectus supplement concerning Lennar
and LNR Property Corporation has been provided by them. Neither we nor any of
the underwriters makes any representation or warranty as to the accuracy or
completeness of the information.
SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES
The Master Servicing Fee. The principal compensation to be paid to the
master servicer with respect to its master servicing activities will be the
master servicing fee.
The master servicing fee:
- will be earned with respect to each and every mortgage loan, including--
1. each specially serviced mortgage loan, if any,
2. each mortgage loan, if any, as to which the corresponding mortgaged
real property has become an REO Property, and
3. each mortgage loan that has been defeased, and
- in the case of each mortgage loan, will--
1. accrue at a master servicing fee rate equal to the related
Administrative Fee Rate, as shown in Annex A, less .0024%,
2. be computed on the basis of the same principal amount and for the
same number of days respecting which any related interest payment
due or deemed due, as the case may be, on that mortgage loan is
computed under the terms of the related loan documents and
applicable law,
3. accrue on the same interest accrual basis, which is either
actual/360 or 30/360, as that mortgage loan, and
4. be payable monthly from amounts received in respect of interest on
that mortgage loan.
If Midland resigns or is terminated as the master servicer and the
successor master servicer agrees to perform the services of the master servicer
for an amount less than the master servicing fee, then the successor master
servicer will pay to Midland or its designee, and the series 2000-C3
certificateholders will not receive any portion of, the excess master servicing
fee.
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Additional Master Servicing Compensation. As additional master servicing
compensation, the master servicer will be entitled to receive any Prepayment
Interest Excesses collected with respect to the pooled mortgage loans.
In addition, the following items collected on the pooled mortgage loans
will be allocated between the master servicer and the special servicer as
additional compensation in accordance with the pooling and servicing agreement:
- any Default Interest not otherwise applied to pay or offset, as the case
may be, on a poolwide basis, any interest on advances or, except for
special servicing fees, any other Additional Trust Fund Expenses then
outstanding or paid, other than from Default Interest, during the
preceding 12-month period; and
- any late payment charges, modification fees, assumption fees, assumption
application fees, consent/waiver fees and other comparable transaction
fees and charges.
The master servicer will be authorized to invest or direct the investment
of funds held in its collection account, or in any and all escrow and reserve
accounts maintained by it, in Permitted Investments. See "--Collection Account"
below. The master servicer will be entitled to retain any interest or other
income earned on those funds that is not otherwise payable to the respective
borrowers and will be required to cover any losses of principal from its own
funds, to the extent those losses are incurred with respect to investments made
for the master servicer's benefit. The master servicer will not be obligated,
however, to cover any losses resulting from the bankruptcy or insolvency of any
depository institution or trust company holding any of those accounts.
Prepayment Interest Shortfalls. The pooling and servicing agreement
provides that, if any Prepayment Interest Shortfalls are incurred with respect
to the mortgage pool during any collection period, the master servicer must make
a non-reimbursable payment with respect to the related payment date in an amount
equal to the lesser of:
- the total of all Prepayment Interest Shortfalls incurred with respect to
the mortgage pool during that collection period; and
- the sum of--
1. the total of all Prepayment Interest Excesses, if any, collected
with respect to the mortgage pool during that collection period, and
2. with respect to each and every mortgage loan for which the master
servicer receives master servicing fees during that collection
period, the portion of those fees calculated at an annual rate of
0.02% per annum.
No other master servicing compensation will be available to cover
Prepayment Interest Shortfalls.
Any payments made by the master servicer with respect to any payment date
to cover Prepayment Interest Shortfalls will be included in the Available P&I
Funds for that payment date. If the amount of the payment made by the master
servicer with respect to any payment date to cover Prepayment Interest
Shortfalls is less than the total
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of all Prepayment Interest Shortfalls incurred with respect to the mortgage pool
during the related collection period, then the resulting Net Aggregate
Prepayment Interest Shortfall will be allocated among the respective
interest-bearing classes of the series 2000-C3 certificates, in reduction of the
interest payable on those certificates, as and to the extent described under
"Description of the Offered Certificates--Payments--Payments of Interest" in
this prospectus supplement.
Principal Special Servicing Compensation. The principal compensation to
be paid to the special servicer with respect to its special servicing activities
will be--
- the special servicing fee,
- the workout fee, and
- the liquidation fee.
The Special Servicing Fee. The special servicing fee:
- will be earned with respect to--
1. each specially serviced mortgage loan, if any, and
2. each mortgage loan, if any, as to which the corresponding mortgaged
real property has become an REO Property;
- in the case of each mortgage loan described in the foregoing bullet
point, will--
1. accrue at a special servicing fee rate of 0.25% per annum,
2. be computed on the basis of the same principal amount and for the
same number of days respecting which any related interest payment
due or deemed due, as the case may be, on that mortgage loan is
computed under the terms of the related loan documents and
applicable law, and
3. accrue on the same interest accrual basis, which is either
actual/360 or 30/360, as that mortgage loan; and
- will be payable monthly from general collections on all the mortgage
loans and any REO Properties in the trust, that are on deposit in the
master servicer's collection account from time to time.
The Workout Fee. The special servicer will, in general, be entitled to
receive a workout fee with respect to each worked-out mortgage loan in the
trust. The workout fee will be payable out of, and will be calculated by
application of a workout fee rate of 1.0% to, each payment of interest, other
than Default Interest and Post-ARD Additional Interest, and principal received
on the mortgage loan for so long as it remains a worked-out mortgage loan. The
workout fee with respect to any worked-out mortgage loan will cease to be
payable if a new Servicing Transfer Event occurs with respect to that loan or if
the related mortgaged real property becomes an REO Property. However, a new
workout fee would become payable if the mortgage loan again became a worked-out
mortgage loan with respect to that new Servicing Transfer Event. If the special
servicer is terminated other than for cause or resigns, it will retain the right
to receive any and all workout fees payable with respect to mortgage loans that
became worked-out mortgage
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loans during the period that it acted as special servicer and as to which no new
Servicing Transfer Event had occurred as of the time of its termination or
resignation. The successor special servicer will not be entitled to any portion
of those workout fees. Although workout fees are intended to provide the special
servicer with an incentive to better perform its duties, the payment of any
workout fee will reduce amounts payable to the series 2000-C3
certificateholders.
The Liquidation Fee. The special servicer will be entitled to receive a
liquidation fee with respect to each specially serviced mortgage loan in the
trust for which it obtains a full, partial or discounted payoff from the related
borrower. The special servicer will also be entitled to receive a liquidation
fee with respect to any specially serviced mortgage loan or REO Property in the
trust as to which it receives any liquidation proceeds, condemnation proceeds or
insurance proceeds, except as described in the next paragraph. As to each
specially serviced mortgage loan and REO Property in the trust, the liquidation
fee normally will be payable from, and will be calculated by application of a
liquidation fee rate of 1.0% to, the related payment or proceeds, exclusive of
any portion of that payment or proceeds that represents a recovery of Default
Interest, Post-ARD Additional Interest, a prepayment premium or a yield
maintenance charge.
Despite anything to the contrary described in the prior paragraph, no
liquidation fee will be payable based on, or out of, proceeds received in
connection with:
- the repurchase of any mortgage loan in the trust by or on behalf of a
mortgage loan seller for a breach of representation or warranty or for
defective or deficient mortgage loan documentation, as described under
"Description of the Mortgage Pool--Cures and Repurchases" in this
prospectus supplement;
- the purchase of any defaulted mortgage loan or REO Property in the trust
by the master servicer, the special servicer or any holder or holders of
certificates of the series 2000-C3 controlling class, as described under
"--Realization Upon Defaulted Mortgage Loans" below; or
- the purchase of all of the mortgage loans and REO Properties in the trust
by the master servicer, the special servicer or any holder or holders of
certificates of the series 2000-C3 controlling class in connection with
the termination of the trust, or the exchange of 100% of the series
2000-C3 certificates for those mortgage loans and REO Properties, all as
described under "Description of the Offered Certificates--Termination" in
this prospectus supplement.
Although liquidation fees are intended to provide the special servicer with
an incentive to better perform its duties, the payment of any liquidation fee
will reduce amounts payable to the series 2000-C3 certificateholders.
Additional Special Servicing Compensation. The following items collected
on the pooled mortgage loans will be allocated between the master servicer and
the special servicer as additional compensation in accordance with the pooling
and servicing agreement:
- any Default Interest not otherwise applied to pay or offset, as the case
may be, on a poolwide basis, any interest on advances or, except for
special servicing fees,
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any other Additional Trust Fund Expenses then outstanding or paid, other
than from Default Interest, during the preceding 12-month period; and
- any late payment charges, modification fees, assumption fees, assumption
application fees, consent/waiver fees and other comparable transaction
fees and charges.
The special servicer will be authorized to invest or direct the investment
of funds held in its REO account in Permitted Investments. See "--REO
Properties" below. The special servicer will be entitled to retain any interest
or other income earned on those funds, but will be required to cover any losses
of principal of those investments from its own funds without any right to
reimbursement. The special servicer will not be obligated, however, to cover any
losses resulting from the bankruptcy or insolvency of any depository institution
or trust company holding the special servicer's REO account.
Payment of Expenses; Servicing Advances. Each of the master servicer and
the special servicer will be required to pay its overhead and any general and
administrative expenses incurred by it in connection with its servicing
activities under the pooling and servicing agreement. The master servicer and
the special servicer will not be entitled to reimbursement for these expenses
except as expressly provided in the pooling and servicing agreement.
Any and all customary, reasonable and necessary out of pocket costs and
expenses incurred by the master servicer or the special servicer in connection
with the servicing of a pooled mortgage loan after a default, delinquency or
other unanticipated event, or in connection with the administration of any REO
Property in the trust, will be servicing advances. Servicing advances will be
reimbursable from future payments and other collections, including insurance
proceeds, condemnation proceeds and liquidation proceeds, received in connection
with the related mortgage loan or REO Property. In addition, the master servicer
will reimburse the special servicer on a monthly basis for any servicing
advances made by it. Upon reimbursing the special servicer for any servicing
advance, the master servicer will be deemed to have made the advance.
The special servicer may request the master servicer to make servicing
advances with respect to a specially serviced mortgage loan or REO Property, in
lieu of the special servicer's making that advance itself. The special servicer
must make the request in writing, in a timely manner that does not adversely
affect the interests of any series 2000-C3 certificateholder. The master
servicer must make the requested servicing advance within five business days
following the master servicer's receipt of the request, accompanied by an
adequate description of the subject advance and back-up information. If the
request is timely and properly made, the special servicer will be relieved of
any obligations with respect to a servicing advance that it requests the master
servicer to make, regardless of whether or not the master servicer actually
makes that advance.
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If the master servicer or the special servicer is required under the
pooling and servicing agreement to make a servicing advance, but neither does so
within ten days after the servicing advance is required to be made, then the
trustee will be required:
- if it has actual knowledge of the failure, to give the defaulting party
notice of its failure; and
- if the failure continues for three more business days, to make the
servicing advance.
Despite the foregoing discussion or anything else to the contrary in this
prospectus supplement, none of the master servicer, the special servicer or the
trustee will be obligated to make servicing advances that, in its judgment,
would not be ultimately recoverable from expected collections on the related
mortgage loan or REO Property. If the master servicer, the special servicer or
the trustee makes any servicing advance that it subsequently determines, in its
judgment, is not recoverable from expected collections on the related mortgage
loan or REO Property, it may obtain reimbursement for that advance, together
with interest on that advance, out of general collections on the mortgage loans
and any REO Properties on deposit in the master servicer's collection account
from time to time.
The pooling and servicing agreement will permit the master servicer to pay,
and will permit the special servicer to direct the master servicer to pay, some
servicing expenses directly out of the master servicer's collection account and
at times without regard to the relationship between the expense and the funds
from which it is being paid. The most significant of those servicing expenses
relate to the remediation of any adverse environmental circumstance or condition
at any of the mortgaged real properties. In addition, the pooling and servicing
agreement will require the master servicer, at the direction of the special
servicer if a specially serviced asset is involved, to pay directly out of the
master servicer's collection account any servicing expense that, if advanced by
the master servicer or the special servicer, would not be recoverable from
expected collections on the related mortgage loan or REO Property. This is only
to be done, however, when the master servicer, or the special servicer if a
specially serviced asset is involved, has determined in accordance with the
Servicing Standard that making the payment is in the best interests of the
series 2000-C3 certificateholders, as a collective whole.
The master servicer, the special servicer and the trustee will each be
entitled to receive interest on servicing advances made by them. The interest
will accrue on the amount of each servicing advance for so long as the servicing
advance is outstanding, at a rate per annum equal to the prime rate as published
in the "Money Rates" section of The Wall Street Journal, as that prime rate may
change from time to time. Interest accrued with respect to any servicing advance
will be payable--
- first, out of any Default Interest collected on any pooled mortgage loan
subsequent to the accrual of that advance interest up to and including
the date of reimbursement of that servicing advance, and
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- then, after the advance has been reimbursed, but only if and to the
extent that the Default Interest referred to in clause first above that
has been collected through the date of that reimbursement has been
insufficient to cover the advance interest, out of any amounts then on
deposit in the master servicer's collection account.
If any payment of interest on advances is paid out of general collections on the
mortgage pool as contemplated by the second bullet of the prior sentence, then
any Default Interest collected during the twelve-month period following that
payment will be applied to reimburse the trust for that payment prior to being
applied as additional compensation to the master servicer or the special
servicer.
DESIGNATED SUB-SERVICERS
Some of the mortgage loans that we intend to include in the trust, are
currently being serviced by third-party servicers that are entitled to and will
become sub-servicers of these loans on behalf of the master servicer. Neither
the trustee nor any other successor master servicer may terminate the
sub-servicing agreement for any of those sub-servicers without cause.
THE SERIES 2000-C3 CONTROLLING CLASS REPRESENTATIVE
Series 2000-C3 Controlling Class. As of any date of determination, the
controlling class of series 2000-C3 certificateholders will be the holders of
the most subordinate class of series 2000-C3 certificates then outstanding,
other than the class X, Y and R certificates, that has a total principal balance
that is not less than 25% of that class's original total principal balance.
However, if no class of series 2000-C3 certificates, exclusive of the class X, Y
and R certificates, has a total principal balance that satisfies this
requirement, then the controlling class of series 2000-C3 certificateholders
will be the holders of the most subordinate class of series 2000-C3 certificates
then outstanding, other than the class X, Y and R certificates, that has a total
principal balance greater than zero. For the purpose of determining the series
2000-C3 controlling class, the class A-1 and A-2 certificates will represent a
single class.
Election of the series 2000-C3 Controlling Class Representative. The
series 2000-C3 certificateholders entitled to a majority of the voting rights
allocated to the series 2000-C3 controlling class, will be entitled to--
- select a representative having the rights and powers described under
"--The Series 2000-C3 Controlling Class Representative--Rights and Powers
of the Series 2000-C3 Controlling Class Representative" below, or
- replace an existing series 2000-C3 controlling class representative.
The certificate administrator will be required to notify promptly all the
certificateholders of the series 2000-C3 controlling class that they may select
a series 2000-C3 controlling class representative upon:
- the receipt by the certificate administrator of written requests for the
selection of a series 2000-C3 controlling class representative from
series 2000-C3 certificate-
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holders entitled to a majority of the voting rights allocated to the
series 2000-C3 controlling class;
- the resignation or removal of the person acting as series 2000-C3
controlling class representative; or
- a determination by the certificate administrator that the series 2000-C3
controlling class has changed.
The notice will explain the process for selecting a series 2000-C3
controlling class representative. The appointment of any person as a series
2000-C3 controlling class representative will not be effective until:
- the certificate administrator has received notice, in any form acceptable
to the certificate administrator, that the appointment of that person as
series 2000-C3 controlling class representative is acceptable to series
2000-C3 certificateholders entitled to a majority of the voting rights
allocated to the series 2000-C3 controlling class; and
- that person provides the certificate administrator with--
1. written confirmation of its acceptance of its appointment,
2. written confirmation that it will keep confidential any information
that it receives as series 2000-C3 controlling class representative,
3. an address and telecopy number for the delivery of notices and other
correspondence, and
4. a list of officers or employees of the person with whom the parties
to the pooling and servicing agreement may deal, including their
names, titles, work addresses and telecopy numbers.
Resignation and Removal of the series 2000-C3 Controlling Class
Representative. The series 2000-C3 controlling class representative may at any
time resign by giving written notice to the certificate administrator and each
certificateholder of the series 2000-C3 controlling class. The series 2000-C3
certificateholders entitled to a majority of the voting rights allocated to the
series 2000-C3 controlling class, will be entitled to remove any existing series
2000-C3 controlling class representative by giving written notice to the
certificate administrator and to the existing series 2000-C3 controlling class
representative.
Rights and Powers of the Series 2000-C3 Controlling Class
Representative. The series 2000-C3 controlling class representative will be
entitled to advise the special servicer with respect to the following actions of
the special servicer. In addition, the special servicer will not be permitted to
take any of the following actions as to which the series 2000-C3 controlling
class representative has objected in writing within ten business days of having
been notified in writing of the particular action and having been provided with
all reasonably requested information with respect to the particular action:
- any foreclosure upon or comparable conversion, which may include
acquisitions of an REO Property, of the ownership of any mortgaged real
properties securing
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those specially serviced mortgage loans in the trust as come into and
continue in default;
- any modification, amendment or waiver of a monetary term, including the
timing of payments, or any material non-monetary term of a specially
serviced mortgage loan in the trust;
- any proposed sale of a defaulted mortgage loan or REO Property out of the
trust for less than par, other than in connection with the termination of
the trust as described under "Description of the Offered
Certificates--Termination" in this prospectus supplement;
- any acceptance of a discounted payoff with respect to a specially
serviced mortgage loan in the trust;
- any determination to bring an REO Property held by the trust into
compliance with applicable environmental laws or to otherwise address
hazardous materials located at the REO Property;
- any release of collateral for a specially serviced mortgage loan in the
trust, other than in accordance with the terms of, or upon satisfaction
of, that mortgage loan;
- any acceptance of substitute or additional collateral for a specially
serviced mortgage loan in the trust, other than in accordance with the
terms of that mortgage loan;
- any waiver of a due-on-sale or due-on-encumbrance clause with respect to
a pooled mortgage loan; and
- any acceptance of an assumption agreement releasing a borrower from
liability under a pooled mortgage loan.
In addition, the series 2000-C3 controlling class representative may direct
the special servicer to take, or to refrain from taking, any actions that the
series 2000-C3 controlling class representative may consider advisable or as to
which provision is otherwise made in the pooling and servicing agreement.
Notwithstanding the foregoing, no advice, direction or objection given or
made by the series 2000-C3 controlling class representative, as contemplated by
either of the two preceding paragraphs, may:
- require or cause the special servicer to violate applicable law, the
terms of any pooled mortgage loan or any other provision of the pooling
and servicing agreement described in this prospectus supplement or the
accompanying prospectus, including the special servicer's obligation to
act in accordance with the Servicing Standard;
- result in an adverse tax consequence for the trust;
- expose the trust, us, the underwriters, the master servicer, the special
servicer, the trustee or any of our or their respective affiliates,
members, managers, directors, officers, employees or agents, to any
material claim, suit or liability; or
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- materially expand the scope of the special servicer's responsibilities
under the pooling and servicing agreement.
The special servicer is to disregard any advice, direction or objection on the
part of the series 2000-C3 controlling class representative that would have any
of the effects described in the immediately preceding four bullet points.
Furthermore, the special servicer will not be obligated to seek approval
from the Series 2000-C3 controlling class representative for any actions to be
taken by the special servicer with respect to any particular specially serviced
mortgage loan if--
- the special servicer has, as described in the first paragraph under this
"--Rights and Powers of the Series 2000-C3 Controlling Class
Representative" subsection, notified the series 2000-C3 controlling class
representative in writing of various actions that the special servicer
proposes to take with respect to the work-out or liquidation of that
mortgage loan, and
- for 60 days following the first of those notices, the series 2000-C3
controlling class representative has objected to all of those proposed
actions and has failed to suggest or agree to any alternative actions
that the special servicer considers to be consistent with the Servicing
Standard.
When reviewing the rest of this "Servicing of the Underlying Mortgage
Loans" section, it is important that you consider the effects that the rights
and powers of the series 2000-C3 controlling class representative discussed
above could have on the actions of the special servicer.
Liability to Borrowers. In general, any and all expenses of the series
2000-C3 controlling class representative are to be borne by the holders of the
series 2000-C3 controlling class, in proportion to their respective percentage
interests in that class, and not by the trust. However, if a claim is made
against the series 2000-C3 controlling class representative by a borrower with
respect to the pooling and servicing agreement or any particular pooled mortgage
loan, the series 2000-C3 controlling class representative is to immediately
notify the trustee, the certificate administrator, the master servicer and the
special servicer. Subject to the discussion under "Description of the Governing
Documents--Matters Regarding the Master Servicer, the Special Servicer, the
Manager and Us" in the accompanying prospectus, the special servicer on behalf
of the trust will assume the defense of the claim against the series 2000-C3
controlling class representative, but only if--
- the special servicer, master servicer or the trust are also named parties
to the same action, and
- in the sole judgment of the special servicer,
1. the series 2000-C3 controlling class representative acted in good
faith, without negligence or willful misfeasance, with regard to the
particular matter at issue, and
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2. there is no potential for the special servicer or the trust to be an
adverse party in the action as regards the series 2000-C3
controlling class representative.
Liability to the Trust and Certificateholders. The series 2000-C3
controlling class representative may have special relationships and interests
that conflict with those of the holders of one or more classes of the offered
certificates. In addition, the series 2000-C3 controlling class representative
does not have any duties to the holders of any class of series 2000-C3
certificates other than the series 2000-C3 controlling class. It may act solely
in the interests of the certificateholders of the series 2000-C3 controlling
class and will have no liability to any other series 2000-C3 certificateholders
for having done so. No series 2000-C3 certificateholder may take any action
against the series 2000-C3 controlling class representative for its having acted
solely in the interests of the certificateholders of the series 2000-C3
controlling class.
REPLACEMENT OF THE SPECIAL SERVICER
Series 2000-C3 certificateholders entitled to a majority of the voting
rights allocated to the series 2000-C3 controlling class may terminate an
existing special servicer and appoint a successor. In addition, if the special
servicer is terminated in connection with an event of default, series 2000-C3
certificateholders entitled to a majority of the voting rights allocated to the
series 2000-C3 controlling class, may appoint a successor. See "--Events of
Default" and "--Rights Upon Event of Default" below. In either case, any
appointment of a successor special servicer will be subject to, among other
things, receipt by the trustee of--
1. written confirmation from each of Moody's and S&P that the appointment
will not result in a qualification, downgrade or withdrawal of any of
the ratings then assigned by the rating agency to the series 2000-C3
certificates, and
2. the written agreement of the proposed special servicer to be bound by
the terms and conditions of the pooling and servicing agreement,
together with an opinion of counsel regarding, among other things, the
enforceability of the pooling and servicing agreement against the
proposed special servicer.
Subject to the foregoing, any certificateholder or any affiliate of a
certificateholder may be appointed as special servicer.
If the controlling class of series 2000-C3 certificateholders terminate an
existing special servicer without cause, then the reasonable out-of-pocket costs
and expenses of any related transfer of special servicing duties are to be paid
by the successor special servicer or the series 2000-C3 certificateholders that
voted to remove the terminated special servicer, as the parties may agree.
Furthermore, the terminated special servicer will be entitled to:
- payment out of the master servicer's collection account for all accrued
and unpaid special servicing fees; and
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- reimbursement by the successor special servicer for any outstanding
servicing advances made by the terminated special servicer, together with
interest.
Upon reimbursement, any advance will be treated as if it were made by the
successor special servicer.
BENEFICIAL OWNERS OF THE CONTROLLING CLASS OF SERIES 2000-C3
If the controlling class of series 2000-C3 certificates is held in
book-entry form, then any beneficial owner of those certificates whose identity
and beneficial ownership interest has been proven to the satisfaction of the
certificate administrator, will be entitled--
- to receive all notices described under "--The Series 2000-C3 Controlling
Class Representative" and "--Replacement of the Special Servicer" above,
and
- to exercise directly all rights described under "--The Series 2000-C3
Controlling Class Representative" and "--Replacement of the Special
Servicer" above,
that it otherwise would if it were the registered holder of certificates of the
series 2000-C3 controlling class.
ENFORCEMENT OF DUE-ON-SALE AND DUE-ON-ENCUMBRANCE PROVISIONS
Subject to the discussion under "--The Series 2000-C3 Controlling Class
Representative" above, the special servicer will be required to determine, in a
manner consistent with the Servicing Standard, whether to waive any right the
lender under any pooled mortgage loan may have under either a due-on-sale or
due-on-encumbrance clause to accelerate payment of that mortgage loan. However,
the special servicer may not waive its rights or grant its consent under any
due-on-encumbrance clause or, subject to the related loan documents, if the
subject pooled mortgage loan and any related pooled mortgage loans have a total
cut-off date principal balance of at least $15,000,000, any due-on-sale clause,
unless it has received written confirmation from each of Moody's and S&P that
this action would not result in the qualification, downgrade or withdrawal of
any of the then-current ratings then assigned by the rating agency to the series
2000-C3 certificates.
MODIFICATIONS, WAIVERS, AMENDMENTS AND CONSENTS
The special servicer, but not the master servicer, may, consistent with the
Servicing Standard, agree to:
- modify, waive or amend any term of any mortgage loan;
- extend the maturity of any mortgage loan;
- defer or forgive the payment of interest on and principal of any mortgage
loan;
- defer or forgive the payment of prepayment premiums, yield maintenance
charges and late payment charges on any mortgage loan;
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- permit the release, addition or substitution of collateral securing any
mortgage loan; or
- permit the release, addition or substitution of the borrower or any
guarantor of any mortgage loan.
The ability of the special servicer to agree to any of the foregoing,
however, is subject to the discussion under "--The Series 2000-C3 Controlling
Class Representative" and "--Enforcement of Due-on-Sale and Due-on-Encumbrance
Provisions" above and, further, to each of the following limitations, conditions
and restrictions:
- With limited exceptions, including with respect to Post-ARD Additional
Interest, the special servicer may not agree to modify, waive or amend
any term of, or take any of the other above-referenced actions with
respect to, any mortgage loan in the trust, if doing so would--
1. affect the amount or timing of any related payment of principal,
interest or other amount payable under the mortgage loan, or
2. in the special servicer's judgment, materially impair the security
for the mortgage loan or reduce the likelihood of timely payment of
amounts due on the mortgage loan,
unless a material default on the mortgage loan has occurred or, in the
special servicer's judgment, a default with respect to payment on the
mortgage loan is reasonably foreseeable, and the modification, waiver,
amendment or other action is reasonably likely to produce a greater
recovery to the series 2000-C3 certificateholders, as a collective whole,
on a present value basis, than would liquidation.
- The special servicer may not extend the date on which any balloon payment
is scheduled to be due on any mortgage loan in the trust to a date beyond
the earliest of--
1. two years prior to the rated final payment date for the series
2000-C3 certificates, and
2. if the mortgage loan is secured by a lien solely or primarily on the
related borrower's leasehold interest in the corresponding mortgaged
real property, 20 years or, to the extent consistent with the
Servicing Standard, giving due consideration to the remaining term
of the ground lease, 10 years, prior to the end of the then current
term of the related ground lease, plus any unilateral options to
extend.
- The special servicer may not make or permit any modification, waiver or
amendment of any term of, or take any of the other above-referenced
actions with respect to, any mortgage loan in the trust that would--
1. cause any of REMIC I, REMIC II, REMIC III or the individual loan
REMICs to fail to qualify as a REMIC under the Internal Revenue Code
of 1986,
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2. result in the imposition of any tax on prohibited transactions or
contributions after the startup date of any of REMIC I, REMIC II,
REMIC III or the individual loan REMICs under the Internal Revenue
Code of 1986, or
3. adversely affect the status of any portion of the trust that is
intended to be a grantor trust under the Internal Revenue Code of
1986;
- The special servicer may not permit any borrower to add or substitute any
real estate collateral for any mortgage loan in the trust, unless the
special servicer has first--
1. determined, based upon an environmental assessment prepared by an
independent person who regularly conducts environmental assessments,
at the expense of the borrower, that--
(a) the additional or substitute collateral is in compliance with
applicable environmental laws and regulations, and
(b) there are no circumstances or conditions present with respect
to the 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
or regulations, and
2. received confirmation from each of Moody's and S&P that the addition
or substitution of any real estate collateral will not result in a
qualification, downgrade or withdrawal of any rating then assigned
by the rating agency to a class of series 2000-C3 certificates.
- Subject to limited exceptions, the special servicer may not release any
material collateral securing an outstanding mortgage loan in the trust
other than in accordance with the terms of, or upon satisfaction of, the
mortgage loan.
The foregoing limitations, conditions and restrictions will not apply to
any of the acts referenced in this "--Modifications, Waivers, Amendments and
Consents" section that occurs automatically by its terms, or that results from
the exercise of a unilateral option by the related borrower within the meaning
of Treasury Regulation Section 1.1001-3(c)(2)(iii), in any event, under the
terms of the subject mortgage loan in effect on the date of initial issuance of
the offered certificates. Also, neither the master servicer nor the special
servicer will be required to oppose the confirmation of a plan in any bankruptcy
or similar proceeding involving a borrower if, in its judgment, opposition would
not ultimately prevent the confirmation of the plan or one substantially
similar, despite the discussion above.
Notwithstanding the foregoing, the special servicer may, in its discretion,
waive any or all of the Post-ARD Additional Interest accrued on any ARD Loan
after its anticipated repayment date, if the related borrower is ready and
willing to pay all other amounts due under the mortgage loan in full, including
the entire principal balance. However, the special servicer's determination to
waive the trust's right to receive that Post-ARD Additional Interest must be in
accordance with the Servicing Standard. The
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pooling and servicing agreement will also limit the special servicer's ability
to institute an enforcement action solely for the collection of Post-ARD
Additional Interest.
All material modifications, waivers and amendments entered into with
respect to the pooled mortgage loans are to be in writing. The special servicer
must deliver to the trustee or a custodian on its behalf for deposit in the
related mortgage file, an original counterpart of the agreement relating to each
modification, waiver or amendment agreed to by it, promptly following its
execution.
REQUIRED APPRAISALS
Promptly following the occurrence of any Appraisal Trigger Event with
respect to any of the pooled mortgage loans, the special servicer must obtain,
and deliver to the trustee and the master servicer a copy of, an appraisal of
the related mortgaged real property from an independent appraiser meeting the
qualifications imposed in the pooling and servicing agreement, unless an
appraisal had previously been obtained within the prior 12 months and there has
been no subsequent material change in the circumstances surrounding that
property that in the special servicer's sole judgment materially affects the
property's value.
Notwithstanding the foregoing, if the Stated Principal Balance of the
subject mortgage loan is $2,000,000 or less, the special servicer may perform a
limited appraisal and a summary report or an internal valuation of the mortgaged
real property.
As a result of any appraisal or other valuation, it may be determined that
an Appraisal Reduction Amount exists with respect to the subject mortgage loan.
An Appraisal Reduction Amount is relevant to the determination of the amount of
any advances of delinquent interest required to be made with respect to the
affected mortgage loan. See "Description of the Offered Certificates--Advances
of Delinquent Monthly Debt Service Payments" in this prospectus supplement.
If an Appraisal Trigger Event occurs with respect to any mortgage loan in
the trust, then the special servicer will have an ongoing obligation to obtain
or perform, as the case may be, within 30 days of each anniversary of the
occurrence of that Appraisal Trigger Event, an update of the prior required
appraisal or other valuation. Based upon that update, the special servicer is to
redetermine and report to the trustee, the certificate administrator and the
master servicer the new Appraisal Reduction Amount, if any, with respect to the
mortgage loan. This ongoing obligation will cease if and when--
- the subject mortgage loan has become a worked-out mortgage loan as
contemplated under "--General" above,
- the subject mortgage loan has remained current for at least three
consecutive monthly debt service payments, and
- no other Appraisal Trigger Event has occurred with respect to the subject
mortgage loan during the preceding three months.
The cost of each required appraisal, and any update of that appraisal, will
be advanced by the special servicer or, at its direction, the master servicer
and will be
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reimbursable to the special servicer or the master servicer, as applicable, as a
servicing advance.
At any time that an Appraisal Reduction Amount exists with respect to any
mortgage loan in the trust, the series 2000-C3 controlling class representative
will be entitled, at its own expense, to obtain and deliver to the trustee, the
certificate administrator, the master servicer and the special servicer an
appraisal that satisfies the criteria for a required appraisal. Upon request of
the series 2000-C3 controlling class representative, the special servicer will
be required to recalculate the Appraisal Reduction Amount with respect to the
subject mortgage loan based on that appraisal.
COLLECTION ACCOUNT
General. The master servicer will be required to establish and maintain a
collection account for purposes of holding payments and other collections that
it receives with respect to the pooled mortgage loans. That collection account
must be maintained in a manner and with a depository institution that satisfies
rating agency standards for securitizations similar to the one involving the
offered certificates.
The funds held in the master servicer's collection account may be held as
cash or invested in Permitted Investments. Any interest or other income earned
on funds in the master servicer's collection account will be paid to the master
servicer as additional compensation subject to the limitations set forth in the
pooling and servicing agreement.
Deposits. Under the pooling and servicing agreement, the master servicer
must deposit or cause to be deposited in its collection account within two
business days following receipt, in the case of payments and other collections
on the pooled mortgage loans, or as otherwise required under the pooling and
servicing agreement, the following payments and collections received or made by
or on behalf of the master servicer with respect to the mortgage pool subsequent
to the date of initial issuance of the offered certificates, other than monthly
debt service payments due on or before the cut-off date, which monthly debt
service payments belong to the related mortgage loan seller:
- all payments on account of principal on the mortgage loans, including
principal prepayments;
- all payments on account of interest on the mortgage loans, including
Default Interest and Post-ARD Additional Interest;
- all prepayment premiums and yield maintenance charges collected with
respect to the mortgage loans;
- all proceeds received under any hazard, flood, title or other insurance
policy that provides coverage with respect to a mortgaged real property
or the related mortgage loan, and all proceeds received in connection
with the condemnation or the taking by right of eminent domain of a
mortgaged real property, in each case to the extent not otherwise
required to be applied to the restoration of the real property or
released to the related borrower;
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- all amounts received and retained in connection with the liquidation of
defaulted mortgage loans by foreclosure or as otherwise contemplated
under "--Realization Upon Defaulted Mortgage Loans" below;
- any amounts paid by or on behalf of a mortgage loan seller in connection
with the repurchase of a mortgage loan as described under "Description of
the Mortgage Pool--Cures and Repurchases" in this prospectus supplement;
- any amounts paid to purchase or otherwise acquire all the mortgage loans
and any REO Properties in connection with the termination of the trust as
contemplated under "Description of the Offered Certificates--Termination"
in this prospectus supplement;
- any amounts required to be deposited by the master servicer in connection
with losses incurred with respect to Permitted Investments of funds held
in the collection account;
- all payments required to be paid by the master servicer or the special
servicer with respect to any deductible clause in any blanket or master
forced place insurance policy as described under "--Maintenance of
Insurance" below;
- any amount required to be transferred from the special servicer's REO
account;
- any amounts required to be transferred from any debt service reserve
accounts with respect to the mortgage loans; and
- insofar as they do not constitute escrow payments, any amounts paid by a
borrower specifically to cover items for which a servicing advance has
been made.
Upon receipt of any of the amounts described in the first five bullet
points of the prior paragraph with respect to any specially serviced mortgage
loan in the trust, the special servicer is required to promptly remit these
amounts to the master servicer for deposit in the master servicer's collection
account.
Withdrawals. The master servicer may make withdrawals from its collection
account for any of the following purposes, which are not listed in any order of
priority:
1. to remit to the certificate administrator for deposit in the payment
account maintained by the certificate administrator, as described under
"Description of the Offered Certificates--Payment Account" in this
prospectus supplement, on the business day preceding each payment date,
all payments and other collections on the mortgage loans and any REO
Properties in the trust that are then on deposit in the collection
account, exclusive of any portion of those payments and other
collections that represents one or more of the following--
(a) monthly debt service payments due on a due date subsequent to the
end of the related collection period,
(b) payments and other collections received after the end of the
related collection period, and
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(c) amounts that are payable or reimbursable from the collection
account to any person other than the series 2000-C3
certificateholders in accordance with any of clauses 2. through 17.
below;
2. to reimburse itself, the special servicer or the trustee, as
applicable, for any unreimbursed advances made by that party under the
pooling and servicing agreement, which reimbursement is to be made out
of collections on the mortgage loan or REO Property in the trust as to
which the advance was made;
3. to pay itself earned and unpaid master servicing fees with respect to
each mortgage loan in the trust, which payment is to be made out of
collections on that mortgage loan that are allocable as interest;
4. to pay the special servicer, out of general collections on the mortgage
loans and any REO Properties in the trust, earned and unpaid special
servicing fees with respect to each mortgage loan in the trust that is
either--
(a) a specially serviced mortgage loan, or
(b) a mortgage loan as to which the related mortgaged real property has
become an REO Property;
5. to pay the special servicer or, if applicable, its predecessor earned
and unpaid workout fees and liquidation fees to which it is entitled,
which payment is to be made from the sources described under
"--Servicing and Other Compensation and Payment of Expenses" above;
6. to reimburse itself, the special servicer or the trustee, as
applicable, out of general collections on the mortgage loans and any
REO Properties in the trust, for any unreimbursed advance made by that
party under the pooling and servicing agreement that has been
determined not to be ultimately recoverable under clause 2. above;
7. to pay itself, the special servicer or the trustee, as applicable,
unpaid interest on any advance made by that party under the pooling and
servicing agreement, and to pay any other unpaid expense, except
special servicing fees, that, if paid from a source other than Default
Interest, would constitute Additional Trust Fund Expenses, which
payments are to be made out of Default Interest received with respect
to any mortgage loan in the trust;
8. in connection with the reimbursement of advances as described in clause
2. or 6. above, to pay itself, the special servicer or the trustee, as
the case may be, out of general collections on the mortgage loans and
any REO Properties in the trust, any interest accrued and payable on
that advance and not otherwise paid or payable, as the case may be,
under clause 7. above;
9. to pay itself any items of additional master servicing compensation on
deposit in the collection account as discussed under "--Servicing and
Other Compensation and Payment of Expenses--Additional Master Servicing
Compensation" above;
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10. to pay the special servicer any items of additional special servicing
compensation on deposit in the collection account as discussed under
"--Servicing and Other Compensation and Payment of Expenses--Additional
Special Servicing Compensation" above;
11. to pay any unpaid liquidation expenses incurred with respect to any
liquidated mortgage loan or REO Property in the trust, which payment is
to be made out of collections on that mortgage loan or REO Property, as
the case may be;
12. subject to the determinations described under "--Servicing and Other
Compensation and Payment of Expenses" above, to pay, out of general
collections on the mortgage loans and any REO Properties in the trust,
any servicing expenses that would, if advanced, be nonrecoverable under
clause 2. above;
13. to pay, out of general collections on the mortgage loans and any REO
Properties in the trust, for costs and expenses incurred by the trust
in connection with the remediation of adverse environmental conditions
at any mortgaged real property that secures a defaulted mortgage loan
in the trust;
14. to pay itself, the special servicer, the trustee, the certificate
administrator, the tax administrator, us or any of their or our
respective directors, officers, managers, members, employees and
agents, as the case may be, out of general collections on the mortgage
loans and any REO Properties in the trust, any of the reimbursements or
indemnities to which we or any of those other persons or entities are
entitled as described under "Description of the Governing
Documents--Matters Regarding the Master Servicer, the Special Servicer,
the Manager and Us" and "Description of the Governing
Documents--Matters Regarding the Trustee" in the accompanying
prospectus and under "Description of the Offered Certificates -- The
Certificate Administrator and the Tax Administrator" in this prospectus
supplement;
15. to pay, out of general collections on the mortgage loans and any REO
Properties in the trust, for the costs of various opinions of counsel,
the cost of recording the pooling and servicing agreement and expenses
properly incurred by the tax administrator in connection with providing
advice to the special servicer;
16. to pay any other items provided in the pooling and servicing agreement
as being payable from the collection account;
17. to withdraw amounts deposited in the collection account in error,
including amounts received on any mortgage loan or REO Property that
has been purchased or otherwise removed from the trust; and
18. to clear and terminate the collection account upon the termination of
the pooling and servicing agreement.
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MAINTENANCE OF INSURANCE
The pooling and servicing agreement will require the master servicer to use
reasonable efforts, consistent with the Servicing Standard, to cause the
borrower under each of the pooled mortgage loans to maintain for each mortgaged
real property all insurance coverage as is required under the related mortgage
loan. If the borrower under any of the pooled mortgage loans fails to maintain
the required insurance, the master servicer will be required to cause to be
maintained for the related mortgaged property, to the extent consistent with the
Servicing Standard and available at commercially reasonable rates, all insurance
coverage as is required under that mortgage loan.
The special servicer will be required to cause to be maintained for each
REO Property, to the extent consistent with the Servicing Standard and available
at commercially reasonable rates, no less insurance coverage than was previously
required of the applicable borrower under the related mortgage loan.
If either the master servicer or the special servicer obtains and maintains
a blanket policy or master forced place policy insuring against hazard losses on
all the mortgage loans or REO Properties, as the case may be, in the trust,
then, to the extent that the policy--
- is obtained from an insurer having a claims-paying ability or financial
strength rating that meets, or whose obligations are guaranteed by an
entity having a claims-paying ability or financial strength rating that
meets, the requirements of the pooling and servicing agreement, and
- provides protection equivalent to the individual policies otherwise
required,
the master servicer or the special servicer, as the case may be, will be deemed
to have satisfied its obligation to cause hazard insurance to be maintained on
the related mortgaged real properties or REO Properties, as the case may be.
That blanket policy or master forced place policy may contain a customary
deductible clause, except that if there has not been maintained on the related
mortgaged real property or REO Property an individual hazard insurance policy
complying with the requirements described above in this "--Maintenance of
Insurance" section, and there occur one or more losses that would have been
covered by an individual policy, taking into account any applicable deductible,
then the master servicer or special servicer, as appropriate, must promptly
deposit into the master servicer's custodial account from its own funds the
amount of those losses that would have been covered by an individual policy,
taking into account any applicable deductible, but are not covered under the
blanket policy or master forced place policy because of that deductible clause.
REALIZATION UPON DEFAULTED MORTGAGE LOANS
The pooling and servicing agreement grants to the master servicer, the
special servicer and any single certificateholder or group of certificateholders
of the series 2000-C3 controlling class, a right to purchase from the trust
defaulted mortgage loans in the priority described in the next paragraph.
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If the special servicer has determined, in its judgment, that any defaulted
mortgage loan will become subject to foreclosure or similar proceedings and that
the sale of that mortgage loan by the trust under the circumstances described
below in this paragraph, is in accordance with the Servicing Standard, the
special servicer must give prompt written notice of its determination to the
trustee, the certificate administrator and the master servicer. The certificate
administrator will then be required, within five days after receipt of that
notice, to provide a copy of that notice to all certificateholders of the series
2000-C3 controlling class. Any single certificateholder or group of
certificateholders of the series 2000-C3 controlling class may, at its or their
option, within 15 days after receiving the notice from the certificate
administrator, purchase that defaulted mortgage loan from the trust, at a cash
price generally equal to--
- the Stated Principal Balance of the subject mortgage loan,
- all unpaid and unadvanced interest, other than any Post-ARD Additional
Interest and Default Interest, with respect to the subject mortgage loan
up to, but not including, the due date in the collection period of
purchase, and
- all unreimbursed advances with respect to the subject mortgage loan,
together with any unpaid interest on those advances owing to the party or
parties that made them.
If two or more separate certificateholders or groups of certificateholders of
the series 2000-C3 controlling class want to purchase the defaulted mortgage
loan, preference will be given to the certificateholder or group of
certificateholders with the largest interest in the series 2000-C3 controlling
class. If certificateholders of the series 2000-C3 controlling class have not
purchased that defaulted mortgage loan within the applicable period of their
having received the relevant notice, then for a limited period, either the
special servicer or the master servicer, in that order of priority, may at its
option purchase the defaulted mortgage loan from the trust at the same cash
price as was applicable for the certificateholders of the series 2000-C3
controlling class. Each of the master servicer and the special servicer may
designate an affiliate to complete the purchase. Any purchase described above in
this paragraph may be subject to the primary servicing rights of a sub-servicer.
The special servicer may offer to sell, on behalf of the trust, any
defaulted mortgage loan not otherwise purchased as described in the preceding
paragraph, if and when the special servicer determines, consistent with the
Servicing Standard, that a sale would be in the best economic interests of the
series 2000-C3 certificateholders, as a collective whole. Any offer must be made
in a commercially reasonable manner for a period of not less than 15 days.
Subject to the discussion in the next paragraph and under "--The Series 2000-C3
Controlling Class Representative" above, the special servicer will be required
to accept the highest cash bid received from any person that is a fair price,
determined in accordance with the pooling and servicing agreement, for the
mortgage loan.
The special servicer will not be obligated to accept the highest cash bid
if the special servicer determines, in accordance with the Servicing Standard,
that rejection of
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the highest cash bid would be in the best interests of the series 2000-C3
certificateholders, as a collective whole. Furthermore, subject to the
discussion under "--The Series 2000-C3 Controlling Class Representative" above,
the special servicer may accept a lower cash bid from any person or entity,
other than itself or an affiliate, if it determines, in accordance with the
Servicing Standard, that acceptance of the bid would be in the best interests of
the series 2000-C3 certificateholders, as a collective whole. For example, the
prospective buyer making the lower bid may be more likely to perform its
obligations or the terms, other than the price, offered by the prospective buyer
making the lower bid may be more favorable.
None of the trustee, the certificate administrator, the tax administrator,
or any of their respective affiliates may bid for or purchase from the trust any
defaulted mortgage loan or any REO Property.
In connection with the sale of any defaulted mortgage loan on behalf of the
trust, the special servicer may charge prospective bidders, and retain, fees
that approximate the special servicer's actual costs in the preparation and
delivery of information pertaining to the sales or evaluating bids without
obligation to deposit the amounts into the master servicer's collection account.
If a default on a pooled mortgage loan has occurred or, in the special
servicer's judgment, a payment default is imminent, then, subject to the
discussion under "--The Series 2000-C3 Controlling Class Representative" above,
the special servicer may, on behalf of the trust, take any of the following
actions:
- institute foreclosure proceedings;
- exercise any power of sale contained in the related mortgage;
- obtain a deed in lieu of foreclosure; or
- otherwise acquire title to the corresponding mortgaged real property, by
operation of law or otherwise.
The special servicer may not, however, acquire title to any mortgaged real
property, have a receiver of rents appointed with respect to any mortgaged real
property or take any other action with respect to any mortgaged real property
that would cause the trustee, for the benefit of the certificateholders, or any
other specified person to be considered to hold title to, to be a
"mortgagee-in-possession" of, or to be an "owner" or an "operator" of the
particular real property within the meaning of various federal environmental
laws, unless--
- the special servicer has previously received a report prepared by a
person who regularly conducts environmental audits, which report will be
an expense of the trust, and
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- subject to the discussion under "--The Series 2000-C3 Controlling Class
Representative" above, either:
1. the report indicates that--
(a) the particular real property is in compliance with applicable
environmental laws and regulations, and
(b) there are no circumstances or conditions present at the real
property that have resulted in any contamination for which
investigation, testing, monitoring, containment, clean-up or
remediation could be required under any applicable
environmental laws and regulations; or
2. the special servicer, based on the information set forth in the
report, determines that taking the actions necessary to bring the
particular real property into compliance with applicable
environmental laws and regulations and/or taking any of the other
actions contemplated by clause 1. above, is reasonably likely to
produce a greater recovery for the series 2000-C3
certificateholders, on a present value basis, than not taking those
actions.
If neither of the conditions in clauses 1. and 2. of the prior paragraph
are satisfied, the special servicer may, subject to the discussion under "--The
Series 2000-C3 Controlling Class Representative" above, take those actions as
are in accordance with the Servicing Standard, other than proceeding against the
contaminated mortgaged real property. In addition, when the special servicer
determines it to be appropriate, it may, subject to the discussion under "--The
Series 2000-C3 Controlling Class Representative" above, on behalf of the trust,
release all or a portion of the related mortgaged real property from the lien of
the related mortgage instrument.
If the trust acquires title to any mortgaged real property, the special
servicer, on behalf of the trust, has to sell the particular real property prior
to the close of the third taxable year following the taxable year in which that
acquisition occurred, subject to limited exceptions as described under "--REO
Properties" below.
If liquidation proceeds collected with respect to a defaulted mortgage loan
in the trust are less than the outstanding principal balance of the defaulted
mortgage loan, together with accrued interest on and reimbursable expenses
incurred by the special servicer and/or the master servicer in connection with
the defaulted mortgage loan, then the trust will realize a loss in the amount of
the shortfall. The special servicer and/or the master servicer will be entitled
to reimbursement out of the liquidation proceeds recovered on any defaulted
mortgage loan, prior to the payment of the liquidation proceeds to the series
2000-C3 certificateholders, for--
- any and all amounts that represent unpaid servicing compensation with
respect to the mortgage loan,
- unreimbursed servicing expenses incurred with respect to the mortgage
loan, and
- any unreimbursed advances of delinquent payments made with respect to the
mortgage loan.
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In addition, amounts otherwise payable on the series 2000-C3 certificates
may be further reduced by interest payable to the master servicer, the special
servicer and/or the trustee on the servicing expenses and advances.
REO PROPERTIES
If title to any mortgaged real property is acquired by the special servicer
on behalf of the trust, the special servicer will be required to sell that
property not later than the end of the third calendar year following the year of
acquisition, unless--
- the IRS grants an extension of time to sell the property, or
- the special servicer obtains an opinion of independent counsel generally
to the effect that the holding of the property subsequent to the end of
the third calendar year following the year in which the acquisition
occurred will not result in the imposition of a tax on the trust assets
or cause any of REMIC I, REMIC II or REMIC III to fail to qualify as a
REMIC under the Internal Revenue Code of 1986.
Subject to the foregoing, the special servicer will generally be required
to solicit cash offers for any REO Property held by the trust in a manner that
will be reasonably likely to realize a fair price for the property. The special
servicer may retain an independent contractor to operate and manage the REO
Property. The retention of an independent contractor will not relieve the
special servicer of its obligations with respect to the REO Property. Regardless
of whether the special servicer applies for or is granted an extension of time
to sell the property, the special servicer must act in accordance with the
Servicing Standard to liquidate the property on a timely basis. If an extension
is granted or opinion given, the special servicer must sell the REO Property
within the period specified in the extension or opinion.
In general, the special servicer or an independent contractor employed by
the special servicer at the expense of the trust will be obligated to operate
and manage any REO Property held by the trust in a manner that:
1. maintains its status as foreclosure property under the REMIC provisions
of the Internal Revenue Code of 1986, and
2. is in accordance with the Servicing Standard.
The special servicer must review the operation of each REO Property held by
the trust and consult with the tax administrator to determine the trust's
federal income tax reporting position with respect to the income it is
anticipated that the trust would derive from the property. The special servicer
could determine that it would not be consistent with the Servicing Standard to
manage and operate the property in a manner that would avoid the imposition of--
- a tax on net income from foreclosure property, within the meaning of
Section 857(b)(4)(B) of the Internal Revenue Code of 1986, or
- a tax on prohibited transactions under Section 860F of the Internal
Revenue Code of 1986.
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This determination is most likely to occur in the case of an REO Property
that is a hotel or residential health care facility. To the extent that income
the trust receives from an REO Property is subject to--
- a tax on net income from foreclosure property, that income would be
subject to federal tax at the highest marginal corporate tax rate, which
is currently 35%, or
- a tax on prohibited transactions, that income would be subject to federal
tax at a 100% rate.
The determination as to whether income from an REO Property held by the
trust would be subject to a tax will depend on the specific facts and
circumstances relating to the management and operation of each REO Property.
Generally, income from an REO Property that is directly operated by the special
servicer would be apportioned and classified as service or non-service income.
The service portion of the income could be subject to federal tax either at the
highest marginal corporate tax rate or at the 100% rate. The non-service portion
of the income could be subject to federal tax at the highest marginal corporate
tax rate or, although it appears unlikely, at the 100% rate. Any tax imposed on
the trust's income from an REO Property would reduce the amount available for
payment to the series 2000-C3 certificateholders. See "Federal Income Tax
Consequences" in this prospectus supplement and in the accompanying prospectus.
The reasonable out-of-pocket costs and expenses of obtaining professional tax
advice in connection with the foregoing will be payable out of the master
servicer's collection account.
One mortgaged real property, securing 1.22% of the initial mortgage pool
balance, is located in Puerto Rico. If the trust acquires a real property
located in Puerto Rico, it would be subject to Puerto Rican taxation with
respect to the income derived from that real property. If the activities of the
trust in Puerto Rico in relation to such real property constituted a trade or
business, the trust would be subject to income tax at up to a 39% rate with
respect to its net income attributable to the operation of the real property, as
well as a tax on any gain derived from the sale of the property. In the case of
gain from the sale of real property used in a trade or business, in general, tax
would be imposed at a 25% rate if that real property were held as a capital
asset for more than six months. If the activities of the trust did not
constitute the conduct of a trade or business in Puerto Rico, income derived
from the real property, such as rental payments, would be subject to Puerto
Rican withholding tax at a 29% rate. In addition, any gain on the sale of the
property would be subject to tax at a 29% rate, and such tax may be collected
through withholding.
The special servicer will be required to segregate and hold all funds
collected and received in connection with any REO Property held by the trust
separate and apart from its own funds and general assets. If an REO Property is
acquired by the trust, the special servicer will be required to establish and
maintain an account for the retention of revenues and other proceeds derived
from the REO Property. That REO account must be maintained in a manner and with
a depository institution that satisfies rating agency standards for
securitizations similar to the one involving the offered certificates. The
special servicer will be required to deposit, or cause to be deposited, in its
REO account,
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within one business day after receipt, all net income, insurance proceeds,
condemnation proceeds and liquidation proceeds received with respect to each REO
Property held by the trust. The funds held in this REO account may be held as
cash or invested in Permitted Investments. Any interest or other income earned
on funds in the special servicer's REO account will be payable to the special
servicer, subject to the limitations described in the pooling and servicing
agreement.
The special servicer will be required to withdraw from its REO account
funds necessary for the proper operation, management, leasing, maintenance and
disposition of any REO Property held by the trust, but only to the extent of
amounts on deposit in the account relating to that particular REO Property.
Promptly following the end of each collection period, the special servicer will
be required to withdraw from the REO account and deposit, or deliver to the
master servicer for deposit, into the master servicer's collection account the
total of all amounts received with respect to each REO Property held by the
trust during that collection period, net of--
- any withdrawals made out of those amounts as described in the preceding
sentence, and
- any portion of those amounts that may be retained as reserves as
described in the next sentence.
The special servicer may, subject to the limitations described in the pooling
and servicing agreement, retain in its REO account the portion of the proceeds
and collections as may be necessary to maintain a reserve of sufficient funds
for the proper operation, management, leasing, maintenance and disposition of
the related REO Property, including the creation of a reasonable reserve for
repairs, replacements, necessary capital improvements and other related
expenses.
The special servicer will be required to keep and maintain separate
records, on a property-by-property basis, for the purpose of accounting for all
deposits to, and withdrawals from, its REO account.
INSPECTIONS; COLLECTION OF OPERATING INFORMATION
The special servicer will be required, at the expense of the trust, to
inspect or cause an inspection of the corresponding mortgaged real property as
soon as practicable after any pooled mortgage loan becomes a specially serviced
mortgage loan. Beginning in 2001, the master servicer or, in the case of
specially serviced mortgage loans and REO Properties in the trust, the special
servicer, will be required, at its own expense, to inspect or cause an
inspection of each mortgaged real property at least once per calendar year or,
in the case of each pooled mortgage loan with an unpaid principal balance of
under $2,000,000, once every two years. The master servicer and the special
servicer will each be required to prepare or cause the preparation of a written
report of each inspection performed by it that generally describes the condition
of the particular real property and that specifies--
- any sale, transfer or abandonment of the property of which the master
servicer or the special servicer, as applicable, is aware,
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- any change in the property's condition, occupancy or value that the
master servicer or the special servicer, as applicable, in accordance
with the Servicing Standard, is aware of and considers to be material, or
- any waste committed on the property that the master servicer or the
special servicer, as applicable, in accordance with the Servicing
Standard, is aware of and considers to be material.
The master servicer and the special servicer will each be required, upon
request, to deliver to the certificate administrator or its designee a copy of
the inspection reports prepared or caused to be prepared by it, in each case
within 60 days following completion of the related inspection.
The special servicer, in the case of each specially serviced mortgage loan
in the trust, and the master servicer, in the case of each other mortgage loan
in the trust, will each be required to use reasonable efforts to collect from
the related borrower, review and, upon request, deliver to the certificate
administrator copies of, the following items, to the extent that those items are
required to be delivered under the related loan documents:
- the quarterly and annual operating statements, budgets and rent rolls of
the corresponding mortgaged real property; and
- the quarterly and annual financial statements of the borrower.
However, there can be no assurance that any of those items required to be
delivered by a borrower will in fact be delivered, nor is the master servicer or
the special servicer likely to have any practical means of compelling delivery.
The special servicer will also be required to cause the preparation of, and
deliver to the master servicer and, upon request, the certificate administrator
copies of, quarterly and annual operating statements, budgets and rent rolls for
each REO Property in the trust.
EVIDENCE AS TO COMPLIANCE
On or before April 15 of each year, beginning in 2002, each of the master
servicer and the special servicer must--
- at its expense, cause a firm of independent public accountants, that is a
member of the American Institute of Certified Public Accountants to
furnish a statement to the trustee and the certificate administrator,
among others, to the effect that--
1. it has obtained a letter of representation regarding certain matters
from the management of the master servicer or the special servicer,
as the case may be, which includes an assertion that the master
servicer or the special servicer, as the case may be, has complied
with certain minimum mortgage loan servicing standards, to the
extent applicable to commercial and multifamily mortgage loans,
identified in the Uniform Single Attestation Program for Mortgage
Bankers established by the Mortgage Bankers Association of America,
with respect to the servicing of commercial and
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multifamily mortgage loans during the most recently completed
calendar year, and
2. on the basis of an examination conducted by that firm in accordance
with standards set by the American Institute of Certified Public
Accountants, that representation is fairly stated in all material
respects, subject to any exceptions and other qualifications as may
be appropriate.
In rendering its report the firm may rely, as to matters relating to the
direct servicing of commercial and multifamily mortgage loans by
sub-servicers, upon comparable reports of firms of independent certified
public accountants rendered on the basis of examinations conducted in
accordance with the same standards, within one year of the report, with
respect to those sub-servicers.
- deliver to the trustee and the certificate administrator, among others, a
statement signed by an officer of the master servicer or the special
servicer, as the case may be, to the effect that, to the best knowledge
of that officer, the master servicer or special servicer, as the case may
be, has fulfilled its obligations under the pooling and servicing
agreement in all material respects throughout the preceding calendar year
or portion of that year during which the series 2000-C3 certificates were
outstanding.
EVENTS OF DEFAULT
Each of the following events, circumstances and conditions will be
considered events of default under the pooling and servicing agreement:
- the master servicer or the special servicer fails to deposit, or to remit
to the appropriate party for deposit, into the master servicer's
collection account or the special servicer's REO account, as applicable,
any amount required to be so deposited, and that failure continues
unremedied for one business day following the date on which the deposit
or remittance was required to be made;
- the master servicer fails to remit to the certificate administrator for
deposit in the payment account maintained by the certificate
administrator in the name of the trustee any amount required to be so
remitted, and that failure continues unremedied until 11:00 a.m., New
York City time, on the applicable payment date;
- the master servicer or the special servicer fails to timely make, or the
special servicer fails to timely request the master servicer to make, any
servicing advance required to be made by it under the pooling and
servicing agreement, and that failure continues unremedied for three
business days following the date on which notice has been given to the
master servicer or the special servicer, as the case may be, by the
trustee;
- the master servicer or the special servicer fails to observe or perform
in any material respect any of its other covenants or agreements under
the pooling and servicing agreement, and that failure continues
unremedied for 60 days after
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written notice of it has been given to the master servicer or the special
servicer, as the case may be, by any other party to the pooling and
servicing agreement or by series 2000-C3 certificateholders entitled to
not less than 25% of the voting rights for the series;
- it is determined that there is a breach by the master servicer or the
special servicer of any of its representations or warranties contained in
the pooling and servicing agreement that materially and adversely affects
the interests of any class of series 2000-C3 certificateholders, and that
breach continues unremedied for 60 days after written notice of it has
been given to the master servicer or the special servicer, as the case
may be, by any other party to the pooling and servicing agreement or by
the series 2000-C3 certificateholders entitled to not less than 25% of
the voting rights for the series;
- a decree or order of a court, agency or supervisory authority having
jurisdiction in an involuntary case under any present or future
bankruptcy, insolvency or similar law for the appointment of a
conservator, receiver, liquidator, trustee or similar official in any
bankruptcy, insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings is entered against the master servicer
or the special servicer and the decree or order remains in force for a
period of 60 days;
- the master servicer or special servicer consents to the appointment of a
conservator, receiver, liquidator, trustee or similar official in any
bankruptcy, insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to it or of or relating
to all or substantially all of its property;
- the master servicer or special servicer admits in writing its inability
to pay its debts or takes other actions indicating its insolvency or
inability to pay its obligations;
- the trustee and/or the certificate administrator receives written notice
from Moody's that the continuation of the master servicer or the special
servicer in that capacity would result or has resulted in a
qualification, downgrade or withdrawal of any rating then assigned by
that rating agency to any class of the series 2000-C3 certificates; and
- the master servicer or the special servicer is removed from S&P's
approved master servicer list or special servicer list, as the case may
be, and the ratings of any of the series 2000-C3 certificates by S&P are
downgraded, qualified or withdrawn, or placed on "negative credit watch",
in connection with that removal.
When a single entity acts as master servicer and special servicer, an event
of default, other than one described in the last two bullets of the prior
paragraph, in one capacity will be an event of default in the other capacity.
S-111
<PAGE> 112
RIGHTS UPON EVENT OF DEFAULT
If an event of default described above under "--Events of Default" occurs
with respect to the master servicer or the special servicer and remains
unremedied, the trustee will be authorized, and at the direction of the series
2000-C3 certificateholders entitled to a majority of the voting rights for the
series, the trustee will be required, to terminate all of the rights and
obligations of the defaulting party under the pooling and servicing agreement
and in and to the trust assets other than any rights the defaulting party may
have as a series 2000-C3 certificateholder. Upon any termination, the trustee
must either:
- succeed to all of the responsibilities, duties and liabilities of the
master servicer or special servicer, as the case may be, under the
pooling and servicing agreement; or
- appoint an established mortgage loan servicing institution to act as
successor master servicer or special servicer, as the case may be.
The holders of series 2000-C3 certificates entitled to a majority of the
voting rights for the series may require the trustee to appoint an established
mortgage loan servicing institution to act as successor master servicer or
special servicer, as the case may be, rather than have the trustee act as that
successor. The appointment of a successor special servicer by the trustee is
subject to the rights of the controlling class of series 2000-C3
certificateholders to designate a successor special servicer as described under
"--Replacement of the Special Servicer" above.
In general, the series 2000-C3 certificateholders entitled to at least
66 2/3% of the voting rights allocated to each class of series 2000-C3
certificates affected by any event of default may waive the event of default.
However, the events of default described in the first two and last two bullet
points under "--Events of Default" above may only be waived by all of the
holders of the series 2000-C3 certificates. Furthermore, if the trustee and/or
the certificate administrator is required to spend any monies in connection with
any event of default, then that event of default may not be waived unless and
until the trustee and/or the certificate administrator has been reimbursed, with
interest, by the defaulting party. Upon any waiver of an event of default, the
event of default will cease to exist and will be deemed to have been remedied
for every purpose under the pooling and servicing agreement.
S-112
<PAGE> 113
DESCRIPTION OF THE OFFERED CERTIFICATES
GENERAL
The series 2000-C3 certificates will be issued, on or about December 19,
2000, under the pooling and servicing agreement. They will represent the entire
beneficial ownership interest of the trust. The assets of the trust will
include:
- the pooled mortgage loans;
- any and all payments under and proceeds of the pooled mortgage loans
received after the cut-off date, exclusive of payments of principal,
interest and other amounts due on or before that date;
- the loan documents for the pooled mortgage loans;
- our rights under each of the mortgage loan purchase agreements between us
and the respective mortgage loan sellers;
- any REO Properties acquired by the trust with respect to defaulted
mortgage loans; and
- those funds or assets as from time to time are deposited in the master
servicer's collection account, the special servicer's REO account, the
payment account maintained by the certificate administrator in the name
of the trustee as described under "--Payment Account" below or the
interest reserve account maintained by the certificate administrator in
the name of the trustee as described under "--Payments" and "--Interest
Reserve Account" below.
The series 2000-C3 certificates will include the following classes:
- the A-1, A-2, B, C, D, E and F classes, which are the classes of series
2000-C3 certificates that are offered by this prospectus supplement, and
- the G, H, J, K, L, M, N, P, R, X and Y classes, which are the classes of
series 2000-C3 certificates that--
1. will be retained or privately placed by us, and
2. are not offered by this prospectus supplement.
The class A-1, A-2, B, C, D, E, F, G, H, J, K, L, M, N and P certificates
are the only series 2000-C3 certificates that will have principal balances. The
principal balance of any of these certificates will represent the total payments
of principal to which the holder of the certificate is entitled over time out of
payments, or advances in lieu of payments, and other collections on the assets
of the trust. Accordingly, on each payment date, the principal balance of each
of these certificates will be permanently reduced by any payments of principal
actually made with respect to the certificate on that payment date. See
"--Payments" below. On any particular payment date, the principal balance of
each of these certificates may also be permanently reduced, without any
corresponding payment, in connection with losses on the underlying mortgage
loans and default-related and otherwise unanticipated expenses of the trust. See
"--Reductions to Certificate Principal Balances in Connection With Realized
Losses and Additional Trust Fund Expenses" below.
S-113
<PAGE> 114
The class X certificates will not have principal balances, and the holders
of the class X certificates will not be entitled to receive payments of
principal. However, each class X certificate will have a notional amount for
purposes of calculating the accrual of interest with respect to that
certificate. The total notional amount of all the class X certificates will
equal the total principal balance of all the class A-1, A-2, B, C, D, E, F, G,
H, J, K, L, M, N and P certificates outstanding from time to time.
In general, principal balances and notional amounts will be reported on a
class-by-class basis. In order to determine the principal balance or notional
amount of any of your offered certificates from time to time, you may multiply
the original principal balance or notional amount of that certificate as of the
date of initial issuance of the offered certificates, as specified on the face
of that certificate, by the then-applicable certificate factor for the relevant
class. The certificate factor for any class of offered certificates, as of any
date of determination, will equal a fraction, expressed as a percentage, the
numerator of which will be the then outstanding total principal balance or
notional amount, as applicable, of that class, and the denominator of which will
be the original total principal balance or notional amount, as applicable, of
that class. Certificate factors will be reported monthly in the certificate
administrator's payment date statement.
REGISTRATION AND DENOMINATIONS
General. The offered certificates will be issued in book-entry form in
original denominations of $10,000 initial principal balance and in any whole
dollar denomination in excess of $10,000.
Each class of offered certificates will initially be represented by one or
more certificates registered in the name of Cede & Co., as nominee of The
Depository Trust Company. You will not be entitled to receive an offered
certificate issued in fully registered, certificated form, except under the
limited circumstances described in the accompanying prospectus under
"Description of the Certificates--Book-Entry Registration". For so long as any
class of offered certificates is held in book-entry form--
- all references in this prospectus supplement to actions by holders of
those certificates will refer to actions taken by DTC upon instructions
received from beneficial owners of those certificates through its
participating organizations, and
- all references in this prospectus supplement to payments, notices,
reports, statements and other information made or sent to holders of
those certificates will refer to payments, notices, reports and
statements made or sent to DTC or Cede & Co., as the registered holder of
those certificates, for payment or transmittal, as applicable, to the
beneficial owners of those certificates through its participating
organizations in accordance with DTC's procedures.
LaSalle Bank National Association will initially serve as registrar for
purposes of providing for the registration of the offered certificates and, if
and to the extent physical certificates are issued to the actual beneficial
owners of any of the offered certificates, the registration of transfers and
exchanges of those certificates.
S-114
<PAGE> 115
DTC, Clearstream and Euroclear. You will hold your certificates
through --
- DTC, in the United States, or
- in the case of the class A-1 and A-2 certificates, Clearstream Banking
societe anonyme or the Euroclear System, in Europe,
if you are a participating organization of the applicable system, or indirectly
through organizations that are participants in the applicable system.
Clearstream and Euroclear will hold omnibus positions on behalf of organizations
that are participants in either of these systems, through customers' securities
accounts in Clearstream's or Euroclear's names on the books of their respective
depositaries. Those depositaries will, in turn, hold those positions in
customers' securities accounts in the depositaries' names on the books of DTC.
For a discussion of DTC, Euroclear and Clearstream, see "Description of the
Certificates--Book-Entry Registration" in the accompanying prospectus.
Transfers between participants in DTC will occur in accordance with DTC's
rules. Transfers between participants in Clearstream and Euroclear will occur in
accordance with their applicable rules and operating procedures.
Cross-market transfers between persons holding directly or indirectly
through DTC, on the one hand, and directly through participants in Clearstream
or Euroclear, on the other, will be accomplished through DTC in accordance with
DTC rules on behalf of the relevant European international clearing system by
its depositary. However, these cross-market transactions will require delivery
of instructions to the relevant European international clearing system by the
counterparty in that system in accordance with its rules and procedures and
within its established deadlines (European time). The relevant European
international clearing system will, if the transaction meets it settlement
requirements, deliver instructions to its depositary to take action to effect
final settlement on its behalf by delivering or receiving securities through
DTC, and making or receiving payment in accordance with normal procedures for
same-day funds settlement applicable to DTC. Participants in Clearstream and
Euroclear may not deliver instructions directly to the depositaries.
Because of time-zone differences--
- credits of securities in Clearstream or Euroclear as a result of a
transaction with a DTC participant will be made during the subsequent
securities settlement processing, dated the business day following the
DTC settlement date, and
- those credits or any transactions in those securities settled during that
processing will be reported to the relevant Clearstream or Euroclear
participant on that business day.
Cash received in Clearstream or Euroclear as a result of sales of
securities by or through a Clearstream or Euroclear participant to a DTC
participant will be received with value on the DTC settlement date but will be
available in the relevant Clearstream or Euroclear cash account only as of the
business day following settlement in DTC. For additional information regarding
clearance and settlement procedures for the offered
S-115
<PAGE> 116
certificates and for information with respect to tax documentation procedures
relating to the offered certificates, see Annex D hereto.
Beneficial owners of offered certificates that are not participating
organizations in DTC, Clearstream or Euroclear, but desire to purchase, sell or
otherwise transfer ownership or other interests in those certificates, may do so
only through participating organizations in DTC, Clearstream or Euroclear, as
applicable. In addition, those beneficial owners will receive all payments of
principal and interest from the certificate administrator through DTC and its
participating organizations. Similarly, reports distributed to holders of the
offered certificates pursuant to the pooling and servicing agreement and
requests for the consent of those holders will be delivered to the beneficial
owners of those certificates only through DTC, Clearstream, Euroclear and their
participating organizations. Under a book-entry format, beneficial owners of
offered certificates may experience some delay in their receipt of payments,
reports and notices, since these payments, reports and notices will be forwarded
by the certificate administrator to Cede & Co., as nominee for DTC. DTC will
forward the payments, reports and notices to its participating organizations,
which thereafter will forward them to indirect DTC participants, Clearstream,
Euroclear or beneficial owners of the offered certificates, as applicable.
Under the rules, regulations and procedures creating and affecting DTC and
its operations, DTC is required to make book-entry transfers of offered
certificates among participating organizations on whose behalf it acts with
respect to the offered certificates and to receive and transmit payments of
principal of, and interest on, the offered certificates. Direct and indirect DTC
participants with which beneficial owners of the offered certificates have
accounts with respect to those certificates similarly are required to make
book-entry transfers and receive and transmit the payments on behalf of those
beneficial owners. Accordingly, although the beneficial owners of offered
certificates will not possess the offered certificates, the DTC rules provide a
mechanism that will allow them to receive payments on their certificates and
will be able to transfer their interests.
Because DTC can only act on behalf of direct DTC participants, who in turn
act on behalf of indirect DTC participants and certain banks, the ability of a
beneficial owner of offered certificates to pledge those certificates to persons
or entities that do not participate in the DTC system, or to otherwise act with
respect to those certificates, may be limited due to the lack of a physical
certificate for those certificates.
DTC has advised us that it will take any action permitted to be taken by
holders of the offered certificates under the pooling and servicing agreement
only at the direction of one or more participating organizations to whose
accounts with DTC those certificates are credited. DTC may take conflicting
actions with respect to other undivided interests to the extent that those
actions are taken on behalf of participating organizations in DTC whose holdings
include those undivided interests.
PAYMENT ACCOUNT
General. The certificate administrator must establish and maintain in the
name of the trustee an account in which it will hold funds pending their payment
on the series
S-116
<PAGE> 117
2000-C3 certificates and from which it will make those payments. That payment
account must be maintained in a manner and with a depository institution that
satisfies rating agency standards for securitizations similar to the one
involving the offered certificates. Funds held in the payment account will
remain uninvested.
Deposits. On the business day prior to each payment date, the master
servicer will be required to remit to the certificate administrator for deposit
in the payment account the following funds:
- All payments and other collections on the mortgage loans and any REO
Properties in the trust that are then on deposit in the master servicer's
collection account, exclusive of any portion of those payments and other
collections that represents one or more of the following:
1. monthly debt service payments due on a due date subsequent to the
end of the related collection period;
2. payments and other collections received after the end of the related
collection period;
3. amounts that are payable or reimbursable from the master servicer's
collection account to any person other than the series 2000-C3
certificateholders, including--
(a) amounts payable to the master servicer or the special servicer
as compensation,
(b) amounts payable in reimbursement of outstanding advances,
together with interest on those advances, and
(c) amounts payable with respect to other expenses of the trust;
and
4. amounts deposited in the master servicer's collection account in
error.
- Any advances of delinquent monthly debt service payments made with
respect to that payment date.
- Any payments made by the master servicer to cover Prepayment Interest
Shortfalls incurred during the related collection period.
See "--Advances of Delinquent Monthly Debt Service Payments" below and
"Servicing of the Underlying Mortgage Loans--Collection Account" and
"--Servicing and Other Compensation and Payment of Expenses" in this prospectus
supplement.
With respect to each payment date that occurs during March, commencing in
March 2001, the certificate administrator will be required to transfer from the
interest reserve account, which we describe under "--Interest Reserve Account"
below, to the payment account the interest reserve amounts that are then being
held in that interest reserve account with respect to those pooled mortgage
loans that accrue interest on an actual/360 basis.
S-117
<PAGE> 118
Withdrawals. The certificate administrator may from time to time make
withdrawals from its payment account for any of the following purposes:
- to pay itself and the trustee their respective portions of the monthly
trustee fee, which is described under "--The Trustee" below;
- to pay itself, the trustee, the tax administrator or any of their
respective directors, officers, employees and agents any reimbursements
or indemnities to which they are entitled as described under "Description
of the Governing Documents--Matters Regarding the Trustee" in the
accompanying prospectus and under "--The Certificate Administrator and
the Tax Administrator" below;
- to pay for any opinions of counsel required to be obtained in connection
with any amendments to the pooling and servicing agreement;
- to pay any federal, state and local taxes imposed on the trust, its
assets and/or transactions, together with all incidental costs and
expenses, that are required to be borne by the trust as described under
"Federal Income Tax Consequences--REMICs--Prohibited Transactions Tax and
Other Taxes" in the accompanying prospectus and "Servicing of the
Underlying Mortgage Loans--REO Properties" in this prospectus supplement;
- with respect to each payment date during February of any year or during
January of any year that is not a leap year, commencing in 2001, to
transfer to the interest reserve account described under "--Interest
Reserve Account" below the interest reserve amounts required to be so
transferred in that month with respect to those pooled mortgage loans
that accrue interest on an actual/360 basis; and
- to pay to the person entitled thereto any amounts deposited in the
payment account in error.
On each payment date, all amounts on deposit in the payment account,
exclusive of any portion of those amounts that are to be withdrawn for the
purposes contemplated in the foregoing paragraph, will be withdrawn and applied
to make payments on the series 2000-C3 certificates. For any payment date, those
funds will consist of three separate components--
- the portion of those funds that represent prepayment consideration
collected on the pooled mortgage loans as a result of voluntary or
involuntary prepayments that occurred during the related collection
period, which will be paid to the holders of the offered certificates
and/or the class X certificates as described under "--Payments--Payments
of Prepayment Premiums and Yield Maintenance Charges" below,
- the portion of those funds that represent Post-ARD Additional Interest
collected on the ARD Loans in the trust during the related collection
period, which will be paid to the holders of the class Y certificates as
described under "--Payments--Payments of Post-ARD Additional Interest"
below, and
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<PAGE> 119
- the remaining portion of those funds--
1. which we refer to as the Available P&I Funds, and
2. which will be paid to the holders of all the series 2000-C3
certificates, other than the class Y certificates, as and to the
extent described under "--Payments--Priority of Payments" below.
INTEREST RESERVE ACCOUNT
The certificate administrator must maintain in the name of the trustee an
account in which it will hold the interest reserve amounts described in the next
paragraph with respect to those underlying mortgage loans that accrue interest
on an actual/360 basis. That interest reserve account must be maintained in a
manner and with a depository that satisfies rating agency standards for
securitizations similar to the one involving the offered certificates. Funds
held in the interest reserve account will remain uninvested.
During January, except in a leap year, and February of each calendar year,
beginning in 2001, the certificate administrator will, on or before the payment
date in that month, withdraw from the payment account and deposit in the
interest reserve account the interest reserve amounts with respect to those
underlying mortgage loans that accrue interest on an actual/360 basis and for
which the monthly debt service payment due in that month was either received or
advanced. In general, that interest reserve amount for each of those mortgage
loans will equal one day's interest accrued at the related mortgage interest
rate, less the related Administrative Fee Rate, on the Stated Principal Balance
of that loan as of the end of the related collection period. In the case of an
ARD Loan, however, the interest reserve amount will not include Post-ARD
Additional Interest.
During March of each calendar year, beginning in 2001, the certificate
administrator will, on or before the payment date in that month, withdraw from
the interest reserve account and deposit in the payment account any and all
interest reserve amounts then on deposit in the interest reserve account with
respect to those underlying mortgage loans that accrue interest on an actual/360
basis. All interest reserve amounts that are so transferred from the interest
reserve account to the payment account will be included in the Available P&I
Funds for the payment date during the month of transfer.
PAYMENTS
General. On each payment date, the certificate administrator will,
subject to the available funds and the exception described in the next sentence,
remit all payments required to be made on the series 2000-C3 certificates on
that date to the holders of record as of the close of business on the last
business day of the calendar month preceding the month in which those payments
are to occur. The final payment of principal and/or interest on any offered
certificate, however, will be made only upon presentation and surrender of that
certificate at the location to be specified in a notice of the pendency of that
final payment.
S-119
<PAGE> 120
In order for a series 2000-C3 certificateholder to receive payments by wire
transfer on and after any particular payment date, that certificateholder must
provide the certificate administrator with written wiring instructions no later
than the last day of the calendar month preceding the month in which that
payment date occurs. Otherwise, that certificateholder will receive its payments
by check mailed to it.
Payments made to a class of series 2000-C3 certificateholders will be
allocated among those certificateholders in proportion to their respective
percentage interests in that class.
Cede & Co. will be the registered holder of your offered certificates, and
you will receive payments on your offered certificates through DTC and its
participating organizations, until physical certificates are issued, if ever, to
the actual beneficial owners. See "--Registration and Denominations" above.
Payments of Interest. All of the classes of the series 2000-C3
certificates will bear interest, except for the Y and R classes.
With respect to each interest-bearing class of the series 2000-C3
certificates, that interest will accrue during each interest accrual period
based upon--
- the pass-through rate for that class and the related payment date,
- the total principal balance or notional amount, as the case may be, of
that class outstanding immediately prior to the related payment date, and
- the assumption that each year consists of twelve 30-day months.
On each payment date, subject to the Available P&I Funds for that date and
the priorities of payment described under "--Payments--Priority of Payments"
below, the holders of each interest-bearing class of the series 2000-C3
certificates will be entitled to receive--
- the total amount of interest accrued during the related interest accrual
period with respect to that class of series 2000-C3 certificates, reduced
by
- the portion of any Net Aggregate Prepayment Interest Shortfall for that
payment date that is allocable to that class of series 2000-C3
certificates.
If the holders of any interest-bearing class of the series 2000-C3
certificates do not receive all of the interest to which they are entitled on
any payment date, then they will continue to be entitled to receive the unpaid
portion of that interest on future payment dates, subject to the Available P&I
Funds for those future payment dates and the priorities of payment described
under "--Payments--Priority of Payments" below. However, no interest will accrue
on any of that unpaid interest.
S-120
<PAGE> 121
The portion of any Net Aggregate Prepayment Interest Shortfall for any
payment date that is allocable to any particular interest-bearing class of the
series 2000-C3 certificates will equal the product of--
- the amount of that Net Aggregate Prepayment Interest Shortfall,
multiplied by
- a fraction--
1. the numerator of which is the total amount of interest accrued
during the related interest accrual period with respect to that
class of certificates, and
2. the denominator of which is the total amount of interest accrued
during the related interest accrual period with respect to all of
the interest-bearing classes of the series 2000-C3 certificates.
Calculation of Pass-Through Rates. The initial pass-through rate for each
interest-bearing class of the series 2000-C3 certificates is shown in the table
on page S-5 to this prospectus supplement.
The pass-through rates applicable to the class A-1, A-2, H, J, K, L, M, N
and P certificates for each subsequent payment date will, in the case of each of
those classes, remain fixed at the pass-through rate applicable to the
particular class of series 2000-C3 certificates for the initial payment date.
The pass-through rates applicable to the class B, C, D, E, F and G
certificates for each subsequent payment date will, in the case of each of those
classes, equal the lesser of--
- the pass-through rate applicable to the particular class of series
2000-C3 certificates for the initial payment date, and
- the Weighted Average Pool Pass-Through Rate for that subsequent payment
date.
The pass-through rate applicable to the class X certificates for each
subsequent payment date will equal the excess, if any, of--
- the Weighted Average Pool Pass-Through Rate for that payment date, over
- the weighted average of the pass-through rates for each of the other
interest-bearing classes of the series 2000-C3 certificates for that
payment date, weighted on the basis of the relative total principal
balances of those other classes of series 2000-C3 certificates
outstanding immediately prior to that payment date.
The calculation of the Weighted Average Pool Pass-Through Rate will be
unaffected by any change in the mortgage interest rate for any mortgage loan,
including in connection with any bankruptcy or insolvency of the related
borrower or any modification of that mortgage loan agreed to by the master
servicer or the special servicer.
Neither the class Y nor the class R certificates will be interest-bearing
and, therefore, neither will have pass-through rates.
Payments of Principal. Subject to the Available P&I Funds and the
priority of payments described under "--Payments--Priority of Payments" below,
the total amount
S-121
<PAGE> 122
of principal payable with respect to each class of the series 2000-C3
certificates, other than the class X, Y and R certificates, on each payment date
will equal that class's allocable share of the Total Principal Payment Amount
for that payment date.
In general, the portion of the Total Principal Payment Amount that will be
allocated to the class A-1 and A-2 certificates on each payment date will equal:
- in the case of the class A-1 certificates, the lesser of--
1. the entire Total Principal Payment Amount for that payment date and
2. the total principal balance of the class A-1 certificates
immediately prior to that payment date; and
- in the case of the class A-2 certificates, the lesser of--
1. the entire Total Principal Payment Amount for that payment date,
reduced by any portion of that amount allocable to the class A-1
certificates as described in the preceding bullet point, and
2. the total principal balance of the class A-2 certificates
immediately prior to that payment date.
However, if both of those classes are outstanding at a time when the total
principal balance of the class B, C, D, E, F, G, H, J, K, L, M, N and P
certificates has been reduced to zero as described under "--Reductions to
Certificate Principal Balances in Connection With Realized Losses and Additional
Trust Fund Expenses" below, then the Total Principal Payment Amount for each
payment date thereafter will be allocable between those two classes on a pro
rata basis in accordance with their respective total principal balances
immediately prior to that payment date, in each case up to that total principal
balance. In addition, if both of those classes are outstanding on the final
payment date for the series 2000-C3 certificates, then the Total Principal
Payment Amount will be similarly allocated between them.
WHILE THE CLASS A-1 AND/OR A-2 CERTIFICATES ARE OUTSTANDING, NO PORTION OF
THE TOTAL PRINCIPAL PAYMENT AMOUNT FOR ANY PAYMENT DATE WILL BE ALLOCATED TO ANY
OTHER CLASS OF SERIES 2000-C3 CERTIFICATES.
Following the retirement of the class A-1 and A-2 certificates, the Total
Principal Payment Amount for each payment date will be allocated to the
respective classes of series 2000-C3 certificates identified in the table below
and in the order of priority set forth in that table, in each case up to the
lesser of--
- the portion of that Total Principal Payment Amount that remains
unallocated, and
- the total principal balance of the particular class immediately prior to
that payment date.
S-122
<PAGE> 123
<TABLE>
<CAPTION>
ORDER OF ALLOCATION CLASS
------------------- -----
<S> <C>
1(st)................................. B
2(nd)................................. C
3(rd)................................. D
4(th)................................. E
5(th)................................. F
6(th)................................. G
7(th)................................. H
8(th)................................. J
9(th)................................. K
10(th)................................. L
11(th)................................. M
12(th)................................. N
13(th)................................. P
</TABLE>
IN NO EVENT WILL THE HOLDERS OF ANY CLASS OF SERIES 2000-C3 CERTIFICATES
LISTED IN THE FOREGOING TABLE BE ENTITLED TO RECEIVE ANY PAYMENTS OF PRINCIPAL
UNTIL THE TOTAL PRINCIPAL BALANCE OF THE CLASS A-1 AND A-2 CERTIFICATES IS
REDUCED TO ZERO. FURTHERMORE, IN NO EVENT WILL THE HOLDERS OF ANY CLASS OF
SERIES 2000-C3 CERTIFICATES LISTED IN THE FOREGOING TABLE BE ENTITLED TO RECEIVE
ANY PAYMENTS OF PRINCIPAL UNTIL THE TOTAL PRINCIPAL BALANCE OF ALL OTHER CLASSES
OF SERIES 2000-C3 CERTIFICATES, IF ANY, LISTED ABOVE IT IN THE FOREGOING TABLE
IS REDUCED TO ZERO.
Reimbursement Amounts. As discussed under "--Reductions of Certificate
Principal Balances in Connection with Realized Losses and Additional Trust Fund
Expenses" below, the total principal balance of any class of series 2000-C3
certificates, other than the class X, Y and R certificates, may be reduced
without a corresponding payment of principal. If that occurs with respect to any
class of series 2000-C3 certificates, then, subject to Available P&I Funds and
the priority of payment described under "--Payments--Priority of Payments"
below, the holders of that class will be entitled to be reimbursed for the
amount of that reduction, without interest.
Priority of Payments. On each payment date, the certificate administrator
will apply the Available P&I Funds for that date to make the following payments
in the following order of priority, in each case to the extent of the remaining
Available P&I Funds:
<TABLE>
<CAPTION>
ORDER OF RECIPIENT
PAYMENT CLASS OR CLASSES TYPE AND AMOUNT OF PAYMENT
-------- ---------------- --------------------------
<S> <C> <C>
1(st) A-1, A-2 and X Interest up to the total interest payable on those
classes, pro rata based on the total interest payable
on each class
2(nd) A-1 and A-2 Principal up to the total principal payable on those
classes, allocable as between those classes as
described immediately following this table
3(rd) A-1 and A-2 Reimbursement up to the reimbursement amounts for
those classes, pro rata based on the loss
reimbursement amount for each class
-----------------------------------------------------------------------------------
</TABLE>
S-123
<PAGE> 124
<TABLE>
<CAPTION>
ORDER OF RECIPIENT
PAYMENT CLASS OR CLASSES TYPE AND AMOUNT OF PAYMENT
-------- ---------------- --------------------------
<S> <C> <C>
4(th) B Interest up to the total interest payable on that
class
5(th) B Principal up to the total principal payable on that
class
6(th) B Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
7(th) C Interest up to the total interest payable on that
class
8(th) C Principal up to the total principal payable on that
class
9(th) C Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
10(th) D Interest up to the total interest payable on that
class
11(th) D Principal up to the total principal payable on that
class
12(th) D Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
13(th) E Interest up to the total interest payable on that
class
14(th) E Principal up to the total principal payable on that
class
15(th) E Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
16(th) F Interest up to the total interest payable on that
class
17(th) F Principal up to the total principal payable on that
class
18(th) F Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
19(th) G Interest up to the total interest payable on that
class
20(th) G Principal up to the total principal payable on that
class
21(st) G Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
22(nd) H Interest up to the total interest payable on that
class
23(rd) H Principal up to the total principal payable on that
class
24(th) H Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
25(th) J Interest up to the total interest payable on that
class
26(th) J Principal up to the total principal payable on that
class
27(th) J Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
28(th) K Interest up to the total interest payable on that
class
29(th) K Principal up to the total principal payable on that
class
30(th) K Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
</TABLE>
S-124
<PAGE> 125
<TABLE>
<CAPTION>
ORDER OF RECIPIENT
PAYMENT CLASS OR CLASSES TYPE AND AMOUNT OF PAYMENT
-------- ---------------- --------------------------
<S> <C> <C>
31(st) L Interest up to the total interest payable on that
class
32(nd) L Principal up to the total principal payable on that
class
33(rd) L Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
34(th) M Interest up to the total interest payable on that
class
35(th) M Principal up to the total principal payable on that
class
36(th) M Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
37(th) N Interest up to the total interest payable on that
class
38(th) N Principal up to the total principal payable on that
class
39(th) N Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
40(th) P Interest up to the total interest payable on that
class
41(st) P Principal up to the total principal payable on that
class
42(nd) P Reimbursement up to the loss reimbursement amount for
that class
-----------------------------------------------------------------------------------
43(rd) R Any remaining Available P&I Funds
</TABLE>
In general, no payments of principal will be made with respect to the class
A-2 certificates until the total principal balance of the class A-1 certificates
is reduced to zero. However, if both of those classes are outstanding at a time
when the total principal balance of the class B, C, D, E, F, G, H, J, K, L, M, N
and P certificates has been reduced to zero as described under "--Reductions to
Certificate Principal Balances in Connection With Realized Losses and Additional
Trust Fund Expenses" below, or if both of those classes are outstanding on the
final payment date for the series 2000-C3 certificates, then payments of
principal on the class A-1 certificates and the class A-2 certificates will be
made on a pro rata basis in accordance with the respective total principal
balances of those classes then outstanding.
References to "loss reimbursement amount" in the foregoing table mean, in
the case of any class of series 2000-C3 certificates, other than the class X, Y
and R certificates, for any payment date, the total amount to which the holders
of that class are entitled as reimbursement for all previously unreimbursed
reductions, if any, made in the total principal balance of that class on all
prior payment dates as discussed under "--Reductions to Certificate Principal
Balances in Connection With Realized Losses and Additional Trust Fund Expenses"
below.
Payments of Prepayment Premiums and Yield Maintenance Charges. If any
prepayment consideration is collected during any particular collection period
with respect to any mortgage loan in the trust, regardless of whether that
prepayment consideration is calculated as a percentage of the amount prepaid or
in accordance with a yield maintenance formula, then on the payment date
corresponding to that collection period,
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<PAGE> 126
the certificate administrator will pay a portion of that prepayment
consideration to the holders of each class of series 2000-C3 certificates,
exclusive of the class X certificates, that is senior to the class H
certificates, up to an amount equal to the product of --
- the full amount of that prepayment consideration, multiplied by
- a fraction, which in no event may be greater than 1.0 or less than 0.0,
the numerator of which is equal to the excess, if any, of the
pass-through rate for that class of series 2000-C3 certificates over the
monthly equivalent of the relevant discount rate, and the denominator of
which is equal to the excess, if any, of the mortgage interest rate of
the prepaid mortgage loan over the monthly equivalent of the relevant
discount rate, and further multiplied by
- a fraction, the numerator of which is equal to the amount of principal,
if any, payable to that class of series 2000-C3 certificates on that
payment date, and the denominator of which is the Total Principal Payment
Amount for that payment date.
The discount rate applicable to the class G certificates or any class of
offered certificates, with respect to any prepaid mortgage loan with a yield
maintenance discount rate of "Treasury Flat-Maturity", will equal the average
yield for "This Week" as reported by the Federal Reserve Board in Federal
Reserve Statistical Release H.15(519) for the constant maturity treasury
security having a maturity coterminous with the remaining term to maturity or
the related anticipated repayment date, as applicable, for the prepaid mortgage
loan. If there are no constant maturity treasuries having such a maturity, then
that discount rate will equal the interpolation of the yields of the constant
maturity treasuries with maturities longer and shorter than the remaining term
to maturity or the related anticipated repayment date, as applicable, for the
prepaid mortgage loan.
The discount rate applicable to the class G certificates or any class of
offered certificates, with respect to any prepaid mortgage loan with a yield
maintenance discount rate of "Treasury Flat-WAL", will equal the average yield
for "This Week" as reported by the Federal Reserve Board in Federal Reserve
Statistical Release H.15(519) for the constant maturity treasury security having
a maturity coterminous with the remaining weighted average life of the prepaid
mortgage loan. In the case of an ARD Loan, the remaining weighted average life
will be calculated assuming all principal is repaid on the anticipated repayment
date. If there are no constant maturity treasuries having such a maturity, then
that discount rate will equal the interpolation of the yields of the constant
maturity treasuries with maturities longer and shorter than the remaining
weighted average life for the prepaid mortgage loan.
The certificate administrator will thereafter remit any remaining portion
of the prepayment consideration on the subject payment date to the holders of
the class X certificates. After the payment date on which the total principal
balance of all classes of the offered certificates has been reduced to zero, the
certificate administrator will pay any prepayment consideration collected on the
pooled mortgage loans, entirely to the holders of the class X and/or class G
certificates.
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<PAGE> 127
Neither we nor any of the underwriters makes any representation as to--
- the enforceability of the provision of any promissory note evidencing one
of the mortgage loans requiring the payment of a prepayment premium or
yield maintenance charge, or
- the collectability of any prepayment premium or yield maintenance charge.
See "Description of the Mortgage Pool--Terms and Conditions of the
Underlying Mortgage Loans--Voluntary Prepayment Provisions" in this prospectus
supplement.
Payments of Post-ARD Additional Interest. The class Y certificates will
entitle holders to all amounts, if any, collected on the ARD Loans in the trust
and applied as Post-ARD Additional Interest.
Treatment of REO Properties. Notwithstanding that any mortgaged real
property may be acquired as part of the trust assets through foreclosure, deed
in lieu of foreclosure or otherwise, the related mortgage loan will be treated
as having remained outstanding, until the REO Property is liquidated, for
purposes of determining--
- payments on the series 2000-C3 certificates,
- allocations of Realized Losses and Additional Trust Fund Expenses to the
series 2000-C3 certificates, and
- the amount of all fees payable to the master servicer, the special
servicer and the trustee under the pooling and servicing agreement.
In connection with the foregoing, that mortgage loan will be taken into account
when determining the Weighted Average Pool Pass-Through Rate and the Total
Principal Payment Amount for each payment date.
Operating revenues and other proceeds derived from an REO Property will be
applied--
- first, to pay, or to reimburse the master servicer, the special servicer
and/or the trustee for the payment of, any costs and expenses incurred in
connection with the operation and disposition of the REO Property, and
- thereafter, as collections of principal, interest and other amounts due
on the related mortgage loan.
To the extent described under "--Advances of Delinquent Monthly Debt
Service Payments" below, the master servicer and the trustee will be required to
advance delinquent monthly debt service payments with respect to each pooled
mortgage loan as to which the corresponding mortgaged real property has become
an REO Property, in all cases as if the mortgage loan had remained outstanding.
REDUCTIONS TO CERTIFICATE PRINCIPAL BALANCES IN CONNECTION WITH REALIZED LOSSES
AND ADDITIONAL TRUST FUND EXPENSES
As a result of Realized Losses and Additional Trust Fund Expenses, the
total Stated Principal Balance of the mortgage pool may decline below the total
principal
S-127
<PAGE> 128
balance of the series 2000-C3 certificates. If this occurs following the
payments made to the series 2000-C3 certificateholders on any payment date, then
the respective total principal balances of the following classes of the series
2000-C3 certificates are to be sequentially reduced in the following order,
until the total principal balance of those classes of certificates equals the
total Stated Principal Balance of the mortgage pool that will be outstanding
immediately following that payment date.
<TABLE>
<CAPTION>
ORDER OF ALLOCATION CLASS
------------------- ------------------------
<S> <C>
1(st)................. P
2(nd)................. N
3(rd)................. M
4(th)................. L
5(th)................. K
6(th)................. J
7(th)................. H
8(th)................. G
9(th)................. F
10(th)................. E
11(th)................. D
12(th)................. C
13(th)................. B
14(th)................. A-1 and A-2, pro rata
based on total principal
balances.
</TABLE>
The above-described reductions in the total principal balances of the
respective classes of series 2000-C3 certificates identified in the foregoing
table will represent an allocation of the Realized Losses and/or Additional
Trust Fund Expenses that caused the particular mismatch in balances between the
pooled mortgage loans and those classes of series 2000-C3 certificates. A
reduction of this type in the total principal balance of any of the classes of
series 2000-C3 certificates identified in the foregoing table will result in a
corresponding reduction in the total notional amount of the class X
certificates.
In no event will the principal balance of any class of series 2000-C3
certificates identified in the foregoing table be reduced until the total
principal balance of all series 2000-C3 certificates listed above it in the
table has been reduced to zero.
The Realized Loss with respect to a liquidated mortgage loan, or related
REO Property, is an amount generally equal to the excess, if any, of:
- the outstanding principal balance of the mortgage loan as of the date of
liquidation, together with--
1. all accrued and unpaid interest on the mortgage loan to but not
including the due date in the collection period in which the
liquidation occurred,
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<PAGE> 129
exclusive, however, of any portion of that interest that represents
Default Interest or Post-ARD Additional Interest, and
2. all related unreimbursed servicing advances and unpaid liquidation
expenses; over
- the total amount of liquidation proceeds, if any, recovered in connection
with the liquidation.
If any portion of the debt due under a pooled mortgage loan is forgiven,
whether in connection with a modification, waiver or amendment granted or agreed
to by the master servicer or the special servicer or in connection with the
bankruptcy, insolvency or similar proceeding involving the related borrower, the
amount forgiven, other than Default Interest and Post-ARD Additional Interest,
also will be treated as a Realized Loss.
Some examples of Additional Trust Fund Expenses are:
- any special servicing fees, workout fees and liquidation fees paid to the
special servicer;
- any interest paid to the master servicer, the special servicer and/or the
trustee with respect to unreimbursed advances, which interest payment is
not covered out of late payment charges and Default Interest actually
collected on the pooled mortgage loans;
- the cost of various opinions of counsel required or permitted to be
obtained in connection with the servicing of the pooled mortgage loans
and the administration of the other trust assets;
- any unanticipated, non-mortgage loan specific expenses of the trust,
including--
1. any reimbursements and indemnifications to the trustee, the
certificate administrator and the tax administrator described under
"Description of the Governing Documents--Matters Regarding the
Trustee" in the accompanying prospectus and under "-- The
Certificate Administrator and the Tax Administrator" below,
2. any reimbursements and indemnification to the master servicer, the
special servicer and us described under "Description of the
Governing Documents--Matters Regarding the Master Servicer, the
Special Servicer, the Manager and Us" in the accompanying
prospectus, and
3. any federal, state and local taxes, and tax-related expenses,
payable out of the trust assets, as described under "Federal Income
Tax Consequences--REMICs--Prohibited Transactions Tax and Other
Taxes" in the accompanying prospectus;
- rating agency fees, other than on-going surveillance fees, that cannot be
recovered from the borrower; and
- any amounts expended on behalf of the trust to remediate an adverse
environmental condition at any mortgaged real property securing a
defaulted mortgage loan as described under "Servicing of the Underlying
Mortgage
S-129
<PAGE> 130
Loans--Realization Upon Defaulted Mortgage Loans" in this prospectus supplement.
Additional Trust Fund Expenses, other than special servicing fees, will in
each case be paid out of or, for 12 months following the payment of any
Additional Trust Fund Expense from a source other than Default Interest, be
offset by any Default Interest collected on the mortgage pool prior to the
application of that Default Interest to pay additional servicing compensation to
the master servicer or the special servicer.
ADVANCES OF DELINQUENT MONTHLY DEBT SERVICE PAYMENTS
The master servicer will be required to make, for each payment date, a
total amount of advances of principal and/or interest generally equal to all
monthly debt service payments other than balloon payments, and assumed monthly
debt service payments, in each case net of related master servicing fees and
workout fees, that--
- were due or deemed due, as the case may be, with respect to the pooled
mortgage loans during the related collection period, and
- were not paid by or on behalf of the respective borrowers or otherwise
collected as of the close of business on the last day of the related
collection period.
Notwithstanding the foregoing, if it is determined that an Appraisal
Reduction Amount exists with respect to any mortgage loan in the trust, then the
master servicer will reduce the interest portion, but not the principal portion,
of each monthly debt service advance that it must make with respect to that
mortgage loan during the period that the Appraisal Reduction Amount exists. The
interest portion of any monthly debt service advance required to be made with
respect to any mortgage loan as to which there exists an Appraisal Reduction
Amount, will equal the product of:
- the amount of the interest portion of that advance of monthly debt
service payments that would otherwise be required to be made for the
subject payment date without regard to this sentence and the prior
sentence; multiplied by
- a fraction--
1. the numerator of which is equal to the Stated Principal Balance of
the mortgage loan, net of the Appraisal Reduction Amount, and
2. the denominator of which is equal to the Stated Principal Balance of
the mortgage loan.
With respect to any payment date, the master servicer will be required to
make monthly debt service advances either out of its own funds or, subject to
the replacement as and to the extent provided in the pooling and servicing
agreement, funds held in the master servicer's collection account that are not
required to be paid on the series 2000-C3 certificates on that payment date.
If the master servicer fails to make a required advance and the trustee is
aware of that failure, the trustee will be obligated to make that advance. See
"--The Trustee" below.
S-130
<PAGE> 131
The master servicer and the trustee will each be entitled to recover any
monthly debt service advance made by it, out of its own funds, from collections
on the mortgage loan as to which the advance was made. Neither the master
servicer nor the trustee will be obligated to make any monthly debt service
advance that, in its judgment, would not ultimately be recoverable out of
collections on the related mortgage loan. The trustee will be entitled to
conclusively rely on any determination of non-recoverability made by the master
servicer. If the master servicer or the trustee makes any monthly debt service
advance that it subsequently determines, in its judgment, will not be
recoverable out of collections on the related mortgage loan, it may obtain
reimbursement for that advance, together with interest accrued on the advance as
described in the next paragraph, out of general collections on the mortgage
loans and any REO Properties in the trust on deposit in the master servicer's
collection account from time to time. See "Description of the
Certificates--Advances" in the accompanying prospectus and "Servicing of the
Underlying Mortgage Loans--Collection Account" in this prospectus supplement.
The master servicer and the trustee will each be entitled to receive
interest on monthly debt service advances made by it out of its own funds. That
interest will accrue on the amount of each monthly debt service advance for so
long as that advance is outstanding at an annual rate equal to the prime rate as
published in the "Money Rates" section of The Wall Street Journal, as that prime
rate may change from time to time. Interest accrued with respect to any monthly
debt service advance will be payable--
- first, out of any Default Interest collected on any pooled mortgage loan
subsequent to the accrual of that advance interest up to and including
the date of reimbursement of that monthly debt service advance, and
- then, after the advance has been reimbursed, but only if and to the
extent that the Default Interest referred to in clause first above that
has been collected through the date of that reimbursement has been
insufficient to cover the advance interest, out of any amounts then on
deposit in the master servicer's collection account.
If any payment of interest on advances is paid out of general collections on the
mortgage pool as contemplated by the second bullet of the prior sentence, then
any Default Interest collected during the twelve-month period following that
payment will be applied to reimburse the trust for that payment prior to being
applied as additional compensation to the master servicer or the special
servicer.
Any delay between a sub-servicer's receipt of a late collection of a
monthly debt service payment as to which a monthly debt service advance was made
and the forwarding of that late collection to the master servicer, will increase
the amount of interest accrued and payable to the master servicer or the
trustee, as the case may be, on that monthly debt service advance. To the extent
not offset by Default Interest accrued and actually collected, interest accrued
on outstanding monthly debt service advances will result in a reduction in
amounts payable on the series 2000-C3 certificates.
S-131
<PAGE> 132
A monthly debt service payment will be assumed to be due with respect to:
- each pooled mortgage loan that is delinquent with respect to its balloon
payment beyond the end of the collection period in which its maturity
date occurs and as to which no arrangements have been agreed to for the
collection of the delinquent amounts, including an extension of maturity;
and
- each pooled mortgage loan as to which the corresponding mortgaged real
property has become an REO Property.
The assumed monthly debt service payment deemed due on any mortgage loan
described in the prior sentence that is delinquent as to its balloon payment,
will equal, for its maturity date and for each successive due date that it
remains outstanding and part of the trust, the monthly debt service payment that
would have been due on the mortgage loan on the relevant date if the related
balloon payment had not come due and the mortgage loan had, instead, continued
to amortize and accrue interest according to its terms in effect prior to that
maturity date. The assumed monthly debt service payment deemed due on any
mortgage loan described in the second preceding sentence as to which the related
mortgaged real property has become an REO Property, will equal, for each due
date that the REO Property remains part of the trust, the monthly debt service
payment or, in the case of a mortgage loan delinquent with respect to its
balloon payment, the assumed monthly debt service payment due or deemed due on
the last due date prior to the acquisition of that REO Property. Assumed monthly
debt service payments for ARD Loans do not include Post-ARD Additional Interest
or accelerated amortization payments.
REPORTS TO CERTIFICATEHOLDERS; AVAILABLE INFORMATION
Certificateholder Reports. Based solely on historical information
provided on a one-time basis by the respective mortgage loan sellers and
information provided in monthly reports prepared by the master servicer and the
special servicer, and in any event delivered to the certificate administrator,
the certificate administrator will be required to provide or otherwise make
available as described under "--Information Available Electronically" below, on
each payment date, to each registered holder of an offered certificate and to
each beneficial owner of an offered certificate held in book-entry form that is
identified to the reasonable satisfaction of the certificate administrator--
- a payment date statement substantially in the form of Annex C to this
prospectus supplement, and
- a CMSA collateral summary file, a CMSA bond level file and, to the extent
received by the certificate administrator since the last payment date or
the date of initial issuance of the series 2000-C3 certificates, as
applicable, each other file and report comprising the CMSA Investor
Reporting Package, excluding the CMSA loan set-up file.
Commencing in March 2001, the master servicer or the special servicer, as
specified in the pooling and servicing agreement, is required to deliver to the
certificate administrator monthly a copy of each of the following reports with
respect to the pooled mortgage loans and the corresponding mortgaged real
properties, in each case providing
S-132
<PAGE> 133
the most recent information available as of the end of the most recently ended
collection period:
- a CMSA loan periodic update file;
- a CMSA property file;
- a CMSA financial file;
- a CMSA delinquent loan status report;
- a CMSA historical loan modification report;
- a CMSA historical liquidation report;
- a CMSA REO status report;
- a CMSA comparative financial status report; and
- a CMSA servicer watch list.
Within 60 days after receipt by the master servicer, as to non-specially
serviced mortgage loans in the trust, and within 45 days after receipt by the
special servicer, as to specially serviced mortgage loans and REO Properties in
the trust, of any annual, quarterly, monthly or other periodic operating
statements or rent rolls with respect to any of the mortgaged real properties
and REO Properties relating to the mortgage pool, the master servicer or special
servicer, as applicable, will, based on those operating statements and/or rent
rolls, prepare or, if previously prepared, update an operating statement
analysis report for that property. The special servicer will forward to the
master servicer the operating statement analysis reports prepared and/or updated
by the special servicer, and the master servicer will forward to the certificate
administrator, upon request, all of the operating statement analysis reports
prepared, updated or received by the master servicer.
Each file or report that comprises the CMSA Investor Reporting Package will
be substantially in the form of, and contain the information called for in, the
downloadable form of that file or report available as of the date of the initial
issuance of the series 2000-C3 certificates on the CMSA website, currently
located at "www.cssacmbs.org", or in such other form for the presentation of
that information as may from time to time be recommended by the CMSA for
commercial mortgage-backed securities transactions generally and, insofar as
that other form of presentation contemplates additional information, is
reasonably acceptable to the parties to the pooling and servicing agreement.
Book-Entry Certificates. If you hold your offered certificates in
book-entry form through DTC, you may obtain direct access to the monthly reports
of the certificate administrator as if you were a registered certificateholder,
provided that you deliver a written certification to the certificate
administrator confirming your beneficial ownership in the offered certificates.
Otherwise, until definitive certificates are issued with respect to your offered
certificates, the information contained in those monthly reports will be
available to you only to the extent that it is made available through DTC and
the DTC participants or is available on the certificate administrator's internet
website. Conveyance of notices and other communications by DTC to the DTC
participants, and by the DTC
S-133
<PAGE> 134
participants to beneficial owners of the offered certificates, will be governed
by arrangements among them, subject to any statutory or regulatory requirements
as may be in effect from time to time. We, the master servicer, the special
servicer, the trustee, the certificate administrator, the tax administrator and
the series 2000-C3 certificate registrar are required to recognize as
certificateholders only those persons in whose names the series 2000-C3
certificates are registered on the books and records of the certificate
registrar.
Information Available Electronically. The certificate administrator will
make available each month, to any holder or, subject to the discussion under
"--Reports to Certificateholders; Available Information--Book-Entry
Certificates" above, beneficial owner of offered certificates, the CMSA Investor
Reporting Package via the certificate administrator's internet website. The
internet website will initially be located at www.lnbabs.com.
The master servicer also may make some or all of the reports constituting
the CMSA Investor Reporting Package available via its internet website.
Neither the certificate administrator nor the master servicer will make any
representations or warranties as to the accuracy or completeness of, and each
may attach a reasonable and customary disclaimer to any information made
available by it.
The certificate administrator and the master servicer each may require
registration and the acceptance of a disclaimer in connection with providing
access to its electronic bulletin board and/or internet website. Neither the
certificate administrator nor the master servicer will be liable for the
dissemination of information made in accordance with the pooling and servicing
agreement.
Other Information. The pooling and servicing agreement will obligate the
certificate administrator or, in the case of the items referred to in the last
bullet of this paragraph, the trustee to make available at its offices, upon
reasonable prior written request and during normal business hours, for review by
any holder or beneficial owner of an offered certificate or any person
identified to the certificate administrator or trustee, as applicable, as a
prospective transferee of an offered certificate or any interest in that offered
certificate, originals or copies of, among other things, the following items:
- the pooling and servicing agreement, including exhibits, and any
amendments to the pooling and servicing agreement;
- all monthly reports of the certificate administrator delivered, or
otherwise electronically made available, to series 2000-C3
certificateholders since the date of initial issuance of the offered
certificates;
- all officer's certificates delivered to the trustee or the certificate
administrator by the master servicer and/or the special servicer since
the date of initial issuance of the certificates, as described under
"Servicing of the Underlying Mortgage Loans--Evidence as to Compliance"
in this prospectus supplement;
- all accountant's reports delivered to the trustee or the certificate
administrator with respect to the master servicer and/or the special
servicer since the date of
S-134
<PAGE> 135
initial issuance of the offered certificates, as described under "Servicing
of the Underlying Mortgage Loans--Evidence as to Compliance" in this
prospectus supplement; and
- the mortgage files, including all documents, such as modifications,
waivers and amendments of the pooled mortgage loans, that are to be added
to the mortgage files from time to time.
Copies of any and all of the foregoing items will be available from the
certificate administrator or the trustee, as applicable, upon request. However,
the certificate administrator or the trustee, as applicable, will be permitted
to require payment of a sum sufficient to cover the reasonable costs and
expenses of providing the copies.
The pooling and servicing agreement will also obligate the master servicer
to make available at its offices, upon reasonable written request and during
normal business hours, for review by any holder or beneficial owner of an
offered certificate or any person identified to the master servicer as a
prospective transferee of an offered certificate or any interest in an offered
certificate, originals or copies of, among other things, the following items:
- the most recent inspection report with respect to each mortgaged real
property for a pooled mortgage loan prepared by the master servicer or
the special servicer as described under "Servicing of the Underlying
Mortgage Loans--Inspections; Collection of Operating Information" in this
prospectus supplement;
- the most recent appraisal, if any, with respect to each mortgaged real
property for a pooled mortgage loan obtained by the master servicer or
the special servicer; and
- the most recent quarterly and annual operating statement and rent roll
for each mortgaged real property for a pooled mortgage loan and financial
statements of the related borrower collected by the master servicer or
the special servicer as described under "Servicing of the Underlying
Mortgage Loans--Inspections; Collection of Operating Information" in this
prospectus supplement.
Copies of any and all of the foregoing items will be available from the master
servicer upon request. However, the master servicer will be permitted to require
payment of a sum sufficient to cover the reasonable costs and expenses of
providing the copies.
In connection with providing access to or copies of the items described
above, the certificate administrator, the trustee or the master servicer, as
applicable, may require:
- in the case of a beneficial owner of an offered certificate held in
book-entry form, a written confirmation executed by the requesting person
or entity, in the form attached to the pooling and servicing agreement or
otherwise reasonably acceptable to the party providing the requested
information, generally to the effect that the person or entity is a
beneficial owner of offered certificates and will keep the information
confidential; and
S-135
<PAGE> 136
- in the case of a prospective purchaser of an offered certificate or any
interest in that offered certificate, confirmation executed by the
requesting person or entity, in the form attached to the pooling and
servicing agreement or otherwise reasonably acceptable to the party
providing the requested information, generally to the effect that the
person or entity is a prospective purchaser of offered certificates or an
interest in offered certificates, is requesting the information for use
in evaluating a possible investment in the offered certificates and will
otherwise keep the information confidential.
Registered holders of the offered certificates will be deemed to have
agreed to keep the information described above confidential by the acceptance of
their certificates.
VOTING RIGHTS
The voting rights for the series 2000-C3 certificates will be allocated as
follows:
- 98.0% of the voting rights will be allocated to the class A-1, A-2, B, C,
D, E, F, G, H, J, K, L, M, N and P certificates in proportion to the
respective total principal balances of those classes;
- 2.0% of the voting rights will be allocated to the class X certificates;
and
- 0.0% of the voting rights will be allocated to the class R and Y
certificates.
Voting rights allocated to a class of series 2000-C3 certificateholders
will be allocated among those certificateholders in proportion to their
respective percentage interests in that class.
TERMINATION
The obligations created by the pooling and servicing agreement will
terminate following the earliest of--
1. the final payment or advance on, or other liquidation of, the last
mortgage loan or related REO Property remaining in the trust,
2. the purchase of all of the mortgage loans and REO Properties remaining
in the trust by the master servicer, the special servicer or any single
certificateholder or group of certificateholders of the series 2000-C3
controlling class, in that order of preference, and
3. the exchange by any single holder of all the series 2000-C3 certificates
for all the mortgage loans and each REO Property remaining in the trust.
Written notice of termination of the pooling and servicing agreement will
be given to each series 2000-C3 certificateholder. The final payment with
respect to each series 2000-C3 certificate will be made only upon surrender and
cancellation of that certificate at the office of the series 2000-C3 certificate
registrar or at any other location specified in the notice of termination.
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Any purchase by the master servicer, the special servicer or any single
holder or group of holders of the series 2000-C3 controlling class of all the
mortgage loans and REO Properties remaining in the trust is required to be made
at a price equal to:
- the sum of--
1. the total Stated Principal Balance of all the mortgage loans then
included in the trust, other than any mortgage loans as to which the
mortgaged real properties have become REO Properties, together
with--
(a) all unpaid and unadvanced interest, other than Default
Interest and Post-ARD Additional Interest, on those mortgage
loans up to, but not including their respective due dates in
the related collection period, and
(b) all unreimbursed advances for those mortgage loans, together
with any interest on those advances owing to the parties that
made them, and
2. the appraised value of all REO Properties then included in the
trust, as determined by an appraiser mutually agreed upon by the
master servicer, the special servicer and the trustee; minus
- solely in the case of a purchase by the master servicer or the special
servicer, the total of all amounts payable or reimbursable to the
purchaser under the pooling and servicing agreement.
That purchase will result in early retirement of the then outstanding series
2000-C3 certificates. However, the right of the master servicer, the special
servicer or any single holder or group of holders of the series 2000-C3
controlling class to make the purchase is subject to the requirement that the
total Stated Principal Balance of the mortgage pool be less than 1.0% of the
initial mortgage pool balance. The termination price, exclusive of any portion
of the termination price payable or reimbursable to any person other than the
series 2000-C3 certificateholders, will constitute part of the Available P&I
Funds for the final payment date. Any person or entity making the purchase will
be responsible for reimbursing the parties to the pooling and servicing
agreement for all reasonable out-of-pocket costs and expenses incurred by the
parties in connection with the purchase.
Any exchange by any single holder of all of the series 2000-C3 certificates
for all of the mortgage loans and each REO Property remaining in the trust may
be made by giving written notice to each of the parties to the pooling and
servicing agreement no later than 60 days prior to the anticipated date of
exchange. In the event that any single holder of all the series 2000-C3
certificates elects to exchange those certificates for all of the mortgage loans
and each REO Property remaining in the trust, that holder, no later than the
business day immediately preceding the payment date on which the final payment
on the series 2000-C3 certificates is to occur, must deposit in the master
servicer's collection account immediately available funds in an amount equal to
all amounts then due and owing to the master servicer, the special servicer, the
trustee and their respective agents under the pooling and servicing agreement.
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THE TRUSTEE
Wells Fargo Bank Minnesota, N.A. will act as initial trustee under the
pooling and servicing agreement. Wells Fargo is a direct, wholly owned
subsidiary of Wells Fargo & Company. It is a national banking association
originally chartered in 1872 and is engaged in a wide range of activities
typical of a national bank. Wells Fargo maintains an office at Wells Fargo
Center, Sixth and Marquette, Minneapolis, Minnesota 55479-0113. In addition,
Wells Fargo maintains a CMBS customer service help desk at (301) 815-6600.
The trustee is at all times required to be a corporation, bank, trust
company or association organized and doing business under the laws of the U.S.
or any State of the U.S. or the District of Columbia. In addition, the trustee
must at all times--
- be authorized under those laws to exercise trust powers,
- have a combined capital and surplus of at least $50,000,000, and
- be subject to supervision or examination by federal or state authority.
If the corporation, bank, trust company or association publishes reports of
condition at least annually, in accordance with law or the requirements of the
supervising or examining authority, then the combined capital and surplus of
that corporation, bank, trust company or association will be deemed to be its
combined capital and surplus as described in its most recent published report of
condition.
We, the master servicer, the special servicer and our and their respective
affiliates, may from time to time enter into normal banking and trustee
relationships with the trustee and its affiliates. The trustee and any of its
respective affiliates may hold series 2000-C3 certificates in their own names.
In addition, for purposes of meeting the legal requirements of some local
jurisdictions, the master servicer and the trustee acting jointly will have the
power to appoint a co-trustee or separate trustee of all or any part of the
trust assets. All rights, powers, duties and obligations conferred or imposed
upon the trustee will be conferred or imposed upon the trustee and the separate
trustee or co-trustee jointly, or in any jurisdiction in which the trustee shall
be incompetent or unqualified to perform various acts, singly upon the separate
trustee or co-trustee who shall exercise and perform its rights, powers, duties
and obligations solely at the direction of the trustee.
The trustee will be entitled to a monthly fee for its services. With
respect to each and every pooled mortgage loan, including each specially
serviced mortgage loan, each mortgage loan as to which the related mortgaged
real property has become an REO Property and each mortgage loan that has been
defeased, that fee will accrue on the same interest accrual basis as the related
mortgage loan at a specified rate per annum on the Stated Principal Balance of
the related mortgage loan outstanding from time to time. The trustee fee is
payable out of general collections on the mortgage loans and any REO Properties
in the trust.
See also "Description of the Governing Documents--The Trustee", "--Duties
of the Trustee", "--Matters Regarding the Trustee" and "--Resignation and
Removal of the Trustee" in the accompanying prospectus.
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THE CERTIFICATE ADMINISTRATOR AND THE TAX ADMINISTRATOR
LaSalle Bank National Association, a national banking association, with its
principal offices in Chicago, Illinois, will act as the initial certificate
administrator and tax administrator. LaSalle maintains an office at 135 South
LaSalle Street, Suite 1625, Chicago, Illinois 60603, Attention: Asset Backed
Securities Trust Service Group -- Salomon Brothers 2000-C3.
The certificate administrator and the tax administrator each must at all
times be a corporation, bank, trust company or association organized and doing
business under the laws of the U.S. or any state of the U.S. or the District of
Columbia. In addition, the certificate administrator and the tax administrator
each must at all times --
- have a combined capital and surplus of at least $50,000,000, and
- be subject to supervision or examination by federal or state authority.
If the corporation, bank, trust company or association publishes reports of
condition at least annually, in accordance with applicable law or the
requirements of the supervising or examining authority, then the combined
capital and surplus of that corporation, bank, trust company or association will
be deemed to be its combined capital and surplus as described in its most recent
published report of condition.
The certificate administrator and the tax administrator will be entitled to
the same limitations on liability and indemnities that the trustee is entitled
to as described under "Description of the Governing Documents -- Matters
Regarding the Trustee" in the accompanying prospectus. Furthermore, the
certificate administrator and the tax administrator each will be entitled to
resign, and will be subject to removal, under the same circumstances as the
trustee as described under "Description of the Governing Documents --
Resignation and Removal of the Trustee" in the accompanying prospectus. The fees
of the certificate administrator and the tax administrator will be payable from
a portion of the monthly trustee's fee. The trustee may terminate the
certificate administrator or the tax administrator if it believes such to be in
the best interests of the series 2000-C3 certificateholders.
YIELD AND MATURITY CONSIDERATIONS
YIELD CONSIDERATIONS
General. The yield on any offered certificate will depend on:
- the price at which the certificate is purchased by an investor, and
- the rate, timing and amount of payments on the certificate.
The rate, timing and amount of payments on any offered certificate will in
turn depend on, among other things,
- the pass-through rate for the certificate,
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- the rate and timing of principal payments, including principal
prepayments, and other principal collections on the underlying mortgage
loans and the extent to which those amounts are to be applied or
otherwise result in reduction of the principal balance or notional amount
of the certificate,
- the rate, timing and severity of Realized Losses and Additional Trust
Fund Expenses and the extent to which those losses and expenses result in
the reduction of the principal balance or notional amount of the
certificate, and
- the timing and severity of any Net Aggregate Prepayment Interest
Shortfalls and the extent to which those shortfalls result in the
reduction of the interest payments on the certificate.
Pass-Through Rates. The pass-through rates for the class A-1 and A-2
certificates are, in each case, fixed.
The pass-through rates applicable to the class B, C, D, E and F
certificates will be variable and, in each case, will be calculated based in
part on the Weighted Average Pool Pass-Through Rate from time to time.
Accordingly, the yield on the class B, C, D, E and F certificates will be
sensitive to changes in the relative composition of the mortgage pool as a
result of scheduled amortization, voluntary prepayments and liquidations of
underlying mortgage loans following default.
See "Description of the Offered Certificates--Payments--Calculation of
Pass-Through Rates" and "Description of the Mortgage Pool" in this prospectus
supplement and "--Rate and Timing of Principal Payments" below.
Rate and Timing of Principal Payments. The yield to maturity on offered
certificates purchased at a discount or a premium will be affected by the rate
and timing of principal payments made in reduction of the principal balances of
those certificates. In turn, the rate and timing of principal payments that are
paid in reduction of the principal balance of any offered certificate will be
directly related to the rate and timing of principal payments on or with respect
to the underlying mortgage loans. Finally, the rate and timing of principal
payments on or with respect to the underlying mortgage loans will be affected by
their amortization schedules, the dates on which balloon payments are due and
the rate and timing of principal prepayments and other unscheduled collections
on them, including for this purpose, collections made in connection with
liquidations of mortgage loans due to defaults, casualties or condemnations
affecting the mortgaged real properties, or purchases or other removals of
underlying mortgage loans from the trust.
Prepayments and other early liquidations of the underlying mortgage loans,
including as a result of the purchase of any mortgage loan out of the trust as
described under "Description of the Mortgage Pool--Cures and Repurchases" and
"Description of the Offered Certificates--Termination" in this prospectus
supplement, will result in payments on the series 2000-C3 certificates of
amounts that would otherwise be paid over the remaining terms of the mortgage
loans. This will tend to shorten the weighted average lives of the offered
certificates with principal balances. Defaults on the underlying mortgage loans,
particularly at or near their maturity dates, may result in significant delays
in payments of principal on the mortgage loans and, accordingly, on the
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series 2000-C3 certificates, while work-outs are negotiated or foreclosures are
completed. These delays will tend to lengthen the weighted average lives of the
offered certificates. See "Servicing of the Underlying Mortgage
Loans--Modifications, Waivers, Amendments and Consents" in this prospectus
supplement. In addition, the ability of a borrower under an ARD Loan, to repay
that loan on the related anticipated repayment date will generally depend on its
ability to either refinance the mortgage loan or sell the corresponding
mortgaged real property. Also, a borrower may have little incentive to repay its
mortgage loan on the related anticipated repayment date if then prevailing
interest rates are relatively high. Accordingly, there can be no assurance that
any ARD Loan in the trust will be paid in full on its anticipated repayment
date.
The extent to which the yield to maturity on any offered certificate may
vary from the anticipated yield will depend upon the degree to which the
certificate is purchased at a discount or premium and when, and to what degree,
payments of principal on the underlying mortgage loans are in turn paid in a
reduction of the principal balance of the certificate. Conversely, if you
purchase your offered certificates at a discount, you should consider the risk
that a slower than anticipated rate of principal payments on the underlying
mortgage loans could result in an actual yield to you that is lower than your
anticipated yield. Conversely, if you purchase your offered certificates at a
premium, you should consider the risk that a faster than anticipated rate of
principal payments on the underlying mortgage loans could result in an actual
yield to you that is lower than your anticipated yield.
Because the rate of principal payments on or with respect to the underlying
mortgage loans will depend on future events and a variety of factors, no
assurance can be given as to that rate or the rate of principal prepayments in
particular. We are not aware of any relevant publicly available or authoritative
statistics with respect to the historical prepayment experience of a large group
of real estate loans comparable to those in the mortgage pool.
Even if they are collected and payable on your offered certificates,
prepayment premiums and yield maintenance charges may not be sufficient to
offset fully any loss in yield on your offered certificates attributable to the
related prepayments of the underlying mortgage loans.
Delinquencies and Defaults on the Mortgage Loans. The rate and timing of
delinquencies and defaults on the underlying mortgage loans will affect--
- the amount of payments on your offered certificates,
- the yield to maturity of your offered certificates,
- the rate of principal payments on your offered certificates, and
- the weighted average life of your offered certificates.
Delinquencies on the underlying mortgage loans, unless covered by monthly
debt service advances may result in shortfalls in payments of interest and/or
principal on your offered certificates for the current month.
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If--
- you calculate the anticipated yield to maturity for your offered
certificates based on an assumed rate of default and amount of losses on
the underlying mortgage loans that is lower than the default rate and
amount of losses actually experienced, and
- the additional losses result in a reduction of the total payments on or
the total principal balance of your offered certificates,
then your actual yield to maturity will be lower than you calculated and could,
under some scenarios, be negative.
The timing of any loss on a liquidated mortgage loan that results in a
reduction of the total payments on or the total principal balance of your
offered certificates will also affect your actual yield to maturity, even if the
rate of defaults and severity of losses are consistent with your expectations.
In general, the earlier your loss occurs, the greater the effect on your yield
to maturity.
Even if losses on the underlying mortgage loans do not result in a
reduction of the total payments on or the total principal balance of your
offered certificates, the losses may still affect the timing of payments on, and
the weighted average life and yield to maturity of, your offered certificates.
Relevant Factors. The following factors, among others, will affect the
rate and timing of principal payments and defaults and the severity of losses on
or with respect to the mortgage loans in the trust:
- prevailing interest rates;
- the terms of the mortgage loans, including--
1. provisions that require the payment of prepayment premiums and yield
maintenance charges,
2. provisions that impose prepayment lock-out periods, and
3. amortization terms that result in balloon payments;
- the demographics and relative economic vitality of the areas in which the
mortgaged real properties are located;
- the general supply and demand for commercial and multifamily rental space
of the type available at the mortgaged real properties in the areas in
which those properties are located;
- the quality of management of the mortgaged real properties;
- the servicing of the mortgage loans;
- possible changes in tax laws; and
- other opportunities for investment.
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See "Risk Factors--Risks Related to the Mortgage Loans", "Description of
the Mortgage Pool" and "Servicing of the Underlying Mortgage Loans" in this
prospectus supplement and "Description of the Governing Documents" and "Yield
and Maturity Considerations--Yield and Prepayment Considerations" in the
accompanying prospectus.
The rate of prepayment on the mortgage loans in the trust is likely to be
affected by prevailing market interest rates for mortgage loans of a comparable
type, term and risk level. When the prevailing market interest rate is below the
annual rate at which a mortgage loan accrues interest, the related borrower may
have an increased incentive to refinance the mortgage loan. Conversely, to the
extent prevailing market interest rates exceed the annual rate at which a
mortgage loan accrues interest, the related borrower may be less likely to
voluntarily prepay the mortgage loan. Assuming prevailing market interest rates
exceed the revised mortgage interest rate at which an ARD Loan accrues interest
following its anticipated repayment date, the primary incentive for the related
borrower to prepay the mortgage loan on or before its anticipated repayment date
is to give the borrower access to excess cash flow, all of which, net of the
minimum required debt service, approved property expenses and any required
reserves, must be applied to pay down principal of the mortgage loan.
Accordingly, there can be no assurance that any ARD Loan in the trust will be
prepaid on or before its anticipated repayment date or on any other date prior
to maturity.
Depending on prevailing market interest rates, the outlook for market
interest rates and economic conditions generally, some underlying borrowers may
sell their mortgaged real properties in order to realize their equity in those
properties, to meet cash flow needs or to make other investments. In addition,
some underlying borrowers may be motivated by federal and state tax laws, which
are subject to change, to sell their mortgaged real properties prior to the
exhaustion of tax depreciation benefits.
A number of the underlying borrowers are partnerships. The bankruptcy of
the general partner in a partnership may result in the dissolution of the
partnership. The dissolution of a borrower partnership, the winding-up of its
affairs and the distribution of its assets could result in an acceleration of
its payment obligations under the related mortgage loan.
We make no representation or warranty regarding:
- the particular factors that will affect the rate and timing of
prepayments and defaults on the underlying mortgage loans;
- the relative importance of those factors;
- the percentage of the total principal balance of the underlying mortgage
loans that will be prepaid or as to which a default will have occurred as
of any particular date; or
- the overall rate of prepayment or default on the underlying mortgage
loans.
Unpaid Interest. If the portion of the Available P&I Funds payable with
respect to interest on any class of offered certificates on any payment date is
less than the total amount of interest then payable for the class, the shortfall
will be payable to the holders
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of those certificates on subsequent payment dates, subject to the Available P&I
Funds on those subsequent payment dates and the priority of payments described
under "Description of the Offered Certificates--Payments--Priority of Payments"
in this prospectus supplement. That shortfall will not bear interest, however,
and will therefore negatively affect the yield to maturity of that class of
offered certificates for so long as it is outstanding.
Delay in Payments. Because monthly payments will not be made on the
offered certificates until several days after the due dates for the underlying
mortgage loans during the related collection period, your effective yield will
be lower than the yield that would otherwise be produced by your pass-through
rate and purchase price, assuming that purchase price did not account for a
delay.
WEIGHTED AVERAGE LIVES OF THE OFFERED CERTIFICATES
The tables set forth on Annex B to this prospectus supplement--
- indicate the respective weighted average lives of the various classes of
the offered certificates, and
- set forth the percentages of the respective initial total principal
balances of the various classes of the offered certificates that would be
outstanding after the payment dates in each of the calendar months shown.
Those tables were prepared based on the Maturity Assumptions and the
indicated prepayment scenarios.
For purposes of this prospectus supplement, weighted average life refers to
the average amount of time that will elapse from the date of issuance of a
security until each dollar of principal of the security will be repaid to the
investor, assuming no losses. For purposes of this "Yield and Maturity
Considerations" section and Annex B, the weighted average life of any offered
certificate is determined by:
1. multiplying the amount of each principal payment on the certificate by
the number of years from the assumed settlement date, which is part of
the Maturity Assumptions, to the related payment date;
2. summing the results; and
3. dividing the sum by the total amount of the reductions in the principal
balance of the certificate.
The weighted average life of any offered certificate will be influenced by,
among other things, the rate at which the principal of the pooled mortgage loans
is paid, which may be in the form of scheduled amortization, balloon payments,
prepayments, liquidation proceeds, condemnation proceeds or insurance proceeds.
The weighted average life of any offered certificate may also be affected to the
extent that additional payments in reduction of the principal balance of that
certificate occur as a result of the purchase of a pooled mortgage loan from the
trust or the optional termination of the trust. The purchase of a pooled
mortgage loan from the trust will have the same effect
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on payments to the offered certificateholders as if the pooled mortgage loan had
prepaid in full, except that no prepayment fee is collectable on the pooled
mortgage loans.
The actual characteristics and performance of the pooled mortgage loans
will differ from the assumptions used in calculating the tables on Annex B.
Those tables are hypothetical in nature and are provided only to give a general
sense of how the principal cash flows might behave under the assumed prepayment
scenarios. Any difference between the assumptions used in calculating the tables
on Annex B and the actual characteristics and performance of the pooled mortgage
loans, or actual prepayment or loss experience, will affect the percentages of
initial total principal balances outstanding over time and the weighted average
lives of the respective classes of the offered certificates. It is highly
unlikely that the pooled mortgage loans will prepay in accordance with the
Maturity Assumptions at any of the specified CPRs until maturity or that all the
pooled mortgage loans will so prepay at the same rate. In addition, variations
in the actual prepayment experience and the balance of the pooled mortgage loans
that prepay may increase or decrease the percentages of initial principal
balances and weighted average lives shown in the tables. Variations may occur
even if the average prepayment experience of the pooled mortgage loans were to
conform to the assumptions and be equal to any of the specified CPRs. You must
make your own decisions as to the appropriate prepayment, liquidation and loss
assumptions to be used in deciding whether to purchase any offered certificate.
We make no representation that--
- the mortgage loans in the trust will prepay in accordance with the
assumptions set forth in this prospectus supplement at any of the CPRs
shown or at any other particular prepayment rate,
- all the mortgage loans in the trust will prepay in accordance with the
assumptions set forth in this prospectus supplement at the same rate,
- mortgage loans in the trust that are in a lockout period, a yield
maintenance period or declining premium period will not prepay as a
result of involuntary liquidations upon default or otherwise, or
- mortgage loans in the trust will not experience defaults and losses.
USE OF PROCEEDS
Substantially all of the proceeds from the sale of the offered certificates
will be used by us to purchase the mortgage loans that we will include in the
trust and to pay those expenses incurred in connection with the issuance of the
series 2000-C3 certificates.
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FEDERAL INCOME TAX CONSEQUENCES
GENERAL
Upon the initial issuance of the offered certificates, Sidley & Austin, our
counsel, will deliver its opinion generally to the effect that, assuming
compliance with the pooling and servicing agreement, and subject to any other
assumptions set forth in the opinion, REMIC I, REMIC II and REMIC III,
respectively, will each qualify as a REMIC under the Internal Revenue Code of
1986.
Except as otherwise described in the next sentence, the assets of REMIC I
will generally include--
- the pooled mortgage loans,
- any REO Properties acquired on behalf of the series 2000-C3
certificateholders,
- the master servicer's collection account,
- the special servicer's REO account, and
- the payment account and interest reserve account maintained by the
certificate administrator in the name of the trustee,
but will exclude any collections of Post-ARD Additional Interest on the ARD
Loans. Certain mortgage loans constitute the sole asset of a separate REMIC, and
the regular interest in each of those single loan REMICs will be an asset of
REMIC I instead of the particular mortgage loan or any related REO Property.
For federal income tax purposes,
- the separate non-certificated regular interests in REMIC I will be the
regular interests in REMIC I and will be the assets of REMIC II,
- the separate non-certificated regular interests in REMIC II will be the
regular interests in REMIC II and will be the assets of REMIC III,
- the class A-1, A-2, X, B, C, D, E, F, G, H, J, K, L, M, N and P
certificates will evidence the regular interests in, and will generally
be treated as debt obligations of, REMIC III,
- the class R certificates will evidence the sole class of residual
interests in each of REMIC I, REMIC II and REMIC III and in each of the
single loan REMICs, and
- the class Y certificates will evidence 100% of the beneficial ownership
of the grantor trust consisting of any Post-ARD Additional Interest
collected on the ARD Loans.
DISCOUNT AND PREMIUM; PREPAYMENT CONSIDERATION
For federal income tax reporting purposes, it is anticipated that none of
the offered certificates will be issued with more than a de minimis amount of
original issue discount.
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When determining the rate of accrual of market discount and premium, if
any, for federal income tax reporting purposes the prepayment assumption used
will be that, subsequent to the date of any determination:
- the ARD Loans in the trust will be paid in full on their respective
anticipated repayment dates,
- no mortgage loan in the trust will otherwise be prepaid prior to
maturity,
- there will be no extension of maturity for any mortgage loan in the
trust, and
- no mortgage loan is purchased out of or otherwise removed from the trust
for any reason.
However, no representation is made as to the actual rate at which the pooled
mortgage loans will prepay, if at all. See "Federal Income Tax
Consequences--REMICs--Taxation of Owners of REMIC Regular Certificates" in the
accompanying prospectus.
The IRS has issued regulations under Sections 1271 to 1275 of the Internal
Revenue Code of 1986 generally addressing the treatment of debt instruments
issued with original issue discount. You should be aware, however, that those
regulations and Section 1272(a)(6) of the Internal Revenue Code of 1986 do not
adequately address all issues relevant to, or are not applicable to, prepayable
securities such as the offered certificates. We recommend that you consult with
your own tax advisor concerning the tax treatment of your offered certificates.
If the method for computing original issue discount described in the
accompanying prospectus results in a negative amount for any period with respect
to any holder of offered certificates, the amount of original issue discount
allocable to that period would be zero. The holder would be permitted to offset
the negative amount only against future original issue discount, if any,
attributable to his or her certificates.
Some classes of the offered certificates may be treated for federal income
tax purposes as having been issued at a premium. Whether any holder of these
classes of offered certificates will be treated as holding a certificate with
amortizable bond premium will depend on the certificateholder's purchase price
and the payments remaining to be made on the certificate at the time of its
acquisition by the certificateholder. If you acquire an interest in any class of
offered certificates issued at a premium, you should consider consulting your
own tax advisor regarding the possibility of making an election to amortize the
premium. See "Federal Income Tax Consequences--REMICs--Taxation of Owners of
REMIC Regular Certificates--Premium" in the accompanying prospectus.
Prepayment premiums and yield maintenance charges actually collected on the
underlying mortgage loans will be paid on the offered certificates as and to the
extent described in this prospectus supplement. It is not entirely clear under
the Code when the amount of a prepayment premium or yield maintenance charge
should be taxed to the holder of a class of offered certificates entitled to
that amount. For federal income tax reporting purposes, the tax administrator
will report prepayment premiums or yield maintenance charges as income to the
holders of a class of offered certificates entitled thereto only after the
master servicer's actual receipt of those amounts. The IRS may
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nevertheless seek to require that an assumed amount of prepayment premiums and
yield maintenance charges be included in payments projected to be made on the
offered certificates and that taxable income be reported based on the projected
constant yield to maturity of the offered certificates. Therefore, the projected
prepayment premiums and yield maintenance charges would be included prior to
their actual receipt by holders of the offered certificates. If the projected
prepayment premiums and yield maintenance charges were not actually received,
presumably the holder of an offered certificate would be allowed to claim a
deduction or reduction in gross income at the time the unpaid prepayment
premiums and yield maintenance charges had been projected to be received.
Moreover, it appears that prepayment premiums and yield maintenance charges are
to be treated as ordinary income rather than capital gain. However, the correct
characterization of the income is not entirely clear. We recommend you consult
your own tax advisors concerning the treatment of prepayment premiums and yield
maintenance charges.
CHARACTERIZATION OF INVESTMENTS IN OFFERED CERTIFICATES
Except to the extent noted below, the offered certificates will be "real
estate assets" within the meaning of Section 856(c)(5)(B) of the Internal
Revenue Code of 1986 in the same proportion that the assets of the trust would
be so treated. In addition, interest, including original issue discount, if any,
on the offered certificates will be interest described in Section 856(c)(3)(B)
of the Internal Revenue Code of 1986 to the extent that those certificates are
treated as "real estate assets" within the meaning of Section 856(c)(5)(B) of
the Internal Revenue Code of 1986.
Most of the mortgage loans to be included in the trust are not secured by
real estate used for residential or other purposes prescribed in Section
7701(a)(19)(C) of the Internal Revenue Code of 1986. Consequently, the offered
certificates will be treated as assets qualifying under that section to only a
limited extent. Accordingly, investment in the offered certificates may not be
suitable for a thrift institution seeking to be treated as a "domestic building
and loan association" under Section 7701(a)(19)(C) of the Internal Revenue Code
of 1986. The offered certificates will be treated as--
- "qualified mortgages" for another REMIC under Section 860G(a)(3)(C) of
the Internal Revenue Code of 1986, and
- "permitted assets" for a "financial asset securitization investment
trust" under Section 860L(c) of the Internal Revenue Code of 1986.
To the extent an offered certificate represents ownership of an interest in
a mortgage loan that is secured in part by the related borrower's interest in a
bank account, that mortgage loan is not secured solely by real estate.
Therefore:
- a portion of that certificate may not represent ownership of "loans
secured by an interest in real property" or other assets described in
Section 7701(a)(19)(C) of the Internal Revenue Code of 1986;
- a portion of that certificate may not represent ownership of "real estate
assets" under Section 856(c)(5)(B) of the Internal Revenue Code of 1986;
and
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- the interest on that certificate may not constitute "interest on
obligations secured by mortgages on real property" within the meaning of
Section 856(c)(3)(B) of the Internal Revenue Code of 1986.
In addition, most of the mortgage loans that we intend to include in the
trust contain defeasance provisions under which the lender may release its lien
on the collateral securing the mortgage loan in return for the borrower's pledge
of substitute collateral in the form of government securities. Generally, under
the Treasury regulations, if a REMIC releases its lien on real property that
secures a qualified mortgage, that mortgage ceases to be a qualified mortgage on
the date the lien is released unless certain conditions are satisfied. In order
for the mortgage loan to remain a qualified mortgage, the Treasury regulations
require that--
(1) the borrower pledges substitute collateral that consist solely of
certain government securities;
(2) the mortgage loan documents allow that substitution;
(3) the lien is released to facilitate the disposition of the property or
any other customary commercial transaction, and not as part of an
arrangement to collateralize a REMIC offering with obligations that are
not real estate mortgages; and
(4) the release is not within two years of the startup day of the REMIC.
Following the defeasance of a mortgage loan, regardless of whether the foregoing
conditions were satisfied, that mortgage loan would not be treated as a "loan
secured by an interest in real property" or a "real estate asset" and interest
on that loan would not constitute "interest on obligations secured by real
property" for purposes of Sections 7701(a)(19)(C), 856(c)(5)(B) and 856(c)(3)(B)
of the Internal Revenue Code of 1986, respectively.
See "Description of the Mortgage Pool" in this prospectus supplement and
"Federal Income Tax Consequences--REMICs--Characterization of Investments in
REMIC Certificates" in the accompanying prospectus.
TAX CONSIDERATIONS ASSOCIATED WITH MORTGAGED REAL PROPERTIES LOCATED IN PUERTO
RICO
One mortgaged real property, securing 1.22% of the initial mortgage pool
balance, is located in Puerto Rico. If the trust acquires a real property
located in Puerto Rico, it would be subject to Puerto Rican taxation with
respect to the income derived from that real property. If the activities of the
trust in Puerto Rico in relation to such real property constituted a trade or
business, the trust would be subject to income tax at up to a 39% rate with
respect to its net income attributable to the operation of that real property,
as well as a tax on any gain derived from the sale of the property. In the case
of gain from the sale of real property used in a trade or business, in general,
tax would be imposed at a 25% rate if that real property were held as a capital
asset for more than six months. If the activities of the trust did not
constitute the conduct of a trade or business in Puerto Rico, income derived
from the real property, such as rental payments, would be subject to Puerto
Rican
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withholding tax at a 29% rate. In addition, any gain on the sale of the property
would be subject to tax at a 29% rate, and such tax may be collected through
withholding.
Additionally, it is possible that a Puerto Rican withholding tax may be
imposed at a rate of 29% on interest payments received by the REMIC on a
mortgage loan secured by a mortgaged real property located in Puerto Rico if a
certificateholder owns more than 50% of the related borrower. In that case, the
certificate administrator will make reasonable efforts to cause the withholding
tax imposed on the REMIC to be specially allocated to the certificateholder
owning more than 50% of the related borrower, with the amount of tax treated as
distributed to that certificateholder. The certificateholder would not be
entitled to claim foreign tax credits for federal income tax purposes with
respect to any Puerto Rican withholding tax imposed on the REMIC. Accordingly,
investment in the offered certificates may not be a suitable investment if you
own more than 50% of a borrower under a mortgage loan secured by a mortgaged
real property in Puerto Rico. If the subject withholding tax cannot be specially
allocated to that certificateholder, that tax would constitute an Additional
Trust Fund Expense.
For further information regarding the federal income tax consequences of
investing in the offered certificates, see "Federal Income Tax
Consequences--REMICs" in the accompanying prospectus.
ERISA CONSIDERATIONS
The Employee Retirement Income Security Act of 1974, as amended and the
Internal Revenue Code of 1986 impose various requirements on--
- ERISA Plans, and
- persons that are fiduciaries with respect to ERISA Plans,
in connection with the investment of the assets of an ERISA Plan. For purposes
of this discussion, ERISA Plans may include individual retirement accounts and
annuities, Keogh plans and collective investment funds and separate accounts,
including as applicable, insurance company general accounts, in which other
ERISA Plans are invested.
A fiduciary of any ERISA Plan should carefully review with its legal
advisors whether the purchase or holding of offered certificates could be or
give rise to a transaction that is prohibited or is not otherwise permitted
either under ERISA or Section 4975 of the Internal Revenue Code of 1986 or
whether there exists any statutory or administrative exemption applicable
thereto. Some fiduciary and prohibited transaction issues arise only if the
assets of the trust are "plan assets" for purposes of Part 4 of Title I of ERISA
and Section 4975 of the Internal Revenue Code of 1986. Whether the assets of the
trust will be plan assets at any time will depend on a number of factors,
including the portion of any class of series 2000-C3 certificates that is held
by benefit plan investors as defined in U.S. Department of Labor Regulation
Section 2510.3-101.
The U.S. Department of Labor has issued an individual prohibited
transaction exemption to Smith Barney Inc., a predecessor in interest to Salomon
Smith Barney
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Inc., one of the underwriters, identified as Prohibited Transaction Exemption
91-23. Since it was originally issued, PTE 91-23 has been amended by PTE 97-34
and PTE 2000-58.
Subject to the satisfaction of the conditions set forth in that prohibited
transaction exemption, PTE 91-23 generally exempts from the application of the
prohibited transaction provisions of Sections 406(a) and (b) and 407(a) of
ERISA, and the excise taxes imposed on these prohibited transactions under
Sections 4975(a) and (b) of the Internal Revenue Code of 1986, specified
transactions relating to, among other things--
- the servicing and operation of pools of real estate loans, such as the
mortgage pool, and
- the purchase, sale and holding of mortgage pass-through certificates,
such as the offered certificates, that are underwritten by an
Exemption-Favored Party.
PTE 91-23 sets forth five general conditions which must be satisfied for a
transaction involving the purchase, sale and holding of an offered certificate
to be eligible for exemptive relief under that exemption. The conditions are as
follows:
- first, the acquisition of the certificate by a plan must be on terms that
are at least as favorable to the ERISA Plan as they would be in an
arm's-length transaction with an unrelated party;
- second, at the time of its acquisition by the plan, that certificate must
be rated in one of the four highest generic rating categories by Moody's,
S&P or Fitch, Inc;
- third, the trustee cannot be an affiliate of any other member of the
Restricted Group;
- fourth, the following must be true--
1. the sum of all payments made to and retained by Exemption-Favored
Parties must represent not more than reasonable compensation for
underwriting the relevant class of certificates,
2. the sum of all payments made to and retained by us in connection
with the assignment of the underlying mortgage loans to the trust
must represent not more than the fair market value of the
obligations, and
3. the sum of all payments made to and retained by the master servicer,
the special servicer and any sub-servicer must represent not more
than reasonable compensation for that person's services under the
pooling and servicing agreement and reimbursement of that person's
reasonable expenses in connection therewith; and
- fifth, the investing ERISA Plan must be an accredited investor as defined
in Rule 501(a)(1) of Regulation D under the Securities Act of 1933, as
amended.
It is a condition of their issuance that each class of the offered
certificates be rated at least investment grade by Moody's and S&P. In addition,
the initial trustee is not an affiliate of any other member of the Restricted
Group. Accordingly, as of the date of
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initial issuance of the offered certificates, the second and third general
conditions set forth above will be satisfied with respect to the offered
certificates. A fiduciary of an ERISA Plan contemplating the purchase of an
offered certificate in the secondary market must make its own determination
that, at the time of the purchase, the certificate continues to satisfy the
second and third general conditions set forth above. A fiduciary of an ERISA
Plan contemplating the purchase of an offered certificate, whether in the
initial issuance of the certificate or in the secondary market, must make its
own determination that the first and fourth general conditions set forth above
will be satisfied with respect to the certificate as of the date of the
purchase. An ERISA Plan's authorizing fiduciary will be deemed to make a
representation regarding satisfaction of the fifth general condition set forth
above in connection with the purchase of an offered certificate.
PTE 91-23 also requires that the trust meet the following requirements:
- the trust assets must consist solely of assets of the type that have been
included in other investment pools;
- certificates evidencing interests in those other investment pools must
have been rated in one of the three highest generic categories of
Moody's, S&P or Fitch for at least one year prior to the ERISA Plan's
acquisition of an offered certificate; and
- certificates evidencing interests in those other investment pools must
have been purchased by investors other than ERISA Plans for at least one
year prior to any ERISA Plan's acquisition of an offered certificate.
We believe that these requirements have been satisfied as of the date of
this prospectus supplement.
If the general conditions of PTE 91-23 are satisfied, PTE 91-23 may provide
an exemption from the restrictions imposed by Sections 406(a) and 407(a) of
ERISA, as well as the excise taxes imposed by Sections 4975(a) and (b) of the
Internal Revenue Code of 1986 by reason of Sections 4975(c)(1)(A) through (D) of
the Internal Revenue Code of 1986, in connection with--
- the direct or indirect sale, exchange or transfer of offered certificates
acquired by an ERISA Plan upon initial issuance from us or an
Exemption-Favored Party when we are, or a mortgage loan seller, the
trustee, the master servicer, the special servicer or any sub-servicer,
provider of credit support, Exemption-Favored Party or mortgagor is, a
Party in Interest with respect to the investing ERISA Plan,
- the direct or indirect acquisition or disposition in the secondary market
of offered certificates by an ERISA Plan, and
- the continued holding of offered certificates by an ERISA Plan.
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However, no exemption is provided from the restrictions of Sections
406(a)(1)(E), 406(a)(2) and 407 of ERISA for the acquisition or holding of an
offered certificate that is--
1. on behalf of an ERISA Plan sponsored by any member of the Restricted
Group, and
2. by any person who has discretionary authority or renders investment
advice with respect to the assets of that ERISA Plan.
Moreover, if the general conditions of PTE 91-23, as well as other
conditions set forth in PTE 91-23, are satisfied, PTE 91-23 may also provide an
exemption from the restrictions imposed by Sections 406(b)(1) and (b)(2) of
ERISA and the taxes imposed by Section 4975(c)(1)(E) of the Internal Revenue
Code of 1986 in connection with:
- the direct or indirect sale, exchange or transfer of offered certificates
in the initial issuance of those certificates between us or an
Exemption-Favored Party and an ERISA Plan when the person who has
discretionary authority or renders investment advice with respect to the
investment of the assets of the ERISA Plan in those certificates is--
1. a borrower with respect to 5.0% or less of the fair market value of
the underlying mortgage loans, or
2. an affiliate of that borrower;
- the direct or indirect acquisition or disposition in the secondary market
of offered certificates by an ERISA Plan; and
- the continued holding of offered certificates by an ERISA Plan.
Further, if the general conditions of PTE 91-23, as well as other
conditions set forth in PTE 91-23, are satisfied, PTE 91-23 may provide an
exemption from the restrictions imposed by Sections 406(a), 406(b) and 407(a) of
ERISA, and the taxes imposed by Sections 4975(a) and (b) of the Internal Revenue
Code of 1986 by reason of Section 4975(c) of the Internal Revenue Code of 1986,
for transactions in connection with the servicing, management and operation of
the trust assets.
Lastly, if the general conditions of PTE 91-23 are satisfied, PTE 91-23
also may provide an exemption from the restrictions imposed by Sections 406(a)
and 407(a) of ERISA, and the taxes imposed by Section 4975(a) and (b) of the
Internal Revenue Code of 1986, by reason of Sections 4975(c)(1)(A) through (D)
of the Internal Revenue Code of 1986, if the restrictions are deemed to
otherwise apply merely because a person is deemed to be a Party in Interest with
respect to an investing plan by virtue of--
- providing services to the ERISA Plan, or
- having a specified relationship to this person,
solely as a result of the ERISA Plan's ownership of offered certificates.
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Before purchasing an offered certificate, a fiduciary of an ERISA Plan
should itself confirm that:
- an offered certificates are "certificates" for purposes of PTE 91-23, and
- the general and other conditions set forth in PTE 91-23 and the other
requirements set forth in PTE 91-23 would be satisfied at the time of the
purchase.
In addition to determining the availability of the exemptive relief
provided in PTE 91-23, a fiduciary of an ERISA Plan considering an investment in
the offered certificates should consider the availability of any other
prohibited transaction class exemptions. See "ERISA Considerations" in the
accompanying prospectus. There can be no assurance that any class exemption will
apply with respect to any particular investment by an ERISA Plan in the offered
certificates or, even if it were deemed to apply, that it would apply to all
prohibited transactions that may occur in connection with the investment. A
purchaser of offered certificates should be aware, however, that even if the
conditions specified in one or more class exemptions are satisfied, the scope of
relief provided by a class exemption may not cover all acts which might be
construed as prohibited transactions.
A governmental plan as defined in Section 3(32) of ERISA is not subject to
Title I of ERISA or Section 4975 of the Internal Revenue Code of 1986. However,
a governmental plan may be subject to a federal, state or local law which is, to
a material extent, similar to the foregoing provisions of ERISA or the Internal
Revenue Code of 1986. A fiduciary of a governmental plan should make its own
determination as to the need for and the availability of any exemptive relief
under any similar law.
Any fiduciary of an ERISA Plan considering whether to purchase an offered
certificate on behalf of that ERISA Plan should consult with its counsel
regarding the applicability of the fiduciary responsibility and prohibited
transaction provisions of ERISA and the Internal Revenue Code of 1986 to the
investment.
The sale of offered certificates to an ERISA Plan is in no way a
representation or warranty by us or any of the underwriters that--
- the investment meets all relevant legal requirements with respect to
investments by ERISA Plans generally or by any particular ERISA Plan, or
- the investment is appropriate for ERISA Plans generally or for any
particular ERISA Plan.
LEGAL INVESTMENT
The offered certificates will not be mortgage related securities for
purposes of SMMEA. As a result, the appropriate characterization of the offered
certificates under various legal investment restrictions, and thus the ability
of investors subject to these restrictions to purchase those certificates, is
subject to significant interpretive uncertainties.
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Neither we nor any of the underwriters makes any representation as to the
ability of particular investors to purchase the offered certificates under
applicable legal investment or other restrictions. All institutions whose
investment activities are subject to legal investment laws and regulations,
regulatory capital requirements or review by regulatory authorities should
consult with their own legal advisors in determining whether and to what extent
the offered certificates--
- are legal investments for them, or
- are subject to investment, capital or other restrictions.
In addition, you should take into consideration the applicability of
statutes, rules, regulations, orders, guidelines or agreements generally
governing investments made by a particular investor, including, but not limited
to--
- prudent investor provisions,
- percentage-of-assets limits, and
- provisions which may restrict or prohibit investment in securities which
are not interest bearing or income paying.
There may be other restrictions on the ability of investors, including
depository institutions, either to purchase offered certificates or to purchase
offered certificates representing more than a specified percentage of the
investor's assets. Investors should consult their own legal advisors in
determining whether and to what extent the offered certificates are legal
investments for the investors.
See "Legal Investment" in the accompanying prospectus.
METHOD OF DISTRIBUTION
Subject to the terms and conditions of an underwriting agreement dated
December 12, 2000, between us and the underwriters, the underwriters will
purchase from us, upon initial issuance, their respective allocations, as
specified below, of the offered certificates. It is expected that delivery of
the offered certificates will be made to the underwriters in book-entry form
through the same day funds settlement system of DTC on or about December 19,
2000, against payment therefor in immediately available funds. Proceeds to us
from the sale of the offered certificates, before deducting expenses payable by
us, will be approximately 99.05% of the initial total principal balance of the
offered certificates, plus accrued interest on all the offered certificates from
December 1, 2000.
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<TABLE>
<CAPTION>
UNDERWRITER CLASS A-1 CLASS A-2 CLASS B CLASS C CLASS D CLASS E CLASS F
----------- --------- --------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Salomon Smith Barney Inc. ...... 63% 46% 63% 63% 63% 63% 63%
Greenwich Capital Markets,
Inc. ......................... 37% 37% 37% 37% 37% 37% 37%
Chase Securities Inc. .......... 0% 5% 0% 0% 0% 0% 0%
Deutsche Bank Securities
Inc. ......................... 0% 5% 0% 0% 0% 0% 0%
J.P. Morgan Securities Inc. .... 0% 5% 0% 0% 0% 0% 0%
ABN AMRO Bank N.V. ............. 0% 2% 0% 0% 0% 0% 0%
--- --- --- --- --- --- ---
Total...................... 100% 100% 100% 100% 100% 100% 100%
</TABLE>
With respect to this offering--
- Salomon Smith Barney Inc. will act as lead manager, and
- Greenwich Capital Markets, Inc., ABN AMRO Bank N.V., Chase Securities
Inc., Deutsche Bank Securities Inc. and J.P. Morgan Securities Inc., will
act as co-managers.
Distribution of the offered certificates will be made by the underwriters
from time to time in negotiated transactions or otherwise at varying prices to
be determined at the time of sale. In the case of each underwriter, any profit
on the resale of the offered certificates positioned by it may be deemed to be
underwriting discounts and commissions under the Securities Act of 1933.
The underwriters may sell the offered certificates to or through dealers,
and those dealers may receive compensation in the form of underwriting
discounts, concessions or commissions from the underwriters. Depending on the
facts and circumstances of the purchases, purchasers of the offered
certificates, including dealers, may be deemed to be "underwriters" within the
meaning of the Securities Act in connection with reoffers and sales by them of
offered certificates. Accordingly, any profit on the resale of the offered
certificates positioned by them may be deemed to be underwriting discounts and
commissions under the Securities Act. Holders of offered certificates should
consult with their legal advisors in this regard prior to any reoffer or sale of
those certificates.
Each underwriter has advised us that it presently intends to make a market
in the offered certificates, but it has no obligation to do so. Any market
making may be discontinued at any time, and there can be no assurance that an
active public market for the offered certificates will develop.
ABN AMRO Bank N.V. is not registered as a broker/dealer in the United
States. Accordingly, it can distribute, and make a market in, the offered
securities only outside the United States.
We have agreed to indemnify each underwriter and each person, if any, who
controls that underwriter within the meaning of Section 15 of the Securities Act
against, or make contributions to the underwriters and each of those controlling
persons with respect to, various liabilities, including specific liabilities
under the Securities Act. Each of the mortgage loan sellers has agreed to
indemnify us, our officers and directors, the underwriters, and each person, if
any, who controls us or any underwriter within the meaning of Section 15 of the
Securities Act, with respect to liabilities, including specific
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liabilities under the Securities Act, relating to the mortgage loans being sold
by the particular mortgage loan seller for inclusion in the trust.
The underwriters may engage in transactions that maintain or otherwise
affect the price of the offered certificates, including short-covering
transactions in such offered certificates, and the imposition of a penalty bid,
in connection with the offering. These activities may cause the price of the
offered certificates to be higher than the price that would exist in the open
market absent these activities, and these activities may be discontinued at any
time.
This prospectus supplement may only be issued or passed on in the United
Kingdom to a person who is of a kind described in article 11(3) of the Financial
Services Act 1986 (Investment Advertisements) (Exemptions) Order 1995 or is a
person to whom this prospectus supplement may otherwise lawfully be issued or
passed on.
The trust described in this prospectus supplement may only be promoted,
whether by the issuing or passing on of documents as referred to in the
foregoing restriction or otherwise, by an authorized person under Chapter III of
the Financial Services Act 1986 of the United Kingdom to a person in the United
Kingdom if that person is of a kind described in section 76(2) of that Act or as
permitted by the Financial Services (Promotion of Unregulated Schemes)
Regulations 1991, as amended.
Salomon Smith Barney Inc., the lead manager, is one of our affiliates.
LEGAL MATTERS
Particular legal matters relating to the offered certificates will be
passed upon for us and the underwriters by Sidley & Austin, New York, New York.
RATINGS
It is a condition to their issuance that the respective classes of offered
certificates be rated as follows:
<TABLE>
<CAPTION>
CLASS MOODY'S S&P
----- -------- --------
<S> <C> <C>
Class A-1.............................. Aaa AAA
Class A-2.............................. Aaa AAA
Class B................................ Aa2 AA
Class C................................ A2 A
Class D................................ A3 A-
Class E................................ Baa1 BBB+
Class F................................ Baa2 BBB
</TABLE>
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The ratings on the offered certificates address the likelihood of--
- the timely receipt by their holders of all payments of interest to which
they are entitled on each payment date, and
- the ultimate receipt by their holders of all payments of principal to
which they are entitled on or before the rated final payment date.
The ratings on respective classes of offered certificates take into
consideration--
- the credit quality of the mortgage pool,
- structural and legal aspects associated with the offered certificates,
and
- the extent to which the payment stream from the mortgage pool is adequate
to make payments of interest and/or principal required under the offered
certificates.
The ratings on the respective classes of offered certificates do not
represent any assessment of--
- the tax attributes of the offered certificates or of the trust,
- whether or to what extent prepayments of principal may be received on the
underlying mortgage loans,
- the likelihood or frequency of prepayments of principal on the underlying
mortgage loans,
- the yield to maturity that investors may experience,
- the degree to which the amount or frequency of prepayments of principal
on the underlying mortgage loans might differ from those originally
anticipated,
- whether or to what extent the interest payable on any class of offered
certificates may be reduced in connection with Net Aggregate Prepayment
Interest Shortfalls, and
- whether and to what extent prepayment premiums, yield maintenance
charges, Default Interest or Post-ARD Additional Interest will be
received.
There can be no assurance as to whether any rating agency not requested to
rate the offered certificates will nonetheless issue a rating to any class of
offered certificates and, if so, what the rating would be. A rating assigned to
any class of offered certificates by a rating agency that has not been requested
by us to do so may be lower than the rating assigned to that class by Moody's or
S&P.
The ratings on the offered certificates should be evaluated independently
from similar ratings on other types of securities. A security rating is not a
recommendation to buy, sell or hold securities and may be subject to revision or
withdrawal at any time by the assigning rating organization. Each security
rating should be evaluated independently of any other security rating. See
"Rating" in the accompanying prospectus.
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GLOSSARY
The following capitalized terms will have the respective meanings assigned
to them in this "Glossary" section whenever they are used in this prospectus
supplement, including in any of the annexes to this prospectus supplement or on
the accompanying diskette.
"Additional Trust Fund Expense" means an expense of the trust that--
- arises out of a default on a mortgage loan or an otherwise unanticipated
event,
- is not included in the calculation of a Realized Loss, and
- is not covered by a servicing advance or a corresponding collection from
the related borrower or another party other than the trust, which other
party has no recourse to the trust for reimbursement.
We provide some examples of Additional Trust Fund Expenses under
"Description of the Offered Certificates--Reductions to Certificate Principal
Balances in Connection with Realized Losses and Additional Trust Expenses" in
this prospectus supplement.
"Administrative Fee Rate" means, for any mortgage loan in the trust, the
sum of the master servicing fee rate, plus the per annum rate applicable to the
calculation of the trustee fee. The master servicing fee rate will include any
primary servicing fee rate.
"Allocated Cut-off Date Principal Balance" means, with respect to any
mortgaged real property, the portion of the cut-off date principal balance of
the underlying mortgage loan allocated to that property based on Appraised
Value, Underwritten Net Cash Flow or such other method as the related mortgage
loan seller deemed appropriate.
"AMCC" means Artesia Mortgage Capital Corporation, one of the mortgage loan
sellers.
"Annual Debt Service" means, for any underlying mortgage loan, 12 times the
amount of the monthly debt service due under the underlying the mortgage loan as
of the cut-off date.
"Appraisal Reduction Amount" means, for any mortgage loan in the trust as
to which an Appraisal Trigger Event has occurred, an amount that:
- will be determined shortly following the later of--
1. the date on which the relevant appraisal or other valuation is
obtained or performed, as described under "Servicing of the
Underlying Mortgage Loans--Required Appraisals" in this prospectus
supplement, and
2. the date on which the relevant Appraisal Trigger Event occurred; and
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- will equal the excess, if any, of "x" over "y" where--
1. "x" is equal to the sum of:
(a) the Stated Principal Balance of the mortgage loan;
(b) to the extent not previously advanced by or on behalf of the
master servicer or the trustee, all unpaid interest, other
than any Default Interest and Post-ARD Additional Interest,
accrued on the mortgage loan through the most recent due date
prior to the date of determination;
(c) all accrued but unpaid special servicing fees with respect to
the mortgage loan;
(d) all related unreimbursed advances made by or on behalf of the
master servicer, the special servicer or the trustee with
respect to the required appraisal loan, together with interest
on those advances; and
(e) all currently due and unpaid real estate taxes and
assessments, insurance premiums and, if applicable, ground
rents with respect to the related mortgaged real property or
REO Property, and
2. "y" is equal to the sum of:
(x) the excess, if any, of--
I. 90% of the resulting appraised or estimated value of the
related mortgaged real property or REO Property, over
II. the amount of any obligations secured by liens on the
property that are prior to the lien of the mortgage loan;
(y) the amount of escrow payments and reserve funds held by the
master servicer with respect to the mortgage loan that--
I. are not required to be applied to pay real estate taxes
and assessments, insurance premiums or ground rents,
II. may be used to reduce the principal balance of the
mortgage loan, and
III. are not scheduled to be applied within the next 12
months; and
(z) the amount of any letter of credit that constitutes additional
security for the mortgage loan that may be used to reduce the
principal balance of the mortgage loan.
If, however--
- the appraisal or other valuation referred to above in this
definition is not obtained or performed within 60 days of the
Appraisal Trigger Event referred to in the first bullet point of
this definition, and
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- either--
1. no comparable appraisal or other valuation, or update of a
comparable appraisal or other valuation, had been obtained
or performed during the 12-month period prior to that
Appraisal Trigger Event, or
2. there has been a material change in the circumstances
surrounding the related mortgaged real property or REO
Property subsequent to any earlier appraisal or other
valuation, or any earlier update of an appraisal or other
valuation, that, in the special servicer's sole judgment,
materially affects the value of the property,
then until the required appraisal or other valuation is obtained or performed,
the Appraisal Reduction Amount for the subject mortgage loan will equal 25% of
the Stated Principal Balance of that mortgage loan. After receipt of the
required appraisal or other valuation, the special servicer will determine the
Appraisal Reduction Amount, if any, for the subject mortgage loan as described
in the first sentence of this definition.
"Appraisal Trigger Event" means, with respect to any mortgage loan in the
trust, any of the following events:
- the mortgage loan has been modified by the special servicer in a manner
that--
1. affects the amount or timing of any payment of principal or interest
due on it, other than, or in addition to, bringing monthly debt
service payments current with respect to the mortgage loan,
2. except as expressly contemplated by the related loan documents,
results in a release of the lien of the related mortgage instrument
on any material portion of the related mortgaged real property
without a corresponding principal prepayment in an amount, or the
delivery of substitute real property collateral with a fair market
value, that is not less than the fair market value of the property
to be released, or
3. in the judgment of the special servicer, otherwise materially
impairs the security for the mortgage loan or reduces the likelihood
of timely payment of amounts due on the mortgage loan;
- the related borrower fails to make any monthly debt service payment with
respect to the mortgage loan and the failure continues for 60 days;
- any other material payment due under the related loan documents remains
unpaid for 60 days past the date on which that payment was first required
to be made;
- a receiver is appointed and continues in that capacity with respect to
the mortgaged real property securing the mortgage loan for 60 days;
- the related borrower becomes the subject of bankruptcy, insolvency or
similar proceedings and those proceedings remain undismissed and
undischarged for 60 days; or
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- the mortgaged real property securing the mortgage loan becomes an REO
Property.
"Appraisal Value" or "Appraised Value" means, for any mortgaged real
property securing a pooled mortgage loan, the appraiser's estimate of value of
the leased fee estate or, where applicable, the leasehold estate, as stated in
the appraisal with a valuation date as specified on Annex A.
"ARD Loan" means any mortgage loan in the trust having the characteristics
described in the first paragraph under "Description of the Mortgage Pool--Terms
and Conditions of the Underlying Mortgage Loans--ARD Loans" in this prospectus
supplement.
"Available P&I Funds" means, with respect to any payment date, all funds in
the payment account maintained by the certificate administrator in the name of
the trustee, that are available to make payments of interest and principal on
the series 2000-C3 certificates on that payment date.
"CMSA" means the Commercial Mortgage Securities Association, or any
association or organization that is a successor thereto.
"CMSA Investor Reporting Package" means, collectively:
- the following six electronic files--
1. CMSA loan set-up file,
2. CMSA loan periodic update file,
3. CMSA property file,
4. CMSA bond level file,
5. CMSA financial file, and
6. CMSA collateral summary file; and
- the following seven supplemental reports--
1. CMSA delinquent loan status report,
2. CMSA historical loan modification report,
3. CMSA historical liquidation report,
4. CMSA REO status report,
5. CMSA operating statement analysis report,
6. CMSA comparative financial status report, and
7. CMSA servicer watch list.
"CPR" means an assumed constant rate of prepayment each month, which is
expressed on a per annum basis, relative to the then-outstanding principal
balance of a pool of mortgage loans for the life of those loans. The CPR model
is the prepayment model that we use in this prospectus supplement.
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"Cut-off Date LTV Ratio" generally means, for any underlying mortgage loan,
the ratio of--
- the cut-off date principal balance of the mortgage loan, to
- the Appraised Value of the related mortgaged real property or properties.
However, in the event that an underlying mortgage loan is part of a cross-
collateralized group of mortgage loans, then Cut-off Date LTV Ratio means the
ratio of--
- the total cut-off date principal balance for all of the underlying
mortgage loans in the cross-collateralized group, to
- the total Appraised Value for all of the mortgaged real properties
related to the cross-collateralized group.
Furthermore, in the event that the underlying mortgage loan is subject to a
holdback, as identified in "Description of the Mortgage Pool--Additional Loan
and Property Information--Holdbacks" in this prospectus supplement, the Cut-off
Date Loan to Value is derived as discussed in that section.
"Default Interest" means, for any underlying mortgage loan, any interest,
other than late payment charges, prepayment premiums or yield maintenance
charges, that--
- accrues on a defaulted mortgage loan solely by reason of the subject
default, and
- is in excess of all interest at the related mortgage interest rate set
forth on Annex A-1 and any Post-ARD Additional Interest accrued on the
mortgage loan.
"Environmental Report" means a Phase I environmental study, a limited Phase
I environmental study, an environmental screening assessment or a transaction
screen, or an update of any of the foregoing, prepared by a third-party
consultant. In general, environmental screening assessments and transaction
screens are less exhaustive environmental assessments and/or result in less
detailed reports than Phase I environmental studies.
"ERISA" means the Employment Retirement Income Security Act of 1974, as
amended.
"ERISA Plan" means any employee benefit plan, or other retirement plan,
arrangement or account, that is subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Internal Revenue Code of 1986.
"Escrowed Replacement Reserves Current Annual Report" means, with respect
to any pooled mortgage loan, the monthly dollar amount actually deposited into a
replacement reserves escrow account in conjunction with the October 2000 monthly
debt service payment, multiplied by 12.
"Escrowed Replacement Reserves Initial Deposit" means, with respect to any
pooled mortgage loan, the dollar amount deposited into an escrow account at the
time of origination, to be used for future ongoing repairs and replacements for
the related mortgaged real property or properties.
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"Exemption-Favored Party" means any of the following--
- Salomon Smith Barney Inc.,
- any person directly or indirectly, through one or more intermediaries,
controlling, controlled by or under common control with Salomon Smith
Barney Inc., and
- any member of the underwriting syndicate or selling group of which a
person described in either of the prior two bullet points is a manager or
co-manager with respect to the offered certificates.
"Expenses" are the operating expenses incurred for a mortgaged real
property for the specified historical operating period, as reflected in the
operating statements and other information furnished by the related borrower.
Those expenses generally include--
- salaries, wages and benefits,
- the costs of utilities,
- repairs and maintenance,
- marketing,
- insurance,
- management,
- landscaping,
- security, if provided at the mortgaged real property,
- real estate taxes,
- general and administrative expenses,
- ground lease payments, and
- other similar costs,
but without any deductions for debt service, depreciation, amortization, capital
expenditures or reserves for any of these deductions.
In the case of certain retail, office and/or industrial properties,
Expenses may have included leasing commissions and tenant improvements.
In the case of hospitality properties, Expenses included such departmental
expenses as--
- guest room,
- food and beverage,
- telephone,
- rental and other expenses, and
- various undistributed operating expenses, such as general and
administrative expenses, management fees, marketing expenses and
franchise fees.
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In addition, in the case of any mortgaged real property that is subject to
an operating lease with a single operator, Revenues were calculated as described
above based on rental payments received by the related borrower under the
operating lease and not revenues received by the operator.
"GAAP" means generally accepted accounting principles in the United States.
"GCFP" means Greenwich Capital Financial Products, Inc., one of the
mortgage loan sellers.
"Interest Differential" means a yield maintenance premium that is generally
equal to the greater of:
- one percent of the mortgage loan balance at the time of prepayment; or
- the excess, if any, of --
(1) the amount of the monthly interest which would otherwise be payable
on the principal balance being prepaid from the date of the first
day of the calendar month immediately following the date of
prepayment, unless prepayment is tendered on the first day of any
calendar month during the term of the related mortgage note, in
which case from the date of prepayment, to and including the
maturity date, over
(2) the amount of the monthly interest the lender would earn if the
principal balance being prepaid were reinvested for the period from
the first day of the calendar month immediately following the date
of prepayment, unless prepayment is tendered on the first day of
any calendar month during the term of the related mortgage note, in
which case from the date of prepayment, to and including the
maturity date at the Yield Maintenance Interest Rate,
such difference to be discounted to present value at the Monthly Discount
Rate.
"IRS" means the Internal Revenue Service.
"Loan Balance at Maturity/ARD" means, with respect to any pooled mortgage
loan, the principal balance remaining after giving affect to the principal
component of the monthly debt service payment made on the maturity date of the
mortgage loan or, in the case of an ARD Loan, the anticipated repayment date,
assuming no prior prepayments or defaults.
"LUST" means leaking underground storage tank.
"Maturity Assumptions" means, collectively, the following assumptions
regarding the series 2000-C3 certificates and the mortgage loans in the trust:
- the mortgage loans have the characteristics set forth on Annex A to this
prospectus supplement and the initial mortgage pool balance is
approximately $914,661,061;
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- the initial total principal balance or notional amount, as the case may
be, of each class of series 2000-C3 certificates, other than the class R
and Y certificates, is as described in this prospectus supplement;
- the pass-through rate for each interest-bearing class of series 2000-C3
certificates is as described in this prospectus supplement;
- there are no delinquencies or losses with respect to the mortgage loans;
- there are no modifications, extensions, waivers or amendments affecting
the monthly debt service payments by borrowers on the mortgage loans;
- there are no Appraisal Reduction Amounts with respect to the mortgage
loans;
- there are no casualties or condemnations affecting the corresponding
mortgaged real properties;
- with the exception of one mortgage loan with a fifth day of the month
payment date, all of the mortgage loans provides monthly debt service
payments to be due on the first day of each month and accrues interest on
the respective basis described in this prospectus supplement, which is a
30/360 basis or an actual/360 basis;
- there are no breaches of any mortgage loan seller's representations and
warranties regarding the mortgage loans that are being sold by it;
- monthly debt service payments on the mortgage loans are timely received
on the respective payment day of each month, and amortization is assumed
to occur prior to prepayment;
- no voluntary or involuntary prepayments are received as to any mortgage
loan during that mortgage loan's prepayment lock-out period, defeasance
period or prepayment consideration period, in each case if any;
- each ARD Loan is paid in full on its anticipated repayment date;
- except as otherwise assumed in the immediately preceding two bullet
points, prepayments are made on each of the mortgage loans at the
indicated CPRs set forth in the subject tables or other relevant part of
this prospectus supplement, without regard to any limitations in those
mortgage loans on partial voluntary principal prepayment;
- all prepayments on the mortgage loans are assumed to be accompanied by a
full month's interest;
- no person or entity entitled thereto exercises its right of optional
termination described in this prospectus supplement under "Description of
the Offered Certificates--Termination";
- no mortgage loan is required to be repurchased by any mortgage loan
seller;
- no prepayment premiums or yield maintenance charges are collected;
- there are no Additional Trust Fund Expenses;
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- payments on the offered certificates are made on the 18th day of each
month, commencing in January 2001; and
- the offered certificates are settled on December 19, 2000.
"Maturity Date/ARD LTV Ratio" means, for any underlying mortgage loan, the
related Loan Balance at Maturity/ARD for the particular mortgage loan, divided
by the Appraised Value of the related mortgaged real property or properties.
However, if an underlying mortgage loan is part of a cross-collateralized group
of mortgage loans, then Maturity Date/ARD LTV Ratio means the ratio of--
- the total Loan Balance at Maturity/ARD for all of the underlying mortgage
loans in the cross-collateralized group, to
- the total Appraised Value for all of the mortgaged real properties
related to the cross-collateralized group.
"Medical Mutual of Ohio Loan" means the pooled mortgage loan secured by the
Medical Mutual of Ohio Property.
"Medical Mutual of Ohio Property" means the mortgaged real property
identified on Annex A as Medical Mutual of Ohio.
"Monthly Discount Rate" means the rate which, when compounded monthly, is
equivalent to the discount rate as described under "Description of the Offered
Certificates--Payments--Payments of Prepayment Premiums and Yield Maintenance
Charges" in this prospectus supplement.
"Net Aggregate Prepayment Interest Shortfall" means, with respect to any
payment date, the excess, if any, of--
- the Prepayment Interest Shortfalls incurred with respect to the mortgage
pool during the related collection period, over
- the total payments made by the master servicer to cover those Prepayment
Interest Shortfalls.
"Net Operating Income" or "NOI" means, for any mortgaged real property
securing a pooled mortgage loan, the net property income derived from the
property, which is equal to Revenues less Expenses, for the applicable time
period, that was available for debt service, as established by information
provided by the related borrower, except that in some cases the net property
income has been adjusted by removing various non-recurring expenses and revenues
or by other normalizations. NOI does not reflect accrual of costs such as
reserves, capital expenditures, tenant improvements and leasing commissions and
does not reflect non-cash items such as depreciation or amortization. In some
cases, capital expenditures, tenant improvements and leasing commissions and
non-recurring items may have been treated by a borrower as an expense but were
excluded from Expenses to reflect normalized NOI. We have not made any attempt
to verify the accuracy of any information provided by a particular borrower or
to reflect changes in net property income that may have occurred since the date
of the information provided by any borrower for the related mortgaged real
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property. NOI was not necessarily determined in accordance with GAAP. Moreover,
NOI is not a substitute for net income determined in accordance with GAAP as a
measure of the results of a mortgaged real property's operations or a substitute
for cash flows from operating activities determined in accordance with GAAP as a
measure of liquidity and in certain cases may reflect partial-year
annualizations.
"NOI Debt Service Coverage Ratio" or "NOI DSCR" means, for any underlying
mortgage loan, the ratio of--
- the annualized NOI for the corresponding mortgaged real property or
properties for the specified operating period, to
- the Annual Debt Service for the underlying mortgage loan.
However, if an underlying mortgage loan is part of a cross-collateralized
group of mortgage loans, then NOI DSCR means the ratio of--
- the total NOI for the specified 12-month time period for all of the
mortgaged real properties related to the cross-collateralized group, to
- the total Annual Debt Service for all of the underlying mortgage loans in
the cross-collateralized group.
"NRSF", "NRS" or "SF" generally means the square footage of the net
rentable area of a mortgaged real property.
"Occupancy %" or "Occupancy Percentage" means:
- for any mortgaged real property other than a hotel, the percentage of
leasable square footage or total Units/Rooms/Pads, as the case may be, at
the particular property that was physically occupied as of a specified
date, as derived from the most recent rent roll provided by the borrower;
and
- for any hotel property, the average monthly occupancy reported for the 12
months preceding the specified date.
"One Financial Place Loan" means the pooled mortgage loan secured by the
One Financial Place Property.
"One Financial Place Property" means the mortgaged real property identified
an Annex A as One Financial Place.
"Original Amortization Term" means, with respect to any underlying mortgage
loan, the number of months that would be required to fully amortize the mortgage
loan's original principal balance assuming:
- the actual mortgage loan rate;
- the actual monthly debt service payment; and
- an assumed interest accrual method of 30/360, regardless of the actual
interest accrual method.
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"Party in Interest" means any person that is a "party in interest" within
the meaning of ERISA or a "disqualified person" within the meaning of the
Internal Revenue Code of 1986.
"Permitted Encumbrances" means, with respect to any mortgaged real property
securing a mortgage loan in the trust, any and all of the following:
- the lien of current real property taxes and special assessments not yet
delinquent or accruing interest or penalties;
- covenants, conditions and restrictions, rights of way, easements and
other matters of public record as of the date of recording of the related
mortgage instrument, which do not materially and adversely affect the
value of the mortgaged real property or interfere with the related
borrower's ability to make required interest and principal payments or to
make use of the related mortgaged real property for the intended purposes
for it;
- leases and subleases pertaining to the mortgaged real property which the
related mortgage loan seller did not require to be subordinated to the
lien of the related mortgage instrument, provided that those leases and
subleases, if any, are with entities which are not affiliated with the
related mortgage loan seller, and
- other matters which do not, individually or in the aggregate, materially
and adversely affect the value of the mortgaged real property as security
for the related mortgage loan or interfere with the related borrower's
ability to make required principal and interest payments or to make use
of the mortgaged real property for the intended purposes for it.
"Permitted Investments" means the U.S. government securities and other
investment grade obligations specified in the pooling and servicing agreement.
"Post-ARD Additional Interest" means, with respect to any ARD Loan, the
additional interest accrued with respect to that mortgage loan as a result of
the marginal increase in the related mortgage interest rate upon passage of the
related anticipated repayment date, as that additional interest may compound in
accordance with the terms of that mortgage loan.
"Prepayment Interest Excess" means, with respect to any full or partial
prepayment of a pooled mortgage loan made by the related borrower during any
collection period after the due date for that loan, the amount of any interest
collected on that prepayment for the period following that due date, less the
amount of master servicing fees payable from that interest collection, and
exclusive of any Default Interest, Post-ARD Additional Interest, prepayment
premiums, yield maintenance charges and late payment charges included in that
interest collection.
"Prepayment Interest Shortfall" means, with respect to any full or partial
prepayment of a pooled mortgage loan made by the related borrower during any
collection period prior to the due date for that loan, the amount of any
uncollected interest that would have accrued on that prepayment through that due
date, less the amount of master servicing fees that would have been payable from
that uncollected
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interest, and exclusive of any portion of that uncollected interest that would
have been Default Interest, Post-ARD Additional Interest, prepayment premiums,
yield maintenance charges or late payment charges.
"Prepayment Provisions" for each underlying mortgage loan are as follows:
- "LO(y)" means that the original duration of the lock-out period is y
payments;
- "Defeasance(y)" means that the original duration of the defeasance period
is y payments;
- "Grtrx%UPBorYM(y)" means that, for an original period of y payments, the
relevant prepayment premium will equal the greater of the applicable
yield maintenance charge and x% of the principal amount prepaid;
- "YM(y)" means that, for an original period of y payments, the relevant
prepayment premium will equal the yield maintenance charge;
- "Free(y)" means that the underlying mortgage loan is freely prepayable
for a period of y payments; and
- "x%(y)" means that, for an original period of y payments, the relevant
prepayment premium will equal "x%" of the principal amount prepaid.
"Present Value" means for all underlying mortgage loans with a yield
maintenance premium, other than the two loans discussed below, a yield
maintenance premium that is generally equal to:
- the product obtained by multiplying--
1. the ratio of--
(a) the amount of principal being prepaid, to
(b) the principal balance outstanding, assuming no prepayments
have been made, times
2. the present value, as of the prepayment date, of the remaining
scheduled payments of principal and interest from the prepayment
date through, as applicable, the maturity date or anticipated
repayment date, including any balloon payment or assumed prepayment
on the anticipated repayment date, as applicable, determined by
discounting those payments at the Monthly Discount Rate; less
- the amount of principal being prepaid.
For the mortgage loan secured by the mortgaged real property identified on
Annex A to this prospectus supplement as Traders Tower-Self Park, "Present
Value" means a yield maintenance premium that is generally equal to the product
obtained by multiplying--
1. the amount, if any, by which the interest rate on the underlying
mortgage loan exceeds the Yield Maintenance Interest Rate, times
2. the outstanding balance of the underlying mortgage loan as of the
prepayment date, times
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3. the quotient, rounded to the nearest one-hundredth of one percent,
obtained by dividing the number of days from and including the
prepayment date to and including the maturity date of the underlying
mortgage loan by 365,
discounted, as of the prepayment date, to the present value using the Yield
Maintenance Interest Rate, assuming that this amount would be received in equal
monthly payments on each monthly anniversary of the prepayment date through and
including the maturity date of the underlying mortgage loan.
For the mortgage loan secured by the mortgaged real property identified on
Annex A to this prospectus supplement as Almond Grand Gurnee, "Present Value"
means a yield maintenance premium that is generally equal to the product
obtained by multiplying--
1. the amount, if any, by which the interest rate on the underlying
mortgage loan exceeds the Yield Maintenance Interest Rate, times
2. the outstanding balance of the underlying mortgage loan as of the
prepayment date, times
3. the quotient, rounded to the nearest one-hundredth of one percent,
obtained by dividing the number of days from and including the
prepayment date to and including the maturity date of the underlying
mortgage loan by 365,
discounted, as of the prepayment date, to the present value using the Monthly
Discount Rate, assuming that this amount would be received in equal monthly
payments on each monthly anniversary of the prepayment date through and
including the maturity date of the underlying mortgage loan.
"Realized Losses" means losses on or with respect to the pooled mortgage
loans arising from the inability of the master servicer and/or the special
servicer to collect all amounts due and owing under the mortgage loans,
including by reason of the fraud or bankruptcy of a borrower or, to the extent
not covered by insurance, a casualty of any nature at a mortgaged real property.
We discuss the calculation of Realized Losses under "Description of the Offered
Certificates--Reductions to Certificate Principal Balances in Connection with
Realized Losses and Additional Trust Fund Expenses" in this prospectus
supplement.
"Recommended Annual Replacement Reserves" means, for any mortgaged real
property securing a pooled mortgage loan, the expected average annual amount for
future ongoing repairs and replacements, without any adjustment for inflation,
over a time horizon not less than the original loan term of the respective
mortgage loan, as estimated in the Property Condition Assessment.
"Related Mortgage Loan Group" means a group of mortgage loans that have at
least one key principal or sponsor in common and that may or may not be cross-
collateralized or have the same borrower.
"Related Underlying Mortgage Loans" means any two or more underlying
mortgage loans for which the related mortgaged real properties are either owned
by the same entity or owned by two or more entities controlled by the same key
principals.
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"REMIC" means a "real estate mortgage investment conduit" as defined in
Section 860D of the Internal Revenue Code of 1986.
"REO Property" means any mortgaged real property that is acquired by the
trust through foreclosure, deed-in-lieu of foreclosure or otherwise following a
default on the corresponding pooled mortgage loan.
"Restricted Group" means, collectively, the following persons and
entities--
- the trustee,
- the Exemption-Favored Parties,
- us,
- the master servicer,
- the special servicer,
- any sub-servicers,
- the mortgage loan sellers,
- each borrower, if any, with respect to pooled mortgage loans constituting
more than 5.0% of the total unamortized principal balance of the mortgage
pool as of the cut-off date, and
- any and all affiliates of any of the aforementioned persons.
"Revenues" means the gross revenues received with respect to a mortgaged
real property securing any pooled mortgage loan, for the specified historical
operating period, as reflected in the operating statements and other information
furnished by the related borrower. Those revenues generally include:
- for the multifamily rental properties, gross rental and other revenues;
- for the retail, office and industrial properties, base rent, percentage
rent, expense reimbursements and other revenues; and
- for the hospitality properties, guest room, food and beverage, telephone
and other revenues.
In addition, in the case of any mortgaged real property that is subject to
an operating lease with a single operator, Revenues were based on rental
payments received by the related borrower under the operating lease and not
revenues received by the operator.
"SBRC" means Salomon Brothers Realty Corp., one of the mortgage loan
sellers.
"SEC" means the Securities and Exchange Commission.
"Servicing Standard" means, with respect to either the master servicer or
the special servicer, to service and administer the pooled mortgage loans and
any REO Properties owned by the trust for which that party is responsible:
- with the same care, skill and diligence as is normal and usual in its
general mortgage servicing and asset management activities on behalf of
third parties or
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on behalf of itself, whichever is higher, with respect to comparable
mortgage loans and REO properties;
- with a view to--
1. the timely collection of all scheduled payments of principal and
interest under those mortgage loans, and
2. if a mortgage loan comes into and continues in default and if, in
the judgment of the special servicer, no satisfactory arrangements
can be made for the collection of the delinquent payments, the
maximization of the recovery on that defaulted mortgage loan to the
series 2000-C3 certificateholders, as a collective whole, on a
present value basis; and
- without regard to--
1. any known relationship that the master servicer or the special
servicer, as the case may be, or any of its affiliates may have with
any of the underlying borrowers,
2. the ownership of any series 2000-C3 certificate by the master
servicer or the special servicer, as the case may be, or by any of
its affiliates,
3. the obligation of the master servicer to make advances,
4. the special servicer's obligation to make, or direct the master
servicer to make, servicing advances,
5. the right of the master servicer or the special servicer, as the
case may be, or any of its affiliates to receive reimbursement of
costs, or the sufficiency of any compensation payable to it, under
the pooling and servicing agreement or with respect to any
particular transaction,
6. the ownership, servicing or management by the master servicer or the
special servicer, as the case may be, or any of its affiliates of
any other real estate loans or real properties not included in or
securing, as the case may be, the mortgage pool or the right to
service or manage for others any such other real estate loans or
real properties, and
7. any obligation of the master servicer or the special servicer, as
the case may be, or any of its affiliates, to repurchase any
mortgage loan under the related mortgage loan purchase agreement.
"Servicing Transfer Event" means, with respect to any mortgage loan in the
trust, any of the following events:
1. the related borrower fails to make when due any balloon payment required
under the related promissory note;
2. the related borrower fails to make when due any other payment, including
any other monthly debt service payments, required under the related
promissory note or the related mortgage, deed of trust or other
comparable security instrument,
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and either the failure actually continues, or the master servicer
believes it will continue, unremedied for 60 days;
3. the master servicer determines that a default in the making of a monthly
debt service payment, including a balloon payment, or any other material
payment required to be made under the related promissory note or the
related mortgage, deed of trust or other comparable security instrument,
is likely to occur in the foreseeable future and, except in the case of
a balloon payment, either--
- the default is likely to remain unremedied for at least 60 days, or
- the related borrower has requested a material modification of the
mortgage loan, other than the waiver of a due-on-sale clause;
4. the related borrower has transferred, or permitted the transfer of, the
corresponding mortgaged real property or direct or indirect ownership or
control of the related borrower or management of the corresponding
mortgaged real property, or has changed the management of the
corresponding mortgaged real property, in any case in violation of the
related loan documents;
5. the master servicer determines that a non-payment default, other than as
described above, has occurred under the mortgage loan that may
materially impair the value of the corresponding mortgaged real property
as security for the mortgage loan and the default continues unremedied
for the applicable cure period under the terms of the mortgage loan or,
if no cure period is specified, for 60 days;
6. various events of bankruptcy, insolvency, readjustment of debt,
marshalling of assets and liabilities, or similar proceedings occur with
respect to the related borrower or the corresponding mortgaged real
property, or the related borrower takes various actions indicating its
bankruptcy, insolvency or inability to pay its obligations; or
7. the master servicer receives notice of the commencement of foreclosure
or similar proceedings with respect to the corresponding mortgaged real
property.
A Servicing Transfer Event will cease to exist:
- with respect to the circumstances described in clauses 1. and 2. of this
definition, if and when the related borrower makes three consecutive full
and timely monthly debt service payments under the terms of the mortgage
loan, as those terms may be changed or modified in connection with a
bankruptcy or similar proceeding involving the related borrower or by
reason of a modification, waiver or amendment granted or agreed to by the
special servicer;
- with respect to the circumstances described in clauses 3. and 6. of this
definition, if and when those circumstances cease to exist in the
judgment of the special servicer;
- with respect to the circumstances described in clause 4. and 5. of this
definition, if and when the default is cured in the judgment of the
special servicer; and
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- with respect to the circumstances described in clause 7. of this
definition, if and when the proceedings are terminated.
"SMMEA" means the Secondary Mortgage Market Enhancement Act of 1984.
"Stated Principal Balance" means, for each mortgage loan in the trust, an
amount that:
- will initially equal its unpaid principal balance as of the cut-off date,
after application of all scheduled payments of principal due on or before
that date, whether or not those payments have been received; and
- will be permanently reduced on each subsequent payment date, to not less
than zero, by--
1. that portion, if any, of the Total Principal Payment Amount for that
payment date that is attributable to that mortgage loan, and
2. the principal portion of any Realized Loss incurred with respect to
that mortgage loan during the related collection period.
However, the "Stated Principal Balance" of any mortgage loan in the trust
will, in all cases, be zero as of the payment date following the end of the
collection period in which it is determined that all amounts ultimately
collectible with respect to that mortgage loan or any related REO Property have
been received.
"Sub-Servicing Fee Rate" means, for any underlying mortgage loan, the per
annum rate at which the monthly sub-servicing fee is payable to any
sub-servicer.
"Total Principal Payment Amount" means:
- for any payment date prior to the final payment date, an amount equal to
the total, without duplication, of the following--
1. all payments of principal, including voluntary principal
prepayments, received on the pooled mortgage loans during the
related collection period, exclusive of any of those payments that
represents a late collection of principal for which an advance was
previously made for a prior payment date or that represents a
monthly payment of principal due on or before the cut-off date or on
a due date subsequent to the end of the related collection period,
2. all monthly payments of principal received on the pooled mortgage
loans prior to, but that are due during, the related collection
period,
3. all other collections, including liquidation proceeds, condemnation
proceeds, insurance proceeds and repurchase proceeds, that were
received on or with respect to any of the pooled mortgage loans or
any related REO Properties during the related collection period and
that were identified and applied by the master servicer as
recoveries of principal of the subject mortgage loan or, in the case
of an REO Property, of the related mortgage loan, in each case net
of any portion of the particular collection that represents a late
collection
S-175
<PAGE> 176
of principal due on or before the cut-off date or for which an advance of
principal was previously made for a prior payment date, and
4. all advances of principal made with respect to the pooled mortgage
loans for that payment date; and
5. the excess, if any, of the Total Principal Payment Amount for the
prior payment date, if any, over the total payments of principal
made on that prior payment date with respect to the series 2000-C3
certificates with principal balances; and
- for the final payment date, an amount equal to the total Stated Principal
Balance of the mortgage pool outstanding immediately prior to that final
payment date.
"Treasury Flat-Maturity" means the average yield for "This Week" as
reported by the Federal Reserve Board in Federal Reserve Statistical Release
H.15(519) for the constant maturity treasury security having a maturity
coterminous with the maturity date or, in the case of an ARD Loan, the
anticipated repayment date of the prepaid underlying mortgage loan as of any
particular date. If there are no constant maturity treasuries having such a
maturity, then Treasury Flat-Maturity will equal the interpolation of the yields
of the constant maturity treasuries with maturities longer and shorter than the
remaining term to maturity or, in the case of an ARD Loan, the anticipated
repayment date for the prepaid mortgage loan.
"Treasury Flat-WAL" means the average yield for "This Week" as reported by
the Federal Reserve Board in Federal Reserve Statistical Release H.15(519) for
the constant maturity treasury security having a maturity coterminous with the
remaining weighted average life, rounded to the nearest whole decimal, of the
prepaid mortgage loan. In the case of an ARD Loan, the remaining weighted
average life will be calculated assuming all principal is repaid on the
anticipated repayment date. If there are no constant maturity treasuries having
such a maturity, then Treasury Flat-WAL will equal the interpolation of the
yields of the constant maturity treasuries with maturities longer and shorter
than the remaining weighted average life for the prepaid mortgage loan.
"Underwritten Expenses" or "U/W Expenses" means, with respect to any
mortgaged real property securing a pooled mortgage loan, the annual operating
expenses estimated for that property, generally derived from the historical
annual expenses reflected in the operating statements and other information
furnished by the related borrower, except that those expenses were often
modified as follows:
- operating expenses were generally adjusted by various factors such as
inflation, appraisers' estimates and historical trends;
- if there was no management fee or a management fee which varies from the
market, it was assumed that a management fee is payable with respect to
the mortgaged real property in an amount that is the greater of the
market rate as determined by an appraiser or the lender's minimum
management fee underwriting criteria for the applicable property type;
and
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<PAGE> 177
- those expenses were adjusted so as to eliminate any capital expenditures,
loan closing costs, tenant improvements or leasing commissions and
similar non-recurring expenses.
Underwritten Expenses generally include--
- salaries, wages and benefits,
- the costs of utilities,
- repairs and maintenance,
- marketing,
- insurance,
- management,
- landscaping,
- security, if provided at the mortgaged real property,
- real estate taxes,
- general and administrative expenses, and
- ground lease payments, and other costs,
but without any deductions for debt service, depreciation and amortization or
capital expenditures, tenant improvements or leasing commissions.
In the case of hospitality properties, Underwritten Expenses included such
departmental expenses as--
- guest room,
- food and beverage,
- telephone,
- rental and other expenses, and
various undistributed operating expenses such as--
- general and administrative expenses,
- management fees,
- marketing expenses, and
- franchise fees.
In addition, in the case of any mortgaged real property that is subject to
an operating lease with a single operator, Underwritten Expenses were based on
expenses incurred by the related borrower under the operating lease and not
operating expenses by the operator.
"Underwritten Net Cash Flow", "Underwritten NCF" or "U/W NCF" means, for
any mortgaged real property, the Underwritten NOI for that property reduced by
the
S-177
<PAGE> 178
following items, if and to the extent that the items have not already been
netted-out in calculating Underwritten NOI--
- underwritten capital expenditure reserves,
- underwritten furniture, fixtures and equipment reserves (for hospitality
properties), and
- underwritten tenant improvements and leasing commission reserves.
Underwritten Net Cash Flow is subject to the same limitations and qualifications
as Underwritten NOI.
"Underwritten NCF Debt Service Coverage Ratio" and "U/W NCF DSCR" means,
for any underlying mortgage loan, the ratio of--
- the annualized U/W NCF for the corresponding mortgaged real property or
properties for the specified operating period, to
- the Annual Debt Service for the underlying mortgage loan.
However, if an underlying mortgage loan is part of a cross-collateralized group
of mortgage loans, then U/W NCF DSCR means the ratio of--
- the total U/W NCF for the specified 12-month time period for all of the
mortgaged real properties related to the cross-collateralized group, to
- the total Annual Debt Service for all of the underlying mortgage loans in
the cross-collateralized group.
"Underwritten NOI" or "U/W NOI" means, for any mortgaged real property
securing any pooled mortgage loan, an estimate, made at or about the time of
origination of that mortgage loan or, in some cases, more recently derived from
current financial information, of the total cash flow anticipated to be
available for Annual Debt Service on the underlying mortgage loan, calculated as
the excess of Underwritten Revenues over Underwritten Expenses before
considering any reserves or capital expenditures.
Underwritten NOI describes the cash flow available before deductions for
capital expenditures such as tenant improvements, leasing commissions and
structural reserves. In general, Underwritten NOI has been calculated without
including underwritten reserves or any other underwritten capital expenditures
among Underwritten Expenses. Had those reserves been so included, Underwritten
NOI would have been lower. Even in those cases where such underwritten reserves
or any other underwritten capital expenditures were so included, no cash may
have been actually escrowed. No representation is made as to the future
operating income of the properties, nor is the Underwritten NOI set forth in
this prospectus supplement with respect to any mortgaged real property intended
to represent such future net operating income.
Actual conditions at any mortgaged real property may differ substantially,
from the assumed conditions used in calculating Underwritten NOI. In particular,
the assumptions regarding future revenues, tenant vacancies, future expenses and
various other relevant factors, may differ substantially from actual conditions
and circumstances with respect to
S-178
<PAGE> 179
any mortgaged real property. There can be no assurance that the actual financial
performance of any of the mortgaged real properties will meet the underwritten
results assumed in connection with the origination or purchase of the underlying
mortgage loans.
Underwritten NOI and the Underwritten Revenues and Underwritten Expenses
used to determine Underwritten NOI for each mortgaged real property are derived
from information furnished by the respective borrowers. Net income for a
mortgaged real property as determined under GAAP would not be the same as the
Underwritten NOI for the mortgaged real property set forth in the following
schedule or tables. In addition, Underwritten NOI is not a substitute for or
comparable to operating income as determined in accordance with GAAP as a
measure of the results of a property's operations or a substitute for cash flows
from operating activities determined in accordance with GAAP as a measure of
liquidity.
"Underwritten NOI Debt Service Coverage Ratio", "Underwritten NOI DSCR" or
"U/W NOI DSCR" means, for any underlying mortgage loan, the ratio of--
- the Underwritten NOI for the related mortgaged real property or
properties, to
- the Annual Debt Service for the related underlying mortgage loan.
However, if an underlying mortgage loan is part of a cross-collateralized group
of mortgage loans, then Underwritten NOI DSCR means the ratio of--
- the total Underwritten NOI for all of the mortgaged real properties
related to the cross-collateralized group, to
- the total Annual Debt Service for all of the underlying mortgage loans in
the cross-collateralized group.
"Underwritten Revenues" or "U/W Revenues" means the annual operating
revenues estimated for a mortgaged real property, and generally equals, subject
to the assumptions and adjustments specified below:
- in the case of the multifamily rental properties, the amount of gross
rents expected to be received during a 12-month period, as estimated by
annualizing a current rent roll provided by the borrower in connection
with the origination of the underlying mortgage loan or, more recently,
under its periodic operating statements reporting requirements;
- in the case of the commercial properties, other than hospitality
properties, the amount of gross rents expected to be received during a
12-month period, as estimated by annualizing a current rent roll provided
by the borrower in connection with the origination of the underlying
mortgage loan or, more recently, under its periodic operating statements
reporting requirements, plus--
1. for some commercial properties, percentage rents or other revenues
based on normalized actual amounts collected during previous
operating periods, plus
2. in the case of some commercial properties with modified gross or net
leases, the amount of expense reimbursements expected to be received
over a
S-179
<PAGE> 180
12-month period, as estimated based upon actual lease terms
currently in effect or actual amounts collected during previous
operating periods; and
- in the case of hospitality properties, annual revenues consistent with
historical operating trends and market and competitive conditions.
For multi-family rental and commercial properties, Underwritten Revenues
also may include some other revenue items such as parking fees, laundry income
and late fees.
However, Underwritten Revenues were decreased to take into account--
- the market vacancy rate, if that rate was more than the vacancy rate
reflected in the most recent rent roll or operating statements, as the
case may be, furnished by the related borrower,
- lender's minimum vacancy underwriting criteria for the applicable
property type, and
- for some commercial properties, applicable market rental rates,
resulting, in some cases, in base rents being marked downward to market
rents.
In addition, in the case of some commercial properties, the Underwritten
Revenues were adjusted upward to account for all or a portion of the rents
provided for under any rent step-ups or new leases scheduled to take effect,
generally within six months of the date of the rent roll used to underwrite the
mortgaged property. In addition, in the case of any mortgaged real properties
that are subject to an operating lease with a single operator, Underwritten
Revenues were based on rental payments received by the related borrower under
the operating lease and not revenues received by the operator.
"Units", "Pads" and "Rooms", respectively, mean:
- in the case of a mortgaged real property operated as multifamily housing,
the number of apartments, regardless of the size of or number of rooms in
such apartment, which are referred to in Annex A as "Units";
- in the case of a mortgaged real property operated as a mobile home park,
the number of pads, which are referred to in Annex A as "Pads"; and
- in the case of a mortgaged real property operated as a hotel or motel,
the number of rooms, which are referred to in Annex A as "Rooms".
"U/W Annual Replacement Reserves" or "Underwritten Annual Replacement
Reserves" means the average annual ongoing repairs and replacements estimated
for a mortgaged real property, generally consistent with the greater of (a) the
Recommended Annual Replacement Reserves and (b) the lender's minimum
underwriting standard for that property type.
"Weighted Average Pool Pass-Through Rate" means, for each payment date, the
weighted average of the following annual rates with respect to all of the
mortgage loans
S-180
<PAGE> 181
in the trust, weighted on the basis of the mortgage loans' respective Stated
Principal Balances immediately prior to that payment date:
A. in the case of each mortgage loan that accrues interest on a 30/360
basis, an annual rate equal to--
(1) the mortgage interest rate in effect for that mortgage loan as of
the cut-off date, minus
(2) the related Administrative Fee Rate; and
B. in the case of each mortgage loan that accrues interest on an actual/360
basis, an annual rate generally equal to the product of 12 times a
fraction, expressed as a percentage--
(1) the numerator of which fraction is, subject to adjustment as
described below in this definition, the amount of interest that
accrued or, in the case of a prepayment or other early liquidation,
would otherwise have accrued, in each case, with respect to that
mortgage loan on an actual/360 basis, during the related interest
accrual period, based on--
- its Stated Principal Balance immediately preceding that payment
date, and
- a rate per annum equal to its mortgage interest rate in effect
as of the cut-off date, minus the related Administrative Fee
Rate, and
(2) the denominator of which fraction is the Stated Principal Balance
of the mortgage loan immediately prior to that payment date.
Notwithstanding the foregoing, if the subject payment date occurs during
January, except during a leap year, or February, then, in the case of any
particular mortgage loan that accrues interest on an actual/360 basis, the
amount of interest referred to in the numerator of the fraction described in
clause B(1) above will be decreased to reflect any interest reserve amount with
respect to that mortgage loan that is transferred from the payment account to
the interest reserve account during that month. Furthermore, if the subject
payment date occurs during March, then, in the case of any particular mortgage
loan that accrues interest on an actual/360 basis, the amount of interest
referred to in the numerator of the fraction described in clause B(1) above will
be increased to reflect any interest reserve amounts with respect to that
mortgage loan that are transferred from the interest reserve account to the
payment account during that month.
"Year Built" means, with respect to any mortgaged real property, the year
during which construction of the mortgaged real property was completed. In the
event of multiple years of construction, only the most recent of those years is
shown.
"Year Renovated" means, with respect to any mortgaged real property, the
year during which the most recent renovation, if any, of the mortgaged real
property was completed. That renovation would generally include significant
capital improvements to either the interior or exterior of the mortgaged
property. In the event of multiple years of renovation, only the most recent of
those years is shown.
"Yield Maintenance Interest Rate" means, with respect to any mortgage loan
in the trust, the interest rate specified in the column labelled "YM Interest
Rate" on Annex A to this prospectus supplement.
S-181
<PAGE> 182
ANNEX A
CHARACTERISTICS OF THE UNDERLYING
MORTGAGE LOANS AND THE MORTGAGED REAL PROPERTIES
Note: For purposes of presenting information regarding the original and
remaining terms to maturity of the respective pooled mortgage loans in
this Annex A, ARD Loans are assumed to mature on their respective
anticipated repayment dates.
A-1
<PAGE> 183
(This page intentionally left blank)
A-2
<PAGE> 184
CUT-OFF DATE BALANCES
<TABLE>
<CAPTION>
CUMULATIVE WEIGHTED AVERAGES
TOTAL % OF INITIAL % OF INITIAL -------------------------------------------
RANGE OF NUMBER OF CUT-OFF DATE MORTGAGE MORTGAGE MORTGAGE STATED U/W
CUT-OFF DATE MORTGAGE PRINCIPAL POOL POOL INTEREST REMAINING NCF CUT-OFF DATE
PRINCIPAL BALANCES LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------------ --------- ------------ ------------ ------------ -------- ---------- ---- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 0 to $ 999,999... 23 $ 17,070,457 1.87% 1.87% 7.953% 120 1.39x 62.79%
1,000,000 to
2,499,999............... 59 98,335,194 10.75 12.62 8.220 121 1.39 67.07
2,500,000 to
4,999,999............... 48 169,436,494 18.52 31.14 8.204 113 1.31 69.92
5,000,000 to
7,499,999............... 24 142,117,998 15.54 46.68 8.210 114 1.31 69.41
7,500,000 to
9,999,999............... 7 60,042,882 6.56 53.24 8.621 106 1.38 62.90
10,000,000 to
14,999,999............... 6 70,527,861 7.71 60.95 8.386 102 1.30 68.56
15,000,000 to
24,999,999............... 11 202,187,997 22.11 83.06 8.022 114 1.25 72.36
25,000,000 to
49,999,999............... 1 35,364,183 3.87 86.93 8.380 118 1.24 73.98
50,000,000 to
119,999,999.............. 1 119,577,993 13.07 100.00 7.890 114 1.63 53.62
--- ------------ ------ ----- --- ---- -----
Totals/Wtd. Avg......... 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ==== =====
</TABLE>
MORTGAGE TYPE
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
TOTAL % OF INITIAL MAXIMUM -------------------------------------------
CUT-OFF DATE MORTGAGE CUT-OFF DATE MORTGAGE STATED U/W
NUMBER OF PRINCIPAL POOL PRINCIPAL INTEREST REMAINING NCF CUT-OFF DATE
LOAN TYPE MORTGAGES BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
--------- --------- ------------ ------------ ------------ -------- ---------- ---- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balloon.............. 160 $743,965,745 81.34% $ 35,364,183 8.230% 112 1.31x 69.94%
ARD.................. 2 135,665,960 14.83 119,577,993 7.851 113 1.59 55.31
Fully Amortizing..... 18 35,029,355 3.83 8,145,364 8.095 155 1.25 60.32
--- ------------ ------ ----- --- ---- -----
Totals/Wtd. Avg.... 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ==== =====
</TABLE>
ACCRUAL TYPE
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
TOTAL % OF INITIAL MAXIMUM ------------------------------------------------
NUMBER OF CUT-OFF DATE MORTGAGE CUT-OFF DATE MORTGAGE STATED U/W
MORTGAGE PRINCIPAL POOL PRINCIPAL INTEREST REMAINING NCF CUT-OFF DATE
ACRRUAL TYPE LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------ --------- ------------ ------------ ------------ ------------- ---------- ---- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Actual/360 Basis..... 166 $894,399,558 97.78% $119,577,993 8.167% 113 1.35x 67.72%
30/360 Basis......... 14 20,261,503 2.22 8,343,003 8.234 144 1.51 53.43
--- ------------ ------ ----- --- ---- -----
Totals/Wtd. Avg.... 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ==== =====
</TABLE>
A-3
<PAGE> 185
MORTGAGE RATES
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
% OF CUMULATIVE ---------------------
NUMBER OF TOTAL CUT-OFF INITIAL % OF INITIAL MORTGAGE STATED
RANGE OF MORTGAGE MORTGAGE DATE PRINCIPAL MORTGAGE POOL MORTGAGE POOL INTEREST REMAINING
INTEREST RATES LOANS BALANCE BALANCE BALANCE RATE TERM (MO.)
----------------- --------- -------------- ------------- ------------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
0.00% to 6.99%......................... 1 $ 1,451,686 0.16% 0.16% 6.750% 95
7.25% to 7.49%......................... 13 31,700,293 3.47 3.62 7.312 121
7.50% to 7.74%......................... 19 93,868,299 10.26 13.89 7.623 113
7.75% to 7.99%......................... 22 198,447,686 21.70 35.58 7.883 116
8.00% to 8.24%......................... 40 174,293,961 19.06 54.64 8.098 114
8.25% to 8.49%......................... 44 239,220,167 26.15 80.79 8.374 115
8.50% to 8.74%......................... 29 94,381,467 10.32 91.11 8.598 117
8.75% to 8.99%......................... 8 58,531,506 6.40 97.51 8.830 97
9.00% to 9.24%......................... 3 22,163,684 2.42 99.93 9.097 92
9.25% to 9.49%......................... 1 602,312 0.07 100.00 9.350 76
--- ------------ ------ ----- ---
Totals/Wtd. Avg........................ 180 $914,661,061 100.00% 8.169% 113
=== ============ ====== ===== ===
<CAPTION>
WEIGHTED AVERAGES
--------------------
U/W
RANGE OF MORTGAGE NCF CUT-OFF DATE
INTEREST RATES DSCR LTV RATIO
----------------- ----- ------------
<S> <C> <C>
0.00% to 6.99%......................... 1.83x 53.37%
7.25% to 7.49%......................... 1.37 70.33
7.50% to 7.74%......................... 1.38 67.19
7.75% to 7.99%......................... 1.50 60.74
8.00% to 8.24%......................... 1.31 69.06
8.25% to 8.49%......................... 1.27 72.29
8.50% to 8.74%......................... 1.29 67.95
8.75% to 8.99%......................... 1.24 67.41
9.00% to 9.24%......................... 1.45 57.05
9.25% to 9.49%......................... 1.52 43.02
----- -----
Totals/Wtd. Avg........................ 1.35x 67.40%
===== =====
</TABLE>
ORIGINAL TERM TO SCHEDULED MATURITY
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
RANGE OF % OF CUMULATIVE ---------------------
ORIGINAL TERMS NUMBER OF TOTAL CUT-OFF INITIAL % OF INITIAL MORTGAGE STATED
TO SCHEDULED MORTGAGE DATE PRINCIPAL MORTGAGE POOL MORTGAGE POOL INTEREST REMAINING
MATURITY (MOS.) LOANS BALANCE BALANCE BALANCE RATE TERM (MO.)
--------------- --------- -------------- ------------- ------------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
0 to 107............................. 3 $ 20,306,934 2.22% 2.22% 8.878% 59
108 to 119............................. 1 9,975,377 1.09 3.31 8.450 115
120 to 143............................. 158 852,778,585 93.23 96.55 8.147 113
144 to 179............................. 3 6,294,536 0.69 97.23 8.136 134
180 to 215............................. 6 14,738,071 1.61 98.84 8.552 131
216 to 239............................. 2 2,586,843 0.28 99.13 7.800 218
>=240.................................. 7 7,980,714 0.87% 100.00 7.837 223
--- ------------ ------ ----- ---
Totals/Wtd. Avg........................ 180 $914,661,061 100.00% 8.169% 113
=== ============ ====== ===== ===
<CAPTION>
WEIGHTED AVERAGES
RANGE OF --------------------
ORIGINAL TERMS U/W
TO SCHEDULED NCF CUT-OFF DATE
MATURITY (MOS.) DSCR LTV RATIO
--------------- ----- ------------
<S> <C> <C>
0 to 107............................. 1.29x 67.59
108 to 119............................. 1.31 68.11
120 to 143............................. 1.35 67.69
144 to 179............................. 1.31 71.58
180 to 215............................. 1.21 50.94
216 to 239............................. 1.86 60.38
>=240.................................. 1.36 64.91
----- -----
Totals/Wtd. Avg........................ 1.35x 67.40%
===== =====
</TABLE>
MORTGAGE LOAN SEASONING
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
% OF CUMULATIVE ---------------------
NUMBER OF TOTAL CUT-OFF INITIAL % OF INITIAL MORTGAGE STATED
MORTGAGE DATE PRINCIPAL MORTGAGE POOL MORTGAGE POOL INTEREST REMAINING
SEASONING (MOS.) LOANS BALANCE BALANCE BALANCE RATE TERM (MO.)
---------------- --------- -------------- ------------- ------------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
0 to 5............................... 68 $388,422,718 42.47% 42.47% 8.144% 118
6 to 11............................... 49 357,132,347 39.05 81.51 8.264 111
12 to 17............................... 31 106,714,719 11.67 93.18 8.054 108
18 to 23............................... 9 8,435,514 0.92 94.10 7.816 157
24 to 35............................... 20 36,865,084 4.03 98.13 7.572 106
>=36................................... 3 17,090,678 1.87% 100.00 8.917% 88
--- ------------ ------ ----- ---
Totals/Wtd. Avg........................ 180 $914,661,061 100.00% 8.169% 113
=== ============ ====== ===== ===
<CAPTION>
WEIGHTED AVERAGES
--------------------
U/W
NCF CUT-OFF DATE
SEASONING (MOS.) DSCR LTV RATIO
---------------- ----- ------------
<S> <C> <C>
0 to 5............................... 1.28x 71.05%
6 to 11............................... 1.42 63.99
12 to 17............................... 1.30 70.14
18 to 23............................... 1.80 56.24
24 to 35............................... 1.38 65.75
>=36................................... 1.32 47.62
----- -----
Totals/Wtd. Avg........................ 1.35x 67.40%
===== =====
</TABLE>
A-4
<PAGE> 186
REMAINING TERMS TO SCHEDULED MATURITY
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
TOTAL % OF INITIAL CUMULATIVE ---------------------------------------------
RANGE OF REMAINING NUMBER OF CUT-OFF DATE MORTGAGE % OF INITIAL MORTGAGE STATED U/W
TERMS TO SCHEDULED MORTGAGE PRINCIPAL POOL MORTGAGE POOL INTEREST REMAINING NCF CUT-OFF DATE
MATURITY (MOS.) LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------------ --------- ------------ ------------ ------------- -------- ----------- ----- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
0 to 83............ 5 $ 29,252,248 3.20% 3.20% 8.922% 64 1.35x 61.40%
84 to 107............ 44 135,884,226 14.86 18.05 7.990 102 1.33 67.96
108 to 119............ 108 661,050,043 72.27 90.33 8.189 115 1.35 67.61
120 to 143............ 9 71,314,279 7.80 98.12 8.055 121 1.32 68.59
144 to 179............ 4 5,440,058 0.59 98.72 8.173 165 1.35 52.69
180 to 215............ 2 2,408,798 0.26 98.98 7.917 201 1.57 59.82
216 to 239............ 8 9,311,408 1.02 100.00 7.900 223 1.43 64.86
--- ------------ ------ ----- --- ----- -----
Totals/Wtd.
Avg............. 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ===== =====
</TABLE>
PREPAYMENT PREMIUM
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
TOTAL % OF INITIAL MAXIMUM -----------------------------------------------
NUMBER OF CUT-OFF DATE MORTGAGE CUT-OFF DATE MORTGAGE STATED U/W
MORTGAGE PRINCIPAL POOL PRINCIPAL INTEREST REMAINING NCF CUT-OFF DATE
PREPAYMENT PREMIUM LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------------ --------- ------------ ------------ ------------ -------- ----------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Lockout/
Defeasance......... 130 $824,108,656 90.10% $119,577,993 8.170% 114 1.34x 68.07%
Lockout/> of YM or
1%................. 46 70,222,273 7.68 5,679,549 7.974 116 1.42 63.98
> of YM or 1%........ 3 18,874,703 2.06 8,343,003 8.869 86 1.30 51.40
Lockout/Declining
Fee................ 1 1,455,429 0.16 1,455,429 7.750 152 1.05 58.22
--- ------------ ------ ----- --- ----- -----
Totals/Wtd.
Avg............ 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ===== =====
</TABLE>
A-5
<PAGE> 187
PREPAYMENT PREMIUM BY MORTGAGE RATE
<TABLE>
<CAPTION>
% OF INITIAL
WEIGHTED AVERAGES MORTGAGE POOL BALANCE
% OF INITIAL --------------------- ---------------------------
NUMBER OF TOTAL MORTGAGE MORTGAGE STATED LOCKOUT LOCKOUT THEN
MORTGAGE CUT-OFF DATE POOL INTEREST REMAINING THEN GREATER OF 1%
MORTGAGE RATE LOANS PRINCIPAL BALANCE BALANCE RATE TERM (MO.) DEFEASANCE OR YLD. MAINT.
---------------------- ------- ----------------- ------------ -------- ---------- ---------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
6.75% to 7.24%........ 1 $ 1,451,686 0.16% 6.750% 95 0.00% 0.16%
7.25% to 7.49%........ 13 31,700,293 3.47 7.312 121 2.27 1.20
7.50% to 7.74%........ 19 93,868,299 10.26 7.623 113 9.31 0.95
7.75% to 7.99%........ 22 198,447,686 21.70 7.883 116 20.74 0.80
8.00% to 8.24%........ 40 174,293,961 19.06 8.098 114 17.50 1.55
8.25% to 8.49%........ 44 239,220,167 26.15 8.374 115 23.65 2.50
8.50% to 8.74%........ 29 94,381,467 10.32 8.598 117 9.61 0.45
8.75% to 8.99%........ 8 58,531,506 6.40 8.830 97 5.51 0.00
9.00% to 9.24%........ 3 22,163,684 2.42 9.097 92 1.51 0.00
9.25% to 9.49%........ 1 602,312 0.07 9.350 76 0.00 0.07
--- ------------ ------ ----- --- ----- -----
Totals/Wtd.
Avg......... 180 $914,661,061 100.00% 8.169% 113 90.10% 7.68%
=== ============ ====== ===== === ===== =====
<CAPTION>
% OF INITIAL
MORTGAGE POOL BALANCE
------------------------------
LOCKOUT
GREATER OF 1% THEN
MORTGAGE RATE AS YLD. MAINT. DECLINING FEE
---------------------- -------------- -------------
<S> <C> <C>
6.75% to 7.24%........ 0.00% 0.00%
7.25% to 7.49%........ 0.00 0.00
7.50% to 7.74%........ 0.00 0.00
7.75% to 7.99%........ 0.00 0.16
8.00% to 8.24%........ 0.00 0.00
8.25% to 8.49%........ 0.00 0.00
8.50% to 8.74%........ 0.26 0.00
8.75% to 8.99%........ 0.89 0.00
9.00% to 9.24%........ 0.91 0.00
9.25% to 9.49%........ 0.00 0.00
---- ----
Totals/Wtd.
Avg......... 2.06% 0.16%
==== ====
</TABLE>
INITIAL LOAN POOL PREPAYMENT RESTRICTIONS COMPOSITION OVER TIME(1)
<TABLE>
<CAPTION>
MONTHS FOLLOWING CUT-OFF DATE
---------------------------------------------------------------------------------
PREPAYMENT RESTRICTION 0 12 24 36 48 60
----------------------------------- ------ ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Remaining Pool Balance(2).......... 100.00% 99.01% 97.92% 96.75% 95.49% 92.64%
Locked(3).......................... 97.80 97.43 97.46 96.15 93.00 90.64
Yield Maintenance.................. 2.20 2.41 2.40 3.71 6.87 9.24
5% premium......................... 0.00 0.15 0.15 0.14 0.13 0.12
4% premium......................... 0.00 0.00 0.00 0.00 0.00 0.00
3% premium......................... 0.00 0.00 0.00 0.00 0.00 0.00
2% premium......................... 0.00 0.00 0.00 0.00 0.00 0.00
1% premium......................... 0.00 0.00 0.00 0.00 0.00 0.00
Open............................... 0.00 0.00 0.00 0.00 0.00 0.00
----------- ----------- ----------- ----------- ----------- -----------
Total...................... 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
=========== =========== =========== =========== =========== ===========
<CAPTION>
MONTHS FOLLOWING CUT-OFF DATE
-----------------------------------------------------
PREPAYMENT RESTRICTION 72 84 96 108
----------------------------------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Remaining Pool Balance(2).......... 90.90% 87.99% 83.48% 71.71%
Locked(3).......................... 91.07 92.12 93.31 91.67
Yield Maintenance.................. 7.92 7.62 6.29 3.58
5% premium......................... 0.00 0.00 0.00 0.00
4% premium......................... 0.11 0.00 0.00 0.00
3% premium......................... 0.00 0.10 0.09 0.00
2% premium......................... 0.00 0.00 0.00 0.09
1% premium......................... 0.00 0.00 0.00 0.00
Open............................... 0.89 0.15 0.31 4.65
----------- ----------- ----------- -----------
Total...................... 100.00% 100.00% 100.00% 100.00%
=========== =========== =========== ===========
</TABLE>
---------------
(1) All numbers, unless otherwise noted, are as a percentage of the total
mortgage pool balance at the specified point in time.
(2) Remaining aggregate mortgage loan pool balance as a percentage of the
initial mortgage pool balance at the specified point in time.
(3) Locked includes loans in defeasance.
A-6
<PAGE> 188
PROPERTY TYPES
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
NUMBER OF TOTAL % OF INITIAL MAXIMUM ---------------------------------
MORTGAGED CUT-OFF DATE MORTGAGE CUT-OFF DATE MORTGAGE STATED U/W
REAL PRINCIPAL POOL PRINCIPAL INTEREST REMAINING NCF CUT-OFF DATE
PROPERTY TYPES PROPERTIES BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
-------------- ---------- ------------ ------------ ------------ -------- ---------- ----- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Office................. 55 $319,768,299 34.96% $ 35,364,183 8.374% 111 1.29x 68.85%
Office (Shadow Rated
BBB-)................ 1 119,577,993 13.07 119,577,993 7.890 114 1.63 53.62
Multifamily............ 40 103,846,773 11.35 15,988,455 7.941 118 1.33 70.11
Anchored Retail........ 15 95,272,425 10.42 18,235,848 7.762 109 1.30 71.24
Industrial............. 15 56,907,246 6.22 16,000,000 8.274 112 1.34 68.53
Mixed Use.............. 11 47,667,302 5.21 11,010,038 8.085 120 1.34 65.97
Single Tenant Retail... 10 34,843,644 3.81 7,095,636 8.182 123 1.21 73.13
Self Storage........... 8 29,518,787 3.23 8,365,375 8.449 112 1.38 68.90
Mobile Home Park....... 3 27,039,989 2.96 22,714,214 7.938 118 1.20 78.26
Office/Industrial...... 10 26,478,174 2.89 6,781,144 8.483 115 1.34 69.20
Shadow Anchored
Retail............... 6 21,410,856 2.34 6,247,050 8.206 115 1.28 74.38
Hotel.................. 3 12,136,926 1.33 9,550,083 8.854 135 1.58 62.97
Unanchored Retail...... 6 11,849,644 1.30 3,391,218 8.284 113 1.25 69.41
Other.................. 1 8,343,003 0.91 8,343,003 9.000 76 1.50 47.67
--- ------------ ------ ----- --- ----- -----
Totals/Wtd. Avg...... 184 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ===== =====
</TABLE>
ENCUMBERED INTEREST
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
NUMBER OF TOTAL % OF INITIAL MAXIMUM ---------------------------------
MORTGAGED CUT-OFF DATE MORTGAGE CUT-OFF DATE MORTGAGE STATED U/W
REAL PRINCIPAL POOL PRINCIPAL INTEREST REMAINING NCF CUT-OFF DATE
PROPERTY TYPES PROPERTIES BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
-------------- ---------- ------------ ------------ ------------ -------- ---------- ----- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ownership.............. 174 $868,697,306 94.97% $119,577,993 8.155% 113 1.35x 67.29%
Ownership in part and
Leasehold in part.... 5 26,448,630 2.89 $ 10,268,535 8.163 114 1.31 70.96
Leasehold.............. 5 19,515,125 2.13 9,550,083 8.786 114 1.39 67.38
--- ------------ ------ ----- --- ----- -----
Totals/Wtd. Avg...... 184 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ===== =====
</TABLE>
CUT-OFF DATE LOAN-TO-VALUE RATIO
<TABLE>
<CAPTION>
CUMULATIVE WEIGHTED AVERAGES
TOTAL % OF INITIAL % OF INITIAL -------------------------------------------
NUMBER OF CUT-OFF DATE MORTGAGE MORTGAGE MORTGAGE STATED U/W
RANGE OF CUT-OFF MORTGAGE PRINCIPAL POOL POOL INTEREST REMAINING NCF CUT-OFF DATE
DATE LTV RATIO LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
---------------- --------- ------------ ------------ ------------ -------- ---------- ---- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
0.00% to 49.99%......... 11 $ 33,693,892 3.68% 3.68% 8.455% 104 1.64x 44.41%
50.00% to 54.99%........ 12 142,974,549 15.63 19.32 7.890 114 1.61 53.55
55.00% to 59.99%........ 10 20,200,672 2.21 21.52 8.018 129 1.47 58.25
60.00% to 64.99%........ 24 96,110,788 10.51 32.03 8.186 116 1.41 63.13
65.00% to 69.99%........ 30 139,290,733 15.23 47.26 8.284 106 1.31 67.98
70.00% to 74.99%........ 65 334,413,819 36.56 83.82 8.310 116 1.25 72.64
75.00% to 79.99%........ 28 147,976,606 16.18 100.00 7.956 112 1.23 77.65
--- ------------ ------ ----- --- ---- -----
Totals/Wtd. Avg....... 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ==== =====
</TABLE>
A-7
<PAGE> 189
UNDERWRITTEN NET CASH FLOW DEBT SERVICE COVERAGE RATIO
<TABLE>
<CAPTION>
CUMULATIVE WEIGHTED AVERAGES
TOTAL % OF INITIAL % OF INITIAL -----------------------------------------------
NUMBER OF CUT-OFF DATE MORTGAGE MORTGAGE MORTGAGE STATED U/W
RANGE OF U/W MORTGAGE PRINCIPAL POOL POOL INTEREST REMAINING NCF CUT-OFF DATE
NCF DSCR (x) LOANS BALANCE BALANCE BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------ --------- ------------ ------------ ------------ -------- ---------- ------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1.00 to 1.09......... 4 $ 13,395,674 1.46% 1.46% 7.897% 122 1.06x 71.05%
1.10 to 1.19......... 9 42,960,948 4.70 6.16 8.361 117 1.16 69.43
1.20 to 1.24......... 38 277,294,558 30.32 36.48 8.165 116 1.23 73.65
1.25 to 1.29......... 49 172,876,198 18.90 55.38 8.287 112 1.27 71.42
1.30 to 1.39......... 38 170,543,779 18.65 74.02 8.275 109 1.33 66.94
1.40 to 1.49......... 17 49,436,546 5.40 79.43 8.142 113 1.43 67.11
1.50 to 1.59......... 11 45,045,636 4.92 84.35 8.225 111 1.54 59.13
1.60 to 1.69......... 5 130,092,445 14.22 98.58 7.891 114 1.63 53.46
1.70 to 1.99......... 4 4,785,603 0.52 99.10 7.173 125 1.81 54.62
2.00 to 3.99......... 5 8,229,673 0.90 100.00 7.915 130 2.71 39.93
--- ------------ ------ ----- --- ---- -----
Totals/Wtd.
Avg.............. 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ==== =====
</TABLE>
SCHEDULED MATURITY DATE/ARD LOAN-TO-VALUE RATIO
<TABLE>
<CAPTION>
WEIGHTED AVERAGES
TOTAL CUMULATIVE ---------------------------------------------
RANGE OF SCHEDULED NUMBER OF CUT-OFF DATE % OF INITIAL % OF INITIAL MORTGAGE STATED U/W
MATURITY DATE/ARD MORTGAGE PRINCIPAL MORTGAGE MORTGAGE INTEREST REMAINING NCF CUT-OFF DATE
LTV RATIO LOANS BALANCE POOL BALANCE POOL BALANCE RATE TERM (MO.) DSCR LTV RATIO
------------------ --------- ----------------- ------------- ------------- -------- ---------- ----- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
0.00% to 4.99%....... 18 $ 35,029,355 3.83% 3.83% 8.095% 155 1.25x 60.32%
5.00% to 24.99%...... 2 2,335,978 0.26 4.09 7.529 98 3.26 25.33
25.00% to 49.99%..... 23 181,431,488 19.84 23.92 7.993 110 1.59 53.93
50.00% to 54.99%..... 16 61,570,249 6.73 30.65 8.265 113 1.39 62.34
55.00% to 59.99%..... 25 88,454,000 9.67 40.32 8.150 113 1.34 66.12
60.00% to 64.99%..... 34 180,246,906 19.71 60.03 8.322 113 1.29 69.98
65.00% to 69.99%..... 51 308,586,400 33.74 93.77 8.221 111 1.26 74.22
70.00% to 74.99%..... 11 57,006,684 6.23 100.00 7.960 112 1.24 78.71
--- ------------ ------ ----- --- ----- -----
Totals/Wtd.
Avg............ 180 $914,661,061 100.00% 8.169% 113 1.35x 67.40%
=== ============ ====== ===== === ===== =====
</TABLE>
A-8
<PAGE> 190
STATES
<TABLE>
<CAPTION>
CUMULATIVE WEIGHTED AVERAGES
NUMBER OF % OF INITIAL % OF INITIAL ---------------------
MORTGAGED TOTAL MORTGAGE MORTGAGE MORTGAGE STATED
REAL CUT-OFF DATE POOL POOL INTEREST REMAINING
STATES PROPERTIES PRINCIPAL BALANCE BALANCE BALANCE RATE TERM (MO.)
------ ---------- ----------------- ------------ ------------ -------- ----------
<S> <C> <C> <C> <C> <C> <C>
Illinois.............. 17 $241,516,982 26.41% 26.41% 7.986% 114
California............ 34 152,100,783 16.63 43.03 8.278 112
Michigan.............. 10 51,426,022 5.62 48.66 8.087 117
Ohio.................. 3 42,894,723 4.69 53.35 8.345 119
Massachusetts......... 5 41,482,031 4.54 57.88 8.469 96
Washington............ 7 38,905,919 4.25 62.14 7.845 111
New York.............. 10 31,165,163 3.41 65.54 8.231 115
Maryland.............. 6 30,059,584 3.29 68.83 8.421 112
New Hampshire......... 5 28,180,874 3.08 71.91 7.988 101
Virginia.............. 2 24,615,772 2.69 74.60 8.073 118
Florida............... 6 23,438,445 2.56 77.16 8.200 113
Minnesota............. 8 19,577,170 2.14 79.30 8.217 126
Connecticut........... 4 16,048,386 1.75 81.06 8.883 112
District Of
Columbia............ 1 15,933,791 1.74 82.80 8.380 112
Arizona............... 7 14,395,799 1.57 84.37 8.241 123
North Carolina........ 3 14,122,071 1.54 85.92 8.349 129
Texas................. 7 13,772,383 1.51 87.42 8.050 115
Nevada................ 6 12,554,156 1.37 88.80 8.184 112
Utah.................. 6 12,367,780 1.35 90.15 8.241 132
Oregon................ 3 11,765,257 1.29 91.44 8.368 109
Puerto Rico........... 1 11,197,298 1.22 92.66 8.540 103
Colorado.............. 4 9,829,178 1.07 93.73 7.779 114
New Mexico............ 4 9,713,701 1.06 94.80 8.493 129
Oklahoma.............. 4 8,336,682 0.91 95.71 8.215 116
Tennessee............. 3 7,973,778 0.87 96.58 8.148 112
Pennsylvania.......... 2 6,261,776 0.68 97.26 8.348 114
Delaware.............. 2 5,439,955 0.59 97.86 8.152 105
Georgia............... 1 4,064,239 0.44 98.30 8.050 109
South Dakota.......... 4 3,970,399 0.43 98.74 7.627 178
New Jersey............ 2 3,817,225 0.42 99.15 8.052 112
Alabama............... 1 2,181,165 0.24 99.39 8.110 117
Idaho................. 1 1,391,114 0.15 99.55 8.350 108
Missouri.............. 1 1,119,278 0.12 99.67 8.200 119
Rhode Island.......... 1 1,036,271 0.11 99.78 7.900 99
Montana............... 1 831,794 0.09 99.87 7.900 99
North Dakota.......... 1 665,633 0.07 99.94 7.350 94
Maine................. 1 508,483 0.06 100.00 7.500 96
--- ------------ ------ ----- ---
Totals/Wtd. Avg..... 184 $914,661,061 100.00% 8.169% 113
=== ============ ====== ===== ===
<CAPTION>
WEIGHTED AVERAGES
----------------------
U/W
NCF CUT-OFF DATE
STATES DSCR LTV RATIO
------ ------- ------------
<S> <C> <C>
Illinois.............. 1.47x 60.46%
California............ 1.40 64.93
Michigan.............. 1.22 75.85
Ohio.................. 1.25 74.63
Massachusetts......... 1.29 69.92
Washington............ 1.25 69.73
New York.............. 1.31 71.05
Maryland.............. 1.29 67.63
New Hampshire......... 1.26 73.12
Virginia.............. 1.24 73.70
Florida............... 1.31 69.34
Minnesota............. 1.34 70.01
Connecticut........... 1.42 64.87
District Of
Columbia............ 1.33 72.76
Arizona............... 1.37 68.86
North Carolina........ 1.27 71.49
Texas................. 1.23 67.25
Nevada................ 1.29 74.41
Utah.................. 1.27 73.39
Oregon................ 1.21 74.94
Puerto Rico........... 1.26 67.58
Colorado.............. 1.16 69.55
New Mexico............ 1.38 71.21
Oklahoma.............. 1.27 72.40
Tennessee............. 1.29 75.29
Pennsylvania.......... 1.25 72.40
Delaware.............. 1.23 60.15
Georgia............... 1.31 75.26
South Dakota.......... 1.30 71.39
New Jersey............ 1.34 66.21
Alabama............... 1.24 77.07
Idaho................. 1.30 71.34
Missouri.............. 1.28 69.95
Rhode Island.......... 1.39 53.42
Montana............... 1.45 63.25
North Dakota.......... 1.50 63.39
Maine................. 1.36 63.56
---- -----
Totals/Wtd. Avg..... 1.35x 67.40%
==== =====
</TABLE>
A-9
<PAGE> 191
(This page intentionally left blank)
A-10
<PAGE> 192
GENERAL MORTGAGED REAL PROPERTY INFORMATION
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN LOAN
NUMBER NUMBER SELLER LOAN / PROPERTY NAME
-----------------------------------------------------------------------------------
<S> <C> <C> <C>
101 6605225 SBRC One Financial Place
102 1 LBNA Medical Mutual of Ohio
103 34 LBNA Jorie Plaza
104 03-0812051 GCM Westland Meadows
105 03-0810413 GCM Stonegate One
106 6603559 SBRC 149 New Montgomery Street
107 8 LBNA 101 West Grand
108 14 LBNA 57 W. Grand
109 28 LBNA 40 West Hubbard
110 3 LBNA South Loop Market Place
111 03-0810092 GCM Granite State Marketplace
112 11483 GCM Pacific Plaza
113 6603432 SBRC Seatac Village Shopping Center
114 4 LBNA Seattle-Mead Industrial Facilities
115 5 LBNA Hamilton Court Apartments
116 03-0812601 GCM Webster Building
117 6604370 SBRC Amerix Building
118 6604594 SBRC 85 Devonshire Street/258-262 Washington Street
119 6602060 SBRC Centro De Distribucion del Norte
120 03-0810405 GCM 801 Boylston Street
121 7 LBNA 29200 Northwestern Highway
-----------------------------------------------------------------------------------
122 03-0810402 GCM Simchik Four Property Portfolio
122a 03-0810402a 100 Market Street
122b 03-0810402b 9 Executive Park Drive
122c 03-0810402c 1255 South Willow Street
122d 03-0810402d 135 Daniel Webster Highway
-----------------------------------------------------------------------------------
123 03-0810401 GCM Four Points Hotel by Sheraton
124 15 LBNA GE / Montgomery Wards
- Col. Springs
125 24 LBNA GE / Montgomery Wards
- Pasadena Tx
126 6603313 SBRC US Storage Centers
127 9 LBNA Traders Tower - Self Park
128 10 LBNA Mabek CO L.P.
129 11312 GCM Burlington Self Storage
130 11358 GCM Boynton Plaza
131 6604816 SBRC 601-609 Mission Street
132 10511 GCM Garden Ridge
133 2010092 GCM 300 West Pratt Street
134 2010093 GCM The GTE Building
135 2010096 GCM Hamlin Court
136 010-00000598 AMCC Telex Building
137 020-00000065 AMCC Charnelton Place Office Building
138 03-0810219 GCM Michael's Plaza
-----------------------------------------------------------------------------------
139 03-0810404 GCM Mountain Vista Apartments
& Cibola Village
139a 03-0810404a Mountain Vista Apartments
139b 03-0810404b Cibola Village
-----------------------------------------------------------------------------------
140 16 LBNA Horizon Health Center
141 03-0812040 GCM 300 West Hubbard Street Building
142 03-0812041 GCM 445 North Wells Street Building
143 03-0810224 GCM Miracle Mile Business Center
144 03-0810256 GCM Folsom Self-Storage
</TABLE>
<TABLE>
<CAPTION>
CONTROL PROPERTY ZIP
NUMBER ADDRESS CITY STATE CODE
-----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
101 440 South LaSalle Street Chicago IL 60605
102 2060 East 9th Street Cleveland OH 44115
103 800-810 Jorie Boulevard Oak Brook IL 60523
104 30600 Van Born Road Westland MI 48186
105 15050 Conference Center Drive Chantilly VA 20151
106 149 New Montgomery Street San Francisco CA 94105
107 101 West Grand Chicago IL 60610
108 57 W. Grand Chicago IL 60610
109 40 West Hubbard Street Chicago IL 60610
110 1245 South Clinton Chicago IL 60607
111 1328 Hooksett Road Hooksett NH 03106
112 1375 Sutter Street San Francisco CA 94109
113 1800 S. 320th Street Federal Way WA 98003
114 811, 835, 855, S. 192nd Street SeaTac WA 98148
115 1030 Charlela Lane Elk Grove Village IL 60007
116 51 N Street, N.E. Washington DC 20002
117 8930 Stanford Boulevard Columbia MD 21045
118 83-89 Devonshire Street; 258-260 Boston MA 02109
Washington Street; 262-268
Washington Street
119 State Road No. 869, Palmas Ward Catano PR 00919
120 801 Boylston Street Boston MA 02164
121 29200 NW Highway Southfield MI 48034
-----------------------------------------------------------------------------------------------------------
122
122a 100 Market Street Portsmouth NH 03801
122b 9 Executive Park Drive Merrimack NH 03054
122c 1255 South Willow Street Manchester NH 03103
122d 135 Daniel Webster Highway Manchester NH 03104
-----------------------------------------------------------------------------------------------------------
123 426 Main Avenue Norwalk CT 06851
124 2420 E. Pikes Peak Avenue Colorado Springs CO 80909
125 2222 Spencer Highway Pasadena TX 77504
126 23711 Crenshaw Boulevard Torrance CA 90505
127 308-326 South Wells Street Chicago IL 60606
128 500 North Field Drive Lake Forest IL 60045
129 35 Ray Avenue Burlington MA 01803
130 133 North Congress Avenue Boynton Beach FL 33426
131 601 - 609 Mission Street San Francisco CA 94105
132 6103 Landmark Center Boulevard Greensboro NC 27407
133 300 West Pratt Street Baltimore MD 21201
134 200 West Ocean Boulevard Long Beach CA 90802
135 930 & 940 Hamlin Court Sunnyvale CA 94089
136 12000 Portland Avenue South Burnsville MN 55337
137 151 West Seventh Avenue Eugene OR 97401
138 10303-10351,10355 & 10357 Riverside CA 92505
Magnolia Avenue
-----------------------------------------------------------------------------------------------------------
139
139a 13110 Constitution Boulevard and Albuquerque NM 87111
1501 Tramway Boulevard N.E.
139b 12400 Montgomery Albuquerque NM 87112
Boulevard, N.E.
-----------------------------------------------------------------------------------------------------------
140 19900 Haggerty Road Livonia MI 48152
141 300 West Hubbard Street Chicago IL 60610
142 445 North Wells Street Chicago IL 60610
143 1310 West Miracle Mile Tucson AZ 85705
144 600 Nesmith Court Folsom CA 95630
</TABLE>
<TABLE>
<CAPTION>
PROPERTY
CONTROL SIZE UNIT
NUMBER COUNTY PROPERTY TYPE PROPERTY SIZE TYPE
------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
101 Cook Office 1,019,325 SF
102 Cuyahoga Office 381,176 SF
103 DuPage Office 191,666 SF
104 Wayne Mobile Home Park 774 Pads
105 Fairfax Office 142,477 SF
106 San Francisco Office 79,750 SF
107 Cook Office/Retail 72,865 SF
108 Cook Office 83,469 SF
109 Cook Office/Retail 12,672 SF
110 Cook Anchored Retail 102,265 SF
111 Merrimack Anchored Retail 249,621 SF
112 San Francisco Office 81,551 SF
113 King Anchored Retail 164,326 SF
114 King Industrial 235,031 SF
115 Cook Multifamily 579 Units
116 NAP Office 136,270 SF
117 Howard Office 154,400 SF
118 Suffolk Office 91,283 SF
119 Palmas Ward Industrial 326,014 SF
120 Suffolk Office/Retail 26,834 SF
121 Oakland Office 111,542 SF
-----------------------------------------------------------------------------------------------
122 93,250 SF
122a Rockingham Office/Retail 50,674 SF
122b Hillsborough Office 27,325 SF
122c Hillsborough Office 7,820 SF
122d Hillsborough Office 7,431 SF
-----------------------------------------------------------------------------------------------
123 Fairfield Full Service Hotel 127 Rooms
124 El Paso Single Tenant Retail 161,986 SF
125 Harris Single Tenant Retail 193,006 SF
126 Los Angeles Self Storage 92,925 SF
127 Cook Other (Self Park) 250,500 SF
128 Lake Office 93,000 SF
129 Middlesex Self Storage 88,430 SF
130 Palm Beach Anchored Retail 97,524 SF
131 San Francisco Office 44,870 SF
132 Guilford Single Tenant Retail 122,400 SF
133 Baltimore Office 60,323 SF
134 Los Angeles Office 107,920 SF
135 Santa Clara Office 42,868 SF
136 Dakota Office/Industrial 114,100 SF
137 Lane Office 57,410 SF
138 Riverside Shadow Anchored Retail 67,788 SF
-----------------------------------------------------------------------------------------------
139 348 Units
139a Bernalillo Multifamily 220 Units
139b Bernalillo Multifamily 128 Units
-----------------------------------------------------------------------------------------------
140 Wayne Office 46,267 SF
141 Cook Office 26,054 SF
142 Cook Office 31,226 SF
143 Pima Industrial 116,391 SF
144 Sacramento Self Storage 117,200 SF
</TABLE>
<TABLE>
<CAPTION>
CONTROL YEAR OCCUPANCY OCCUPANCY AS
NUMBER YEAR BUILT RENOVATED PERCENTAGE OF DATE
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
101 1984 NAP 95% 03/13/00
102 1900 1999 100% 09/30/00
103 1961 1999 100% 11/07/00
104 1985 NAP 99% 08/23/00
105 2000 NAP 100% 09/15/00
106 1907 1999 100% 06/30/00
107 1872 1998 100% 09/30/00
108 1912 1991 100% 09/30/00
109 1950 1991 100% 09/30/00
110 1998 NAP 100% 08/30/00
111 1988 NAP 98% 10/01/00
112 1974 2000 95% 07/13/00
113 1977 1998 100% 06/01/00
114 1998 NAP 100% 09/30/00
115 1977 1997 95% 09/30/00
116 1975 1988 100% 06/30/00
117 1991 1999 100% 08/01/00
118 1905 1999 95% 06/30/00
119 1972 1998 100% 09/22/00
120 1999 NAP 88% 06/30/00
121 1970 1998 100% 11/01/00
--------------------------------------------------------------------------------
122
122a 1999 2000 100% 09/01/00
122b 1982 NAP 100% 06/30/00
122c 1978 NAP 100% 06/30/00
122d 1965 NAP 100% 06/30/00
--------------------------------------------------------------------------------
123 1988 1997 73% 06/30/00
124 1964 1999 100% 08/09/00
125 1967 1989 100% 08/10/00
126 1999 NAP 99% 07/31/00
127 1997 NAP 90% 09/27/00
128 1993 NAP 100% 12/31/99
129 1991 NAP 95% 07/27/00
130 1977 1999 95% 09/11/00
131 1907 1996 100% 08/01/00
132 1998 NAP 100% 07/11/00
133 1870 1990 97% 06/30/00
134 1969 1996 100% 09/19/00
135 1974 1999 100% 08/01/00
136 1984 2000 100% 10/01/00
137 1995 NAP 100% 08/31/00
138 1987 NAP 94% 08/01/00
--------------------------------------------------------------------------------
139
139a 1977 1998 90% 06/30/00
139b 1978 1997 96% 06/30/00
--------------------------------------------------------------------------------
140 1988 1999 100% 06/01/00
141 1905 1991 100% 06/30/00
142 1886 1989 99% 06/30/00
143 1971 1998 100% 09/12/00
144 1999 NAP 89% 07/25/00
</TABLE>
<PAGE> 193
GENERAL MORTGAGED REAL PROPERTY INFORMATION
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN LOAN
NUMBER NUMBER SELLER LOAN / PROPERTY NAME
-----------------------------------------------------------------------------------
<S> <C> <C> <C>
145 6603550 SBRC Arlington Heights Apartments
146 17 LBNA Carriage House Lofts
147 03-0810259 GCM Northpointe Shopping Center
148 03-0810406 GCM 2 Willow Street
149 6604949 SBRC Villa de Mission East
150 9911010085 GCM Calaveras Landing Shopping Center
151 1010091 GCM Healtheon
152 03-0812028 GCM 444 North Wells Street Building
153 03-0810239 GCM 1600 Corporate Center Drive
156 6605190 SBRC Town Green at Wilton Center
154 03-0810417 GCM Little Creek Apartments
155 03-0810177 GCM 271 - 285 East Fordham Road
157 03-0810247 GCM El Dorado Plaza
158 6603687 SBRC Tivoli Gardens Apartments
159 6603102 SBRC 155 Washington Ave
160 6605043 SBRC 370 Convention Way
161 03-0810225 GCM Union Landing Retail Center
162 03-0810251 GCM Briarwood Apartments
163 6604565 SBRC Franklinton Square Shopping Center
164 03-0810191 GCM Conquistador Apartments
165 11432 GCM Greenhill Corporate Center
166 03-0812034 GCM Northridge Apartments
167 03-0812035 GCM Red Coach Village Apartments
168 010-00000563 AMCC K-Mart Shopping Center -
Savannah
169 6603484 SBRC The Cascades
170 03-0812036 GCM The Trane Company Building
171 18 LBNA Chandler's Building
172 010-00000561 AMCC K-Mart Shopping Center -
Nashville
173 010-00000540 AMCC 2150 Joshua's Path
174 010-00000501 AMCC Ver-Sa-Til
175 19 LBNA Springdale Mall
176 20 LBNA Frontier Commons/Global Crossing
177 03-0812019 GCM Wythe Shopping Center
178 010-00000467 AMCC Pencader Corporate Center
179 22 LBNA Watermark Office Building
180 03-0812029 GCM 801 West Diversey Parkway
181 9910010082 GCM Lafayette Business Park
182 11573 GCM Arrow Business Center
183 23 LBNA Palm Haven Mobile Home Park
184 010-00000542 AMCC Cedar Marketplace
185 03-0812603 GCM Crossroads Professional Building
186 25 LBNA Imperial Crown Center
187 HHCC0064 GCM Fran Murphy Building
188 03-0810412 GCM Walgreen's - South Medford
189 03-0810210 GCM Sav-on and Carl's Jr.
190 010-00000595 AMCC The Shops at Enon Springs
191 010-00000617 AMCC Sierra Heartland Senior Apartments
192 10896 GCM Weatherbridge Center Buildings
II and III
</TABLE>
<TABLE>
<CAPTION>
CONTROL PROPERTY ZIP
NUMBER ADDRESS CITY STATE CODE
-----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
145 8655 Arlington Avenue Riverside CA 92503
146 1545 S. State Chicago IL 60605
147 4230-4354 Redondo Beach Boulevard & Torrance CA 90504
17204-17270 Hawthorne Boulevard
148 2 Willow Street Southborough MA 01745
149 5055 East Charleston Boulevard Las Vegas NV 89104
150 30057-81 Industrial Parkway SW Union City CA 94358
151 4600 Patrick Henry Drive Santa Clara CA 95054
152 444 North Wells Street Chicago IL 60610
153 1600 Corporate Center Drive Monterey Park CA 91754
156 101 Old Ridgefield Road and 15 Wilton CT 06897
Hubbard Road
154 496 Bending Creek Road Gates NY 14624
155 271 - 285 East Fordham Road Bronx NY 10458
157 1602, 1702, 1730, 1750, 1790 and El Centro CA 92243
1802 N. Imperial Avenue
158 1010 East Arkansas Lane Arlington TX 76014
159 155 Washington Avenue Albany NY 12210
160 370 Convention Way Redwood City CA 94063
161 30701 - 30791 Dyer Street Union City CA 94587
162 141 Golf Club Road Pleasant Hill CA 94523
163 3364-3382 US Highway 1 Franklinton NC 27525
164 3343 South 1300 East Salt Lake City UT 84106
165 1161 McDermott Drive West Goshen Township PA 19380
166 8114 West Britton Road Oklahoma City OK 73132
167 211 The Post Road Springfield OH 45503
168 1901 East Victory Drive Savannah GA 31404
169 1515 East Silver Springs Boulevard Ocala FL 34470
170 7100 Madison Street Willowbrook IL 60521
171 630 Davis Street Evanston IL 60201
172 1508 Gallatin Road Madison TN 37115
173 2150 Joshua's Path Hauppauge NY 11788
174 18400 West 77th Street Chanhassen MN 55317
175 1600 Boston Road Springfield MA 01129
176 1225 Jefferson Road Rochester NY 14623
177 800 East Main Street Wytheville VA 24382
178 110 Lake Drive Newark DE 19702
179 1600 Watermark Columbus OH 43215
180 801 West Diversey Parkway Chicago IL 60614
181 5151 Lafayette Street/2318 Calle Santa Clara CA 95054
De Luna/ 5122 Calle Del Sol
182 402-446 West Arrow Highway San Dimas CA 91773
183 3301 58th Avenue North St. Petersburg FL 33714
184 14638 & 14658 Cedar Avenue South Apple Valley MN 55124
185 7676 New Hampshire Avenue Takoma Park MD 20783
186 5925 Imperial Parkway Mulberry FL 33860
187 12800 U.S. Highway 1 Juno Beach FL 33408
188 1580 Route 112 South Medford NY 11763
189 688 & 690 East Foothill Boulevard Upland CA 91786
190 494-538 Enon Springs Road East Smyrna TN 37167
191 1994 Shaw Avenue Clovis CA 93611
192 1771 NW Maynard Road and 111 James Cary NC 27513
Jackson Avenue
</TABLE>
<TABLE>
<CAPTION>
PROPERTY
CONTROL SIZE UNIT
NUMBER COUNTY PROPERTY TYPE PROPERTY SIZE TYPE
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
145 Riverside Multifamily 176 Units
146 Cook Multifamily 81 Units
147 Los Angeles Shadow Anchored Retail 51,621 SF
148 Worcester Office 39,984 SF
149 Clark Multifamily 160 Units
150 Alameda Anchored Retail 64,956 SF
151 Santa Clara Office 49,837 SF
152 Cook Office 58,451 SF
153 Los Angeles Office 47,787 SF
156 Fairfield Office/Retail 34,410 SF
154 Monroe Multifamily 199 Units
155 Bronx Single Tenant Retail 18,000 SF
157 Imperial Shadow Anchored Retail 62,767 SF
158 Tarrant Multifamily 200 Units
159 Albany Office 67,768 SF
160 San Mateo Office 21,000 SF
161 Alameda Anchored Retail 38,625 SF
162 Contra Costa Multifamily 64 Units
163 Franklin Anchored Retail 65,366 SF
164 Salt Lake Multifamily 121 Units
165 Chester Office 35,225 SF
166 Oklahoma Multifamily 216 Units
167 Clark Multifamily 136 Units
168 Chatham Anchored Retail 111,043 SF
169 Marion Office 86,951 SF
170 DuPage Office/Industrial 50,157 SF
171 Cook Office 26,342 SF
172 Davidson Single Tenant Retail 103,482 SF
173 Suffolk Office 47,849 SF
174 Hennepin Industrial 107,795 SF
175 Hampden Anchored Retail 103,763 SF
176 Monroe Office/Industrial 64,846 SF
177 Wythe Anchored Retail 100,544 SF
178 New Castle Office 79,184 SF
179 Franklin Office 43,929 SF
180 Cook Unanchored Retail 17,514 SF
181 Santa Clara Industrial 70,200 SF
182 Los Angeles Industrial 96,101 SF
183 Pinellas Mobile Home Park 270 Pads
184 Dakota Unanchored Retail 26,887 SF
185 Montgomery Office 50,745 SF
186 Polk Office 66,568 SF
187 Palm Beach Office/Retail 45,697 SF
188 Suffolk Single Tenant Retail 13,905 SF
189 San Bernardino Anchored Retail 19,747 SF
190 Rutherford Shadow Anchored Retail 32,000 SF
191 Fresno Multifamily 60 Units
192 Wake Office/Retail 50,930 SF
</TABLE>
<TABLE>
<CAPTION>
CONTROL YEAR OCCUPANCY OCCUPANCY AS
NUMBER YEAR BUILT RENOVATED PERCENTAGE OF DATE
----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
145 1986 NAP 95% 07/16/00
146 1898 1997 100% 09/30/00
147 1973 NAP 95% 08/01/00
148 1999 NAP 100% 08/01/00
149 1984 NAP 94% 06/20/00
150 1993 NAP 100% 09/07/00
151 1977 1998 100% 07/11/00
152 1894 1985 100% 06/30/00
153 1985 1999 100% 07/01/00
156 1928 1985 100% 06/30/00
154 1973 1998 96% 10/01/00
155 1999 NAP 100% 06/30/00
157 1992 2000 98% 08/15/00
158 1974 1998 92% 06/15/00
159 1959 1998 100% 07/05/00
160 1986 NAP 100% 08/11/00
161 1999 NAP 100% 08/03/00
162 1973 NAP 98% 09/30/00
163 1999 NAP 98% 09/29/00
164 1971 NAP 96% 08/31/00
165 1999 NAP 100% 08/04/00
166 1983 1999 94% 10/05/00
167 1968 1999 99% 07/10/00
168 1964 1996 100% 08/28/00
169 1977 1997 87% 08/01/00
170 1998 NAP 100% 07/27/00
171 1897 1999 96% 11/01/00
172 1964 1991 100% 07/14/00
173 1989 1998 92% 09/10/00
174 1989 NAP 100% 05/05/00
175 1958 1998 100% 06/29/00
176 1993 NAP 100% 06/13/00
177 1976 1998 100% 07/01/00
178 1989 1999 100% 09/13/00
179 1990 NAP 95% 08/08/00
180 1993 NAP 100% 08/08/00
181 1979 1998 100% 08/14/00
182 1982 NAP 97% 09/15/00
183 1952 NAP 89% 10/01/00
184 1999 NAP 100% 08/01/00
185 1969 1989 93% 08/31/00
186 1985 2000 98% 10/01/00
187 1985 1991 100% 07/13/00
188 1999 NAP 100% 09/29/00
189 1999 NAP 100% 08/31/00
190 1999 NAP 96% 09/15/00
191 1999 NAP 100% 08/01/00
192 1998 NAP 83% 09/07/00
</TABLE>
<PAGE> 194
GENERAL MORTGAGED REAL PROPERTY INFORMATION
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN LOAN
NUMBER NUMBER SELLER LOAN / PROPERTY NAME
-------------------------------------------------------------------------------
<S> <C> <C> <C>
193 6604021 SBRC K-Mart Shopping Center - Salem
194 9904010054 GCM 1201 Sharp Street
195 010-00000612 AMCC RPS Warehouse
196 010-00000583 AMCC 755 & 775 Fiero Lane
197 03-0810241 GCM Redondo Tower Apartments
198 010-00000519 AMCC Plaza II Office Building
199 27 LBNA Fountain Place Apartments
200 010-00000393 AMCC Carriage House Apartment
- Sioux Falls
201 010-00000394 AMCC Carriage House Apartment
- Brookings
202 010-00000392 AMCC Carriage House Apartment
- Pierre
203 9906020004 GCM Pioneer Point Apartments
204 010-00000634 AMCC CVS Harper Center
205 6604917 SBRC K-Mart Shopping Center
- Salt Lake City
206 20003020009 GCM 6396, 6392, 6372 McLeod Drive
207 6605277 SBRC Broadway Plaza Building
208 6605130 SBRC 225 Long Avenue
209 29 LBNA Almond Grand Gurnee
210 03-0812016 GCM Summit/Breckenridge Apartments
211 HHCC0063 GCM Peppertree Apartments
212 03-0812031 GCM Hillmount Apartments
213 010-00000594 AMCC 1500 Renaissance Building
214 010-00000623 AMCC Etinuum Office Building
215 020-00000061 AMCC DHR Office Building
216 03-0812030 GCM Oakwood Manor Apartments
217 03-0812602 GCM Woodbend Apartments
218 010-00000494 AMCC Warminster Shopping Center
219 010-00000276 AMCC PBR II
220 010-00000260 AMCC PBR I
221 03-0810254 GCM U-Stor Chambers Self-Storage
222 03-0810218 GCM 9925-9929 Jefferson Boulevard
223 010-00000470 AMCC 810-812 Fiero Lane
224 010-00000568 AMCC Lab Corp of America
225 30 LBNA Birchbrook Office Park
226 03-0810232 GCM Oro Valley Self Storage
227 010-00000620 AMCC Hillcrest Retail/Office Shopping Center
228 010-00000459 AMCC Cain Drive Warehouses
229 6605203 SBRC Mini-City Self Storage
230 010-00000442 AMCC Macy Building
231 03-0812045a GCM Senate Place Apartments
232 03-0812045b GCM Eastfield Townhouses
233 31 LBNA Kendall Manor Apartments
234 010-00000507 AMCC The Culver Building
235 010-00000491 AMCC Harvard Physicians Building
236 010-00000299 AMCC Lyon Street Retail
237 010-00000360 AMCC 350 Newton Avenue Apartments
238 010-00000522 AMCC Solar Gardens
239 010-00000291 AMCC Quality Suites Albuquerque
240 010-00000603 AMCC Springville Corners
241 010-00000325 AMCC 224-234 East Broad Street
242 20008020012 GCM 6380 McLeod Drive
243 010-00000219 AMCC Black Mountain Point Office Building
244 010-00000627 AMCC Waste Management Building
245 010-00000551 AMCC Silver Lake Plaza
246 010-00000533 AMCC Checkmate Apartments
247 010-00000626 AMCC Creekside Center
248 020-00000030 AMCC Tolt Towne Center
249 010-00000318 AMCC South Fridley Apartments
250 03-0810220 GCM 6668 Owens Drive
251 20006020011 GCM 6320 - 6330 McLeod Drive
252 03-0810627 GCM Rite Aid - Hillside
253 010-00000298 AMCC Howard Johnson Lake Havasu
254 32 LBNA Wickiup Mobile Home & RV Park
255 010-00000480 AMCC 261 East 300 South
</TABLE>
<TABLE>
<CAPTION>
CONTROL ZIP
NUMBER PROPERTY ADDRESS CITY STATE CODE
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
193 2460 Mission Street SE Salem OR 97302
194 1201 South Sharp Street Baltimore MD 21230
195 95 Broderick Street Extension Colonie NY 12205
196 755 & 775 Fiero Lane San Luis Obispo CA 93401
197 425 West Paseo Redondo Tucson AZ 85701
198 1200 Chesterly Drive Yakima WA 98902
199 920 South Washington Avenue Lansing MI 48910
200 4700 South Cliff Avenue Sioux Falls SD 57103
201 1511 8th Street South Brookings SD 57006
202 1300 North Harrison Avenue Pierre SD 57501
203 2760 Mayport Road Atlantic Beach FL 32233
204 23975-24001 Harper Avenue St. Clair Shores MI 48080
205 4600 South 900 East Street Murray UT 84117
206 6396, 6392, 6372 McLeod Drive Las Vegas NV 89120
207 30 East 300 South Salt Lake City UT 84111
208 225 Long Avenue Hillside NJ 07205
209 7501 Grand Avenue Gurnee IL 60031
210 1009-1125 Glen Place Duluth MN 55806
211 2840 Las Vegas Trail Fort Worth TX 76116
212 505 Cherry Street SE Grand Rapids MI 49503
213 1500 Renaissance Boulevard N.E. Albuquerque NM 87107
214 1001 East Main Street Yukon OK 73099
215 315 South Beavercreek Road Oregon City OR 97045
216 547 Cherry Street, SE Grand Rapids MI 49503
217 2106 Waverly Parkway Opelika AL 36801
218 318-356 Old York Road Warminster PA 18974
219 738-746 West 17th Street Costa Mesa CA 92627
220 1638 Placentia Avenue Costa Mesa CA 92626
221 1800 South Chambers Road Aurora CO 80017
222 9925-9929 Jefferson Boulevard Culver City CA 90232
223 810-812 Fiero Lane San Luis Obispo CA 93401
224 212 Cherry Lane New Castle Hundred DE 19720
225 3000 E. Birch Street Brea CA 92621
226 10880 North Mavinee Drive Oro Valley AZ 85737
227 18200 Georgia Avenue Olney MD 20832
228 66 to 126 Cain Drive Brentwood NY 11717
229 6321 Spencer Highway Pasadena TX 77505
230 145-155 North Wolfe Road Sunnyvale CA 94086
231 2620 - 2720 Senate Drive Lansing Township MI 48912
232 1014-1216 Eastfield Road, 2705-2719 Lansing Township MI 48917
Harwick Drive
233 125 S. Kendall Avenue Kalamazoo MI 49006
234 10811 Washington Boulevard Culver City CA 90232
235 4415 South Harvard Avenue Tulsa OK 74135
236 1620-1640 East 1st Street Santa Ana CA 92702
237 350 Newton Avenue Oakland CA 94606
238 3600 & 3610 East Sixth Street Sioux Falls SD 57103
239 5251 San Antonio Drive NE Albuquerque NM 87109
240 786 West 1200 North Springville UT 84663
241 224-234 East Broad Street Westfield NJ 07090
242 6380 McLeod Drive Las Vegas NV 89120
243 9625 Black Mountain Road San Diego CA 92126
244 8111 1st Avenue South Seattle WA 98108
245 291 West Canfield Avenue Coeur D'Alene ID 83814
246 4755 & 4735 Deckow Lane Las Vegas NV 89109
247 3940-3958 Clarksville Highway Nashville TN 37218
248 31722 West Eugene Street Carnation WA 98014
249 1050, 1090, 1120 & 1170 52nd Avenue NE Fridley MN 55421
250 6668 Owens Drive Pleasanton CA 94588
251 6320 - 6330 McLeod Drive Las Vegas NV 89120
252 162-19 Hillside Avenue Jamaica NY 11432
253 335 London Bridge Road Lake Havasu City AZ 86403
254 2015 East Highway 60 Apache Junction AZ 85219
255 261 East 300 South Salt Lake City UT 84111
</TABLE>
<TABLE>
<CAPTION>
PROPERTY
CONTROL PROPERTY SIZE UNIT
NUMBER COUNTY PROPERTY TYPE SIZE TYPE
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
193 Marion Anchored Retail 116,866 SF
194 NAP Office 47,305 SF
195 Albany Industrial 63,633 SF
196 San Luis Obispo Industrial 43,896 SF
197 Pima Multifamily 96 Units
198 Yakima Office 30,680 SF
199 Ingham Multifamily 108 Units
200 Minnehaha Multifamily 30 Units
201 Brookings Multifamily 25 Units
202 Hughes Multifamily 25 Units
203 Duval Multifamily 100 Units
204 Macomb Anchored Retail 24,662 SF
205 Salt Lake Single Tenant Retail 106,880 SF
206 Clark Office 25,042 SF
207 Salt Lake Office 23,440 SF
208 Union Office/Industrial 157,000 SF
209 Lake Single Tenant Retail 13,905 SF
210 St. Louis Multifamily 107 Units
211 Tarrant Multifamily 152 Units
212 Kent Multifamily 101 Units
213 Bernalillo Office/Industrial 36,435 SF
214 Canadian Office 35,501 SF
215 Clackamas Office 32,952 SF
216 Kent Multifamily 96 Units
217 Lee Multifamily 100 Units
218 Bucks Unanchored Retail 28,390 SF
219 Orange Industrial 28,996 SF
220 Orange Office/Industrial 26,163 SF
221 Arapahoe Self Storage 49,900 SF
222 Los Angeles Office/Industrial 38,764 SF
223 San Luis Obispo Office/Industrial 31,682 SF
224 New Castle Office 26,800 SF
225 Orange Office 24,635 SF
226 Pima Self Storage 51,000 SF
227 Montgomery Office/Retail 19,233 SF
228 Suffolk Industrial 49,600 SF
229 Harris Self Storage 91,521 SF
230 Santa Clara Office 21,410 SF
231 Ingham Multifamily 32 Units
232 Ingham Multifamily 32 Units
233 Kalamazoo Multifamily 81 Units
234 Los Angeles Office/Retail 22,849 SF
235 Tulsa Office 30,879 SF
236 Orange Unanchored Retail 19,035 SF
237 Alameda Multifamily 42 Units
238 Minnehaha Multifamily 60 Units
239 Bernalillo Limited Service Hotel 69 Rooms
240 Utah Industrial 34,500 SF
241 Union Office/Retail 9,188 SF
242 Clark Office/Industrial 20,455 SF
243 San Diego Office 34,855 SF
244 King Industrial 20,000 SF
245 Kootenai Shadow Anchored Retail 16,584 SF
246 Clark Multifamily 51 Units
247 Davidson Shadow Anchored Retail 14,800 SF
248 King Anchored Retail 28,464 SF
249 Anoka Multifamily 64 Units
250 Alameda Office 18,683 SF
251 Clark Office/Industrial 15,665 SF
252 Queens Single Tenant Retail 16,079 SF
253 Mohave Limited Service Hotel 47 Rooms
254 Pinal Mobile Home Park 111 Pads
255 Salt Lake Office 23,666 SF
</TABLE>
<TABLE>
<CAPTION>
CONTROL YEAR OCCUPANCY OCCUPANCY AS
NUMBER YEAR BUILT RENOVATED PERCENTAGE OF DATE
----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
193 1969 1998 100% 06/30/00
194 1900 1988 92% 09/01/00
195 1999 NAP 100% 06/05/00
196 1999 NAP 100% 08/31/00
197 1961 1999 98% 08/10/00
198 1999 NAP 96% 07/18/00
199 1963 NAP 98% 09/01/00
200 1990 1995 100% 08/16/00
201 1989 NAP 100% 08/01/00
202 1990 1997 100% 08/01/00
203 1987 NAP 93% 07/25/00
204 1989 1999 100% 08/01/00
205 1967 1994 100% 06/30/00
206 1999 NAP 97% 08/29/00
207 1999 NAP 100% 09/22/00
208 1958 1997 100% 06/30/00
209 1997 NAP 100% 06/16/00
210 1974 1977 97% 06/30/00
211 1970 2000 96% 09/08/00
212 1950 1998 95% 07/27/00
213 1999 NAP 100% 04/14/00
214 1967 2000 100% 08/29/00
215 1995 NAP 100% 09/30/00
216 1926 1998 97% 06/29/00
217 1974 2000 94% 06/01/00
218 1988 NAP 95% 10/01/00
219 1959 NAP 100% 10/01/00
220 1961 1998 100% 09/01/00
221 1999 NAP 98% 06/21/00
222 1959 2000 100% 08/31/00
223 1996 NAP 100% 08/31/00
224 1988 2000 100% 09/30/00
225 1985 NAP 94% 08/03/00
226 1996 NAP 75% 09/26/00
227 1987 NAP 100% 09/13/00
228 1986 NAP 100% 09/25/00
229 1977 1995 75% 06/30/00
230 1985 NAP 100% 09/20/00
231 1969 1999 97% 08/13/00
232 1950 1999 100% 06/25/00
233 1966 NAP 100% 08/01/00
234 1964 1995 100% 08/31/00
235 1980 1996 97% 09/30/00
236 1990 NAP 100% 08/31/00
237 1960 2000 98% 10/01/00
238 1983 1995 90% 09/01/00
239 1996 NAP 73% 06/30/00
240 1999 NAP 100% 09/26/00
241 1910 1992 100% 03/15/00
242 1999 NAP 100% 07/19/00
243 1985 1997 100% 10/01/00
244 1971 1995 100% 07/08/00
245 1999 NAP 100% 08/28/00
246 1984 1995 100% 08/01/00
247 2000 NAP 100% 07/06/00
248 1987 1990 100% 09/01/00
249 1963 1998 98% 08/01/00
250 1982 1998 100% 07/07/00
251 2000 NAP 96% 08/29/00
252 1931 1994 100% 07/05/00
253 1993 NAP 50% 06/30/00
254 1972 NAP 90% 08/10/00
255 1979 1998 100% 03/31/00
</TABLE>
<PAGE> 195
GENERAL MORTGAGED REAL PROPERTY INFORMATION
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN LOAN
NUMBER NUMBER SELLER LOAN / PROPERTY NAME
-------------------------------------------------------------------------------
<S> <C> <C> <C>
256 010-00000316 AMCC Hyde Park Apartments
257 010-00000636 AMCC Hawthorne Business Park
258 03-0810237 GCM Nogales Self Storage
259 03-0810238 GCM Glendale West Self Storage
260 010-00000505 AMCC Lovell Building
261 010-00000441 AMCC Nationwide Insurance Office Building
262 010-00000380 AMCC Attache Building
263 03-0810661 GCM Airport Business Center
264 010-00000555 AMCC Bluebonnet Apartments
265 010-00000534 AMCC 8th Street Apartments
266 33 LBNA E.M. Jorgensen Building
267 020-00000029 AMCC Ralph's Grocery & Deli
268 020-00000055 AMCC Market Square
269 010-00000334 AMCC Blockbuster Video-Salt Lake City
270 010-00000366 AMCC Prudential Wise-McIntire Office Building
271 020-00000023 AMCC Licton Springs Court Apartments
272 010-00000212 AMCC Surgicenter of South Bay
273 010-00000338 AMCC West Fargo Living Center
274 010-00000457 AMCC Edgewood Apartments
275 010-00000321 AMCC Washington/Shepherd Retail Center
276 010-00000020 AMCC Candlewood Apartments
277 010-00000431 AMCC Bishop Lifting Products
278 010-00000382 AMCC 188 State Street
279 010-00000259 AMCC Woodstone Properties
280 010-00000553 AMCC East Gate Manor Apartments
</TABLE>
<TABLE>
<CAPTION>
CONTROL ZIP
NUMBER PROPERTY ADDRESS CITY STATE CODE
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
256 1350, 1352, 1354, 1362 7th Street NW New Brighton MN 55112
257 5893-5899 Raytown Road Raytown MO 64133
258 1120 North Industrial Park Avenue Nogales AZ 85621
259 8049 West Glendale Avenue Glendale AZ 85303
260 9030 Red Branch Road Columbia MD 21045
261 2220 South County Trail (Route 2) East Greenwich RI 02818
262 275 Century Circle Louisville CO 80027
263 611 Access Road Stratford CT 06615
264 100 Bluebonnet Street Stephenville TX 76401
265 210, 214 and 218 South 8th Street Las Vegas NV 89101
266 145 Metro Park Rochester NY 14623
267 2035 4th Avenue Seattle WA 98121
268 1520 24th Street West Billings MT 59102
269 824 & 836 West North Temple Salt Lake City UT 84116
270 4710 Table Mesa Drive Boulder CO 80303
271 9242 Ashworth Avenue North Seattle WA 98103
272 23500 Madison Street Torrance CA 90505
273 1321 14th Avenue East West Fargo ND 58078
274 607 Kenwood Avenue Duluth MN 55811
275 4810 & 4820 Washington Avenue Houston TX 77007
276 123-131 Clinic Drive New Britain CT 06051
277 1410 Harris Street Houston TX 77220
278 188 State Street Portland ME 04101
279 8200-8247 North 116th East Avenue Owasso OK 74055
280 1865 Wilson Avenue St. Paul MN 55119
</TABLE>
<TABLE>
<CAPTION>
PROPERTY
CONTROL PROPERTY SIZE UNIT
NUMBER COUNTY PROPERTY TYPE SIZE TYPE
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
256 Ramsey Multifamily 68 Units
257 Jackson Industrial 41,916 SF
258 Santa Cruz Self Storage 48,377 SF
259 Maricopa Self Storage 56,280 SF
260 Howard Office 20,388 SF
261 Kent Office 11,695 SF
262 Boulder Office 10,300 SF
263 Fairfield Office 24,596 SF
264 Erath Multifamily 80 Units
265 Clark Multifamily 36 Units
266 Monroe Industrial 31,035 SF
267 King Single Tenant Retail 10,997 SF
268 Yellowstone Unanchored Retail 12,533 SF
269 Salt Lake Unanchored Retail 7,975 SF
270 Boulder Office 8,674 SF
271 King Multifamily 16 Units
272 Los Angeles Office 9,330 SF
273 Cass Multifamily 24 Units
274 St. Louis Multifamily 24 Units
275 Harris Anchored Retail 19,069 SF
276 Hartford Multifamily 40 Units
277 Harris Industrial 45,500 SF
278 Cumberland Office/Retail 14,025 SF
279 Tulsa Multifamily 40 Units
280 Ramsey Multifamily 23 Units
</TABLE>
<TABLE>
<CAPTION>
CONTROL YEAR OCCUPANCY OCCUPANCY AS
NUMBER YEAR BUILT RENOVATED PERCENTAGE OF DATE
----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
256 1962 2000 93% 08/01/00
257 1988 NAP 100% 09/05/00
258 1995 NAP 88% 09/01/00
259 1961 1996 95% 09/18/00
260 1986 1997 97% 09/13/00
261 1994 NAP 100% 10/23/00
262 1998 NAP 100% 11/01/00
263 1988 NAP 100% 09/26/00
264 1984 NAP 99% 09/18/00
265 1984 1995 100% 08/01/00
266 1979 1991 100% 10/12/00
267 1926 1994 100% 10/03/00
268 1997 1998 100% 09/30/00
269 1996 1997 100% 08/31/00
270 1979 1995 100% 09/25/00
271 1990 NAP 100% 08/31/00
272 1978 1998 100% 03/17/00
273 1985 NAP 100% 09/30/00
274 1976 1988 100% 08/31/00
275 1955 1985 100% 08/30/00
276 1970 2000 100% 10/01/00
277 1972 1990 100% 01/26/00
278 1915 1997 100% 10/25/00
279 1982 1995 98% 09/01/00
280 1969 1999 91% 08/01/00
</TABLE>
<PAGE> 196
MORTGAGE LOAN BALANCES AND MORTGAGED REAL PROPERTY APPRAISED VALUE INFORMATION
<TABLE>
<CAPTION>
ALLOCATED
% OF TOTAL % OF TOTAL
CUT-OFF CUT-OFF
CONTROL MORTGAGE CUT-OFF DATE DATE ALLOCATED DATE
NUMBER LOAN LOAN / PROPERTY NAME BALANCE BALANCE CUT-OFF BALANCE
SELLER DATE BALANCE
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 119,577,992.90 13.07% 119,577,992.90 13.07%
102 LBNA Medical Mutual of Ohio 35,364,183.34 3.87% 35,364,183.34 3.87%
103 LBNA Jorie Plaza 22,800,000.00 2.49% 22,800,000.00 2.49%
104 GCM Westland Meadows 22,714,214.38 2.48% 22,714,214.38 2.48%
105 GCM Stonegate One 20,985,980.79 2.29% 20,985,980.79 2.29%
106 SBRC 149 New Montgomery Street 18,809,602.27 2.06% 18,809,602.27 2.06%
107 LBNA 101 West Grand 10,000,000.00 1.09% 10,000,000.00 1.09%
108 LBNA 57 W. Grand 6,000,000.00 0.66% 6,000,000.00 0.66%
109 LBNA 40 West Hubbard 2,500,000.00 0.27% 2,500,000.00 0.27%
110 LBNA South Loop Market Place 18,235,847.93 1.99% 18,235,847.93 1.99%
111 GCM Granite State Marketplace 18,205,496.80 1.99% 18,205,496.80 1.99%
112 GCM Pacific Plaza 16,426,642.13 1.80% 16,426,642.13 1.80%
113 SBRC Seatac Village Shopping Center 16,087,967.31 1.76% 16,087,967.31 1.76%
114 LBNA Seattle-Mead Industrial Facilities 16,000,000.00 1.75% 16,000,000.00 1.75%
115 LBNA Hamilton Court Apartments 15,988,454.53 1.75% 15,988,454.53 1.75%
116 GCM Webster Building 15,933,790.77 1.74% 15,933,790.77 1.74%
117 SBRC Amerix Building 14,401,990.84 1.57% 14,401,990.84 1.57%
118 SBRC 85 Devonshire Street/258-262 Washington Street 13,650,000.00 1.49% 13,650,000.00 1.49%
119 SBRC Centro De Distribucion del Norte 11,197,297.78 1.22% 11,197,297.78 1.22%
120 GCM 801 Boylston Street 11,010,038.21 1.20% 11,010,038.21 1.20%
121 LBNA 29200 Northwestern Highway 10,268,534.52 1.12% 10,268,534.52 1.12%
--------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 9,975,377.47 1.09%
122a 100 Market Street 8,244,531.50 0.90%
122b 9 Executive Park Drive 942,737.43 0.10%
122c 1255 South Willow Street 423,982.44 0.05%
122d 135 Daniel Webster Highway 364,126.10 0.04%
--------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 9,550,083.19 1.04% 9,550,083.19 1.04%
124 LBNA GE / Montgomery Wards 5,966,576.90 0.65% 5,966,576.90 0.65%
- Col. Springs
125 LBNA GE / Montgomery Wards 3,182,174.35 0.35% 3,182,174.35 0.35%
- Pasadena Tx
126 SBRC US Storage Centers 8,365,375.11 0.91% 8,365,375.11 0.91%
127 LBNA Traders Tower - Self Park 8,343,002.93 0.91% 8,343,002.93 0.91%
128 LBNA Mabek CO L.P. 8,145,363.67 0.89% 8,145,363.67 0.89%
129 GCM Burlington Self Storage 7,984,459.40 0.87% 7,984,459.40 0.87%
130 GCM Boynton Plaza 7,679,220.02 0.84% 7,679,220.02 0.84%
131 SBRC 601-609 Mission Street 7,372,988.89 0.81% 7,372,988.89 0.81%
132 GCM Garden Ridge 7,095,636.48 0.78% 7,095,636.48 0.78%
133 GCM 300 West Pratt Street 7,018,345.03 0.77% 7,018,345.03 0.77%
134 GCM The GTE Building 6,877,665.29 0.75% 6,877,665.29 0.75%
135 GCM Hamlin Court 6,810,392.89 0.74% 6,810,392.89 0.74%
136 AMCC Telex Building 6,781,144.09 0.74% 6,781,144.09 0.74%
137 AMCC Charnelton Place Office Building 6,709,489.20 0.73% 6,709,489.20 0.73%
138 GCM Michael's Plaza 6,247,050.40 0.68% 6,247,050.40 0.68%
--------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 5,982,627.15 0.65%
& Cibola Village
139a Mountain Vista Apartments 3,938,562.88 0.43%
139b Cibola Village 2,044,064.27 0.22%
--------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 5,836,517.68 0.64% 5,836,517.68 0.64%
141 GCM 300 West Hubbard Street Building 3,535,350.48 0.39% 3,535,350.48 0.39%
142 GCM 445 North Wells Street Building 2,206,700.06 0.24% 2,206,700.06 0.24%
143 GCM Miracle Mile Business Center 5,679,548.69 0.62% 5,679,548.69 0.62%
144 GCM Folsom Self-Storage 5,591,013.15 0.61% 5,591,013.15 0.61%
</TABLE>
<TABLE>
<CAPTION>
ALLOCATED CROSS CROSS COLLATER-
CUT-OFF COLLATER- ALIZED MORTGAGE
DATE ALIZED LOAN GROUP
CONTROL MORTGAGE BALANCE LOAN BALANCE AT (MORTGAGE AGGREGATE CUT-
NUMBER LOAN LOAN / PROPERTY NAME PER UNIT MATURITY / ARD LOAN GROUP) OFF DATE BALANCE
SELLER
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 117 107,023,577.63 No 119,577,993
102 LBNA Medical Mutual of Ohio 92.78 31,934,404.04 No 35,364,183
103 LBNA Jorie Plaza 119 20,543,305.72 No 22,800,000
104 GCM Westland Meadows 29,347 20,237,229.11 No 22,714,214
105 GCM Stonegate One 147 18,784,449.23 No 20,985,981
106 SBRC 149 New Montgomery Street 236 17,241,569.01 No 18,809,602
107 LBNA 101 West Grand 137 8,852,255.85 Yes (L1) 18,500,000
108 LBNA 57 W. Grand 71.88 5,306,065.10 Yes (L1) 18,500,000
109 LBNA 40 West Hubbard 197 2,201,415.82 Yes (L1) 18,500,000
110 LBNA South Loop Market Place 178 16,027,421.10 No 18,235,848
111 GCM Granite State Marketplace 72.93 16,475,216.12 No 18,205,497
112 GCM Pacific Plaza 201 14,856,140.26 No 16,426,642
113 SBRC Seatac Village Shopping Center 97.90 14,379,170.94 No 16,087,967
114 LBNA Seattle-Mead Industrial Facilities 68.08 14,346,179.33 No 16,000,000
115 LBNA Hamilton Court Apartments 27,614 14,179,312.03 No 15,988,455
116 GCM Webster Building 117 14,435,723.39 No 15,933,791
117 SBRC Amerix Building 93.28 12,174,183.42 No 14,401,991
118 SBRC 85 Devonshire Street/258-262 Washington Street 150 13,393,160.23 No 13,650,000
119 SBRC Centro De Distribucion del Norte 34.35 8,267,091.48 No 11,197,298
120 GCM 801 Boylston Street 410 8,641,402.47 No 11,010,038
121 LBNA 29200 Northwestern Highway 92.06 9,253,368.97 No 10,268,535
------------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 9,030,561.21 No 9,975,377
122a 100 Market Street 163
122b 9 Executive Park Drive 34.50
122c 1255 South Willow Street 54.22
122d 135 Daniel Webster Highway 49.00
------------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 75,198 8,166,373.14 No 9,550,083
124 LBNA GE / Montgomery Wards 36.83 60,952.39 Yes (L2) 9,148,751
- Col. Springs
125 LBNA GE / Montgomery Wards 16.49 32,507.94 Yes (L2) 9,148,751
- Pasadena Tx
126 SBRC US Storage Centers 90.02 7,068,356.30 No 8,365,375
127 LBNA Traders Tower - Self Park 33.31 7,364,596.26 No 8,343,003
128 LBNA Mabek CO L.P. 87.58 330,965.50 No 8,145,364
129 GCM Burlington Self Storage 90.29 7,245,063.89 No 7,984,459
130 GCM Boynton Plaza 78.74 6,891,403.27 No 7,679,220
131 SBRC 601-609 Mission Street 164 6,652,916.02 No 7,372,989
132 GCM Garden Ridge 57.97 6,410,871.89 No 7,095,636
133 GCM 300 West Pratt Street 116 6,316,486.79 No 7,018,345
134 GCM The GTE Building 63.73 6,199,267.50 No 6,877,665
135 GCM Hamlin Court 159 6,196,874.77 No 6,810,393
136 AMCC Telex Building 59.43 6,186,090.30 No 6,781,144
137 AMCC Charnelton Place Office Building 117 6,079,590.97 No 6,709,489
138 GCM Michael's Plaza 92.16 5,626,103.89 No 6,247,050
------------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 5,440,167.14 No 5,982,627
& Cibola Village
139a Mountain Vista Apartments 17,903
139b Cibola Village 15,969
------------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 126 5,300,891.15 No 5,836,518
141 GCM 300 West Hubbard Street Building 136 3,203,659.77 Yes (G1) 5,742,051
142 GCM 445 North Wells Street Building 70.67 1,997,455.92 Yes (G1) 5,742,051
143 GCM Miracle Mile Business Center 48.80 5,131,700.85 No 5,679,549
144 GCM Folsom Self-Storage 47.70 5,061,310.68 No 5,591,013
</TABLE>
<TABLE>
<CAPTION>
RELATED
MORTGAGE LOAN
RELATED GROUP AGGREGATE
CONTROL MORTGAGE (MORTGAGE CUT-OFF DATE OWNERSHIP
NUMBER LOAN LOAN / PROPERTY NAME LOAN GROUP) BALANCE INTEREST
SELLER
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
101 SBRC One Financial Place No 119,577,993 Fee Simple
102 LBNA Medical Mutual of Ohio No 35,364,183 Fee Simple
103 LBNA Jorie Plaza No 22,800,000 Fee Simple
104 GCM Westland Meadows No 22,714,214 Fee Simple
105 GCM Stonegate One No 20,985,981 Fee Simple
106 SBRC 149 New Montgomery Street No 18,809,602 Fee Simple
107 LBNA 101 West Grand Yes (L1) 18,500,000 Fee Simple
108 LBNA 57 W. Grand Yes (L1) 18,500,000 Fee Simple
109 LBNA 40 West Hubbard Yes (L1) 18,500,000 Fee Simple
110 LBNA South Loop Market Place No 18,235,848 Fee Simple
111 GCM Granite State Marketplace No 18,205,497 Fee Simple
112 GCM Pacific Plaza No 16,426,642 Fee Simple
113 SBRC Seatac Village Shopping Center No 16,087,967 Fee Simple
114 LBNA Seattle-Mead Industrial Facilities No 16,000,000 Fee Simple
115 LBNA Hamilton Court Apartments No 15,988,455 Fee Simple
116 GCM Webster Building No 15,933,791 Fee Simple
117 SBRC Amerix Building No 14,401,991 Fee Simple
118 SBRC 85 Devonshire Street/258-262 Washington Street No 13,650,000 Fee Simple
119 SBRC Centro De Distribucion del Norte No 11,197,298 Fee Simple
120 GCM 801 Boylston Street No 11,010,038 Fee Simple
121 LBNA 29200 Northwestern Highway No 10,268,535 Part Fee Simple &
Part Leasehold
-------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio No 9,975,377
122a 100 Market Street Fee Simple
122b 9 Executive Park Drive Fee Simple
122c 1255 South Willow Street Fee Simple
122d 135 Daniel Webster Highway Fee Simple
-------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton No 9,550,083 Leasehold
124 LBNA GE / Montgomery Wards Yes (L2) 9,148,751 Fee Simple
- Col. Springs
125 LBNA GE / Montgomery Wards Yes (L2) 9,148,751 Fee Simple
- Pasadena Tx
126 SBRC US Storage Centers No 8,365,375 Fee Simple
127 LBNA Traders Tower - Self Park No 8,343,003 Fee Simple
128 LBNA Mabek CO L.P. No 8,145,364 Fee Simple
129 GCM Burlington Self Storage No 7,984,459 Fee Simple
130 GCM Boynton Plaza No 7,679,220 Fee Simple
131 SBRC 601-609 Mission Street No 7,372,989 Fee Simple
132 GCM Garden Ridge No 7,095,636 Fee Simple
133 GCM 300 West Pratt Street No 7,018,345 Part Fee Simple &
Part Leasehold
134 GCM The GTE Building No 6,877,665 Fee Simple
135 GCM Hamlin Court No 6,810,393 Fee Simple
136 AMCC Telex Building No 6,781,144 Fee Simple
137 AMCC Charnelton Place Office Building No 6,709,489 Fee Simple
138 GCM Michael's Plaza No 6,247,050 Fee Simple
-------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments No 5,982,627
& Cibola Village
139a Mountain Vista Apartments Fee Simple
139b Cibola Village Fee Simple
-------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center No 5,836,518 Fee Simple
141 GCM 300 West Hubbard Street Building Yes (G1) 10,866,696 Fee Simple
142 GCM 445 North Wells Street Building Yes (G1) 10,866,696 Fee Simple
143 GCM Miracle Mile Business Center No 5,679,549 Fee Simple
144 GCM Folsom Self-Storage No 5,591,013 Fee Simple
</TABLE>
<TABLE>
<CAPTION>
CONTROL MORTGAGE APPRAISED APPRAISAL CUT-OFF DATE LTV MATURITY DATE /
NUMBER LOAN LOAN / PROPERTY NAME VALUE DATE RATIO ARD LTV RATIO
SELLER
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 223,000,000 03/01/00 53.62% 47.99%
102 LBNA Medical Mutual of Ohio 47,800,000 08/01/00 73.98% 66.81%
103 LBNA Jorie Plaza 32,500,000 11/01/00 70.15% 63.21%
104 GCM Westland Meadows 29,000,000 08/29/00 78.32% 69.78%
105 GCM Stonegate One 28,400,000 01/01/01 73.89% 66.14%
106 SBRC 149 New Montgomery Street 26,640,000 04/16/00 70.61% 64.72%
107 LBNA 101 West Grand 14,800,000 10/12/00 63.39% 56.06%
108 LBNA 57 W. Grand 9,885,000 10/12/00 63.39% 56.06%
109 LBNA 40 West Hubbard 4,500,000 10/12/00 63.39% 56.06%
110 LBNA South Loop Market Place 22,850,000 09/15/00 79.81% 70.14%
111 GCM Granite State Marketplace 24,000,000 09/01/00 75.86% 68.65%
112 GCM Pacific Plaza 23,800,000 05/22/00 69.02% 62.42%
113 SBRC Seatac Village Shopping Center 23,700,000 07/14/99 67.88% 60.67%
114 LBNA Seattle-Mead Industrial Facilities 22,000,000 08/28/00 72.73% 65.21%
115 LBNA Hamilton Court Apartments 25,900,000 10/25/00 61.73% 54.75%
116 GCM Webster Building 21,900,000 11/09/99 72.76% 65.92%
117 SBRC Amerix Building 19,500,000 01/20/00 63.60% 52.93%
118 SBRC 85 Devonshire Street/258-262 Washington Street 20,000,000 12/16/99 68.25% 66.97%
119 SBRC Centro De Distribucion del Norte 16,570,000 03/01/99 67.58% 49.89%
120 GCM 801 Boylston Street 15,300,000 09/01/00 71.96% 56.48%
121 LBNA 29200 Northwestern Highway 13,100,000 08/11/00 78.39% 70.64%
-------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 14,645,000 68.11% 61.66%
122a 100 Market Street 11,600,000 09/01/00
122b 9 Executive Park Drive 1,650,000 04/12/00
122c 1255 South Willow Street 755,000 04/12/00
122d 135 Daniel Webster Highway 640,000 04/12/00
-------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 15,000,000 03/09/00 63.67% 54.44%
124 LBNA GE / Montgomery Wards 7,500,000 08/09/00 71.75% 0.73%
- Col. Springs
125 LBNA GE / Montgomery Wards 5,250,000 08/10/00 71.75% 0.73%
- Pasadena Tx
126 SBRC US Storage Centers 11,500,000 05/05/99 72.74% 61.46%
127 LBNA Traders Tower - Self Park 17,500,000 09/27/00 47.67% 42.08%
128 LBNA Mabek CO L.P. 17,000,000 09/27/00 47.91% 1.95%
129 GCM Burlington Self Storage 11,450,000 04/21/00 69.73% 63.28%
130 GCM Boynton Plaza 11,000,000 06/09/00 69.81% 62.65%
131 SBRC 601-609 Mission Street 15,800,000 03/20/00 46.66% 42.11%
132 GCM Garden Ridge 9,500,000 07/18/00 74.69% 67.48%
133 GCM 300 West Pratt Street 9,500,000 02/15/00 73.88% 66.49%
134 GCM The GTE Building 9,500,000 03/01/00 72.40% 65.26%
135 GCM Hamlin Court 10,500,000 02/24/00 64.86% 59.02%
136 AMCC Telex Building 9,400,000 02/01/00 72.14% 65.81%
137 AMCC Charnelton Place Office Building 9,000,000 10/08/99 74.55% 67.55%
138 GCM Michael's Plaza 8,075,000 02/14/00 77.36% 69.67%
-------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 8,200,000 72.96% 66.34%
& Cibola Village
139a Mountain Vista Apartments 5,600,000 04/05/00
139b Cibola Village 2,600,000 04/05/00
-------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 8,750,000 06/07/00 66.70% 60.58%
141 GCM 300 West Hubbard Street Building 4,550,000 02/03/00 77.60% 70.29%
142 GCM 445 North Wells Street Building 2,850,000 02/03/00 77.60% 70.29%
143 GCM Miracle Mile Business Center 7,745,000 02/11/00 73.33% 66.26%
144 GCM Folsom Self-Storage 8,450,000 07/01/00 66.17% 59.90%
</TABLE>
<PAGE> 197
MORTGAGE LOAN BALANCES AND MORTGAGED REAL PROPERTY APPRAISED VALUE INFORMATION
<TABLE>
<CAPTION>
ALLOCATED
% OF TOTAL % OF TOTAL
CUT-OFF CUT-OFF
CONTROL MORTGAGE CUT-OFF DATE DATE ALLOCATED DATE
NUMBER LOAN LOAN / PROPERTY NAME BALANCE BALANCE CUT-OFF BALANCE
SELLER DATE BALANCE
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 5,541,084.10 0.61% 5,541,084.10 0.61%
146 LBNA Carriage House Lofts 5,500,000.00 0.60% 5,500,000.00 0.60%
147 GCM Northpointe Shopping Center 5,194,650.01 0.57% 5,194,650.01 0.57%
148 GCM 2 Willow Street 5,191,446.87 0.57% 5,191,446.87 0.57%
149 SBRC Villa de Mission East 5,178,495.88 0.57% 5,178,495.88 0.57%
150 GCM Calaveras Landing Shopping Center 5,173,541.50 0.57% 5,173,541.50 0.57%
151 GCM Healtheon 5,145,165.22 0.56% 5,145,165.22 0.56%
152 GCM 444 North Wells Street Building 5,124,645.67 0.56% 5,124,645.67 0.56%
153 GCM 1600 Corporate Center Drive 5,055,904.72 0.55% 5,055,904.72 0.55%
156 SBRC Town Green at Wilton Center 4,907,937.15 0.54% 4,907,937.15 0.54%
154 GCM Little Creek Apartments 5,044,068.38 0.55% 5,044,068.38 0.55%
155 GCM 271 - 285 East Fordham Road 4,933,554.73 0.54% 4,933,554.73 0.54%
157 GCM El Dorado Plaza 4,420,203.26 0.48% 4,420,203.26 0.48%
158 SBRC Tivoli Gardens Apartments 4,369,641.03 0.48% 4,369,641.03 0.48%
159 SBRC 155 Washington Ave 4,342,309.01 0.47% 4,342,309.01 0.47%
160 SBRC 370 Convention Way 4,270,597.44 0.47% 4,270,597.44 0.47%
161 GCM Union Landing Retail Center 4,232,424.51 0.46% 4,232,424.51 0.46%
162 GCM Briarwood Apartments 4,194,882.97 0.46% 4,194,882.97 0.46%
163 SBRC Franklinton Square Shopping Center 4,183,599.97 0.46% 4,183,599.97 0.46%
164 GCM Conquistador Apartments 4,161,547.16 0.45% 4,161,547.16 0.45%
165 GCM Greenhill Corporate Center 4,089,787.90 0.45% 4,089,787.90 0.45%
166 GCM Northridge Apartments 4,085,920.27 0.45% 4,085,920.27 0.45%
167 GCM Red Coach Village Apartments 4,083,990.44 0.45% 4,083,990.44 0.45%
168 AMCC K-Mart Shopping Center - Savannah 4,064,239.35 0.44% 4,064,239.35 0.44%
169 SBRC The Cascades 3,963,919.71 0.43% 3,963,919.71 0.43%
170 GCM The Trane Company Building 3,894,615.54 0.43% 3,894,615.54 0.43%
171 LBNA Chandler's Building 3,887,453.97 0.43% 3,887,453.97 0.43%
172 AMCC K-Mart Shopping Center - Nashville 3,815,939.49 0.42% 3,815,939.49 0.42%
173 AMCC 2150 Joshua's Path 3,773,850.13 0.41% 3,773,850.13 0.41%
174 AMCC Ver-Sa-Til 3,711,531.69 0.41% 3,711,531.69 0.41%
175 LBNA Springdale Mall 3,646,086.27 0.40% 3,646,086.27 0.40%
176 LBNA Frontier Commons/Global Crossing 3,641,183.51 0.40% 3,641,183.51 0.40%
177 GCM Wythe Shopping Center 3,629,791.06 0.40% 3,629,791.06 0.40%
178 AMCC Pencader Corporate Center 3,603,874.20 0.39% 3,603,874.20 0.39%
179 LBNA Watermark Office Building 3,446,549.32 0.38% 3,446,549.32 0.38%
180 GCM 801 West Diversey Parkway 3,391,218.31 0.37% 3,391,218.31 0.37%
181 GCM Lafayette Business Park 3,383,354.91 0.37% 3,383,354.91 0.37%
182 GCM Arrow Business Center 3,246,693.32 0.35% 3,246,693.32 0.35%
183 LBNA Palm Haven Mobile Home Park 3,192,703.97 0.35% 3,192,703.97 0.35%
184 AMCC Cedar Marketplace 3,175,357.80 0.35% 3,175,357.80 0.35%
185 GCM Crossroads Professional Building 3,144,185.55 0.34% 3,144,185.55 0.34%
186 LBNA Imperial Crown Center 3,100,000.00 0.34% 3,100,000.00 0.34%
187 GCM Fran Murphy Building 3,044,546.48 0.33% 3,044,546.48 0.33%
188 GCM Walgreen's - South Medford 3,006,951.45 0.33% 3,006,951.45 0.33%
189 GCM Sav-on and Carl's Jr. 2,994,591.49 0.33% 2,994,591.49 0.33%
190 AMCC The Shops at Enon Springs 2,884,067.62 0.32% 2,884,067.62 0.32%
191 AMCC Sierra Heartland Senior Apartments 2,843,556.89 0.31% 2,843,556.89 0.31%
192 GCM Weatherbridge Center Buildings II and III 2,842,834.15 0.31% 2,842,834.15 0.31%
</TABLE>
<TABLE>
<CAPTION>
ALLOCATED CROSS CROSS COLLATER-
CUT-OFF COLLATER- ALIZED MORTGAGE
DATE ALIZED LOAN GROUP
CONTROL MORTGAGE BALANCE LOAN BALANCE AT (MORTGAGE AGGREGATE CUT-
NUMBER LOAN LOAN / PROPERTY NAME PER UNIT MATURITY / ARD LOAN GROUP) OFF DATE BALANCE
SELLER
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 31,483 4,957,351.70 No 5,541,084
146 LBNA Carriage House Lofts 67,901 4,932,657.34 No 5,500,000
147 GCM Northpointe Shopping Center 101 4,684,476.44 No 5,194,650
148 GCM 2 Willow Street 130 4,689,327.96 No 5,191,447
149 SBRC Villa de Mission East 32,366 4,625,029.92 No 5,178,496
150 GCM Calaveras Landing Shopping Center 79.65 4,648,782.57 No 5,173,542
151 GCM Healtheon 103 4,623,910.76 No 5,145,165
152 GCM 444 North Wells Street Building 87.67 4,648,886.38 No 5,124,646
153 GCM 1600 Corporate Center Drive 106 4,578,618.92 No 5,055,905
156 SBRC Town Green at Wilton Center 143 4,437,450.57 No 4,907,937
154 GCM Little Creek Apartments 25,347 4,496,994.44 No 5,044,068
155 GCM 271 - 285 East Fordham Road 274 4,485,072.55 No 4,933,555
157 GCM El Dorado Plaza 70.42 3,968,739.20 No 4,420,203
158 SBRC Tivoli Gardens Apartments 21,848 3,939,681.02 No 4,369,641
159 SBRC 155 Washington Ave 64.08 3,653,778.88 No 4,342,309
160 SBRC 370 Convention Way 203 4,071,564.28 No 4,270,597
161 GCM Union Landing Retail Center 110 3,780,072.41 No 4,232,425
162 GCM Briarwood Apartments 65,545 3,727,310.33 No 4,194,883
163 SBRC Franklinton Square Shopping Center 64.00 3,754,628.03 No 4,183,600
164 GCM Conquistador Apartments 34,393 3,767,153.50 No 4,161,547
165 GCM Greenhill Corporate Center 116 3,688,122.92 No 4,089,788
166 GCM Northridge Apartments 18,916 3,664,543.96 No 4,085,920
167 GCM Red Coach Village Apartments 30,029 3,665,231.99 No 4,083,990
168 AMCC K-Mart Shopping Center - Savannah 36.60 3,662,686.85 No 4,064,239
169 SBRC The Cascades 45.59 3,574,308.22 No 3,963,920
170 GCM The Trane Company Building 77.65 3,531,334.99 No 3,894,616
171 LBNA Chandler's Building 148 3,540,839.88 No 3,887,454
172 AMCC K-Mart Shopping Center - Nashville 36.88 3,438,920.50 No 3,815,939
173 AMCC 2150 Joshua's Path 78.87 3,403,259.26 No 3,773,850
174 AMCC Ver-Sa-Til 34.43 3,345,270.03 No 3,711,532
175 LBNA Springdale Mall 35.14 3,276,719.65 No 3,646,086
176 LBNA Frontier Commons/Global Crossing 56.15 3,295,787.06 No 3,641,184
177 GCM Wythe Shopping Center 36.10 3,286,374.38 No 3,629,791
178 AMCC Pencader Corporate Center 45.51 3,256,943.07 No 3,603,874
179 LBNA Watermark Office Building 78.46 3,007,185.62 No 3,446,549
180 GCM 801 West Diversey Parkway 194 3,109,240.20 No 3,391,218
181 GCM Lafayette Business Park 48.20 3,049,717.75 No 3,383,355
182 GCM Arrow Business Center 33.78 2,930,489.34 No 3,246,693
183 LBNA Palm Haven Mobile Home Park 11,825 2,901,913.77 No 3,192,704
184 AMCC Cedar Marketplace 118 2,862,069.39 No 3,175,358
185 GCM Crossroads Professional Building 61.96 2,604,013.03 No 3,144,186
186 LBNA Imperial Crown Center 46.57 2,789,501.14 No 3,100,000
187 GCM Fran Murphy Building 66.62 2,532,797.86 No 3,044,546
188 GCM Walgreen's - South Medford 216 2,496,191.64 No 3,006,951
189 GCM Sav-on and Carl's Jr. 152 2,682,025.64 No 2,994,591
190 AMCC The Shops at Enon Springs 90.13 2,595,404.82 No 2,884,068
191 AMCC Sierra Heartland Senior Apartments 47,393 2,548,408.06 No 2,843,557
192 GCM Weatherbridge Center Buildings II and III 55.82 79,398.11 No 2,842,834
</TABLE>
<TABLE>
<CAPTION>
RELATED
MORTGAGE LOAN
RELATED GROUP AGGREGATE
CONTROL MORTGAGE (MORTGAGE CUT-OFF DATE OWNERSHIP
NUMBER LOAN LOAN / PROPERTY NAME LOAN GROUP) BALANCE INTEREST
SELLER
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments No 5,541,084 Fee Simple
146 LBNA Carriage House Lofts No 5,500,000 Fee Simple
147 GCM Northpointe Shopping Center No 5,194,650 Fee Simple
148 GCM 2 Willow Street No 5,191,447 Fee Simple
149 SBRC Villa de Mission East No 5,178,496 Fee Simple
150 GCM Calaveras Landing Shopping Center No 5,173,542 Fee Simple
151 GCM Healtheon Yes (G5) 8,528,520 Part Fee Simple &
Part Leasehold
152 GCM 444 North Wells Street Building Yes (G1) 10,866,696 Fee Simple
153 GCM 1600 Corporate Center Drive No 5,055,905 Fee Simple
156 SBRC Town Green at Wilton Center No 4,907,937 Leasehold
154 GCM Little Creek Apartments No 5,044,068 Fee Simple
155 GCM 271 - 285 East Fordham Road No 4,933,555 Fee Simple
157 GCM El Dorado Plaza No 4,420,203 Fee Simple
158 SBRC Tivoli Gardens Apartments No 4,369,641 Fee Simple
159 SBRC 155 Washington Ave No 4,342,309 Fee Simple
160 SBRC 370 Convention Way No 4,270,597 Fee Simple
161 GCM Union Landing Retail Center No 4,232,425 Fee Simple
162 GCM Briarwood Apartments No 4,194,883 Fee Simple
163 SBRC Franklinton Square Shopping Center No 4,183,600 Fee Simple
164 GCM Conquistador Apartments No 4,161,547 Fee Simple
165 GCM Greenhill Corporate Center No 4,089,788 Fee Simple
166 GCM Northridge Apartments Yes (G3) 8,169,911 Fee Simple
167 GCM Red Coach Village Apartments Yes (G3) 8,169,911 Fee Simple
168 AMCC K-Mart Shopping Center - Savannah No 4,064,239 Fee Simple
169 SBRC The Cascades No 3,963,920 Fee Simple
170 GCM The Trane Company Building No 3,894,616 Fee Simple
171 LBNA Chandler's Building No 3,887,454 Fee Simple
172 AMCC K-Mart Shopping Center - Nashville No 3,815,939 Fee Simple
173 AMCC 2150 Joshua's Path No 3,773,850 Fee Simple
174 AMCC Ver-Sa-Til No 3,711,532 Fee Simple
175 LBNA Springdale Mall No 3,646,086 Fee Simple
176 LBNA Frontier Commons/Global Crossing No 3,641,184 Fee Simple
177 GCM Wythe Shopping Center No 3,629,791 Fee Simple
178 AMCC Pencader Corporate Center No 3,603,874 Fee Simple
179 LBNA Watermark Office Building No 3,446,549 Fee Simple
180 GCM 801 West Diversey Parkway No 3,391,218 Fee Simple
181 GCM Lafayette Business Park Yes (G5) 8,528,520 Fee Simple
182 GCM Arrow Business Center No 3,246,693 Fee Simple
183 LBNA Palm Haven Mobile Home Park No 3,192,704 Fee Simple
184 AMCC Cedar Marketplace No 3,175,358 Fee Simple
185 GCM Crossroads Professional Building No 3,144,186 Fee Simple
186 LBNA Imperial Crown Center No 3,100,000 Fee Simple
187 GCM Fran Murphy Building No 3,044,546 Fee Simple
188 GCM Walgreen's - South Medford No 3,006,951 Fee Simple
189 GCM Sav-on and Carl's Jr. No 2,994,591 Fee Simple
190 AMCC The Shops at Enon Springs Yes (A1) 4,157,838 Fee Simple
191 AMCC Sierra Heartland Senior Apartments No 2,843,557 Fee Simple
192 GCM Weatherbridge Center Buildings II and III No 2,842,834 Fee Simple
</TABLE>
<TABLE>
<CAPTION>
CONTROL MORTGAGE APPRAISED APPRAISAL CUT-OFF DATE LTV MATURITY DATE/
NUMBER LOAN LOAN / PROPERTY NAME VALUE DATE RATIO ARD LTV RATIO
SELLER
----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 7,070,000 06/10/99 78.37% 70.12%
146 LBNA Carriage House Lofts 8,500,000 10/19/00 64.71% 58.03%
147 GCM Northpointe Shopping Center 7,100,000 07/06/00 73.16% 65.98%
148 GCM 2 Willow Street 7,200,000 06/01/00 72.10% 65.13%
149 SBRC Villa de Mission East 6,650,000 02/21/00 77.87% 69.55%
150 GCM Calaveras Landing Shopping Center 8,700,000 12/30/99 59.47% 53.43%
151 GCM Healtheon 9,800,000 02/10/00 52.50% 47.18%
152 GCM 444 North Wells Street Building 7,000,000 02/03/00 73.21% 66.41%
153 GCM 1600 Corporate Center Drive 7,030,000 05/12/00 71.92% 65.13%
156 SBRC Town Green at Wilton Center 7,000,000 04/24/00 70.11% 63.39%
154 GCM Little Creek Apartments 6,800,000 08/01/00 74.18% 66.13%
155 GCM 271 - 285 East Fordham Road 6,600,000 12/15/99 74.75% 67.96%
157 GCM El Dorado Plaza 6,090,000 07/28/00 72.58% 65.17%
158 SBRC Tivoli Gardens Apartments 6,000,000 10/11/99 70.48% 63.54%
159 SBRC 155 Washington Ave 5,900,000 06/03/99 73.60% 61.93%
160 SBRC 370 Convention Way 7,050,000 04/10/00 60.58% 57.75%
161 GCM Union Landing Retail Center 8,450,000 03/01/00 50.09% 44.73%
162 GCM Briarwood Apartments 6,600,000 07/18/00 63.56% 56.47%
163 SBRC Franklinton Square Shopping Center 5,400,000 12/29/99 77.47% 69.53%
164 GCM Conquistador Apartments 5,340,000 04/22/99 77.93% 70.55%
165 GCM Greenhill Corporate Center 5,600,000 06/15/00 73.03% 65.86%
166 GCM Northridge Apartments 5,280,000 03/22/00 77.38% 69.40%
167 GCM Red Coach Village Apartments 5,300,000 03/08/00 77.06% 69.16%
168 AMCC K-Mart Shopping Center - Savannah 5,400,000 10/21/99 75.26% 67.83%
169 SBRC The Cascades 5,850,000 06/25/99 66.07% 59.57%
170 GCM The Trane Company Building 5,450,000 04/03/00 71.46% 64.80%
171 LBNA Chandler's Building 4,900,000 09/01/00 79.34% 72.26%
172 AMCC K-Mart Shopping Center - Nashville 5,000,000 10/25/99 76.32% 68.78%
173 AMCC 2150 Joshua's Path 5,700,000 08/09/99 66.21% 59.71%
174 AMCC Ver-Sa-Til 5,000,000 07/01/99 74.23% 66.91%
175 LBNA Springdale Mall 5,415,000 02/15/00 67.33% 60.51%
176 LBNA Frontier Commons/Global Crossing 5,100,000 06/01/00 71.40% 64.62%
177 GCM Wythe Shopping Center 5,000,000 11/08/99 72.60% 65.73%
178 AMCC Pencader Corporate Center 6,575,000 04/27/99 54.81% 49.54%
179 LBNA Watermark Office Building 4,400,000 07/01/00 78.33% 68.35%
180 GCM 801 West Diversey Parkway 4,770,000 03/06/00 71.09% 65.18%
181 GCM Lafayette Business Park 8,200,000 11/22/99 41.26% 37.19%
182 GCM Arrow Business Center 4,710,000 07/07/00 68.93% 62.22%
183 LBNA Palm Haven Mobile Home Park 4,100,000 04/26/00 77.87% 70.78%
184 AMCC Cedar Marketplace 4,310,000 08/23/99 73.67% 66.41%
185 GCM Crossroads Professional Building 4,300,000 04/26/00 73.12% 60.56%
186 LBNA Imperial Crown Center 4,600,000 07/01/00 67.39% 60.64%
187 GCM Fran Murphy Building 5,300,000 05/24/00 57.44% 47.79%
188 GCM Walgreen's - South Medford 4,350,000 08/15/00 69.13% 57.38%
189 GCM Sav-on and Carl's Jr. 5,200,000 07/06/00 57.59% 51.58%
190 AMCC The Shops at Enon Springs 3,875,000 06/10/00 74.43% 66.98%
191 AMCC Sierra Heartland Senior Apartments 3,790,000 06/01/00 75.03% 67.24%
192 GCM Weatherbridge Center Buildings II and III 5,200,000 05/25/00 54.67% 1.53%
</TABLE>
<PAGE> 198
MORTGAGE LOAN BALANCES AND MORTGAGED REAL PROPERTY APPRAISED VALUE INFORMATION
<TABLE>
<CAPTION>
ALLOCATED
% OF TOTAL % OF TOTAL
CUT-OFF CUT-OFF
CONTROL MORTGAGE CUT-OFF DATE DATE ALLOCATED DATE
NUMBER LOAN LOAN / PROPERTY NAME BALANCE BALANCE CUT-OFF BALANCE
SELLER DATE BALANCE
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem 2,791,494.14 0.31% 2,791,494.14 0.31%
194 GCM 1201 Sharp Street 2,758,739.76 0.30% 2,758,739.76 0.30%
195 AMCC RPS Warehouse 2,694,185.44 0.29% 2,694,185.44 0.29%
196 AMCC 755 & 775 Fiero Lane 2,688,987.40 0.29% 2,688,987.40 0.29%
197 GCM Redondo Tower Apartments 2,592,863.12 0.28% 2,592,863.12 0.28%
198 AMCC Plaza II Office Building 2,561,221.85 0.28% 2,561,221.85 0.28%
199 LBNA Fountain Place Apartments 2,525,985.85 0.28% 2,525,985.85 0.28%
200 AMCC Carriage House Apartment 1,057,819.54 0.12% 1,057,819.54 0.12%
- Sioux Falls
201 AMCC Carriage House Apartment 802,981.13 0.09% 802,981.13 0.09%
- Brookings
202 AMCC Carriage House Apartment 663,541.26 0.07% 663,541.26 0.07%
- Pierre
203 GCM Pioneer Point Apartments 2,458,055.17 0.27% 2,458,055.17 0.27%
204 AMCC CVS Harper Center 2,448,405.50 0.27% 2,448,405.50 0.27%
205 SBRC K-Mart Shopping Center 2,423,568.25 0.26% 2,423,568.25 0.26%
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 2,415,403.74 0.26% 2,415,403.74 0.26%
207 SBRC Broadway Plaza Building 2,394,273.84 0.26% 2,394,273.84 0.26%
208 SBRC 225 Long Avenue 2,391,797.50 0.26% 2,391,797.50 0.26%
209 LBNA Almond Grand Gurnee 2,386,336.28 0.26% 2,386,336.28 0.26%
210 GCM Summit/Breckenridge Apartments 2,381,344.05 0.26% 2,381,344.05 0.26%
211 GCM Peppertree Apartments 2,363,873.79 0.26% 2,363,873.79 0.26%
212 GCM Hillmount Apartments 2,349,600.74 0.26% 2,349,600.74 0.26%
213 AMCC 1500 Renaissance Building 2,292,601.00 0.25% 2,292,601.00 0.25%
214 AMCC Etinuum Office Building 2,273,696.51 0.25% 2,273,696.51 0.25%
215 AMCC DHR Office Building 2,264,274.12 0.25% 2,264,274.12 0.25%
216 GCM Oakwood Manor Apartments 2,230,129.54 0.24% 2,230,129.54 0.24%
217 GCM Woodbend Apartments 2,181,165.12 0.24% 2,181,165.12 0.24%
218 AMCC Warminster Shopping Center 2,171,988.57 0.24% 2,171,988.57 0.24%
219 AMCC PBR II 1,205,693.31 0.13% 1,205,693.31 0.13%
220 AMCC PBR I 872,075.11 0.10% 872,075.11 0.10%
221 GCM U-Stor Chambers Self-Storage 2,071,653.22 0.23% 2,071,653.22 0.23%
222 GCM 9925-9929 Jefferson Boulevard 1,995,326.85 0.22% 1,995,326.85 0.22%
223 AMCC 810-812 Fiero Lane 1,967,729.90 0.22% 1,967,729.90 0.22%
224 AMCC Lab Corp of America 1,836,081.28 0.20% 1,836,081.28 0.20%
225 LBNA Birchbrook Office Park 1,795,755.67 0.20% 1,795,755.67 0.20%
226 GCM Oro Valley Self Storage 1,716,954.25 0.19% 1,716,954.25 0.19%
227 AMCC Hillcrest Retail/Office Shopping Center 1,696,218.89 0.19% 1,696,218.89 0.19%
228 AMCC Cain Drive Warehouses 1,674,172.07 0.18% 1,674,172.07 0.18%
229 SBRC Mini-City Self Storage 1,664,338.67 0.18% 1,664,338.67 0.18%
230 AMCC Macy Building 1,662,577.79 0.18% 1,662,577.79 0.18%
231 GCM Senate Place Apartments 882,791.27 0.10% 882,791.27 0.10%
232 GCM Eastfield Townhouses 673,315.34 0.07% 673,315.34 0.07%
233 LBNA Kendall Manor Apartments 1,496,527.07 0.16% 1,496,527.07 0.16%
234 AMCC The Culver Building 1,487,285.20 0.16% 1,487,285.20 0.16%
235 AMCC Harvard Physicians Building 1,477,144.13 0.16% 1,477,144.13 0.16%
236 AMCC Lyon Street Retail 1,455,429.06 0.16% 1,455,429.06 0.16%
237 AMCC 350 Newton Avenue Apartments 1,451,685.83 0.16% 1,451,685.83 0.16%
238 AMCC Solar Gardens 1,446,056.89 0.16% 1,446,056.89 0.16%
239 AMCC Quality Suites Albuquerque 1,438,473.02 0.16% 1,438,473.02 0.16%
240 AMCC Springville Corners 1,435,710.47 0.16% 1,435,710.47 0.16%
241 AMCC 224-234 East Broad Street 1,425,427.52 0.16% 1,425,427.52 0.16%
242 GCM 6380 McLeod Drive 1,402,676.26 0.15% 1,402,676.26 0.15%
243 AMCC Black Mountain Point Office Building 1,402,109.92 0.15% 1,402,109.92 0.15%
244 AMCC Waste Management Building 1,393,577.40 0.15% 1,393,577.40 0.15%
245 AMCC Silver Lake Plaza 1,391,114.33 0.15% 1,391,114.33 0.15%
246 AMCC Checkmate Apartments 1,345,548.08 0.15% 1,345,548.08 0.15%
247 AMCC Creekside Center 1,273,770.53 0.14% 1,273,770.53 0.14%
248 AMCC Tolt Towne Center 1,257,845.64 0.14% 1,257,845.64 0.14%
249 AMCC South Fridley Apartments 1,256,148.95 0.14% 1,256,148.95 0.14%
250 GCM 6668 Owens Drive 1,245,345.71 0.14% 1,245,345.71 0.14%
251 GCM 6320 - 6330 McLeod Drive 1,239,024.49 0.14% 1,239,024.49 0.14%
252 GCM Rite Aid - Hillside 1,152,649.05 0.13% 1,152,649.05 0.13%
253 AMCC Howard Johnson Lake Havasu 1,148,369.52 0.13% 1,148,369.52 0.13%
254 LBNA Wickiup Mobile Home & RV Park 1,133,070.73 0.12% 1,133,070.73 0.12%
255 AMCC 261 East 300 South 1,128,824.58 0.12% 1,128,824.58 0.12%
</TABLE>
<TABLE>
<CAPTION>
ALLOCATED CROSS CROSS COLLATER-
CUT-OFF COLLATER- ALIZED MORTGAGE
DATE ALIZED LOAN GROUP
CONTROL MORTGAGE BALANCE LOAN BALANCE AT (MORTGAGE AGGREGATE CUT-
NUMBER LOAN LOAN / PROPERTY NAME PER UNIT MATURITY / ARD LOAN GROUP) OFF DATE BALANCE
SELLER
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem 23.89 2,036,820.22 No 2,791,494
194 GCM 1201 Sharp Street 58.32 2,504,565.71 No 2,758,740
195 AMCC RPS Warehouse 42.34 2,424,556.64 No 2,694,185
196 AMCC 755 & 775 Fiero Lane 61.26 2,456,921.97 No 2,688,987
197 GCM Redondo Tower Apartments 27,009 2,323,637.96 No 2,592,863
198 AMCC Plaza II Office Building 83.48 2,143,321.38 No 2,561,222
199 LBNA Fountain Place Apartments 23,389 2,269,274.88 No 2,525,986
200 AMCC Carriage House Apartment 35,261 0.00 Yes (A6) 2,524,342
- Sioux Falls
201 AMCC Carriage House Apartment 32,119 0.00 Yes (A6) 2,524,342
- Brookings
202 AMCC Carriage House Apartment 26,542 0.00 Yes (A6) 2,524,342
- Pierre
203 GCM Pioneer Point Apartments 24,581 2,240,961.00 No 2,458,055
204 AMCC CVS Harper Center 99.28 2,197,976.72 No 2,448,406
205 SBRC K-Mart Shopping Center 22.68 128,965.76 No 2,423,568
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 96.45 2,195,870.09 No 2,415,404
207 SBRC Broadway Plaza Building 102 2,169,121.33 No 2,394,274
208 SBRC 225 Long Avenue 15.23 2,007,631.81 No 2,391,798
209 LBNA Almond Grand Gurnee 172 2,283,929.47 No 2,386,336
210 GCM Summit/Breckenridge Apartments 22,256 2,006,116.70 No 2,381,344
211 GCM Peppertree Apartments 15,552 2,128,644.62 No 2,363,874
212 GCM Hillmount Apartments 23,263 2,117,943.65 No 2,349,601
213 AMCC 1500 Renaissance Building 62.92 2,088,186.15 No 2,292,601
214 AMCC Etinuum Office Building 64.05 2,069,819.78 No 2,273,697
215 AMCC DHR Office Building 68.71 1,901,880.11 No 2,264,274
216 GCM Oakwood Manor Apartments 23,231 2,010,251.98 No 2,230,130
217 GCM Woodbend Apartments 21,812 1,958,494.26 No 2,181,165
218 AMCC Warminster Shopping Center 76.51 1,834,612.98 No 2,171,989
219 AMCC PBR II 41.58 1,006,683.84 Yes (A7) 2,077,768
220 AMCC PBR I 33.33 729,924.31 Yes (A7) 2,077,768
221 GCM U-Stor Chambers Self-Storage 41.52 1,874,548.25 No 2,071,653
222 GCM 9925-9929 Jefferson Boulevard 51.47 1,810,431.58 No 1,995,327
223 AMCC 810-812 Fiero Lane 62.11 1,532,029.41 No 1,967,730
224 AMCC Lab Corp of America 68.51 1,337,819.84 No 1,836,081
225 LBNA Birchbrook Office Park 72.89 1,628,282.25 No 1,795,756
226 GCM Oro Valley Self Storage 33.67 1,557,172.19 No 1,716,954
227 AMCC Hillcrest Retail/Office Shopping Center 88.19 1,544,396.30 No 1,696,219
228 AMCC Cain Drive Warehouses 33.75 1,422,017.64 No 1,674,172
229 SBRC Mini-City Self Storage 18.19 1,398,516.89 No 1,664,339
230 AMCC Macy Building 77.65 1,381,319.08 No 1,662,578
231 GCM Senate Place Apartments 27,587 797,097.02 Yes (G2) 1,556,107
232 GCM Eastfield Townhouses 21,041 607,954.09 Yes (G2) 1,556,107
233 LBNA Kendall Manor Apartments 18,476 1,358,743.29 No 1,496,527
234 AMCC The Culver Building 65.09 1,347,998.37 No 1,487,285
235 AMCC Harvard Physicians Building 47.84 1,243,900.01 No 1,477,144
236 AMCC Lyon Street Retail 76.46 0.69 No 1,455,429
237 AMCC 350 Newton Avenue Apartments 34,564 1,190,449.05 No 1,451,686
238 AMCC Solar Gardens 24,101 1,206,792.09 No 1,446,057
239 AMCC Quality Suites Albuquerque 20,847 0.00 No 1,438,473
240 AMCC Springville Corners 41.61 1,302,705.26 No 1,435,710
241 AMCC 224-234 East Broad Street 155 961,626.42 No 1,425,428
242 GCM 6380 McLeod Drive 68.57 1,266,383.15 No 1,402,676
243 AMCC Black Mountain Point Office Building 40.23 1,192,271.17 No 1,402,110
244 AMCC Waste Management Building 69.68 1,003,486.28 No 1,393,577
245 AMCC Silver Lake Plaza 83.88 1,262,663.00 No 1,391,114
246 AMCC Checkmate Apartments 26,383 1,223,376.98 No 1,345,548
247 AMCC Creekside Center 86.07 1,154,619.64 No 1,273,771
248 AMCC Tolt Towne Center 44.19 1,052,942.26 No 1,257,846
249 AMCC South Fridley Apartments 19,627 0.00 No 1,256,149
250 GCM 6668 Owens Drive 66.66 1,121,963.01 No 1,245,346
251 GCM 6320 - 6330 McLeod Drive 79.10 1,129,578.61 No 1,239,024
252 GCM Rite Aid - Hillside 71.69 43,283.61 No 1,152,649
253 AMCC Howard Johnson Lake Havasu 24,433 0.00 No 1,148,370
254 LBNA Wickiup Mobile Home & RV Park 10,208 1,020,431.36 No 1,133,071
255 AMCC 261 East 300 South 47.70 934,529.42 No 1,128,825
</TABLE>
<TABLE>
<CAPTION>
RELATED
MORTGAGE LOAN
RELATED GROUP AGGREGATE
CONTROL MORTGAGE (MORTGAGE CUT-OFF DATE OWNERSHIP APPRAISED
NUMBER LOAN LOAN / PROPERTY NAME LOAN GROUP) BALANCE INTEREST VALUE
SELLER
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem No 2,791,494 Fee Simple 3,700,000
194 GCM 1201 Sharp Street No 2,758,740 Part Fee Simple & 3,700,000
Part Leasehold
195 AMCC RPS Warehouse No 2,694,185 Fee Simple 4,050,000
196 AMCC 755 & 775 Fiero Lane Yes (A2) 4,656,717 Fee Simple 3,900,000
197 GCM Redondo Tower Apartments No 2,592,863 Fee Simple 3,800,000
198 AMCC Plaza II Office Building No 2,561,222 Fee Simple 3,590,000
199 LBNA Fountain Place Apartments Yes (L3) 4,022,513 Fee Simple 3,250,000
200 AMCC Carriage House Apartment Yes (A6) 2,524,342 Fee Simple 1,520,000
- Sioux Falls
201 AMCC Carriage House Apartment Yes (A6) 2,524,342 Fee Simple 1,135,000
- Brookings
202 AMCC Carriage House Apartment Yes (A6) 2,524,342 Fee Simple 950,000
- Pierre
203 GCM Pioneer Point Apartments No 2,458,055 Fee Simple 3,100,000
204 AMCC CVS Harper Center No 2,448,406 Fee Simple 3,400,000
205 SBRC K-Mart Shopping Center No 2,423,568 Fee Simple 3,300,000
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive Yes (G6) 5,057,104 Leasehold 3,400,000
207 SBRC Broadway Plaza Building No 2,394,274 Fee Simple 3,400,000
208 SBRC 225 Long Avenue No 2,391,798 Fee Simple 3,615,000
209 LBNA Almond Grand Gurnee No 2,386,336 Fee Simple 3,125,000
210 GCM Summit/Breckenridge Apartments No 2,381,344 Fee Simple 3,225,000
211 GCM Peppertree Apartments No 2,363,874 Fee Simple 3,500,000
212 GCM Hillmount Apartments Yes (G2) 6,135,837 Fee Simple 3,150,000
213 AMCC 1500 Renaissance Building No 2,292,601 Fee Simple 3,100,000
214 AMCC Etinuum Office Building No 2,273,697 Fee Simple 3,055,000
215 AMCC DHR Office Building No 2,264,274 Fee Simple 3,000,000
216 GCM Oakwood Manor Apartments Yes (G2) 6,135,837 Fee Simple 3,150,000
217 GCM Woodbend Apartments No 2,181,165 Fee Simple 2,830,000
218 AMCC Warminster Shopping Center No 2,171,989 Fee Simple 3,050,000
219 AMCC PBR II Yes (A7) 2,077,768 Fee Simple 2,000,000
220 AMCC PBR I Yes (A7) 2,077,768 Fee Simple 1,800,000
221 GCM U-Stor Chambers Self-Storage No 2,071,653 Fee Simple 2,800,000
222 GCM 9925-9929 Jefferson Boulevard No 1,995,327 Fee Simple 3,400,000
223 AMCC 810-812 Fiero Lane Yes (A2) 4,656,717 Fee Simple 3,200,000
224 AMCC Lab Corp of America No 1,836,081 Fee Simple 2,600,000
225 LBNA Birchbrook Office Park No 1,795,756 Fee Simple 2,500,000
226 GCM Oro Valley Self Storage Yes (G4) 3,841,947 Fee Simple 2,650,000
227 AMCC Hillcrest Retail/Office Shopping Center Yes (A3) 2,736,323 Fee Simple 2,800,000
228 AMCC Cain Drive Warehouses No 1,674,172 Fee Simple 2,475,000
229 SBRC Mini-City Self Storage No 1,664,339 Fee Simple 2,600,000
230 AMCC Macy Building No 1,662,578 Fee Simple 7,575,000
231 GCM Senate Place Apartments Yes (G2) 6,135,837 Fee Simple 1,125,000
232 GCM Eastfield Townhouses Yes (G2) 6,135,837 Fee Simple 980,000
233 LBNA Kendall Manor Apartments Yes (L3) 4,022,513 Fee Simple 2,100,000
234 AMCC The Culver Building No 1,487,285 Fee Simple 2,340,000
235 AMCC Harvard Physicians Building No 1,477,144 Fee Simple 2,200,000
236 AMCC Lyon Street Retail No 1,455,429 Fee Simple 2,500,000
237 AMCC 350 Newton Avenue Apartments No 1,451,686 Fee Simple 2,720,000
238 AMCC Solar Gardens No 1,446,057 Fee Simple 1,960,000
239 AMCC Quality Suites Albuquerque Yes (A4) 2,586,843 Fee Simple 2,415,000
240 AMCC Springville Corners No 1,435,710 Fee Simple 1,910,000
241 AMCC 224-234 East Broad Street No 1,425,428 Fee Simple 2,150,000
242 GCM 6380 McLeod Drive Yes (G6) 5,057,104 Leasehold 1,900,000
243 AMCC Black Mountain Point Office Building No 1,402,110 Fee Simple 2,590,000
244 AMCC Waste Management Building No 1,393,577 Fee Simple 2,050,000
245 AMCC Silver Lake Plaza No 1,391,114 Fee Simple 1,950,000
246 AMCC Checkmate Apartments Yes (A8) 2,318,556 Fee Simple 1,890,000
247 AMCC Creekside Center Yes (A1) 4,157,838 Fee Simple 1,718,000
248 AMCC Tolt Towne Center No 1,257,846 Part Fee Simple & 2,040,000
Part Leasehold
249 AMCC South Fridley Apartments Yes (A5) 2,874,888 Fee Simple 2,245,000
250 GCM 6668 Owens Drive No 1,245,346 Fee Simple 3,240,000
251 GCM 6320 - 6330 McLeod Drive Yes (G6) 5,057,104 Leasehold 1,750,000
252 GCM Rite Aid - Hillside No 1,152,649 Fee Simple 1,800,000
253 AMCC Howard Johnson Lake Havasu Yes (A4) 2,586,843 Fee Simple 1,870,000
254 LBNA Wickiup Mobile Home & RV Park No 1,133,071 Fee Simple 1,450,000
255 AMCC 261 East 300 South No 1,128,825 Fee Simple 1,735,000
</TABLE>
<TABLE>
<CAPTION>
CONTROL MORTGAGE APPRAISAL CUT-OFF DATE LTV MATURITY DATE/
NUMBER LOAN LOAN / PROPERTY NAME DATE RATIO ARD LTV RATIO
SELLER
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem 10/20/99 75.45% 55.05%
194 GCM 1201 Sharp Street 07/08/99 74.56% 67.69%
195 AMCC RPS Warehouse 05/01/00 66.52% 59.87%
196 AMCC 755 & 775 Fiero Lane 01/14/00 68.95% 63.00%
197 GCM Redondo Tower Apartments 05/02/00 68.23% 61.15%
198 AMCC Plaza II Office Building 07/01/99 71.34% 59.70%
199 LBNA Fountain Place Apartments 06/22/99 77.72% 69.82%
200 AMCC Carriage House Apartment 09/13/00 70.02% 0.00%
- Sioux Falls
201 AMCC Carriage House Apartment 09/13/00 70.02% 0.00%
- Brookings
202 AMCC Carriage House Apartment 09/12/00 70.02% 0.00%
- Pierre
203 GCM Pioneer Point Apartments 04/13/99 79.29% 72.29%
204 AMCC CVS Harper Center 09/01/00 72.01% 64.65%
205 SBRC K-Mart Shopping Center 05/01/00 73.44% 3.91%
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 01/01/00 71.04% 64.58%
207 SBRC Broadway Plaza Building 04/26/00 70.42% 63.80%
208 SBRC 225 Long Avenue 12/28/99 66.16% 55.54%
209 LBNA Almond Grand Gurnee 06/18/00 76.36% 73.09%
210 GCM Summit/Breckenridge Apartments 11/12/99 73.84% 62.21%
211 GCM Peppertree Apartments 04/01/00 67.54% 60.82%
212 GCM Hillmount Apartments 03/01/00 74.59% 67.24%
213 AMCC 1500 Renaissance Building 02/14/00 73.95% 67.36%
214 AMCC Etinuum Office Building 08/01/00 74.43% 67.75%
215 AMCC DHR Office Building 05/19/99 75.48% 63.40%
216 GCM Oakwood Manor Apartments 03/01/00 70.80% 63.82%
217 GCM Woodbend Apartments 06/01/00 77.07% 69.20%
218 AMCC Warminster Shopping Center 06/01/99 71.21% 60.15%
219 AMCC PBR II 06/20/00 54.68% 45.70%
220 AMCC PBR I 08/19/00 54.68% 45.70%
221 GCM U-Stor Chambers Self-Storage 06/19/00 73.99% 66.95%
222 GCM 9925-9929 Jefferson Boulevard 02/25/00 58.69% 53.25%
223 AMCC 810-812 Fiero Lane 05/21/99 61.49% 47.88%
224 AMCC Lab Corp of America 11/03/99 70.62% 51.45%
225 LBNA Birchbrook Office Park 05/01/00 71.83% 65.13%
226 GCM Oro Valley Self Storage 04/21/00 64.79% 58.76%
227 AMCC Hillcrest Retail/Office Shopping Center 05/15/00 60.58% 55.16%
228 AMCC Cain Drive Warehouses 03/30/99 67.64% 57.46%
229 SBRC Mini-City Self Storage 04/25/00 64.01% 53.79%
230 AMCC Macy Building 10/10/00 21.95% 18.24%
231 GCM Senate Place Apartments 05/16/00 73.92% 66.75%
232 GCM Eastfield Townhouses 05/16/00 73.92% 66.75%
233 LBNA Kendall Manor Apartments 04/01/00 71.26% 64.70%
234 AMCC The Culver Building 06/04/99 63.56% 57.61%
235 AMCC Harvard Physicians Building 06/07/99 67.14% 56.54%
236 AMCC Lyon Street Retail 05/11/00 58.22% 0.00%
237 AMCC 350 Newton Avenue Apartments 06/07/00 53.37% 43.77%
238 AMCC Solar Gardens 07/15/99 73.78% 61.57%
239 AMCC Quality Suites Albuquerque 06/14/00 59.56% 0.00%
240 AMCC Springville Corners 03/16/00 75.17% 68.20%
241 AMCC 224-234 East Broad Street 03/20/00 66.30% 44.73%
242 GCM 6380 McLeod Drive 07/14/00 73.83% 66.65%
243 AMCC Black Mountain Point Office Building 09/08/00 54.14% 46.03%
244 AMCC Waste Management Building 07/06/00 67.98% 48.95%
245 AMCC Silver Lake Plaza 11/01/99 71.34% 64.75%
246 AMCC Checkmate Apartments 07/16/99 71.19% 64.73%
247 AMCC Creekside Center 07/09/00 74.14% 67.21%
248 AMCC Tolt Towne Center 05/30/00 61.66% 51.61%
249 AMCC South Fridley Apartments 08/28/00 55.95% 0.00%
250 GCM 6668 Owens Drive 03/13/00 38.44% 34.63%
251 GCM 6320 - 6330 McLeod Drive 05/01/00 70.80% 64.55%
252 GCM Rite Aid - Hillside 01/06/99 64.04% 2.40%
253 AMCC Howard Johnson Lake Havasu 06/29/00 61.41% 0.00%
254 LBNA Wickiup Mobile Home & RV Park 06/01/00 78.14% 70.37%
255 AMCC 261 East 300 South 04/14/99 65.06% 53.86%
</TABLE>
<PAGE> 199
MORTGAGE LOAN BALANCES AND MORTGAGED REAL PROPERTY APPRAISED VALUE INFORMATION
<TABLE>
<CAPTION>
ALLOCATED ALLOCATED
% OF TOTAL % OF TOTAL CUT-OFF
CUT-OFF CUT-OFF DATE
CONTROL MORTGAGE CUT-OFF DATE DATE ALLOCATED DATE BALANCE
NUMBER LOAN LOAN / PROPERTY NAME BALANCE BALANCE CUT-OFF BALANCE PER UNIT
SELLER DATE BALANCE
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 1,123,751.04 0.12% 1,123,751.04 0.12% 16,526
257 AMCC Hawthorne Business Park 1,119,278.48 0.12% 1,119,278.48 0.12% 26.70
258 GCM Nogales Self Storage 1,077,461.10 0.12% 1,077,461.10 0.12% 22.27
259 GCM Glendale West Self Storage 1,047,531.65 0.11% 1,047,531.65 0.11% 18.61
260 AMCC Lovell Building 1,040,104.09 0.11% 1,040,104.09 0.11% 51.02
261 AMCC Nationwide Insurance Office Building 1,036,270.65 0.11% 1,036,270.65 0.11% 88.61
262 AMCC Attache Building 1,029,447.80 0.11% 1,029,447.80 0.11% 99.95
263 GCM Airport Business Center 988,053.79 0.11% 988,053.79 0.11% 40.17
264 AMCC Bluebonnet Apartments 975,505.19 0.11% 975,505.19 0.11% 12,194
265 AMCC 8th Street Apartments 973,007.92 0.11% 973,007.92 0.11% 27,028
266 LBNA E. M. Jorgensen Building 902,238.79 0.10% 902,238.79 0.10% 29.07
267 AMCC Ralph's Grocery & Deli 880,257.05 0.10% 880,257.05 0.10% 80.05
268 AMCC Market Square 831,794.32 0.09% 831,794.32 0.09% 66.37
269 AMCC Blockbuster Video-Salt Lake City 823,855.65 0.09% 823,855.65 0.09% 103
270 AMCC Prudential Wise-McIntire Office Building 761,499.87 0.08% 761,499.87 0.08% 87.79
271 AMCC Licton Springs Court Apartments 725,049.40 0.08% 725,049.40 0.08% 45,316
272 AMCC Surgicenter of South Bay 673,400.49 0.07% 673,400.49 0.07% 72.18
273 AMCC West Fargo Living Center 665,632.63 0.07% 665,632.63 0.07% 27,735
274 AMCC Edgewood Apartments 652,904.01 0.07% 652,904.01 0.07% 27,204
275 AMCC Washington/Shepherd Retail Center 641,873.72 0.07% 641,873.72 0.07% 33.66
276 AMCC Candlewood Apartments 602,311.53 0.07% 602,311.53 0.07% 15,058
277 AMCC Bishop Lifting Products 574,975.87 0.06% 574,975.87 0.06% 12.64
278 AMCC 188 State Street 508,483.10 0.06% 508,483.10 0.06% 36.26
279 AMCC Woodstone Properties 499,921.46 0.05% 499,921.46 0.05% 12,498
280 AMCC East Gate Manor Apartments 494,988.34 0.05% 494,988.34 0.05% 21,521
</TABLE>
<TABLE>
<CAPTION>
CROSS CROSS COLLATER-
COLLATER- ALIZED MORTGAGE
ALIZED LOAN GROUP RELATED
CONTROL MORTGAGE LOAN BALANCE AT (MORTGAGE AGGREGATE CUT- (MORTGAGE
NUMBER LOAN LOAN / PROPERTY NAME MATURITY / ARD LOAN GROUP) OFF DATE BALANCE LOAN GROUP)
SELLER
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 0.00 No 1,123,751 Yes (A5)
257 AMCC Hawthorne Business Park 1,005,961.71 No 1,119,278 No
258 GCM Nogales Self Storage 977,190.19 No 1,077,461 Yes (G4)
259 GCM Glendale West Self Storage 950,047.13 No 1,047,532 Yes (G4)
260 AMCC Lovell Building 939,328.74 No 1,040,104 Yes (A3)
261 AMCC Nationwide Insurance Office Building 756,091.01 No 1,036,271 No
262 AMCC Attache Building 858,360.20 No 1,029,448 No
263 GCM Airport Business Center 841,317.63 No 988,054 No
264 AMCC Bluebonnet Apartments 825,729.94 No 975,505 No
265 AMCC 8th Street Apartments 884,661.16 No 973,008 Yes (A8)
266 LBNA E. M. Jorgensen Building 821,482.71 No 902,239 No
267 AMCC Ralph's Grocery & Deli 688,075.01 No 880,257 No
268 AMCC Market Square 699,023.22 No 831,794 No
269 AMCC Blockbuster Video-Salt Lake City 690,407.74 No 823,856 No
270 AMCC Prudential Wise-McIntire Office Building 635,789.65 No 761,500 No
271 AMCC Licton Springs Court Apartments 608,496.61 No 725,049 No
272 AMCC Surgicenter of South Bay 493,894.85 No 673,400 No
273 AMCC West Fargo Living Center 482,602.19 No 665,633 No
274 AMCC Edgewood Apartments 0.00 No 652,904 No
275 AMCC Washington/Shepherd Retail Center 0.00 No 641,874 No
276 AMCC Candlewood Apartments 525,385.10 No 602,312 No
277 AMCC Bishop Lifting Products 0.00 No 574,976 No
278 AMCC 188 State Street 368,725.08 No 508,483 No
279 AMCC Woodstone Properties 0.00 No 499,921 No
280 AMCC East Gate Manor Apartments 416,838.44 No 494,988 Yes (A5)
</TABLE>
<TABLE>
<CAPTION>
RELATED
MORTGAGE LOAN
GROUP AGGREGATE
CONTROL MORTGAGE CUT-OFF DATE OWNERSHIP APPRAISED APPRAISAL
NUMBER LOAN LOAN / PROPERTY NAME BALANCE INTEREST VALUE DATE
SELLER
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 2,874,888 Fee Simple 2,800,000 08/28/00
257 AMCC Hawthorne Business Park 1,119,278 Fee Simple 1,600,000 09/05/00
258 GCM Nogales Self Storage 3,841,947 Fee Simple 1,900,000 04/26/00
259 GCM Glendale West Self Storage 3,841,947 Fee Simple 1,650,000 04/24/00
260 AMCC Lovell Building 2,736,323 Fee Simple 1,800,000 06/03/99
261 AMCC Nationwide Insurance Office Building 1,036,271 Fee Simple 1,940,000 03/16/00
262 AMCC Attache Building 1,029,448 Fee Simple 1,900,000 01/28/00
263 GCM Airport Business Center 988,054 Fee Simple 1,550,000 05/06/99
264 AMCC Bluebonnet Apartments 975,505 Fee Simple 1,470,000 09/22/99
265 AMCC 8th Street Apartments 2,318,556 Fee Simple 1,310,000 07/16/99
266 LBNA E. M. Jorgensen Building 902,239 Fee Simple 1,200,000 04/27/00
267 AMCC Ralph's Grocery & Deli 880,257 Fee Simple 1,300,000 09/12/00
268 AMCC Market Square 831,794 Fee Simple 1,315,000 12/02/98
269 AMCC Blockbuster Video-Salt Lake City 823,856 Fee Simple 1,225,000 08/17/00
270 AMCC Prudential Wise-McIntire Office Building 761,500 Fee Simple 1,250,000 01/28/00
271 AMCC Licton Springs Court Apartments 725,049 Fee Simple 1,230,000 05/31/00
272 AMCC Surgicenter of South Bay 673,400 Fee Simple 2,000,000 09/26/00
273 AMCC West Fargo Living Center 665,633 Fee Simple 1,050,000 09/07/00
274 AMCC Edgewood Apartments 652,904 Fee Simple 890,000 03/12/99
275 AMCC Washington/Shepherd Retail Center 641,874 Fee Simple 1,500,000 02/04/00
276 AMCC Candlewood Apartments 602,312 Fee Simple 1,400,000 09/12/00
277 AMCC Bishop Lifting Products 574,976 Fee Simple 1,050,000 02/02/00
278 AMCC 188 State Street 508,483 Fee Simple 800,000 05/16/00
279 AMCC Woodstone Properties 499,921 Fee Simple 1,315,000 06/02/00
280 AMCC East Gate Manor Apartments 2,874,888 Fee Simple 745,000 09/12/99
</TABLE>
<TABLE>
<CAPTION>
CONTROL MORTGAGE CUT-OFF DATE LTV MATURITY DATE /
NUMBER LOAN LOAN / PROPERTY NAME RATIO ARD LTV RATIO
SELLER
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 40.13% 0.00%
257 AMCC Hawthorne Business Park 69.95% 62.87%
258 GCM Nogales Self Storage 56.71% 51.43%
259 GCM Glendale West Self Storage 63.49% 57.58%
260 AMCC Lovell Building 57.78% 52.18%
261 AMCC Nationwide Insurance Office Building 53.42% 38.97%
262 AMCC Attache Building 54.18% 45.18%
263 GCM Airport Business Center 63.75% 54.28%
264 AMCC Bluebonnet Apartments 66.36% 56.17%
265 AMCC 8th Street Apartments 74.28% 67.53%
266 LBNA E. M. Jorgensen Building 75.19% 68.46%
267 AMCC Ralph's Grocery & Deli 67.71% 52.93%
268 AMCC Market Square 63.25% 53.16%
269 AMCC Blockbuster Video-Salt Lake City 67.25% 56.36%
270 AMCC Prudential Wise-McIntire Office Building 60.92% 50.86%
271 AMCC Licton Springs Court Apartments 58.95% 49.47%
272 AMCC Surgicenter of South Bay 33.67% 24.69%
273 AMCC West Fargo Living Center 63.39% 45.96%
274 AMCC Edgewood Apartments 73.36% 0.00%
275 AMCC Washington/Shepherd Retail Center 42.79% 0.00%
276 AMCC Candlewood Apartments 43.02% 37.53%
277 AMCC Bishop Lifting Products 54.76% 0.00%
278 AMCC 188 State Street 63.56% 46.09%
279 AMCC Woodstone Properties 38.02% 0.00%
280 AMCC East Gate Manor Apartments 66.44% 55.95%
</TABLE>
<PAGE> 200
GENERAL MORTGAGE LOAN INFORMATION
<TABLE>
<CAPTION>
Mortgage Mort- Admin- Net Mort- Interest
Control Loan Original gage istrative gage Rate Accrual
Number Seller Loan / Property Name Balance Rate Fee Rate Rate Type Method
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 120,000,000 7.8900% 0.0624% 7.8276% Fixed Actual/360
102 LBNA Medical Mutual of Ohio 35,400,000 8.3800% 0.0624% 8.3176% Fixed Actual/360
103 LBNA Jorie Plaza 22,800,000 8.3300% 0.0624% 8.2676% Fixed Actual/360
104 GCM Westland Meadows 22,730,000 7.8300% 0.1124% 7.7176% Fixed Actual/360
105 GCM Stonegate One 21,000,000 8.0250% 0.0624% 7.9626% Fixed Actual/360
106 SBRC 149 New Montgomery Street 18,900,000 8.8800% 0.0624% 8.8176% Fixed Actual/360
107 LBNA 101 West Grand 10,000,000 7.5900% 0.0624% 7.5276% Fixed Actual/360
108 LBNA 57 W. Grand 6,000,000 7.5500% 0.0624% 7.4876% Fixed Actual/360
109 LBNA 40 West Hubbard 2,500,000 7.3800% 0.0624% 7.3176% Fixed Actual/360
110 LBNA South Loop Market Place 18,250,000 7.2800% 0.0624% 7.2176% Fixed Actual/360
111 GCM Granite State Marketplace 18,540,000 7.7350% 0.0624% 7.6726% Fixed Actual/360
112 GCM Pacific Plaza 16,460,000 8.4000% 0.0924% 8.3076% Fixed Actual/360
113 SBRC Seatac Village Shopping Center 16,250,000 7.5600% 0.0974% 7.4626% Fixed Actual/360
114 LBNA Seattle-Mead Industrial Facilities 16,000,000 8.1200% 0.0624% 8.0576% Fixed Actual/360
115 LBNA Hamilton Court Apartments 16,000,000 7.6400% 0.0624% 7.5776% Fixed Actual/360
116 GCM Webster Building 16,000,000 8.3800% 0.0624% 8.3176% Fixed Actual/360
117 SBRC Amerix Building 14,500,000 8.6600% 0.0624% 8.5976% Fixed Actual/360
118 SBRC 85 Devonshire Street/258-262 Washington Street 13,650,000 8.8200% 0.0924% 8.7276% Fixed Actual/360
119 SBRC Centro De Distribucion del Norte 11,500,000 8.5400% 0.0624% 8.4776% Fixed Actual/360
120 GCM 801 Boylston Street 11,050,000 8.1200% 0.0624% 8.0576% Fixed Actual/360
121 LBNA 29200 Northwestern Highway 10,275,000 8.3150% 0.0624% 8.2526% Fixed Actual/360
------------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 9,985,567.88(b) 8.4500% 0.1224% 8.3276% Fixed Actual/360
122a 100 Market Street
122b 9 Executive Park Drive
122c 1255 South Willow Street
122d 135 Daniel Webster Highway
------------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 9,600,000 9.1400% 0.0624% 9.0776% Fixed Actual/360
124 LBNA GE / Montgomery Wards 6,000,000 7.6600% 0.0624% 7.5976% Fixed Actual/360
- Col. Springs
125 LBNA GE / Montgomery Wards 3,200,000 7.6600% 0.0624% 7.5976% Fixed Actual/360
- Pasadena Tx
126 SBRC US Storage Centers 8,500,000 8.2900% 0.0624% 8.2276% Fixed Actual/360
127 LBNA Traders Tower - Self Park 8,600,000 9.0000% 0.0624% 8.9376% Fixed 30/360
128 LBNA Mabek CO L.P. 11,250,000 8.8000% 0.0624% 8.7376% Fixed Actual/360
129 GCM Burlington Self Storage 8,000,000 8.5500% 0.0924% 8.4576% Fixed Actual/360
130 GCM Boynton Plaza 7,700,000 8.0300% 0.0924% 7.9376% Fixed Actual/360
131 SBRC 601-609 Mission Street 7,400,000 8.2200% 0.0624% 8.1576% Fixed Actual/360
132 GCM Garden Ridge 7,100,000 8.4300% 0.0924% 8.3376% Fixed Actual/360
133 GCM 300 West Pratt Street 7,050,000 8.0800% 0.0924% 7.9876% Fixed Actual/360
134 GCM The GTE Building 6,900,000 8.2000% 0.0924% 8.1076% Fixed Actual/360
135 GCM Hamlin Court 6,830,000 8.6300% 0.0924% 8.5376% Fixed Actual/360
136 AMCC Telex Building 6,800,000 8.7500% 0.0624% 8.6876% Fixed Actual/360
137 AMCC Charnelton Place Office Building 6,750,000 8.3000% 0.0624% 8.2376% Fixed Actual/360
138 GCM Michael's Plaza 6,275,000 8.1100% 0.0624% 8.0476% Fixed Actual/360
------------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 6,000,000 8.6000% 0.0624% 8.5376% Fixed Actual/360
& Cibola Village
139a Mountain Vista Apartments
139b Cibola Village
------------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 5,850,000 8.5650% 0.0624% 8.5026% Fixed Actual/360
141 GCM 300 West Hubbard Street Building 3,550,000 8.3900% 0.0624% 8.3276% Fixed Actual/360
142 GCM 445 North Wells Street Building 2,213,500 8.3900% 0.0624% 8.3276% Fixed Actual/360
143 GCM Miracle Mile Business Center 5,700,000 8.2800% 0.0624% 8.2176% Fixed Actual/360
144 GCM Folsom Self-Storage 5,600,000 8.4700% 0.0624% 8.4076% Fixed Actual/360
</TABLE>
<TABLE>
<CAPTION>
Antici- Sched-
Mortgage First pated uled
Control Loan Loan Payment Grace Repay- Maturity
Number Seller Loan / Property Name Type Note Date Date Period ment Date Date
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place ARD 05/02/00 07/01/00 2 06/01/10 06/01/30
102 LBNA Medical Mutual of Ohio Balloon 09/29/00 11/01/00 5 NAP 10/01/10
103 LBNA Jorie Plaza Balloon 11/22/00 01/01/01 5 NAP 12/01/10
104 GCM Westland Meadows Balloon 10/12/00 12/01/00 5 NAP 11/01/10
105 GCM Stonegate One Balloon 10/11/00 12/01/00 5 NAP 11/01/10
106 SBRC 149 New Montgomery Street Balloon 01/14/00 03/01/00 5 NAP 02/01/10
107 LBNA 101 West Grand Balloon 11/15/00 01/01/01 5 NAP 12/01/10
108 LBNA 57 W. Grand Balloon 11/15/00 01/01/01 5 NAP 12/01/10
109 LBNA 40 West Hubbard Balloon 11/15/00 01/01/01 5 NAP 12/01/10
110 LBNA South Loop Market Place Balloon 10/19/00 12/01/00 5 NAP 11/01/10
111 GCM Granite State Marketplace Balloon 08/19/98 10/01/98 10 NAP 09/01/08
112 GCM Pacific Plaza Balloon 07/21/00 09/01/00 5 NAP 08/01/10
113 SBRC Seatac Village Shopping Center ARD 08/24/99 10/01/99 5 09/01/09 09/01/29
114 LBNA Seattle-Mead Industrial Facilities Balloon 11/13/00 01/01/01 5 NAP 12/01/10
115 LBNA Hamilton Court Apartments Balloon 10/31/00 12/01/00 5 NAP 11/01/10
116 GCM Webster Building Balloon 03/24/00 05/01/00 5 NAP 04/01/10
117 SBRC Amerix Building Balloon 03/02/00 05/01/00 5 NAP 04/01/10
118 SBRC 85 Devonshire Street/258-262 Washington Street Balloon 03/10/00 05/01/00 5 NAP 04/01/05
119 SBRC Centro De Distribucion del Norte Balloon 06/15/99 08/01/99 10 NAP 07/01/09
120 GCM 801 Boylston Street Balloon 08/24/00 10/01/00 5 NAP 09/01/10
121 LBNA 29200 Northwestern Highway Balloon 10/24/00 12/01/00 5 NAP 11/01/10
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio Balloon 06/29/00 11/01/00 10 NAP 07/01/10
122a 100 Market Street
122b 9 Executive Park Drive
122c 1255 South Willow Street
122d 135 Daniel Webster Highway
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton Balloon 04/05/00 06/01/00 5 NAP 05/01/10
124 LBNA GE / Montgomery Wards Full Amort 10/13/00 12/01/00 5 NAP 11/01/10
- Col. Springs
125 LBNA GE / Montgomery Wards Full Amort 10/13/00 12/01/00 5 NAP 11/01/10
- Pasadena Tx
126 SBRC US Storage Centers Balloon 06/29/99 08/01/99 10 NAP 07/01/09
127 LBNA Traders Tower - Self Park Balloon 03/14/97 05/01/97 10 NAP 03/31/07
128 LBNA Mabek CO L.P. Full Amort 04/21/94 06/05/94 5 NAP 05/01/09
129 GCM Burlington Self Storage Balloon 07/31/00 09/01/00 5 NAP 08/01/10
130 GCM Boynton Plaza Balloon 06/30/00 08/01/00 5 NAP 07/01/10
131 SBRC 601-609 Mission Street Balloon 04/28/00 06/01/00 5 NAP 05/01/10
132 GCM Garden Ridge Balloon 10/03/00 12/01/00 5 NAP 11/01/10
133 GCM 300 West Pratt Street Balloon 03/30/00 05/01/00 5 NAP 04/01/10
134 GCM The GTE Building Balloon 05/09/00 07/01/00 5 NAP 06/01/10
135 GCM Hamlin Court Balloon 05/15/00 07/01/00 5 NAP 06/01/10
136 AMCC Telex Building Balloon 05/09/00 07/01/00 5 NAP 06/01/10
137 AMCC Charnelton Place Office Building Balloon 12/23/99 02/01/00 10 NAP 01/01/10
138 GCM Michael's Plaza Balloon 03/22/00 05/01/00 5 NAP 04/01/10
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments Balloon 05/18/00 07/01/00 5 NAP 06/01/10
& Cibola Village
139a Mountain Vista Apartments
139b Cibola Village
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center Balloon 06/29/00 08/01/00 5 NAP 07/01/10
141 GCM 300 West Hubbard Street Building Balloon 04/30/00 05/01/00 5 NAP 04/01/10
142 GCM 445 North Wells Street Building Balloon 04/30/00 07/01/00 5 NAP 06/01/10
143 GCM Miracle Mile Business Center Balloon 04/26/00 06/01/00 5 NAP 05/01/10
144 GCM Folsom Self-Storage Balloon 08/02/00 10/01/00 5 NAP 09/01/10
</TABLE>
<TABLE>
<CAPTION>
Stated Remain-
Original Original ing Term
Monthly Term to Amort- to
Mortgage Debt Maturity ization Season- Maturity
Control Loan Service / ARD Term ing / ARD
Number Seller Loan / Property Name Payment (months) (months) (months) (months)
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 871,332.98 120 360 6 114
102 LBNA Medical Mutual of Ohio 269,190.52 120 360 2 118
103 LBNA Jorie Plaza 172,572.76 120 360 0 120
104 GCM Westland Meadows 164,098.87 120 360 1 119
105 GCM Stonegate One 154,456.71 120 360 1 119
106 SBRC 149 New Montgomery Street 150,444.64 120 360 10 110
107 LBNA 101 West Grand 70,538.76 120 360 0 120
108 LBNA 57 W. Grand 42,158.49 120 360 0 120
109 LBNA 40 West Hubbard 17,275.40 120 360 0 120
110 LBNA South Loop Market Place 124,868.74 120 360 1 119
111 GCM Granite State Marketplace 132,630.71 120 360 27 93
112 GCM Pacific Plaza 125,398.48 120 360 4 116
113 SBRC Seatac Village Shopping Center 114,290.74 120 360 15 105
114 LBNA Seattle-Mead Industrial Facilities 118,743.55 120 360 0 120
115 LBNA Hamilton Court Apartments 113,412.14 120 360 1 119
116 GCM Webster Building 121,668.03 120 360 8 112
117 SBRC Amerix Building 118,325.48 120 300 8 112
118 SBRC 85 Devonshire Street/258-262 Washington Street 108,067.76(a) 60 360 8 52
119 SBRC Centro De Distribucion del Norte 100,091.00 120 240 17 103
120 GCM 801 Boylston Street 88,832.26 120 273.3404 3 117
121 LBNA 29200 Northwestern Highway 77,662.67 120 360 1 119
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 76,568.40 117 357 2 115
122a 100 Market Street
122b 9 Executive Park Drive
122c 1255 South Willow Street
122d 135 Daniel Webster Highway
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 81,485.19 120 300 7 113
124 LBNA GE / Montgomery Wards 71,723.10 120 120 1 119
- Col. Springs
125 LBNA GE / Montgomery Wards 38,252.32 120 120 1 119
- Pasadena Tx
126 SBRC US Storage Centers 67,245.62 120 300 17 103
127 LBNA Traders Tower - Self Park 72,170.89 (c) 120 300 44 76
128 LBNA Mabek CO L.P. 112,770.40 180 180 79 101
129 GCM Burlington Self Storage 61,796.79 120 360 4 116
130 GCM Boynton Plaza 56,660.99 120 360 5 115
131 SBRC 601-609 Mission Street 55,437.74 120 360 7 113
132 GCM Garden Ridge 54,241.02 120 360 1 119
133 GCM 300 West Pratt Street 52,124.12 120 360 8 112
134 GCM The GTE Building 51,595.06 120 360 6 114
135 GCM Hamlin Court 53,147.34 120 360 6 114
136 AMCC Telex Building 53,495.63 120 360 6 114
137 AMCC Charnelton Place Office Building 50,947.96 120 360 11 109
138 GCM Michael's Plaza 46,525.82 120 360 8 112
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 46,560.70 120 360 6 114
& Cibola Village
139a Mountain Vista Apartments
139b Cibola Village
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 45,251.20 120 360 5 115
141 GCM 300 West Hubbard Street Building 27,020.16 120 360 8 112
142 GCM 445 North Wells Street Building 16,847.64 120 360 6 114
143 GCM Miracle Mile Business Center 42,942.47 120 360 7 113
144 GCM Folsom Self-Storage 42,940.15 120 360 3 117
</TABLE>
<TABLE>
<CAPTION>
Stated
Remaining
Amort-
Mortgage ization
Control Loan Term Cut-off Date
Number Seller Loan / Property Name (months) Balance
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
101 SBRC One Financial Place 354 119,577,992.90
102 LBNA Medical Mutual of Ohio 358 35,364,183.34
103 LBNA Jorie Plaza 360 22,800,000.00
104 GCM Westland Meadows 359 22,714,214.38
105 GCM Stonegate One 359 20,985,980.79
106 SBRC 149 New Montgomery Street 350 18,809,602.27
107 LBNA 101 West Grand 360 10,000,000.00
108 LBNA 57 W. Grand 360 6,000,000.00
109 LBNA 40 West Hubbard 360 2,500,000.00
110 LBNA South Loop Market Place 359 18,235,847.93
111 GCM Granite State Marketplace 333 18,205,496.80
112 GCM Pacific Plaza 356 16,426,642.13
113 SBRC Seatac Village Shopping Center 345 16,087,967.31
114 LBNA Seattle-Mead Industrial Facilities 360 16,000,000.00
115 LBNA Hamilton Court Apartments 359 15,988,454.53
116 GCM Webster Building 352 15,933,790.77
117 SBRC Amerix Building 292 14,401,990.84
118 SBRC 85 Devonshire Street/258-262 Washington Street 360 13,650,000.00
119 SBRC Centro De Distribucion del Norte 223 11,197,297.78
120 GCM 801 Boylston Street 270.3404 11,010,038.21
121 LBNA 29200 Northwestern Highway 359 10,268,534.52
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 355 9,975,377.47
122a 100 Market Street
122b 9 Executive Park Drive
122c 1255 South Willow Street
122d 135 Daniel Webster Highway
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 293 9,550,083.19
124 LBNA GE / Montgomery Wards 119 5,966,576.90
- Col. Springs
125 LBNA GE / Montgomery Wards 119 3,182,174.35
- Pasadena Tx
126 SBRC US Storage Centers 283 8,365,375.11
127 LBNA Traders Tower - Self Park 270 8,343,002.93
128 LBNA Mabek CO L.P. 101 8,145,363.67
129 GCM Burlington Self Storage 356 7,984,459.40
130 GCM Boynton Plaza 355 7,679,220.02
131 SBRC 601-609 Mission Street 353 7,372,988.89
132 GCM Garden Ridge 359 7,095,636.48
133 GCM 300 West Pratt Street 352 7,018,345.03
134 GCM The GTE Building 354 6,877,665.29
135 GCM Hamlin Court 354 6,810,392.89
136 AMCC Telex Building 354 6,781,144.09
137 AMCC Charnelton Place Office Building 349 6,709,489.20
138 GCM Michael's Plaza 352 6,247,050.40
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 354 5,982,627.15
& Cibola Village
139a Mountain Vista Apartments
139b Cibola Village
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 355 5,836,517.68
141 GCM 300 West Hubbard Street Building 352 3,535,350.48
142 GCM 445 North Wells Street Building 354 2,206,700.06
143 GCM Miracle Mile Business Center 353 5,679,548.69
144 GCM Folsom Self-Storage 357 5,591,013.15
</TABLE>
Footnotes: (a) Loan is interest only for the first 24 payments; Monthly Debt
Service Payment shown is the full P&I amount.
(b) Original Balance and First Payment Date were $10,495,000 and
8/1/00, respectively. A principal paydown of $495,000 occurred
following the third payment date of the loan, per the original
note terms. Original Balance and First Payment Date shown
above are subsequent to the principal paydown.
(c) Loan is interest only for the first 14 payments; Monthly Debt
Service Payment shown is the full P&I amount.
<PAGE> 201
GENERAL MORTGAGE LOAN INFORMATION
<TABLE>
<CAPTION>
Mortgage Mort- Admin- Net Mort- Interest
Control Loan Original gage istrative gage Rate Accrual Loan
Number Seller Loan / Property Name Balance Rate Fee Rate Rate Type Method Type
---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 5,600,000 7.5700% 0.1124% 7.4576% Fixed Actual/360 Balloon
146 LBNA Carriage House Lofts 5,500,000 8.1300% 0.0624% 8.0676% Fixed Actual/360 Balloon
147 GCM Northpointe Shopping Center 5,200,000 8.3200% 0.0624% 8.2576% Fixed Actual/360 Balloon
148 GCM 2 Willow Street 5,200,000 8.3720% 0.0624% 8.3096% Fixed Actual/360 Balloon
149 SBRC Villa de Mission East 5,200,000 7.7700% 0.0974% 7.6726% Fixed Actual/360 Balloon
150 GCM Calaveras Landing Shopping Center 5,200,000 7.9800% 0.0924% 7.8876% Fixed Actual/360 Balloon
151 GCM Healtheon 5,165,000 8.0400% 0.0924% 7.9476% Fixed Actual/360 Balloon
152 GCM 444 North Wells Street Building 5,140,000 8.4900% 0.0624% 8.4276% Fixed Actual/360 Balloon
153 GCM 1600 Corporate Center Drive 5,066,000 8.4600% 0.0624% 8.3976% Fixed Actual/360 Balloon
156 SBRC Town Green at Wilton Center 4,920,000 8.3600% 0.1474% 8.2126% Fixed Actual/360 Balloon
154 GCM Little Creek Apartments 5,050,000 7.8300% 0.0624% 7.7676% Fixed Actual/360 Balloon
155 GCM 271 - 285 East Fordham Road 4,968,000 8.4000% 0.0624% 8.3376% Fixed Actual/360 Balloon
157 GCM El Dorado Plaza 4,425,000 8.1300% 0.0624% 8.0676% Fixed Actual/360 Balloon
158 SBRC Tivoli Gardens Apartments 4,400,000 8.0400% 0.1024% 7.9376% Fixed Actual/360 Balloon
159 SBRC 155 Washington Ave 4,400,000 8.2500% 0.0624% 8.1876% Fixed Actual/360 Balloon
160 SBRC 370 Convention Way 4,281,000 9.1900% 0.0624% 9.1276% Fixed Actual/360 Balloon
161 GCM Union Landing Retail Center 4,250,000 7.7700% 0.0624% 7.7076% Fixed Actual/360 Balloon
162 GCM Briarwood Apartments 4,200,000 7.6900% 0.0624% 7.6276% Fixed Actual/360 Balloon
163 SBRC Franklinton Square Shopping Center 4,200,000 7.9800% 0.1224% 7.8576% Fixed Actual/360 Balloon
164 GCM Conquistador Apartments 4,200,000 8.1100% 0.0624% 8.0476% Fixed Actual/360 Balloon
165 GCM Greenhill Corporate Center 4,094,000 8.3200% 0.0924% 8.2276% Fixed Actual/360 Balloon
166 GCM Northridge Apartments 4,100,000 7.9800% 0.0624% 7.9176% Fixed Actual/360 Balloon
167 GCM Red Coach Village Apartments 4,100,000 7.9800% 0.0624% 7.9176% Fixed Actual/360 Balloon
168 AMCC K-Mart Shopping Center - Savannah 4,090,446 8.0500% 0.0624% 7.9876% Fixed Actual/360 Balloon
169 SBRC The Cascades 4,000,000 7.9600% 0.1124% 7.8476% Fixed Actual/360 Balloon
170 GCM The Trane Company Building 3,908,000 8.4400% 0.0624% 8.3776% Fixed Actual/360 Balloon
171 LBNA Chandler's Building 3,900,000 8.6500% 0.0624% 8.5876% Fixed Actual/360 Balloon
172 AMCC K-Mart Shopping Center - Nashville 3,840,545 8.0500% 0.0624% 7.9876% Fixed Actual/360 Balloon
173 AMCC 2150 Joshua's Path 3,800,000 8.0500% 0.0624% 7.9876% Fixed Actual/360 Balloon
174 AMCC Ver-Sa-Til 3,750,000 7.8750% 0.0624% 7.8126% Fixed Actual/360 Balloon
175 LBNA Springdale Mall 3,650,000 8.1700% 0.0624% 8.1076% Fixed Actual/360 Balloon
176 LBNA Frontier Commons/Global Crossing 3,650,000 8.4100% 0.0624% 8.3476% Fixed Actual/360 Balloon
177 GCM Wythe Shopping Center 3,645,000 8.3500% 0.0624% 8.2876% Fixed Actual/360 Balloon
178 AMCC Pencader Corporate Center 3,640,000 8.0000% 0.0624% 7.9376% Fixed Actual/360 Balloon
179 LBNA Watermark Office Building 3,450,000 8.4210% 0.0624% 8.3586% Fixed Actual/360 Balloon
180 GCM 801 West Diversey Parkway 3,400,000 8.9900% 0.0624% 8.9276% Fixed Actual/360 Balloon
181 GCM Lafayette Business Park 3,400,000 8.1200% 0.0924% 8.0276% Fixed Actual/360 Balloon
182 GCM Arrow Business Center 3,250,000 8.3600% 0.0924% 8.2676% Fixed Actual/360 Balloon
</TABLE>
<TABLE>
<CAPTION>
Original
Antici- Sched- Monthly Term to
Mortgage First pated uled Debt Maturity
Control Loan Payment Grace Repay- Maturity Service / ARD
Number Seller Loan / Property Name Note Date Date Period ment Date Date Payment (months)
-------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 07/26/99 09/01/99 10 NAP 08/01/09 39,424.78 120
146 LBNA Carriage House Lofts 11/16/00 01/01/01 5 NAP 12/01/10 40,856.60 120
147 GCM Northpointe Shopping Center 09/18/00 11/01/00 5 NAP 10/01/10 39,322.05 120
148 GCM 2 Willow Street 08/16/00 10/01/00 5 NAP 09/01/10 39,512.75 120
149 SBRC Villa de Mission East 04/13/00 06/01/00 5 NAP 05/01/10 37,325.33 120
150 GCM Calaveras Landing Shopping Center 02/23/00 04/01/00 5 NAP 03/01/10 38,083.28 120
151 GCM Healtheon 04/28/00 06/01/00 5 NAP 05/01/10 38,043.06 120
152 GCM 444 North Wells Street Building 04/30/00 07/01/00 5 NAP 06/01/10 39,485.73 120
153 GCM 1600 Corporate Center Drive 07/14/00 09/01/00 5 NAP 08/01/10 38,809.64 120
156 SBRC Town Green at Wilton Center 06/14/00 08/01/00 10 NAP 07/01/10 37,343.47 120
154 GCM Little Creek Apartments 09/13/00 11/01/00 5 NAP 10/01/10 36,458.39 120
155 GCM 271 - 285 East Fordham Road 10/01/99 12/01/99 5 NAP 11/01/09 37,848.09 120
157 GCM El Dorado Plaza 09/21/00 11/01/00 5 NAP 10/01/10 32,870.99 120
158 SBRC Tivoli Gardens Apartments 11/19/99 01/01/00 10 NAP 12/01/09 32,408.42 120
159 SBRC 155 Washington Ave 09/24/99 11/01/99 10 NAP 10/01/09 34,691.81 120
160 SBRC 370 Convention Way 05/30/00 07/01/00 5 NAP 06/01/07 35,032.75 84
161 GCM Union Landing Retail Center 04/24/00 06/01/00 5 NAP 05/01/10 30,506.28 120
162 GCM Briarwood Apartments 09/25/00 11/01/00 5 NAP 10/01/10 29,915.36 120
163 SBRC Franklinton Square Shopping Center 04/11/00 06/01/00 15 NAP 05/01/10 30,759.57 120
164 GCM Conquistador Apartments 07/28/99 09/01/99 5 NAP 08/01/09 31,140.79 120
165 GCM Greenhill Corporate Center 09/21/00 11/01/00 5 NAP 10/01/10 30,958.56 120
166 GCM Northridge Apartments 05/03/00 07/01/00 5 NAP 06/01/10 30,027.20 120
167 GCM Red Coach Village Apartments 04/12/00 06/01/00 5 NAP 05/01/10 30,027.20 120
168 AMCC K-Mart Shopping Center - Savannah 12/13/99 02/01/00 10 NAP 01/01/10 30,156.95 120
169 SBRC The Cascades 08/30/99 10/01/99 10 NAP 09/01/09 29,239.12 120
170 GCM The Trane Company Building 04/27/00 06/01/00 3 NAP 05/01/10 29,883.12 120
171 LBNA Chandler's Building 04/27/00 06/01/00 5 NAP 05/01/10 30,403.20 120
172 AMCC K-Mart Shopping Center - Nashville 12/13/99 02/01/00 10 NAP 01/01/10 28,314.54 120
173 AMCC 2150 Joshua's Path 11/04/99 01/01/00 10 NAP 12/01/09 28,015.63 120
174 AMCC Ver-Sa-Til 06/21/99 08/01/99 10 NAP 07/01/09 27,190.11 120
175 LBNA Springdale Mall 09/06/00 11/01/00 5 NAP 10/01/10 27,216.22 120
176 LBNA Frontier Commons/Global Crossing 06/28/00 08/01/00 5 NAP 07/01/10 27,832.86 120
177 GCM Wythe Shopping Center 03/30/00 05/01/00 7 NAP 04/01/10 27,640.34 120
178 AMCC Pencader Corporate Center 06/14/99 08/01/99 10 NAP 07/01/09 26,709.04 120
179 LBNA Watermark Office Building 09/19/00 11/01/00 5 NAP 10/01/12 26,334.60 144
180 GCM 801 West Diversey Parkway 05/18/00 07/01/00 5 NAP 06/01/10 27,332.71 120
181 GCM Lafayette Business Park 02/25/00 04/01/00 5 NAP 03/01/10 25,233.00 120
182 GCM Arrow Business Center 09/28/00 11/01/00 5 NAP 10/01/10 24,667.94 120
</TABLE>
<TABLE>
<CAPTION>
Stated Remain- Stated
Original ing Term Remaining
Amort- to Amort-
Mortgage ization Season- Maturity ization
Control Loan Term ing / ARD Term Cut-off Date
Number Seller Loan / Property Name (months) (months) (months) (months) Balance
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 360 16 104 344 5,541,084.10
146 LBNA Carriage House Lofts 360 0 120 360 5,500,000.00
147 GCM Northpointe Shopping Center 360 2 118 358 5,194,650.01
148 GCM 2 Willow Street 360 3 117 357 5,191,446.87
149 SBRC Villa de Mission East 360 7 113 353 5,178,495.88
150 GCM Calaveras Landing Shopping Center 360 9 111 351 5,173,541.50
151 GCM Healtheon 360 7 113 353 5,145,165.22
152 GCM 444 North Wells Street Building 360 6 114 354 5,124,645.67
153 GCM 1600 Corporate Center Drive 360 4 116 356 5,055,904.72
156 SBRC Town Green at Wilton Center 360 5 115 355 4,907,937.15
154 GCM Little Creek Apartments 360 2 118 358 5,044,068.38
155 GCM 271 - 285 East Fordham Road 360 13 107 347 4,933,554.73
157 GCM El Dorado Plaza 360 2 118 358 4,420,203.26
158 SBRC Tivoli Gardens Apartments 360 12 108 348 4,369,641.03
159 SBRC 155 Washington Ave 300 14 106 286 4,342,309.01
160 SBRC 370 Convention Way 360 6 78 354 4,270,597.44
161 GCM Union Landing Retail Center 360 7 113 353 4,232,424.51
162 GCM Briarwood Apartments 360 2 118 358 4,194,882.97
163 SBRC Franklinton Square Shopping Center 360 7 113 353 4,183,599.97
164 GCM Conquistador Apartments 360 16 104 344 4,161,547.16
165 GCM Greenhill Corporate Center 360 2 118 358 4,089,787.90
166 GCM Northridge Apartments 360 6 114 354 4,085,920.27
167 GCM Red Coach Village Apartments 360 7 113 353 4,083,990.44
168 AMCC K-Mart Shopping Center - Savannah 360 11 109 349 4,064,239.35
169 SBRC The Cascades 360 15 105 345 3,963,919.71
170 GCM The Trane Company Building 360 7 113 353 3,894,615.54
171 LBNA Chandler's Building 360 7 113 353 3,887,453.97
172 AMCC K-Mart Shopping Center - Nashville 360 11 109 349 3,815,939.49
173 AMCC 2150 Joshua's Path 360 12 108 348 3,773,850.13
174 AMCC Ver-Sa-Til 360 17 103 343 3,711,531.69
175 LBNA Springdale Mall 360 2 118 358 3,646,086.27
176 LBNA Frontier Commons/Global Crossing 360 5 115 355 3,641,183.51
177 GCM Wythe Shopping Center 360 8 112 352 3,629,791.06
178 AMCC Pencader Corporate Center 360 17 103 343 3,603,874.20
179 LBNA Watermark Office Building 360 2 142 358 3,446,549.32
180 GCM 801 West Diversey Parkway 360 6 114 354 3,391,218.31
181 GCM Lafayette Business Park 360 9 111 351 3,383,354.91
182 GCM Arrow Business Center 360 2 118 358 3,246,693.32
</TABLE>
<PAGE> 202
GENERAL MORTGAGE LOAN INFORMATION
<TABLE>
<CAPTION>
Mortgage Mort- Admin- Net Mort- Interest
Control Loan Original gage istrative gage Rate Accrual
Number Seller Loan / Property Name Balance Rate Fee Rate Rate Type Method
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
183 LBNA Palm Haven Mobile Home Park 3,200,000 8.6000% 0.0824% 8.5176% Fixed Actual/360
184 AMCC Cedar Marketplace 3,200,000 8.0000% 0.0624% 7.9376% Fixed Actual/360
185 GCM Crossroads Professional Building 3,150,000 8.1100% 0.0624% 8.0476% Fixed Actual/360
186 LBNA Imperial Crown Center 3,100,000 8.2730% 0.0624% 8.2106% Fixed Actual/360
187 GCM Fran Murphy Building 3,050,000 8.2700% 0.1224% 8.1476% Fixed Actual/360
188 GCM Walgreen's - South Medford 3,010,000 8.2300% 0.0624% 8.1676% Fixed Actual/360
189 GCM Sav-on and Carl's Jr. 3,000,000 8.0000% 0.0624% 7.9376% Fixed Actual/360
190 AMCC The Shops at Enon Springs 2,895,000 8.1000% 0.0624% 8.0376% Fixed Actual/360
191 AMCC Sierra Heartland Senior Apartments 2,850,000 8.0000% 0.0624% 7.9376% Fixed Actual/360
192 GCM Weatherbridge Center Buildings II and III 2,873,000 8.6900% 0.0924% 8.5976% Fixed Actual/360
193 SBRC K-Mart Shopping Center - Salem 2,816,000 8.7500% 0.0624% 8.6876% Fixed Actual/360
194 GCM 1201 Sharp Street 2,775,000 8.3900% 0.0924% 8.2976% Fixed Actual/360
195 AMCC RPS Warehouse 2,700,000 8.1800% 0.0624% 8.1176% Fixed Actual/360
196 AMCC 755 & 775 Fiero Lane 2,700,000 8.7500% 0.0624% 8.6876% Fixed Actual/360
197 GCM Redondo Tower Apartments 2,600,000 7.9700% 0.0624% 7.9076% Fixed Actual/360
198 AMCC Plaza II Office Building 2,600,000 8.0000% 0.0624% 7.9376% Fixed Actual/360
199 LBNA Fountain Place Apartments 2,550,000 7.7900% 0.0824% 7.7076% Fixed Actual/360
200 AMCC Carriage House Apartment 1,100,000 7.5000% 0.0624% 7.4376% Fixed 30/360
- Sioux Falls
201 AMCC Carriage House Apartment 835,000 7.5000% 0.0624% 7.4376% Fixed 30/360
- Brookings
202 AMCC Carriage House Apartment 690,000 7.5000% 0.0624% 7.4376% Fixed 30/360
- Pierre
203 GCM Pioneer Point Apartments 2,480,000 8.4200% 0.0624% 8.3576% Fixed Actual/360
204 AMCC CVS Harper Center 2,450,000 8.1500% 0.0624% 8.0876% Fixed Actual/360
205 SBRC K-Mart Shopping Center 2,445,000 8.7000% 0.0624% 8.6376% Fixed Actual/360
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 2,425,000 8.5400% 0.0624% 8.4776% Fixed Actual/360
207 SBRC Broadway Plaza Building 2,400,000 8.4510% 0.1124% 8.3386% Fixed Actual/360
208 SBRC 225 Long Avenue 2,400,000 8.5300% 0.0624% 8.4676% Fixed Actual/360
209 LBNA Almond Grand Gurnee 2,390,000 8.6500% 0.0624% 8.5876% Fixed Actual/360
210 GCM Summit/Breckenridge Apartments 2,400,000 8.4900% 0.0624% 8.4276% Fixed Actual/360
211 GCM Peppertree Apartments 2,370,000 8.1800% 0.1224% 8.0576% Fixed Actual/360
212 GCM Hillmount Apartments 2,360,000 8.1500% 0.0624% 8.0876% Fixed Actual/360
213 AMCC 1500 Renaissance Building 2,300,000 8.6500% 0.0624% 8.5876% Fixed Actual/360
214 AMCC Etinuum Office Building 2,275,000 8.7700% 0.0624% 8.7076% Fixed Actual/360
215 AMCC DHR Office Building 2,300,000 8.1000% 0.0624% 8.0376% Fixed Actual/360
216 GCM Oakwood Manor Apartments 2,240,000 8.1500% 0.0624% 8.0876% Fixed Actual/360
217 GCM Woodbend Apartments 2,185,000 8.1100% 0.0624% 8.0476% Fixed Actual/360
218 AMCC Warminster Shopping Center 2,200,000 8.4000% 0.0624% 8.3376% Fixed Actual/360
219 AMCC PBR II 1,245,000 7.3500% 0.0624% 7.2876% Fixed Actual/360
220 AMCC PBR I 900,000 7.4500% 0.0624% 7.3876% Fixed Actual/360
221 GCM U-Stor Chambers Self-Storage 2,075,000 8.4500% 0.0624% 8.3876% Fixed Actual/360
222 GCM 9925-9929 Jefferson Boulevard 2,000,000 8.5200% 0.0624% 8.4576% Fixed Actual/360
223 AMCC 810-812 Fiero Lane 2,000,000 7.9000% 0.0624% 7.8376% Fixed Actual/360
224 AMCC Lab Corp of America 1,868,000 8.4500% 0.0624% 8.3876% Fixed Actual/360
225 LBNA Birchbrook Office Park 1,800,000 8.4900% 0.0624% 8.4276% Fixed Actual/360
226 GCM Oro Valley Self Storage 1,721,000 8.5000% 0.0624% 8.4376% Fixed Actual/360
227 AMCC Hillcrest Retail/Office Shopping Center 1,700,000 8.6800% 0.0624% 8.6176% Fixed Actual/360
228 AMCC Cain Drive Warehouses 1,700,000 8.5000% 0.0624% 8.4376% Fixed Actual/360
229 SBRC Mini-City Self Storage 1,670,000 8.5700% 0.1124% 8.4576% Fixed Actual/360
230 AMCC Macy Building 1,700,000 7.5000% 0.0624% 7.4376% Fixed Actual/360
231 GCM Senate Place Apartments 885,000 8.3000% 0.0624% 8.2376% Fixed Actual/360
232 GCM Eastfield Townhouses 675,000 8.3000% 0.0624% 8.2376% Fixed Actual/360
233 LBNA Kendall Manor Apartments 1,500,000 8.5500% 0.0824% 8.4676% Fixed Actual/360
234 AMCC The Culver Building 1,500,000 8.2000% 0.0624% 8.1376% Fixed Actual/360
235 AMCC Harvard Physicians Building 1,500,000 8.2000% 0.0624% 8.1376% Fixed Actual/360
236 AMCC Lyon Street Retail 1,600,000 7.7500% 0.0624% 7.6876% Fixed 30/360
237 AMCC 350 Newton Avenue Apartments 1,500,000 6.7500% 0.0624% 6.6876% Fixed Actual/360
238 AMCC Solar Gardens 1,470,000 7.8500% 0.0624% 7.7876% Fixed Actual/360
239 AMCC Quality Suites Albuquerque 1,481,366 7.8000% 0.0624% 7.7376% Fixed 30/360
240 AMCC Springville Corners 1,440,000 8.5000% 0.0624% 8.4376% Fixed Actual/360
241 AMCC 224-234 East Broad Street 1,500,000 7.2500% 0.0624% 7.1876% Fixed Actual/360
242 GCM 6380 McLeod Drive 1,405,000 8.3500% 0.0624% 8.2876% Fixed Actual/360
243 AMCC Black Mountain Point Office Building 1,450,000 7.9000% 0.0624% 7.8376% Fixed Actual/360
244 AMCC Waste Management Building 1,400,000 8.4900% 0.0624% 8.4276% Fixed Actual/360
245 AMCC Silver Lake Plaza 1,400,000 8.3500% 0.0624% 8.2876% Fixed Actual/360
246 AMCC Checkmate Apartments 1,356,600 8.3500% 0.0624% 8.2876% Fixed Actual/360
247 AMCC Creekside Center 1,275,000 8.5500% 0.0624% 8.4876% Fixed Actual/360
248 AMCC Tolt Towne Center 1,300,000 7.4000% 0.0624% 7.3376% Fixed Actual/360
249 AMCC South Fridley Apartments 1,325,000 7.3000% 0.0624% 7.2376% Fixed 30/360
250 GCM 6668 Owens Drive 1,250,000 8.1500% 0.0624% 8.0876% Fixed Actual/360
251 GCM 6320 - 6330 McLeod Drive 1,242,500 8.7200% 0.0624% 8.6576% Fixed Actual/360
252 GCM Rite Aid - Hillside 1,200,000 8.5900% 0.0624% 8.5276% Fixed Actual/360
253 AMCC Howard Johnson Lake Havasu 1,182,907 7.8000% 0.0624% 7.7376% Fixed 30/360
254 LBNA Wickiup Mobile Home & RV Park 1,135,000 8.2400% 0.0824% 8.1576% Fixed Actual/360
255 AMCC 261 East 300 South 1,150,000 7.5000% 0.0624% 7.4376% Fixed Actual/360
</TABLE>
<TABLE>
<CAPTION>
Antici-
pated Sched- Monthly
Mortgage First Repay- uled Debt
Control Loan Loan Payment Grace ment Maturity Service
Number Seller Loan / Property Name Type Note Date Date Period Date Date Payment
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
183 LBNA Palm Haven Mobile Home Park Balloon 06/08/00 08/01/00 5 NAP 07/01/10 24,832.37
184 AMCC Cedar Marketplace Balloon 10/01/99 12/01/99 10 NAP 11/01/09 23,480.47
185 GCM Crossroads Professional Building Balloon 09/07/00 11/01/00 5 NAP 10/01/10 24,542.19
186 LBNA Imperial Crown Center Balloon 11/16/00 01/01/01 5 NAP 12/01/10 23,339.41
187 GCM Fran Murphy Building Balloon 09/18/00 11/01/00 5 NAP 10/01/10 24,088.51
188 GCM Walgreen's - South Medford Balloon 10/02/00 12/01/00 5 NAP 11/01/10 23,692.13
189 GCM Sav-on and Carl's Jr. Balloon 08/31/00 10/01/00 5 NAP 09/01/10 22,012.94
190 AMCC The Shops at Enon Springs Balloon 04/26/00 06/01/00 5 NAP 05/01/10 21,444.65
191 AMCC Sierra Heartland Senior Apartments Balloon 07/07/00 09/01/00 5 NAP 08/01/10 20,912.30
192 GCM Weatherbridge Center Buildings II and III Full Amort 07/12/00 09/01/00 5 NAP 08/01/15 28,612.45
193 SBRC K-Mart Shopping Center - Salem Balloon 05/10/00 07/01/00 5 NAP 06/01/10 24,885.29
194 GCM 1201 Sharp Street Balloon 12/10/99 02/01/00 5 NAP 01/01/10 21,121.39
195 AMCC RPS Warehouse Balloon 07/05/00 09/01/00 5 NAP 08/01/10 20,151.49
196 AMCC 755 & 775 Fiero Lane Balloon 02/28/00 04/01/00 5 NAP 03/01/10 21,240.92
197 GCM Redondo Tower Apartments Balloon 06/27/00 08/01/00 5 NAP 07/01/10 19,023.53
198 AMCC Plaza II Office Building Balloon 08/25/99 10/01/99 10 NAP 09/01/09 20,067.23
199 LBNA Fountain Place Apartments Balloon 09/01/99 10/01/99 5 NAP 09/01/09 18,339.05
200 AMCC Carriage House Apartment Full Amort 03/31/99 05/01/99 10 NAP 04/01/19 8,861.53
- Sioux Falls
201 AMCC Carriage House Apartment Full Amort 03/31/99 05/01/99 10 NAP 04/01/19 6,726.71
- Brookings
202 AMCC Carriage House Apartment Full Amort 03/31/99 05/01/99 10 NAP 04/01/19 5,558.60
- Pierre
203 GCM Pioneer Point Apartments Balloon 06/24/99 08/01/99 5 NAP 07/01/09 18,928.68
204 AMCC CVS Harper Center Balloon 10/05/00 12/01/00 5 NAP 11/01/10 18,234.08
205 SBRC K-Mart Shopping Center Full Amort 05/10/00 07/01/00 5 NAP 06/01/20 21,528.79
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive Balloon 03/02/00 05/01/00 5 NAP 04/01/10 18,715.00
207 SBRC Broadway Plaza Building Balloon 06/30/00 08/01/00 5 NAP 07/01/10 18,370.64
208 SBRC 225 Long Avenue Balloon 07/21/00 09/01/00 10 NAP 08/01/10 19,373.99
209 LBNA Almond Grand Gurnee Balloon 08/03/00 10/01/00 5 NAP 07/01/06 18,631.70
210 GCM Summit/Breckenridge Apartments Balloon 02/10/00 04/01/00 5 NAP 03/01/10 19,309.28
211 GCM Peppertree Apartments Balloon 06/08/00 08/01/00 5 NAP 07/01/10 17,688.52
212 GCM Hillmount Apartments Balloon 03/31/00 05/01/00 5 NAP 04/01/10 17,564.26
213 AMCC 1500 Renaissance Building Balloon 04/14/00 06/01/00 5 NAP 05/01/10 17,930.10
214 AMCC Etinuum Office Building Balloon 10/13/00 12/01/00 5 NAP 11/01/10 17,929.95
215 AMCC DHR Office Building Balloon 07/28/99 09/01/99 10 NAP 08/01/09 17,904.41
216 GCM Oakwood Manor Apartments Balloon 03/31/00 05/01/00 5 NAP 04/01/10 16,671.16
217 GCM Woodbend Apartments Balloon 08/14/00 10/01/00 5 NAP 09/01/10 16,200.62
218 AMCC Warminster Shopping Center Balloon 09/07/99 11/01/99 10 NAP 10/01/09 17,566.99
219 AMCC PBR II Balloon 08/03/98 10/01/98 10 NAP 09/01/08 9,079.32
220 AMCC PBR I Balloon 08/03/98 10/01/98 10 NAP 09/01/08 6,621.68
221 GCM U-Stor Chambers Self-Storage Balloon 08/02/00 10/01/00 5 NAP 09/01/10 15,881.48
222 GCM 9925-9929 Jefferson Boulevard Balloon 06/09/00 08/01/00 5 NAP 07/01/10 15,406.63
223 AMCC 810-812 Fiero Lane Balloon 07/08/99 09/01/99 10 NAP 08/01/11 15,304.07
224 AMCC Lab Corp of America Balloon 12/23/99 02/01/00 10 NAP 01/01/10 16,151.88
225 LBNA Birchbrook Office Park Balloon 06/30/00 08/01/00 5 NAP 07/01/10 13,827.69
226 GCM Oro Valley Self Storage Balloon 06/07/00 08/01/00 5 NAP 07/01/10 13,233.00
227 AMCC Hillcrest Retail/Office Shopping Center Balloon 06/23/00 08/01/00 5 NAP 07/01/10 13,289.01
228 AMCC Cain Drive Warehouses Balloon 06/21/99 08/01/99 10 NAP 07/01/09 13,688.87
229 SBRC Mini-City Self Storage Balloon 07/21/00 09/01/00 10 NAP 08/01/10 13,526.16
230 AMCC Macy Building Balloon 03/26/99 05/01/99 10 NAP 04/01/09 12,562.86
231 GCM Senate Place Apartments Balloon 06/15/00 08/01/00 5 NAP 07/01/10 6,679.84
232 GCM Eastfield Townhouses Balloon 06/15/00 08/01/00 5 NAP 07/01/10 5,094.80
233 LBNA Kendall Manor Apartments Balloon 06/29/00 08/01/00 5 NAP 07/01/10 11,586.90
234 AMCC The Culver Building Balloon 08/12/99 10/01/99 10 NAP 09/01/09 11,216.32
235 AMCC Harvard Physicians Building Balloon 07/27/99 09/01/99 10 NAP 08/01/09 11,776.68
236 AMCC Lyon Street Retail Full Amort 07/09/98 09/01/98 10 NAP 08/01/13 15,060.41
237 AMCC 350 Newton Avenue Apartments Balloon 10/19/98 12/01/98 10 NAP 11/01/08 10,363.68
238 AMCC Solar Gardens Balloon 07/23/99 09/01/99 10 NAP 08/01/09 11,200.02
239 AMCC Quality Suites Albuquerque Full Amort 09/24/99 10/01/99 10 NAP 02/01/19 12,360.55
240 AMCC Springville Corners Balloon 05/12/00 07/01/00 5 NAP 06/01/10 11,072.36
241 AMCC 224-234 East Broad Street Balloon 09/18/98 11/01/98 10 NAP 10/01/09 11,855.64
242 GCM 6380 McLeod Drive Balloon 08/07/00 10/01/00 5 NAP 09/01/10 10,654.23
243 AMCC Black Mountain Point Office Building Balloon 04/28/98 06/01/98 10 NAP 05/01/08 11,095.46
244 AMCC Waste Management Building Balloon 08/04/00 10/01/00 5 NAP 09/01/10 12,140.67
245 AMCC Silver Lake Plaza Balloon 10/27/99 01/01/00 10 NAP 12/01/09 10,616.32
246 AMCC Checkmate Apartments Balloon 08/06/99 10/01/99 10 NAP 09/01/09 10,287.21
247 AMCC Creekside Center Balloon 09/28/00 11/01/00 5 NAP 10/01/10 9,848.87
248 AMCC Tolt Towne Center Balloon 07/30/98 09/01/98 10 NAP 08/01/08 9,522.49
249 AMCC South Fridley Apartments Full Amort 09/30/98 11/01/98 10 NAP 10/01/18 10,512.66
250 GCM 6668 Owens Drive Balloon 04/17/00 06/01/00 5 NAP 05/01/10 9,303.10
251 GCM 6320 - 6330 McLeod Drive Balloon 06/01/00 07/01/00 5 NAP 06/01/10 9,748.14
252 GCM Rite Aid - Hillside Full Amort 05/26/99 07/01/99 10 NAP 06/01/16 11,204.99
253 AMCC Howard Johnson Lake Havasu Full Amort 09/24/99 10/01/99 10 NAP 01/01/19 9,888.44
254 LBNA Wickiup Mobile Home & RV Park Balloon 08/14/00 10/01/00 5 NAP 09/01/10 8,518.90
255 AMCC 261 East 300 South Balloon 06/11/99 08/01/99 10 NAP 07/01/09 8,498.40
</TABLE>
<TABLE>
<CAPTION>
Stated Remain- Stated
Original Original ing Term Remaining
Term to Amort- to Amort-
Mortgage Maturity/ ization Season- Maturity/ ization
Control Loan ARD Term ing ARD Term Cut-off Date
Number Seller Loan / Property Name (months) (months) (months) (months) (months) Balance
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
183 LBNA Palm Haven Mobile Home Park 120 360 5 115 355 3,192,703.97
184 AMCC Cedar Marketplace 120 360 13 107 347 3,175,357.80
185 GCM Crossroads Professional Building 120 300 2 118 298 3,144,185.55
186 LBNA Imperial Crown Center 120 360 0 120 360 3,100,000.00
187 GCM Fran Murphy Building 120 300 2 118 298 3,044,546.48
188 GCM Walgreen's - South Medford 120 300 1 119 299 3,006,951.45
189 GCM Sav-on and Carl's Jr. 120 360 3 117 357 2,994,591.49
190 AMCC The Shops at Enon Springs 120 360 7 113 353 2,884,067.62
191 AMCC Sierra Heartland Senior Apartments 120 360 4 116 356 2,843,556.89
192 GCM Weatherbridge Center Buildings II and III 180 180 4 176 176 2,842,834.15
193 SBRC K-Mart Shopping Center - Salem 120 240 6 114 234 2,791,494.14
194 GCM 1201 Sharp Street 120 360 11 109 349 2,758,739.76
195 AMCC RPS Warehouse 120 360 4 116 356 2,694,185.44
196 AMCC 755 & 775 Fiero Lane 120 360 9 111 351 2,688,987.40
197 GCM Redondo Tower Apartments 120 360 5 115 355 2,592,863.12
198 AMCC Plaza II Office Building 120 300 15 105 285 2,561,221.85
199 LBNA Fountain Place Apartments 120 360 15 105 345 2,525,985.85
200 AMCC Carriage House Apartment 240 240 20 220 220 1,057,819.54
- Sioux Falls
201 AMCC Carriage House Apartment 240 240 20 220 220 802,981.13
- Brookings
202 AMCC Carriage House Apartment 240 240 20 220 220 663,541.26
- Pierre
203 GCM Pioneer Point Apartments 120 360 17 103 343 2,458,055.17
204 AMCC CVS Harper Center 120 360 1 119 359 2,448,405.50
205 SBRC K-Mart Shopping Center 240 240 6 234 234 2,423,568.25
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 120 360 8 112 352 2,415,403.74
207 SBRC Broadway Plaza Building 120 360 5 115 355 2,394,273.84
208 SBRC 225 Long Avenue 120 300 4 116 296 2,391,797.50
209 LBNA Almond Grand Gurnee 70 360 3 67 357 2,386,336.28
210 GCM Summit/Breckenridge Apartments 120 300 9 111 291 2,381,344.05
211 GCM Peppertree Apartments 120 360 5 115 355 2,363,873.79
212 GCM Hillmount Apartments 120 360 8 112 352 2,349,600.74
213 AMCC 1500 Renaissance Building 120 360 7 113 353 2,292,601.00
214 AMCC Etinuum Office Building 120 360 1 119 359 2,273,696.51
215 AMCC DHR Office Building 120 300 16 104 284 2,264,274.12
216 GCM Oakwood Manor Apartments 120 360 8 112 352 2,230,129.54
217 GCM Woodbend Apartments 120 360 3 117 357 2,181,165.12
218 AMCC Warminster Shopping Center 120 300 14 106 286 2,171,988.57
219 AMCC PBR II 120 300 27 93 273 1,205,693.31
220 AMCC PBR I 120 300 27 93 273 872,075.11
221 GCM U-Stor Chambers Self-Storage 120 360 3 117 357 2,071,653.22
222 GCM 9925-9929 Jefferson Boulevard 120 360 5 115 355 1,995,326.85
223 AMCC 810-812 Fiero Lane 144 300 16 128 284 1,967,729.90
224 AMCC Lab Corp of America 120 240 11 109 229 1,836,081.28
225 LBNA Birchbrook Office Park 120 360 5 115 355 1,795,755.67
226 GCM Oro Valley Self Storage 120 360 5 115 355 1,716,954.25
227 AMCC Hillcrest Retail/Office Shopping Center 120 360 5 115 355 1,696,218.89
228 AMCC Cain Drive Warehouses 120 300 17 103 283 1,674,172.07
229 SBRC Mini-City Self Storage 120 300 4 116 296 1,664,338.67
230 AMCC Macy Building 120 300 20 100 280 1,662,577.79
231 GCM Senate Place Apartments 120 360 5 115 355 882,791.27
232 GCM Eastfield Townhouses 120 360 5 115 355 673,315.34
233 LBNA Kendall Manor Apartments 120 360 5 115 355 1,496,527.07
234 AMCC The Culver Building 120 360 15 105 345 1,487,285.20
235 AMCC Harvard Physicians Building 120 300 16 104 284 1,477,144.13
236 AMCC Lyon Street Retail 180 180 28 152 152 1,455,429.06
237 AMCC 350 Newton Avenue Apartments 120 300 25 95 275 1,451,685.83
238 AMCC Solar Gardens 120 300 16 104 284 1,446,056.89
239 AMCC Quality Suites Albuquerque 233 233 15 218 218 1,438,473.02
240 AMCC Springville Corners 120 360 6 114 354 1,435,710.47
241 AMCC 224-234 East Broad Street 132 240 26 106 214 1,425,427.52
242 GCM 6380 McLeod Drive 120 360 3 117 357 1,402,676.26
243 AMCC Black Mountain Point Office Building 120 300 31 89 269 1,402,109.92
244 AMCC Waste Management Building 120 240 3 117 237 1,393,577.40
245 AMCC Silver Lake Plaza 120 360 12 108 348 1,391,114.33
246 AMCC Checkmate Apartments 120 360 15 105 345 1,345,548.08
247 AMCC Creekside Center 120 360 2 118 358 1,273,770.53
248 AMCC Tolt Towne Center 120 300 28 92 272 1,257,845.64
249 AMCC South Fridley Apartments 240 240 26 214 214 1,256,148.95
250 GCM 6668 Owens Drive 120 360 7 113 353 1,245,345.71
251 GCM 6320 - 6330 McLeod Drive 120 360 6 114 354 1,239,024.49
252 GCM Rite Aid - Hillside 204 204 18 186 186 1,152,649.05
253 AMCC Howard Johnson Lake Havasu 232 232 15 217 217 1,148,369.52
254 LBNA Wickiup Mobile Home & RV Park 120 360 3 117 357 1,133,070.73
255 AMCC 261 East 300 South 120 300 17 103 283 1,128,824.58
</TABLE>
<PAGE> 203
GENERAL MORTGAGE LOAN INFORMATION
<TABLE>
<CAPTION>
MORTGAGE MORT- ADMIN- NET MORT- INTEREST
CONTROL LOAN ORIGINAL GAGE ISTRATIVE GAGE RATE ACCRUAL
NUMBER SELLER LOAN / PROPERTY NAME BALANCE RATE FEE RATE RATE TYPE METHOD
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 1,180,000 7.3000% 0.0624% 7.2376% Fixed 30/360
257 AMCC Hawthorne Business Park 1,120,000 8.2000% 0.0624% 8.1376% Fixed Actual/360
258 GCM Nogales Self Storage 1,080,000 8.5000% 0.0624% 8.4376% Fixed Actual/360
259 GCM Glendale West Self Storage 1,050,000 8.5000% 0.0624% 8.4376% Fixed Actual/360
260 AMCC Lovell Building 1,050,000 8.0000% 0.0624% 7.9376% Fixed Actual/360
261 AMCC Nationwide Insurance Office Building 1,075,000 7.9000% 0.0624% 7.8376% Fixed Actual/360
262 AMCC Attache Building 1,060,000 7.4000% 0.0624% 7.3376% Fixed Actual/360
263 GCM Airport Business Center 1,000,000 8.7200% 0.0624% 8.6576% Fixed Actual/360
264 AMCC Bluebonnet Apartments 985,000 8.6000% 0.0624% 8.5376% Fixed Actual/360
265 AMCC 8th Street Apartments 981,000 8.3500% 0.0624% 8.2876% Fixed Actual/360
266 LBNA E. M. Jorgensen Building 904,250 8.6800% 0.0624% 8.6176% Fixed Actual/360
267 AMCC Ralph's Grocery & Deli 910,000 7.5500% 0.0624% 7.4876% Fixed Actual/360
268 AMCC Market Square 850,000 7.9000% 0.0624% 7.8376% Fixed Actual/360
269 AMCC Blockbuster Video-Salt Lake City 850,000 7.5000% 0.0624% 7.4376% Fixed Actual/360
270 AMCC Prudential Wise-McIntire Office Building 785,000 7.4000% 0.0624% 7.3376% Fixed Actual/360
271 AMCC Licton Springs Court Apartments 750,000 7.4500% 0.0624% 7.3876% Fixed Actual/360
272 AMCC Surgicenter of South Bay 710,000 7.6000% 0.0624% 7.5376% Fixed Actual/360
273 AMCC West Fargo Living Center 700,000 7.3500% 0.0624% 7.2876% Fixed Actual/360
274 AMCC Edgewood Apartments 675,000 7.9000% 0.0624% 7.8376% Fixed 30/360
275 AMCC Washington/Shepherd Retail Center 700,000 7.2500% 0.0624% 7.1876% Fixed 30/360
276 AMCC Candlewood Apartments 630,000 9.3500% 0.0624% 9.2876% Fixed 30/360
277 AMCC Bishop Lifting Products 650,000 8.2000% 0.0624% 8.1376% Fixed 30/360
278 AMCC 188 State Street 532,000 7.5000% 0.0624% 7.4376% Fixed Actual/360
279 AMCC Woodstone Properties 550,000 7.6500% 0.0624% 7.5876% Fixed 30/360
280 AMCC East Gate Manor Apartments 500,000 8.4000% 0.0624% 8.3376% Fixed Actual/360
</TABLE>
<TABLE>
<CAPTION>
ANTICI-
PATED SCHED- MONTHLY
MORTGAGE FIRST REPAY- ULED DEBT
CONTROL LOAN LOAN PAYMENT GRACE MENT MATURITY SERVICE
NUMBER SELLER LOAN / PROPERTY NAME TYPE NOTE DATE DATE PERIOD DATE DATE PAYMENT
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments Full Amort 11/23/98 01/01/99 10 NAP 12/01/18 9,362.22
257 AMCC Hawthorne Business Park Balloon 10/31/00 12/01/00 5 NAP 11/01/10 8,374.85
258 GCM Nogales Self Storage Balloon 06/07/00 08/01/00 5 NAP 07/01/10 8,304.27
259 GCM Glendale West Self Storage Balloon 06/07/00 08/01/00 5 NAP 07/01/10 8,073.59
260 AMCC Lovell Building Balloon 07/15/99 09/01/99 10 NAP 08/01/09 7,704.53
261 AMCC Nationwide Insurance Office Building Balloon 02/26/99 04/01/99 10 NAP 03/01/09 8,924.95
262 AMCC Attache Building Balloon 10/29/98 12/01/98 10 NAP 11/01/08 7,764.49
263 GCM Airport Business Center Balloon 09/30/99 11/01/99 5 NAP 10/01/09 8,201.06
264 AMCC Bluebonnet Apartments Balloon 12/22/99 02/01/00 10 NAP 01/01/10 7,997.98
265 AMCC 8th Street Apartments Balloon 08/06/99 10/01/99 10 NAP 09/01/09 7,439.01
266 LBNA E. M. Jorgensen Building Balloon 06/09/00 08/01/00 5 NAP 07/01/10 7,068.58
267 AMCC Ralph's Grocery & Deli Balloon 06/30/98 08/01/98 10 NAP 07/01/10 6,754.45
268 AMCC Market Square Balloon 02/03/99 04/01/99 10 NAP 03/01/09 6,504.23
269 AMCC Blockbuster Video-Salt Lake City Balloon 08/28/98 10/01/98 10 NAP 09/01/08 6,281.43
270 AMCC Prudential Wise-McIntire Office Building Balloon 10/02/98 11/01/98 10 NAP 10/01/08 5,750.12
271 AMCC Licton Springs Court Apartments Balloon 06/10/98 08/01/98 10 NAP 07/01/08 5,518.07
272 AMCC Surgicenter of South Bay Balloon 07/15/98 09/01/98 10 NAP 08/01/08 5,763.21
273 AMCC West Fargo Living Center Balloon 09/17/98 11/01/98 10 NAP 10/01/08 5,575.12
274 AMCC Edgewood Apartments Full Amort 05/05/99 07/01/99 10 NAP 06/01/19 5,604.04
275 AMCC Washington/Shepherd Retail Center Full Amort 10/19/98 12/01/98 10 NAP 11/01/13 6,390.05
276 AMCC Candlewood Apartments Balloon 03/13/97 05/01/97 10 NAP 04/01/07 5,438.74
277 AMCC Bishop Lifting Products Full Amort 03/23/99 05/01/99 10 NAP 04/01/09 7,955.16
278 AMCC 188 State Street Balloon 11/12/98 01/01/99 10 NAP 12/01/08 4,285.76
279 AMCC Woodstone Properties Full Amort 07/23/98 09/01/98 10 NAP 08/01/13 5,145.57
280 AMCC East Gate Manor Apartments Balloon 12/06/99 02/01/00 10 NAP 01/01/10 3,992.50
</TABLE>
<TABLE>
<CAPTION>
STATED REMAIN- STATED
ORIGINAL ORIGINAL ING TERM REMAINING
TERM TO AMORT- TO AMORT-
MORTGAGE MATURITY IZATION SEASON- MATURITY IZATION
CONTROL LOAN / ARD TERM ING / ARD TERM CUT-OFF DATE
NUMBER SELLER LOAN / PROPERTY NAME (MONTHS) (MONTHS) (MONTHS) (MONTHS) (MONTHS) BALANCE
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 240 240 24 216 216 1,123,751.04
257 AMCC Hawthorne Business Park 120 360 1 119 359 1,119,278.48
258 GCM Nogales Self Storage 120 360 5 115 355 1,077,461.10
259 GCM Glendale West Self Storage 120 360 5 115 355 1,047,531.65
260 AMCC Lovell Building 120 360 16 104 344 1,040,104.09
261 AMCC Nationwide Insurance Office Building 120 240 21 99 219 1,036,270.65
262 AMCC Attache Building 120 300 25 95 275 1,029,447.80
263 GCM Airport Business Center 120 300 14 106 286 988,053.79
264 AMCC Bluebonnet Apartments 120 300 11 109 289 975,505.19
265 AMCC 8th Street Apartments 120 360 15 105 345 973,007.92
266 LBNA E. M. Jorgensen Building 120 360 5 115 355 902,238.79
267 AMCC Ralph's Grocery & Deli 144 300 29 115 271 880,257.05
268 AMCC Market Square 120 300 21 99 279 831,794.32
269 AMCC Blockbuster Video-Salt Lake City 120 300 27 93 273 823,855.65
270 AMCC Prudential Wise-McIntire Office Building 120 300 26 94 274 761,499.87
271 AMCC Licton Springs Court Apartments 120 300 29 91 271 725,049.40
272 AMCC Surgicenter of South Bay 120 240 28 92 212 673,400.49
273 AMCC West Fargo Living Center 120 240 26 94 214 665,632.63
274 AMCC Edgewood Apartments 240 240 18 222 222 652,904.01
275 AMCC Washington/Shepherd Retail Center 180 180 25 155 155 641,873.72
276 AMCC Candlewood Apartments 120 300 44 76 256 602,311.53
277 AMCC Bishop Lifting Products 120 120 20 100 100 574,975.87
278 AMCC 188 State Street 120 240 24 96 216 508,483.10
279 AMCC Woodstone Properties 180 180 28 152 152 499,921.46
280 AMCC East Gate Manor Apartments 120 300 11 109 289 494,988.34
</TABLE>
<PAGE> 204
MORTGAGE LOAN PREPAYMENT INFORMATION
<TABLE>
<CAPTION>
LOCKOUT DEFEASE- DEFEASE-
MORTGAGE PERIOD ANCE ANCE
CONTROL LOAN END START END
NUMBER SELLER LOAN/PROPERTY NAME PREPAYMENT PROVISIONS DATE DATE DATE
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place LO(30)/Defeasance(87)/Free(3) 12/31/02 01/01/03 03/31/10
102 LBNA Medical Mutual of Ohio LO(35)/Defeasance(82)/Free(3) 09/30/03 10/01/03 06/30/10
103 LBNA Jorie Plaza LO(35)/Defeasance(82)/Free(3) 11/30/03 12/01/03 09/30/10
104 GCM Westland Meadows LO(25)/Defeasance(91)/Free(4) 12/31/02 01/01/03 07/31/10
105 GCM Stonegate One LO(25)/Defeasance(91)/Free(4) 12/31/02 01/01/03 07/31/10
106 SBRC 149 New Montgomery Street LO(34)/Defeasance(84)/Free(2) 12/31/02 01/01/03 12/31/09
107 LBNA 101 West Grand LO(35)/Defeasance(82)/Free(3) 11/30/03 12/01/03 09/30/10
108 LBNA 57 W. Grand LO(35)/Defeasance(82)/Free(3) 11/30/03 12/01/03 09/30/10
109 LBNA 40 West Hubbard LO(35)/Defeasance(82)/Free(3) 11/30/03 12/01/03 09/30/10
110 LBNA South Loop Market Place LO(35)/Defeasance(82)/Free(3) 10/31/03 11/01/03 08/31/10
111 GCM Granite State Marketplace LO(51)/Defeasance(65)/Free(4) 12/31/02 01/01/03 05/31/08
112 GCM Pacific Plaza LO(28)/Defeasance(88)/Free(4) 12/31/02 01/01/03 04/30/10
113 SBRC Seatac Village Shopping Center LO(39)/Defeasance(79)/Free(2) 12/31/02 01/01/03 07/31/09
114 LBNA Seattle-Mead Industrial Facilities LO(35)/Defeasance(82)/Free(3) 11/30/03 12/01/03 09/30/10
115 LBNA Hamilton Court Apartments LO(35)/Defeasance(82)/Free(3) 10/31/03 11/01/03 08/31/10
116 GCM Webster Building LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
117 SBRC Amerix Building LO(32)/Defeasance(85)/Free(3) 12/31/02 01/01/03 01/31/10
118 SBRC 85 Devonshire Street/258-262 LO(32)/Defeasance(24)/Free(4) 12/31/02 01/01/03 12/31/04
Washington Street
119 SBRC Centro De Distribucion del Norte LO(41)/Defeasance(76)/Free(3) 12/31/02 01/01/03 04/30/09
120 GCM 801 Boylston Street LO(27)/Defeasance(89)/Free(4) 12/31/02 01/01/03 05/31/10
121 LBNA 29200 Northwestern Highway LO(35)/Defeasance(82)/Free(3) 10/31/03 11/01/03 08/31/10
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio LO(38)/Defeasance(75)/Free(4) 12/31/03 01/01/04 03/31/10
122a 100 Market Street
122b 9 Executive Park Drive
122c 1255 South Willow Street
122d 135 Daniel Webster Highway
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton LO(31)/Defeasance(85)/Free(4) 12/31/02 01/01/03 01/31/10
124 LBNA GE / Montgomery Wards LO(35)/Defeasance(82)/Free(3) 10/31/03 11/01/03 08/31/10
- Col. Springs
125 LBNA GE / Montgomery Wards LO(35)/Defeasance(82)/Free(3) 10/31/03 11/01/03 08/31/10
- Pasadena Tx
126 SBRC US Storage Centers LO(41)/Defeasance(75)/Free(4) 12/31/02 01/01/03 03/31/09
127 LBNA Traders Tower - Self Park Grtr1%UPBorYM(113)/Free(7) NAP NAP NAP
128 LBNA Mabek CO L.P. Grtr1%UPBorYM(171)/Free(9) NAP NAP NAP
129 GCM Burlington Self Storage LO(28)/Defeasance(88)/Free(4) 12/31/02 01/01/03 04/30/10
130 GCM Boynton Plaza LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
131 SBRC 601-609 Mission Street LO(31)/Defeasance(86)/Free(3) 12/31/02 01/01/03 02/28/10
132 GCM Garden Ridge LO(25)/Defeasance(91)/Free(4) 12/31/02 01/01/03 07/31/10
133 GCM 300 West Pratt Street LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
134 GCM The GTE Building LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
135 GCM Hamlin Court LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
136 AMCC Telex Building LO(36)/Defeasance(80)/Free(4) 06/30/03 07/01/03 02/28/10
137 AMCC Charnelton Place Office Building LO(60)/Defeasance(56)/Free(4) 01/31/05 02/01/05 09/30/09
138 GCM Michael's Plaza LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
& Cibola Village
139a Mountain Vista Apartments
139b Cibola Village
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center LO(35)/Defeasance(82)/Free(3) 06/30/03 07/01/03 04/30/10
141 GCM 300 West Hubbard Street Building LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
142 GCM 445 North Wells Street Building LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
143 GCM Miracle Mile Business Center LO(59)/Grtr1%UPBorYM(57)/Free(4) 04/30/05 NAP NAP
144 GCM Folsom Self-Storage LO(27)/Defeasance(89)/Free(4) 12/31/02 01/01/03 05/31/10
</TABLE>
<TABLE>
<CAPTION>
YIELD YIELD
MAINTEN- MAINTEN- PREPAY- PREPAY-
ANCE ANCE MENT MENT
MORTGAGE PERIOD PERIOD PENALTY PENALTY
CONTROL LOAN START END START END
NUMBER SELLER LOAN/PROPERTY NAME DATE DATE DATE DATE
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place NAP NAP NAP NAP
102 LBNA Medical Mutual of Ohio NAP NAP NAP NAP
103 LBNA Jorie Plaza NAP NAP NAP NAP
104 GCM Westland Meadows NAP NAP NAP NAP
105 GCM Stonegate One NAP NAP NAP NAP
106 SBRC 149 New Montgomery Street NAP NAP NAP NAP
107 LBNA 101 West Grand NAP NAP NAP NAP
108 LBNA 57 W. Grand NAP NAP NAP NAP
109 LBNA 40 West Hubbard NAP NAP NAP NAP
110 LBNA South Loop Market Place NAP NAP NAP NAP
111 GCM Granite State Marketplace NAP NAP NAP NAP
112 GCM Pacific Plaza NAP NAP NAP NAP
113 SBRC Seatac Village Shopping Center NAP NAP NAP NAP
114 LBNA Seattle-Mead Industrial Facilities NAP NAP NAP NAP
115 LBNA Hamilton Court Apartments NAP NAP NAP NAP
116 GCM Webster Building NAP NAP NAP NAP
117 SBRC Amerix Building NAP NAP NAP NAP
118 SBRC 85 Devonshire Street/258-262 NAP NAP NAP NAP
Washington Street
119 SBRC Centro De Distribucion del Norte NAP NAP NAP NAP
120 GCM 801 Boylston Street NAP NAP NAP NAP
121 LBNA 29200 Northwestern Highway NAP NAP NAP NAP
----------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio NAP NAP NAP NAP
122a 100 Market Street
122b 9 Executive Park Drive
122c 1255 South Willow Street
122d 135 Daniel Webster Highway
----------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton NAP NAP NAP NAP
124 LBNA GE / Montgomery Wards NAP NAP NAP NAP
- Col. Springs
125 LBNA GE / Montgomery Wards NAP NAP NAP NAP
- Pasadena Tx
126 SBRC US Storage Centers NAP NAP NAP NAP
127 LBNA Traders Tower - Self Park 05/01/97 09/30/06 NAP NAP
128 LBNA Mabek CO L.P. 06/05/94 07/31/08 NAP NAP
129 GCM Burlington Self Storage NAP NAP NAP NAP
130 GCM Boynton Plaza NAP NAP NAP NAP
131 SBRC 601-609 Mission Street NAP NAP NAP NAP
132 GCM Garden Ridge NAP NAP NAP NAP
133 GCM 300 West Pratt Street NAP NAP NAP NAP
134 GCM The GTE Building NAP NAP NAP NAP
135 GCM Hamlin Court NAP NAP NAP NAP
136 AMCC Telex Building NAP NAP NAP NAP
137 AMCC Charnelton Place Office Building NAP NAP NAP NAP
138 GCM Michael's Plaza NAP NAP NAP NAP
----------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments NAP NAP NAP NAP
& Cibola Village
139a Mountain Vista Apartments
139b Cibola Village
----------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center NAP NAP NAP NAP
141 GCM 300 West Hubbard Street Building NAP NAP NAP NAP
142 GCM 445 North Wells Street Building NAP NAP NAP NAP
143 GCM Miracle Mile Business Center 05/01/05 01/31/10 NAP NAP
144 GCM Folsom Self-Storage NAP NAP NAP NAP
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN YIELD MAINTENANCE YIELD MAINTENANCE
NUMBER SELLER LOAN/PROPERTY NAME CALCULATION METHOD INTEREST RATE
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
101 SBRC One Financial Place NAP NAP
102 LBNA Medical Mutual of Ohio NAP NAP
103 LBNA Jorie Plaza NAP NAP
104 GCM Westland Meadows NAP NAP
105 GCM Stonegate One NAP NAP
106 SBRC 149 New Montgomery Street NAP NAP
107 LBNA 101 West Grand NAP NAP
108 LBNA 57 W. Grand NAP NAP
109 LBNA 40 West Hubbard NAP NAP
110 LBNA South Loop Market Place NAP NAP
111 GCM Granite State Marketplace NAP NAP
112 GCM Pacific Plaza NAP NAP
113 SBRC Seatac Village Shopping Center NAP NAP
114 LBNA Seattle-Mead Industrial Facilities NAP NAP
115 LBNA Hamilton Court Apartments NAP NAP
116 GCM Webster Building NAP NAP
117 SBRC Amerix Building NAP NAP
118 SBRC 85 Devonshire Street/258-262 NAP NAP
Washington Street
119 SBRC Centro De Distribucion del Norte NAP NAP
120 GCM 801 Boylston Street NAP NAP
121 LBNA 29200 Northwestern Highway NAP NAP
---------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio NAP NAP
122a 100 Market Street
122b 9 Executive Park Drive
122c 1255 South Willow Street
122d 135 Daniel Webster Highway
---------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton NAP NAP
124 LBNA GE / Montgomery Wards NAP NAP
- Col. Springs
125 LBNA GE / Montgomery Wards NAP NAP
- Pasadena Tx
126 SBRC US Storage Centers NAP NAP
127 LBNA Traders Tower - Self Park Present Value Treasury Flat-Maturity
128 LBNA Mabek CO L.P. Present Value Treasury Flat-Maturity
129 GCM Burlington Self Storage NAP NAP
130 GCM Boynton Plaza NAP NAP
131 SBRC 601-609 Mission Street NAP NAP
132 GCM Garden Ridge NAP NAP
133 GCM 300 West Pratt Street NAP NAP
134 GCM The GTE Building NAP NAP
135 GCM Hamlin Court NAP NAP
136 AMCC Telex Building NAP NAP
137 AMCC Charnelton Place Office Building NAP NAP
138 GCM Michael's Plaza NAP NAP
---------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments NAP NAP
& Cibola Village
139a Mountain Vista Apartments
139b Cibola Village
---------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center NAP NAP
141 GCM 300 West Hubbard Street Building NAP NAP
142 GCM 445 North Wells Street Building NAP NAP
143 GCM Miracle Mile Business Center Interest Differential Treasury Flat-Maturity
144 GCM Folsom Self-Storage NAP NAP
</TABLE>
<PAGE> 205
MORTGAGE LOAN PREPAYMENT INFORMATION
<TABLE>
<CAPTION>
LOCKOUT DEFEASE- DEFEASE-
MORTGAGE PERIOD ANCE ANCE
CONTROL LOAN END START END
NUMBER SELLER LOAN/PROPERTY NAME PREPAYMENT PROVISIONS DATE DATE DATE
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments LO(40)/Defeasance(77)/Free(3) 12/31/02 01/01/03 05/31/09
146 LBNA Carriage House Lofts LO(35)/Defeasance(82)/Free(3) 11/30/03 12/01/03 09/30/10
147 GCM Northpointe Shopping Center LO(59)/Grtr1%UPBorYM(57)/Free(4) 09/30/05 NAP NAP
148 GCM 2 Willow Street LO(59)/Grtr1%UPBorYM(58)/Free(3) 08/31/05 NAP NAP
149 SBRC Villa de Mission East LO(31)/Defeasance(86)/Free(3) 12/31/02 01/01/03 02/28/10
150 GCM Calaveras Landing Shopping Center LO(33)/Defeasance(83)/Free(4) 12/31/02 01/01/03 11/30/09
151 GCM Healtheon LO(31)/Defeasance(85)/Free(4) 12/31/02 01/01/03 01/31/10
152 GCM 444 North Wells Street Building LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
153 GCM 1600 Corporate Center Drive LO(28)/Defeasance(88)/Free(4) 12/31/02 01/01/03 04/30/10
156 SBRC Town Green at Wilton Center LO(29)/Defeasance(88)/Free(3) 12/31/02 01/01/03 04/30/10
154 GCM Little Creek Apartments LO(26)/Defeasance(90)/Free(4) 12/31/02 01/01/03 06/30/10
155 GCM 271 - 285 East Fordham Road LO(37)/Defeasance(79)/Free(4) 12/31/02 01/01/03 07/31/09
157 GCM El Dorado Plaza LO(26)/Defeasance(90)/Free(4) 12/31/02 01/01/03 06/30/10
158 SBRC Tivoli Gardens Apartments LO(36)/Defeasance(81)/Free(3) 12/31/02 01/01/03 09/30/09
159 SBRC 155 Washington Ave LO(38)/Defeasance(79)/Free(3) 12/31/02 01/01/03 07/31/09
160 SBRC 370 Convention Way LO(30)/Defeasance(51)/Free(3) 12/31/02 01/01/03 03/31/07
161 GCM Union Landing Retail Center LO(31)/Defeasance(85)/Free(4) 12/31/02 01/01/03 01/31/10
162 GCM Briarwood Apartments LO(26)/Defeasance(87)/Free(7) 12/31/02 01/01/03 03/31/10
163 SBRC Franklinton Square Shopping Center LO(31)/Defeasance(86)/Free(3) 12/31/02 01/01/03 02/28/10
164 GCM Conquistador Apartments LO(40)/Defeasance(76)/Free(4) 12/31/02 01/01/03 04/30/09
165 GCM Greenhill Corporate Center LO(26)/Defeasance(90)/Free(4) 12/31/02 01/01/03 06/30/10
166 GCM Northridge Apartments LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
167 GCM Red Coach Village Apartments LO(31)/Defeasance(85)/Free(4) 12/31/02 01/01/03 01/31/10
168 AMCC K-Mart Shopping Center - Savannah LO(60)/Defeasance(56)/Free(4) 01/31/05 02/01/05 09/30/09
169 SBRC The Cascades LO(39)/Defeasance(78)/Free(3) 12/31/02 01/01/03 06/30/09
170 GCM The Trane Company Building LO(31)/Defeasance(85)/Free(4) 12/31/02 01/01/03 01/31/10
171 LBNA Chandler's Building LO(35)/Defeasance(81)/Free(4) 04/30/03 05/01/03 01/31/10
172 AMCC K-Mart Shopping Center - Nashville LO(60)/Defeasance(56)/Free(4) 01/31/05 02/01/05 09/30/09
173 AMCC 2150 Joshua's Path LO(59)/Grtr1%UPBorYM(57)/Free(4) 11/30/04 NAP NAP
174 AMCC Ver-Sa-Til LO(60)/Defeasance(56)/Free(4) 07/31/04 08/01/04 03/31/09
175 LBNA Springdale Mall LO(35)/Defeasance(82)/Free(3) 09/30/03 10/01/03 07/31/10
176 LBNA Frontier Commons/Global Crossing LO(35)/Defeasance(82)/Free(3) 06/30/03 07/01/03 04/30/10
177 GCM Wythe Shopping Center LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
178 AMCC Pencader Corporate Center LO(59)/Grtr1%UPBorYM(57)/Free(4) 06/30/04 NAP NAP
179 LBNA Watermark Office Building LO(35)/Defeasance(106)/Free(3) 09/30/03 10/01/03 07/31/12
180 GCM 801 West Diversey Parkway LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
181 GCM Lafayette Business Park LO(33)/Defeasance(83)/Free(4) 12/31/02 01/01/03 11/30/09
182 GCM Arrow Business Center LO(26)/Defeasance(90)/Free(4) 12/31/02 01/01/03 06/30/10
183 LBNA Palm Haven Mobile Home Park LO(35)/Defeasance(82)/Free(3) 06/30/03 07/01/03 04/30/10
184 AMCC Cedar Marketplace LO(37)/Defeasance(79)/Free(4) 12/31/02 01/01/03 07/31/09
185 GCM Crossroads Professional Building LO(26)/Defeasance(87)/Free(7) 12/31/02 01/01/03 03/31/10
186 LBNA Imperial Crown Center LO(35)/Defeasance(82)/Free(3) 11/30/03 12/01/03 09/30/10
187 GCM Fran Murphy Building LO(26)/Defeasance(90)/Free(4) 12/31/02 01/01/03 06/30/10
188 GCM Walgreen's - South Medford LO(25)/Defeasance(91)/Free(4) 12/31/02 01/01/03 07/31/10
189 GCM Sav-on and Carl's Jr. LO(27)/Defeasance(89)/Free(4) 12/31/02 01/01/03 05/31/10
190 AMCC The Shops at Enon Springs LO(60)/Defeasance(56)/Free(4) 05/31/05 06/01/05 01/31/10
191 AMCC Sierra Heartland Senior Apartments LO(60)/Defeasance(56)/Free(4) 08/31/05 09/01/05 04/30/10
192 GCM Weatherbridge Center Buildings II and III LO(28)/Defeasance(148)/Free(4) 12/31/02 01/01/03 04/30/15
</TABLE>
<TABLE>
<CAPTION>
YIELD YIELD
MAINTEN- MAINTEN- PREPAY- PREPAY-
ANCE ANCE MENT MENT
MORTGAGE PERIOD PERIOD PENALTY PENALTY
CONTROL LOAN START END START END
NUMBER SELLER LOAN/PROPERTY NAME DATE DATE DATE DATE
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments NAP NAP NAP NAP
146 LBNA Carriage House Lofts NAP NAP NAP NAP
147 GCM Northpointe Shopping Center 10/01/05 06/30/10 NAP NAP
148 GCM 2 Willow Street 09/01/05 06/30/10 NAP NAP
149 SBRC Villa de Mission East NAP NAP NAP NAP
150 GCM Calaveras Landing Shopping Center NAP NAP NAP NAP
151 GCM Healtheon NAP NAP NAP NAP
152 GCM 444 North Wells Street Building NAP NAP NAP NAP
153 GCM 1600 Corporate Center Drive NAP NAP NAP NAP
156 SBRC Town Green at Wilton Center NAP NAP NAP NAP
154 GCM Little Creek Apartments NAP NAP NAP NAP
155 GCM 271 - 285 East Fordham Road NAP NAP NAP NAP
157 GCM El Dorado Plaza NAP NAP NAP NAP
158 SBRC Tivoli Gardens Apartments NAP NAP NAP NAP
159 SBRC 155 Washington Ave NAP NAP NAP NAP
160 SBRC 370 Convention Way NAP NAP NAP NAP
161 GCM Union Landing Retail Center NAP NAP NAP NAP
162 GCM Briarwood Apartments NAP NAP NAP NAP
163 SBRC Franklinton Square Shopping Center NAP NAP NAP NAP
164 GCM Conquistador Apartments NAP NAP NAP NAP
165 GCM Greenhill Corporate Center NAP NAP NAP NAP
166 GCM Northridge Apartments NAP NAP NAP NAP
167 GCM Red Coach Village Apartments NAP NAP NAP NAP
168 AMCC K-Mart Shopping Center - Savannah NAP NAP NAP NAP
169 SBRC The Cascades NAP NAP NAP NAP
170 GCM The Trane Company Building NAP NAP NAP NAP
171 LBNA Chandler's Building NAP NAP NAP NAP
172 AMCC K-Mart Shopping Center - Nashville NAP NAP NAP NAP
173 AMCC 2150 Joshua's Path 12/01/04 08/31/09 NAP NAP
174 AMCC Ver-Sa-Til NAP NAP NAP NAP
175 LBNA Springdale Mall NAP NAP NAP NAP
176 LBNA Frontier Commons/Global Crossing NAP NAP NAP NAP
177 GCM Wythe Shopping Center NAP NAP NAP NAP
178 AMCC Pencader Corporate Center 07/01/04 03/31/09 NAP NAP
179 LBNA Watermark Office Building NAP NAP NAP NAP
180 GCM 801 West Diversey Parkway NAP NAP NAP NAP
181 GCM Lafayette Business Park NAP NAP NAP NAP
182 GCM Arrow Business Center NAP NAP NAP NAP
183 LBNA Palm Haven Mobile Home Park NAP NAP NAP NAP
184 AMCC Cedar Marketplace NAP NAP NAP NAP
185 GCM Crossroads Professional Building NAP NAP NAP NAP
186 LBNA Imperial Crown Center NAP NAP NAP NAP
187 GCM Fran Murphy Building NAP NAP NAP NAP
188 GCM Walgreen's - South Medford NAP NAP NAP NAP
189 GCM Sav-on and Carl's Jr. NAP NAP NAP NAP
190 AMCC The Shops at Enon Springs NAP NAP NAP NAP
191 AMCC Sierra Heartland Senior Apartments NAP NAP NAP NAP
192 GCM Weatherbridge Center Buildings II and III NAP NAP NAP NAP
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN YIELD MAINTENANCE YIELD MAINTENANCE
NUMBER SELLER LOAN/PROPERTY NAME CALCULATION METHOD INTEREST RATE
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments NAP NAP
146 LBNA Carriage House Lofts NAP NAP
147 GCM Northpointe Shopping Center Interest Differential Treasury Flat-Maturity
148 GCM 2 Willow Street Interest Differential Treasury Flat-Maturity
149 SBRC Villa de Mission East NAP NAP
150 GCM Calaveras Landing Shopping Center NAP NAP
151 GCM Healtheon NAP NAP
152 GCM 444 North Wells Street Building NAP NAP
153 GCM 1600 Corporate Center Drive NAP NAP
156 SBRC Town Green at Wilton Center NAP NAP
154 GCM Little Creek Apartments NAP NAP
155 GCM 271 - 285 East Fordham Road NAP NAP
157 GCM El Dorado Plaza NAP NAP
158 SBRC Tivoli Gardens Apartments NAP NAP
159 SBRC 155 Washington Ave NAP NAP
160 SBRC 370 Convention Way NAP NAP
161 GCM Union Landing Retail Center NAP NAP
162 GCM Briarwood Apartments NAP NAP
163 SBRC Franklinton Square Shopping Center NAP NAP
164 GCM Conquistador Apartments NAP NAP
165 GCM Greenhill Corporate Center NAP NAP
166 GCM Northridge Apartments NAP NAP
167 GCM Red Coach Village Apartments NAP NAP
168 AMCC K-Mart Shopping Center - Savannah NAP NAP
169 SBRC The Cascades NAP NAP
170 GCM The Trane Company Building NAP NAP
171 LBNA Chandler's Building NAP NAP
172 AMCC K-Mart Shopping Center - Nashville NAP NAP
173 AMCC 2150 Joshua's Path Present Value Treasury Flat-WAL
174 AMCC Ver-Sa-Til NAP NAP
175 LBNA Springdale Mall NAP NAP
176 LBNA Frontier Commons/Global Crossing NAP NAP
177 GCM Wythe Shopping Center NAP NAP
178 AMCC Pencader Corporate Center Present Value Treasury Flat-WAL
179 LBNA Watermark Office Building NAP NAP
180 GCM 801 West Diversey Parkway NAP NAP
181 GCM Lafayette Business Park NAP NAP
182 GCM Arrow Business Center NAP NAP
183 LBNA Palm Haven Mobile Home Park NAP NAP
184 AMCC Cedar Marketplace NAP NAP
185 GCM Crossroads Professional Building NAP NAP
186 LBNA Imperial Crown Center NAP NAP
187 GCM Fran Murphy Building NAP NAP
188 GCM Walgreen's - South Medford NAP NAP
189 GCM Sav-on and Carl's Jr. NAP NAP
190 AMCC The Shops at Enon Springs NAP NAP
191 AMCC Sierra Heartland Senior Apartments NAP NAP
192 GCM Weatherbridge Center Buildings II and III NAP NAP
</TABLE>
<PAGE> 206
MORTGAGE LOAN PREPAYMENT INFORMATION
<TABLE>
<CAPTION>
LOCKOUT DEFEASE- DEFEASE-
MORTGAGE PERIOD ANCE ANCE
CONTROL LOAN END START END
NUMBER SELLER LOAN/PROPERTY NAME PREPAYMENT PROVISIONS DATE DATE DATE
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem LO(30)/Defeasance(87)/Free(3) 12/31/02 01/01/03 03/31/10
194 GCM 1201 Sharp Street LO(35)/Defeasance(81)/Free(4) 12/31/02 01/01/03 09/30/09
195 AMCC RPS Warehouse LO(60)/Defeasance(56)/Free(4) 08/31/05 09/01/05 04/30/10
196 AMCC 755 & 775 Fiero Lane LO(59)/Defeasance(57)/Free(4) 02/28/05 03/01/05 11/30/09
197 GCM Redondo Tower Apartments LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
198 AMCC Plaza II Office Building LO(60)/Defeasance(56)/Free(4) 09/30/04 10/01/04 05/31/09
199 LBNA Fountain Place Apartments LO(39)/Defeasance(78)/Free(3) 12/31/02 01/01/03 06/30/09
200 AMCC Carriage House Apartment LO(59)/Grtr1%UPBorYM(177)/Free(4) 03/31/04 NAP NAP
- Sioux Falls
201 AMCC Carriage House Apartment LO(59)/Grtr1%UPBorYM(177)/Free(4) 03/31/04 NAP NAP
- Brookings
202 AMCC Carriage House Apartment LO(59)/Grtr1%UPBorYM(177)/Free(4) 03/31/04 NAP NAP
- Pierre
203 GCM Pioneer Point Apartments LO(41)/Defeasance(78)/Free(1) 12/31/02 01/01/03 06/30/09
204 AMCC CVS Harper Center LO(60)/Defeasance(56)/Free(4) 11/30/05 12/01/05 07/31/10
205 SBRC K-Mart Shopping Center LO(30)/Defeasance(207)/Free(3) 12/31/02 01/01/03 03/31/20
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
207 SBRC Broadway Plaza Building LO(29)/Defeasance(88)/Free(3) 12/31/02 01/01/03 04/30/10
208 SBRC 225 Long Avenue LO(28)/Defeasance(90)/Free(2) 12/31/02 01/01/03 06/30/10
209 LBNA Almond Grand Gurnee Grtr1%UPBorYM(67)/Free(3) NAP NAP NAP
210 GCM Summit/Breckenridge Apartments LO(33)/Defeasance(83)/Free(4) 12/31/02 01/01/03 11/30/09
211 GCM Peppertree Apartments LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
212 GCM Hillmount Apartments LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
213 AMCC 1500 Renaissance Building LO(59)/Defeasance(57)/Free(4) 04/30/05 05/01/05 01/31/10
214 AMCC Etinuum Office Building LO(60)/Defeasance(56)/Free(4) 11/30/05 12/01/05 07/31/10
215 AMCC DHR Office Building LO(59)/Grtr1%UPBorYM(57)/Free(4) 07/31/04 NAP NAP
216 GCM Oakwood Manor Apartments LO(32)/Defeasance(84)/Free(4) 12/31/02 01/01/03 12/31/09
217 GCM Woodbend Apartments LO(27)/Defeasance(86)/Free(7) 12/31/02 01/01/03 02/28/10
218 AMCC Warminster Shopping Center LO(59)/Grtr1%UPBorYM(57)/Free(4) 09/30/04 NAP NAP
219 AMCC PBR II LO(35)/Grtr1%UPBorYM(78)/Free(7) 08/31/01 NAP NAP
220 AMCC PBR I LO(35)/Grtr1%UPBorYM(78)/Free(7) 08/31/01 NAP NAP
221 GCM U-Stor Chambers Self-Storage LO(27)/Defeasance(89)/Free(4) 12/31/02 01/01/03 05/31/10
222 GCM 9925-9929 Jefferson Boulevard LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
223 AMCC 810-812 Fiero Lane LO(59)/Grtr1%UPBorYM(81)/Free(4) 07/31/04 NAP NAP
224 AMCC Lab Corp of America LO(59)/Grtr1%UPBorYM(57)/Free(4) 12/31/04 NAP NAP
225 LBNA Birchbrook Office Park LO(35)/Defeasance(82)/Free(3) 06/30/03 07/01/03 04/30/10
226 GCM Oro Valley Self Storage LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
227 AMCC Hillcrest Retail/Office Shopping Center LO(60)/Defeasance(56)/Free(4) 07/31/05 08/01/05 03/31/10
228 AMCC Cain Drive Warehouses LO(59)/Grtr1%UPBorYM(57)/Free(4) 06/30/04 NAP NAP
229 SBRC Mini-City Self Storage LO(28)/Defeasance(89)/Free(3) 12/31/02 01/01/03 05/31/10
230 AMCC Macy Building LO(59)/Grtr1%UPBorYM(57)/Free(4) 03/31/04 NAP NAP
231 GCM Senate Place Apartments LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
232 GCM Eastfield Townhouses LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
233 LBNA Kendall Manor Apartments LO(35)/Defeasance(82)/Free(3) 06/30/03 07/01/03 04/30/10
234 AMCC The Culver Building LO(59)/Grtr1%UPBorYM(57)/Free(4) 08/31/04 NAP NAP
235 AMCC Harvard Physicians Building LO(59)/Grtr1%UPBorYM(57)/Free(4) 07/31/04 NAP NAP
236 AMCC Lyon Street Retail LO(36)/5%(60)/4%(12)/3%(24)/ 08/31/01 NAP NAP
2%(12)/1%(35)/Free(1)
237 AMCC 350 Newton Avenue Apartments LO(59)/Grtr1%UPBorYM(55)/Free(6) 10/31/03 NAP NAP
238 AMCC Solar Gardens LO(59)/Grtr1%UPBorYM(57)/Free(4) 07/31/04 NAP NAP
239 AMCC Quality Suites Albuquerque LO(53)/Defeasance(119)/Free(61) 02/29/04 03/01/04 01/31/14
240 AMCC Springville Corners LO(60)/Grtr1%UPBorYM(56)/Free(4) 06/30/05 NAP NAP
241 AMCC 224-234 East Broad Street LO(59)/Grtr1%UPBorYM(66)/Free(7) 09/30/03 NAP NAP
242 GCM 6380 McLeod Drive LO(27)/Defeasance(89)/Free(4) 12/31/02 01/01/03 05/31/10
243 AMCC Black Mountain Point Office Building LO(59)/Grtr1%UPBorYM(54)/Free(7) 04/30/03 NAP NAP
244 AMCC Waste Management Building LO(60)/Grtr1%UPBorYM(56)/Free(4) 09/30/05 NAP NAP
245 AMCC Silver Lake Plaza LO(59)/Grtr1%UPBorYM(57)/Free(4) 11/30/04 NAP NAP
246 AMCC Checkmate Apartments LO(36)/Defeasance(80)/Free(4) 09/30/02 10/01/02 05/31/09
247 AMCC Creekside Center LO(60)/Defeasance(56)/Free(4) 10/31/05 11/01/05 06/30/10
248 AMCC Tolt Towne Center LO(23)/Grtr1%UPBorYM(90)/Free(7) 07/31/00 NAP NAP
249 AMCC South Fridley Apartments LO(59)/Grtr1%UPBorYM(177)/Free(4) 09/30/03 NAP NAP
250 GCM 6668 Owens Drive LO(31)/Defeasance(85)/Free(4) 12/31/02 01/01/03 01/31/10
251 GCM 6320 - 6330 McLeod Drive LO(30)/Defeasance(86)/Free(4) 12/31/02 01/01/03 02/28/10
252 GCM Rite Aid - Hillside LO(42)/Defeasance(158)/Free(4) 12/31/02 01/01/03 02/29/16
253 AMCC Howard Johnson Lake Havasu LO(52)/Defeasance(119)/Free(61) 01/31/04 02/01/04 12/31/13
254 LBNA Wickiup Mobile Home & RV Park LO(47)/Defeasance(72)/Free(1) 08/31/04 09/01/04 08/31/10
255 AMCC 261 East 300 South LO(59)/Grtr1%UPBorYM(57)/Free(4) 06/30/04 NAP NAP
</TABLE>
<TABLE>
<CAPTION>
YIELD YIELD
MAINTEN- MAINTEN- PREPAY- PREPAY-
ANCE ANCE MENT MENT
MORTGAGE PERIOD PERIOD PENALTY PENALTY
CONTROL LOAN START END START END
NUMBER SELLER LOAN/PROPERTY NAME DATE DATE DATE DATE
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem NAP NAP NAP NAP
194 GCM 1201 Sharp Street NAP NAP NAP NAP
195 AMCC RPS Warehouse NAP NAP NAP NAP
196 AMCC 755 & 775 Fiero Lane NAP NAP NAP NAP
197 GCM Redondo Tower Apartments NAP NAP NAP NAP
198 AMCC Plaza II Office Building NAP NAP NAP NAP
199 LBNA Fountain Place Apartments NAP NAP NAP NAP
200 AMCC Carriage House Apartment 04/01/04 12/31/18 NAP NAP
- Sioux Falls
201 AMCC Carriage House Apartment 04/01/04 12/31/18 NAP NAP
- Brookings
202 AMCC Carriage House Apartment 04/01/04 12/31/18 NAP NAP
- Pierre
203 GCM Pioneer Point Apartments NAP NAP NAP NAP
204 AMCC CVS Harper Center NAP NAP NAP NAP
205 SBRC K-Mart Shopping Center NAP NAP NAP NAP
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive NAP NAP NAP NAP
207 SBRC Broadway Plaza Building NAP NAP NAP NAP
208 SBRC 225 Long Avenue NAP NAP NAP NAP
209 LBNA Almond Grand Gurnee 10/01/00 04/30/06 NAP NAP
210 GCM Summit/Breckenridge Apartments NAP NAP NAP NAP
211 GCM Peppertree Apartments NAP NAP NAP NAP
212 GCM Hillmount Apartments NAP NAP NAP NAP
213 AMCC 1500 Renaissance Building NAP NAP NAP NAP
214 AMCC Etinuum Office Building NAP NAP NAP NAP
215 AMCC DHR Office Building 08/01/04 04/30/09 NAP NAP
216 GCM Oakwood Manor Apartments NAP NAP NAP NAP
217 GCM Woodbend Apartments NAP NAP NAP NAP
218 AMCC Warminster Shopping Center 10/01/04 06/30/09 NAP NAP
219 AMCC PBR II 09/01/01 02/29/08 NAP NAP
220 AMCC PBR I 09/01/01 02/29/08 NAP NAP
221 GCM U-Stor Chambers Self-Storage NAP NAP NAP NAP
222 GCM 9925-9929 Jefferson Boulevard NAP NAP NAP NAP
223 AMCC 810-812 Fiero Lane 08/01/04 04/30/11 NAP NAP
224 AMCC Lab Corp of America 01/01/05 09/30/09 NAP NAP
225 LBNA Birchbrook Office Park NAP NAP NAP NAP
226 GCM Oro Valley Self Storage NAP NAP NAP NAP
227 AMCC Hillcrest Retail/Office Shopping Center NAP NAP NAP NAP
228 AMCC Cain Drive Warehouses 07/01/04 03/31/09 NAP NAP
229 SBRC Mini-City Self Storage NAP NAP NAP NAP
230 AMCC Macy Building 04/01/04 12/31/08 NAP NAP
231 GCM Senate Place Apartments NAP NAP NAP NAP
232 GCM Eastfield Townhouses NAP NAP NAP NAP
233 LBNA Kendall Manor Apartments NAP NAP NAP NAP
234 AMCC The Culver Building 09/01/04 05/31/09 NAP NAP
235 AMCC Harvard Physicians Building 08/01/04 04/30/09 NAP NAP
236 AMCC Lyon Street Retail NAP NAP 09/01/01 07/31/13
237 AMCC 350 Newton Avenue Apartments 11/01/03 05/31/08 NAP NAP
238 AMCC Solar Gardens 08/01/04 04/30/09 NAP NAP
239 AMCC Quality Suites Albuquerque NAP NAP NAP NAP
240 AMCC Springville Corners 07/01/05 02/28/10 NAP NAP
241 AMCC 224-234 East Broad Street 10/01/03 03/31/09 NAP NAP
242 GCM 6380 McLeod Drive NAP NAP NAP NAP
243 AMCC Black Mountain Point Office Building 05/01/03 10/31/07 NAP NAP
244 AMCC Waste Management Building 10/01/05 05/31/10 NAP NAP
245 AMCC Silver Lake Plaza 12/01/04 08/31/09 NAP NAP
246 AMCC Checkmate Apartments NAP NAP NAP NAP
247 AMCC Creekside Center NAP NAP NAP NAP
248 AMCC Tolt Towne Center 08/01/00 01/31/08 NAP NAP
249 AMCC South Fridley Apartments 10/01/03 06/30/18 NAP NAP
250 GCM 6668 Owens Drive NAP NAP NAP NAP
251 GCM 6320 - 6330 McLeod Drive NAP NAP NAP NAP
252 GCM Rite Aid - Hillside NAP NAP NAP NAP
253 AMCC Howard Johnson Lake Havasu NAP NAP NAP NAP
254 LBNA Wickiup Mobile Home & RV Park NAP NAP NAP NAP
255 AMCC 261 East 300 South 07/01/04 03/31/09 NAP NAP
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN YIELD MAINTENANCE YIELD MAINTENANCE
NUMBER SELLER LOAN/PROPERTY NAME CALCULATION METHOD INTEREST RATE
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem NAP NAP
194 GCM 1201 Sharp Street NAP NAP
195 AMCC RPS Warehouse NAP NAP
196 AMCC 755 & 775 Fiero Lane NAP NAP
197 GCM Redondo Tower Apartments NAP NAP
198 AMCC Plaza II Office Building NAP NAP
199 LBNA Fountain Place Apartments NAP NAP
200 AMCC Carriage House Apartment Present Value Treasury Flat-WAL
- Sioux Falls
201 AMCC Carriage House Apartment Present Value Treasury Flat-WAL
- Brookings
202 AMCC Carriage House Apartment Present Value Treasury Flat-WAL
- Pierre
203 GCM Pioneer Point Apartments NAP NAP
204 AMCC CVS Harper Center NAP NAP
205 SBRC K-Mart Shopping Center NAP NAP
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive NAP NAP
207 SBRC Broadway Plaza Building NAP NAP
208 SBRC 225 Long Avenue NAP NAP
209 LBNA Almond Grand Gurnee Present Value Treasury Flat-Maturity
210 GCM Summit/Breckenridge Apartments NAP NAP
211 GCM Peppertree Apartments NAP NAP
212 GCM Hillmount Apartments NAP NAP
213 AMCC 1500 Renaissance Building NAP NAP
214 AMCC Etinuum Office Building NAP NAP
215 AMCC DHR Office Building Present Value Treasury Flat-WAL
216 GCM Oakwood Manor Apartments NAP NAP
217 GCM Woodbend Apartments NAP NAP
218 AMCC Warminster Shopping Center Present Value Treasury Flat-WAL
219 AMCC PBR II Present Value Treasury Flat-WAL
220 AMCC PBR I Present Value Treasury Flat-WAL
221 GCM U-Stor Chambers Self-Storage NAP NAP
222 GCM 9925-9929 Jefferson Boulevard NAP NAP
223 AMCC 810-812 Fiero Lane Present Value Treasury Flat-WAL
224 AMCC Lab Corp of America Present Value Treasury Flat-WAL
225 LBNA Birchbrook Office Park NAP NAP
226 GCM Oro Valley Self Storage NAP NAP
227 AMCC Hillcrest Retail/Office Shopping Center NAP NAP
228 AMCC Cain Drive Warehouses Present Value Treasury Flat-WAL
229 SBRC Mini-City Self Storage NAP NAP
230 AMCC Macy Building Present Value Treasury Flat-WAL
231 GCM Senate Place Apartments NAP NAP
232 GCM Eastfield Townhouses NAP NAP
233 LBNA Kendall Manor Apartments NAP NAP
234 AMCC The Culver Building Present Value Treasury Flat-WAL
235 AMCC Harvard Physicians Building Present Value Treasury Flat-WAL
236 AMCC Lyon Street Retail NAP NAP
237 AMCC 350 Newton Avenue Apartments Present Value Treasury Flat-WAL
238 AMCC Solar Gardens Present Value Treasury Flat-WAL
239 AMCC Quality Suites Albuquerque NAP NAP
240 AMCC Springville Corners Present Value Treasury Flat-WAL
241 AMCC 224-234 East Broad Street Present Value Treasury Flat-WAL
242 GCM 6380 McLeod Drive NAP NAP
243 AMCC Black Mountain Point Office Building Present Value Treasury Flat-WAL
244 AMCC Waste Management Building Present Value Treasury Flat-WAL
245 AMCC Silver Lake Plaza Present Value Treasury Flat-WAL
246 AMCC Checkmate Apartments NAP NAP
247 AMCC Creekside Center NAP NAP
248 AMCC Tolt Towne Center Present Value Treasury Flat-WAL
249 AMCC South Fridley Apartments Present Value Treasury Flat-WAL
250 GCM 6668 Owens Drive NAP NAP
251 GCM 6320 - 6330 McLeod Drive NAP NAP
252 GCM Rite Aid - Hillside NAP NAP
253 AMCC Howard Johnson Lake Havasu NAP NAP
254 LBNA Wickiup Mobile Home & RV Park NAP NAP
255 AMCC 261 East 300 South Present Value Treasury Flat-WAL
</TABLE>
<PAGE> 207
MORTGAGE LOAN PREPAYMENT INFORMATION
<TABLE>
<CAPTION>
LOCKOUT DEFEASE- DEFEASE-
MORTGAGE PERIOD ANCE ANCE
CONTROL LOAN END START END
NUMBER SELLER LOAN/PROPERTY NAME PREPAYMENT PROVISIONS DATE DATE DATE
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments LO(59)/Grtr1%UPBorYM(177)/Free(4) 11/30/03 NAP NAP
257 AMCC Hawthorne Business Park LO(60)/Defeasance(56)/Free(4) 11/30/05 12/01/05 07/31/10
258 GCM Nogales Self Storage LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
259 GCM Glendale West Self Storage LO(29)/Defeasance(87)/Free(4) 12/31/02 01/01/03 03/31/10
260 AMCC Lovell Building LO(59)/Grtr1%UPBorYM(57)/Free(4) 07/31/04 NAP NAP
261 AMCC Nationwide Insurance Office Building LO(59)/Grtr1%UPBorYM(57)/Free(4) 02/29/04 NAP NAP
262 AMCC Attache Building LO(59)/Grtr1%UPBorYM(57)/Free(4) 10/31/03 NAP NAP
263 GCM Airport Business Center LO(38)/Defeasance(78)/Free(4) 12/31/02 01/01/03 06/30/09
264 AMCC Bluebonnet Apartments LO(59)/Grtr1%UPBorYM(57)/Free(4) 12/31/04 NAP NAP
265 AMCC 8th Street Apartments LO(36)/Defeasance(80)/Free(4) 09/30/02 10/01/02 05/31/09
266 LBNA E. M. Jorgensen Building LO(35)/Defeasance(82)/Free(3) 06/30/03 07/01/03 04/30/10
267 AMCC Ralph's Grocery & Deli LO(59)/Grtr1%UPBorYM(78)/Free(7) 06/30/03 NAP NAP
268 AMCC Market Square LO(60)/Grtr1%UPBorYM(56)/Free(4) 03/31/04 NAP NAP
269 AMCC Blockbuster Video-Salt Lake City LO(59)/Grtr1%UPBorYM(57)/Free(4) 08/31/03 NAP NAP
270 AMCC Prudential Wise-McIntire Office Building LO(60)/Grtr1%UPBorYM(56)/Free(4) 10/31/03 NAP NAP
271 AMCC Licton Springs Court Apartments LO(59)/Grtr1%UPBorYM(57)/Free(4) 06/30/03 NAP NAP
272 AMCC Surgicenter of South Bay LO(59)/Grtr1%UPBorYM(55)/Free(6) 07/31/03 NAP NAP
273 AMCC West Fargo Living Center LO(59)/Grtr1%UPBorYM(54)/Free(7) 09/30/03 NAP NAP
274 AMCC Edgewood Apartments LO(59)/Grtr1%UPBorYM(177)/Free(4) 05/31/04 NAP NAP
275 AMCC Washington/Shepherd Retail Center LO(59)/Grtr1%UPBorYM(117)/Free(4) 10/31/03 NAP NAP
276 AMCC Candlewood Apartments LO(59)/Grtr1%UPBorYM(60)/Free(1) 03/31/02 NAP NAP
277 AMCC Bishop Lifting Products LO(59)/Grtr1%UPBorYM(57)/Free(4) 03/31/04 NAP NAP
278 AMCC 188 State Street LO(59)/Grtr1%UPBorYM(57)/Free(4) 11/30/03 NAP NAP
279 AMCC Woodstone Properties LO(35)/Grtr1%UPBorYM(138)/Free(7) 07/31/01 NAP NAP
280 AMCC East Gate Manor Apartments LO(36)/Defeasance(80)/Free(4) 01/31/03 02/01/03 09/30/09
</TABLE>
<TABLE>
<CAPTION>
YIELD YIELD
MAINTEN- MAINTEN- PREPAY- PREPAY-
ANCE ANCE MENT MENT
MORTGAGE PERIOD PERIOD PENALTY PENALTY
CONTROL LOAN START END START END
NUMBER SELLER LOAN/PROPERTY NAME DATE DATE DATE DATE
----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 12/01/03 08/31/18 NAP NAP
257 AMCC Hawthorne Business Park NAP NAP NAP NAP
258 GCM Nogales Self Storage NAP NAP NAP NAP
259 GCM Glendale West Self Storage NAP NAP NAP NAP
260 AMCC Lovell Building 08/01/04 04/30/09 NAP NAP
261 AMCC Nationwide Insurance Office Building 03/01/04 11/30/08 NAP NAP
262 AMCC Attache Building 11/01/03 07/31/08 NAP NAP
263 GCM Airport Business Center NAP NAP NAP NAP
264 AMCC Bluebonnet Apartments 01/01/05 09/30/09 NAP NAP
265 AMCC 8th Street Apartments NAP NAP NAP NAP
266 LBNA E. M. Jorgensen Building NAP NAP NAP NAP
267 AMCC Ralph's Grocery & Deli 07/01/03 12/31/09 NAP NAP
268 AMCC Market Square 04/01/04 11/30/08 NAP NAP
269 AMCC Blockbuster Video-Salt Lake City 09/01/03 05/31/08 NAP NAP
270 AMCC Prudential Wise-McIntire Office Building 11/01/03 06/30/08 NAP NAP
271 AMCC Licton Springs Court Apartments 07/01/03 03/31/08 NAP NAP
272 AMCC Surgicenter of South Bay 08/01/03 02/29/08 NAP NAP
273 AMCC West Fargo Living Center 10/01/03 03/31/08 NAP NAP
274 AMCC Edgewood Apartments 06/01/04 02/28/19 NAP NAP
275 AMCC Washington/Shepherd Retail Center 11/01/03 07/31/13 NAP NAP
276 AMCC Candlewood Apartments 04/01/02 03/31/07 NAP NAP
277 AMCC Bishop Lifting Products 04/01/04 12/31/08 NAP NAP
278 AMCC 188 State Street 12/01/03 08/31/08 NAP NAP
279 AMCC Woodstone Properties 08/01/01 01/31/13 NAP NAP
280 AMCC East Gate Manor Apartments NAP NAP NAP NAP
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN YIELD MAINTENANCE YIELD MAINTENANCE
NUMBER SELLER LOAN/PROPERTY NAME CALCULATION METHOD INTEREST RATE
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments Present Value Treasury Flat-WAL
257 AMCC Hawthorne Business Park NAP NAP
258 GCM Nogales Self Storage NAP NAP
259 GCM Glendale West Self Storage NAP NAP
260 AMCC Lovell Building Present Value Treasury Flat-WAL
261 AMCC Nationwide Insurance Office Building Present Value Treasury Flat-WAL
262 AMCC Attache Building Present Value Treasury Flat-WAL
263 GCM Airport Business Center NAP NAP
264 AMCC Bluebonnet Apartments Present Value Treasury Flat-WAL
265 AMCC 8th Street Apartments NAP NAP
266 LBNA E. M. Jorgensen Building NAP NAP
267 AMCC Ralph's Grocery & Deli Present Value Treasury Flat-WAL
268 AMCC Market Square Present Value Treasury Flat-WAL
269 AMCC Blockbuster Video-Salt Lake City Present Value Treasury Flat-WAL
270 AMCC Prudential Wise-McIntire Office Building Present Value Treasury Flat-WAL
271 AMCC Licton Springs Court Apartments Present Value Treasury Flat-WAL
272 AMCC Surgicenter of South Bay Present Value Treasury Flat-WAL
273 AMCC West Fargo Living Center Present Value Treasury Flat-WAL
274 AMCC Edgewood Apartments Present Value Treasury Flat-WAL
275 AMCC Washington/Shepherd Retail Center Present Value Treasury Flat-WAL
276 AMCC Candlewood Apartments Present Value Treasury-WAL+0.50%
277 AMCC Bishop Lifting Products Present Value Treasury Flat-WAL
278 AMCC 188 State Street Present Value Treasury Flat-WAL
279 AMCC Woodstone Properties Present Value Treasury Flat-WAL
280 AMCC East Gate Manor Apartments NAP NAP
</TABLE>
<PAGE> 208
Mortgaged Real Property Tenancy Information
<TABLE>
<CAPTION>
Mortgage Occupancy
Control Loan Occupancy as of
Number Seller Loan / Property Name Percentage Date Largest Tenant
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 95% 03/13/00 Chicago Stock Exchange
102 LBNA Medical Mutual of Ohio 100% 09/30/00 Medical Mutual of OH
103 LBNA Jorie Plaza 100% 11/07/00 Ameritech Information System
104 GCM Westland Meadows 99% 08/23/00 NAP
105 GCM Stonegate One 100% 09/15/00 Lockheed Martin Corporation
106 SBRC 149 New Montgomery Street 100% 06/30/00 E-Greetings Network
107 LBNA 101 West Grand 100% 09/30/00 Brinker International (Maggiano's)
108 LBNA 57 W. Grand 100% 09/30/00 Williams Labadie, LLC
109 LBNA 40 West Hubbard 100% 09/30/00 Prime Steak Chicago
110 LBNA South Loop Market Place 100% 08/30/00 Dominick's Foods
111 GCM Granite State Marketplace 98% 10/01/00 Wal-Mart Stores, Inc.
112 GCM Pacific Plaza 95% 07/13/00 ShopExpert.Com
113 SBRC Seatac Village Shopping Center 100% 06/01/00 Linens N' Things
114 LBNA Seattle-Mead Industrial Facilities 100% 09/30/00 Danzas Corporation
115 LBNA Hamilton Court Apartments 95% 09/30/00 NAP
116 GCM Webster Building 100% 06/30/00 The District of Columbia
117 SBRC Amerix Building 100% 08/01/00 Amerix Corp.
118 SBRC 85 Devonshire Street/258-262 Washington Street 95% 06/30/00 The Patricia Seybold Group
119 SBRC Centro De Distribucion del Norte 100% 09/22/00 Nestle Puerto Rico, Inc.
120 GCM 801 Boylston Street 88% 06/30/00 Fidelity Brokerage Services, Inc.
121 LBNA 29200 Northwestern Highway 100% 11/01/00 Engineering Services Group
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio
122a 100 Market Street 100% 09/01/00 Prudential
122b 9 Executive Park Drive 100% 06/30/00 Transparent Language, Inc.
122c 1255 South Willow Street 100% 06/30/00 Bank of New Hampshire
122d 135 Daniel Webster Highway 100% 06/30/00 Fleet Bank
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 73% 06/30/00 NAP
124 LBNA GE / Montgomery Wards 100% 08/09/00 GE / Montgomery Wards
- Col. Springs
125 LBNA GE / Montgomery Wards 100% 08/10/00 GE / Montgomery Wards
- Pasadena Tx
126 SBRC US Storage Centers 99% 07/31/00 NAP
127 LBNA Traders Tower - Self Park 90% 09/27/00 NAP
128 LBNA Mabek CO L.P. 100% 12/31/99 Tenneco Automotive Inc.
129 GCM Burlington Self Storage 95% 07/27/00 NAP
130 GCM Boynton Plaza 95% 09/11/00 Publix
131 SBRC 601-609 Mission Street 100% 08/01/00 Wet Feet.Com, Inc.
132 GCM Garden Ridge 100% 07/11/00 Garden Ridge, L.P.
133 GCM 300 West Pratt Street 97% 06/30/00 Henninger Media Services, Inc.
134 GCM The GTE Building 100% 09/19/00 GTE California, Inc.
135 GCM Hamlin Court 100% 08/01/00 Scient Corporation
136 AMCC Telex Building 100% 10/01/00 Telex Communications, Inc.
137 AMCC Charnelton Place Office Building 100% 08/31/00 GSA-Bankruptcy Court/Public Defenders
138 GCM Michael's Plaza 94% 08/01/00 Michael's
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments
& Cibola Village
139a Mountain Vista Apartments 90% 06/30/00 NAP
139b Cibola Village 96% 06/30/00 NAP
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 100% 06/01/00 Univ. Of Michigan
141 GCM 300 West Hubbard Street Building 100% 06/30/00 Davis, Conder, Enderle & Sloan
142 GCM 445 North Wells Street Building 99% 06/30/00 Urban Innovations Ltd.
143 GCM Miracle Mile Business Center 100% 09/12/00 Fabe Litho Ltd
144 GCM Folsom Self-Storage 89% 07/25/00 NAP
</TABLE>
<TABLE>
<CAPTION>
Largest
Tenant
Mortgage Largest Largest Lease
Control Loan Tenant Tenant Maturity
Number Seller Loan / Property Name NRSF NRSF% Date
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 222,468 22% 04/30/05
102 LBNA Medical Mutual of Ohio 381,176 100% 09/30/20
103 LBNA Jorie Plaza 69,455 36% 08/31/07
104 GCM Westland Meadows NAP NAP NAP
105 GCM Stonegate One 142,477 100% 12/31/07
106 SBRC 149 New Montgomery Street 76,687 96% 08/31/09
107 LBNA 101 West Grand 24,886 34% 03/31/11
108 LBNA 57 W. Grand 19,685 24% 09/30/05
109 LBNA 40 West Hubbard 9,692 76% 08/31/02
110 LBNA South Loop Market Place 71,373 70% 10/31/17
111 GCM Granite State Marketplace 82,550 33% 12/08/10
112 GCM Pacific Plaza 8,213 10% 08/31/02
113 SBRC Seatac Village Shopping Center 33,009 20% 01/31/14
114 LBNA Seattle-Mead Industrial Facilities 29,815 13% 06/18/05
115 LBNA Hamilton Court Apartments NAP NAP NAP
116 GCM Webster Building 136,270 100% 08/31/09
117 SBRC Amerix Building 154,394 100% 12/31/16
118 SBRC 85 Devonshire Street/258-262 Washington Street 8,540 9% 11/30/02
119 SBRC Centro De Distribucion del Norte 96,093 29% 04/30/04
120 GCM 801 Boylston Street 8,900 33% 11/30/14
121 LBNA 29200 Northwestern Highway 68,033 61% 08/31/07
--------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio
122a 100 Market Street 8,700 17% 01/31/05
122b 9 Executive Park Drive 27,325 100% 06/30/04
122c 1255 South Willow Street 7,820 100% 01/31/09
122d 135 Daniel Webster Highway 5,210 70% 09/30/02
--------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton NAP NAP NAP
124 LBNA GE / Montgomery Wards 161,986 100% 07/31/09
- Col. Springs
125 LBNA GE / Montgomery Wards 193,006 100% 09/30/10
- Pasadena Tx
126 SBRC US Storage Centers NAP NAP NAP
127 LBNA Traders Tower - Self Park NAP NAP NAP
128 LBNA Mabek CO L.P. 93,000 100% 10/31/11
129 GCM Burlington Self Storage NAP NAP NAP
130 GCM Boynton Plaza 36,464 37% 08/31/03
131 SBRC 601-609 Mission Street 14,000 31% 03/31/02
132 GCM Garden Ridge 122,400 100% 02/28/19
133 GCM 300 West Pratt Street 8,674 14% 04/30/05
134 GCM The GTE Building 107,920 100% 12/15/08
135 GCM Hamlin Court 24,868 58% 10/31/04
136 AMCC Telex Building 114,100 100% 05/15/10
137 AMCC Charnelton Place Office Building 32,490 57% 07/31/04
138 GCM Michael's Plaza 27,000 40% 01/31/03
--------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments
& Cibola Village
139a Mountain Vista Apartments NAP NAP NAP
139b Cibola Village NAP NAP NAP
--------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 39,441 85% 04/30/03
141 GCM 300 West Hubbard Street Building 8,897 34% 11/30/02
142 GCM 445 North Wells Street Building 5,269 17% 12/31/02
143 GCM Miracle Mile Business Center 71,244 61% 04/30/13
144 GCM Folsom Self-Storage NAP NAP NAP
</TABLE>
<TABLE>
<CAPTION>
Second
Mortgage Largest
Control Loan Tenant
Number Seller Loan / Property Name Second Largest Tenant NRSF
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
101 SBRC One Financial Place First Options 105,413
102 LBNA Medical Mutual of Ohio NAP NAP
103 LBNA Jorie Plaza Nextlink Illinois 55,061
104 GCM Westland Meadows NAP NAP
105 GCM Stonegate One NAP NAP
106 SBRC 149 New Montgomery Street Utrecht Manufacturing Corporation 3,063
107 LBNA 101 West Grand Court House Executive Offices 21,362
108 LBNA 57 W. Grand Chicago Art Production 16,500
109 LBNA 40 West Hubbard Robert I and Harold Briskma 2,980
110 LBNA South Loop Market Place Kinko's 5,644
111 GCM Granite State Marketplace Shaw's Supermarkets, Inc. 48,394
112 GCM Pacific Plaza American Technology Funding, Inc. dba 5,027
AccessLease.Com and Access Capital
113 SBRC Seatac Village Shopping Center TJ Maxx 25,705
114 LBNA Seattle-Mead Industrial Facilities Kinetsu World Express, Inc. 29,232
115 LBNA Hamilton Court Apartments NAP NAP
116 GCM Webster Building NAP NAP
117 SBRC Amerix Building NAP NAP
118 SBRC 85 Devonshire Street/258-262 Tomcat Enterprise 8,143
Washington Street
119 SBRC Centro De Distribucion del Norte CC 1 LP (Coca-Cola Distributor) 72,550
120 GCM 801 Boylston Street Priscilla of Boston 5,750
121 LBNA 29200 Northwestern Highway Air Express International 21,119
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio
122a 100 Market Street Taylor Research & Consulting 7,000
122b 9 Executive Park Drive NAP NAP
122c 1255 South Willow Street NAP NAP
122d 135 Daniel Webster Highway Kelly Insurance Agency 2,221
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton NAP NAP
124 LBNA GE / Montgomery Wards NAP NAP
- Col. Springs
125 LBNA GE / Montgomery Wards NAP NAP
- Pasadena Tx
126 SBRC US Storage Centers NAP NAP
127 LBNA Traders Tower - Self Park NAP NAP
128 LBNA Mabek CO L.P. NAP NAP
129 GCM Burlington Self Storage NAP NAP
130 GCM Boynton Plaza Eckerd's 10,800
131 SBRC 601-609 Mission Street Business for Social Responsibility 14,000
132 GCM Garden Ridge NAP NAP
133 GCM 300 West Pratt Street Israelson, Salsbury, Clements and Bekman LLC 8,004
134 GCM The GTE Building NAP NAP
135 GCM Hamlin Court Empatheon, Inc. 18,000
136 AMCC Telex Building NAP NAP
137 AMCC Charnelton Place Office Building Pacific Women's Center, L.L.C. 5,928
138 GCM Michael's Plaza Lamps Plus 9,970
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments
& Cibola Village
139a Mountain Vista Apartments NAP NAP
139b Cibola Village NAP NAP
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center Detroit Osteopathic Radiology 6,826
141 GCM 300 West Hubbard Street Building Geiger International 6,722
142 GCM 445 North Wells Street Building Mastercraft 4,306
143 GCM Miracle Mile Business Center EPS International, LLC 25,147
144 GCM Folsom Self-Storage NAP NAP
</TABLE>
<TABLE>
<CAPTION>
Second
Largest
Second Tenant
Mortgage Largest Lease
Control Loan Tenant Maturity
Number Seller Loan / Property Name NRSF% Date
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
101 SBRC One Financial Place 10% 02/28/03
102 LBNA Medical Mutual of Ohio NAP NAP
103 LBNA Jorie Plaza 29% 04/21/08
104 GCM Westland Meadows NAP NAP
105 GCM Stonegate One NAP NAP
106 SBRC 149 New Montgomery Street 4% 10/31/04
107 LBNA 101 West Grand 29% 09/30/05
108 LBNA 57 W. Grand 20% 03/31/02
109 LBNA 40 West Hubbard 24% 09/30/01
110 LBNA South Loop Market Place 6% 02/28/08
111 GCM Granite State Marketplace 19% 11/08/13
112 GCM Pacific Plaza 6% 05/31/05
113 SBRC Seatac Village Shopping Center 16% 01/31/02
114 LBNA Seattle-Mead Industrial Facilities 12% 04/11/04
115 LBNA Hamilton Court Apartments NAP NAP
116 GCM Webster Building NAP NAP
117 SBRC Amerix Building NAP NAP
118 SBRC 85 Devonshire Street/258-262 Washington Street 9% 12/31/03
119 SBRC Centro De Distribucion del Norte 22% 08/31/02
120 GCM 801 Boylston Street 21% 11/30/09
121 LBNA 29200 Northwestern Highway 19% 08/31/06
--------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio
122a 100 Market Street 14% 05/31/04
122b 9 Executive Park Drive NAP NAP
122c 1255 South Willow Street NAP NAP
122d 135 Daniel Webster Highway 30% 03/31/03
--------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton NAP NAP
124 LBNA GE / Montgomery Wards NAP NAP
- Col. Springs
125 LBNA GE / Montgomery Wards NAP NAP
- Pasadena Tx
126 SBRC US Storage Centers NAP NAP
127 LBNA Traders Tower - Self Park NAP NAP
128 LBNA Mabek CO L.P. NAP NAP
129 GCM Burlington Self Storage NAP NAP
130 GCM Boynton Plaza 11% 12/07/01
131 SBRC 601-609 Mission Street 31% 06/30/03
132 GCM Garden Ridge NAP NAP
133 GCM 300 West Pratt Street 13% 11/30/00
134 GCM The GTE Building NAP NAP
135 GCM Hamlin Court 42% 04/30/05
136 AMCC Telex Building NAP NAP
137 AMCC Charnelton Place Office Building 10% 12/31/01
138 GCM Michael's Plaza 15% 04/30/02
--------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments
& Cibola Village
139a Mountain Vista Apartments NAP NAP
139b Cibola Village NAP NAP
--------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 15% 09/30/03
141 GCM 300 West Hubbard Street Building 26% 01/31/02
142 GCM 445 North Wells Street Building 14% 05/31/05
143 GCM Miracle Mile Business Center 22% 05/31/05
144 GCM Folsom Self-Storage NAP NAP
</TABLE>
<PAGE> 209
Mortgaged Real Property Tenancy Information
<TABLE>
<CAPTION>
Mortgage Occupancy
Control Loan Occupancy as of
Number Seller Loan / Property Name Percentage Date Largest Tenant
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 95% 07/16/00 NAP
146 LBNA Carriage House Lofts 100% 09/30/00 NAP
147 GCM Northpointe Shopping Center 95% 08/01/00 Mars, Inc.
148 GCM 2 Willow Street 100% 08/01/00 Massachusetts Dental Society
149 SBRC Villa de Mission East 94% 06/20/00 NAP
150 GCM Calaveras Landing Shopping Center 100% 09/07/00 Fleming Companies, Inc.
151 GCM Healtheon 100% 07/11/00 Healtheon Corporation
152 GCM 444 North Wells Street Building 100% 06/30/00 First Commonwealth
153 GCM 1600 Corporate Center Drive 100% 07/01/00 Entir Pacific Bell
156 SBRC Town Green at Wilton Center 100% 06/30/00 Wilton Post Office
154 GCM Little Creek Apartments 96% 10/01/00 NAP
155 GCM 271 - 285 East Fordham Road 100% 06/30/00 The GAP, Inc.
157 GCM El Dorado Plaza 98% 08/15/00 Staples Office Supply
158 SBRC Tivoli Gardens Apartments 92% 06/15/00 NAP
159 SBRC 155 Washington Ave 100% 07/05/00 Capital Health Plan
160 SBRC 370 Convention Way 100% 08/11/00 NewChannel, Inc.
161 GCM Union Landing Retail Center 100% 08/03/00 Office Max
162 GCM Briarwood Apartments 98% 09/30/00 NAP
163 SBRC Franklinton Square Shopping Center 98% 09/29/00 Food Lion
164 GCM Conquistador Apartments 96% 08/31/00 NAP
165 GCM Greenhill Corporate Center 100% 08/04/00 United Messaging, Inc.
166 GCM Northridge Apartments 94% 10/05/00 NAP
167 GCM Red Coach Village Apartments 99% 07/10/00 NAP
168 AMCC K-Mart Shopping Center - Savannah 100% 08/28/00 Kmart Corporation
169 SBRC The Cascades 87% 08/01/00 Time Customer Service
170 GCM The Trane Company Building 100% 07/27/00 The Trane Company
171 LBNA Chandler's Building 96% 11/01/00 IDEO
172 AMCC K-Mart Shopping Center - Nashville 100% 07/14/00 Kmart Corporation
173 AMCC 2150 Joshua's Path 92% 09/10/00 Wortman, Fumuso
174 AMCC Ver-Sa-Til 100% 05/05/00 Ver-Sa-Til Associates, Inc.
175 LBNA Springdale Mall 100% 06/29/00 Bradlee's
176 LBNA Frontier Commons/Global Crossing 100% 06/13/00 Frontier Telephone of Rochester, Inc.
177 GCM Wythe Shopping Center 100% 07/01/00 Acme Markets
178 AMCC Pencader Corporate Center 100% 09/13/00 J.C. Penney & Company
179 LBNA Watermark Office Building 95% 08/08/00 Time Warner Comm.
180 GCM 801 West Diversey Parkway 100% 08/08/00 Mattress Giant Corp.
181 GCM Lafayette Business Park 100% 08/14/00 Paragon Electronic Systems, Inc.
182 GCM Arrow Business Center 97% 09/15/00 GMS Elevator
183 LBNA Palm Haven Mobile Home Park 89% 10/01/00 NAP
184 AMCC Cedar Marketplace 100% 08/01/00 Archivers
185 GCM Crossroads Professional Building 93% 08/31/00 Whitman Walker Clinic, Inc.
186 LBNA Imperial Crown Center 98% 10/01/00 MidFlorida Credit Union
187 GCM Fran Murphy Building 100% 07/13/00 Fran Murphy Interiors, Inc.
188 GCM Walgreen's - South Medford 100% 09/29/00 Walgreens
189 GCM Sav-on and Carl's Jr. 100% 08/31/00 American Drug Stores, Inc.
190 AMCC The Shops at Enon Springs 96% 09/15/00 Fashion Bug
191 AMCC Sierra Heartland Senior Apartments 100% 08/01/00 NAP
192 GCM Weatherbridge Center Buildings II and III 83% 09/07/00 Town of Cary
</TABLE>
<TABLE>
<CAPTION>
Largest
Tenant
Mortgage Largest Largest Lease
Control Loan Tenant Tenant Maturity
Number Seller Loan / Property Name NRSF NRSF% Date
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments NAP NAP NAP
146 LBNA Carriage House Lofts NAP NAP NAP
147 GCM Northpointe Shopping Center 25,500 49% 06/18/10
148 GCM 2 Willow Street 20,000 50% 12/31/09
149 SBRC Villa de Mission East NAP NAP NAP
150 GCM Calaveras Landing Shopping Center 50,052 77% 07/27/08
151 GCM Healtheon 49,837 100% 01/31/08
152 GCM 444 North Wells Street Building 23,674 41% 05/31/03
153 GCM 1600 Corporate Center Drive 47,787 100% 10/31/06
156 SBRC Town Green at Wilton Center 10,800 31% 06/30/06
154 GCM Little Creek Apartments NAP NAP NAP
155 GCM 271 - 285 East Fordham Road 18,000 100% 03/04/05
157 GCM El Dorado Plaza 24,358 39% 03/31/07
158 SBRC Tivoli Gardens Apartments NAP NAP NAP
159 SBRC 155 Washington Ave 27,122 40% 12/31/08
160 SBRC 370 Convention Way 21,000 100% 02/28/06
161 GCM Union Landing Retail Center 23,500 61% 05/05/14
162 GCM Briarwood Apartments NAP NAP NAP
163 SBRC Franklinton Square Shopping Center 33,000 50% 02/23/19
164 GCM Conquistador Apartments NAP NAP NAP
165 GCM Greenhill Corporate Center 17,313 49% 01/14/06
166 GCM Northridge Apartments NAP NAP NAP
167 GCM Red Coach Village Apartments NAP NAP NAP
168 AMCC K-Mart Shopping Center - Savannah 111,043 100% 12/31/18
169 SBRC The Cascades 10,975 13% 05/31/01
170 GCM The Trane Company Building 50,157 100% 12/31/08
171 LBNA Chandler's Building 16,764 64% 12/31/09
172 AMCC K-Mart Shopping Center - Nashville 103,482 100% 12/31/18
173 AMCC 2150 Joshua's Path 10,000 21% 01/31/04
174 AMCC Ver-Sa-Til 107,795 100% 06/30/19
175 LBNA Springdale Mall 99,640 96% 12/15/03
176 LBNA Frontier Commons/Global Crossing 47,346 73% 05/30/05
177 GCM Wythe Shopping Center 45,882 46% 06/09/14
178 AMCC Pencader Corporate Center 79,184 100% 04/30/04
179 LBNA Watermark Office Building 31,850 73% 09/30/01
180 GCM 801 West Diversey Parkway 7,119 41% 09/26/06
181 GCM Lafayette Business Park 46,800 67% 07/31/05
182 GCM Arrow Business Center 5,460 6% 07/31/03
183 LBNA Palm Haven Mobile Home Park NAP NAP NAP
184 AMCC Cedar Marketplace 5,770 21% 08/31/04
185 GCM Crossroads Professional Building 5,970 12% 07/31/03
186 LBNA Imperial Crown Center 18,238 27% 12/31/04
187 GCM Fran Murphy Building 21,561 47% 05/31/12
188 GCM Walgreen's - South Medford 13,905 100% 06/30/59
189 GCM Sav-on and Carl's Jr. 16,747 85% 12/31/19
190 AMCC The Shops at Enon Springs 8,000 25% 01/31/05
191 AMCC Sierra Heartland Senior Apartments NAP NAP NAP
192 GCM Weatherbridge Center Buildings II and III 12,250 24% 01/12/03
</TABLE>
<TABLE>
<CAPTION>
Second
Mortgage Largest
Control Loan Tenant
Number Seller Loan / Property Name Second Largest Tenant NRSF
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments NAP NAP
146 LBNA Carriage House Lofts NAP NAP
147 GCM Northpointe Shopping Center Round Table Pizza 3,200
148 GCM 2 Willow Street RTS Software, Inc. 13,807
149 SBRC Villa de Mission East NAP NAP
150 GCM Calaveras Landing Shopping Center Rent-A-Center 5,284
151 GCM Healtheon NAP NAP
152 GCM 444 North Wells Street Building Promotions Unlimited, Inc. 8,164
153 GCM 1600 Corporate Center Drive NAP NAP
156 SBRC Town Green at Wilton Center Kreg Corporation 4,444
154 GCM Little Creek Apartments NAP NAP
155 GCM 271 - 285 East Fordham Road NAP NAP
157 GCM El Dorado Plaza Factory 2-U 15,400
158 SBRC Tivoli Gardens Apartments NAP NAP
159 SBRC 155 Washington Ave NYS Office of Children & Families Services 14,912
160 SBRC 370 Convention Way NAP NAP
161 GCM Union Landing Retail Center Party America 10,575
162 GCM Briarwood Apartments NAP NAP
163 SBRC Franklinton Square Shopping Center Family Dollar 8,000
164 GCM Conquistador Apartments NAP NAP
165 GCM Greenhill Corporate Center Doublestar, Inc. 11,945
166 GCM Northridge Apartments NAP NAP
167 GCM Red Coach Village Apartments NAP NAP
168 AMCC K-Mart Shopping Center - Savannah NAP NAP
169 SBRC The Cascades VA Clinic 6,466
170 GCM The Trane Company Building NAP NAP
171 LBNA Chandler's Building Davis Street Land Co. 3,395
172 AMCC K-Mart Shopping Center - Nashville NAP NAP
173 AMCC 2150 Joshua's Path CTC Communications 6,200
174 AMCC Ver-Sa-Til NAP NAP
175 LBNA Springdale Mall McDonald's 4,123
176 LBNA Frontier Commons/Global Crossing Store to Door 17,500
177 GCM Wythe Shopping Center Dollar General 7,487
178 AMCC Pencader Corporate Center NAP NAP
179 LBNA Watermark Office Building GSA-FDA 4,465
180 GCM 801 West Diversey Parkway Third Dunkin' Donuts Realty, Inc. 5,553
181 GCM Lafayette Business Park Komag Incorporated 23,400
182 GCM Arrow Business Center Women's Southern California Golf Association 4,032
183 LBNA Palm Haven Mobile Home Park NAP NAP
184 AMCC Cedar Marketplace Buffalo Wild Wings 5,600
185 GCM Crossroads Professional Building Community Clinic 4,623
186 LBNA Imperial Crown Center Willbros Engineering 10,000
187 GCM Fran Murphy Building California Design Group 6,825
188 GCM Walgreen's - South Medford NAP NAP
189 GCM Sav-on and Carl's Jr. Carl Karcher Enterprises, Inc. 3,000
190 AMCC The Shops at Enon Springs JD's Sports Grille 4,200
191 AMCC Sierra Heartland Senior Apartments NAP NAP
192 GCM Weatherbridge Center Buildings II and III Monterey Technologies, Inc. 6,238
</TABLE>
<TABLE>
<CAPTION>
Second
Largest
Second Tenant
Mortgage Largest Lease
Control Loan Tenant Maturity
Number Seller Loan / Property Name NRSF% Date
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments NAP NAP
146 LBNA Carriage House Lofts NAP NAP
147 GCM Northpointe Shopping Center 6% 12/31/00
148 GCM 2 Willow Street 35% 04/30/05
149 SBRC Villa de Mission East NAP NAP
150 GCM Calaveras Landing Shopping Center 8% 06/30/04
151 GCM Healtheon NAP NAP
152 GCM 444 North Wells Street Building 14% 12/31/01
153 GCM 1600 Corporate Center Drive NAP NAP
156 SBRC Town Green at Wilton Center 13% 08/31/03
154 GCM Little Creek Apartments NAP NAP
155 GCM 271 - 285 East Fordham Road NAP NAP
157 GCM El Dorado Plaza 25% 07/31/10
158 SBRC Tivoli Gardens Apartments NAP NAP
159 SBRC 155 Washington Ave 22% 12/31/08
160 SBRC 370 Convention Way NAP NAP
161 GCM Union Landing Retail Center 27% 03/15/09
162 GCM Briarwood Apartments NAP NAP
163 SBRC Franklinton Square Shopping Center 12% 12/31/09
164 GCM Conquistador Apartments NAP NAP
165 GCM Greenhill Corporate Center 34% 01/14/05
166 GCM Northridge Apartments NAP NAP
167 GCM Red Coach Village Apartments NAP NAP
168 AMCC K-Mart Shopping Center - Savannah NAP NAP
169 SBRC The Cascades 7% 09/01/01
170 GCM The Trane Company Building NAP NAP
171 LBNA Chandler's Building 13% 09/30/04
172 AMCC K-Mart Shopping Center - Nashville NAP NAP
173 AMCC 2150 Joshua's Path 13% 11/30/03
174 AMCC Ver-Sa-Til NAP NAP
175 LBNA Springdale Mall 4% 02/28/02
176 LBNA Frontier Commons/Global Crossing 27% 12/31/04
177 GCM Wythe Shopping Center 7% 07/31/03
178 AMCC Pencader Corporate Center NAP NAP
179 LBNA Watermark Office Building 10% 02/04/02
180 GCM 801 West Diversey Parkway 32% 12/29/09
181 GCM Lafayette Business Park 33% 04/30/03
182 GCM Arrow Business Center 4% 01/31/02
183 LBNA Palm Haven Mobile Home Park NAP NAP
184 AMCC Cedar Marketplace 21% 07/31/09
185 GCM Crossroads Professional Building 9% 08/31/03
186 LBNA Imperial Crown Center 15% 09/30/01
187 GCM Fran Murphy Building 15% 10/31/01
188 GCM Walgreen's - South Medford NAP NAP
189 GCM Sav-on and Carl's Jr. 15% 12/31/19
190 AMCC The Shops at Enon Springs 13% 09/30/04
191 AMCC Sierra Heartland Senior Apartments NAP NAP
192 GCM Weatherbridge Center Buildings II and III 12% 09/30/06
</TABLE>
<PAGE> 210
Mortgaged Real Property Tenancy Information
<TABLE>
<CAPTION>
Mortgage Occupancy
Control Loan Occupancy as of
Number Seller Loan / Property Name Percentage Date Largest Tenant
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem 100% 06/30/00 Kmart Corporation
194 GCM 1201 Sharp Street 92% 09/01/00 RMF Engineering, Inc.
195 AMCC RPS Warehouse 100% 06/05/00 RPS, Inc.
196 AMCC 755 & 775 Fiero Lane 100% 08/31/00 Phacor, Inc.
197 GCM Redondo Tower Apartments 98% 08/10/00 NAP
198 AMCC Plaza II Office Building 96% 07/18/00 Yakima MSA Partnership (US Cellular)
199 LBNA Fountain Place Apartments 98% 09/01/00 NAP
200 AMCC Carriage House Apartment 100% 08/16/00 NAP
- Sioux Falls
201 AMCC Carriage House Apartment 100% 08/01/00 NAP
- Brookings
202 AMCC Carriage House Apartment 100% 08/01/00 NAP
- Pierre
203 GCM Pioneer Point Apartments 93% 07/25/00 NAP
204 AMCC CVS Harper Center 100% 08/01/00 CVS Drug Store
205 SBRC K-Mart Shopping Center 100% 06/30/00 Kmart Corporation
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 97% 08/29/00 The Lending Edge, Inc.
207 SBRC Broadway Plaza Building 100% 09/22/00 AmerAsia WorldWide
208 SBRC 225 Long Avenue 100% 06/30/00 Manhattan Drug Company, Inc.
209 LBNA Almond Grand Gurnee 100% 06/16/00 Walgreens
210 GCM Summit/Breckenridge Apartments 97% 06/30/00 NAP
211 GCM Peppertree Apartments 96% 09/08/00 NAP
212 GCM Hillmount Apartments 95% 07/27/00 NAP
213 AMCC 1500 Renaissance Building 100% 04/14/00 IKON Office Solutions, Inc.
214 AMCC Etinuum Office Building 100% 08/29/00 Etinuum
215 AMCC DHR Office Building 100% 09/30/00 Oregon State Department of Human
Resources
216 GCM Oakwood Manor Apartments 97% 06/29/00 NAP
217 GCM Woodbend Apartments 94% 06/01/00 NAP
218 AMCC Warminster Shopping Center 95% 10/01/00 National Penn Bank
219 AMCC PBR II 100% 10/01/00 Helen L Langston
220 AMCC PBR I 100% 09/01/00 Hoag Memorial Hospital
221 GCM U-Stor Chambers Self-Storage 98% 06/21/00 NAP
222 GCM 9925-9929 Jefferson Boulevard 100% 08/31/00 Kovel/Fuller, LLC
223 AMCC 810-812 Fiero Lane 100% 08/31/00 The Grid
224 AMCC Lab Corp of America 100% 09/30/00 Laboratory Corporation of America
225 LBNA Birchbrook Office Park 94% 08/03/00 Parsec Automation
226 GCM Oro Valley Self Storage 75% 09/26/00 NAP
227 AMCC Hillcrest Retail/Office Shopping Center 100% 09/13/00 Donald L. Myers, CPA
228 AMCC Cain Drive Warehouses 100% 09/25/00 St. James Mechanical, Inc.
229 SBRC Mini-City Self Storage 75% 06/30/00 NAP
230 AMCC Macy Building 100% 09/20/00 Reez.com
231 GCM Senate Place Apartments 97% 08/13/00 NAP
232 GCM Eastfield Townhouses 100% 06/25/00 NAP
233 LBNA Kendall Manor Apartments 100% 08/01/00 NAP
234 AMCC The Culver Building 100% 08/31/00 Creative Domain
235 AMCC Harvard Physicians Building 97% 09/30/00 Hillcrest-Harvard, Inc.
236 AMCC Lyon Street Retail 100% 08/31/00 Grand Discount
237 AMCC 350 Newton Avenue Apartments 98% 10/01/00 NAP
238 AMCC Solar Gardens 90% 09/01/00 NAP
239 AMCC Quality Suites Albuquerque 73% 06/30/00 NAP
240 AMCC Springville Corners 100% 09/26/00 Aromatic dba Young Living Oils
241 AMCC 224-234 East Broad Street 100% 03/15/00 Gapkids
242 GCM 6380 McLeod Drive 100% 07/19/00 C.P. Communications
243 AMCC Black Mountain Point Office Building 100% 10/01/00 California Healthcare
244 AMCC Waste Management Building 100% 07/08/00 Waste Management, Inc.
245 AMCC Silver Lake Plaza 100% 08/28/00 Fashion Bug/Women's Apparel
246 AMCC Checkmate Apartments 100% 08/01/00 NAP
247 AMCC Creekside Center 100% 07/06/00 Dollar Tree
248 AMCC Tolt Towne Center 100% 09/01/00 QFC
249 AMCC South Fridley Apartments 98% 08/01/00 NAP
250 GCM 6668 Owens Drive 100% 07/07/00 H.E.C. Investments, Inc.
251 GCM 6320 - 6330 McLeod Drive 96% 08/29/00 Coriograham, Inc.
252 GCM Rite Aid - Hillside 100% 07/05/00 Rite Aid
253 AMCC Howard Johnson Lake Havasu 50% 06/30/00 NAP
254 LBNA Wickiup Mobile Home & RV Park 90% 08/10/00 NAP
255 AMCC 261 East 300 South 100% 03/31/00 Scalley & Reading
</TABLE>
<TABLE>
<CAPTION>
Largest
Tenant
Mortgage Largest Largest Lease
Control Loan Tenant Tenant Maturity
Number Seller Loan / Property Name NRSF NRSF% Date
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem 116,866 100% 01/31/04
194 GCM 1201 Sharp Street 28,496 60% 03/31/03
195 AMCC RPS Warehouse 63,633 100% 11/30/09
196 AMCC 755 & 775 Fiero Lane 15,400 35% 10/31/09
197 GCM Redondo Tower Apartments NAP NAP NAP
198 AMCC Plaza II Office Building 5,955 19% 09/30/05
199 LBNA Fountain Place Apartments NAP NAP NAP
200 AMCC Carriage House Apartment NAP NAP NAP
- Sioux Falls
201 AMCC Carriage House Apartment NAP NAP NAP
- Brookings
202 AMCC Carriage House Apartment NAP NAP NAP
- Pierre
203 GCM Pioneer Point Apartments NAP NAP NAP
204 AMCC CVS Harper Center 10,762 44% 05/31/10
205 SBRC K-Mart Shopping Center 106,880 100% 01/31/02
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 3,440 14% 03/31/02
207 SBRC Broadway Plaza Building 8,571 37% 03/01/05
208 SBRC 225 Long Avenue 74,898 48% 05/31/15
209 LBNA Almond Grand Gurnee 13,905 100% 12/31/16
210 GCM Summit/Breckenridge Apartments NAP NAP NAP
211 GCM Peppertree Apartments NAP NAP NAP
212 GCM Hillmount Apartments NAP NAP NAP
213 AMCC 1500 Renaissance Building 26,050 71% 01/31/06
214 AMCC Etinuum Office Building 35,501 100% 08/29/10
215 AMCC DHR Office Building 32,952 100% 09/30/05
216 GCM Oakwood Manor Apartments NAP NAP NAP
217 GCM Woodbend Apartments NAP NAP NAP
218 AMCC Warminster Shopping Center 3,000 11% 06/30/01
219 AMCC PBR II 3,100 11% 04/30/02
220 AMCC PBR I 6,287 24% 02/14/04
221 GCM U-Stor Chambers Self-Storage NAP NAP NAP
222 GCM 9925-9929 Jefferson Boulevard 38,764 100% 02/28/10
223 AMCC 810-812 Fiero Lane 19,560 62% 12/31/04
224 AMCC Lab Corp of America 26,800 100% 12/31/09
225 LBNA Birchbrook Office Park 6,055 25% 04/30/02
226 GCM Oro Valley Self Storage NAP NAP NAP
227 AMCC Hillcrest Retail/Office Shopping Center 3,465 18% 12/31/01
228 AMCC Cain Drive Warehouses 4,800 10% 08/31/02
229 SBRC Mini-City Self Storage NAP NAP NAP
230 AMCC Macy Building 12,335 58% 04/06/05
231 GCM Senate Place Apartments NAP NAP NAP
232 GCM Eastfield Townhouses NAP NAP NAP
233 LBNA Kendall Manor Apartments NAP NAP NAP
234 AMCC The Culver Building 8,696 38% 04/14/02
235 AMCC Harvard Physicians Building 14,973 48% 06/30/04
236 AMCC Lyon Street Retail 3,000 16% MTM
237 AMCC 350 Newton Avenue Apartments NAP NAP NAP
238 AMCC Solar Gardens NAP NAP NAP
239 AMCC Quality Suites Albuquerque NAP NAP NAP
240 AMCC Springville Corners 34,500 100% 04/30/05
241 AMCC 224-234 East Broad Street 5,330 58% 07/23/03
242 GCM 6380 McLeod Drive 2,884 14% 06/30/04
243 AMCC Black Mountain Point Office Building 13,167 38% 12/31/01
244 AMCC Waste Management Building 20,000 100% 07/27/10
245 AMCC Silver Lake Plaza 8,000 48% 01/31/09
246 AMCC Checkmate Apartments NAP NAP NAP
247 AMCC Creekside Center 4,800 32% 01/31/05
248 AMCC Tolt Towne Center 19,848 70% 08/12/06
249 AMCC South Fridley Apartments NAP NAP NAP
250 GCM 6668 Owens Drive 18,683 100% 07/31/02
251 GCM 6320 - 6330 McLeod Drive 2,040 13% 05/31/03
252 GCM Rite Aid - Hillside 16,079 100% 05/01/04
253 AMCC Howard Johnson Lake Havasu NAP NAP NAP
254 LBNA Wickiup Mobile Home & RV Park NAP NAP NAP
255 AMCC 261 East 300 South 7,940 34% 05/31/03
</TABLE>
<TABLE>
<CAPTION>
Second
Mortgage Largest
Control Loan Tenant
Number Seller Loan / Property Name Second Largest Tenant NRSF
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem NAP NAP
194 GCM 1201 Sharp Street AFSCME, Council 92 4,618
195 AMCC RPS Warehouse NAP NAP
196 AMCC 755 & 775 Fiero Lane Guayaki 7,561
197 GCM Redondo Tower Apartments NAP NAP
198 AMCC Plaza II Office Building New Northwest Broadcasters II, Inc. 5,434
199 LBNA Fountain Place Apartments NAP NAP
200 AMCC Carriage House Apartment NAP NAP
- Sioux Falls
201 AMCC Carriage House Apartment NAP NAP
- Brookings
202 AMCC Carriage House Apartment NAP NAP
- Pierre
203 GCM Pioneer Point Apartments NAP NAP
204 AMCC CVS Harper Center Blockbuster Video 7,500
205 SBRC K-Mart Shopping Center NAP NAP
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive Miracle Flights for Kids 2,840
207 SBRC Broadway Plaza Building Viawest 3,430
208 SBRC 225 Long Avenue M.W. International, Inc. 43,656
209 LBNA Almond Grand Gurnee NAP NAP
210 GCM Summit/Breckenridge Apartments NAP NAP
211 GCM Peppertree Apartments NAP NAP
212 GCM Hillmount Apartments NAP NAP
213 AMCC 1500 Renaissance Building I.E.S. Partnership 10,385
214 AMCC Etinuum Office Building NAP NAP
215 AMCC DHR Office Building NAP NAP
216 GCM Oakwood Manor Apartments NAP NAP
217 GCM Woodbend Apartments NAP NAP
218 AMCC Warminster Shopping Center Golden Palace, Inc 2,885
219 AMCC PBR II Rosewood Realty, LLC 3,100
220 AMCC PBR I Mike's Automotive 5,760
221 GCM U-Stor Chambers Self-Storage NAP NAP
222 GCM 9925-9929 Jefferson Boulevard NAP NAP
223 AMCC 810-812 Fiero Lane Science Kit 6,200
224 AMCC Lab Corp of America NAP NAP
225 LBNA Birchbrook Office Park Accord Human Resources 2,825
226 GCM Oro Valley Self Storage NAP NAP
227 AMCC Hillcrest Retail/Office Shopping Center Bella Notte Restaurant 2,520
228 AMCC Cain Drive Warehouses Heaven Scent Me, Inc. 3,200
229 SBRC Mini-City Self Storage NAP NAP
230 AMCC Macy Building Satellite Dialysis Centers, Inc. 9,075
231 GCM Senate Place Apartments NAP NAP
232 GCM Eastfield Townhouses NAP NAP
233 LBNA Kendall Manor Apartments NAP NAP
234 AMCC The Culver Building Signature Escrow 2,810
235 AMCC Harvard Physicians Building Hillcrest-Riverside, Inc. 2,779
236 AMCC Lyon Street Retail Pescado Mojado 2,500
237 AMCC 350 Newton Avenue Apartments NAP NAP
238 AMCC Solar Gardens NAP NAP
239 AMCC Quality Suites Albuquerque NAP NAP
240 AMCC Springville Corners NAP NAP
241 AMCC 224-234 East Broad Street Guillotine 1,350
242 GCM 6380 McLeod Drive Oasis Wholesale & Purchasing 2,622
243 AMCC Black Mountain Point Office Building Power & Industrial Design Corp 3,336
244 AMCC Waste Management Building NAP NAP
245 AMCC Silver Lake Plaza Corral West/Western Wear 7,092
246 AMCC Checkmate Apartments NAP NAP
247 AMCC Creekside Center One Price 4,200
248 AMCC Tolt Towne Center Sa Jung Park 2,992
249 AMCC South Fridley Apartments NAP NAP
250 GCM 6668 Owens Drive NAP NAP
251 GCM 6320 - 6330 McLeod Drive Logowear, LLC 1,895
252 GCM Rite Aid - Hillside NAP NAP
253 AMCC Howard Johnson Lake Havasu NAP NAP
254 LBNA Wickiup Mobile Home & RV Park NAP NAP
255 AMCC 261 East 300 South Utah Agency 4,046
</TABLE>
<TABLE>
<CAPTION>
Second
Largest
Second Tenant
Mortgage Largest Lease
Control Loan Tenant Maturity
Number Seller Loan / Property Name NRSF% Date
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem NAP NAP
194 GCM 1201 Sharp Street 10% 06/14/02
195 AMCC RPS Warehouse NAP NAP
196 AMCC 755 & 775 Fiero Lane 17% 04/30/02
197 GCM Redondo Tower Apartments NAP NAP
198 AMCC Plaza II Office Building 18% 06/30/09
199 LBNA Fountain Place Apartments NAP NAP
200 AMCC Carriage House Apartment NAP NAP
- Sioux Falls
201 AMCC Carriage House Apartment NAP NAP
- Brookings
202 AMCC Carriage House Apartment NAP NAP
- Pierre
203 GCM Pioneer Point Apartments NAP NAP
204 AMCC CVS Harper Center 30% 05/31/05
205 SBRC K-Mart Shopping Center NAP NAP
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 11% 12/31/02
207 SBRC Broadway Plaza Building 15% 04/01/05
208 SBRC 225 Long Avenue 28% 01/10/02
209 LBNA Almond Grand Gurnee NAP NAP
210 GCM Summit/Breckenridge Apartments NAP NAP
211 GCM Peppertree Apartments NAP NAP
212 GCM Hillmount Apartments NAP NAP
213 AMCC 1500 Renaissance Building 29% 01/31/04
214 AMCC Etinuum Office Building NAP NAP
215 AMCC DHR Office Building NAP NAP
216 GCM Oakwood Manor Apartments NAP NAP
217 GCM Woodbend Apartments NAP NAP
218 AMCC Warminster Shopping Center 10% 07/31/08
219 AMCC PBR II 11% 08/14/03
220 AMCC PBR I 22% 09/30/02
221 GCM U-Stor Chambers Self-Storage NAP NAP
222 GCM 9925-9929 Jefferson Boulevard NAP NAP
223 AMCC 810-812 Fiero Lane 20% 05/31/01
224 AMCC Lab Corp of America NAP NAP
225 LBNA Birchbrook Office Park 11% 12/31/00
226 GCM Oro Valley Self Storage NAP NAP
227 AMCC Hillcrest Retail/Office Shopping Center 13% 03/31/03
228 AMCC Cain Drive Warehouses 6% MTM
229 SBRC Mini-City Self Storage NAP NAP
230 AMCC Macy Building 42% 02/28/10
231 GCM Senate Place Apartments NAP NAP
232 GCM Eastfield Townhouses NAP NAP
233 LBNA Kendall Manor Apartments NAP NAP
234 AMCC The Culver Building 12% 07/31/10
235 AMCC Harvard Physicians Building 9% 11/30/02
236 AMCC Lyon Street Retail 13% 02/28/07
237 AMCC 350 Newton Avenue Apartments NAP NAP
238 AMCC Solar Gardens NAP NAP
239 AMCC Quality Suites Albuquerque NAP NAP
240 AMCC Springville Corners NAP NAP
241 AMCC 224-234 East Broad Street 15% 09/30/04
242 GCM 6380 McLeod Drive 13% 03/31/02
243 AMCC Black Mountain Point Office Building 10% 02/28/01
244 AMCC Waste Management Building NAP NAP
245 AMCC Silver Lake Plaza 43% 04/30/09
246 AMCC Checkmate Apartments NAP NAP
247 AMCC Creekside Center 28% 03/31/03
248 AMCC Tolt Towne Center 11% 12/01/00
249 AMCC South Fridley Apartments NAP NAP
250 GCM 6668 Owens Drive NAP NAP
251 GCM 6320 - 6330 McLeod Drive 12% 12/31/02
252 GCM Rite Aid - Hillside NAP NAP
253 AMCC Howard Johnson Lake Havasu NAP NAP
254 LBNA Wickiup Mobile Home & RV Park NAP NAP
255 AMCC 261 East 300 South 17% 01/31/02
</TABLE>
<PAGE> 211
Mortgaged Real Property Tenancy Information
<TABLE>
<CAPTION>
Mortgage Occupancy
Control Loan Occupancy as of
Number Seller Loan / Property Name Percentage Date Largest Tenant
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 93% 08/01/00 NAP
257 AMCC Hawthorne Business Park 100% 09/05/00 Electrorep, Inc.
258 GCM Nogales Self Storage 88% 09/01/00 NAP
259 GCM Glendale West Self Storage 95% 09/18/00 NAP
260 AMCC Lovell Building 97% 09/13/00 Lovell America, Inc.
261 AMCC Nationwide Insurance Office Building 100% 10/23/00 Nationwide Insurance Company
262 AMCC Attache Building 100% 11/01/00 Renaissance
263 GCM Airport Business Center 100% 09/26/00 Flight Services Group
264 AMCC Bluebonnet Apartments 99% 09/18/00 NAP
265 AMCC 8th Street Apartments 100% 08/01/00 NAP
266 LBNA E. M. Jorgensen Building 100% 10/12/00 E.M. Jorgensen
267 AMCC Ralph's Grocery & Deli 100% 10/03/00 Ralph's Grocery & Deli
268 AMCC Market Square 100% 09/30/00 Morgan's Market
269 AMCC Blockbuster Video-Salt Lake City 100% 08/31/00 Blockbuster Video
270 AMCC Prudential Wise-McIntire Office Building 100% 09/25/00 Wise McIntire, Inc.
271 AMCC Licton Springs Court Apartments 100% 08/31/00 NAP
272 AMCC Surgicenter of South Bay 100% 03/17/00 Surgicenter of South Bay
273 AMCC West Fargo Living Center 100% 09/30/00 NAP
274 AMCC Edgewood Apartments 100% 08/31/00 NAP
275 AMCC Washington/Shepherd Retail Center 100% 08/30/00 O'Reilly Auto Parts
276 AMCC Candlewood Apartments 100% 10/01/00 NAP
277 AMCC Bishop Lifting Products 100% 01/26/00 Bishop Lifting Products, Inc.
278 AMCC 188 State Street 100% 10/25/00 Aurora & Quanta Productions
279 AMCC Woodstone Properties 98% 09/01/00 NAP
280 AMCC East Gate Manor Apartments 91% 08/01/00 NAP
</TABLE>
<TABLE>
<CAPTION>
Largest
Tenant
Mortgage Largest Largest Lease
Control Loan Tenant Tenant Maturity
Number Seller Loan / Property Name NRSF NRSF% Date
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments NAP NAP NAP
257 AMCC Hawthorne Business Park 9,400 22% 04/30/03
258 GCM Nogales Self Storage NAP NAP NAP
259 GCM Glendale West Self Storage NAP NAP NAP
260 AMCC Lovell Building 6,102 30% 12/31/00
261 AMCC Nationwide Insurance Office Building 11,695 100% 03/31/04
262 AMCC Attache Building 2,789 27% 04/14/03
263 GCM Airport Business Center 8,500 35% 11/17/01
264 AMCC Bluebonnet Apartments NAP NAP NAP
265 AMCC 8th Street Apartments NAP NAP NAP
266 LBNA E. M. Jorgensen Building 31,035 100% 05/31/15
267 AMCC Ralph's Grocery & Deli 10,997 100% 07/31/09
268 AMCC Market Square 6,385 51% 11/30/07
269 AMCC Blockbuster Video-Salt Lake City 6,497 81% 08/31/06
270 AMCC Prudential Wise-McIntire Office Building 5,809 67% 10/31/08
271 AMCC Licton Springs Court Apartments NAP NAP NAP
272 AMCC Surgicenter of South Bay 9,330 100% 01/31/04
273 AMCC West Fargo Living Center NAP NAP NAP
274 AMCC Edgewood Apartments NAP NAP NAP
275 AMCC Washington/Shepherd Retail Center 10,800 57% 03/31/06
276 AMCC Candlewood Apartments NAP NAP NAP
277 AMCC Bishop Lifting Products 45,500 100% 11/30/08
278 AMCC 188 State Street 3,750 27% 04/14/03
279 AMCC Woodstone Properties NAP NAP NAP
280 AMCC East Gate Manor Apartments NAP NAP NAP
</TABLE>
<TABLE>
<CAPTION>
Second
Mortgage Largest
Control Loan Tenant
Number Seller Loan / Property Name Second Largest Tenant NRSF
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments NAP NAP
257 AMCC Hawthorne Business Park Team International, Inc. 7,040
258 GCM Nogales Self Storage NAP NAP
259 GCM Glendale West Self Storage NAP NAP
260 AMCC Lovell Building Eres Consultants, Inc. 2,460
261 AMCC Nationwide Insurance Office Building NAP NAP
262 AMCC Attache Building Inspired Lending 2,446
263 GCM Airport Business Center Thermion Systems International 5,000
264 AMCC Bluebonnet Apartments NAP NAP
265 AMCC 8th Street Apartments NAP NAP
266 LBNA E. M. Jorgensen Building NAP NAP
267 AMCC Ralph's Grocery & Deli NAP NAP
268 AMCC Market Square Sanctuary Spa 3,104
269 AMCC Blockbuster Video-Salt Lake City Papa Murphy's 1,478
270 AMCC Prudential Wise-McIntire Office Building Forefront, Inc. 2,865
271 AMCC Licton Springs Court Apartments NAP NAP
272 AMCC Surgicenter of South Bay NAP NAP
273 AMCC West Fargo Living Center NAP NAP
274 AMCC Edgewood Apartments NAP NAP
275 AMCC Washington/Shepherd Retail Center Eckerd's 8,269
276 AMCC Candlewood Apartments NAP NAP
277 AMCC Bishop Lifting Products NAP NAP
278 AMCC 188 State Street Day One 3,500
279 AMCC Woodstone Properties NAP NAP
280 AMCC East Gate Manor Apartments NAP NAP
</TABLE>
<TABLE>
<CAPTION>
Second
Largest
Second Tenant
Mortgage Largest Lease
Control Loan Tenant Maturity
Number Seller Loan / Property Name NRSF% Date
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments NAP NAP
257 AMCC Hawthorne Business Park 17% 01/31/03
258 GCM Nogales Self Storage NAP NAP
259 GCM Glendale West Self Storage NAP NAP
260 AMCC Lovell Building 12% 12/31/00
261 AMCC Nationwide Insurance Office Building NAP NAP
262 AMCC Attache Building 24% 06/30/03
263 GCM Airport Business Center 20% 09/30/02
264 AMCC Bluebonnet Apartments NAP NAP
265 AMCC 8th Street Apartments NAP NAP
266 LBNA E. M. Jorgensen Building NAP NAP
267 AMCC Ralph's Grocery & Deli NAP NAP
268 AMCC Market Square 25% 07/31/08
269 AMCC Blockbuster Video-Salt Lake City 19% 04/30/07
270 AMCC Prudential Wise-McIntire Office Building 33% 07/31/02
271 AMCC Licton Springs Court Apartments NAP NAP
272 AMCC Surgicenter of South Bay NAP NAP
273 AMCC West Fargo Living Center NAP NAP
274 AMCC Edgewood Apartments NAP NAP
275 AMCC Washington/Shepherd Retail Center 43% 10/23/05
276 AMCC Candlewood Apartments NAP NAP
277 AMCC Bishop Lifting Products NAP NAP
278 AMCC 188 State Street 25% 01/31/03
279 AMCC Woodstone Properties NAP NAP
280 AMCC East Gate Manor Apartments NAP NAP
</TABLE>
<PAGE> 212
<TABLE>
<CAPTION>
MORTGAGED REAL PROPERTY 1998 AND 1999 HISTORICAL FINANCIAL INFORMATION
1998 1998
MORTGAGE 1998 STATEMENT STATEMENT
CONTROL LOAN STATEMENT NUMBER OF ENDING 1998 1998
NUMBER SELLER LOAN / PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES
------ ------ -------------------- ---- ------ ---- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place Full Year 12 12/31/98 27,997,036 11,803,525
102 LBNA Medical Mutual of Ohio UAV UAV UAV UAV UAV
103 LBNA Jorie Plaza Full Year 12 12/31/98 3,055,204 934,426
104 GCM Westland Meadows Full Year 12 12/31/98 3,326,932 1,128,833
105 GCM Stonegate One UAV UAV UAV UAV UAV
106 SBRC 149 New Montgomery Street UAV UAV UAV UAV UAV
107 LBNA 101 West Grand Full Year 12 12/31/98 2,146,547 864,283
108 LBNA 57 W. Grand Full Year 12 12/31/98 1,275,313 620,522
109 LBNA 40 West Hubbard Full Year 12 12/31/98 643,730 131,154
110 LBNA South Loop Market Place Full Year 12 12/31/98 2,136,512 412,760
111 GCM Granite State Marketplace UAV UAV UAV UAV UAV
112 GCM Pacific Plaza UAV UAV UAV UAV UAV
113 SBRC Seatac Village Shopping Center Full Year 12 12/31/98 1,327,941 436,034
114 LBNA Seattle-Mead Industrial Facilities UAV UAV UAV UAV UAV
115 LBNA Hamilton Court Apartments Full Year 12 12/31/98 4,890,684 2,949,892
116 GCM Webster Building Full Year 12 12/31/98 1,738,188 857,242
117 SBRC Amerix Building UAV UAV UAV UAV UAV
118 SBRC 85 Devonshire Street/258-262 Full Year 12 12/31/98 1,571,334 778,705
Washington Street
119 SBRC Centro De Distribucion del Norte Full Year 12 12/31/98 1,761,871 414,064
120 GCM 801 Boylston Street UAV UAV UAV UAV UAV
121 LBNA 29200 Northwestern Highway Full Year 12 12/31/98 1,412,337 768,007
122 GCM Simchik Four Property Portfolio
122a 100 Market Street UAV UAV UAV UAV UAV
122b 9 Executive Park Drive Full Year 12 12/31/98 158,617 36,987
122c 1255 South Willow Street Full Year 12 12/31/98 105,514 41,774
122d 135 Daniel Webster Highway Full Year 12 12/31/98 142,339 48,350
123 GCM Four Points Hotel by Sheraton Full Year 12 12/31/98 4,145,409 2,355,694
124 LBNA GE / Montgomery Wards UAV UAV UAV UAV UAV
- Col. Springs
125 LBNA GE / Montgomery Wards UAV UAV UAV UAV UAV
- Pasadena Tx
126 SBRC US Storage Centers Annualized 11 12/31/98 979,947 316,610
127 LBNA Traders Tower - Self Park Full Year 12 12/31/98 2,073,822 659,871
128 LBNA Mabek CO L.P. Full Year 12 12/31/98 1,785,240 0
129 GCM Burlington Self Storage Full Year 12 12/31/98 1,259,261 441,015
130 GCM Boynton Plaza Full Year 12 12/31/98 1,469,504 427,655
131 SBRC 601-609 Mission Street UAV UAV UAV UAV UAV
132 GCM Garden Ridge UAV UAV UAV UAV UAV
133 GCM 300 West Pratt Street Full Year 12 12/31/98 1,205,881 378,726
134 GCM The GTE Building UAV UAV UAV UAV UAV
135 GCM Hamlin Court UAV UAV UAV UAV UAV
136 AMCC Telex Building UAV UAV UAV UAV UAV
137 AMCC Charnelton Place Office Building Full Year 12 12/31/98 1,158,950 600,240
138 GCM Michael's Plaza Full Year 12 12/31/98 1,094,950 285,682
139 GCM Mountain Vista Apartments
& Cibola Village
139a Mountain Vista Apartments Full Year 12 12/31/98 1,174,078 718,428
139b Cibola Village Full Year 12 12/31/98 689,611 376,645
140 LBNA Horizon Health Center Full Year 12 12/31/98 1,320,267 442,905
141 GCM 300 West Hubbard Street Building Full Year 12 12/31/98 840,620 278,202
142 GCM 445 North Wells Street Building Full Year 12 12/31/98 660,187 356,901
143 GCM Miracle Mile Business Center Full Year 12 12/31/98 345,041 127,025
144 GCM Folsom Self-Storage UAV UAV UAV UAV UAV
</TABLE>
<TABLE>
<CAPTION>
MORTGAGED REAL PROPERTY 1998 AND 1999 HISTORICAL FINANCIAL INFORMATION
1999 1999
MORTGAGE 1999 STATEMENT STATEMENT
CONTROL LOAN 1998 STATEMENT NUMBER OF ENDING 1999
NUMBER SELLER LOAN / PROPERTY NAME 1998 NOI NOI DSCR TYPE MONTHS DATE REVENUES
------ ------ -------------------- -------- -------- ---- ------ ---- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 16,193,511 1.55 Full Year 12 12/30/99 30,559,657
102 LBNA Medical Mutual of Ohio UAV UAV UAV UAV UAV UAV
103 LBNA Jorie Plaza 2,120,778 1.02 Full Year 12 12/31/99 4,048,852
104 GCM Westland Meadows 2,198,099 1.12 Full Year 12 12/31/99 3,610,822
105 GCM Stonegate One UAV UAV UAV UAV UAV UAV
106 SBRC 149 New Montgomery Street UAV UAV UAV UAV UAV UAV
107 LBNA 101 West Grand 1,282,264 1.57 Full Year 12 12/31/99 2,108,813
108 LBNA 57 W. Grand 654,791 1.57 Full Year 12 12/31/99 1,272,218
109 LBNA 40 West Hubbard 512,576 1.57 Full Year 12 12/31/99 643,351
110 LBNA South Loop Market Place 1,723,752 1.15 Full Year 12 12/31/99 2,709,925
111 GCM Granite State Marketplace UAV UAV Full Year 12 12/31/99 2,481,986
112 GCM Pacific Plaza UAV UAV Full Year 12 12/31/99 1,784,759
113 SBRC Seatac Village Shopping Center 891,907 0.65 Annualized 11 12/31/99 2,389,588
114 LBNA Seattle-Mead Industrial Facilities UAV UAV Full Year 12 12/31/99 1,020,000
115 LBNA Hamilton Court Apartments 1,940,792 1.43 Full Year 12 12/31/99 5,041,227
116 GCM Webster Building 880,946 0.60 Full Year 12 12/31/99 2,248,311
117 SBRC Amerix Building UAV UAV UAV UAV UAV UAV
118 SBRC 85 Devonshire Street/258-262 792,629 0.61 Full Year 12 12/31/99 1,952,252
Washington Street
119 SBRC Centro De Distribucion del Norte 1,347,807 1.12 Full Year 12 12/31/99 2,150,554
120 GCM 801 Boylston Street UAV UAV UAV UAV UAV UAV
121 LBNA 29200 Northwestern Highway 644,330 0.69 Full Year 12 12/31/99 2,353,846
122 GCM Simchik Four Property Portfolio UAV UAV
122a 100 Market Street UAV Unannualized 8 12/31/99 225,129
122b 9 Executive Park Drive 121,630 Full Year 12 12/31/99 153,721
122c 1255 South Willow Street 63,740 Full Year 12 12/31/99 102,817
122d 135 Daniel Webster Highway 93,989 Full Year 12 12/31/99 142,902
123 GCM Four Points Hotel by Sheraton 1,789,715 1.83 Full Year 12 12/31/99 4,379,221
124 LBNA GE / Montgomery Wards UAV UAV UAV UAV UAV UAV
- Col. Springs
125 LBNA GE / Montgomery Wards UAV UAV UAV UAV UAV UAV
- Pasadena Tx
126 SBRC US Storage Centers 663,337 0.82 Trailing 12 12 01/31/00 1,491,911
127 LBNA Traders Tower - Self Park 1,413,951 1.63 Full Year 12 12/31/99 2,259,288
128 LBNA Mabek CO L.P. 1,785,240 1.32 Full Year 12 12/31/99 1,785,250
129 GCM Burlington Self Storage 818,246 1.10 Full Year 12 12/31/99 1,383,394
130 GCM Boynton Plaza 1,041,849 1.53 Full Year 12 12/31/99 1,423,016
131 SBRC 601-609 Mission Street UAV UAV Full Year 12 12/31/99 572,693
132 GCM Garden Ridge UAV UAV Annualized 11 12/31/99 925,825
133 GCM 300 West Pratt Street 827,155 1.32 Full Year 12 12/31/99 1,212,426
134 GCM The GTE Building UAV UAV Full Year 12 12/31/99 1,067,854
135 GCM Hamlin Court UAV UAV UAV UAV UAV UAV
136 AMCC Telex Building UAV UAV UAV UAV UAV UAV
137 AMCC Charnelton Place Office Building 558,710 0.91 Full Year 12 12/31/99 1,234,354
138 GCM Michael's Plaza 809,268 1.45 Full Year 12 12/31/99 994,352
139 GCM Mountain Vista Apartments 768,616 1.38
& Cibola Village
139a Mountain Vista Apartments 455,650 Full Year 12 12/31/99 1,220,511
139b Cibola Village 312,966 Full Year 12 12/31/99 645,356
140 LBNA Horizon Health Center 877,362 1.62 Full Year 12 12/31/99 1,368,169
141 GCM 300 West Hubbard Street Building 562,418 1.64 Full Year 12 12/31/99 903,001
142 GCM 445 North Wells Street Building 303,286 1.64 Full Year 12 12/31/99 696,797
143 GCM Miracle Mile Business Center 218,016 0.42 Full Year 12 12/31/99 661,905
144 GCM Folsom Self-Storage UAV UAV UAV UAV UAV UAV
</TABLE>
<TABLE>
<CAPTION>
MORTGAGED REAL PROPERTY 1998 AND 1999 HISTORICAL FINANCIAL INFORMATION
MORTGAGE
CONTROL LOAN 1999 1999
NUMBER SELLER LOAN / PROPERTY NAME EXPENSES 1999 NOI NOI DSCR
------ ------ -------------------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 12,937,989 17,621,668 1.69
102 LBNA Medical Mutual of Ohio UAV UAV UAV
103 LBNA Jorie Plaza 1,170,100 2,878,752 1.39
104 GCM Westland Meadows 1,183,972 2,426,850 1.23
105 GCM Stonegate One UAV UAV UAV
106 SBRC 149 New Montgomery Street UAV UAV UAV
107 LBNA 101 West Grand 828,596 1,280,217 1.55
108 LBNA 57 W. Grand 619,156 653,062 1.55
109 LBNA 40 West Hubbard 164,217 479,134 1.55
110 LBNA South Loop Market Place 917,136 1,792,789 1.20
111 GCM Granite State Marketplace 717,974 1,764,012 1.11
112 GCM Pacific Plaza 595,833 1,188,926 0.79
113 SBRC Seatac Village Shopping Center 468,699 1,920,889 1.40
114 LBNA Seattle-Mead Industrial Facilities 393,146 626,854 0.44
115 LBNA Hamilton Court Apartments 3,062,635 1,978,592 1.45
116 GCM Webster Building 660,058 1,588,253 1.09
117 SBRC Amerix Building UAV UAV UAV
118 SBRC 85 Devonshire Street/258-262 743,918 1,208,334 0.93
Washington Street
119 SBRC Centro De Distribucion del Norte 367,255 1,783,299 1.48
120 GCM 801 Boylston Street UAV UAV UAV
121 LBNA 29200 Northwestern Highway 948,611 1,405,235 1.51
122 GCM Simchik Four Property Portfolio UAV UAV
122a 100 Market Street 158,584 66,545
122b 9 Executive Park Drive 38,400 115,321
122c 1255 South Willow Street 18,294 84,523
122d 135 Daniel Webster Highway 48,484 94,418
123 GCM Four Points Hotel by Sheraton 2,536,665 1,842,556 1.88
124 LBNA GE / Montgomery Wards UAV UAV UAV
- Col. Springs
125 LBNA GE / Montgomery Wards UAV UAV UAV
- Pasadena Tx
126 SBRC US Storage Centers 425,880 1,066,031 1.32
127 LBNA Traders Tower - Self Park 1,016,410 1,242,878 1.44
128 LBNA Mabek CO L.P. 0 1,785,250 1.32
129 GCM Burlington Self Storage 462,399 920,995 1.24
130 GCM Boynton Plaza 423,098 999,918 1.47
131 SBRC 601-609 Mission Street 210,014 362,679 0.55
132 GCM Garden Ridge 0 925,825 1.42
133 GCM 300 West Pratt Street 396,020 816,406 1.31
134 GCM The GTE Building 67,736 1,000,118 1.62
135 GCM Hamlin Court UAV UAV UAV
136 AMCC Telex Building UAV UAV UAV
137 AMCC Charnelton Place Office Building 177,582 1,056,772 1.73
138 GCM Michael's Plaza 290,935 703,417 1.26
139 GCM Mountain Vista Apartments 779,161 1.39
& Cibola Village
139a Mountain Vista Apartments 717,085 503,426
139b Cibola Village 369,621 275,735
140 LBNA Horizon Health Center 488,432 879,737 1.62
141 GCM 300 West Hubbard Street Building 284,328 618,673 1.80
142 GCM 445 North Wells Street Building 365,629 331,168 1.80
143 GCM Miracle Mile Business Center 115,954 545,951 1.06
144 GCM Folsom Self-Storage UAV UAV UAV
</TABLE>
<PAGE> 213
MORTGAGED REAL PROPERTY 1998 AND 1999 HISTORICAL FINANCIAL INFORMATION
<TABLE>
<CAPTION>
1998 1998
MORTGAGE 1998 STATEMENT STATEMENT
CONTROL LOAN STATEMENT NUMBER OF ENDING 1998 1998
NUMBER SELLER LOAN / PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES
------ ------ -------------------- ---- ------ ---- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments Full Year 12 12/31/98 961,801 421,853
146 LBNA Carriage House Lofts Full Year 12 12/31/98 1,062,721 268,275
147 GCM Northpointe Shopping Center Full Year 12 12/31/98 560,494 196,033
148 GCM 2 Willow Street UAV UAV UAV UAV UAV
149 SBRC Villa de Mission East Full Year 12 12/31/98 1,091,936 454,024
150 GCM Calaveras Landing Shopping Center Full Year 12 12/31/98 746,552 159,574
151 GCM Healtheon Full Year 12 12/31/98 838,046 99,640
152 GCM 444 North Wells Street Building Full Year 12 12/31/98 1,228,747 521,749
153 GCM 1600 Corporate Center Drive UAV UAV UAV UAV UAV
156 SBRC Town Green at Wilton Center Full Year 12 12/31/98 823,854 266,402
154 GCM Little Creek Apartments Full Year 12 12/31/98 1,315,161 657,238
155 GCM 271 - 285 East Fordham Road UAV UAV UAV UAV UAV
157 GCM El Dorado Plaza Full Year 12 12/31/98 577,487 147,340
158 SBRC Tivoli Gardens Apartments Full Year 12 12/31/98 867,273 457,876
159 SBRC 155 Washington Ave Full Year 12 12/31/98 748,906 223,992
160 SBRC 370 Convention Way Full Year 12 12/31/98 452,003 68,649
161 GCM Union Landing Retail Center UAV UAV UAV UAV UAV
162 GCM Briarwood Apartments Full Year 12 12/31/98 616,861 239,608
163 SBRC Franklinton Square Shopping Center UAV UAV UAV UAV UAV
164 GCM Conquistador Apartments Full Year 12 12/31/98 819,080 210,900
165 GCM Greenhill Corporate Center UAV UAV UAV UAV UAV
166 GCM Northridge Apartments Full Year 12 12/31/98 837,404 361,039
167 GCM Red Coach Village Apartments UAV UAV UAV UAV UAV
168 AMCC K-Mart Shopping Center - Savannah UAV UAV UAV UAV UAV
169 SBRC The Cascades Full Year 12 12/31/98 489,792 375,347
170 GCM The Trane Company Building UAV UAV UAV UAV UAV
171 LBNA Chandler's Building UAV UAV UAV UAV UAV
172 AMCC K-Mart Shopping Center - Nashville UAV UAV UAV UAV UAV
173 AMCC 2150 Joshua's Path UAV UAV UAV UAV UAV
174 AMCC Ver-Sa-Til Full Year 12 12/31/98 927,333 464,133
175 LBNA Springdale Mall UAV UAV UAV UAV UAV
176 LBNA Frontier Commons/Global Crossing UAV UAV UAV UAV UAV
177 GCM Wythe Shopping Center Full Year 12 12/31/98 584,398 93,281
178 AMCC Pencader Corporate Center Full Year 12 12/31/98 587,175 82,912
179 LBNA Watermark Office Building UAV UAV UAV UAV UAV
180 GCM 801 West Diversey Parkway Full Year 12 12/31/98 407,729 146,674
181 GCM Lafayette Business Park Full Year 12 12/31/98 878,712 146,807
182 GCM Arrow Business Center Trailing 12 6/30/98 516,997 133,519
12
183 LBNA Palm Haven Mobile Home Park Full Year 12 12/31/98 560,614 190,263
184 AMCC Cedar Marketplace UAV UAV UAV UAV UAV
185 GCM Crossroads Professional Building Full Year 12 12/31/98 731,758 363,953
186 LBNA Imperial Crown Center Full Year 12 12/31/98 263,758 95,051
187 GCM Fran Murphy Building Full Year 12 12/31/98 653,229 215,321
188 GCM Walgreen's - South Medford UAV UAV UAV UAV UAV
189 GCM Sav-on and Carl's Jr. UAV UAV UAV UAV UAV
190 AMCC The Shops at Enon Springs UAV UAV UAV UAV UAV
191 AMCC Sierra Heartland Senior Apartments UAV UAV UAV UAV UAV
192 GCM Weatherbridge Center Buildings II
and III Full Year 12 12/31/98 125,767 16,210
</TABLE>
<TABLE>
<CAPTION>
1999 1999
MORTGAGE 1999 STATEMENT STATEMENT
CONTROL LOAN 1998 STATEMENT NUMBER OF ENDING 1999
NUMBER SELLER LOAN / PROPERTY NAME 1998 NOI NOI DSCR TYPE MONTHS DATE REVENUES
------ ------ -------------------- -------- -------- ---- ------ ---- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 539,948 1.14 UAV UAV UAV UAV
146 LBNA Carriage House Lofts 794,446 1.62 Full Year 12 12/31/99 1,162,054
147 GCM Northpointe Shopping Center 364,461 0.77 Full Year 12 12/31/99 609,385
148 GCM 2 Willow Street UAV UAV UAV UAV UAV UAV
149 SBRC Villa de Mission East 637,912 1.42 Full Year 12 12/31/99 1,095,397
150 GCM Calaveras Landing Shopping Center 586,978 1.28 Full Year 12 12/31/99 832,635
151 GCM Healtheon 738,406 1.62 Full Year 12 12/31/99 1,075,743
152 GCM 444 North Wells Street Building 706,998 1.49 Full Year 12 12/31/99 1,301,896
153 GCM 1600 Corporate Center Drive UAV UAV Annualized 1 12/31/99 789,192
156 SBRC Town Green at Wilton Center 557,452 1.24 Full Year 12 12/31/99 730,476
154 GCM Little Creek Apartments 657,923 1.50 Full Year 12 12/31/99 1,318,303
155 GCM 271 - 285 East Fordham Road UAV UAV UAV UAV UAV UAV
157 GCM El Dorado Plaza 430,147 1.09 Full Year 12 12/31/99 578,234
158 SBRC Tivoli Gardens Apartments 409,397 1.05 Full Year 12 12/31/99 1,081,794
159 SBRC 155 Washington Ave 524,914 1.26 Full Year 12 12/31/99 960,350
160 SBRC 370 Convention Way 383,354 0.91 Full Year 12 12/31/99 580,778
161 GCM Union Landing Retail Center UAV UAV Annualized 7 12/31/99 611,187
162 GCM Briarwood Apartments 377,253 1.05 Full Year 12 12/31/99 711,709
163 SBRC Franklinton Square Shopping Center UAV UAV Full Year 12 12/31/99 399,544
164 GCM Conquistador Apartments 608,180 1.63 Full Year 12 12/31/99 809,050
165 GCM Greenhill Corporate Center UAV UAV UAV UAV UAV UAV
166 GCM Northridge Apartments 476,365 1.32 Full Year 12 12/31/99 889,847
167 GCM Red Coach Village Apartments UAV UAV Annualized 10 12/31/99 787,346
168 AMCC K-Mart Shopping Center - Savannah UAV UAV Full Year 12 12/31/99 499,694
169 SBRC The Cascades 114,445 0.33 Full Year 12 12/31/99 833,029
170 GCM The Trane Company Building UAV UAV Full Year 12 12/31/99 535,340
171 LBNA Chandler's Building UAV UAV UAV UAV UAV UAV
172 AMCC K-Mart Shopping Center - Nashville UAV UAV Full Year 12 12/31/99 465,669
173 AMCC 2150 Joshua's Path UAV UAV UAV UAV UAV UAV
174 AMCC Ver-Sa-Til 463,200 1.42 Annualized 6 12/31/99 730,878
175 LBNA Springdale Mall UAV UAV Annualized 7 12/31/99 1,042,272
176 LBNA Frontier Commons/Global Crossing UAV UAV UAV UAV UAV UAV
177 GCM Wythe Shopping Center 491,117 1.48 Unannualized 6 12/31/99 309,792
178 AMCC Pencader Corporate Center 504,263 1.57 Full Year 12 12/31/99 646,428
179 LBNA Watermark Office Building UAV UAV Full Year 12 12/31/99 173,811
180 GCM 801 West Diversey Parkway 261,055 0.80 Full Year 12 12/31/99 227,406
181 GCM Lafayette Business Park 731,905 2.42 Full Year 12 12/31/99 1,024,872
182 GCM Arrow Business Center 383,478 1.30 Trailing 12 12 06/30/99 562,198
183 LBNA Palm Haven Mobile Home Park 370,351 1.24 Full Year 12 12/31/99 595,059
184 AMCC Cedar Marketplace UAV UAV UAV UAV UAV UAV
185 GCM Crossroads Professional Building 367,805 1.25 Full Year 12 12/31/99 711,593
186 LBNA Imperial Crown Center 168,707 0.60 Full Year 12 12/31/99 509,443
187 GCM Fran Murphy Building 437,908 1.51 Full Year 12 12/31/99 689,465
188 GCM Walgreen's - South Medford UAV UAV UAV UAV UAV UAV
189 GCM Sav-on and Carl's Jr. UAV UAV UAV UAV UAV UAV
190 AMCC The Shops at Enon Springs UAV UAV UAV UAV UAV UAV
191 AMCC Sierra Heartland Senior Apartments UAV UAV UAV UAV UAV UAV
192 GCM Weatherbridge Center Buildings II
and III 109,557 0.32 Full Year 12 12/31/99 301,133
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN 1999 1999
NUMBER SELLER LOAN / PROPERTY NAME EXPENSES 1999 NOI NOI DSCR
------ ------ -------------------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments UAV UAV UAV
146 LBNA Carriage House Lofts 501,242 660,812 1.35
147 GCM Northpointe Shopping Center 190,024 419,361 0.89
148 GCM 2 Willow Street UAV UAV UAV
149 SBRC Villa de Mission East 493,655 601,742 1.34
150 GCM Calaveras Landing Shopping Center 225,121 607,514 1.33
151 GCM Healtheon 228,902 846,841 1.86
152 GCM 444 North Wells Street Building 502,347 799,549 1.69
153 GCM 1600 Corporate Center Drive 465,324 323,868 0.70
156 SBRC Town Green at Wilton Center 216,779 513,697 1.15
154 GCM Little Creek Apartments 648,860 669,443 1.53
155 GCM 271 - 285 East Fordham Road UAV UAV UAV
157 GCM El Dorado Plaza 123,750 454,484 1.15
158 SBRC Tivoli Gardens Apartments 574,927 506,868 1.30
159 SBRC 155 Washington Ave 238,501 721,849 1.73
160 SBRC 370 Convention Way 186,736 394,042 0.94
161 GCM Union Landing Retail Center 94,791 516,396 1.41
162 GCM Briarwood Apartments 234,234 477,475 1.33
163 SBRC Franklinton Square Shopping Center 65,088 334,456 0.91
164 GCM Conquistador Apartments 202,764 606,286 1.62
165 GCM Greenhill Corporate Center UAV UAV UAV
166 GCM Northridge Apartments 408,404 481,443 1.34
167 GCM Red Coach Village Apartments 320,174 467,172 1.30
168 AMCC K-Mart Shopping Center - Savannah 24,985 474,709 1.31
169 SBRC The Cascades 386,399 446,630 1.27
170 GCM The Trane Company Building 63,249 472,091 1.32
171 LBNA Chandler's Building UAV UAV UAV
172 AMCC K-Mart Shopping Center - Nashville 23,283 442,386 1.30
173 AMCC 2150 Joshua's Path UAV UAV UAV
174 AMCC Ver-Sa-Til 215,878 515,000 1.58
175 LBNA Springdale Mall 479,654 562,618 1.72
176 LBNA Frontier Commons/Global Crossing UAV UAV UAV
177 GCM Wythe Shopping Center 65,849 243,943 UAV
178 AMCC Pencader Corporate Center 158,528 487,900 1.52
179 LBNA Watermark Office Building 203,686 (29,875) (0.09)
180 GCM 801 West Diversey Parkway 141,752 85,654 0.26
181 GCM Lafayette Business Park 149,955 874,917 2.89
182 GCM Arrow Business Center 133,498 428,700 1.45
183 LBNA Palm Haven Mobile Home Park 195,804 399,255 1.34
184 AMCC Cedar Marketplace UAV UAV UAV
185 GCM Crossroads Professional Building 396,499 315,094 1.07
186 LBNA Imperial Crown Center 136,325 373,118 1.33
187 GCM Fran Murphy Building 187,941 501,524 1.74
188 GCM Walgreen's - South Medford UAV UAV UAV
189 GCM Sav-on and Carl's Jr. UAV UAV UAV
190 AMCC The Shops at Enon Springs UAV UAV UAV
191 AMCC Sierra Heartland Senior Apartments UAV UAV UAV
192 GCM Weatherbridge Center Buildings II
and III 24,061 277,072 0.81
</TABLE>
<PAGE> 214
MORTGAGED REAL PROPERTY 1998 AND 1999 HISTORICAL FINANCIAL INFORMATION
<TABLE>
<CAPTION>
1998 1998
MORTGAGE 1998 STATEMENT STATEMENT
CONTROL LOAN STATEMENT NUMBER OF ENDING 1998 1998
NUMBER SELLER LOAN / PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES
------ ------ -------------------- ---- ------ ---- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem UAV UAV UAV UAV UAV
194 GCM 1201 Sharp Street Full Year 12 12/31/98 554,415 129,182
195 AMCC RPS Warehouse UAV UAV UAV UAV UAV
196 AMCC 755 & 775 Fiero Lane UAV UAV UAV UAV UAV
197 GCM Redondo Tower Apartments Full Year 12 12/31/98 669,685 359,214
198 AMCC Plaza II Office Building UAV UAV UAV UAV UAV
199 LBNA Fountain Place Apartments Full Year 12 12/31/98 608,916 301,190
200 AMCC Carriage House Apartment Full Year 12 12/31/98 228,748 79,710
- Sioux Falls
201 AMCC Carriage House Apartment Full Year 12 12/31/98 188,519 78,841
- Brookings
202 AMCC Carriage House Apartment Full Year 12 12/31/98 180,853 96,552
- Pierre
203 GCM Pioneer Point Apartments Full Year 12 12/31/98 520,026 294,418
204 AMCC CVS Harper Center Full Year 12 12/31/98 387,193 45,655
205 SBRC K-Mart Shopping Center UAV UAV UAV UAV UAV
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive UAV UAV UAV UAV UAV
207 SBRC Broadway Plaza Building UAV UAV UAV UAV UAV
208 SBRC 225 Long Avenue Full Year 12 12/31/98 926,999 612,202
209 LBNA Almond Grand Gurnee Full Year 12 12/31/98 287,180 34,040
210 GCM Summit/Breckenridge Apartments Full Year 12 12/31/98 658,857 319,773
211 GCM Peppertree Apartments Full Year 12 12/31/98 754,646 581,138
212 GCM Hillmount Apartments Full Year 12 12/31/98 524,953 282,474
213 AMCC 1500 Renaissance Building UAV UAV UAV UAV UAV
214 AMCC Etinuum Office Building UAV UAV UAV UAV UAV
215 AMCC DHR Office Building Full Year 12 12/31/98 414,711 60,751
216 GCM Oakwood Manor Apartments Full Year 12 12/31/98 546,328 315,594
217 GCM Woodbend Apartments Full Year 12 12/31/98 408,629 155,010
218 AMCC Warminster Shopping Center Full Year 12 12/31/98 412,600 113,142
219 AMCC PBR II Full Year 12 12/31/98 250,644 64,442
220 AMCC PBR I Full Year 12 12/31/98 169,087 97,322
221 GCM U-Stor Chambers Self-Storage UAV UAV UAV UAV UAV
222 GCM 9925-9929 Jefferson Boulevard UAV UAV UAV UAV UAV
223 AMCC 810-812 Fiero Lane Full Year 12 12/31/98 259,932 31,352
224 AMCC Lab Corp of America Full Year 12 12/31/98 365,769 43,039
225 LBNA Birchbrook Office Park Full Year 12 12/31/98 271,590 91,552
226 GCM Oro Valley Self Storage Full Year 12 12/31/98 305,129 173,456
227 AMCC Hillcrest Retail/Office Shopping Full Year 12 12/31/98 352,530 108,898
Center
228 AMCC Cain Drive Warehouses Full Year 12 12/31/98 405,485 140,242
229 SBRC Mini-City Self Storage Full Year 12 12/31/98 373,611 207,744
230 AMCC Macy Building Full Year 12 12/31/98 286,188 47,625
231 GCM Senate Place Apartments Full Year 12 12/31/98 177,339 81,986
232 GCM Eastfield Townhouses Full Year 12 12/31/98 151,203 72,062
233 LBNA Kendall Manor Apartments Full Year 12 12/31/98 439,146 226,175
234 AMCC The Culver Building Full Year 12 12/31/98 243,649 105,330
235 AMCC Harvard Physicians Building Full Year 12 12/31/98 341,720 136,065
236 AMCC Lyon Street Retail Full Year 12 12/31/98 316,945 96,437
237 AMCC 350 Newton Avenue Apartments Annualized 6 06/30/98 279,898 127,245
238 AMCC Solar Gardens Full Year 12 12/31/98 368,184 163,444
239 AMCC Quality Suites Albuquerque Annualized 9 09/30/98 1,003,949 526,956
240 AMCC Springville Corners UAV UAV UAV UAV UAV
241 AMCC 224-234 East Broad Street Full Year 12 12/31/98 271,290 95,195
242 GCM 6380 McLeod Drive UAV UAV UAV UAV UAV
243 AMCC Black Mountain Point Office Full Year 12 12/31/98 318,278 145,547
Building
244 AMCC Waste Management Building UAV UAV UAV UAV UAV
245 AMCC Silver Lake Plaza UAV UAV UAV UAV UAV
246 AMCC Checkmate Apartments Full Year 12 12/31/98 333,403 154,864
247 AMCC Creekside Center UAV UAV UAV UAV UAV
248 AMCC Tolt Towne Center Full Year 12 12/31/98 302,855 112,420
249 AMCC South Fridley Apartments Full Year 12 12/31/98 373,591 174,602
250 GCM 6668 Owens Drive Full Year 12 12/31/98 330,489 0
251 GCM 6320 - 6330 McLeod Drive UAV UAV UAV UAV UAV
252 GCM Rite Aid - Hillside Full Year 12 12/31/98 223,762 41,351
253 AMCC Howard Johnson Lake Havasu Full Year 12 12/31/98 642,023 384,319
254 LBNA Wickiup Mobile Home & RV Park Full Year 12 12/31/98 173,888 50,363
255 AMCC 261 East 300 South Full Year 12 12/31/98 253,149 105,971
256 AMCC Hyde Park Apartments Full Year 12 12/31/98 367,402 205,085
257 AMCC Hawthorne Business Park Full Year 12 12/31/98 182,220 57,565
258 GCM Nogales Self Storage Full Year 12 12/31/98 269,662 125,313
</TABLE>
<TABLE>
<CAPTION>
1999 1999
MORTGAGE 1999 STATEMENT STATEMENT
CONTROL LOAN 1998 STATEMENT NUMBER OF ENDING 1999
NUMBER SELLER LOAN / PROPERTY NAME 1998 NOI NOI DSCR TYPE MONTHS DATE REVENUES
------ ------ -------------------- -------- -------- ---- ------ ---- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem UAV UAV UAV UAV UAV UAV
194 GCM 1201 Sharp Street 425,233 1.68 Full Year 12 12/31/99 572,384
195 AMCC RPS Warehouse UAV UAV UAV UAV UAV UAV
196 AMCC 755 & 775 Fiero Lane UAV UAV UAV UAV UAV UAV
197 GCM Redondo Tower Apartments 310,471 1.36 Full Year 12 12/31/99 713,861
198 AMCC Plaza II Office Building UAV UAV Full Year 12 12/31/99 380,258
199 LBNA Fountain Place Apartments 307,726 1.40 Full Year 12 12/31/99 628,244
200 AMCC Carriage House Apartment 149,038 1.35 Full Year 12 12/31/99 230,996
- Sioux Falls
201 AMCC Carriage House Apartment 109,678 1.35 Full Year 12 12/31/99 190,873
- Brookings
202 AMCC Carriage House Apartment 84,301 1.35 Full Year 12 12/31/99 171,608
- Pierre
203 GCM Pioneer Point Apartments 225,608 0.99 Unannualized 6 12/31/99 250,466
204 AMCC CVS Harper Center 341,538 1.56 UAV UAV UAV UAV
205 SBRC K-Mart Shopping Center UAV UAV UAV UAV UAV UAV
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive UAV UAV Full Year 12 12/31/99 185,836
207 SBRC Broadway Plaza Building UAV UAV UAV UAV UAV UAV
208 SBRC 225 Long Avenue 314,797 1.35 Full Year 12 12/31/99 929,069
209 LBNA Almond Grand Gurnee 253,140 1.13 Full Year 12 12/31/99 309,363
210 GCM Summit/Breckenridge Apartments 339,084 1.46 Full Year 12 12/31/99 664,787
211 GCM Peppertree Apartments 173,508 0.82 Full Year 12 12/31/99 897,763
212 GCM Hillmount Apartments 242,479 1.15 Full Year 12 12/31/99 523,657
213 AMCC 1500 Renaissance Building UAV UAV Annualized 11 12/31/99 257,635
214 AMCC Etinuum Office Building UAV UAV UAV UAV UAV UAV
215 AMCC DHR Office Building 353,960 1.65 Full Year 12 12/31/99 422,179
216 GCM Oakwood Manor Apartments 230,734 1.15 Full Year 12 12/31/99 557,074
217 GCM Woodbend Apartments 253,619 1.30 Full Year 12 12/31/99 407,919
218 AMCC Warminster Shopping Center 299,458 1.42 UAV UAV UAV UAV
219 AMCC PBR II 186,202 1.37 Full Year 12 12/31/99 253,052
220 AMCC PBR I 71,765 1.37 Full Year 12 12/31/99 217,856
221 GCM U-Stor Chambers Self-Storage UAV UAV Annualized 9 12/31/99 328,603
222 GCM 9925-9929 Jefferson Boulevard UAV UAV UAV UAV UAV UAV
223 AMCC 810-812 Fiero Lane 228,580 1.24 Full Year 12 12/31/99 346,368
224 AMCC Lab Corp of America 322,730 1.67 Full Year 12 12/31/99 364,839
225 LBNA Birchbrook Office Park 180,038 1.09 Full Year 12 12/31/99 309,747
226 GCM Oro Valley Self Storage 131,673 0.83 Full Year 12 12/31/99 386,265
227 AMCC Hillcrest Retail/Office Shopping 243,632 1.53 Full Year 12 12/31/99 363,305
Center
228 AMCC Cain Drive Warehouses 265,243 1.61 Full Year 12 12/31/99 408,640
229 SBRC Mini-City Self Storage 165,867 1.02 Full Year 12 12/31/99 421,509
230 AMCC Macy Building 238,563 1.58 Full Year 12 12/31/99 286,525
231 GCM Senate Place Apartments 95,353 1.23 Full Year 12 12/31/99 185,920
232 GCM Eastfield Townhouses 79,141 1.23 Full Year 12 12/31/99 153,612
233 LBNA Kendall Manor Apartments 212,971 1.53 UAV UAV UAV UAV
234 AMCC The Culver Building 138,319 1.03 Full Year 12 12/31/99 330,346
235 AMCC Harvard Physicians Building 205,655 1.46 Full Year 12 12/31/99 373,906
236 AMCC Lyon Street Retail 220,508 1.22 Full Year 12 12/31/99 334,409
237 AMCC 350 Newton Avenue Apartments 152,653 1.23 Full Year 12 12/31/99 328,796
238 AMCC Solar Gardens 204,740 1.52 Annualized 10 12/31/99 363,290
239 AMCC Quality Suites Albuquerque 476,993 3.22 Full Year 12 12/31/99 970,765
240 AMCC Springville Corners UAV UAV UAV UAV UAV UAV
241 AMCC 224-234 East Broad Street 176,095 1.24 Full Year 12 12/31/99 293,084
242 GCM 6380 McLeod Drive UAV UAV Full Year 12 12/31/99 104,592
243 AMCC Black Mountain Point Office 172,731 1.30 Full Year 12 12/31/99 357,884
Building
244 AMCC Waste Management Building UAV UAV UAV UAV UAV UAV
245 AMCC Silver Lake Plaza UAV UAV UAV UAV UAV UAV
246 AMCC Checkmate Apartments 178,539 1.45 Annualized 5 12/31/99 360,396
247 AMCC Creekside Center UAV UAV UAV UAV UAV UAV
248 AMCC Tolt Towne Center 190,435 1.67 Full Year 12 12/31/99 302,074
249 AMCC South Fridley Apartments 198,989 1.58 Full Year 12 12/31/99 405,799
250 GCM 6668 Owens Drive 330,489 2.96 Full Year 12 12/31/99 347,013
251 GCM 6320 - 6330 McLeod Drive UAV UAV Full Year 12 12/31/99 6,578
252 GCM Rite Aid - Hillside 182,411 1.36 Full Year 12 12/31/99 244,280
253 AMCC Howard Johnson Lake Havasu 257,704 2.17 Annualized 8 12/31/99 610,231
254 LBNA Wickiup Mobile Home & RV Park 123,525 1.21 Full Year 12 12/31/99 195,137
255 AMCC 261 East 300 South 147,178 1.44 Full Year 12 12/31/99 299,601
256 AMCC Hyde Park Apartments 162,317 1.44 Full Year 12 12/31/99 397,724
257 AMCC Hawthorne Business Park 124,655 1.24 Full Year 12 12/31/99 206,794
258 GCM Nogales Self Storage 144,349 1.45 Full Year 12 12/31/99 270,523
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN 1999 1999
NUMBER SELLER LOAN / PROPERTY NAME EXPENSES 1999 NOI NOI DSCR
------ ------ -------------------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem UAV UAV UAV
194 GCM 1201 Sharp Street 184,635 387,749 1.53
195 AMCC RPS Warehouse UAV UAV UAV
196 AMCC 755 & 775 Fiero Lane UAV UAV UAV
197 GCM Redondo Tower Apartments 372,131 341,730 1.50
198 AMCC Plaza II Office Building 59,795 320,463 1.33
199 LBNA Fountain Place Apartments 353,944 274,300 1.25
200 AMCC Carriage House Apartment 88,179 142,817 1.31
- Sioux Falls
201 AMCC Carriage House Apartment 84,221 106,652 1.31
- Brookings
202 AMCC Carriage House Apartment 88,691 82,917 1.31
- Pierre
203 GCM Pioneer Point Apartments 142,937 107,529 UAV
204 AMCC CVS Harper Center UAV UAV UAV
205 SBRC K-Mart Shopping Center UAV UAV UAV
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 98,930 86,906 0.39
207 SBRC Broadway Plaza Building UAV UAV UAV
208 SBRC 225 Long Avenue 516,098 412,971 1.78
209 LBNA Almond Grand Gurnee 36,537 272,826 1.22
210 GCM Summit/Breckenridge Apartments 340,077 324,710 1.40
211 GCM Peppertree Apartments 604,231 293,532 1.38
212 GCM Hillmount Apartments 274,999 248,658 1.18
213 AMCC 1500 Renaissance Building 30,643 226,992 1.05
214 AMCC Etinuum Office Building UAV UAV UAV
215 AMCC DHR Office Building 78,204 343,975 1.60
216 GCM Oakwood Manor Apartments 310,350 246,724 1.23
217 GCM Woodbend Apartments 157,639 250,280 1.29
218 AMCC Warminster Shopping Center UAV UAV UAV
219 AMCC PBR II 60,943 192,109 2.02
220 AMCC PBR I 29,531 188,325 2.02
221 GCM U-Stor Chambers Self-Storage 110,186 218,417 1.15
222 GCM 9925-9929 Jefferson Boulevard UAV UAV UAV
223 AMCC 810-812 Fiero Lane 59,638 286,730 1.56
224 AMCC Lab Corp of America 21,572 343,267 1.77
225 LBNA Birchbrook Office Park 96,774 212,973 1.28
226 GCM Oro Valley Self Storage 153,398 232,867 1.47
227 AMCC Hillcrest Retail/Office Shopping 113,309 249,996 1.57
Center
228 AMCC Cain Drive Warehouses 125,619 283,021 1.72
229 SBRC Mini-City Self Storage 198,309 223,200 1.38
230 AMCC Macy Building 47,986 238,539 1.58
231 GCM Senate Place Apartments 88,232 97,688 1.29
232 GCM Eastfield Townhouses 69,014 84,598 1.29
233 LBNA Kendall Manor Apartments UAV UAV UAV
234 AMCC The Culver Building 183,388 146,958 1.09
235 AMCC Harvard Physicians Building 151,291 222,615 1.58
236 AMCC Lyon Street Retail 93,113 241,296 1.34
237 AMCC 350 Newton Avenue Apartments 123,645 205,151 1.65
238 AMCC Solar Gardens 109,533 253,757 1.89
239 AMCC Quality Suites Albuquerque 475,174 495,591 3.34
240 AMCC Springville Corners UAV UAV UAV
241 AMCC 224-234 East Broad Street 73,174 219,910 1.55
242 GCM 6380 McLeod Drive 26,115 78,477 0.61
243 AMCC Black Mountain Point Office 152,190 205,694 1.54
Building
244 AMCC Waste Management Building UAV UAV UAV
245 AMCC Silver Lake Plaza UAV UAV UAV
246 AMCC Checkmate Apartments 123,030 237,366 1.92
247 AMCC Creekside Center UAV UAV UAV
248 AMCC Tolt Towne Center 113,315 188,759 1.65
249 AMCC South Fridley Apartments 160,074 245,725 1.95
250 GCM 6668 Owens Drive 0 347,013 3.11
251 GCM 6320 - 6330 McLeod Drive 7,005 (427) (0.00)
252 GCM Rite Aid - Hillside 49,838 194,442 1.45
253 AMCC Howard Johnson Lake Havasu 391,881 218,350 1.84
254 LBNA Wickiup Mobile Home & RV Park 49,253 145,884 1.43
255 AMCC 261 East 300 South 123,637 175,964 1.73
256 AMCC Hyde Park Apartments 206,154 191,570 1.71
257 AMCC Hawthorne Business Park 56,444 150,350 1.50
258 GCM Nogales Self Storage 111,257 159,266 1.60
</TABLE>
<PAGE> 215
MORTGAGED REAL PROPERTY 1998 AND 1999 HISTORICAL FINANCIAL INFORMATION
<TABLE>
<CAPTION>
1998 1998
MORTGAGE 1998 STATEMENT STATEMENT
CONTROL LOAN STATEMENT NUMBER OF ENDING 1998 1998
NUMBER SELLER LOAN / PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES
------ ------ -------------------- ---- ------ ---- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
259 GCM Glendale West Self Storage Full Year 12 12/31/98 283,111 143,071
260 AMCC Lovell Building Full Year 12 12/31/98 266,007 124,187
261 AMCC Nationwide Insurance Office Full Year 12 12/31/98 228,053 9,682
Building
262 AMCC Attache Building Annualized 7 12/31/98 147,120 46,211
263 GCM Airport Business Center Full Year 12 12/31/98 237,445 86,100
264 AMCC Bluebonnet Apartments Full Year 12 12/31/98 301,099 182,385
265 AMCC 8th Street Apartments Full Year 12 12/31/98 242,629 97,842
266 LBNA E. M. Jorgensen Building UAV UAV UAV UAV UAV
267 AMCC Ralph's Grocery & Deli Full Year 12 12/31/98 140,000 0
268 AMCC Market Square Full Year 12 12/31/98 126,378 5,571
269 AMCC Blockbuster Video-Salt Lake City Annualized 9.5 12/31/98 145,601 31,554
270 AMCC Prudential Wise-McIntire Office Full Year 12 12/31/98 162,978 43,799
Building
271 AMCC Licton Springs Court Apartments Annualized 6 12/31/98 140,176 24,688
272 AMCC Surgicenter of South Bay Full Year 12 12/31/98 302,680 36,187
273 AMCC West Fargo Living Center Full Year 12 12/31/98 193,817 76,916
274 AMCC Edgewood Apartments Full Year 12 12/31/98 184,476 92,664
275 AMCC Washington/Shepherd Retail Center Full Year 12 12/31/98 217,259 21,885
276 AMCC Candlewood Apartments Full Year 12 12/31/98 210,794 158,099
277 AMCC Bishop Lifting Products UAV UAV UAV UAV UAV
278 AMCC 188 State Street Full Year 12 12/31/98 97,380 29,576
279 AMCC Woodstone Properties Full Year 12 12/31/98 222,490 95,374
280 AMCC East Gate Manor Apartments Full Year 12 12/31/98 117,678 54,084
</TABLE>
<TABLE>
<CAPTION>
1999 1999
MORTGAGE 1999 STATEMENT STATEMENT
CONTROL LOAN 1998 STATEMENT NUMBER OF ENDING 1999
NUMBER SELLER LOAN / PROPERTY NAME 1998 NOI NOI DSCR TYPE MONTHS DATE REVENUES
------ ------ -------------------- -------- -------- ---- ------ ---- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
259 GCM Glendale West Self Storage 140,040 1.45 Full Year 12 12/31/99 299,170
260 AMCC Lovell Building 141,820 1.53 Full Year 12 12/31/99 272,204
261 AMCC Nationwide Insurance Office 218,371 2.04 Full Year 12 12/31/99 210,509
Building
262 AMCC Attache Building 100,909 1.08 Full Year 12 12/31/99 220,505
263 GCM Airport Business Center 151,345 1.54 Full Year 12 12/31/99 270,487
264 AMCC Bluebonnet Apartments 118,714 1.24 Full Year 12 12/31/99 336,836
265 AMCC 8th Street Apartments 144,787 1.62 Annualized 5 12/31/99 223,920
266 LBNA E. M. Jorgensen Building UAV UAV UAV UAV UAV UAV
267 AMCC Ralph's Grocery & Deli 140,000 1.73 Full Year 12 12/31/99 140,004
268 AMCC Market Square 120,807 1.55 Full Year 12 12/31/99 173,623
269 AMCC Blockbuster Video-Salt Lake City 114,047 1.51 Full Year 12 12/31/99 149,622
270 AMCC Prudential Wise-McIntire Office 119,179 1.73 Full Year 12 12/31/99 177,998
Building
271 AMCC Licton Springs Court Apartments 115,488 1.74 Full Year 12 12/31/99 141,248
272 AMCC Surgicenter of South Bay 266,493 3.85 Full Year 12 12/31/99 334,558
273 AMCC West Fargo Living Center 116,901 1.75 Full Year 12 12/31/99 195,784
274 AMCC Edgewood Apartments 91,812 1.37 Annualized 9.5 12/31/99 201,156
275 AMCC Washington/Shepherd Retail Center 195,374 2.55 Full Year 12 12/31/99 192,941
276 AMCC Candlewood Apartments 52,695 0.81 Full Year 12 12/31/99 239,537
277 AMCC Bishop Lifting Products UAV UAV Full Year 12 12/31/99 153,269
278 AMCC 188 State Street 67,804 1.32 Full Year 12 12/31/99 108,934
279 AMCC Woodstone Properties 127,116 2.06 Full Year 12 12/31/99 224,939
280 AMCC East Gate Manor Apartments 63,594 1.33 Full Year 12 12/31/99 128,685
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE
CONTROL LOAN 1999 1999
NUMBER SELLER LOAN / PROPERTY NAME EXPENSES 1999 NOI NOI DSCR
------ ------ -------------------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
259 GCM Glendale West Self Storage 134,246 164,924 1.70
260 AMCC Lovell Building 138,465 133,739 1.45
261 AMCC Nationwide Insurance Office 31,577 178,932 1.67
Building
262 AMCC Attache Building 58,250 162,255 1.74
263 GCM Airport Business Center 90,641 179,846 1.83
264 AMCC Bluebonnet Apartments 231,996 104,840 1.09
265 AMCC 8th Street Apartments 85,583 138,337 1.55
266 LBNA E. M. Jorgensen Building UAV UAV UAV
267 AMCC Ralph's Grocery & Deli 0 140,004 1.73
268 AMCC Market Square 22,497 151,126 1.94
269 AMCC Blockbuster Video-Salt Lake City 30,250 119,372 1.58
270 AMCC Prudential Wise-McIntire Office 50,256 127,742 1.85
Building
271 AMCC Licton Springs Court Apartments 19,354 121,894 1.84
272 AMCC Surgicenter of South Bay 12,294 322,264 4.66
273 AMCC West Fargo Living Center 76,112 119,672 1.79
274 AMCC Edgewood Apartments 79,232 121,924 1.81
275 AMCC Washington/Shepherd Retail Center 29,154 163,787 2.14
276 AMCC Candlewood Apartments 118,401 121,136 1.86
277 AMCC Bishop Lifting Products 16,769 136,500 1.43
278 AMCC 188 State Street 27,015 81,919 1.59
279 AMCC Woodstone Properties 79,844 145,095 2.35
280 AMCC East Gate Manor Apartments 54,184 74,501 1.56
</TABLE>
<PAGE> 216
MORTGAGED REAL PROPERTY 2000 AND UNDERWRITTEN FINANCIAL INFORMATION
<TABLE>
<CAPTION>
2000
STATE-
MENT
MORTGAGE 2000 NUMBER 2000 STATE-
CONTROL LOAN STATEMENT OF MENT ENDING 2000 2000
NUMBER SELLER LOAN/PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES 2000 NOI
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place UAV UAV UAV UAV UAV UAV
102 LBNA Medical Mutual of Ohio UAV UAV UAV UAV UAV UAV
103 LBNA Jorie Plaza Trailing 12 12 09/30/00 3,999,815 1,101,394 2,898,421
104 GCM Westland Meadows Trailing 12 12 06/30/00 3,649,563 1,165,096 2,484,467
105 GCM Stonegate One UAV UAV UAV UAV UAV UAV
106 SBRC 149 New Montgomery Street Annualized 6 06/30/00 2,775,288 75,159 2,700,129
107 LBNA 101 West Grand Trailing 12 12 09/30/00 2,425,241 952,826 1,472,415
108 LBNA 57 W. Grand Trailing 12 12 09/30/00 1,326,664 556,759 769,905
109 LBNA 40 West Hubbard Trailing 12 12 09/30/00 690,793 194,351 496,442
110 LBNA South Loop Market Place Trailing 12 12 08/31/00 2,876,784 568,829 2,307,955
111 GCM Granite State Marketplace Annualized 6 06/30/00 2,569,779 642,049 1,927,730
112 GCM Pacific Plaza Trailing 12 12 06/30/00 2,290,288 732,959 1,557,329
113 SBRC Seatac Village Shopping Center Annualized 6 06/30/00 2,480,969 534,057 1,946,913
114 LBNA Seattle-Mead Industrial Facilities Trailing 12 12 07/31/00 1,498,012 450,525 1,047,487
115 LBNA Hamilton Court Apartments Trailing 12 12 09/30/00 5,061,783 3,063,892 1,997,891
116 GCM Webster Building Annualized 6 06/30/00 3,232,627 739,153 2,493,474
117 SBRC Amerix Building Annualized 6 06/30/00 2,197,476 7,628 2,189,848
118 SBRC 85 Devonshire Street/258-262
Washington Street Annualized 6 09/30/00 2,644,998 813,504 1,831,494
119 SBRC Centro De Distribucion del Norte Annualized 9 09/22/00 2,197,845 450,473 1,747,373
120 GCM 801 Boylston Street Annualized 7 07/31/00 1,357,675 278,870 1,078,805
121 LBNA 29200 Northwestern Highway Trailing 12 12 07/31/00 2,375,431 822,752 1,552,679
------------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 1,128,137
122a 100 Market Street Annualized 6 06/30/00 896,232 114,816 781,416
122b 9 Executive Park Drive Annualized 6 06/30/00 169,958 14,907 155,051
122c 1255 South Willow Street Annualized 6 06/30/00 80,475 0 80,475
122d 135 Daniel Webster Highway Annualized 6 06/30/00 144,638 33,443 111,195
------------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton Trailing 12 12 06/30/00 4,586,527 2,499,102 2,087,425
124 LBNA GE / Montgomery Wards UAV UAV UAV UAV UAV UAV
- Col. Springs
125 LBNA GE / Montgomery Wards UAV UAV UAV UAV UAV UAV
- Pasadena Tx
126 SBRC US Storage Centers Annualized 6 07/31/00 1,623,373 265,421 1,357,952
127 LBNA Traders Tower - Self Park Trailing 12 12 06/30/00 2,433,812 943,171 1,490,641
128 LBNA Mabek CO L.P. UAV UAV UAV UAV UAV UAV
129 GCM Burlington Self Storage Trailing 12 12 06/30/00 1,457,535 473,705 983,830
130 GCM Boynton Plaza Annualized 6 06/30/00 1,452,208 443,244 1,008,964
131 SBRC 601-609 Mission Street Trailing 12 12 06/30/00 876,824 229,128 647,696
132 GCM Garden Ridge Annualized 6 06/30/00 918,850 0 918,850
133 GCM 300 West Pratt Street Annualized 6 06/30/00 1,250,431 388,608 861,823
134 GCM The GTE Building Annualized 7 07/31/00 900,021 33,882 866,139
135 GCM Hamlin Court Annualized 7 07/31/00 1,428,650 139,435 1,289,215
136 AMCC Telex Building Annualized 4.7 09/30/00 1,810,935 624,805 1,186,130
137 AMCC Charnelton Place Office Building Annualized 8 08/31/00 1,274,613 206,625 1,067,988
138 GCM Michael's Plaza Annualized 6 06/30/00 610,561 305,440 305,121
------------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 806,812
& Cibola Village
139a Mountain Vista Apartments Trailing 12 12 06/30/00 1,242,743 717,452 525,291
139b Cibola Village Trailing 12 12 06/30/00 663,202 381,681 281,521
------------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center Trailing 12 12 03/31/00 1,363,600 497,044 866,556
141 GCM 300 West Hubbard Street Building Annualized 6 06/30/00 841,676 283,084 558,592
142 GCM 445 North Wells Street Building Annualized 6 06/30/00 651,512 364,752 286,760
143 GCM Miracle Mile Business Center Annualized 7 07/31/00 996,694 252,973 743,721
144 GCM Folsom Self-Storage Trailing 12 12 06/30/00 617,422 121,655 495,767
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE 2000 U/W U/W
CONTROL LOAN NOI U/W U/W NOI NCF
NUMBER SELLER LOAN/PROPERTY NAME DSCR REVENUES EXPENSES U/W NOI DSCR U/W NCF DSCR
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place UAV 34,361,662 14,710,046 19,651,616 1.88 17,029,161 1.63
102 LBNA Medical Mutual of Ohio UAV 6,194,215 1,670,826 4,523,389 1.40 4,019,905 1.24
103 LBNA Jorie Plaza 1.40 4,142,151 1,354,329 2,787,822 1.35 2,492,858 1.20
104 GCM Westland Meadows 1.26 3,498,399 1,096,500 2,401,899 1.22 2,363,299 1.20
105 GCM Stonegate One UAV 3,113,122 626,889 2,486,233 1.34 2,286,128 1.23
106 SBRC 149 New Montgomery Street 1.50 2,864,415 502,554 2,361,860 1.31 2,226,287 1.23
107 LBNA 101 West Grand 1.76 2,209,178 837,521 1,371,657 1.73 1,273,754 1.58
108 LBNA 57 W. Grand 1.76 1,451,898 602,056 849,842 1.73 737,456 1.58
109 LBNA 40 West Hubbard 1.76 639,737 163,277 476,460 1.73 460,588 1.58
110 LBNA South Loop Market Place 1.54 2,456,640 553,940 1,902,700 1.27 1,852,372 1.24
111 GCM Granite State Marketplace 1.21 2,732,747 665,942 2,066,805 1.30 1,963,623 1.23
112 GCM Pacific Plaza 1.03 2,762,357 771,689 1,990,668 1.32 1,874,604 1.25
113 SBRC Seatac Village Shopping Center 1.42 2,509,193 695,255 1,813,938 1.32 1,735,062 1.27
114 LBNA Seattle-Mead Industrial Facilities 0.74 2,273,125 449,375 1,823,750 1.28 1,715,236 1.20
115 LBNA Hamilton Court Apartments 1.47 5,098,585 3,066,324 2,032,261 1.49 1,887,511 1.39
116 GCM Webster Building 1.71 3,065,567 891,163 2,174,404 1.49 1,941,697 1.33
117 SBRC Amerix Building 1.54 2,087,601 41,752 2,045,849 1.44 1,847,962 1.30
118 SBRC 85 Devonshire Street/258-262
Washington Street 1.41 2,555,408 766,292 1,789,116 1.38 1,706,871 1.32
119 SBRC Centro De Distribucion del Norte 1.45 2,166,402 511,037 1,655,365 1.38 1,515,179 1.26
120 GCM 801 Boylston Street 1.01 1,611,512 366,754 1,244,758 1.17 1,201,867 1.13
121 LBNA 29200 Northwestern Highway 1.67 2,147,913 859,678 1,288,235 1.38 1,116,545 1.20
--------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 1.23 1,326,860 1.44 1,201,459 1.31
122a 100 Market Street 1,383,072 313,499 1,069,573 1,002,889
122b 9 Executive Park Drive 236,448 90,331 146,117 108,469
122c 1255 South Willow Street 115,755 55,385 60,370 49,133
122d 135 Daniel Webster Highway 114,368 63,569 50,799 40,968
--------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 2.13 4,110,542 2,437,637 1,672,905 1.71 1,467,378 1.50
124 LBNA GE / Montgomery Wards UAV 906,954 0 906,954 1.05 906,954 1.05
- Col. Springs
125 LBNA GE / Montgomery Wards UAV 482,515 0 482,515 1.05 482,515 1.05
- Pasadena Tx
126 SBRC US Storage Centers 1.68 1,481,915 333,546 1,148,369 1.42 1,139,076 1.41
127 LBNA Traders Tower - Self Park 1.72 2,273,613 931,418 1,342,195 1.55 1,302,226 1.50
128 LBNA Mabek CO L.P. UAV 1,660,283 49,808 1,610,475 1.19 1,502,836 1.11
129 GCM Burlington Self Storage 1.33 1,602,814 529,773 1,073,041 1.45 1,061,241 1.43
130 GCM Boynton Plaza 1.48 1,469,619 466,441 1,003,178 1.48 954,693 1.40
131 SBRC 601-609 Mission Street 0.97 1,133,244 220,033 913,211 1.37 875,574 1.32
132 GCM Garden Ridge 1.41 872,908 29,708 843,200 1.30 830,960 1.28
133 GCM 300 West Pratt Street 1.38 1,305,547 425,018 880,529 1.41 793,678 1.27
134 GCM The GTE Building 1.40 913,408 37,902 875,506 1.41 772,982 1.25
135 GCM Hamlin Court 2.02 1,067,927 142,005 925,922 1.45 830,262 1.30
136 AMCC Telex Building 1.85 2,070,013 1,166,629 903,384 1.41 833,291 1.30
137 AMCC Charnelton Place Office Building 1.75 1,227,261 387,466 839,795 1.37 758,307 1.24
138 GCM Michael's Plaza 0.55 1,012,717 240,836 771,881 1.38 721,655 1.29
--------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 1.44 782,393 1.40 695,393 1.24
& Cibola Village
139a Mountain Vista Apartments 1,217,042 696,960 520,082 465,082
139b Cibola Village 638,194 375,883 262,311 230,311
--------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 1.60 1,295,374 481,775 813,599 1.50 692,036 1.27
141 GCM 300 West Hubbard Street Building 1.61 737,642 299,384 438,258 1.38 412,672 1.26
142 GCM 445 North Wells Street Building 1.61 661,672 375,877 285,795 1.38 250,078 1.26
143 GCM Miracle Mile Business Center 1.44 881,764 143,876 737,888 1.43 683,700 1.33
144 GCM Folsom Self-Storage 0.96 945,899 254,038 691,861 1.34 690,640 1.34
</TABLE>
<PAGE> 217
MORTGAGED REAL PROPERTY 2000 AND UNDERWRITTEN FINANCIAL INFORMATION
<TABLE>
<CAPTION>
2000
STATE-
MENT
MORTGAGE 2000 NUMBER 2000 STATE-
CONTROL LOAN STATEMENT OF MENT ENDING 2000 2000
NUMBER SELLER LOAN/PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES 2000 NOI
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments Annualized 11 06/30/00 1,214,794 555,969 658,825
146 LBNA Carriage House Lofts Trailing 12 12 08/31/00 1,200,970 286,882 914,088
147 GCM Northpointe Shopping Center Annualized 7 07/31/00 538,354 246,147 292,207
148 GCM 2 Willow Street Unannualized 7 07/31/00 398,263 117,765 280,498
149 SBRC Villa de Mission East UAV UAV UAV UAV UAV UAV
150 GCM Calaveras Landing Shopping Center Annualized 7 07/31/00 610,364 191,524 418,840
151 GCM Healtheon Annualized 8 08/31/00 1,085,804 225,028 860,776
152 GCM 444 North Wells Street Building Annualized 6 06/30/00 1,320,694 536,216 784,478
153 GCM 1600 Corporate Center Drive Annualized 6 06/30/00 749,461 9,686 739,775
156 SBRC Town Green at Wilton Center Annualized 6 06/30/00 804,156 130,991 673,165
154 GCM Little Creek Apartments UAV UAV UAV UAV UAV UAV
155 GCM 271 - 285 East Fordham Road Unannualized 6 06/30/00 235,290 2,241 233,049
157 GCM El Dorado Plaza Annualized 7 07/31/00 592,865 135,021 457,844
158 SBRC Tivoli Gardens Apartments Trailing 12 12 06/30/00 1,085,889 599,360 486,529
159 SBRC 155 Washington Ave Annualized 6 06/30/00 935,605 202,618 732,987
160 SBRC 370 Convention Way Annualized 6 06/30/00 615,442 84,449 530,993
161 GCM Union Landing Retail Center Unannualized 2.13 06/30/00 140,888 32,089 108,799
162 GCM Briarwood Apartments Annualized 6 06/30/00 777,486 271,047 506,439
163 SBRC Franklinton Square Shopping Center Annualized 11 09/30/00 530,555 144,709 385,846
164 GCM Conquistador Apartments Annualized 6 06/30/00 813,360 232,695 580,665
165 GCM Greenhill Corporate Center Annualized 6 06/30/00 439,579 63,336 376,243
166 GCM Northridge Apartments Trailing 12 12 06/30/00 889,476 401,136 488,340
167 GCM Red Coach Village Apartments Annualized 6 06/30/00 806,728 298,546 508,182
168 AMCC K-Mart Shopping Center - Savannah Annualized 6 06/30/00 499,694 0 499,694
169 SBRC The Cascades Annualized 6 06/30/00 919,560 465,704 453,856
170 GCM The Trane Company Building Unannualized 5 06/30/00 289,703 67,881 221,822
171 LBNA Chandler's Building UAV UAV UAV UAV UAV UAV
172 AMCC K-Mart Shopping Center
- Nashville Annualized 6 06/30/00 465,669 0 465,669
173 AMCC 2150 Joshua's Path Annualized 6 06/30/00 865,668 291,232 574,436
174 AMCC Ver-Sa-Til Annualized 6 06/30/00 677,538 214,877 462,661
175 LBNA Springdale Mall Trailing 12 12 06/30/00 998,853 478,414 520,439
176 LBNA Frontier Commons/Global Crossing UAV UAV UAV UAV UAV UAV
177 GCM Wythe Shopping Center Trailing 12 12 06/30/00 589,584 96,821 492,763
178 AMCC Pencader Corporate Center Annualized 8 08/31/00 638,158 51,726 586,432
179 LBNA Watermark Office Building Trailing 12 12 07/31/00 714,767 228,897 485,870
180 GCM 801 West Diversey Parkway Annualized 12 06/30/00 629,919 158,806 471,113
181 GCM Lafayette Business Park Annualized 7 07/30/00 1,122,223 184,209 938,014
182 GCM Arrow Business Center Trailing 12 12 06/30/00 577,910 137,328 440,582
183 LBNA Palm Haven Mobile Home Park Annualized 7 09/30/00 597,275 160,866 436,409
184 AMCC Cedar Marketplace UAV UAV UAV UAV UAV UAV
185 GCM Crossroads Professional Building Annualized 6 06/30/00 782,432 338,920 443,512
186 LBNA Imperial Crown Center Trailing 12 12 07/31/00 634,893 127,801 507,092
187 GCM Fran Murphy Building Annualized 6 06/30/00 710,777 201,812 508,965
188 GCM Walgreen's - South Medford UAV UAV UAV UAV UAV UAV
189 GCM Sav-on and Carl's Jr. Annualized 8 07/31/00 433,104 0 433,104
190 AMCC The Shops at Enon Springs Annualized 6 06/30/00 274,466 28,380 246,086
191 AMCC Sierra Heartland
Senior Apartments Annualized 7 08/31/00 306,073 138,025 168,048
192 GCM Weatherbridge Center Buildings II
and III Annualized 7 07/31/00 455,415 53,080 402,335
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE 2000 U/W U/W
CONTROL LOAN NOI U/W U/W NOI NCF
NUMBER SELLER LOAN/PROPERTY NAME DSCR REVENUES EXPENSES U/W NOI DSCR U/W NCF DSCR
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 1.39 1,224,177 556,928 667,249 1.41 620,257 1.31
146 LBNA Carriage House Lofts 1.86 1,138,624 453,906 684,718 1.40 664,468 1.36
147 GCM Northpointe Shopping Center 0.62 840,653 169,046 671,607 1.42 598,631 1.27
148 GCM 2 Willow Street UAV 917,151 271,823 645,328 1.36 591,349 1.25
149 SBRC Villa de Mission East UAV 1,074,555 479,057 595,498 1.33 547,498 1.22
150 GCM Calaveras Landing Shopping Center 0.92 908,312 211,225 697,087 1.53 656,483 1.44
151 GCM Healtheon 1.89 1,025,065 229,175 795,890 1.74 738,562 1.62
152 GCM 444 North Wells Street Building 1.66 1,235,561 546,848 688,713 1.45 617,495 1.30
153 GCM 1600 Corporate Center Drive 1.59 692,673 57,846 634,827 1.36 577,483 1.24
156 SBRC Town Green at Wilton Center 1.50 888,299 285,570 602,729 1.35 561,525 1.25
154 GCM Little Creek Apartments UAV 1,373,554 745,311 628,243 1.44 576,763 1.32
155 GCM 271 - 285 East Fordham Road UAV 708,882 111,297 597,585 1.32 586,031 1.29
157 GCM El Dorado Plaza 1.16 705,119 169,313 535,806 1.36 496,518 1.26
158 SBRC Tivoli Gardens Apartments 1.25 1,106,561 579,881 526,680 1.35 474,741 1.22
159 SBRC 155 Washington Ave 1.76 896,194 285,816 610,378 1.47 526,056 1.26
160 SBRC 370 Convention Way 1.26 730,525 160,890 569,636 1.36 525,536 1.25
161 GCM Union Landing Retail Center UAV 845,120 230,021 615,099 1.68 591,079 1.61
162 GCM Briarwood Apartments 1.41 792,029 259,567 532,462 1.48 512,920 1.43
163 SBRC Franklinton Square Shopping Center 1.05 603,158 124,805 478,352 1.30 450,295 1.22
164 GCM Conquistador Apartments 1.55 774,027 248,940 525,087 1.41 491,086 1.31
165 GCM Greenhill Corporate Center 1.01 698,632 168,690 529,942 1.43 464,431 1.25
166 GCM Northridge Apartments 1.36 917,707 431,375 486,332 1.35 432,332 1.20
167 GCM Red Coach Village Apartments 1.41 814,514 330,002 484,512 1.34 450,512 1.25
168 AMCC K-Mart Shopping Center - Savannah 1.38 494,566 14,837 479,729 1.33 474,763 1.31
169 SBRC The Cascades 1.29 1,035,567 484,769 550,798 1.57 421,073 1.20
170 GCM The Trane Company Building UAV 607,933 118,491 489,442 1.36 444,575 1.24
171 LBNA Chandler's Building UAV 655,262 179,184 476,078 1.30 443,734 1.22
172 AMCC K-Mart Shopping Center
- Nashville 1.37 456,356 13,691 442,665 1.30 442,665 1.30
173 AMCC 2150 Joshua's Path 1.71 886,289 340,036 546,253 1.62 453,172 1.35
174 AMCC Ver-Sa-Til 1.42 954,927 503,384 451,543 1.38 407,457 1.25
175 LBNA Springdale Mall 1.59 955,355 430,569 524,786 1.61 452,640 1.39
176 LBNA Frontier Commons/Global Crossing UAV 655,245 104,642 550,603 1.65 488,765 1.46
177 GCM Wythe Shopping Center 1.49 579,677 96,942 482,735 1.46 423,867 1.28
178 AMCC Pencader Corporate Center 1.83 576,540 102,353 474,187 1.48 400,818 1.25
179 LBNA Watermark Office Building 1.54 761,858 287,175 474,683 1.50 398,857 1.26
180 GCM 801 West Diversey Parkway 1.44 595,963 165,427 430,536 1.31 410,395 1.25
181 GCM Lafayette Business Park 3.10 962,521 150,331 812,190 2.68 747,124 2.47
182 GCM Arrow Business Center 1.49 565,454 133,231 432,223 1.46 384,420 1.30
183 LBNA Palm Haven Mobile Home Park 1.46 606,072 234,838 371,234 1.25 357,734 1.20
184 AMCC Cedar Marketplace UAV 541,089 162,584 378,505 1.34 360,850 1.28
185 GCM Crossroads Professional Building 1.51 824,639 375,419 449,220 1.53 378,651 1.29
186 LBNA Imperial Crown Center 1.81 605,559 150,900 454,659 1.62 360,610 1.29
187 GCM Fran Murphy Building 1.76 666,325 218,367 447,958 1.55 401,546 1.39
188 GCM Walgreen's - South Medford UAV 371,510 11,145 360,365 1.27 358,974 1.26
189 GCM Sav-on and Carl's Jr. 1.64 436,642 19,327 417,315 1.58 404,630 1.53
190 AMCC The Shops at Enon Springs 0.96 437,891 81,349 356,542 1.39 331,046 1.29
191 AMCC Sierra Heartland
Senior Apartments 0.67 444,144 127,759 316,385 1.26 304,385 1.21
192 GCM Weatherbridge Center Buildings II
and III 1.17 610,518 109,472 501,046 1.46 450,062 1.31
</TABLE>
<PAGE> 218
MORTGAGED REAL PROPERTY 2000 AND UNDERWRITTEN FINANCIAL INFORMATION
<TABLE>
<CAPTION>
2000
STATE-
MENT
MORTGAGE 2000 NUMBER 2000 STATE-
CONTROL LOAN STATEMENT OF MENT ENDING 2000 2000
NUMBER SELLER LOAN/PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES 2000 NOI
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem UAV UAV UAV UAV UAV UAV
194 GCM 1201 Sharp Street Annualized 6 06/30/00 523,707 144,169 379,538
195 AMCC RPS Warehouse UAV UAV UAV UAV UAV UAV
196 AMCC 755 & 775 Fiero Lane Annualized 7 07/31/00 422,828 33,724 389,104
197 GCM Redondo Tower Apartments Annualized 6 06/30/00 766,290 364,803 401,487
198 AMCC Plaza II Office Building Annualized 6.6 07/18/00 434,110 79,630 354,480
199 LBNA Fountain Place Apartments Trailing 12 9 09/30/00 654,842 360,387 294,455
200 AMCC Carriage House Apartment Annualized 6 06/30/00 235,122 85,044 150,078
- Sioux Falls
201 AMCC Carriage House Apartment Annualized 6 06/30/00 194,556 71,414 123,142
- Brookings
202 AMCC Carriage House Apartment Annualized 6 06/30/00 175,086 77,430 97,656
- Pierre
203 GCM Pioneer Point Apartments Unannualized 7 07/31/00 363,588 211,104 152,484
204 AMCC CVS Harper Center Annualized 7 07/31/00 437,631 53,837 383,794
205 SBRC K-Mart Shopping Center UAV UAV UAV UAV UAV UAV
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive Unannualized 7 07/31/00 201,641 44,018 157,623
207 SBRC Broadway Plaza Building UAV UAV UAV UAV UAV UAV
208 SBRC 225 Long Avenue Annualized 6 06/30/00 949,748 446,708 503,040
209 LBNA Almond Grand Gurnee Trailing 12 12 06/30/00 310,195 34,509 275,686
210 GCM Summit/Breckenridge Apartments Trailing 12 12 06/30/00 672,986 355,559 317,427
211 GCM Peppertree Apartments Annualized 6 06/30/00 901,304 558,853 342,451
212 GCM Hillmount Apartments Trailing 12 12 06/30/00 545,063 291,176 253,887
213 AMCC 1500 Renaissance Building Annualized 9 09/30/00 353,019 32,427 320,592
214 AMCC Etinuum Office Building UAV UAV UAV UAV UAV UAV
215 AMCC DHR Office Building Annualized 9 09/30/00 425,472 70,279 355,193
216 GCM Oakwood Manor Apartments Trailing 12 12 06/30/00 563,093 323,424 239,669
217 GCM Woodbend Apartments Annualized 6 06/30/00 410,561 166,417 244,144
218 AMCC Warminster Shopping Center Annualized 9 09/30/00 413,747 114,536 299,211
219 AMCC PBR II Annualized 6 06/30/00 233,268 72,212 161,056
220 AMCC PBR I Annualized 6 06/30/00 218,392 30,976 187,416
221 GCM U-Stor Chambers Self-Storage Trailing 12 12 07/31/00 379,041 108,791 270,250
222 GCM 9925-9929 Jefferson Boulevard Annualized 6 06/30/00 303,195 47,096 256,099
223 AMCC 810-812 Fiero Lane Annualized 8 08/31/00 372,510 31,384 341,126
224 AMCC Lab Corp of America Annualized 9 09/30/00 308,200 14,119 294,081
225 LBNA Birchbrook Office Park Trailing 12 12 04/30/00 320,059 102,874 217,185
226 GCM Oro Valley Self Storage Trailing 12 12 06/30/00 408,968 181,293 227,675
227 AMCC Hillcrest Retail/Office Annualized 7 07/31/00 372,303 65,462 306,841
Shopping Center
228 AMCC Cain Drive Warehouses Annualized 6 06/30/00 383,420 17,442 365,978
229 SBRC Mini-City Self Storage Trailing 12 12 06/30/00 422,691 240,033 182,658
230 AMCC Macy Building UAV UAV UAV UAV UAV UAV
231 GCM Senate Place Apartments Annualized 6 06/30/00 189,900 83,664 106,236
232 GCM Eastfield Townhouses Trailing 12 12 06/30/00 151,421 73,405 78,016
233 LBNA Kendall Manor Apartments Trailing 12 12 09/30/00 445,098 246,425 198,673
234 AMCC The Culver Building Annualized 6 06/30/00 428,598 175,110 253,488
235 AMCC Harvard Physicians Building Annualized 9 09/30/00 379,103 161,500 217,603
236 AMCC Lyon Street Retail Annualized 8 08/31/00 352,434 93,461 258,973
237 AMCC 350 Newton Avenue Apartments Annualized 9 09/30/00 387,235 86,431 300,804
238 AMCC Solar Gardens Annualized 6 06/30/00 410,986 176,276 234,710
239 AMCC Quality Suites Albuquerque Annualized 6 06/30/00 1,050,720 492,558 558,162
240 AMCC Springville Corners UAV UAV UAV UAV UAV UAV
241 AMCC 224-234 East Broad Street Annualized 8 08/31/00 310,416 16,610 293,806
242 GCM 6380 McLeod Drive Annualized 6 06/30/00 206,033 37,665 168,368
243 AMCC Black Mountain Point Annualized 6 06/30/00 360,316 155,814 204,502
Office Building
244 AMCC Waste Management Building UAV UAV UAV UAV UAV UAV
245 AMCC Silver Lake Plaza Annualized 6 06/30/00 226,976 10,998 215,978
246 AMCC Checkmate Apartments Annualized 8 08/31/00 383,671 120,183 263,488
247 AMCC Creekside Center UAV UAV UAV UAV UAV UAV
248 AMCC Tolt Towne Center Annualized 6 06/30/00 314,310 113,064 201,246
249 AMCC South Fridley Apartments Annualized 8 08/31/00 458,800 245,626 213,174
250 GCM 6668 Owens Drive Annualized 6 06/30/00 403,822 40,210 363,612
251 GCM 6320 - 6330 McLeod Drive Unannualized 7 07/31/00 75,202 82,370 (7,169)
252 GCM Rite Aid - Hillside Annualized 6 06/30/00 251,301 44,364 206,937
253 AMCC Howard Johnson Lake Havasu Annualized 6 06/30/00 701,734 331,902 369,832
254 LBNA Wickiup Mobile Home & RV Park Trailing 12 12 06/30/00 192,815 50,163 142,652
255 AMCC 261 East 300 South Annualized 9 09/30/00 345,579 86,892 258,687
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE 2000 U/W U/W
CONTROL LOAN NOI U/W U/W NOI NCF
NUMBER SELLER LOAN/PROPERTY NAME DSCR REVENUES EXPENSES U/W NOI DSCR U/W NCF DSCR
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem UAV 336,574 14,097 322,477 1.08 322,477 1.08
194 GCM 1201 Sharp Street 1.50 531,019 149,579 381,440 1.51 322,309 1.27
195 AMCC RPS Warehouse UAV 413,913 85,086 328,827 1.36 304,355 1.26
196 AMCC 755 & 775 Fiero Lane 1.53 448,724 73,662 375,062 1.47 337,350 1.32
197 GCM Redondo Tower Apartments 1.76 753,403 381,626 371,777 1.63 347,485 1.52
198 AMCC Plaza II Office Building 1.47 510,045 157,468 352,577 1.46 302,896 1.26
199 LBNA Fountain Place Apartments 1.34 654,378 350,763 303,615 1.38 272,295 1.24
200 AMCC Carriage House Apartment 1.46 234,834 94,032 140,802 1.31 132,593 1.22
- Sioux Falls
201 AMCC Carriage House Apartment 1.46 195,577 87,693 107,884 1.31 99,834 1.22
- Brookings
202 AMCC Carriage House Apartment 1.46 174,986 90,905 84,081 1.31 76,581 1.22
- Pierre
203 GCM Pioneer Point Apartments UAV 630,080 318,504 311,576 1.37 286,076 1.26
204 AMCC CVS Harper Center 1.75 402,936 95,672 307,264 1.40 281,825 1.29
205 SBRC K-Mart Shopping Center UAV 304,608 7,046 297,562 1.15 297,562 1.15
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive UAV 419,359 84,899 334,460 1.49 297,636 1.33
207 SBRC Broadway Plaza Building UAV 464,662 135,901 328,761 1.49 283,928 1.29
208 SBRC 225 Long Avenue 2.16 982,701 592,486 390,215 1.68 313,778 1.35
209 LBNA Almond Grand Gurnee 1.23 309,363 39,864 269,499 1.21 268,108 1.20
210 GCM Summit/Breckenridge Apartments 1.37 667,078 351,550 315,528 1.36 288,778 1.25
211 GCM Peppertree Apartments 1.61 874,621 556,615 318,006 1.50 280,006 1.32
212 GCM Hillmount Apartments 1.20 572,058 289,410 282,648 1.34 257,398 1.22
213 AMCC 1500 Renaissance Building 1.49 384,001 75,478 308,523 1.43 269,973 1.25
214 AMCC Etinuum Office Building UAV 300,055 9,002 291,053 1.35 269,116 1.25
215 AMCC DHR Office Building 1.65 404,198 91,361 312,837 1.46 271,033 1.26
216 GCM Oakwood Manor Apartments 1.20 587,601 326,035 261,566 1.31 237,566 1.19
217 GCM Woodbend Apartments 1.26 470,503 204,659 265,844 1.37 240,844 1.24
218 AMCC Warminster Shopping Center 1.42 415,080 121,008 294,072 1.40 265,647 1.26
219 AMCC PBR II 1.85 244,013 62,743 181,270 2.01 156,561 1.76
220 AMCC PBR I 1.85 239,380 42,630 196,750 2.01 174,118 1.76
221 GCM U-Stor Chambers Self-Storage 1.42 374,230 129,946 244,284 1.28 239,094 1.25
222 GCM 9925-9929 Jefferson Boulevard 1.39 349,698 70,662 279,036 1.51 249,047 1.35
223 AMCC 810-812 Fiero Lane 1.86 336,800 51,563 285,237 1.55 245,150 1.33
224 AMCC Lab Corp of America 1.52 292,790 38,937 253,853 1.31 230,380 1.19
225 LBNA Birchbrook Office Park 1.31 338,354 97,117 241,237 1.45 208,097 1.25
226 GCM Oro Valley Self Storage 1.43 382,490 179,132 203,358 1.28 198,126 1.25
227 AMCC Hillcrest Retail/Office 1.92 330,239 116,157 214,082 1.34 198,072 1.24
Shopping Center
228 AMCC Cain Drive Warehouses 2.23 408,617 156,246 252,371 1.54 214,869 1.31
229 SBRC Mini-City Self Storage 1.13 424,230 198,564 225,666 1.39 216,520 1.33
230 AMCC Macy Building UAV 733,575 81,210 652,365 4.33 594,065 3.94
231 GCM Senate Place Apartments 1.30 196,359 83,656 112,703 1.37 104,703 1.26
232 GCM Eastfield Townhouses 1.30 154,207 72,788 81,419 1.37 73,090 1.26
233 LBNA Kendall Manor Apartments 1.43 464,971 243,436 221,535 1.59 193,185 1.39
234 AMCC The Culver Building 1.88 392,143 165,763 226,380 1.68 190,468 1.42
235 AMCC Harvard Physicians Building 1.54 381,353 165,516 215,837 1.53 172,344 1.22
236 AMCC Lyon Street Retail 1.43 314,889 108,204 206,685 1.14 189,664 1.05
237 AMCC 350 Newton Avenue Apartments 2.42 391,916 154,351 237,565 1.91 227,065 1.83
238 AMCC Solar Gardens 1.75 384,280 176,819 207,461 1.54 192,461 1.43
239 AMCC Quality Suites Albuquerque 3.76 952,295 582,579 369,716 2.49 322,106 2.17
240 AMCC Springville Corners UAV 213,621 31,659 181,962 1.37 165,940 1.25
241 AMCC 224-234 East Broad Street 2.07 278,194 73,043 205,151 1.44 189,726 1.33
242 GCM 6380 McLeod Drive 1.32 233,963 49,972 183,991 1.44 168,650 1.32
243 AMCC Black Mountain Point 1.54 419,161 160,182 258,979 1.95 195,310 1.47
Office Building
244 AMCC Waste Management Building UAV 223,547 29,476 194,071 1.33 181,223 1.24
245 AMCC Silver Lake Plaza 1.70 235,888 58,193 177,695 1.39 166,010 1.30
246 AMCC Checkmate Apartments 2.13 356,814 155,618 201,196 1.63 183,346 1.49
247 AMCC Creekside Center UAV 197,733 35,962 161,771 1.37 151,489 1.28
248 AMCC Tolt Towne Center 1.76 296,212 123,375 172,837 1.51 151,522 1.33
249 AMCC South Fridley Apartments 1.69 437,746 186,140 251,606 1.99 235,606 1.87
250 GCM 6668 Owens Drive 3.26 327,927 13,118 314,809 2.82 294,238 2.64
251 GCM 6320 - 6330 McLeod Drive UAV 208,466 43,262 165,204 1.41 151,241 1.29
252 GCM Rite Aid - Hillside 1.54 238,832 57,155 181,677 1.35 167,409 1.25
253 AMCC Howard Johnson Lake Havasu 3.12 588,760 383,253 205,507 1.73 174,628 1.47
254 LBNA Wickiup Mobile Home & RV Park 1.40 193,127 58,613 134,514 1.32 128,964 1.26
255 AMCC 261 East 300 South 2.54 300,711 123,845 176,866 1.73 133,248 1.31
</TABLE>
<PAGE> 219
MORTGAGED REAL PROPERTY 2000 AND UNDERWRITTEN FINANCIAL INFORMATION
<TABLE>
<CAPTION>
2000
STATE-
MENT
MORTGAGE 2000 NUMBER 2000 STATE-
CONTROL LOAN STATEMENT OF MENT ENDING 2000 2000
NUMBER SELLER LOAN/PROPERTY NAME TYPE MONTHS DATE REVENUES EXPENSES 2000 NOI
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments Annualized 8 08/31/00 437,545 262,789 174,756
257 AMCC Hawthorne Business Park Annualized 7 07/31/00 221,342 68,162 153,180
258 GCM Nogales Self Storage Trailing 12 12 06/30/00 286,701 124,889 161,812
259 GCM Glendale West Self Storage Trailing 12 12 06/30/00 310,221 128,328 181,893
260 AMCC Lovell Building Annualized 6 06/30/00 346,962 134,280 212,682
261 AMCC Nationwide Insurance
Office Building Annualized 6 06/30/00 204,662 7,412 197,250
262 AMCC Attache Building Annualized 10 10/31/00 244,535 35,463 209,072
263 GCM Airport Business Center Annualized 6 06/30/00 186,022 65,839 120,183
264 AMCC Bluebonnet Apartments Annualized 6 08/31/00 360,926 146,784 214,142
265 AMCC 8th Street Apartments Annualized 8 08/31/00 246,802 91,561 155,241
266 LBNA E. M. Jorgensen Building UAV UAV UAV UAV UAV UAV
267 AMCC Ralph's Grocery & Deli Annualized 9 09/30/00 140,004 0 140,004
268 AMCC Market Square Trailing 12 12 06/30/00 169,086 25,959 143,127
269 AMCC Blockbuster Video-Salt Lake City Annualized 8 08/31/00 137,318 11,371 125,947
270 AMCC Prudential Wise-McIntire
Office Building Annualized 9 09/30/00 183,922 51,472 132,450
271 AMCC Licton Springs Court Apartments Annualized 8 08/31/00 147,136 22,598 124,538
272 AMCC Surgicenter of South Bay Annualized 8 08/31/00 336,650 10,084 326,566
273 AMCC West Fargo Living Center Annualized 6 06/30/00 193,486 62,438 131,048
274 AMCC Edgewood Apartments Annualized 8 08/31/00 191,452 100,800 90,652
275 AMCC Washington/Shepherd Retail Center Annualized 9 09/30/00 214,843 14,887 199,956
276 AMCC Candlewood Apartments Annualized 9 09/30/00 271,149 173,283 97,866
277 AMCC Bishop Lifting Products UAV UAV UAV UAV UAV UAV
278 AMCC 188 State Street Annualized 9 09/30/00 122,744 32,874 89,870
279 AMCC Woodstone Properties Annualized 9 09/30/00 226,138 77,001 149,137
280 AMCC East Gate Manor Apartments Annualized 8 08/31/00 160,362 66,050 94,312
</TABLE>
<TABLE>
<CAPTION>
MORTGAGE 2000 U/W U/W
CONTROL LOAN NOI U/W U/W NOI NCF
NUMBER SELLER LOAN/PROPERTY NAME DSCR REVENUES EXPENSES U/W NOI DSCR U/W NCF DSCR
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 1.56 440,057 240,208 199,849 1.78 179,449 1.60
257 AMCC Hawthorne Business Park 1.52 228,377 65,237 163,140 1.62 128,867 1.28
258 GCM Nogales Self Storage 1.62 267,973 120,673 147,300 1.48 142,312 1.43
259 GCM Glendale West Self Storage 1.88 295,493 156,862 138,631 1.43 132,866 1.37
260 AMCC Lovell Building 2.30 311,384 158,564 152,820 1.65 118,644 1.28
261 AMCC Nationwide Insurance 1.84 190,336 21,664 168,672 1.57 148,463 1.39
Office Building
262 AMCC Attache Building 2.24 227,378 71,084 156,294 1.68 134,566 1.44
263 GCM Airport Business Center 1.22 288,102 124,426 163,676 1.66 140,871 1.43
264 AMCC Bluebonnet Apartments 2.23 342,583 196,203 146,380 1.53 122,380 1.28
265 AMCC 8th Street Apartments 1.74 229,662 108,842 120,820 1.35 108,220 1.21
266 LBNA E. M. Jorgensen Building UAV 117,990 3,540 114,450 1.35 101,860 1.20
267 AMCC Ralph's Grocery & Deli 1.73 130,200 3,906 126,294 1.56 114,794 1.42
268 AMCC Market Square 1.83 163,340 37,813 125,527 1.61 113,337 1.45
269 AMCC Blockbuster Video-Salt Lake City 1.67 141,417 36,860 104,557 1.39 97,603 1.29
270 AMCC Prudential Wise-McIntire 1.92 162,128 52,908 109,220 1.58 97,431 1.41
Office Building
271 AMCC Licton Springs Court Apartments 1.88 146,034 51,259 94,775 1.43 89,975 1.36
272 AMCC Surgicenter of South Bay 4.72 221,681 82,653 139,028 2.01 109,538 1.58
273 AMCC West Fargo Living Center 1.96 189,456 81,838 107,618 1.61 100,418 1.50
274 AMCC Edgewood Apartments 1.35 184,373 91,923 92,450 1.37 85,250 1.27
275 AMCC Washington/Shepherd Retail Center 2.61 187,875 42,229 145,646 1.90 128,649 1.68
276 AMCC Candlewood Apartments 1.50 252,402 141,465 110,937 1.70 98,937 1.52
277 AMCC Bishop Lifting Products UAV 148,552 29,754 118,798 1.24 105,445 1.10
278 AMCC 188 State Street 1.75 115,296 28,383 86,913 1.69 69,797 1.36
279 AMCC Woodstone Properties 2.42 237,831 100,885 136,946 2.22 123,970 2.01
280 AMCC East Gate Manor Apartments 1.97 152,315 67,942 84,373 1.76 77,473 1.62
</TABLE>
<PAGE> 220
MORTGAGE LOAN / MORTGAGED REAL PROPERTY ESCROW INFORMATION
<TABLE>
<CAPTION>
Recom- Escrowed
mended U/W Replace-
Annual Annual ment
Mortgage Taxes Insurance Replace- Replace- Reserves
Control Loan Currently Currently ment ment Initial
Number Seller Loan / Property Name Escrowed Escrowed Reserves Reserves Deposit
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place Yes Yes 241,658 244,638 244,638
102 LBNA Medical Mutual of Ohio Yes Yes 41,334 95,420 286,000 LOC
103 LBNA Jorie Plaza Yes Yes 17,754 38,333 0
104 GCM Westland Meadows Yes Yes 6,716 38,600 0
105 GCM Stonegate One Yes Yes 5,529 21,372 5,343
106 SBRC 149 New Montgomery Street Yes Yes 5,492 15,950 0
107 LBNA 101 West Grand Yes Yes 7,542 10,930 0
108 LBNA 57 W. Grand Yes Yes 9,542 12,520 0
109 LBNA 40 West Hubbard Yes Yes 2,000 1,901 0
110 LBNA South Loop Market Place Yes Yes 9,867 10,227 0
111 GCM Granite State Marketplace Yes Yes 43,712 43,712 0
112 GCM Pacific Plaza Yes Yes 20,290 19,584 1,632
113 SBRC Seatac Village Shopping Center Yes Yes 18,724 24,649 0
114 LBNA Seattle-Mead Industrial Facilities Yes Yes 17,042 17,042 0
115 LBNA Hamilton Court Apartments Yes Yes 92,515 144,750 0
116 GCM Webster Building Yes Yes 8,384 20,441 0
117 SBRC Amerix Building No No 22,588 30,879 0
118 SBRC 85 Devonshire Street/258-262 Washington Street Yes Yes 7,429 13,707 0
119 SBRC Centro De Distribucion del Norte Yes Yes 9,210 32,601 0
120 GCM 801 Boylston Street Yes Yes 1,024 4,025 1,006
121 LBNA 29200 Northwestern Highway Yes Yes 8,883 16,731 0
------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio Yes Yes 15,826 23,502 0
122a 100 Market Street 0 7,676
122b 9 Executive Park Drive 10,146 10,146
122c 1255 South Willow Street 3,280 3,280
122d 135 Daniel Webster Highway 2,400 2,400
------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton Yes Yes 101,658 205,527 0
124 LBNA GE / Montgomery Wards No No 24,000 0 0
- Col. Springs
125 LBNA GE / Montgomery Wards No No 45,733 0 0
- Pasadena Tx
126 SBRC US Storage Centers Yes Yes 2,781 9,293 0
127 LBNA Traders Tower - Self Park No No 1,833 39,969 0
128 LBNA Mabek CO L.P. No No 7,250 18,600 0
129 GCM Burlington Self Storage Yes Yes 7,437 11,800 984
130 GCM Boynton Plaza Yes Yes 17,998 13,993 0
131 SBRC 601-609 Mission Street Yes Yes 2,895 8,674 0
132 GCM Garden Ridge No Yes 8,847 12,240 0
133 GCM 300 West Pratt Street Yes Yes 11,375 12,075 0
134 GCM The GTE Building No No 8,521 21,584 0
135 GCM Hamlin Court Yes Yes 6,366 6,430 536
136 AMCC Telex Building Yes Yes 23,381 22,820 0
137 AMCC Charnelton Place Office Building Yes Yes 7,217 9,760 0
138 GCM Michael's Plaza Yes Yes 16,237 16,237 2,706
------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments Yes Yes 84,444 87,000 0
& Cibola Village
139a Mountain Vista Apartments 52,933 55,000
139b Cibola Village 31,511 32,000
------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center Yes Yes 9,042 9,042 0
141 GCM 300 West Hubbard Street Building Yes Yes 3,549 5,211 0
142 GCM 445 North Wells Street Building Yes Yes 4,160 6,169 0
143 GCM Miracle Mile Business Center Yes Yes 27,326 9,311 288,000
144 GCM Folsom Self-Storage Yes Yes 1,221 1,221 204
</TABLE>
<TABLE>
<CAPTION>
Escrowed
Escrowed Recom- Escrowed Replace-
Replace- mended U/W Replace- ment
ment Annual Annual ment Reserves
Reserves Replace- Replace- Reserves Current
Mortgage Current ment ment Initial Annual
Control Loan Annual Reserves Reserves Deposit Deposit
Number Seller Loan / Property Name Deposit PSF/Unit PSF/Unit PSF/Unit PSF/Unit
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 244,638 0.24 0.24 0.24 0.24
102 LBNA Medical Mutual of Ohio 0 0.11 0.25 0.75 LOC 0.00
103 LBNA Jorie Plaza 38,333 0.09 0.20 0.00 0.20
104 GCM Westland Meadows 38,600 8.68 49.87 0.00 49.87
105 GCM Stonegate One 21,372 0.04 0.15 0.04 0.15
106 SBRC 149 New Montgomery Street 15,950 0.07 0.20 0.00 0.20
107 LBNA 101 West Grand 10,932 0.10 0.15 0.00 0.15
108 LBNA 57 W. Grand 12,528 0.11 0.15 0.00 0.15
109 LBNA 40 West Hubbard 2,052 0.16 0.15 0.00 0.16
110 LBNA South Loop Market Place 15,360 0.10 0.10 0.00 0.15
111 GCM Granite State Marketplace 42,504 0.18 0.18 0.00 0.17
112 GCM Pacific Plaza 19,584 0.25 0.24 0.02 0.24
113 SBRC Seatac Village Shopping Center 24,649 0.11 0.15 0.00 0.15
114 LBNA Seattle-Mead Industrial Facilities 35,280 0.07 0.07 0.00 0.15
115 LBNA Hamilton Court Apartments 144,744 160 250 0.00 250
116 GCM Webster Building 20,441 0.06 0.15 0.00 0.15
117 SBRC Amerix Building 0 0.15 0.20 0.00 0.00
118 SBRC 85 Devonshire Street/258-262 Washington Street 13,698 0.08 0.15 0.00 0.15
119 SBRC Centro De Distribucion del Norte 32,604 0.03 0.10 0.00 0.10
120 GCM 801 Boylston Street 4,025 0.04 0.15 0.04 0.15
121 LBNA 29200 Northwestern Highway 18,900 0.08 0.15 0.00 0.17
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 23,496 0.00 0.25
122a 100 Market Street 0.00 0.15
122b 9 Executive Park Drive 0.37 0.37
122c 1255 South Willow Street 0.42 0.42
122d 135 Daniel Webster Highway 0.32 0.32
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton 4% of Revenue 800 1,618 0.00 4% of Revenue
124 LBNA GE / Montgomery Wards 0 0.15 0.00 0.00 0.00
- Col. Springs
125 LBNA GE / Montgomery Wards 0 0.24 0.00 0.00 0.00
- Pasadena Tx
126 SBRC US Storage Centers 9,355 0.03 0.10 0.00 0.10
127 LBNA Traders Tower - Self Park 0 0.01 0.16 0.00 0.00
128 LBNA Mabek CO L.P. 0 0.08 0.20 0.00 0.00
129 GCM Burlington Self Storage 11,808 0.08 0.13 0.01 0.13
130 GCM Boynton Plaza 0 0.18 0.14 0.00 0.00
131 SBRC 601-609 Mission Street 8,674 0.06 0.19 0.00 0.19
132 GCM Garden Ridge 0 0.07 0.10 0.00 0.00
133 GCM 300 West Pratt Street 12,072 0.19 0.20 0.00 0.20
134 GCM The GTE Building 0 0.08 0.20 0.00 0.00
135 GCM Hamlin Court 6,432 0.15 0.15 0.01 0.15
136 AMCC Telex Building 22,820 0.20 0.20 0.00 0.20
137 AMCC Charnelton Place Office Building 11,700 0.13 0.17 0.00 0.20
138 GCM Michael's Plaza 16,236 0.24 0.24 0.04 0.24
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments 87,000 0.00 250
& Cibola Village
139a Mountain Vista Apartments 241 250
139b Cibola Village 246 250
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 10,641 0.20 0.20 0.00 0.23
141 GCM 300 West Hubbard Street Building 0 0.14 0.20 0.00 0.00
142 GCM 445 North Wells Street Building 0 0.13 0.20 0.00 0.00
143 GCM Miracle Mile Business Center 9,312 0.23 0.08 2.47 0.08
144 GCM Folsom Self-Storage 1,221 0.01 0.01 0.00 0.01
</TABLE>
<TABLE>
<CAPTION>
Escrowed
Escrowed Escrowed TI/LC
Escrowed TI/LC TI/LC Reserves
U/W TI/LC Reserves U/W Reserves Current
Mortgage Annual Reserves Current Annual Initial Annual
Control Loan TI/LC Initial Annual TI/LC Deposit Deposit
Number Seller Loan / Property Name Reserves Deposit Deposit PSF/Unit PSF/Unit PSF/Unit
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
101 SBRC One Financial Place 2,377,817 2,005,362 2,005,362 2.33 1.97 1.97
102 LBNA Medical Mutual of Ohio 408,064 3,800,000 LOC 0 1.07 9.97 LOC 0.00
103 LBNA Jorie Plaza 256,631 0 256,631 1.34 0.00 1.34
104 GCM Westland Meadows NAP NAP NAP NAP NAP NAP
105 GCM Stonegate One 178,733 0 0 1.25 0.00 0.00
106 SBRC 149 New Montgomery Street 119,624 9,969 119,624 1.50 0.12 1.50
107 LBNA 101 West Grand 86,973 0 80,064 1.19 0.00 1.10
108 LBNA 57 W. Grand 99,866 0 91,812 1.20 0.00 1.10
109 LBNA 40 West Hubbard 13,971 0 14,100 1.10 0.00 1.11
110 LBNA South Loop Market Place 40,101 14,297 30,960 0.39 0.14 0.30
111 GCM Granite State Marketplace 59,470 25,000 80,208 0.24 0.10 0.32
112 GCM Pacific Plaza 96,480 8,040 96,480 1.18 0.10 1.18
113 SBRC Seatac Village Shopping Center 54,228 0 0 0.33 0.00 0.00
114 LBNA Seattle-Mead Industrial Facilities 91,472 0 84,660 0.39 0.00 0.36
115 LBNA Hamilton Court Apartments NAP NAP NAP NAP NAP NAP
116 GCM Webster Building 212,266 809,017 0 1.56 5.94 0.00
117 SBRC Amerix Building 167,008 0 0 1.08 0.00 0.00
118 SBRC 85 Devonshire Street/258-262
Washington Street 68,537 397,500 0 0.75 4.35 0.00
119 SBRC Centro De Distribucion del Norte 107,585 0 107,580 0.33 0.00 0.33
120 GCM 801 Boylston Street 38,866 3,239 38,866 1.45 0.12 1.45
121 LBNA 29200 Northwestern Highway 154,959 200,000 120,000 1.39 1.79 1.08
-----------------------------------------------------------------------------------------------------------------------------------
122 GCM Simchik Four Property Portfolio 101,898 0 102,000 0.00 1.09
122a 100 Market Street 59,008 0 0 1.16
122b 9 Executive Park Drive 27,502 0 0 1.01
122c 1255 South Willow Street 7,957 0 0 1.02
122d 135 Daniel Webster Highway 7,431 0 0 1.00
-----------------------------------------------------------------------------------------------------------------------------------
123 GCM Four Points Hotel by Sheraton NAP NAP NAP NAP NAP NAP
124 LBNA GE / Montgomery Wards 0 0 0 0.00 0.00 0.00
- Col. Springs
125 LBNA GE / Montgomery Wards 0 0 0 0.00 0.00 0.00
- Pasadena Tx
126 SBRC US Storage Centers NAP NAP NAP NAP NAP NAP
127 LBNA Traders Tower - Self Park NAP NAP NAP NAP NAP NAP
128 LBNA Mabek CO L.P. 89,039 0 0 0.96 0.00 0.00
129 GCM Burlington Self Storage NAP NAP NAP NAP NAP NAP
130 GCM Boynton Plaza 34,492 0 0 0.35 0.00 0.00
131 SBRC 601-609 Mission Street 28,963 0 32,532 0.65 0.00 0.73
132 GCM Garden Ridge 0 0 0 0.00 0.00 0.00
133 GCM 300 West Pratt Street 74,776 100,000 0 1.24 1.66 0.00
134 GCM The GTE Building 80,940 0 107,928 0.75 0.00 1.00
135 GCM Hamlin Court 89,230 357,433 89,196 2.08 8.34 2.08
136 AMCC Telex Building 47,273 900,000 0 0.41 7.89 0.00
137 AMCC Charnelton Place Office Building 71,728 170,000 67,800 1.25 2.96 1.18
138 GCM Michael's Plaza 33,989 5,664 33,984 0.50 0.08 0.50
-----------------------------------------------------------------------------------------------------------------------------------
139 GCM Mountain Vista Apartments NAP NAP NAP NAP NAP
& Cibola Village
139a Mountain Vista Apartments NAP NAP
139b Cibola Village NAP NAP
-----------------------------------------------------------------------------------------------------------------------------------
140 LBNA Horizon Health Center 112,521 1,000,000 110,000 2.43 21.61 2.38
141 GCM 300 West Hubbard Street Building 20,375 0 0 0.78 0.00 0.00
142 GCM 445 North Wells Street Building 29,548 0 0 0.95 0.00 0.00
143 GCM Miracle Mile Business Center 44,877 3,768 45,216 0.39 0.03 0.39
144 GCM Folsom Self-Storage NAP NAP NAP NAP NAP NAP
</TABLE>
<PAGE> 221
MORTGAGE LOAN / MORTGAGED REAL PROPERTY ESCROW INFORMATION
<TABLE>
<CAPTION>
Escrowed
Recom- Escrowed Replace-
mended U/W Replace- ment
Annual Annual ment Reserves
Mortgage Taxes Insurance Replace- Replace- Reserves Current
Control Loan Currently Currently ment ment Initial Annual
Number Seller Loan / Property Name Escrowed Escrowed Reserves Reserves Deposit Deposit
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments Yes Yes 57,551 46,992 0 44,000
146 LBNA Carriage House Lofts Yes Yes 8,042 20,250 0 20,250
147 GCM Northpointe Shopping Center Yes Yes 28,712 28,712 89,786 28,716
148 GCM 2 Willow Street Yes Yes 2,275 5,998 1,499 5,998
149 SBRC Villa de Mission East Yes Yes 48,069 48,000 0 48,000
150 GCM Calaveras Landing Shopping Center Yes Yes 4,780 9,745 812 9,744
151 GCM Healtheon Yes Yes 1,272 9,967 0 0
152 GCM 444 North Wells Street Building Yes Yes 6,160 11,690 11,375 LOC 0
153 GCM 1600 Corporate Center Drive Yes Yes 5,751 7,168 796 4,779
156 SBRC Town Green at Wilton Center Yes No 7,575 7,519 0 7,519
154 GCM Little Creek Apartments Yes Yes 51,569 51,480 0 51,480
155 GCM 271 - 285 East Fordham Road Yes Yes UAV 3,000 500 3,000
157 GCM El Dorado Plaza Yes Yes 9,972 9,972 9,000 9,972
158 SBRC Tivoli Gardens Apartments Yes Yes 46,649 51,939 114,375 52,200
159 SBRC 155 Washington Ave Yes Yes 9,020 14,054 0 14,054
160 SBRC 370 Convention Way Yes Yes 3,665 4,200 0 4,200
161 GCM Union Landing Retail Center Yes Yes 4,279 4,707 0 0
162 GCM Briarwood Apartments Yes Yes 19,542 19,542 3,257 19,542
163 SBRC Franklinton Square Shopping Center Yes Yes 2,667 9,805 0 6,536
164 GCM Conquistador Apartments Yes Yes 38,966 34,001 6,496 38,976
165 GCM Greenhill Corporate Center Yes Yes 4,035 5,284 440 5,280
166 GCM Northridge Apartments Yes Yes 43,985 54,000 0 54,000
167 GCM Red Coach Village Apartments Yes Yes 29,011 34,000 0 34,000
168 AMCC K-Mart Shopping Center - Savannah No No 14,966 4,966 100,000 LOC 0
169 SBRC The Cascades Yes Yes 15,350 17,390 0 17,424
170 GCM The Trane Company Building Yes Yes 1,712 5,016 0 5,016
171 LBNA Chandler's Building No No 1,542 3,689 0 3,690
172 AMCC K-Mart Shopping Center - Nashville No No 13,375 0 200,000 LOC 0
173 AMCC 2150 Joshua's Path Yes Yes 2,750 7,100 0 7,175
174 AMCC Ver-Sa-Til Yes No 2,858 10,780 0 10,779
175 LBNA Springdale Mall Yes Yes 4,138 14,946 0 57,200
176 LBNA Frontier Commons/Global Crossing Yes Yes 4,300 12,973 0 12,972
177 GCM Wythe Shopping Center Yes Yes 15,112 15,112 1,257 15,082
178 AMCC Pencader Corporate Center Yes Yes 14,185 15,925 0 12,000
179 LBNA Watermark Office Building Yes Yes 8,866 8,786 0 4,612
180 GCM 801 West Diversey Parkway Yes Yes 1,865 2,627 0 1,751
181 GCM Lafayette Business Park Yes Yes 27,004 27,004 0 0
182 GCM Arrow Business Center Yes Yes 15,797 14,415 559 6,708
183 LBNA Palm Haven Mobile Home Park Yes Yes 5,835 13,500 0 13,550
184 AMCC Cedar Marketplace Yes Yes 1,330 4,033 0 2,689
185 GCM Crossroads Professional Building Yes Yes 9,855 10,149 25,000 10,149
186 LBNA Imperial Crown Center Yes Yes 17,250 17,250 0 17,280
187 GCM Fran Murphy Building Yes Yes 7,570 7,570 8,549 7,570
188 GCM Walgreen's - South Medford No No 0 1,391 0 0
189 GCM Sav-on and Carl's Jr. No No UAV 2,448 408 2,448
190 AMCC The Shops at Enon Springs Yes Yes 3,526 4,800 0 4,800
191 AMCC Sierra Heartland Senior Apartments Yes Yes 4,767 12,000 0 12,000
192 GCM Weatherbridge Center Buildings II and III Yes Yes 10,787 7,640 635 7,620
</TABLE>
<TABLE>
<CAPTION>
Escrowed
Recom- Escrowed Replace-
mended U/W Replace- ment
Annual Annual ment Reserves
Replace- Replace- Reserves Current U/W
Mortgage ment ment Initial Annual Annual
Control Loan Reserves Reserves Deposit Deposit TI/LC
Number Seller Loan / Property Name PSF/Unit PSF/Unit PSF/Unit PSF/Unit Reserves
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments 327 267 0.00 250 NAP
146 LBNA Carriage House Lofts 99.28 250 0.00 250 NAP
147 GCM Northpointe Shopping Center 0.56 0.56 1.74 0.56 44,264
148 GCM 2 Willow Street 0.06 0.15 0.04 0.15 47,981
149 SBRC Villa de Mission East 300 300 0.00 300 NAP
150 GCM Calaveras Landing Shopping Center 0.07 0.15 0.01 0.15 30,859
151 GCM Healtheon 0.03 0.20 0.00 0.00 47,361
152 GCM 444 North Wells Street Building 0.11 0.20 0.19 LOC 0.00 59,528
153 GCM 1600 Corporate Center Drive 0.12 0.15 0.02 0.10 50,176
156 SBRC Town Green at Wilton Center 0.22 0.22 0.00 0.22 33,685
154 GCM Little Creek Apartments 259 259 0.00 259 NAP
155 GCM 271 - 285 East Fordham Road UAV 0.17 0.03 0.17 8,554
157 GCM El Dorado Plaza 0.16 0.16 0.14 0.16 29,316
158 SBRC Tivoli Gardens Apartments 233 260 572 261 NAP
159 SBRC 155 Washington Ave 0.13 0.21 0.00 0.21 70,268
160 SBRC 370 Convention Way 0.17 0.20 0.00 0.20 39,900
161 GCM Union Landing Retail Center 0.11 0.12 0.00 0.00 19,313
162 GCM Briarwood Apartments 305 305 50.89 305 NAP
163 SBRC Franklinton Square Shopping Center 0.04 0.15 0.00 0.10 18,252
164 GCM Conquistador Apartments 322 281 53.69 322 NAP
165 GCM Greenhill Corporate Center 0.11 0.15 0.01 0.15 60,227
166 GCM Northridge Apartments 204 250 0.00 250 NAP
167 GCM Red Coach Village Apartments 213 250 0.00 250 NAP
168 AMCC K-Mart Shopping Center - Savannah 0.13 0.04 0.90 LOC 0.00 0
169 SBRC The Cascades 0.18 0.20 0.00 0.20 112,335
170 GCM The Trane Company Building 0.03 0.10 0.00 0.10 39,851
171 LBNA Chandler's Building 0.06 0.14 0.00 0.14 28,655
172 AMCC K-Mart Shopping Center - Nashville 0.13 0.00 1.93 LOC 0.00 0
173 AMCC 2150 Joshua's Path 0.06 0.15 0.00 0.15 85,981
174 AMCC Ver-Sa-Til 0.03 0.10 0.00 0.10 33,306
175 LBNA Springdale Mall 0.04 0.14 0.00 0.55 57,200
176 LBNA Frontier Commons/Global Crossing 0.07 0.20 0.00 0.20 48,865
177 GCM Wythe Shopping Center 0.15 0.15 0.01 0.15 43,756
178 AMCC Pencader Corporate Center 0.18 0.20 0.00 0.15 57,444
179 LBNA Watermark Office Building 0.20 0.20 0.00 0.10 67,040
180 GCM 801 West Diversey Parkway 0.11 0.15 0.00 0.10 17,514
181 GCM Lafayette Business Park 0.38 0.38 0.00 0.00 38,062
182 GCM Arrow Business Center 0.16 0.15 0.01 0.07 33,388
183 LBNA Palm Haven Mobile Home Park 21.61 50.00 0.00 50.19 NAP
184 AMCC Cedar Marketplace 0.05 0.15 0.00 0.10 13,622
185 GCM Crossroads Professional Building 0.19 0.20 0.49 0.20 60,420
186 LBNA Imperial Crown Center 0.26 0.26 0.00 0.26 76,799
187 GCM Fran Murphy Building 0.17 0.17 0.19 0.17 38,842
188 GCM Walgreen's - South Medford 0.00 0.10 0.00 0.00 0
189 GCM Sav-on and Carl's Jr. UAV 0.12 0.02 0.12 10,237
190 AMCC The Shops at Enon Springs 0.11 0.15 0.00 0.15 20,696
191 AMCC Sierra Heartland Senior Apartments 79.44 200 0.00 200 NAP
192 GCM Weatherbridge Center Buildings II and III 0.21 0.15 0.01 0.15 43,344
</TABLE>
<TABLE>
<CAPTION>
Escrowed
Escrowed Escrowed TI/LC
Escrowed TI/LC TI/LC Reserves
TI/LC Reserves U/W Reserves Current
Mortgage Reserves Current Annual Initial Annual
Control Loan Initial Annual TI/LC Deposit Deposit
Number Seller Loan / Property Name Deposit Deposit PSF/Unit PSF/Unit PSF/Unit
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
145 SBRC Arlington Heights Apartments NAP NAP NAP NAP NAP
146 LBNA Carriage House Lofts NAP NAP NAP NAP NAP
147 GCM Northpointe Shopping Center 47,376 44,256 0.86 0.92 0.86
148 GCM 2 Willow Street 3,998 47,981 1.20 0.10 1.20
149 SBRC Villa de Mission East NAP NAP NAP NAP NAP
150 GCM Calaveras Landing Shopping Center 0 0 0.48 0.00 0.00
151 GCM Healtheon 125,000 LOC 0 0.95 2.51 LOC 0.00
152 GCM 444 North Wells Street Building 0 0 1.02 0.00 0.00
153 GCM 1600 Corporate Center Drive 8,363 50,176 1.05 0.17 1.05
156 SBRC Town Green at Wilton Center 0 33,685 0.98 0.00 0.98
154 GCM Little Creek Apartments NAP NAP NAP NAP NAP
155 GCM 271 - 285 East Fordham Road 1,426 8,554 0.48 0.08 0.48
157 GCM El Dorado Plaza 6,000 29,316 0.47 0.10 0.47
158 SBRC Tivoli Gardens Apartments NAP NAP NAP NAP NAP
159 SBRC 155 Washington Ave 0 70,268 1.04 0.00 1.04
160 SBRC 370 Convention Way 0 39,900 1.90 0.00 1.90
161 GCM Union Landing Retail Center 0 0 0.50 0.00 0.00
162 GCM Briarwood Apartments NAP NAP NAP NAP NAP
163 SBRC Franklinton Square Shopping Center 0 0 0.28 0.00 0.00
164 GCM Conquistador Apartments NAP NAP NAP NAP NAP
165 GCM Greenhill Corporate Center 150,000 66,000 1.71 4.26 1.87
166 GCM Northridge Apartments NAP NAP NAP NAP NAP
167 GCM Red Coach Village Apartments NAP NAP NAP NAP NAP
168 AMCC K-Mart Shopping Center - Savannah 0 0 0.00 0.00 0.00
169 SBRC The Cascades 0 87,096 1.29 0.00 1.00
170 GCM The Trane Company Building 0 15,000 0.79 0.00 0.30
171 LBNA Chandler's Building 0 28,656 1.09 0.00 1.09
172 AMCC K-Mart Shopping Center - Nashville 0 0 0.00 0.00 0.00
173 AMCC 2150 Joshua's Path 15,000 0 1.80 0.31 0.00
174 AMCC Ver-Sa-Til 0 37,728 0.31 0.00 0.35
175 LBNA Springdale Mall 0 14,946 0.55 0.00 0.14
176 LBNA Frontier Commons/Global Crossing 250,000 0 0.75 3.86 0.00
177 GCM Wythe Shopping Center 35,000 20,109 0.44 0.35 0.20
178 AMCC Pencader Corporate Center 0 15,000 0.73 0.00 0.19
179 LBNA Watermark Office Building 300,000 LOC 0 1.53 6.83 LOC 0.00
180 GCM 801 West Diversey Parkway 0 17,514 1.00 0.00 1.00
181 GCM Lafayette Business Park 0 0 0.54 0.00 0.00
182 GCM Arrow Business Center 2,770 33,240 0.35 0.03 0.35
183 LBNA Palm Haven Mobile Home Park NAP NAP NAP NAP NAP
184 AMCC Cedar Marketplace 0 12,000 0.51 0.00 0.45
185 GCM Crossroads Professional Building 0 60,000 1.19 0.00 1.18
186 LBNA Imperial Crown Center 0 100,000 1.15 0.00 1.50
187 GCM Fran Murphy Building 50,000 0 0.85 1.09 0.00
188 GCM Walgreen's - South Medford 0 0 0.00 0.00 0.00
189 GCM Sav-on and Carl's Jr. 0 0 0.52 0.00 0.00
190 AMCC The Shops at Enon Springs 125,000 16,000 0.65 3.91 0.50
191 AMCC Sierra Heartland Senior Apartments NAP NAP NAP NAP NAP
192 GCM Weatherbridge Center Buildings II and III 4,016 48,192 0.85 0.08 0.95
</TABLE>
<PAGE> 222
MORTGAGE LOAN / MORTGAGED REAL PROPERTY ESCROW INFORMATION
<TABLE>
<CAPTION>
ESCROWED
RECOM- ESCROWED REPLACE-
MENDED U/W REPLACE- MENT
ANNUAL ANNUAL MENT RESERVES
MORTGAGE TAXES INSURANCE REPLACE- REPLACE- RESERVES CURRENT
CONTROL LOAN CURRENTLY CURRENTLY MENT MENT INITIAL ANNUAL
NUMBER SELLER LOAN / PROPERTY NAME ESCROWED ESCROWED RESERVES RESERVES DEPOSIT DEPOSIT
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem Yes Yes 10,047 0 0 0
194 GCM 1201 Sharp Street Yes Yes 6,608 11,826 984 11,808
195 AMCC RPS Warehouse No No 7,550 8,438 0 6,363
196 AMCC 755 & 775 Fiero Lane Yes Yes 1,333 4,390 0 0
197 GCM Redondo Tower Apartments Yes Yes 21,352 21,352 2,024 24,292
198 AMCC Plaza II Office Building Yes Yes 2,500 4,599 0 0
199 LBNA Fountain Place Apartments Yes Yes 26,635 31,320 0 30,740
200 AMCC Carriage House Apartment Yes Yes 7,345 8,209 0 6,000
- Sioux Falls
201 AMCC Carriage House Apartment Yes Yes 7,015 8,050 0 5,000
- Brookings
202 AMCC Carriage House Apartment Yes Yes 6,500 7,500 0 5,000
- Pierre
203 GCM Pioneer Point Apartments Yes Yes 25,470 25,500 2,122 25,470
204 AMCC CVS Harper Center Yes Yes 3,668 4,216 0 3,699
205 SBRC K-Mart Shopping Center Yes Yes 29,629 0 0 0
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive Yes No 667 3,756 939 3,756
207 SBRC Broadway Plaza Building Yes Yes 850 3,508 0 3,508
208 SBRC 225 Long Avenue Yes Yes 21,670 21,980 0 21,980
209 LBNA Almond Grand Gurnee No No 1,158 1,391 0 1,391
210 GCM Summit/Breckenridge Apartments Yes Yes 24,286 26,750 0 26,750
211 GCM Peppertree Apartments Yes Yes 36,342 38,000 3,029 36,342
212 GCM Hillmount Apartments Yes Yes 17,476 25,250 0 25,250
213 AMCC 1500 Renaissance Building Yes Yes 1,208 5,465 0 5,465
214 AMCC Etinuum Office Building Yes No 5,540 3,550 0 3,550
215 AMCC DHR Office Building Yes Yes 1,504 4,943 0 0
216 GCM Oakwood Manor Apartments Yes Yes 10,657 24,000 0 24,000
217 GCM Woodbend Apartments Yes Yes 24,652 25,000 20,400 25,008
218 AMCC Warminster Shopping Center Yes Yes 5,990 6,695 0 6,246
219 AMCC PBR II Yes Yes 5,500 6,147 0 0
220 AMCC PBR I Yes Yes 5,470 6,286 0 0
221 GCM U-Stor Chambers Self-Storage Yes Yes 4,761 5,190 865 5,190
222 GCM 9925-9929 Jefferson Boulevard Yes Yes 5,591 5,591 932 5,591
223 AMCC 810-812 Fiero Lane Yes Yes 808 4,818 0 0
224 AMCC Lab Corp of America Yes Yes 5,468 6,243 0 4,018
225 LBNA Birchbrook Office Park Yes Yes 3,216 3,695 0 4,708
226 GCM Oro Valley Self Storage Yes Yes 2,136 5,232 872 5,232
227 AMCC Hillcrest Retail/Office Shopping Center Yes Yes 1,525 2,885 0 2,010
228 AMCC Cain Drive Warehouses Yes No 12,417 14,277 0 0
229 SBRC Mini-City Self Storage Yes Yes 4,275 9,146 0 9,146
230 AMCC Macy Building Yes Yes 5,316 6,094 0 0
231 GCM Senate Place Apartments Yes Yes 7,923 8,000 0 8,000
232 GCM Eastfield Townhouses Yes Yes 8,329 8,329 0 8,320
233 LBNA Kendall Manor Apartments Yes Yes 16,375 28,350 0 28,350
234 AMCC The Culver Building No No 3,159 4,570 0 0
235 AMCC Harvard Physicians Building Yes Yes 7,661 8,682 0 0
236 AMCC Lyon Street Retail Yes Yes 3,164 3,536 0 0
237 AMCC 350 Newton Avenue Apartments Yes Yes 9,290 10,500 0 0
238 AMCC Solar Gardens Yes Yes 12,823 15,000 0 15,000
239 AMCC Quality Suites Albuquerque Yes Yes 17,650 47,610 0 20,700
240 AMCC Springville Corners Yes Yes 858 3,819 0 3,450
241 AMCC 224-234 East Broad Street Yes Yes 1,500 1,724 0 0
242 GCM 6380 McLeod Drive Yes No 294 3,068 767 3,068
243 AMCC Black Mountain Point Office Building Yes Yes 5,285 6,748 0 0
244 AMCC Waste Management Building No No 5,029 5,589 0 5,589
245 AMCC Silver Lake Plaza Yes Yes 375 2,488 0 0
246 AMCC Checkmate Apartments Yes No 10,122 17,850 0 12,750
247 AMCC Creekside Center Yes Yes 1,667 2,220 0 1,924
248 AMCC Tolt Towne Center Yes No 5,715 6,388 0 0
249 AMCC South Fridley Apartments Yes Yes 18,930 16,000 0 16,000
250 GCM 6668 Owens Drive No No 2,009 2,802 467 2,802
251 GCM 6320 - 6330 McLeod Drive Yes No 1,526 2,350 587 2,350
252 GCM Rite Aid - Hillside Yes Yes 2,618 2,411 3,073 2,090
253 AMCC Howard Johnson Lake Havasu Yes Yes 13,850 30,879 0 14,100
254 LBNA Wickiup Mobile Home & RV Park Yes Yes 2,160 5,550 0 5,500
255 AMCC 261 East 300 South Yes Yes 1,600 4,733 0 0
</TABLE>
<TABLE>
<CAPTION>
ESCROWED
RECOM- ESCROWED REPLACE-
MENDED U/W REPLACE- MENT
ANNUAL ANNUAL MENT RESERVES ESCROWED
REPLACE- REPLACE- RESERVES CURRENT U/W TI/LC
MORTGAGE MENT MENT INITIAL ANNUAL ANNUAL RESERVES
CONTROL LOAN RESERVES RESERVES DEPOSIT DEPOSIT TI/LC INITIAL
NUMBER SELLER LOAN / PROPERTY NAME PSF/UNIT PSF/UNIT PSF/UNIT PSF/UNIT RESERVES DEPOSIT
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem 0.09 0.00 0.00 0.00 0 0
194 GCM 1201 Sharp Street 0.14 0.25 0.02 0.25 47,305 3,942
195 AMCC RPS Warehouse 0.12 0.13 0.00 0.10 16,034 0
196 AMCC 755 & 775 Fiero Lane 0.03 0.10 0.00 0.00 33,322 0
197 GCM Redondo Tower Apartments 222 222 21.09 253 NAP NAP
198 AMCC Plaza II Office Building 0.08 0.15 0.00 0.00 45,082 48,135
199 LBNA Fountain Place Apartments 247 290 0.00 285 NAP NAP
200 AMCC Carriage House Apartment 245 274 0.00 200 NAP NAP
- Sioux Falls
201 AMCC Carriage House Apartment 281 322 0.00 200 NAP NAP
- Brookings
202 AMCC Carriage House Apartment 260 300 0.00 200 NAP NAP
- Pierre
203 GCM Pioneer Point Apartments 255 255 21.22 255 NAP NAP
204 AMCC CVS Harper Center 0.15 0.17 0.00 0.15 21,223 0
205 SBRC K-Mart Shopping Center 0.28 0.00 0.00 0.00 0 0
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 0.03 0.15 0.04 0.15 33,068 0
207 SBRC Broadway Plaza Building 0.04 0.15 0.00 0.15 41,324 0
208 SBRC 225 Long Avenue 0.14 0.14 0.00 0.14 54,457 0
209 LBNA Almond Grand Gurnee 0.08 0.10 0.00 0.10 0 0
210 GCM Summit/Breckenridge Apartments 227 250 0.00 250 NAP NAP
211 GCM Peppertree Apartments 239 250 19.92 239 NAP NAP
212 GCM Hillmount Apartments 173 250 0.00 250 NAP NAP
213 AMCC 1500 Renaissance Building 0.03 0.15 0.00 0.15 33,085 115,000
214 AMCC Etinuum Office Building 0.16 0.10 0.00 0.10 18,387 624,000 LOC
215 AMCC DHR Office Building 0.05 0.15 0.00 0.00 36,861 0
216 GCM Oakwood Manor Apartments 111 250 0.00 250 NAP NAP
217 GCM Woodbend Apartments 247 250 204 250 NAP NAP
218 AMCC Warminster Shopping Center 0.21 0.24 0.00 0.22 21,730 0
219 AMCC PBR II 0.19 0.21 0.00 0.00 18,562 0
220 AMCC PBR I 0.21 0.24 0.00 0.00 16,346 0
221 GCM U-Stor Chambers Self-Storage 0.10 0.10 0.02 0.10 NAP NAP
222 GCM 9925-9929 Jefferson Boulevard 0.14 0.14 0.02 0.14 24,398 0
223 AMCC 810-812 Fiero Lane 0.03 0.15 0.00 0.00 35,269 0
224 AMCC Lab Corp of America 0.20 0.23 0.00 0.15 17,230 75,000
225 LBNA Birchbrook Office Park 0.13 0.15 0.00 0.19 29,445 0
226 GCM Oro Valley Self Storage 0.04 0.10 0.02 0.10 NAP NAP
227 AMCC Hillcrest Retail/Office Shopping Center 0.08 0.15 0.00 0.10 13,125 0
228 AMCC Cain Drive Warehouses 0.25 0.29 0.00 0.00 23,225 0
229 SBRC Mini-City Self Storage 0.05 0.10 0.00 0.10 NAP NAP
230 AMCC Macy Building 0.25 0.28 0.00 0.00 52,206 0
231 GCM Senate Place Apartments 248 250 0.00 250 NAP NAP
232 GCM Eastfield Townhouses 260 260 0.00 260 NAP NAP
233 LBNA Kendall Manor Apartments 202 350 0.00 350 NAP NAP
234 AMCC The Culver Building 0.14 0.20 0.00 0.00 31,342 0
235 AMCC Harvard Physicians Building 0.25 0.28 0.00 0.00 34,811 0
236 AMCC Lyon Street Retail 0.17 0.19 0.00 0.00 13,485 0
237 AMCC 350 Newton Avenue Apartments 221 250 0.00 0.00 NAP NAP
238 AMCC Solar Gardens 214 250 0.00 250 NAP NAP
239 AMCC Quality Suites Albuquerque 256 690 0.00 300 NAP NAP
240 AMCC Springville Corners 0.02 0.11 0.00 0.10 12,203 0
241 AMCC 224-234 East Broad Street 0.16 0.19 0.00 0.00 13,701 0
242 GCM 6380 McLeod Drive 0.01 0.15 0.04 0.15 12,273 0
243 AMCC Black Mountain Point Office Building 0.15 0.19 0.00 0.00 56,921 66,000
244 AMCC Waste Management Building 0.25 0.28 0.00 0.28 7,259 0
245 AMCC Silver Lake Plaza 0.02 0.15 0.00 0.00 9,197 0
246 AMCC Checkmate Apartments 198 350 0.00 250 NAP NAP
247 AMCC Creekside Center 0.11 0.15 0.00 0.13 8,062 75,000
248 AMCC Tolt Towne Center 0.20 0.22 0.00 0.00 14,927 0
249 AMCC South Fridley Apartments 296 250 0.00 250 NAP NAP
250 GCM 6668 Owens Drive 0.11 0.15 0.02 0.15 17,769 200,000
251 GCM 6320 - 6330 McLeod Drive 0.10 0.15 0.04 0.15 11,613 0
252 GCM Rite Aid - Hillside 0.16 0.15 0.19 0.13 11,857 0
253 AMCC Howard Johnson Lake Havasu 295 657 0.00 300 NAP NAP
254 LBNA Wickiup Mobile Home & RV Park 19.46 50.00 0.00 49.55 NAP NAP
255 AMCC 261 East 300 South 0.07 0.20 0.00 0.00 38,885 0
</TABLE>
<TABLE>
<CAPTION>
ESCROWED
ESCROWED ESCROWED TI/LC
TI/LC U/W TI/LC RESERVES
RESERVES ANNUAL RESERVES CURRENT
MORTGAGE CURRENT TI/LC INITIAL ANNUAL
CONTROL LOAN ANNUAL RESERVES DEPOSIT DEPOSIT
NUMBER SELLER LOAN / PROPERTY NAME DEPOSIT PSF/UNIT PSF/UNIT PSF/UNIT
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
193 SBRC K-Mart Shopping Center - Salem 0 0.00 0.00 0.00
194 GCM 1201 Sharp Street 44,004 1.00 0.08 0.93
195 AMCC RPS Warehouse 0 0.25 0.00 0.00
196 AMCC 755 & 775 Fiero Lane 0 0.76 0.00 0.00
197 GCM Redondo Tower Apartments NAP NAP NAP NAP
198 AMCC Plaza II Office Building 0 1.47 1.57 0.00
199 LBNA Fountain Place Apartments NAP NAP NAP NAP
200 AMCC Carriage House Apartment NAP NAP NAP NAP
- Sioux Falls
201 AMCC Carriage House Apartment NAP NAP NAP NAP
- Brookings
202 AMCC Carriage House Apartment NAP NAP NAP NAP
- Pierre
203 GCM Pioneer Point Apartments NAP NAP NAP NAP
204 AMCC CVS Harper Center 0 0.86 0.00 0.00
205 SBRC K-Mart Shopping Center 0 0.00 0.00 0.00
- Salt Lake City
206 GCM 6396, 6392, 6372 McLeod Drive 25,042 1.32 0.00 1.00
207 SBRC Broadway Plaza Building 41,324 1.76 0.00 1.76
208 SBRC 225 Long Avenue 56,520 0.35 0.00 0.36
209 LBNA Almond Grand Gurnee 0 0.00 0.00 0.00
210 GCM Summit/Breckenridge Apartments NAP NAP NAP NAP
211 GCM Peppertree Apartments NAP NAP NAP NAP
212 GCM Hillmount Apartments NAP NAP NAP NAP
213 AMCC 1500 Renaissance Building 10,931 0.91 3.16 0.30
214 AMCC Etinuum Office Building 18,461 0.52 17.58 LOC 0.52
215 AMCC DHR Office Building 21,420 1.12 0.00 0.65
216 GCM Oakwood Manor Apartments NAP NAP NAP NAP
217 GCM Woodbend Apartments NAP NAP NAP NAP
218 AMCC Warminster Shopping Center 0 0.77 0.00 0.00
219 AMCC PBR II 0 0.64 0.00 0.00
220 AMCC PBR I 0 0.62 0.00 0.00
221 GCM U-Stor Chambers Self-Storage NAP NAP NAP NAP
222 GCM 9925-9929 Jefferson Boulevard 50,004 0.63 0.00 1.29
223 AMCC 810-812 Fiero Lane 0 1.11 0.00 0.00
224 AMCC Lab Corp of America 13,392 0.64 2.80 0.50
225 LBNA Birchbrook Office Park 29,445 1.20 0.00 1.20
226 GCM Oro Valley Self Storage NAP NAP NAP NAP
227 AMCC Hillcrest Retail/Office Shopping Center 0 0.68 0.00 0.00
228 AMCC Cain Drive Warehouses 0 0.47 0.00 0.00
229 SBRC Mini-City Self Storage NAP NAP NAP NAP
230 AMCC Macy Building 14,400 2.44 0.00 0.67
231 GCM Senate Place Apartments NAP NAP NAP NAP
232 GCM Eastfield Townhouses NAP NAP NAP NAP
233 LBNA Kendall Manor Apartments NAP NAP NAP NAP
234 AMCC The Culver Building 0 1.37 0.00 0.00
235 AMCC Harvard Physicians Building 0 1.13 0.00 0.00
236 AMCC Lyon Street Retail 0 0.71 0.00 0.00
237 AMCC 350 Newton Avenue Apartments NAP NAP NAP NAP
238 AMCC Solar Gardens NAP NAP NAP NAP
239 AMCC Quality Suites Albuquerque NAP NAP NAP NAP
240 AMCC Springville Corners 0 0.35 0.00 0.00
241 AMCC 224-234 East Broad Street 0 1.49 0.00 0.00
242 GCM 6380 McLeod Drive 12,273 0.60 0.00 0.60
243 AMCC Black Mountain Point Office Building 0 1.63 1.89 0.00
244 AMCC Waste Management Building 8,979 0.36 0.00 0.45
245 AMCC Silver Lake Plaza 0 0.55 0.00 0.00
246 AMCC Checkmate Apartments NAP NAP NAP NAP
247 AMCC Creekside Center 10,360 0.54 5.07 0.70
248 AMCC Tolt Towne Center 0 0.52 0.00 0.00
249 AMCC South Fridley Apartments NAP NAP NAP NAP
250 GCM 6668 Owens Drive 0 0.95 10.70 0.00
251 GCM 6320 - 6330 McLeod Drive 11,613 0.74 0.00 0.74
252 GCM Rite Aid - Hillside 6,665 0.74 0.00 0.41
253 AMCC Howard Johnson Lake Havasu NAP NAP NAP NAP
254 LBNA Wickiup Mobile Home & RV Park NAP NAP NAP NAP
255 AMCC 261 East 300 South 0 1.64 0.00 0.00
</TABLE>
<PAGE> 223
MORTGAGE LOAN / MORTGAGED REAL PROPERTY ESCROW INFORMATION
<TABLE>
<CAPTION>
Escrowed
Recom- Escrowed Replace-
mended U/W Replace- ment
Annual Annual ment Reserves
Mortgage Taxes Insurance Replace- Replace- Reserves Current
Control Loan Currently Currently ment ment Initial Annual
Number Seller Loan / Property Name Escrowed Escrowed Reserves Reserves Deposit Deposit
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments Yes Yes 14,658 20,400 0 20,400
257 AMCC Hawthorne Business Park Yes Yes 10,533 12,561 0 6,300
258 GCM Nogales Self Storage Yes Yes 1,595 4,988 831 4,988
259 GCM Glendale West Self Storage Yes Yes 1,912 5,765 938 5,628
260 AMCC Lovell Building Yes Yes 4,184 4,810 0 0
261 AMCC Nationwide Insurance Office Building No No 3,625 4,592 0 0
262 AMCC Attache Building Yes Yes 2,075 2,146 0 0
263 GCM Airport Business Center Yes Yes 0 3,728 0 3,728
264 AMCC Bluebonnet Apartments Yes Yes 19,020 24,000 0 20,004
265 AMCC 8th Street Apartments Yes No 7,998 12,600 0 9,000
266 LBNA E. M. Jorgensen Building Yes Yes 3,575 4,655 0 4,644
267 AMCC Ralph's Grocery & Deli Yes Yes 1,800 3,342 0 0
268 AMCC Market Square Yes Yes 1,678 1,875 0 0
269 AMCC Blockbuster Video-Salt Lake City Yes Yes 1,339 1,496 0 0
270 AMCC Prudential Wise-McIntire Office Building Yes Yes 1,461 1,633 0 0
271 AMCC Licton Springs Court Apartments Yes Yes 2,727 4,800 0 3,200
272 AMCC Surgicenter of South Bay No No 1,680 1,878 0 0
273 AMCC West Fargo Living Center Yes Yes 2,000 7,200 0 6,000
274 AMCC Edgewood Apartments Yes Yes 4,752 7,200 0 6,000
275 AMCC Washington/Shepherd Retail Center Yes Yes 781 3,814 0 0
276 AMCC Candlewood Apartments Yes Yes 7,704 12,000 0 9,000
277 AMCC Bishop Lifting Products Yes No 6,090 6,299 0 0
278 AMCC 188 State Street Yes Yes 940 2,745 0 0
279 AMCC Woodstone Properties Yes Yes 11,610 12,976 0 10,000
280 AMCC East Gate Manor Apartments Yes Yes 5,369 6,900 0 6,900
</TABLE>
<TABLE>
<CAPTION>
Escrowed
Recom- Escrowed Replace-
mended U/W Replace- ment
Annual Annual ment Reserves
Replace- Replace- Reserves Current U/W
Mortgage ment ment Initial Annual Annual
Control Loan Reserves Reserves Deposit Deposit TI/LC
Number Seller Loan / Property Name PSF/Unit PSF/Unit PSF/Unit PSF/Unit Reserves
------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments 216 300 0.00 300 NAP
257 AMCC Hawthorne Business Park 0.25 0.30 0.00 0.15 21,712
258 GCM Nogales Self Storage 0.03 0.10 0.02 0.10 NAP
259 GCM Glendale West Self Storage 0.03 0.10 0.02 0.10 NAP
260 AMCC Lovell Building 0.21 0.24 0.00 0.00 29,366
261 AMCC Nationwide Insurance Office Building 0.31 0.39 0.00 0.00 15,617
262 AMCC Attache Building 0.20 0.21 0.00 0.00 19,582
263 GCM Airport Business Center 0.00 0.15 0.00 0.15 19,077
264 AMCC Bluebonnet Apartments 238 300 0.00 250 NAP
265 AMCC 8th Street Apartments 222 350 0.00 250 NAP
266 LBNA E. M. Jorgensen Building 0.12 0.15 0.00 0.15 7,935
267 AMCC Ralph's Grocery & Deli 0.16 0.30 0.00 0.00 8,158
268 AMCC Market Square 0.13 0.15 0.00 0.00 10,315
269 AMCC Blockbuster Video-Salt Lake City 0.17 0.19 0.00 0.00 5,458
270 AMCC Prudential Wise-McIntire Office Building 0.17 0.19 0.00 0.00 10,156
271 AMCC Licton Springs Court Apartments 170 300 0.00 200 NAP
272 AMCC Surgicenter of South Bay 0.18 0.20 0.00 0.00 27,612
273 AMCC West Fargo Living Center 83.33 300 0.00 250 NAP
274 AMCC Edgewood Apartments 198 300 0.00 250 NAP
275 AMCC Washington/Shepherd Retail Center 0.04 0.20 0.00 0.00 13,183
276 AMCC Candlewood Apartments 193 300 0.00 225 NAP
277 AMCC Bishop Lifting Products 0.13 0.14 0.00 0.00 7,054
278 AMCC 188 State Street 0.07 0.20 0.00 0.00 14,371
279 AMCC Woodstone Properties 290 324 0.00 250 NAP
280 AMCC East Gate Manor Apartments 233 300 0.00 300 NAP
</TABLE>
<TABLE>
<CAPTION>
Escrowed
Escrowed Escrowed TI/LC
Escrowed TI/LC TI/LC Reserves
TI/LC Reserves U/W Reserves Current
Mortgage Reserves Current Annual Initial Annual
Control Loan Initial Annual TI/LC Deposit Deposit
Number Seller Loan / Property Name Deposit Deposit PSF/Unit PSF/Unit PSF/Unit
-----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
256 AMCC Hyde Park Apartments NAP NAP NAP NAP NAP
257 AMCC Hawthorne Business Park 0 20,958 0.52 0.00 0.50
258 GCM Nogales Self Storage NAP NAP NAP NAP NAP
259 GCM Glendale West Self Storage NAP NAP NAP NAP NAP
260 AMCC Lovell Building 30,000 0 1.44 1.47 0.00
261 AMCC Nationwide Insurance Office Building 0 0 1.34 0.00 0.00
262 AMCC Attache Building 0 0 1.90 0.00 0.00
263 GCM Airport Business Center 26,439 19,077 0.78 1.07 0.78
264 AMCC Bluebonnet Apartments NAP NAP NAP NAP NAP
265 AMCC 8th Street Apartments NAP NAP NAP NAP NAP
266 LBNA E. M. Jorgensen Building 0 7,935 0.26 0.00 0.26
267 AMCC Ralph's Grocery & Deli 0 0 0.74 0.00 0.00
268 AMCC Market Square 0 0 0.82 0.00 0.00
269 AMCC Blockbuster Video-Salt Lake City 0 0 0.68 0.00 0.00
270 AMCC Prudential Wise-McIntire Office Building 0 0 1.17 0.00 0.00
271 AMCC Licton Springs Court Apartments NAP NAP NAP NAP NAP
272 AMCC Surgicenter of South Bay 0 0 2.96 0.00 0.00
273 AMCC West Fargo Living Center NAP NAP NAP NAP NAP
274 AMCC Edgewood Apartments NAP NAP NAP NAP NAP
275 AMCC Washington/Shepherd Retail Center 0 0 0.69 0.00 0.00
276 AMCC Candlewood Apartments NAP NAP NAP NAP NAP
277 AMCC Bishop Lifting Products 0 0 0.16 0.00 0.00
278 AMCC 188 State Street 0 0 1.02 0.00 0.00
279 AMCC Woodstone Properties NAP NAP NAP NAP NAP
280 AMCC East Gate Manor Apartments NAP NAP NAP NAP NAP
</TABLE>
<PAGE> 224
ANNEX B
DECREMENT TABLES FOR CLASS A-1, CLASS A-2,
CLASS B, CLASS C, CLASS D, CLASS E AND CLASS F CERTIFICATES
PERCENTAGE OF INITIAL TOTAL PRINCIPAL BALANCE AT THE SPECIFIED CPRS
(PREPAYMENTS LOCKED OUT THROUGH LOCK-OUT PERIOD, DEFEASANCE PERIOD
AND YIELD MAINTENANCE PERIOD, THEN AT THE FOLLOWING CPR)
CLASS A-1
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------ ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000..................................... 100% 100% 100% 100% 100%
December 18, 2001..................................... 95% 95% 95% 95% 94%
December 18, 2002..................................... 89% 89% 89% 89% 89%
December 18, 2003..................................... 84% 83% 83% 83% 83%
December 18, 2004..................................... 77% 77% 77% 77% 77%
December 18, 2005..................................... 63% 62% 62% 62% 62%
December 18, 2006..................................... 54% 53% 53% 52% 49%
December 18, 2007..................................... 39% 39% 39% 39% 38%
December 18, 2008..................................... 16% 16% 16% 16% 15%
December 18, 2009 and thereafter...................... 0% 0% 0% 0% 0%
Weighted Average Life (in years)...................... 5.7 5.7 5.7 5.6 5.5
</TABLE>
CLASS A-2
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------ ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000..................................... 100% 100% 100% 100% 100%
December 18, 2001..................................... 100% 100% 100% 100% 100%
December 18, 2002..................................... 100% 100% 100% 100% 100%
December 18, 2003..................................... 100% 100% 100% 100% 100%
December 18, 2004..................................... 100% 100% 100% 100% 100%
December 18, 2005..................................... 100% 100% 100% 100% 100%
December 18, 2006..................................... 100% 100% 100% 100% 100%
December 18, 2007..................................... 100% 100% 100% 100% 100%
December 18, 2008..................................... 100% 100% 100% 100% 100%
December 18, 2009..................................... 85% 85% 84% 84% 79%
December 18, 2010 and thereafter...................... 0% 0% 0% 0% 0%
Weighted Average Life (in years)...................... 9.4 9.4 9.4 9.3 9.2
</TABLE>
Annex B-1
<PAGE> 225
PERCENTAGE OF INITIAL TOTAL PRINCIPAL BALANCE AT THE SPECIFIED CPRS
(PREPAYMENTS LOCKED OUT THROUGH LOCK-OUT PERIOD,
DEFEASANCE PERIOD AND YIELD MAINTENANCE PERIOD, THEN AT THE FOLLOWING CPR)
CLASS B
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------ ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000..................................... 100% 100% 100% 100% 100%
December 18, 2001..................................... 100% 100% 100% 100% 100%
December 18, 2002..................................... 100% 100% 100% 100% 100%
December 18, 2003..................................... 100% 100% 100% 100% 100%
December 18, 2004..................................... 100% 100% 100% 100% 100%
December 18, 2005..................................... 100% 100% 100% 100% 100%
December 18, 2006..................................... 100% 100% 100% 100% 100%
December 18, 2007..................................... 100% 100% 100% 100% 100%
December 18, 2008..................................... 100% 100% 100% 100% 100%
December 18, 2009..................................... 100% 100% 100% 100% 100%
December 18, 2010 and thereafter...................... 0% 0% 0% 0% 0%
Weighted Average Life (in years)...................... 9.8 9.8 9.8 9.8 9.7
</TABLE>
CLASS C
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------ ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000..................................... 100% 100% 100% 100% 100%
December 18, 2001..................................... 100% 100% 100% 100% 100%
December 18, 2002..................................... 100% 100% 100% 100% 100%
December 18, 2003..................................... 100% 100% 100% 100% 100%
December 18, 2004..................................... 100% 100% 100% 100% 100%
December 18, 2005..................................... 100% 100% 100% 100% 100%
December 18, 2006..................................... 100% 100% 100% 100% 100%
December 18, 2007..................................... 100% 100% 100% 100% 100%
December 18, 2008..................................... 100% 100% 100% 100% 100%
December 18, 2009..................................... 100% 100% 100% 100% 100%
December 18, 2010 and thereafter...................... 0% 0% 0% 0% 0%
Weighted Average Life (in years)...................... 9.9 9.9 9.9 9.8 9.7
</TABLE>
Annex B-2
<PAGE> 226
PERCENTAGE OF INITIAL TOTAL PRINCIPAL BALANCE AT THE SPECIFIED CPRS
(PREPAYMENTS LOCKED OUT THROUGH LOCK-OUT PERIOD, DEFEASANCE PERIOD AND
YIELD MAINTENANCE PERIOD, THEN AT THE FOLLOWING CPR)
CLASS D
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000....................................... 100% 100% 100% 100% 100%
December 18, 2001....................................... 100% 100% 100% 100% 100%
December 18, 2002....................................... 100% 100% 100% 100% 100%
December 18, 2003....................................... 100% 100% 100% 100% 100%
December 18, 2004....................................... 100% 100% 100% 100% 100%
December 18, 2005....................................... 100% 100% 100% 100% 100%
December 18, 2006....................................... 100% 100% 100% 100% 100%
December 18, 2007....................................... 100% 100% 100% 100% 100%
December 18, 2008....................................... 100% 100% 100% 100% 100%
December 18, 2009....................................... 100% 100% 100% 100% 100%
December 18, 2010 and thereafter........................ 0% 0% 0% 0% 0%
Weighted Average Life (in years)........................ 9.9 9.9 9.9 9.9 9.7
</TABLE>
CLASS E
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000....................................... 100% 100% 100% 100% 100%
December 18, 2001....................................... 100% 100% 100% 100% 100%
December 18, 2002....................................... 100% 100% 100% 100% 100%
December 18, 2003....................................... 100% 100% 100% 100% 100%
December 18, 2004....................................... 100% 100% 100% 100% 100%
December 18, 2005....................................... 100% 100% 100% 100% 100%
December 18, 2006....................................... 100% 100% 100% 100% 100%
December 18, 2007....................................... 100% 100% 100% 100% 100%
December 18, 2008....................................... 100% 100% 100% 100% 100%
December 18, 2009....................................... 100% 100% 100% 100% 100%
December 18, 2010 and thereafter........................ 0% 0% 0% 0% 0%
Weighted Average Life (in years)........................ 9.9 9.9 9.9 9.9 9.7
</TABLE>
Annex B-3
<PAGE> 227
PERCENTAGE OF INITIAL TOTAL PRINCIPAL BALANCE AT THE SPECIFIED CPRS
(PREPAYMENTS LOCKED OUT THROUGH LOCK-OUT PERIOD, DEFEASANCE PERIOD AND
YIELD MAINTENANCE PERIOD, THEN AT THE FOLLOWING CPR)
CLASS F
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000.......................... 100% 100% 100% 100% 100%
December 18, 2001.......................... 100% 100% 100% 100% 100%
December 18, 2002.......................... 100% 100% 100% 100% 100%
December 18, 2003.......................... 100% 100% 100% 100% 100%
December 18, 2004.......................... 100% 100% 100% 100% 100%
December 18, 2005.......................... 100% 100% 100% 100% 100%
December 18, 2006.......................... 100% 100% 100% 100% 100%
December 18, 2007.......................... 100% 100% 100% 100% 100%
December 18, 2008.......................... 100% 100% 100% 100% 100%
December 18, 2009.......................... 100% 100% 100% 100% 100%
December 18, 2010 and thereafter........... 0% 0% 0% 0% 0%
Weighted Average Life (in years)........... 9.9 9.9 9.9 9.9 9.7
</TABLE>
CLASS G
<TABLE>
<CAPTION>
YEAR 0% CPR 25% CPR 50% CPR 75% CPR 100% CPR
---- ------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
December 19, 2000.......................... 100% 100% 100% 100% 100%
December 18, 2001.......................... 100% 100% 100% 100% 100%
December 18, 2002.......................... 100% 100% 100% 100% 100%
December 18, 2003.......................... 100% 100% 100% 100% 100%
December 18, 2004.......................... 100% 100% 100% 100% 100%
December 18, 2005.......................... 100% 100% 100% 100% 100%
December 18, 2006.......................... 100% 100% 100% 100% 100%
December 18, 2007.......................... 100% 100% 100% 100% 100%
December 18, 2008.......................... 100% 100% 100% 100% 100%
December 18, 2009.......................... 100% 100% 100% 100% 100%
December 18, 2010 and thereafter........... 0% 0% 0% 0% 0%
Weighted Average Life (in years)........... 9.9 9.9 9.9 9.9 9.7
</TABLE>
Annex B-4
<PAGE> 228
ANNEX C
FORM OF PAYMENT DATE STATEMENT
C-1
<PAGE> 229
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
135 S. LaSalle Street Suite 1625 Prior Payment:
Chicago, IL 60603 Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
Administrator: Analyst:
REPORTING PACKAGE TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page(s)
-------
<S> <C> <C> <C>
Issue Id: REMIC Certificate Report Closing Date:
ASAP #: Bond Interest Reconciliation First Payment Date:
Monthly Data File Name: Cash Reconciliation Summary Assumed Final Payment Date:
15 Month Historical Loan Status Summary
15 Month Historical Payoff/Loss Summary
Historical Collateral Level Prepayment Report
Delinquent Loan Detail
Mortgage Loan Characteristics
Loan Level Detail
Specially Serviced Report
Modified Loan Detail
Realized Loss Detail
Appraisal Reduction Detail
</TABLE>
CONTACT INFORMATION
================================================================================
Issuer:
Depositor:
Underwriter:
Master Servicer:
Special Servicer:
Rating Agency:
================================================================================
INFORMATION IS AVAILABLE FOR THIS ISSUE FROM THE FOLLOWING SOURCES
================================================================================
<TABLE>
<S> <C>
LaSalle Web Site www.lnbabs.com
LaSalle Bulletin Board (714) 282-3990
LaSalle "ASAP" Fax Back System (714) 282-5518
LaSalle Factor Line (800) 246-5761
================================================================================
</TABLE>
11/29/2000 -- 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 230
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
<TABLE>
<CAPTION>
ORIGINAL OPENING PRINCIPAL PRINCIPAL NEGATIVE CLOSING INTEREST INTEREST PASS-THROUGH
CLASS FACE VALUE(1) BALANCE PAYMENT ADJ. OR LOSS AMORTIZATION BALANCE PAYMENT ADJUSTMENT RATE(2)
CUSIP Per 1,000 Per 1,000 Per 1,000 Per 1,000 Per 1,000 Per 1,000 Per 1,000 Per 1,000 Next Rate(3)
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
===================================================================================================================================
TOTAL P&I PAYMENT 0.00
===================================================================================================================================
</TABLE>
Notes: (1) N denotes notional balance not included in total
(2) Interest Paid minus Interest Adjustment minus Deferred Interest
equals Accrual
(3) Estimated
11/29/2000 -- 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 231
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
BOND INTEREST RECONCILIATION
<TABLE>
<CAPTION>
Deductions Additions
---------------------------------------------- -------------------------------------
Accrued Add. Deferred & Prior Prepay- Other
Accrual Certificate Allocable Trust Accretion Interest Int. Short- ment Interest
-------------
Class Method Days Interest PPIS Expense(1) Interest Losses falls Due Penalties Proceeds(2)
==============================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
============================================================================================================================
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
============================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Remaining
Distributable Interest Outstanding Credit Support
Certificate Payment Interest ---------------------
Interest Amount Shortfalls Original Current(3)
==============================================================
<S> <C> <C> <C> <C>
==============================================================
0.00 0.00 0.00
==============================================================
</TABLE>
(1) Additional Trust Expenses are fees allocated directly to the bond resulting
in a deduction to accrued interest and not carried as an outstanding
shortfall.
(2) Other Interest Proceeds include default interest, PPIE and Recoveries of
Interest.
(3) Determined as follows: (A) the ending balance of all the classes less (B)
the sum of (i) the ending balance of the class and (ii) the ending balance
of all classes which are not subordinate to the class divided by (A).
11/29/2000 -- 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 232
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
CASH RECONCILIATION SUMMARY
INTEREST SUMMARY
================================
<TABLE>
<CAPTION>
<S> <C>
Current Scheduled Interest
Less Deferred Interest
Plus Advance Interest
Plus Unscheduled Interest
PPIS Reducing Scheduled Interest
Less Total Fees Paid To Servicer
Plus Fees Advanced for PPIS
Less Fee Strips Paid by Servicer
Less Misc. Fees & Expenses
Less Non Recoverable Advances
--------------------------------
Interest Due Trust
--------------------------------
Less Trustee Fee
Less Fee Strips Paid by Trust
Less Misc. Fees Paid by Trust
--------------------------------
Remittance Interest
--------------------------------
</TABLE>
SERVICING FEE SUMMARY
===============================
<TABLE>
<CAPTION>
<S> <C>
Current Servicing Fees
Plus Fees Advanced for PPIS
Less Reduction for PPIS
Plus Unscheduled Servicing Fees
-------------------------------
Total Servicing Fees Paid
-------------------------------
</TABLE>
PPIS SUMMARY
================================
<TABLE>
<CAPTION>
<S> <C>
Gross PPIS
Reduced by PPIE
Reduced by Shortfalls in Fees
Reduced by Other Amounts
--------------------------------
PPIS Reducing Scheduled Interest
--------------------------------
PPIS Reducing Servicing Fee
--------------------------------
PPIS Due Certificate
--------------------------------
</TABLE>
PRINCIPAL SUMMARY
==================================
<TABLE>
<CAPTION>
<S> <C>
SCHEDULED PRINCIPAL:
----------------------------------
Current Scheduled Principal
Advanced Scheduled Principal
----------------------------------
Scheduled Principal Distribution
----------------------------------
UNSCHEDULED PRINCIPAL:
----------------------------------
Curtailments
Prepayments in Full
Liquidation Proceeds
Repurchase Proceeds
Other Principal Proceeds
----------------------------------
Unscheduled Principal Distribution
----------------------------------
Remittance Principal
----------------------------------
----------------------------------
Servicer Wire Amount
----------------------------------
</TABLE>
POOL BALANCE SUMMARY
============================================================
<TABLE>
<CAPTION>
Balance Count
============================================================
<S> <C> <C>
Beginning Pool
Scheduled Principal Distribution
Unscheduled Principal Distribution
Deferred Interest
Liquidations
Repurchases
Ending Pool
============================================================
</TABLE>
<TABLE>
<CAPTION>
ADVANCES
----------------------------------------------------------------------------------------------------------
PRIOR OUTSTANDING CURRENT PERIOD RECOVERED ENDING OUTSTANDING
Principal Interest Principal Interest Principal Interest Principal Interest
==========================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
----------------------------------------------------------------------------------------------------------
</TABLE>
11/29/20 - 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 233
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
ASSET BACKED FACTS ~15 MONTH HISTORICAL LOAN STATUS SUMMARY
<TABLE>
<CAPTION>
Delinquency Aging Categories
------------------------------------------------------------------------------------------------------
Distribution Delinq 1 Month Delinq 2 Months Delinq 3+ Months Foreclosure REO
------------------------------------------------------------------------------------------------------
Date # Balance # Balance # Balance # Balance # Balance
============ ======================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
============ ======================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Special Event Categories (1)
---------------------------------------------------------------
Modifications Specially Serviced Bankruptcy
---------------------------------------------------------------
# Balance # Balance # Balance
===============================================================
<S> <C> <C> <C> <C> <C>
===============================================================
</TABLE>
(1) Note: Modification, Specially Serviced & Bankruptcy Totals are Included in
the Appropriate Delinquency Aging Category
11/29/2000 -- 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 234
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
ASSET BACKED FACTS ~15 MONTH HISTORICAL PAYOFF/LOSS SUMMARY
<TABLE>
<CAPTION>
Distribution Ending Pool (1) Payoffs (2) Penalties Appraisal Reduct.(2) Liquidations (2) Realized Losses (2)
---------------------------------------------------------------------------------------------------------------------
Date # Balance # Balance # Amount # Balance # Balance # Amount
============ =====================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
============ =====================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Remaining Term Curr Weighted Avg.
--------------------------------------
Life Amort. Coupon Remit
======================================
<S> <C> <C> <C>
======================================
</TABLE>
(1) Percentage based on pool as of cutoff.
(2) Percentage based on pool as of beginning of period.
11/29/2000 -- 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 235
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
HISTORICAL COLLATERAL LEVEL PREPAYMENT REPORT
<TABLE>
<CAPTION>
Disclosure Distribution Initial Payoff Penalty Prepayment Maturity Property
Control # Date Balance Code Amount Amount Date Date Type State
========================== ======================================== ====================== =========================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
========================== ======================================== ====================== =========================
CUMULATIVE 0 0
====================
</TABLE>
<TABLE>
<CAPTION>
Remaining Term Note
---------------
DSCR Life Amort. Rate
=========================================
<S> <C> <C> <C>
=========================================
</TABLE>
11/29/2000 -- 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 236
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
DELINQUENT LOAN DETAIL
<TABLE>
<CAPTION>
Paid Outstanding Out. Property Special
Disclosure Doc Thru Current P&I P&I Protection Advance Servicer Foreclosure Bankruptcy REO
Control # Date Advance Advances** Advances Description (1) Transfer Date Date Date Date
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
====================================================================================================================================
</TABLE>
A. P&I Advance - Loan in Grace Period
B. P&I Advance - Late Payment but < one month delinq
1. P&I Advance - Loan delinquent 1 month
2. P&I Advance - Loan delinquent 2 months
3. P&I Advance - Loan delinquent 3 months or More
4. Matured Balloon/Assumed Scheduled Payment
================================================================================
** Outstanding P&I Advances include the current period P&I Advance
11/29/2000 - 7:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 237
ABN AMRO Statement Date:
LaSalle Bank N.A. Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
MORTGAGE LOAN CHARACTERISTICS
DISTRIBUTION OF PRINCIPAL BALANCES
<TABLE>
<CAPTION>
=====================================================================================
Current Scheduled # of Scheduled % of Weighted Average
-----------------------
Balances Loans Balance Balance Term Coupon DSCR
=====================================================================================
<S> <C> <C> <C> <C> <C> <C>
=====================================================================================
0 0 0.00%
=====================================================================================
</TABLE>
Average Scheduled Balance
Maximum Scheduled Balance
Minimum Scheduled Balance
DISTRIBUTION OF REMAINING TERM (FULLY AMORTIZING)
<TABLE>
<CAPTION>
==================================================================================
Fully Amortizing # of Scheduled % of Weighted Average
----------------------
Mortgage Loans Loans Balance Balance Term Coupon DSCR
==================================================================================
<S> <C> <C> <C> <C> <C> <C>
==================================================================================
0 0 0.00%
==================================================================================
</TABLE>
Minimum Remaining Term
Maximum Remaining Term
DISTRIBUTION OF MORTGAGE INTEREST RATES
<TABLE>
<CAPTION>
==========================================================================================
Current Mortgage # of Scheduled % of Weighted Average
-------------------------
Interest Rate Loans Balance Balance Term Coupon DSCR
==========================================================================================
<S> <C> <C> <C> <C> <C> <C>
==========================================================================================
0 0 0.00%
==========================================================================================
</TABLE>
Minimum Mortgage Interest Rate 10.0000%
Maximum Mortgage Interest Rate 10.0000%
DISTRIBUTION OF REMAINING TERM (BALLOON)
<TABLE>
<CAPTION>
==========================================================================================================
Balloon # of Scheduled % of Weighted Average
--------------------------
Mortgage Loans Loans Balance Balance Term Coupon DSCR
==========================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
0 to 60
61 to 120
121 to 180
181 to 240
241 to 360
==========================================================================================================
0 0 0.00%
==========================================================================================================
</TABLE>
Minimum Remaining Term 0
Maximum Remaining Term 0
11/29/2000 -- 07:40 (MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 238
ABN AMRO Statement Date:
LaSalle Bank N.A Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
MORTGAGE LOAN CHARACTERISTICS
DISTRIBUTION OF DSCR (CURRENT)
<TABLE>
<CAPTION>
Debt Service # of Scheduled % of
Coverage Ratio Loans Balance Balance WAMM WAC DSCR
================================================================================
<S> <C> <C> <C> <C> <C> <C>
================================================================================
0 0 0.00%
================================================================================
</TABLE>
Maximum DSCR
Minimum DSCR
DISTRIBUTION OF DSCR (CUTOFF)
<TABLE>
<CAPTION>
Debt Service # of Scheduled % of
Coverage Ratio Loans Balance Balance WAMM WAC DSCR
================================================================================
<S> <C> <C> <C> <C> <C> <C>
================================================================================
0 0 0.00%
================================================================================
</TABLE>
Maximum DSCR 0.90
Minimum DSCR 0.90
GEOGRAPHIC DISTRIBUTION
<TABLE>
<CAPTION>
# of Scheduled % of
State Loans Balance Balance WAMM WAC DSCR
===============================================================================
<S> <C> <C> <C> <C> <C> <C>
===============================================================================
0 0.00%
===============================================================================
</TABLE>
11/29/2000 - 07:40 (MXXX-MXXX) (c) 2000 LaSalle Bank N.A.
<PAGE> 239
ABN AMRO Statement Date:
LaSalle Bank N.A.
Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
MORTGAGE LOAN CHARACTERISTICS
DISTRIBUTION OF PROPERTY TYPES
<TABLE>
<CAPTION>
# of Scheduled % of
Property Types Loans Balance Balance WAMM WAC DSCR
===============================================================================
<S> <C> <C> <C> <C> <C> <C>
===============================================================================
0 0 0.00%
===============================================================================
</TABLE>
DISTRIBUTION OF AMORTIZATION TYPE
<TABLE>
<CAPTION>
Current Scheduled # of Scheduled % of
Balances Loans Balance Balance WAMM WAC DSCR
===============================================================================
<S> <C> <C> <C> <C> <C> <C>
</TABLE>
DISTRIBUTION OF LOAN SEASONING
<TABLE>
<CAPTION>
# of Scheduled % of
Number of Years Loans Balance Balance WAMM WAC DSCR
===============================================================================
<S> <C> <C> <C> <C> <C>
===============================================================================
0 0 0.00%
===============================================================================
</TABLE>
DISTRIBUTION OF YEAR LOANS MATURING
<TABLE>
<CAPTION>
# of Scheduled % of
Year Loans Balance Balance WAMM WAC DSCR
===============================================================================
<S> <C> <C> <C> <C> <C> <C>
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009 & Longer
===============================================================================
0 0 0.00%
===============================================================================
</TABLE>
11/29/2000-07:40 (MXXX-MXXX) (c) 2000 LaSalle Bank N.A.
<PAGE> 240
ABN AMRO Statement Date:
LaSalle Bank N.A.
Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
LOAN LEVEL DETAIL
<TABLE>
<CAPTION>
Operating Ending
Disclosure Property Statement Maturity Principal
Control # Grp Type State DSCR NOI Date Date Balance
============================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
============================================================================
W/Avg 0.00 0 0
============================================================================
</TABLE>
<TABLE>
<CAPTION>
Spec. Loan
Note Scheduled Mod. Serv ASER Status Prepayment
Rate P&I Flag Flag Flag Code(1) Amount Penalty Date
==============================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
==============================================================================
0 0 0
==============================================================================
</TABLE>
* NOI and DSCR, if available and reportable under the terms of the Pooling
and Servicing Agreement, are based on information obtained from the related
borrower, and no other party to the agreement shall be held liable for the
accuracy or methodology used to determine such figures.
(1) Legend:
A. P&I Adv - in Grace Period 1. P&I Adv - delinquent 1 month
B. P&I Adv - < one month delinq 2. P&I Adv - delinquent 2 months
3. P&I Adv - delinquent 3+ months 5. Prepaid in Full
4. Mat. Balloon/Assumed P&I 6. Specially Serviced
7. Foreclosure 9. REO
8. Bankruptcy
10. DPO
11. Modification
11/29/2000 - 07:40 (MXXX-MXXX) (c) 2000 LaSalle Bank N.A.
<PAGE> 241
ABN AMRO Statement Date:
LaSalle Bank N.A.
Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
SPECIALLY SERVICED (PART I) ~ LOAN DETAIL
<TABLE>
<CAPTION>
Balance Remaining Term
Disclosure Transfer ------------------ Note Maturity ----------------- Property NOI
Control # Date Scheduled Actual Rate Date Life Amort. Type State NOI DSCR Date
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
</TABLE>
11/29/2000 - 07:40 (MXXX-MXXX) (c) 2000 LaSalle Bank N.A.
<PAGE> 242
ABN AMRO Statement Date:
LaSalle Bank N.A.
Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
SPECIALLY SERVICED LOAN DETAIL (PART II) ~ SERVICER COMMENTS
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Disclosure Resolution Comments
Control # Strategy
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<PAGE> 243
ABN AMRO Statement Date:
LaSalle Bank N.A.
Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
MODIFIED LOAN DETAIL
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Disclosure Modification Modification Modification
Control # Date Code Description
====================================================================================================================================
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<PAGE> 244
ABN AMRO Statement Date:
LaSalle Bank N.A.
Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
REALIZED LOSS DETAIL
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Beginning
Distribution Disclosure Appraisal Appraisal Scheduled
Period Control # Date Value Balance
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<S> <C> <C> <C> <C>
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
CURRENT TOTAL 0.00
CUMULATIVE 0.00
===============================================================================
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Gross Proceeds Aggregate Net Net Proceeds
Gross as a % of Liquidation Liquidation as a % of Realized
Proceeds Sched Principal Expenses * Proceeds Sched. Balance Loss
=========================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
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CURRENT TOTAL 0.00 0.00 0.00 0.00
CUMULATIVE 0.00 0.00 0.00 0.00
=========================================================================================================================
</TABLE>
*Aggregate liquidation expenses also include outstanding P&I advances
and unpaid servicing fees, unpaid trustee fees, etc.
11/29/2000-07:40(MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 245
ABN AMRO Statement Date:
LaSalle Bank N.A.
Payment Date:
Prior Payment:
Next Payment:
Record Date:
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
MIDLAND LOAN SERVICES, INC., AS MASTER SERVICER
LENNAR PARTNERS, INC., AS SPECIAL SERVICER
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 2000-C3
ABN AMRO ACCT: XX-XXXX-XX-X
APPRAISAL REDUCTION DETAIL
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<CAPTION>
Disclosure Appraisal Scheduled Reduction Note Maturity
Control # Red. Date Balance Amount Rate Date
===================================================================================
<S> <C> <C> <C> <C> <C>
</TABLE>
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<CAPTION>
Remaining Term Property Appraisal
Life Amort. Type State DSCR Value Date
===================================================================================
<S> <C> <C> <C> <C> <C> <C>
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11/29/2000-07:40(MXXX-MXXX) (C) 2000 LaSalle Bank N.A.
<PAGE> 246
ANNEX D
GLOBAL CLEARANCE, SETTLEMENT AND TAX DOCUMENTATION PROCEDURES
Except in limited circumstances, the globally offered Salomon Brothers
Mortgage Securities VII, Inc., Commercial Mortgage Pass-Through Certificates,
Series 2000-C3, Classes A-1, A-2, B, C, D and E will be available only in
book-entry form.
The book-entry certificates will be tradable as home market instruments in
both the U.S. and, solely in the case of the class A-1 and A-2 certificates,
European domestic markets. Initial settlement and all secondary trades will
settle in same-day funds.
Secondary market trading between investors holding book-entry certificates
through Clearstream and Euroclear will be conducted in the ordinary way in
accordance with their normal rules and operating procedures and in accordance
with conventional Eurobond practice, which is seven calendar days' settlement.
Secondary market trading between investors holding book-entry certificates
through DTC will be conducted according to the rules and procedures applicable
to U.S. corporate debt obligations.
Secondary cross-market trading between Clearstream or Euroclear and DTC
participants holding book-entry certificates will be accomplished on a delivery
against payment basis through the respective depositaries of Clearstream and
Euroclear, in that capacity, as DTC participants.
As described under "U.S. Federal Income Tax Documentation Requirements"
below, non-U.S. holders of book-entry certificates will be subject to U.S.
withholding taxes unless those holders meet specific requirements and deliver
appropriate U.S. tax documents to the securities clearing organizations of their
participants.
A. INITIAL SETTLEMENT
All certificates of each class of offered certificates will be held in
book-entry form by DTC in the name of Cede & Co. as nominee of DTC. Investors'
interests in the book-entry certificates will be represented through financial
institutions acting on their behalf as direct and indirect DTC participants. As
a result, Clearstream and Euroclear will hold positions on behalf of their
member organizations through their respective depositaries, which in turn will
hold positions in accounts as DTC participants.
Investors' securities custody accounts will be credited with their holdings
against payment in same-day funds on the settlement date.
Investors electing to hold their book-entry certificates through
Clearstream or Euroclear accounts will follow the settlement procedures
applicable to conventional Eurobonds, except that there will be no temporary
global security and no "lock up" or restricted period. Global securities will be
credited to the securities custody accounts on the settlement date against
payment in same-day funds.
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B. SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
Trading between DTC Participants. Secondary market trading between DTC
participants will be settled in same-day funds.
Trading between Clearstream and/or Euroclear Participants. Secondary
market trading between member organizations of Clearstream or Euroclear will be
settled using the procedures applicable to conventional Eurobonds in same-day
funds.
Trading between DTC Seller and Clearstream or Euroclear Purchaser. When
book-entry certificates are to be transferred from the account of a DTC
participant to the account of a member organization of Clearstream or Euroclear,
the purchaser will send instructions to Clearstream or Euroclear through that
member organization at least one business day prior to settlement. Clearstream
or Euroclear, as the case may be, will instruct the respective depositary to
receive the book-entry certificates against payment. Payment will include
interest accrued on the book-entry certificates from and including the last
coupon payment date to and excluding the settlement date, calculated on the
basis of a year of 360 days consisting of twelve 30-day months. Payment will
then be made by the respective depositary to the DTC participant's account
against delivery of the book-entry certificates. After settlement has been
completed, the book-entry certificates will be credited to the respective
clearing system and by the clearing system, in accordance with its usual
procedures, to the account of the member organization of Clearstream or
Euroclear, as the case may be. The securities credit will appear the next day,
European time, and the cash debit will be back-valued to, and the interest on
the book-entry certificates will accrue from, the value date, which would be the
preceding day when settlement occurred in New York. If settlement is not
completed on the intended value date, the Clearstream or Euroclear cash debit
will be valued instead as of the actual settlement date.
Member organizations of Clearstream and Euroclear will need to make
available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to pre-position
funds for settlement, either from cash on hand or existing lines of credit, as
they would for any settlement occurring within Clearstream or Euroclear. Under
this approach, they may take on credit exposure to Clearstream or Euroclear
until the book-entry certificates are credited to their accounts one day later.
As an alternative, if Clearstream or Euroclear has extended a line of
credit to them, member organizations of Clearstream or Euroclear can elect not
to pre-position funds and allow that credit line to be drawn upon to finance
settlement. Under this procedure, the member organizations purchasing book-entry
certificates would incur overdraft charges for one day, assuming they cleared
the overdraft when the book-entry certificates were credited to their accounts.
However, interest on the book-entry certificates would accrue from the value
date. Therefore, in many cases the investment income on the
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book-entry certificates earned during that one-day period may substantially
reduce or offset the amount of those overdraft charges, although this result
will depend on the cost of funds of the respective member organization of
Clearstream or Euroclear.
Since the settlement is taking place during New York business hours, DTC
participants can employ their usual procedures for sending book-entry
certificates to the respective depositary for the benefit of member
organizations of Clearstream or Euroclear. The sale proceeds will be available
to the DTC seller on the settlement date. Thus, to the DTC participant a
cross-market transaction will settle no differently than a trade between two DTC
participants.
Trading between Clearstream or Euroclear Seller and DTC Purchaser. Due to
time zone differences in their favor, member organizations of Clearstream or
Euroclear may employ their customary procedures for transactions in which
book-entry certificates are to be transferred by the respective clearing system,
through the respective depositary, to a DTC participant. The seller will send
instructions to Clearstream or Euroclear through a member organization of
Clearstream or Euroclear at least one business day prior to settlement. In these
cases, Clearstream or Euroclear, as appropriate, will instruct the respective
depositary to deliver the book-entry certificates to the DTC participant's
account against payment. Payment will include interest accrued on the book-entry
certificates from and including the last coupon payment date to and excluding
the settlement date, calculated on the basis of a year of 360 days consisting of
twelve 30-day months. The payment will then be reflected in the account of the
member organization of Clearstream or Euroclear the following day, and receipt
of the cash proceeds in the account of that member organization of Clearstream
or Euroclear would be back-valued to the value date, which would be the
preceding day, when settlement occurred in New York. Should the member
organization of Clearstream or Euroclear have a line of credit with its
respective clearing system and elect to be in debit in anticipation of receipt
of the sale proceeds in its account, the back-valuation will extinguish any
overdraft charges incurred over the one-day period. If settlement is not
completed on the intended value date, which means the trade fails, receipt of
the cash proceeds in the account of the member organization of Clearstream or
Euroclear would instead be valued as of the actual settlement date.
Finally, day traders that use Clearstream or Euroclear and that purchase
book-entry certificates from DTC participants for delivery to member
organizations of Clearstream or Euroclear should note that these trades would
automatically fail on the sale side unless affirmative action were taken. At
least three techniques should be readily available to eliminate this potential
problem:
- borrowing through Clearstream or Euroclear for one day, until the
purchase side of the day trade is reflected in their Clearstream or
Euroclear accounts, in accordance with the clearing system's customary
procedures;
- borrowing the book-entry certificates in the United States from a DTC
participant no later than one day prior to settlement, which would allow
sufficient time for the book-entry certificates to be reflected in their
Clearstream or Euroclear accounts in order to settle the sale side of the
trade; or
D-3
<PAGE> 249
- staggering the value dates for the buy and sell sides of the trade so
that the value date for the purchase from the DTC participant is at least
one day prior to the value date for the sale to the member organization
of Clearstream or Euroclear.
CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
A holder that is not a "United States person" within the meaning of Section
7701(a)(30) of the Internal Revenue Code of 1986 ("United States person")
holding a book-entry certificate through Clearstream, Euroclear or DTC may be
subject to U.S. withholding tax at a rate of 30% unless such holder provides
certain documentation to the Trustee or to the U.S. entity required to withhold
tax (the "U.S. withholding agent") establishing an exemption from withholding.
Before January 1, 2001, a holder that is not a United States person may be
subject to 30% withholding unless:
- the Trustee or the U.S. withholding agent receives a statement--
1. from the holder on Internal Revenue Service ("IRS") Form W-8 (or any
successor or substitute form) that--
(a) is signed by the certificateholder under penalty of perjury,
(b) certifies that such owner is not a United States person, and
(c) provides the name and address of the certificateholder, or
2. from a securities clearing organization, a bank or another financial
institution that holds customers' securities in the ordinary course
of its trade or business that--
(a) is signed under penalties of perjury by an authorized
representative of the financial institution,
(b) states that the financial institution has received an IRS Form
W-8 (or any successor or substitute form) from the
certificateholder or that another financial institution acting
on behalf of the certificateholder has received such IRS Form
W-8 (or any successor or substitute form),
(c) provides the name and address of the certificateholder, and
(d) attaches the IRS Form W-8 (or any successor or substitute form)
provided by the certificateholder;
- the holder provides a properly executed IRS Form 1001 (or any successor
or substitute form) to the Trustee or the U.S. withholding agent;
- the holder provides a properly executed IRS Form 4224 (or any successor
or substitute form) to the Trustee or the U.S. withholding agent;
- interest is paid or collected on behalf of the holder at an address
inside the United States and the holder is a U.S. person, that is exempt
from withholding and complies with the appropriate certification
requirements, if any; or
D-4
<PAGE> 250
- interest is paid at an address inside the United States and backup
withholding is required.
A holder holding book-entry certificates through Clearstream or Euroclear,
or in the case of an IRS Form 1001 or an IRS Form 4224, the holder's agent,
provides the forms and statements referred to above by submitting them to the
person through which he holds an interest in the book-entry certificates, which
is the clearing agency, in the case of persons holding directly on the books of
the clearing agency. Existing forms and statements will remain valid only for
the following periods:
1. a withholding agent holding an existing form or statement that is valid
on or after January 1, 1999, may treat that form or statement as valid until the
earlier of its expiration or December 31, 2000;
2. no existing forms or statements will be effective after December 31,
2000; and
3. existing forms and statements that expire in 2000 will not be effective
after expiration.
The Treasury has promulgated new regulations governing withholding that are
generally effective for payments after December 31, 2000. The new regulations
affect the documentation required from certificateholders that are not United
States persons. The new regulations replace a number of current tax
certification forms (including IRS Forms W-8, 1001 and 4224, as discussed above)
with a new series of IRS Forms W-8 and generally standardize the period of time
for which withholding agents can rely on those forms, although certain of the
new forms may remain valid indefinitely if the certificateholder provides a
United States taxpayer identification number and the information on the form
does not change.
Holders that are not United States persons will be required to provide
updated documentation valid under the new regulations (i.e., an IRS Form W-8BEN
or Form W-8ECI) to the Trustee or the U.S. withholding agent prior to December
31, 2000 to maintain such withholding exemption. Alternatively, holders that are
not United States persons may establish such exemption from withholding at the
time of purchase by providing the Trustee or the U.S. withholding agent with
documentation valid under the new regulations that will remain valid after
December 31, 2000 (i.e., an IRS Form W-8BEN or Form W-8ECI). Prospective
investors are urged to consult their tax advisors with respect to the effect of
the new regulations.
In addition, all holders holding book-entry certificates through
Clearstream, Euroclear or DTC may be subject to backup withholding at a rate of
31% unless the holder:
1. provides a properly executed IRS Form W-8 (or any successor or
substitute form, subject to the same updating requirements before December 31,
2000 listed above in the discussion regarding 30% withholding) if that person is
a not a United States person;
2. provides a properly executed IRS Form W-9 (or any substitute form) if
that person is a United States person; or
D-5
<PAGE> 251
3. is a corporation, within the meaning of Section 7701(a) of the Internal
Revenue Code of 1986, or otherwise establishes that it is a recipient exempt
from United States backup withholding.
This summary does not deal with all aspects of federal income tax
withholding or backup withholding that may be relevant to investors that are not
"U.S. persons" within the meaning of Section 7701(a)(30) of the Internal Revenue
Code. Such investors are advised to consult their own tax advisors for specific
tax advice concerning their holding and disposing of the book-entry
certificates.
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<PAGE> 252
PROSPECTUS
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.,
THE DEPOSITOR
MORTGAGE PASS-THROUGH CERTIFICATES, ISSUABLE IN SERIES
Our name is Salomon Brothers Mortgage Securities VII, Inc. We intend to
offer from time to time mortgage pass-through certificates. These offers may be
made through one or more different methods, including offerings through
underwriters. We do not currently intend to list the offered certificates of any
series on any national securities exchange or the NASDAQ stock market. See
"Method of Distribution."
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THE OFFERED CERTIFICATES: THE TRUST ASSETS:
<S> <C>
The offered certificates will be The assets of each of our trusts will
issuable in series. Each series of include--
offered certificates will--
-- mortgage loans secured by first
-- have its own series and junior liens on, or security
designation, interests in, various interests in
commercial and multifamily real
-- consist of one or more classes properties,
with various payment
characteristics, -- mortgage-backed securities that
directly or indirectly
-- evidence beneficial ownership evidence interests in, or are
interests in a trust directly or indirectly secured
established by us, and by, those types of mortgage
loans, or
-- be payable solely out of the
related trust assets. -- some combination of those types
of mortgage loans and mortgage-backed
No governmental agency or securities.
instrumentality will insure or
guarantee payment on the offered Trust assets may also include letters
certificates. Neither we nor any of of credit, surety bonds, insurance
our affiliates are responsible for policies, guarantees, credit
making payments on the offered derivatives, reserve funds, guaranteed
certificates if collections on the investment contracts, interest rate
related trust assets are exchange agreements, interest rate cap
insufficient. or floor agreements, currency exchange
agreements, or other similar
instruments and agreements.
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In connection with each offering, we will prepare a supplement to this
prospectus in order to describe in more detail the particular certificates being
offered and the related trust assets. In that document, we will also state the
price to public for each class of offered certificates or explain the method for
determining that price. In that document, we will also identify the applicable
lead or managing underwriter(s), if any, and provide information regarding the
relevant underwriting arrangements and the underwriters' compensation. You may
not purchase the offered certificates of any series unless you have also
received the prospectus supplement for that series. YOU SHOULD CAREFULLY
CONSIDER THE RISK FACTORS BEGINNING ON PAGE 15 IN THIS PROSPECTUS, AS WELL AS
THOSE SET FORTH IN THE RELATED PROSPECTUS SUPPLEMENT, PRIOR TO INVESTING.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE OFFERED CERTIFICATES OR PASSED
UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is December 12, 2000.
<PAGE> 253
TABLE OF CONTENTS
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PAGE
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Important Notice About the Information Presented in This
Prospectus............................................... 3
Available Information; Incorporation by Reference........... 3
Summary of Prospectus....................................... 4
Risk Factors................................................ 15
Capitalized Terms Used in this Prospectus................... 38
Description of the Trust Assets............................. 38
Yield and Maturity Considerations........................... 67
Salomon Brothers Mortgage Securities VII, Inc. ............. 74
Description of the Certificates............................. 74
Description of the Governing Documents...................... 86
Description of Credit Support............................... 96
Legal Aspects of Mortgage Loans............................. 99
Federal Income Tax Consequences............................. 114
State and Other Tax Consequences............................ 167
ERISA Considerations........................................ 167
Legal Investment............................................ 172
Use of Proceeds............................................. 174
Method of Distribution...................................... 174
Legal Matters............................................... 176
Financial Information....................................... 176
Rating...................................................... 176
Glossary.................................................... 178
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<PAGE> 254
IMPORTANT NOTICE ABOUT THE INFORMATION PRESENTED IN THIS PROSPECTUS
When deciding whether to invest in any of the offered certificates, you
should only rely on the information contained in this prospectus and the related
prospectus supplement. We have not authorized any dealer, salesman or other
person to give any information or to make any representation that is different.
In addition, information in this prospectus or any related prospectus supplement
is current only as of the date on its cover. By delivery of this prospectus and
any related prospectus supplement, we are not offering to sell any securities,
and are not soliciting an offer to buy any securities, in any state where the
offer and sale is not permitted.
AVAILABLE INFORMATION; INCORPORATION BY REFERENCE
We have filed with the SEC a registration statement under the Securities
Act of 1933, as amended, with respect to the certificates offered by this
prospectus. This prospectus forms a part of the registration statement. This
prospectus and the related prospectus supplement do not contain all of the
information with respect to an offering that is contained in the registration
statement. For further information regarding the documents referred to in this
prospectus and the related prospectus supplement, you should refer to the
registration statement and its exhibits. You can inspect the registration
statement and its exhibits, and make copies of these documents at prescribed
rates, at the public reference facilities maintained by the SEC at its Public
Reference Section, 450 Fifth Street, N.W., Washington, D.C. 20549, and at its
Regional Offices located as follows: Chicago Regional Office, 500 West Madison,
14th Floor, Chicago, Illinois 60661; and New York Regional Office, Seven World
Trade Center, New York, New York 10048. You can also obtain copies of these
materials electronically through the SEC's Web site (http://www.sec.gov).
In connection with each series of offered certificates, we will file or
arrange to have filed with the SEC with respect to the related trust any
periodic reports that are required under the Securities Exchange Act of 1934, as
amended. All documents and reports that are so filed for the related trust prior
to the termination of an offering of certificates are incorporated by reference
into, and should be considered a part of, this prospectus. Upon request, we will
provide without charge to each person receiving this prospectus in connection
with an offering, a copy of any or all documents or reports that are so
incorporated by reference. All requests should be directed to us in writing at
388 Greenwich Street, New York, New York 10013, attention: Secretary, or by
telephone at 212-816-6000.
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<PAGE> 255
SUMMARY OF PROSPECTUS
This summary contains selected information from this prospectus. It does
not contain all of the information you need to consider in making your
investment decision. TO UNDERSTAND ALL OF THE TERMS OF A PARTICULAR OFFERING OF
CERTIFICATES, YOU SHOULD READ CAREFULLY THIS PROSPECTUS AND THE RELATED
PROSPECTUS SUPPLEMENT IN FULL.
WHO WE ARE.................... Salomon Brothers Mortgage Securities VII, Inc.
is a Delaware corporation. Our principal
offices are located at 388 Greenwich Street,
New York, New York 10013. Our main telephone
number is 212-816-6000. We are an indirect,
wholly-owned subsidiary of Salomon Smith Barney
Holdings Inc. and an affiliate of Salomon Smith
Barney Inc. See "Salomon Brothers Mortgage
Securities VII, Inc."
THE SECURITIES BEING
OFFERED....................... The securities that will be offered by this
prospectus and the related prospectus
supplements consist of mortgage pass-through
certificates. These certificates will be issued
in series, and each series will, in turn,
consist of one or more classes. Each class of
offered certificates must, at the time of
issuance, be assigned an investment grade
rating by at least one nationally recognized
statistical rating organization. Typically, the
four highest rating categories, within which
there may be sub-categories or gradations to
indicate relative standing, signify investment
grade. See "Rating."
Each series of offered certificates will
evidence beneficial ownership interests in a
trust established by us and containing the
assets described in this prospectus and the
related prospectus supplement.
THE OFFERED CERTIFICATES MAY
BE ISSUED WITH OTHER
CERTIFICATES.................. We may not publicly offer all the mortgage
pass-through certificates evidencing interests
in one of our trusts. We may elect to retain
some of those certificates, to place some
privately with institutional investors or to
deliver some to the applicable seller as
partial consideration for the related mortgage
assets. In addition, some of those certificates
may not satisfy the rating requirement for
offered certificates described under "--The
Securities Being Offered" above.
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<PAGE> 256
THE GOVERNING DOCUMENTS....... In general, a pooling and servicing agreement
or other similar agreement or collection of
agreements will govern, among other things--
- the issuance of each series of offered
certificates,
- the creation of and transfer of assets to the
related trust, and
- the servicing and administration of those
assets.
The parties to the governing document(s) for a
series of offered certificates will always
include us and a trustee. We will be
responsible for establishing the trust relating
to each series of offered certificates. In
addition, we will transfer or arrange for the
transfer of the initial trust assets to that
trust. In general, the trustee for a series of
offered certificates will be responsible for,
among other things, making payments and
preparing and disseminating various reports to
the holders of those offered certificates.
If the trust assets for a series of offered
certificates include mortgage loans, the
parties to the governing document(s) will also
include--
- a master servicer that will generally be
responsible for performing customary
servicing duties with respect to those
mortgage loans that are not defaulted,
nonperforming or otherwise problematic in any
material respect, and
- a special servicer that will generally be
responsible for servicing and administering
those mortgage loans that are defaulted,
nonperforming or otherwise problematic in any
material respect and real estate assets
acquired as part of the related trust with
respect to defaulted mortgage loans.
The same person or entity, or affiliated
entities, may act as both master servicer and
special servicer for any trust.
If the trust assets for a series of offered
certificates include mortgage-backed
securities, the parties to the governing
document(s) may also include a manager that
will be responsible for performing various
administrative duties with respect to those
mortgage-backed securities. If the related
trustee assumes those duties, however, there
will be no manager.
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<PAGE> 257
In the related prospectus supplement, we will
identify the trustee and any master servicer,
special servicer or manager for each series of
offered certificates and will describe their
respective duties in further detail. See
"Description of the Governing Documents."
CHARACTERISTICS OF THE
MORTGAGE ASSETS............... The trust assets with respect to any series of
offered certificates will, in general, include
mortgage loans. Each of those mortgage loans
will constitute the obligation of one or more
persons to repay a debt. The performance of
that obligation will be secured by a first or
junior lien on, or security interest in, the
ownership, leasehold or other interest(s) of
the related borrower or another person in or
with respect to one or more commercial or
multifamily real properties. In particular,
those properties may include:
- rental or cooperatively-owned buildings with
multiple dwelling units;
- retail properties related to the sale of
consumer goods and other products, or related
to providing entertainment, recreational or
personal services, to the general public;
- office buildings;
- hospitality properties;
- casino properties;
- health care-related facilities;
- industrial facilities;
- warehouse facilities, mini-warehouse
facilities and self-storage facilities;
- restaurants, taverns and other establishments
involved in the food and beverage industry;
- manufactured housing communities, mobile home
parks and recreational vehicle parks;
- recreational and resort properties;
- arenas and stadiums;
- churches and other religious facilities;
- parking lots and garages;
- mixed use properties;
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<PAGE> 258
- other income-producing properties; and
- unimproved land.
The mortgage loans underlying a series of
offered certificates may have a variety of
payment terms. For example, any of those
mortgage loans--
- may provide for the accrual of interest at a
mortgage interest rate that is fixed over its
term, that resets on one or more specified
dates or that otherwise adjusts from time to
time;
- may provide for the accrual of interest at a
mortgage interest rate that may be converted
at the borrower's election from an adjustable
to a fixed interest rate or from a fixed to
an adjustable interest rate;
- may provide for no accrual of interest;
- may provide for level payments to stated
maturity, for payments that reset in amount
on one or more specified dates or for
payments that otherwise adjust from time to
time to accommodate changes in the mortgage
interest rate or to reflect the occurrence of
specified events;
- may be fully amortizing or, alternatively,
may be partially amortizing or nonamortizing,
with a substantial payment of principal due
on its stated maturity date;
- may permit the negative amortization or
deferral of accrued interest;
- may prohibit some or all voluntary
prepayments or require payment of a premium,
fee or charge in connection with those
prepayments;
- may permit defeasance and the release of real
property collateral in connection with that
defeasance;
- may provide for payments of principal,
interest or both, on due dates that occur
monthly, bi-monthly, quarterly,
semi-annually, annually or at some other
interval; and/or
- may have two or more component parts, each
having characteristics that are otherwise
described
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in this prospectus as being attributable to
separate and distinct mortgage loans.
Most, if not all, of the mortgage loans
underlying a series of offered certificates
will be secured by liens on real properties
located in the United States, its territories
and possessions. However, some of those
mortgage loans may be secured by liens on real
properties located outside the United States,
its territories and possessions, provided that
foreign mortgage loans do not represent more
than 10% of the related mortgage asset pool, by
balance.
We do not originate mortgage loans. However,
some or all of the mortgage loans included in
one of our trusts may be originated by our
affiliates.
Neither we nor any of our affiliates will
guarantee or insure repayment of any of the
mortgage loans underlying a series of offered
certificates. Unless we expressly state
otherwise in the related prospectus supplement,
no governmental agency or instrumentality will
guarantee or insure repayment of any of the
mortgage loans underlying a series of offered
certificates. See "Description of the Trust
Assets--Mortgage Loans."
The trust assets with respect to any series of
offered certificates may also include mortgage
participations, mortgage pass-through
certificates, collateralized mortgage
obligations and other mortgage-backed
securities, that evidence an interest in, or
are secured by a pledge of, one or more
mortgage loans of the type described above. We
will not include a mortgage-backed security
among the trust assets with respect to any
series of offered certificates unless--
- the security has been registered under the
Securities Act of 1933, as amended, or
- we would be free to publicly resell the
security without registration.
See "Description of the Trust Assets--Mortgage-
Backed Securities."
We will describe the specific characteristics
of the mortgage assets underlying a series of
offered certificates in the related prospectus
supplement.
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In general, the total outstanding principal
balance of the mortgage assets transferred by
us to any particular trust will equal or exceed
the initial total outstanding principal balance
of the related series of certificates. In the
event that the total outstanding principal
balance of the related mortgage assets
initially delivered by us to the related
trustee is less than the initial total
outstanding principal balance of any series of
certificates, we may deposit or arrange for the
deposit of cash or liquid investments on an
interim basis with the related trustee to cover
the shortfall. For 90 days following the date
of initial issuance of that series of
certificates, we will be entitled to obtain a
release of the deposited cash or investments if
we deliver or arrange for delivery of a
corresponding amount of mortgage assets. If we
fail, however, to deliver mortgage assets
sufficient to make up the entire shortfall, any
of the cash or, following liquidation,
investments remaining on deposit with the
related trustee will be used by the related
trustee to pay down the total principal balance
of the related series of certificates, as
described in the related prospectus supplement.
SUBSTITUTION, ACQUISITION AND
REMOVAL OF MORTGAGE
ASSETS..................... If so specified in the related prospectus
supplement, we or another specified person or
entity may be permitted, at our or its option,
but subject to the conditions specified in that
prospectus supplement, to acquire from the
related trust particular mortgage assets
underlying a series of certificates in exchange
for:
- cash that would be applied to pay down the
principal balances of certificates of that
series; and/or
- other mortgage loans or mortgage-backed
securities that--
1. conform to the description of mortgage
assets in this prospectus, and
2. satisfy the criteria set forth in the
related prospectus supplement.
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In addition, if so specified in the related
prospectus supplement, the related trustee may
be authorized or required, to apply collections
on the mortgage assets underlying a series of
offered certificates to acquire new mortgage
loans or mortgage-backed securities that--
1. conform to the description of mortgage
assets in this prospectus, and
2. satisfy the criteria set forth in the
related prospectus supplement.
No replacement of mortgage assets or
acquisition of new mortgage assets will be
permitted if it would result in a
qualification, downgrade or withdrawal of the
then-current rating assigned by any rating
agency to any class of affected offered
certificates.
CHARACTERISTICS OF THE OFFERED
CERTIFICATES............... An offered certificate may entitle the holder
to receive:
- a stated principal amount;
- interest on a principal balance or notional
amount, at a fixed, variable or adjustable
pass-through rate;
- specified, fixed or variable portions of the
interest, principal or other amounts received
on the related mortgage assets;
- payments of principal, with disproportionate,
nominal or no payments of interest;
- payments of interest, with disproportionate,
nominal or no payments of principal;
- payments of interest or principal that
commence only as of a specified date or only
after the occurrence of specified events,
such as the payment in full of the interest
and principal outstanding on one or more
other classes of certificates of the same
series;
- payments of principal to be made, from time
to time or for designated periods, at a rate
that is--
1. faster and, in some cases, substantially
faster, or
2. slower and, in some cases, substantially
slower,
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than the rate at which payments or other
collections of principal are received on the
related mortgage assets;
- payments of principal to be made, subject to
available funds, based on a specified
principal payment schedule or other
methodology; or
- payments of all or part of the prepayment or
repayment premiums, fees and charges, equity
participations payments or other similar
items received on the related mortgage
assets.
Any class of offered certificates may be senior
or subordinate to one or more other classes of
certificates of the same series, including a
non-offered class of certificates of that
series, for purposes of some or all payments
and/or allocations of losses.
A class of offered certificates may have two or
more component parts, each having
characteristics that are otherwise described in
this prospectus as being attributable to
separate and distinct classes.
We will describe the specific characteristics
of each class of offered certificates in the
related prospectus supplement. See "Description
of the Certificates."
CREDIT SUPPORT AND
REINVESTMENT, INTEREST RATE
AND CURRENCY RELATED
PROTECTION FOR THE OFFERED
CERTIFICATES............... Some classes of offered certificates may be
protected in full or in part against defaults
and losses, or select types of defaults and
losses, on the related mortgage assets through
the subordination of one or more other classes
of certificates of the same series or by other
types of credit support. The other types of
credit support may include a letter of credit,
a surety bond, an insurance policy, a
guarantee, a credit derivative or a reserve
fund. We will describe the credit support, if
any, for each class of offered certificates in
the related prospectus supplement.
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The trust assets with respect to any series of
offered certificates may also include any of
the following agreements:
- guaranteed investment contracts in accordance
with which moneys held in the funds and
accounts established with respect to those
offered certificates will be invested at a
specified rate;
- interest rate exchange agreements, interest
rate cap or floor agreements, or other
agreements and arrangements designed to
reduce the effects of interest rate
fluctuations on the related mortgage assets
or on one or more classes of those offered
certificates; or
- currency exchange agreements or other
agreements and arrangements designed to
reduce the effects of currency exchange rate
fluctuations with respect to the related
mortgage assets and one or more classes of
those offered certificates.
We will describe the types of reinvestment,
interest rate and currency related protection,
if any, for each class of offered certificates
in the related prospectus supplement.
See "Risk Factors," "Description of the Trust
Assets" and "Description of Credit Support."
ADVANCES WITH RESPECT TO THE
MORTGAGE ASSETS............ If the trust assets for a series of offered
certificates include mortgage loans, then, as
and to the extent described in the related
prospectus supplement, the related master
servicer, the related special servicer, the
related trustee, any related provider of credit
support and/or any other specified person may
be obligated to make, or may have the option of
making, advances with respect to those mortgage
loans to cover--
- delinquent scheduled payments of principal
and/or interest, other than balloon payments,
- property protection expenses,
- other servicing expenses, or
- any other items specified in the related
prospectus supplement.
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Any party making advances will be entitled to
reimbursement from subsequent recoveries on the
related mortgage loan and as otherwise
described in this prospectus or the related
prospectus supplement. That party may also be
entitled to receive interest on its advances
for a specified period. See "Description of the
Certificates--Advances."
If the trust assets for a series of offered
certificates include mortgage-backed
securities, we will describe in the related
prospectus supplement any comparable advancing
obligations with respect to those mortgage-
backed securities or the underlying mortgage
loans.
OPTIONAL TERMINATION.......... We will describe in the related prospectus
supplement any circumstances in which a
specified party is permitted or obligated to
purchase or sell any of the mortgage assets
underlying a series of offered certificates. In
particular, a master servicer, special servicer
or other designated party may be permitted or
obligated to purchase or sell--
- all the mortgage assets in any particular
trust, thereby resulting in a termination of
the trust, or
- that portion of the mortgage assets in any
particular trust as is necessary or
sufficient to retire one or more classes of
offered certificates of the related series.
See "Description of the
Certificates--Termination."
FEDERAL INCOME TAX
CONSEQUENCES............... Any class of offered certificates will
constitute or evidence ownership of:
- regular interests or residual interests in a
real estate mortgage investment conduit
within the meaning of Sections 860D(a) of the
Internal Revenue Code of 1986; or
- regular interests in a financial asset
securitization investment trust within the
meaning of Section 860L(a) of the Internal
Revenue Code of 1986; or
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- interests in a grantor trust under Subpart E
of Part I of Subchapter J of the Internal
Revenue Code of 1986.
See "Federal Income Tax Consequences."
ERISA CONSIDERATIONS.......... If you are a fiduciary of an employee benefit
plan or other retirement plan or arrangement,
you should review with your legal advisor
whether the purchase or holding of offered
certificates could give rise to a transaction
that is prohibited or is not otherwise
permissible under applicable law. See "ERISA
Considerations."
LEGAL INVESTMENT.............. If your investment authority is subject to
legal restrictions, you should consult your
legal advisor to determine whether and to what
extent the offered certificates constitute a
legal investment for you. We will specify in
the related prospectus supplement which classes
of the offered certificates will constitute
mortgage related securities for purposes of the
Secondary Mortgage Market Enhancement Act of
1984, as amended. See "Legal Investment."
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RISK FACTORS
You should consider the following factors, as well as the factors set forth
under "Risk Factors" in the related prospectus supplement, in deciding whether
to purchase offered certificates.
LACK OF LIQUIDITY WILL IMPAIR YOUR ABILITY TO SELL YOUR OFFERED CERTIFICATES AND
MAY HAVE AN ADVERSE EFFECT ON THE MARKET VALUE OF YOUR OFFERED CERTIFICATES
The offered certificates may have limited or no liquidity. We cannot assure
you that a secondary market for your offered certificates will develop. There
will be no obligation on the part of anyone to establish a secondary market.
Even if a secondary market does develop for your offered certificates, it may
provide you with less liquidity than you anticipated and it may not continue for
the life of your offered certificates.
We will describe in the related prospectus supplement the information that
will be available to you with respect to your offered certificates. The limited
nature of the information may adversely affect the liquidity of your offered
certificates.
We do not currently intend to list the offered certificates on any national
securities exchange or the NASDAQ stock market.
Lack of liquidity will impair your ability to sell your offered
certificates and may prevent you from doing so at a time when you may want or
need to. Lack of liquidity could adversely affect the market value of your
offered certificates. We do not expect that you will have any redemption rights
with respect to your offered certificates.
If you decide to sell your offered certificates, you may have to sell them
at a discount from the price you paid for reasons unrelated to the performance
of your offered certificates or the related mortgage assets. Pricing information
regarding your offered certificates may not be generally available on an ongoing
basis.
THE MARKET VALUE OF YOUR OFFERED CERTIFICATES MAY BE ADVERSELY AFFECTED BY TO
FACTORS UNRELATED TO THE PERFORMANCE OF YOUR OFFERED CERTIFICATES AND THE
UNDERLYING MORTGAGE ASSETS, SUCH AS FLUCTUATIONS IN INTEREST RATES AND THE
SUPPLY AND DEMAND OF CMBS GENERALLY
The market value of your offered certificates can decline even if those
certificates and the underlying mortgage assets are performing at or above your
expectations.
The market value of your offered certificates will be sensitive to
fluctuations in current interest rates. However, a change in the market value of
your offered certificates as a result of an upward or downward movement in
current interest rates may not equal the change in the market value of your
offered certificates as a result of an equal but opposite movement in interest
rates.
The market value of your offered certificates will also be influenced by
the supply of and demand for commercial mortgage-backed securities generally.
The supply of commercial mortgage-backed securities will depend on, among other
things, the amount of commercial and multifamily mortgage loans, whether newly
originated or held in
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portfolio, that are available for securitization. A number of factors will
affect investors' demand for commercial mortgage-backed securities, including--
- the availability of alternative investments that offer higher yields or
are perceived as being a better credit risk, having a less volatile
market value or being more liquid,
- legal and other restrictions that prohibit a particular entity from
investing in commercial mortgage-backed securities or limit the amount or
types of commercial mortgage-backed securities that it may acquire,
- investors' perceptions regarding the commercial and multifamily real
estate markets, which may be adversely affected by, among other things, a
decline in real estate values or an increase in defaults and foreclosures
on mortgage loans secured by income-producing properties, and
- investors' perceptions regarding the capital markets in general, which
may be adversely affected by political, social and economic events
completely unrelated to the commercial and multifamily real estate
markets.
If you decide to sell your offered certificates, you may have to sell at
discount from the price you paid for reasons unrelated to the performance of
your offered certificates or the related mortgage assets. Pricing information
regarding your offered certificates may not be generally available on an ongoing
basis.
PAYMENTS ON THE OFFERED CERTIFICATES WILL BE MADE SOLELY FROM THE LIMITED ASSETS
OF THE RELATED TRUST, AND THOSE ASSETS MAY BE INSUFFICIENT TO MAKE ALL REQUIRED
PAYMENTS ON THOSE CERTIFICATES
The offered certificates do not represent obligations of any person or
entity and do not represent a claim against any assets other than those of the
related trust. No governmental agency or instrumentality will guarantee or
insure payment on the offered certificates. In addition, neither we nor our
affiliates are responsible for making payments on the offered certificates if
collections on the related trust assets are insufficient. If the related trust
assets are insufficient to make payments on your offered certificates, no other
assets will be available to you for payment of the deficiency, and you will bear
the resulting loss. Any advances made by a master servicer or other party with
respect to the mortgage assets underlying your offered certificates are intended
solely to provide liquidity and not credit support. The party making those
advances will have a right to reimbursement, probably with interest, which is
senior to your right to receive payment on your offered certificates.
ANY CREDIT SUPPORT FOR YOUR OFFERED CERTIFICATES MAY BE INSUFFICIENT TO PROTECT
YOU AGAINST ALL POTENTIAL LOSSES
The Amount of Credit Support Will Be Limited. The rating agencies that
assign ratings to your offered certificates will establish the amount of credit
support, if any, for your offered certificates based on, among other things, an
assumed level of defaults, delinquencies and losses with respect to the related
mortgage assets. Actual losses may,
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however, exceed the assumed levels. See "Description of the
Certificates--Allocation of Losses and Shortfalls" and "Description of Credit
Support." If actual losses on the related mortgage assets exceed the assumed
levels, you may be required to bear the additional losses.
Credit Support May Not Cover All Types of Losses. The credit support, if
any, for your offered certificates may not cover all of your potential losses.
For example, some forms of credit support may not cover or may provide limited
protection against losses that you may suffer by reason of fraud or negligence
or as a result of uninsured casualties at the real properties securing the
underlying mortgage loans. You may be required to bear any losses which are not
covered by the credit support.
Disproportionate Benefits may be Given to Some Classes and Series to the
Detriment of Others. If a form of credit support covers multiple classes or
series and losses exceed the amount of that credit support, it is possible that
the holders of offered certificates of another series or class will be
disproportionately benefited by that credit support to your detriment.
THE INVESTMENT PERFORMANCE OF YOUR OFFERED CERTIFICATES WILL DEPEND UPON
PAYMENTS, DEFAULTS AND LOSSES ON THE UNDERLYING MORTGAGE LOANS; AND THOSE
PAYMENTS, DEFAULTS AND LOSSES MAY BE HIGHLY UNPREDICTABLE
The Terms of the Underlying Mortgage Loans Will Affect Payments on Your
Offered Certificates. Each of the mortgage loans underlying the offered
certificates will specify the terms on which the related borrower must repay the
outstanding principal amount of the loan. The rate, timing and amount of
scheduled payments of principal may vary, and may vary significantly, from
mortgage loan to mortgage loan. The rate at which the underlying mortgage loans
amortize will directly affect the rate at which the principal balance or
notional amount of your offered certificates is paid down or otherwise reduced.
In addition, any mortgage loan underlying the offered certificates may
permit the related borrower during some or all of the loan term to prepay the
loan. In general, a borrower will be more likely to prepay its mortgage loan
when it has an economic incentive to do so, such as obtaining a larger loan on
the same underlying real property or a lower or otherwise more advantageous
interest rate through refinancing. If a mortgage loan includes some form of
prepayment restriction, the likelihood of prepayment should decline. These
restrictions may include--
- an absolute or partial prohibition against voluntary prepayments during
some or all of the loan term, or
- a requirement that voluntary prepayments be accompanied by some form of
prepayment premium, fee or charge during some or all of the loan term.
In many cases, however, there will be no restriction associated with the
application of insurance proceeds or condemnation proceeds as a prepayment of
principal.
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The Terms of the Underlying Mortgage Loans Do Not Provide Absolute
Certainty as Regards the Rate, Timing and Amount of Payments on Your Offered
Certificates. Notwithstanding the terms of the mortgage loans backing your
offered certificates, the amount, rate and timing of payments and other
collections on those mortgage loans will, to some degree, be unpredictable
because of borrower defaults and because of casualties and condemnations with
respect to the underlying real properties.
The investment performance of your offered certificates may vary materially
and adversely from your expectations due to--
- the rate of prepayments and other unscheduled collections of principal on
the underlying mortgage loans being faster or slower than you
anticipated, or
- the rate of defaults on the underlying mortgage loans being faster, or
the severity of losses on the underlying mortgage loans being greater,
than you anticipated.
The actual yield to you, as a holder of an offered certificate, may not
equal the yield you anticipated at the time of your purchase, and the total
return on investment that you expected may not be realized. In deciding whether
to purchase any offered certificates, you should make an independent decision as
to the appropriate prepayment, default and loss assumptions to be used. If the
trust assets underlying your offered certificates include mortgage-backed
securities, the terms of those securities may soften or enhance the effects to
you that may result from prepayments, defaults and losses on the mortgage loans
that ultimately back those securities.
Prepayments on the Underlying Mortgage Loans Will Affect the Average Life
of Your Offered Certificates; and the Rate and Timing of those Prepayments May
Be Highly Unpredictable. Payments of principal and/or interest on your offered
certificates will depend upon, among other things, the rate and timing of
payments on the related mortgage assets. Prepayments on the underlying mortgage
loans may result in a faster rate of principal payments on your offered
certificates, thereby resulting in a shorter average life for your offered
certificates than if those prepayments had not occurred. The rate and timing of
principal prepayments on pools of mortgage loans varies among pools and is
influenced by a variety of economic, demographic, geographic, social, tax and
legal factors. Accordingly, neither you nor we can predict the rate and timing
of principal prepayments on the mortgage loans underlying your offered
certificates. As a result, repayment of your offered certificates could occur
significantly earlier or later, and the average life of your offered
certificates could be significantly shorter or longer, than you expected.
The extent to which prepayments on the underlying mortgage loans ultimately
affect the average life of your offered certificates depends on the terms and
provisions of your offered certificates. A class of offered certificates may
entitle the holders to a pro rata share of any prepayments on the underlying
mortgage loans, to all or a disproportionately large share of those prepayments,
or to none or a disproportionately small share of those prepayments. If you are
entitled to a disproportionately large share of any prepayments on the
underlying mortgage loans, your offered certificates may be retired at an
earlier date. If, however, you are only entitled to a small share of the
prepayments on the
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underlying mortgage loans, the average life of your offered certificates may be
extended. Your entitlement to receive payments, including prepayments, of
principal of the underlying mortgage loans may--
- vary based on the occurrence of specified events, such as the retirement
of one or more other classes of certificates of the same series, or
- be subject to various contingencies, such as prepayment and default rates
with respect to the underlying mortgage loans.
We will describe the terms and provisions of your offered certificates more
fully in the related prospectus supplement.
Prepayments on the Underlying Mortgage Loans Will Affect the Yield on Your
Offered Certificates; and the Rate and Timing of those Prepayments May Be Highly
Unpredictable. If you purchase your offered certificates at a discount or
premium, the yield on your offered certificates will be sensitive to prepayments
on the underlying mortgage loans. If you purchase your offered certificates at a
discount, you should consider the risk that a slower than anticipated rate of
principal payments on the underlying mortgage loans could result in your actual
yield being lower than your anticipated yield. Alternatively, if you purchase
your offered certificates at a premium, you should consider the risk that a
faster than anticipated rate of principal payments on the underlying mortgage
loans could result in your actual yield being lower than your anticipated yield.
The potential effect that prepayments may have on the yield of your offered
certificates will increase as the discount deepens or the premium increases. If
the amount of interest payable on your offered certificates is
disproportionately large, as compared to the amount of principal payable on your
offered certificates, you may fail to recover your original investment under
some prepayment scenarios. The rate and timing of principal prepayments on pools
of mortgage loans varies among pools and is influenced by a variety of economic,
demographic, geographic, social, tax and legal factors. Accordingly, neither you
nor we can predict the rate and timing of principal prepayments on the mortgage
loans underlying your offered certificates.
Delinquencies, Defaults and Losses on the Underlying Mortgage Loans May
Affect the Amount and Timing of Payments on Your Offered Certificates; and the
Rate and Timing of those Delinquencies and Defaults, and the Severity of those
Losses, are Highly Unpredictable. The rate and timing of delinquencies and
defaults, and the severity of losses, on the underlying mortgage loans will
impact the amount and timing of payments on a series of offered certificates to
the extent that their effects are not offset by delinquency advances or some
form of credit support.
Unless otherwise covered by delinquency advances or some form of credit
support, defaults on the underlying mortgage loans may delay payments on a
series of offered certificates while the defaulted mortgage loans are worked-out
or liquidated. However, liquidations of defaulted mortgage loans prior to
maturity could affect the yield and average life of an offered certificate in a
manner similar to a voluntary prepayment.
If you calculate your anticipated yield to maturity based on an assumed
rate of default and amount of losses on the underlying mortgage loans that is
lower than the
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default rate and amount of losses actually experienced, then, to the extent that
you are required to bear the additional losses, your actual yield to maturity
will be lower than you calculated and could, under some scenarios, be negative.
Furthermore, the timing of losses on the underlying mortgage loans can affect
your yield. In general, the earlier you bear any loss on an underlying mortgage
loan, the greater the negative effect on your yield.
See "-- Repayment of a Commercial or Multifamily Mortgage Loan Depends Upon
the Performance and Value of the Underlying Real Property, Which May Decline
Over Time, and the Related Borrower's Ability to Refinance the Property, of
Which There is no Assurance" below.
There is an Increased Risk of Default Associated with Balloon
Payments. Any of the mortgage loans underlying your offered certificates may
be nonamortizing or only partially amortizing. The borrower under a mortgage
loan of that type is required to make substantial payments of principal and
interest, which are commonly called balloon payments, on the maturity date of
the loan. The ability of the borrower to make a balloon payment depends upon the
borrower's ability to refinance or sell the real property securing the loan. The
ability of the borrower to refinance or sell the property will be affected by a
number of factors, including:
- the fair market value and condition of the underlying real property;
- the level of interest rates;
- the borrower's equity in the underlying real property;
- the borrower's financial condition;
- the operating history of the underlying real property;
- changes in zoning and tax laws;
- changes in competition in the relevant area;
- changes in rental rates in the relevant area;
- changes in governmental regulation and fiscal policy;
- prevailing general and regional economic conditions;
- the state of the fixed income and mortgage markets; and
- the availability of credit for multifamily rental or commercial
properties.
See "--Repayment of a Commercial or Multifamily Mortgage Loan Depends Upon
the Performance and Value of the Underlying Real Property, Which May Decline
Over Time, and the Related Borrower's Ability to Refinance the Property, of
Which There is no Assurance" below.
Neither we nor any of our affiliates will be obligated to refinance any
mortgage loan underlying your offered certificates.
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The related master servicer or special servicer may, within prescribed
limits, extend and modify mortgage loans underlying your offered certificates
that are in default or as to which a payment default is imminent in order to
maximize recoveries on the defaulted loans. The related master servicer or
special servicer is only required to determine that any extension or
modification is reasonably likely to produce a greater recovery than a
liquidation of the real property securing the defaulted loan. There is a risk
that the decision of the master servicer or special servicer to extend or modify
a mortgage loan may not in fact produce a greater recovery.
REPAYMENT OF A COMMERCIAL OR MULTIFAMILY MORTGAGE LOAN DEPENDS UPON THE
PERFORMANCE AND VALUE OF THE UNDERLYING REAL PROPERTY, WHICH MAY DECLINE OVER
TIME, AND THE RELATED BORROWER'S ABILITY TO REFINANCE THE PROPERTY, OF WHICH
THERE IS NO ASSURANCE
Most of the Mortgage Loans Underlying Your Offered Certificates Will be
Nonrecourse. You should consider all of the mortgage loans underlying your
offered certificates to be nonrecourse loans. This means that, in the event of a
default, recourse will be limited to the related real property or properties
securing the defaulted mortgage loan. In those cases where recourse to a
borrower or guarantor is permitted by the loan documents, we generally will not
undertake any evaluation of the financial condition of that borrower or
guarantor. Consequently, full and timely payment on each mortgage loan
underlying your offered certificates will depend on one or more of the
following:
- the sufficiency of the net operating income of the applicable real
property;
- the market value of the applicable real property at or prior to maturity;
and
- the ability of the related borrower to refinance or sell the applicable
real property.
In general, the value of a multifamily or commercial property will depend
on its ability to generate net operating income. The ability of an owner to
finance a multifamily or commercial property will depend, in large part, on the
property's value and ability to generate net operating income.
Unless we state otherwise in the related prospectus supplement, none of the
mortgage loans underlying your offered certificates will be insured or
guaranteed by any governmental entity or private mortgage insurer.
The risks associated with lending on multifamily and commercial properties
are inherently different from those associated with lending on the security of
single-family residential properties. This is because multifamily rental and
commercial real estate lending involves larger loans and, as described above,
repayment is dependent upon the successful operation and value of the related
real estate project.
Many Risk Factors are Common to Most or All Multifamily and Commercial
Properties. The following factors, among others, will affect the ability of a
multifamily or commercial property to generate net operating income and,
accordingly, its value:
- the age, design and construction quality of the property;
- perceptions regarding the safety, convenience and attractiveness of the
property;
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- the characteristics of the neighborhood where the property is located;
- the proximity and attractiveness of competing properties;
- the existence and construction of competing properties;
- the adequacy of the property's management and maintenance;
- national, regional or local economic conditions, including plant
closings, industry slowdowns and unemployment rates;
- local real estate conditions, including an increase in or oversupply of
comparable commercial or residential space;
- demographic factors;
- customer tastes and preferences;
- retroactive changes in building codes; and
- changes in governmental rules, regulations and fiscal policies, including
environmental legislation.
Particular factors that may adversely affect the ability of a multifamily
or commercial property to generate net operating income include:
- an increase in interest rates, real estate taxes and other operating
expenses;
- an increase in the capital expenditures needed to maintain the property
or make improvements;
- a decline in the financial condition of a major tenant and, in
particular, a sole tenant or anchor tenant;
- an increase in vacancy rates;
- a decline in rental rates as leases are renewed or replaced; and
- natural disasters and civil disturbances such as earthquakes, hurricanes,
floods, eruptions or riots.
The volatility of net operating income generated by a multifamily or
commercial property over time will be influenced by many of the foregoing
factors, as well as by:
- the length of tenant leases;
- the creditworthiness of tenants;
- the rental rates at which leases are renewed or replaced;
- the percentage of total property expenses in relation to revenue;
- the ratio of fixed operating expenses to those that vary with revenues;
and
- the level of capital expenditures required to maintain the property and
to maintain or replace tenants.
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Therefore, commercial and multifamily properties with short-term or less
creditworthy sources of revenue and/or relatively high operating costs, such as
those operated as hospitality and self-storage properties, can be expected to
have more volatile cash flows than commercial and multifamily properties with
medium- to long-term leases from creditworthy tenants and/or relatively low
operating costs. A decline in the real estate market will tend to have a more
immediate effect on the net operating income of commercial and multifamily
properties with short-term revenue sources and may lead to higher rates of
delinquency or defaults on the mortgage loans secured by those properties.
The Successful Operation of a Multifamily or Commercial Property Depends on
Tenants. Generally, multifamily and commercial properties are subject to
leases. The owner of a multifamily or commercial property typically uses lease
or rental payments for the following purposes:
- to pay for maintenance and other operating expenses associated with the
property;
- to fund repairs, replacements and capital improvements at the property;
and
- to service mortgage loans secured by, and any other debt obligations
associated with operating, the property.
Factors that may adversely affect the ability of a multifamily or
commercial property to generate net operating income from lease and rental
payments include:
- an increase in vacancy rates, which may result from tenants deciding not
to renew an existing lease or discontinuing operations;
- an increase in tenant payment defaults;
- a decline in rental rates as leases are entered into, renewed or extended
at lower rates;
- an increase in the capital expenditures needed to maintain the property
or to make improvements; and
- a decline in the financial condition of a major or sole tenant.
Various factors that will affect the operation and value of a commercial
property include:
- the business operated by the tenants;
- the creditworthiness of the tenants; and
- the number of tenants.
Dependence on a Single Tenant or a Small Number of Tenants Makes a Property
Riskier Collateral. In those cases where an income-producing property is
leased to a single tenant or is primarily leased to one or a small number of
major tenants, a deterioration in the financial condition or a change in the
plan of operations of any of those tenants can have particularly significant
effects on the net operating income generated by the property. If any of those
tenants defaults under or fails to renew its
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lease, the resulting adverse financial effect on the operation of the property
will be substantially more severe than would be the case with respect to a
property occupied by a large number of less significant tenants.
An income-producing property operated for retail, office or industrial
purposes also may be adversely affected by a decline in a particular business or
industry if a concentration of tenants at the property is engaged in that
business or industry.
Tenant Bankruptcy Adversely Affects Property Performance. The bankruptcy
or insolvency of a major tenant, or a number of smaller tenants, at a commercial
property may adversely affect the income produced by the property. Under the
U.S. Bankruptcy Code, a tenant has the option of assuming or rejecting any
unexpired lease. If the tenant rejects the lease, the landlord's claim for
breach of the lease would be a general unsecured claim against the tenant unless
there is collateral securing the claim. The claim would be limited to:
- the unpaid rent reserved under the lease for the periods prior to the
bankruptcy petition or any earlier surrender of the leased premises, plus
- an amount, not to exceed three years' rent, equal to the greater of one
year's rent and 15% of the remaining reserved rent.
The Success of an Income-Producing Property Depends on Reletting Vacant
Spaces. The operations at an income-producing property will be adversely
affected if the owner or property manager is unable to renew leases or relet
space on comparable terms when existing leases expire and/or become defaulted.
Even if vacated space is successfully relet, the costs associated with
reletting, including tenant improvements and leasing commissions in the case of
income-producing properties operated for retail, office or industrial purposes,
can be substantial and could reduce cash flow from the income-producing
properties. Moreover, if a tenant at a income-producing property defaults in its
lease obligations, the landlord may incur substantial costs and experience
significant delays associated with enforcing its rights and protecting its
investment, including costs incurred in renovating and reletting the property.
If an income-producing property has multiple tenants, re-leasing
expenditures may be more frequent than in the case of a property with fewer
tenants, thereby reducing the cash flow generated by the multi-tenanted
property. Multi-tenanted properties may also experience higher continuing
vacancy rates and greater volatility in rental income and expenses.
Property Value May Be Adversely Affected even when Current Operating Income
Is Not. Various factors may affect the value of multifamily and commercial
properties without affecting their current net operating income, including:
- changes in interest rates;
- the availability of refinancing sources;
- changes in governmental regulations, licensing or fiscal policy;
- changes in zoning or tax laws; and
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- potential environmental or other legal liabilities.
Property Management May Affect Property Operations and Value. The
operation of an income-producing property will depend upon the property
manager's performance and viability. The property manager generally is
responsible for:
- responding to changes in the local market;
- planning and implementing the rental structure, including staggering
durations of leases and establishing levels of rent payments;
- operating the property and providing building services;
- managing operating expenses; and
- ensuring that maintenance and capital improvements are carried out in a
timely fashion.
Income-producing properties that derive revenues primarily from short-term
rental commitments, such as hospitality or self-storage properties, generally
require more intensive management than properties leased to tenants under
long-term leases.
By controlling costs, providing appropriate and efficient services to
tenants and maintaining improvements in good condition, a property manager can--
- maintain or improve occupancy rates, business and cash flow,
- reduce operating and repair costs, and
- preserve building value.
On the other hand, management errors can, in some cases, impair the long term
viability of an income-producing property.
Maintaining a Property in Good Condition is Expensive. The owner may be
required to expend a substantial amount to maintain, renovate or refurbish a
commercial or multifamily property. Failure to do so may materially impair the
property's ability to generate cash flow. The effects of poor construction
quality will increase over time in the form of increased maintenance and capital
improvements. Even superior construction will deteriorate over time if
management does not schedule and perform adequate maintenance in a timely
fashion. There can be no assurance that an income-producing property will
generate sufficient cash flow to cover the increased costs of maintenance and
capital improvements in addition to paying debt service on the mortgage loan(s)
that may encumber that property.
Competition Will Adversely Affect the Profitability and Value of an Income-
Producing Property. Some income-producing properties are located in highly
competitive areas. Comparable income-producing properties located in the same
area compete on the basis of a number of factors including:
- rental rates;
- location;
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- type of business or services and amenities offered; and
- nature and condition of the particular property.
The profitability and value of an income-producing property may be
adversely affected by a comparable property that:
- offers lower rents;
- has lower operating costs;
- offers a more favorable location; or
- offers better facilities.
Costs of renovating, refurbishing or expanding an income-producing property
in order to remain competitive can be substantial.
Various Types of Income-Producing Properties May Present Special
Risks. The relative importance of any factor affecting the value or operation
of an income-producing property will depend on the type and use of the property.
In addition, the type and use of a particular income-producing property may
present special risks. For example--
- Health care-related facilities and casinos are subject to significant
governmental regulation of the ownership, operation, maintenance and/or
financing of those properties.
- Multifamily rental properties, manufactured housing communities and
mobile home parks may be subject to rent control or rent stabilization
laws and laws governing landlord/tenant relationships.
- Hospitality and restaurant properties are often operated under franchise,
management or operating agreements, which may be terminable by the
franchisor or operator. Moreover, the transferability of a hotel's or
restaurant's operating, liquor and other licenses upon a transfer of the
hotel or restaurant is subject to local law requirements.
- Depending on their location, recreational and resort properties,
properties that provide entertainment services, hospitality properties,
restaurants and taverns, mini-warehouses and self-storage facilities tend
to be adversely affected more quickly by a general economic downturn than
other types of commercial properties.
- Marinas will be affected by various statutes and government regulations
that govern the use of, and construction on, rivers, lakes and other
waterways.
- Some recreational and hospitality properties may have seasonal
fluctuations and/or may be adversely affected by prolonged unfavorable
weather conditions.
- Churches and other religious facilities may be highly dependent on
donations which are likely to decline as economic conditions decline.
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- Properties used as gas stations, automotive sales and service centers,
dry cleaners, warehouses and industrial facilities may be more likely to
have environmental issues.
Additionally, many types of commercial properties are not readily
convertible to alternative uses if the original use is not successful or may
require significant capital expenditures to effect any conversion to an
alternative use. As a result, the liquidation value of any of those types of
property would be substantially less than would otherwise be the case. See
"Description of the Trust Assets--Mortgage Loans--A Discussion of the Various
Types of Multifamily and Commercial Properties that may Secure Mortgage Loans
Underlying a Series of Offered Certificates."
BORROWER CONCENTRATION WITHIN A TRUST EXPOSES INVESTORS TO GREATER RISK OF
DEFAULT AND LOSS
A particular borrower or group of related borrowers may be associated with
multiple real properties securing the mortgage loans underlying a series of
offered certificates. The bankruptcy or insolvency of, or other financial
problems with respect to, that borrower or group of borrowers could have an
adverse effect on--
- the operation of all of the related real properties, and
- the ability of those properties to produce sufficient cash flow to make
required payments on the related mortgage loans.
For example, if a borrower or group of related borrowers that owns or controls
several real properties experiences financial difficulty at one of those
properties, it could defer maintenance at another of those properties in order
to satisfy current expenses with respect to the first property. That borrower or
group of related borrowers could also attempt to avert foreclosure by filing a
bankruptcy petition that might have the effect of interrupting debt service
payments on all the related mortgage loans for an indefinite period. In
addition, multiple real properties owned by the same borrower or related
borrowers are likely to have common management. This would increase the risk
that financial or other difficulties experienced by the property manager could
have a greater impact on the owner of the related loans.
LOAN CONCENTRATION WITHIN A TRUST EXPOSES INVESTORS TO GREATER RISK OF DEFAULT
AND LOSS
Any of the mortgage assets in one of our trusts may be substantially larger
than the other assets in that trust. In general, the inclusion in a trust of one
or more mortgage assets that have outstanding principal balances that are
substantially larger than the other mortgage assets in the trust can result in
losses that are more severe, relative to the size of the related mortgage asset
pool, than would be the case if the total principal balance of that pool were
distributed more evenly.
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GEOGRAPHIC CONCENTRATION WITHIN A TRUST EXPOSES INVESTORS TO GREATER RISK OF
DEFAULT AND LOSS
If a material concentration of mortgage loans underlying a series of
offered certificates is secured by real properties in a particular locale, state
or region, then the holders of those certificates will have a greater exposure
to:
- any adverse economic developments that occur in the locale, state or
region where the properties are located;
- changes in the real estate market where the properties are located;
- changes in governmental rules and fiscal policies in the governmental
jurisdiction where the properties are located; and
- acts of nature, including floods, tornadoes and earthquakes, in the areas
where properties are located.
CHANGES IN POOL COMPOSITION WILL CHANGE THE NATURE OF YOUR INVESTMENT
The mortgage loans underlying any series of offered certificates will
amortize at different rates and mature on different dates. In addition, some of
those mortgage loans may be prepaid or liquidated. As a result, the relative
composition of the related mortgage asset pool will change over time.
If you purchase certificates with a pass-through rate that is equal to or
calculated based upon a weighted average of interest rates on the underlying
mortgage loans, your pass-through rate will be affected, and may decline, as the
relative composition of the mortgage pool changes.
In addition, as payments and other collections of principal are received
with respect to the underlying mortgage loans, the remaining mortgage pool
backing your offered certificates may exhibit an increased concentration with
respect to property type, number and affiliation of borrowers and geographic
location.
ADJUSTABLE RATE MORTGAGE LOANS MAY ENTAIL GREATER RISKS OF DEFAULT TO LENDERS
THAN FIXED RATE MORTGAGE LOANS
Some or all of the mortgage loans underlying a series of offered
certificates may provide for adjustments to their respective mortgage interest
rates and corresponding adjustments to their respective periodic debt service
payments. As the periodic debt service payment for any of those mortgage loans
increases, the likelihood that cash flow from the underlying real property will
be insufficient to make that periodic debt service payment and pay operating
expenses also increases.
SUBORDINATE DEBT INCREASES THE LIKELIHOOD THAT A BORROWER WILL DEFAULT ON A
MORTGAGE LOAN UNDERLYING YOUR OFFERED CERTIFICATES
Some or all of the mortgage loans included in one of our trusts may permit
the related borrower to encumber the related real property with additional
secured debt.
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Even if a mortgage loan prohibits further encumbrance of the related real
property, a violation of this prohibition may not become evident until the
affected mortgage loan otherwise defaults. Accordingly, a lender, such as one of
our trusts, may not realistically be able to prevent a borrower from incurring
subordinate debt.
The existence of any secured subordinated indebtedness increases the
difficulty of refinancing a mortgage loan at the loan's maturity. In addition,
the related borrower may have difficulty repaying multiple loans. Moreover, the
filing of a petition in bankruptcy by, or on behalf of, a junior lienholder may
stay the senior lienholder from taking action to foreclose out the junior lien.
See "Legal Aspects of Mortgage Loans--Subordinate Financing."
BORROWER BANKRUPTCY PROCEEDINGS CAN DELAY AND IMPAIR RECOVERY ON A MORTGAGE LOAN
UNDERLYING YOUR OFFERED CERTIFICATES
Under the U.S. Bankruptcy Code, the filing of a petition in bankruptcy by
or against a borrower will stay the sale of a real property owned by that
borrower, as well as the commencement or continuation of a foreclosure action.
In addition, if a court determines that the value of a real property is
less than the principal balance of the mortgage loan it secures, the court may
reduce the amount of secured indebtedness to the then-value of the property.
This would make the lender a general unsecured creditor for the difference
between the then-value of the property and the amount of its outstanding
mortgage indebtedness.
A bankruptcy court also may:
- grant a debtor a reasonable time to cure a payment default on a mortgage
loan;
- reduce monthly payments due under a mortgage loan;
- change the rate of interest due on a mortgage loan; or
- otherwise alter a mortgage loan's repayment schedule.
Furthermore, the borrower, as debtor-in-possession, or its bankruptcy
trustee has special powers to avoid, subordinate or disallow debts. In some
circumstances, the claims of a secured lender, such as one of our trusts, may be
subordinated to financing obtained by a debtor-in-possession subsequent to its
bankruptcy.
Under the U.S. Bankruptcy Code, a lender will be stayed from enforcing a
borrower's assignment of rents and leases. The U.S. Bankruptcy Code also may
interfere with a lender's ability to enforce lockbox requirements. The legal
proceedings necessary to resolve these issues can be time consuming and may
significantly delay the receipt of rents. Rents also may escape an assignment to
the extent they are used by borrower to maintain its property or for other court
authorized expenses.
As a result of the foregoing, the related trust's recovery with respect to
borrowers in bankruptcy proceedings may be significantly delayed, and the total
amount ultimately collected may be substantially less than the amount owed.
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TAXES ON FORECLOSURE PROPERTY WILL REDUCE AMOUNTS AVAILABLE TO MAKE PAYMENTS ON
THE OFFERED CERTIFICATES
One of our trusts may be designated, in whole or in part, as a real estate
mortgage investment conduit for federal income tax purposes. If that trust
acquires a real property through a foreclosure or deed in lieu of foreclosure,
then the related special servicer may be required to retain an independent
contractor to operate and manage the property. Receipt of the following types of
income on that property will subject the trust to federal, and possibly state or
local, tax on that income at the highest marginal corporate tax rate:
- any net income from that operation and management that does not consist
of qualifying rents from real property within the meaning of Section
856(d) of the Internal Revenue Code of 1986, and
- any rental income based on the net profits of a tenant or sub-tenant or
allocable to a service that is non-customary in the area and for the type
of building involved.
These taxes would reduce the net proceeds available for payment with respect to
the related offered certificates.
ENVIRONMENTAL LIABILITIES WILL ADVERSELY AFFECT THE VALUE AND OPERATION OF THE
CONTAMINATED PROPERTY AND MAY DETER A LENDER FROM FORECLOSING
There can be no assurance--
- as to the degree of environmental testing conducted at any of the real
properties securing the mortgage loans that back your offered
certificates;
- that the environmental testing conducted by or on behalf of the
applicable originators or any other parties in connection with the
origination of those mortgage loans or otherwise identified all adverse
environmental conditions and risks at the related real properties;
- that the results of the environmental testing were accurately evaluated
in all cases;
- that the related borrowers have implemented or will implement all
operations and maintenance plans and other remedial actions recommended
by any environmental consultant that may have conducted testing at the
related real properties; or
- that the recommended action will fully remediate or otherwise address all
the identified adverse environmental conditions and risks.
Environmental site assessments vary considerably in their content, quality
and cost. Even when adhering to good professional practices, environmental
consultants will sometimes not detect significant environmental problems because
to do an exhaustive environmental assessment would be far too costly and
time-consuming to be practical.
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In addition, the current environmental condition of a real property
securing a mortgage loan underlying your offered certificates could be adversely
affected by--
- tenants at the property, such as gasoline stations or dry cleaners, or
- conditions or operations in the vicinity of the property, such as leaking
underground storage tanks at another property nearby.
Various environmental laws may make a current or previous owner or operator
of real property liable for the costs of removal or remediation of hazardous or
toxic substances on, under or adjacent to the property. Those laws often impose
liability whether or not the owner or operator knew of, or was responsible for,
the presence of the hazardous or toxic substances. For example, there are laws
that impose liability for release of asbestos containing materials into the air
or require the removal or containment of the materials. The owner's liability
for any required remediation generally is unlimited and could exceed the value
of the property and/or the total assets of the owner. In addition, the presence
of hazardous or toxic substances, or the failure to remediate the adverse
environmental condition, may adversely affect the owner's or operator's ability
to use the affected property. In some states, contamination of a property may
give rise to a lien on the property to ensure the costs of cleanup. Depending on
the state, this lien may have priority over the lien of an existing mortgage,
deed of trust or other security instrument. In addition, third parties may seek
recovery from owners or operators of real property for personal injury
associated with exposure to hazardous substances, including asbestos and
lead-based paint. Persons who arrange for the disposal or treatment of hazardous
or toxic substances may be liable for the costs of removal or remediation of the
substances at the disposal or treatment facility.
The federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, as well as other federal and state laws,
provide that a secured lender, such as one of our trusts, may be liable as an
"owner" or "operator" of the real property, regardless of whether the borrower
or a previous owner caused the environmental damage, if--
- agents or employees of the lender are deemed to have participated in the
management of the borrower, or
- the lender actually takes possession of a borrower's property or control
of its day-to-day operations, including through the appointment of a
receiver or foreclosure.
Although recently enacted legislation clarifies the activities in which a
lender may engage without becoming subject to liability under the federal
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, and similar federal laws, that legislation has no applicability to
state environmental laws. Moreover, future laws, ordinances or regulations could
impose material environmental liability.
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Federal law requires owners of residential housing constructed prior to
1978 to disclose to potential residents or purchasers--
- any condition on the property that causes exposure to lead-based paint,
and
- the potential hazards to pregnant women and young children, including
that the ingestion of lead-based paint chips and/or the inhalation of
dust particles from lead-based paint by children can cause permanent
injury, even at low levels of exposure.
Property owners may be liable for injuries to their tenants resulting from
exposure under various laws that impose affirmative obligations on property
owners of residential housing containing lead-based paint.
SOME PROVISIONS IN THE MORTGAGE LOANS UNDERLYING YOUR OFFERED CERTIFICATES MAY
BE CHALLENGED AS BEING UNENFORCEABLE
Cross-Collateralization Arrangements. It may be possible to challenge
cross-collateralization arrangements involving more than one borrower as a
fraudulent conveyance, even if the borrowers are related. If one of those
borrowers were to become a debtor in a bankruptcy case, creditors of the
bankrupt party or the representative of the bankruptcy estate of the bankrupt
party could seek to have the bankruptcy court avoid any lien granted by the
bankrupt party to secure repayment of another borrower's loan. In order to do
so, the court would have to determine that--
- the bankrupt party--
1. was insolvent at the time of granting the lien,
2. was rendered insolvent by the granting of the lien,
3. was left with inadequate capital, or
4. was not able to pay its debts as they matured; and
- the bankrupt party did not, when it allowed its property to be encumbered
by a lien securing the other borrower's loan, receive fair consideration
or reasonably equivalent value for pledging its property for the equal
benefit of the other borrower.
If the court were to conclude that the granting of the lien was an avoidable
fraudulent conveyance, it could nullify the lien or security instrument
effecting the cross-collateralization. The court could also allow the bankrupt
party to recover payments it made under the avoided cross-collateralization.
Prepayment Premiums, Fees and Charges. Under the laws of a number of
states, the enforceability of any mortgage loan provisions that require payment
of a prepayment premium, fee or charge upon an involuntary prepayment, is
unclear. If those provisions were unenforceable, borrowers would have an
incentive to default in order to prepay their loans.
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Due-on-Sale and Debt Acceleration Clauses. Some or all of the mortgage
loans included in one of our trusts may contain a due-on-sale clause, which
permits the lender, with some exceptions, to accelerate the maturity of the
mortgage loan upon the sale, transfer or conveyance of--
- the related real property, or
- a majority ownership interest in the related borrower.
We anticipate that all of the mortgage loans included in one of our trusts
will contain some form of debt-acceleration clause, which permits the lender to
accelerate the debt upon specified monetary or non-monetary defaults by the
related borrower.
The courts of all states will enforce acceleration clauses in the event of
a material payment default. The equity courts of any state, however, may refuse
to allow the foreclosure of a mortgage, deed of trust or other security
instrument or to permit the acceleration of the indebtedness if:
- the default is deemed to be immaterial,
- the exercise of those remedies would be inequitable or unjust, or
- the circumstances would render the acceleration unconscionable.
Assignments of Leases. Some or all of the mortgage loans included in one
of our trusts may be secured by, among other things, an assignment of leases and
rents. Under that document, the related borrower will assign its right, title
and interest as landlord under the leases on the related real property and the
income derived from those leases to the lender as further security for the
related mortgage loan, while retaining a license to collect rents for so long as
there is no default. In the event the borrower defaults, the license terminates
and the lender is entitled to collect rents. In some cases, those assignments
may not be perfected as security interests prior to actual possession of the
cash flow. Accordingly, state law may require that the lender take possession of
the property and obtain a judicial appointment of a receiver before becoming
entitled to collect the rents. In addition, the commencement of bankruptcy or
similar proceedings by or with respect to the borrower will adversely affect the
lender's ability to collect the rents. See "Legal Aspects of Mortgage
Loans--Bankruptcy Laws."
Defeasance. A mortgage loan underlying a series of offered certificates
may permit the related borrower, during the periods specified and subject to the
conditions set forth in the loan, to pledge to the holder of the mortgage loan a
specified amount of direct, non-callable United States government securities and
thereby obtain a release of the related mortgaged property. The cash amount
which a Borrower must expend to purchase, or must deliver to a master servicer
in order for the master servicer to purchase, the required United States
government securities may be in excess of the principal balance of the mortgage
loan. A court could interpret that excess amount as a form of prepayment premium
or could take it into account for usury purposes. In some states, some forms of
prepayment premiums are unenforceable. If the payment of that excess amount were
held to be unenforceable, the remaining portion of the cash amount
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to be delivered may be insufficient to purchase the requisite amount of United
States government securities.
LACK OF INSURANCE COVERAGE EXPOSES A TRUST TO RISK FOR PARTICULAR SPECIAL HAZARD
LOSSES
In general, the standard form of fire and extended coverage policy covers
physical damage to or destruction of the improvements of a property by fire,
lightning, explosion, smoke, windstorm and hail, and riot, strike and civil
commotion, subject to the conditions and exclusions specified in the related
policy. Most insurance policies typically do not cover any physical damage
resulting from, among other things:
- war,
- revolution,
- governmental actions,
- floods and other water-related causes,
- earth movement, including earthquakes, landslides and mudflows,
- wet or dry rot,
- vermin, and
- domestic animals.
Unless the related mortgage loan documents specifically require the
borrower to insure against physical damage arising from these causes, then the
resulting losses may be borne by you as a holder of offered certificates.
GROUND LEASES CREATE RISKS FOR LENDERS THAT ARE NOT PRESENT WHEN LENDING ON AN
ACTUAL OWNERSHIP INTEREST IN A REAL PROPERTY
In order to secure a mortgage loan, a borrower may grant a lien on its
leasehold interest in a real property as tenant under a ground lease. If the
ground base does not provide for notice to a lender of a default thereunder on
the part of the borrower, together with a reasonable opportunity for the lender
to cure the default, the lender may be unable to prevent termination of the
lease and may lose its collateral.
In addition, upon the bankruptcy of a landlord or a tenant under a ground
lease, the debtor entity has the right to assume or reject the ground lease. If
a debtor landlord rejects the lease, the tenant has the right to remain in
possession of its leased premises at the rent reserved in the lease for the
term, including renewals. If a debtor tenant rejects any or all of its leases,
the tenant's lender may not be able to succeed to the tenant's position under
the lease unless the landlord has specifically granted the lender that right. If
both the landlord and the tenant are involved in bankruptcy proceedings, the
trustee for your offered certificates may be unable to enforce the bankrupt
tenant's obligation to refuse to treat as terminated a ground lease rejected by
a bankrupt landlord. In those circumstances, it is possible that the trustee
could be deprived of its security
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interest in the leasehold estate, notwithstanding lender protection provisions
contained in the lease or mortgage loan documents.
CHANGES IN ZONING LAWS MAY ADVERSELY AFFECT THE USE OR VALUE OF A REAL PROPERTY
Due to changes in zoning requirements since construction, an
income-producing property may not comply with current zoning laws, including
density, use, parking and set back requirements. Accordingly, the property may
be a permitted non-conforming structure or the operation of the property may be
a permitted non-conforming use. This means that the owner is not required to
alter the property's structure or use to comply with the new law, but the owner
may be limited in its ability to rebuild the premises "as is" in the event of a
substantial casualty loss. This may adversely affect the cash flow available
following the casualty. If a substantial casualty were to occur, insurance
proceeds may not be sufficient to pay a mortgage loan secured by the property in
full. In addition, if the property were repaired or restored in conformity with
the current law, its value or revenue-producing potential may be less than that
which existed before the casualty.
COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACT OF 1990 MAY BE EXPENSIVE
Under the Americans with Disabilities Act of 1990, all public
accommodations are required to meet federal requirements related to access and
use by disabled persons. If a property does not currently comply with that Act,
the property owner may be required to incur significant costs in order to effect
that compliance. This will reduce the amount of cash flow available to cover
other required maintenance and capital improvements and to pay debt service on
the mortgage loan(s) that may encumber that property. There can be no assurance
that the owner will have sufficient funds to cover the costs necessary to comply
with that Act. In addition, noncompliance could result in the imposition of
fines by the federal government or an award or damages to private litigants.
LITIGATION MAY ADVERSELY AFFECT A BORROWER'S ABILITY TO REPAY ITS MORTGAGE LOAN
The owner of a multifamily or commercial property may be a defendant in a
litigation arising out of, among other things, the following:
- breach of contract involving a tenant, a supplier or other party;
- negligence resulting in a personal injury, or
- responsibility for an environmental problem.
Litigation will divert the owner's attention from operating its property.
If the litigation were decided adversely to the owner, the award to the
plaintiff may adversely affect the owner's ability to repay a mortgage loan
secured by the property.
RESIDUAL INTERESTS IN A REAL ESTATE MORTGAGE INVESTMENT CONDUIT HAVE ADVERSE TAX
CONSEQUENCES
Inclusion of Taxable Income in Excess of Cash Received. If you own a
certificate that is a residual interest in a real estate mortgage investment
conduit or REMIC for
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federal income tax purposes, you will have to report on your income tax return
as ordinary income your pro rata share of the taxable income of that REMIC,
regardless of the amount or timing of your possible receipt of any cash on the
certificate. As a result, your offered certificate may have phantom income early
in the term of the REMIC because the taxable income from the certificate may
exceed the amount of economic income, if any, attributable to the certificate.
While you will have a corresponding amount of tax losses later in the term of
the REMIC, the present value of the phantom income may significantly exceed the
present value of the tax losses. Therefore, the after-tax yield on any REMIC
residual certificate may be significantly less than that of a corporate bond or
other instrument having similar cash flow characteristics. In fact, some offered
certificates that are residual interests, may have a negative value.
You have to report your share of the taxable income and net loss of the
REMIC until all the certificates in the related series have a principal balance
of zero. See "Federal Income Tax Consequences--REMICs."
Some Taxable Income of a Residual Interest Can Not Be Offset Under the
Internal Revenue Code of 1986. A portion of the taxable income from a REMIC
residual certificate may be treated as excess inclusions under the Internal
Revenue Code of 1986. You will have to pay tax on the excess inclusions
regardless of whether you have other credits, deductions or losses. In
particular, the tax on excess inclusion:
- generally will not be reduced by losses from other activities,
- for a tax-exempt holder, will be treated as unrelated business taxable
income, and
- for a foreign holder, will not qualify for any exemption from withholding
tax.
Individuals and Certain Entities Should Not Invest in REMIC Residual
Certificates. The fees and non-interest expenses of a REMIC will be allocated
pro rata to certificates that are residual interests in the REMIC. However,
individuals will only be able to deduct these expenses as miscellaneous itemized
deductions, which are subject to numerous restrictions and limitations under the
Internal Revenue Code of 1986. Therefore, the certificates that are residual
interests generally are not appropriate investments for:
- individuals,
- estates,
- trusts beneficially owned by any individual or estate, and
- pass-through entities having any individual, estate or trust as a
shareholder, member or partner.
In addition, the REMIC residual certificates will be subject to numerous
transfer restrictions. These restrictions will reduce your ability to liquidate
a REMIC residual certificate. For example, unless we indicate otherwise in the
related prospectus supplement, you will not be able to transfer a REMIC residual
certificate to a foreign person or a domestic partnership which has a partner
that is a foreign person under the Internal Revenue Code of 1986.
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See "Federal Income Tax Consequences--REMICs--Taxation of Owners of REMIC
Residual Certificates."
PROBLEMS WITH BOOK-ENTRY REGISTRATION
Your offered certificates may be issued in book-entry form through the
facilities of the Depository Trust Company. As a result--
- you will be able to exercise your rights as a certificateholder only
indirectly through the Depository Trust Company and its participating
organizations;
- you may have only limited access to information regarding your offered
certificates;
- you may suffer delays in the receipt of payments on your offered
certificates; and
- your ability to pledge or otherwise take action with respect to your
offered certificates may be limited due to the lack of a physical
certificate evidencing your ownership of those certificates.
See "Description of the Certificates--Book-Entry Registration and
Definitive Certificates."
POTENTIAL CONFLICTS OF INTEREST CAN AFFECT A PERSON'S PERFORMANCE
The master servicer or special servicer for one of our trusts, or any of
their respective affiliates, may purchase certificates evidencing interests in
that trust.
In addition, the master servicer or special servicer for one of our trusts,
or any of their respective affiliates, may have interests in, or other financial
relationships with, borrowers under the related mortgage loans.
In servicing the mortgage loans in any of our trusts, the related master
servicer and special servicer will each be required to observe the terms of the
governing document(s) for the related series of offered certificates and, in
particular, to act in accordance with the servicing standard described in the
related prospectus supplement. You should consider, however, that either of
these parties, if it or an affiliate owns certificates, or has financial
interests in or other financial dealings with any of the related borrowers, may
have interests when dealing with the mortgage loans underlying your offered
certificates that are in conflict with your interests. For example, if the
related special servicer owns any certificates, it could seek to mitigate the
potential loss on its certificates from a troubled mortgage loan by delaying
enforcement in the hope of realizing greater proceeds in the future. However,
this action by a special servicer could result a lower recovery to the related
trust than would have been the case if the special servicer had not delayed in
taking enforcement action.
Furthermore, the master servicer or special servicer for any of our trusts
may service existing and new loans for third parties, including portfolios of
loans similar to the mortgage loans included in that trust. The properties
securing these other loans may be in the same markets as and compete with the
properties securing mortgage loans in our
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trust. Accordingly, that master servicer or special servicer may be acting on
behalf of parties with conflicting interests.
CAPITALIZED TERMS USED IN THIS PROSPECTUS
From time to time we use capitalized terms in this prospectus. Each of
those capitalized terms will have the meaning assigned to it in the "Glossary"
attached to this prospectus.
DESCRIPTION OF THE TRUST ASSETS
GENERAL
We will be responsible for establishing the trust underlying each series of
offered certificates. The assets of the trust will primarily consist of:
- various types of multifamily and/or commercial mortgage loans;
- mortgage participations, pass-through certificates, collateralized
mortgage obligations or other mortgage-backed securities that directly or
indirectly evidence interests in, or are secured by pledges of, one or
more of various types of multifamily and/or commercial mortgage loans; or
- a combination of mortgage loans and mortgage-backed securities of the
types described above.
We do not originate mortgage loans. Accordingly, we must acquire each of
the mortgage loans to be included in one of our trusts from the originator or a
subsequent assignee. In some cases, that originator or subsequent assignee will
be one of our affiliates.
Unless we indicate otherwise in the related prospectus supplement, we will
acquire, directly or through one of our affiliates, in the secondary market, any
mortgage-backed security to be included in one of our trusts.
Neither we nor any of our affiliates will guarantee any of the mortgage
assets included in one of our trusts. Furthermore, unless we indicate otherwise
in the related prospectus supplement, no governmental agency or instrumentality
will guarantee or insure any of those mortgage assets.
MORTGAGE LOANS
General. Each mortgage loan underlying the offered certificates will
constitute the obligation of one or more persons to repay a debt. That
obligation will be evidenced by a promissory note or bond. In addition, that
obligation will be secured by a mortgage, deed of trust or other security
instrument that creates a first or junior lien on, or security interest in, an
interest in one or more of the following types of real property:
- rental or cooperatively-owned buildings with multiple dwelling units;
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- retail properties related to the sale of consumer goods and other
products to the general public, such as shopping centers, malls, factory
outlet centers, automotive sales centers, department stores and other
retail stores, grocery stores, specialty shops, convenience stores and
gas stations;
- retail properties related to providing entertainment, recreational and
personal services to the general public, such as movie theaters, fitness
centers, bowling alleys, salons, dry cleaners and automotive service
centers;
- office properties;
- hospitality properties, such as hotels, motels and other lodging
facilities;
- casino properties;
- health care-related properties, such as hospitals, skilled nursing
facilities, nursing homes, congregate care facilities and, in some cases,
assisted living centers and senior housing;
- industrial properties;
- warehouse facilities, mini-warehouse facilities and self-storage
facilities;
- restaurants, taverns and other establishments involved in the food and
beverage industry;
- manufactured housing communities, mobile home parks and recreational
vehicle parks;
- recreational and resort properties, such as recreational vehicle parks,
golf courses, marinas, ski resorts and amusement parks;
- arenas and stadiums;
- churches and other religious facilities
- parking lots and garages;
- mixed use properties;
- other income-producing properties; and
- unimproved land.
The real property interests that may be encumbered in order to secure a
mortgage loan underlying your offered certificates, include--
- a fee interest or estate, which consists of ownership of the property for
an indefinite period,
- an estate for years, which consists of ownership of the property for a
specified period of years,
- a leasehold interest or estate, which consists of a right to occupy and
use the property for a specified period of years, subject to the terms
and conditions of a lease,
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- shares in a cooperative corporation which owns the property, or
- any other real estate interest under applicable local law.
Any of these real property interests may be subject to deed restrictions,
easements, rights of way and other matters of public record with respect to the
related property. In addition, the use of, and improvements that may be
constructed on, any particular real property will, in most cases, be subject to
zoning laws and other legal restrictions.
Most, if not all, of the mortgage loans underlying a series of offered
certificates will be secured by liens on real properties located in the United
States, its territories and possessions. However, some of those mortgage loans
may be secured by liens on real properties located outside the United States,
its territories and possessions, provided that foreign mortgage loans do not
represent more than 10% of the related mortgage asset pool, by balance.
If we so indicate in the related prospectus supplement, one or more of the
mortgage loans underlying a series of offered certificates may be secured by a
junior lien on the related real property. However, the loan or loans secured by
the more senior liens on that property may not be included in the related trust.
The primary risk to the holder of a mortgage loan secured by a junior lien on a
real property is the possibility that the foreclosure proceeds remaining after
payment of the loans secured by more senior liens on that property will be
insufficient to pay the junior loan in full. In a foreclosure proceeding, the
sale proceeds are applied--
- first, to the payment of court costs and fees in connection with the
foreclosure,
- second, to the payment of real estate taxes, and
- third, to the payment of any and all principal, interest, prepayment or
acceleration penalties, and other amounts owing to the holder of the
senior loans.
The claims of the holders of the senior loans must be satisfied in full before
the holder of the junior loan receives any payments with respect to the junior
loan. If a lender forecloses on a junior loan, it does so subject to any related
senior loans.
If we so indicate in the related prospectus supplement, the mortgage loans
underlying a series of offered certificates may be delinquent as of the date the
certificates are initially issued. In those cases, we will describe in the
related prospectus supplement--
- the period of the delinquency,
- any forbearance arrangement then in effect,
- the condition of the related real property, and
- the ability of the related real property to generate income to service
the mortgage debt.
We will not, however, transfer any mortgage loan to a trust if we know that the
mortgage loan is, at the time of transfer, more than 90 days delinquent with
respect to any scheduled payment of principal or interest or in foreclosure.
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A Discussion of the Various Types of Multifamily and Commercial Properties
that May Secure Mortgage Loans Underlying a Series of Offered
Certificates. The mortgage loans underlying a series of offered certificates
may be secured by numerous types of multifamily and commercial properties. As we
discuss below under "--Mortgage Loans--Default and Loss Considerations with
Respect to Commercial and Multifamily Mortgage Loans," the adequacy of an
income-producing property as security for a mortgage loan depends in large part
on its value and ability to generate net operating income. Set forth below is a
discussion of some of the various factors that may affect the value and
operations of the indicated types of multifamily and commercial properties.
Multifamily Rental Properties. Factors affecting the value and operation
of a multifamily rental property include:
- the physical attributes of the property, such as its age, appearance,
amenities and construction quality;
- the types of services offered at the property;
- the location of the property;
- the characteristics of the surrounding neighborhood, which may change
over time;
- the rents charged for dwelling units at the property relative to the
rents charged for comparable units at competing properties;
- the ability of management to provide adequate maintenance and insurance;
- the property's reputation;
- the level of mortgage interest rates, which may encourage tenants to
purchase rather than lease housing;
- the existence or construction of competing or alternative residential
properties, including other apartment buildings and complexes,
manufactured housing communities, mobile home parks and single-family
housing;
- the ability of management to respond to competition;
- the tenant mix and whether the property is primarily occupied by workers
from a particular company or type of business, personnel from a local
military base or students;
- adverse local, regional or national economic conditions, which may limit
the amount that may be charged for rents and may result in a reduction in
timely rent payments or a reduction in occupancy levels;
- state and local regulations, which may affect the property owner's
ability to increase rent to the market rent for an equivalent apartment;
- the extent to which the property is subject to land use restrictive
covenants or contractual covenants that require that units be rented to
low income tenants;
- the extent to which the cost of operating the property, including the
cost of utilities and the cost of required capital expenditures, may
increase; and
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- the extent to which increases in operating costs may be passed through to
tenants.
Because units in a multifamily rental property are leased to individuals,
usually for no more than a year, the property is likely to respond relatively
quickly to a downturn in the local economy or to the closing of a major employer
in the area.
Some states regulate the relationship of an owner and its tenants at a
multifamily rental property. Among other things, these states may--
- require written leases;
- require good cause for eviction;
- require disclosure of fees;
- prohibit unreasonable rules;
- prohibit retaliatory evictions;
- prohibit restrictions on a resident's choice of unit vendors;
- limit the bases on which a landlord may increase rent; or
- prohibit a landlord from terminating a tenancy solely by reason of the
sale of the owner's building.
Apartment building owners have been the subject of suits under state Unfair
and Deceptive Practices Acts and other general consumer protection statutes for
coercive, abusive or unconscionable leasing and sales practices.
Some counties and municipalities also impose rent control regulations on
apartment buildings. These regulations may limit rent increases to--
- fixed percentages,
- percentages of increases in the consumer price index,
- increases set or approved by a governmental agency, or
- increases determined through mediation or binding arbitration.
In many cases, the rent control laws do not provide for decontrol of rental
rates upon vacancy of individual units. Any limitations on a landlord's ability
to raise rents at a multifamily rental property may impair the landlord's
ability to repay a mortgage loan secured by the property or to meet operating
costs.
Some multifamily rental properties are subject to land use restrictive
covenants or contractual covenants in favor of federal or state housing
agencies. These covenants generally require that a minimum number or percentage
of units be rented to tenants who have incomes that are substantially lower than
median incomes in the area or region. These covenants may limit the potential
rental rates that may be charged at a multifamily rental property, the potential
tenant base for the property or both. An owner may subject a multifamily rental
property to these covenants in exchange for tax credits or rent subsidies. When
the credits or subsidies cease, net operating income will decline.
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Some mortgage loans underlying the offered certificates will be secured
by--
- the related borrower's interest in multiple units in a residential
condominium project, and
- the related voting rights in the owners' association for the project.
Due to the nature of condominiums, a default on any of those mortgage loans will
not allow the related special servicer the same flexibility in realizing on the
real property collateral as is generally available with respect to multifamily
rental properties that are not condominiums. The rights of other unit owners,
the governing documents of the owners' association and the state and local laws
applicable to condominiums must be considered and respected. Consequently,
servicing and realizing upon the collateral for those mortgage loans could
subject the related trust to greater delay, expense and risk than a loan secured
by a multifamily rental property that is not a condominium.
Cooperatively-Owned Apartment Buildings. Some multifamily properties are
owned or leased by cooperative corporations. In general, each shareholder in the
corporation is entitled to occupy a particular apartment unit under a long-term
proprietary lease or occupancy agreement.
A tenant/shareholder of a cooperative corporation must make a monthly
maintenance payment to the corporation. The monthly maintenance payment
represents a tenant/shareholder's pro rata share of the corporation's--
- mortgage loan payments,
- real property taxes,
- maintenance expenses, and
- other capital and ordinary expenses of the property.
These monthly maintenance payments are in addition to any payments of principal
and interest the tenant/shareholder must make on any loans of the
tenant/shareholder secured by its shares in the corporation.
A cooperative corporation is directly responsible for building maintenance
and payment of real estate taxes and hazard and liability insurance premiums. A
cooperative corporation's ability to meet debt service obligations on a mortgage
loan secured by, and to pay all other operating expenses of, the cooperatively
owned property depends primarily upon the receipt of--
- maintenance payments from the tenant/shareholders, and
- any rental income from units or commercial space that the cooperative
corporation might control.
A cooperative corporation may have to impose special assessments on the
tenant/ shareholders in order to pay unanticipated expenditures. Accordingly, a
cooperative corporation is highly dependent on the financial well being of its
tenant/shareholders. A cooperative corporation's ability to pay the amount of
any balloon payment due at the
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maturity of a mortgage loan secured by the cooperatively owned property depends
primarily on its ability to refinance the property.
In a typical cooperative conversion plan, the owner of a rental apartment
building contracts to sell the building to a newly formed cooperative
corporation. Shares are allocated to each apartment unit by the owner or
sponsor. The current tenants have a specified period to subscribe at prices
discounted from the prices to be offered to the public after that period. As
part of the consideration for the sale, the owner or sponsor receives all the
unsold shares of the cooperative corporation. In general the sponsor controls
the corporation's board of directors and management for a limited period of
time. If the sponsor holds the shares allocated to a large number of apartment
units, the lender on a mortgage loan secured by a cooperatively owned property
may be adversely affected by a decline in the creditworthiness of the sponsor.
Many cooperative conversion plans are non-eviction plans. Under a
non-eviction plan, a tenant at the time of conversion who chooses not to
purchase shares is entitled to reside in its apartment unit as a subtenant from
the owner of the shares allocated to that unit. Any applicable rent control or
rent stabilization laws would continue to be applicable to the subtenancy. In
addition, the subtenant may be entitled to renew its lease for an indefinite
number of years with continued protection from rent increases above those
permitted by any applicable rent control and rent stabilization laws. The
owner/shareholder is responsible for the maintenance payments to the cooperative
corporation without regard to whether it receives rent from the subtenant or
whether the rent payments are lower than maintenance payments on the unit.
Newly-formed cooperative corporations typically have the greatest concentration
of non-tenant/ shareholders.
Retail Properties. The term "retail property" encompasses a broad range
of properties at which businesses sell consumer goods and other products and
provide various entertainment, recreational or personal services to the general
public. Some examples of retail properties include:
- shopping centers,
- factory outlet centers,
- malls,
- automotive sales and service centers,
- consumer oriented businesses,
- department stores,
- grocery stores,
- convenience stores,
- specialty shops,
- gas stations,
- movie theaters,
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- fitness centers,
- bowling alleys,
- salons, and
- dry cleaners
Unless owner occupied, retail properties generally derive all or a
substantial percentage of their income from lease payments from commercial
tenants. Therefore, it is important for the owner of a retail property to
attract and keep tenants, particularly significant tenants, that are able to
meet their lease obligations. In order to attract tenants, the owner of a retail
property may be required--
- to lower rents;
- to grant a potential tenant a free rent or reduced rent period;
- to improve the condition of the property generally; or
- to make at its own expense, or grant a rent abatement to cover, tenant
improvements for a potential tenant.
A prospective tenant will also be interested in the number and type of
customers that it will be able to attract at a particular retail property. The
ability of a tenant at a particular retail property to attract customers will be
affected by a number of factors related to the property and the surrounding
area, including--
- competition from other retail properties;
- perceptions regarding the safety, convenience and attractiveness of the
property;
- perceptions regarding the safety of the surrounding area;
- demographics of the surrounding area;
- the strength and stability of the local, regional and national economies;
- traffic patterns and access to major thoroughfares;
- the visibility of the property;
- availability of parking;
- the particular mixture of the goods and services offered at the property;
- customer tastes, preferences and spending patterns; and
- the drawing power of other tenants.
The success of a retail property is often dependent on the success of its
tenants' businesses. A significant component of the total rent paid by tenants
of retail properties is often tied to a percentage of gross sales or revenues.
Declines in sales or revenues of the tenants will likely cause a corresponding
decline in percentage rents and/or impair the tenants' ability to pay their rent
or other occupancy costs. A default by a tenant under its lease could result in
delays and costs in enforcing the landlord's rights. Retail
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properties would be directly and adversely affected by a decline in the local
economy and reduced consumer spending.
Repayment of a mortgage loan secured by a retail property will be affected
by the expiration of space leases at the property and the ability of the
borrower to renew or relet the space on comparable terms. Even if vacant space
is successfully relet, the costs associated with reletting, including tenant
improvements, leasing commissions and free rent, may be substantial and could
reduce cash flow from a retail property.
The presence or absence of an anchor tenant in a multi-tenanted retail
property can be important. Anchor tenants play a key role in generating customer
traffic and making the center desirable for other tenants. An anchor tenant is,
in general, a retail tenant whose space is substantially larger in size than
that of other tenants at the same retail property and whose operation is vital
in attracting customers to the property. At some retail properties, the anchor
tenant owns the space it occupies. In those cases where the property owner does
not control the space occupied by the anchor tenant, the property owner may not
be able to take actions with respect to the space that it otherwise typically
would, such as granting concessions to retain an anchor tenant or removing an
ineffective anchor tenant. In some cases, an anchor tenant may cease to operate
at the property, thereby leaving its space unoccupied even though it continues
to own or pay rent on the vacant space. If an anchor tenant ceases operations at
a retail property, other tenants at the property may be entitled to terminate
their leases prior to the scheduled termination date or to pay rent at a reduced
rate for the remaining term of the lease.
Various factors will adversely affect the economic performance of an
anchored retail property, including:
- an anchor tenant's failure to renew its lease;
- termination of an anchor tenant's lease;
- the bankruptcy or economic decline of an anchor tenant or a self-owned
anchor;
- the cessation of the business of a self-owned anchor or of an anchor
tenant, notwithstanding its continued ownership of the previously
occupied space or its continued payment of rent, as the case may be; or
- a loss of an anchor tenant's ability to attract shoppers.
Retail properties may also face competition from sources outside a given
real estate market or with lower operating costs. For example, all of the
following compete with more traditional department stores and specialty shops
for consumer dollars:
- factory outlet centers;
- discount shopping centers and clubs;
- catalogue retailers;
- television shopping networks and programs;
- internet web sites; and
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- telemarketing.
Similarly, home movie rentals and pay-per-view movies provide alternate
sources of entertainment to movie theaters. Continued growth of these
alternative retail outlets and entertainment sources, which are often
characterized by lower operating costs, could adversely affect the rents
collectible at retail properties.
Gas stations, automotive sales and service centers and dry cleaners also
pose unique environmental risks because of the nature of their businesses and
the types of products used or sold in those businesses.
Office Properties. Factors affecting the value and operation of an office
property include:
- the number and quality of the tenants, particularly significant tenants,
at the property;
- the physical attributes of the building in relation to competing
buildings;
- the location of the property with respect to the central business
district or population centers;
- demographic trends within the metropolitan area to move away from or
towards the central business district;
- social trends combined with space management trends, which may change
towards options such as telecommuting or hoteling to satisfy space needs;
- tax incentives offered to businesses or property owners by cities or
suburbs adjacent to or near where the building is located;
- local competitive conditions, such as the supply of office space or the
existence or construction of new competitive office buildings;
- the quality and philosophy of building management;
- access to mass transportation; and
- changes in zoning laws.
Office properties may be adversely affected by an economic decline in the
business operated by their tenants. The risk associated with that economic
decline is increased if revenue is dependent on a single tenant or if there is a
significant concentration of tenants in a particular business or industry.
Office properties are also subject to competition with other office
properties in the same market. Competitive factors affecting an office property
include:
- rental rates;
- the building's age, condition and design, including floor sizes and
layout;
- access to public transportation and availability of parking; and
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- amenities offered to its tenants, including sophisticated building
systems, such as fiber optic cables, satellite communications or other
base building technological features.
The cost of refitting office space for a new tenant is often higher than
for other property types.
The success of an office property also depends on the local economy.
Factors influencing a company's decision to locate in a given area include:
- the cost and quality of labor;
- tax incentives; and
- quality of life matters, such as schools and cultural amenities.
The strength and stability of the local or regional economy will affect an
office property's ability to attract stable tenants on a consistent basis. A
central business district may have a substantially different economy from that
of a suburb.
Hospitality Properties. Hospitality properties may involve different
types of hotels and motels, including:
- full service hotels;
- resort hotels with many amenities;
- limited service hotels;
- hotels and motels associated with national or regional franchise chains;
- hotels that are not affiliated with any franchise chain but may have
their own brand identity; and
- other lodging facilities.
Factors affecting the economic performance of a hospitality property
include:
- the location of the property and its proximity to major population
centers or attractions;
- the seasonal nature of business at the property;
- the level of room rates relative to those charged by competitors;
- quality and perception of the franchise affiliation;
- economic conditions, either local, regional or national, which may limit
the amount that can be charged for a room and may result in a reduction
in occupancy levels;
- the existence or construction of competing hospitality properties;
- nature and quality of the services and facilities;
- financial strength and capabilities of the owner and operator;
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- the need for continuing expenditures for modernizing, refurbishing and
maintaining existing facilities;
- increases in operating costs, which may not be offset by increased room
rates;
- the property's dependence on business and commercial travelers and
tourism; and
- changes in travel patterns caused by changes in access, energy prices,
labor strikes, relocation of highways, the reconstruction of additional
highways or other factors.
Because limited service hotels and motels are relatively quick and
inexpensive to construct and may quickly reflect a positive value, an
over-building of these hotels and motels could occur in any given region, which
would likely adversely affect occupancy and daily room rates. Further, because
rooms at hospitality properties are generally rented for short periods of time,
hospitality properties tend to be more sensitive to adverse economic conditions
and competition than many other types of commercial properties. Additionally,
the revenues of some hospitality properties, particularly those located in
regions whose economies depend upon tourism, may be highly seasonal in nature.
Hospitality properties may be operated under franchise agreements. The
continuation of a franchise is typically subject to specified operating
standards and other terms and conditions. The franchisor periodically inspects
its licensed properties to confirm adherence to its operating standards. The
failure of the hospitality property to maintain those standards or adhere to
those other terms and conditions could result in the loss or cancellation of the
franchise license. It is possible that the franchisor could condition the
continuation of a franchise license on the completion of capital improvements or
the making of capital expenditures that the owner of the hospitality property
determines are too expensive or are otherwise unwarranted in light of the
operating results or prospects of the property. In that event, the owner of the
hospitality property may elect to allow the franchise license to lapse. In any
case, if the franchise is terminated, the owner of the hospitality property may
seek to obtain a suitable replacement franchise or to operate property
independently of a franchise license. The loss of a franchise license could have
a material adverse effect upon the operations or value of the hospitality
property because of the loss of associated name recognition, marketing support
and centralized reservation systems provided by the franchisor.
The viability of any hospitality property that is a franchise of a national
or a regional hotel or motel chain is dependent upon:
- the continued existence and financial strength of the franchisor;
- the public perception of the franchise service mark; and
- the duration of the franchise licensing agreement.
The transferability of franchise license agreements may be restricted. The
consent of the franchisor would be required for the continued use of the
franchise license by the hospitality property following a foreclosure.
Conversely, a lender may be unable to
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remove a franchisor that it desires to replace following a foreclosure. Further,
in the event of a foreclosure on a hospitality property, the lender or other
purchaser of the hospitality property may not be entitled to the rights under
any associated liquor license. That party would be required to apply in its own
right for a new liquor license. There can be no assurance that a new license
could be obtained or that it could be obtained promptly.
Casino Properties. Factors affecting the economic performance of a casino
property include:
- location, including proximity to or easy access from major population
centers;
- appearance;
- economic conditions, either local, regional or national, which may limit
the amount of disposable income that potential patrons may have for
gambling;
- the existence or construction of competing casinos;
- dependence on tourism; and
- local or state governmental regulation.
Competition among major casinos may involve attracting patrons by--
- providing alternate forms of entertainment, such as performers and
sporting events, and
- offering low-priced or free food and lodging.
Casino owners may expend substantial sums to modernize, refurbish and
maintain existing facilities.
Because of their dependence on disposable income of patrons, casino
properties are likely to respond quickly to a downturn in the economy.
To avoid criminal influence, the ownership and operation of casino
properties is often subject to local or state governmental regulation. A
government agency or authority may have jurisdiction over or influence with
respect to the foreclosure of a casino property or the bankruptcy of its owner
or operator. In some jurisdictions, it may be necessary to receive governmental
approval before foreclosing, thereby resulting in substantial delays to a
lender. Gaming licenses are not transferable, including in connection with a
foreclosure. There can be no assurance that a lender or another purchaser in
foreclosure or otherwise will be able to obtain the requisite approvals to
continue operating the foreclosed property as a casino.
Any given state or municipality that currently allows legalized gambling
could pass legislation banning it.
The loss of a gaming license for any reason would have a material adverse
effect on the value of a casino property.
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Health Care-Related Properties. Health-care related properties include
- hospitals;
- skilled nursing facilities;
- nursing homes;
- congregate care facilities; and
- in some cases, assisted living centers and housing for seniors.
Health care-related facilities, particularly nursing homes, may receive a
substantial portion of their revenues from government reimbursement programs,
primarily Medicaid and Medicare. Medicaid and Medicare are subject to
- statutory and regulatory changes;
- retroactive rate adjustments;
- administrative rulings;
- policy interpretations;
- delays by fiscal intermediaries; and
- government funding restrictions.
All of the foregoing can adversely affect revenues from the operation a health
care-related facility. Moreover, governmental payors have employed
cost-containment measures that limit payments to health care providers. In
addition, there are currently under consideration various proposals for national
health care relief that could further limit these payments.
Providers of long-term nursing care and other medical services are highly
regulated by federal, state and local law. They are subject to numerous factors
which can increase the cost of operation, limit growth and, in extreme cases,
require or result in suspension or cessation of operations, including:
- federal and state licensing requirements;
- facility inspections;
- rate setting;
- reimbursement policies; and
- laws relating to the adequacy of medical care, distribution of
pharmaceuticals, use of equipment, personnel operating policies and
maintenance of and additions to facilities and services.
Under applicable federal and state laws and regulations, Medicare and
Medicaid reimbursements generally may not be made to any person other than the
provider who actually furnished the related material goods and services.
Accordingly, in the event of foreclosure on a health care-related facility,
neither a lender nor other subsequent lessee or operator of the property would
generally be entitled to obtain from federal or state
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governments any outstanding reimbursement payments relating to services
furnished at the property prior to foreclosure. Furthermore, in the event of
foreclosure, there can be no assurance that a lender or other purchaser in a
foreclosure sale would be entitled to the rights under any required licenses and
regulatory approvals. The lender or other purchaser may have to apply in its own
right for those licenses and approvals. There can be no assurance that a new
license could be obtained or that a new approval would be granted.
Health care-related facilities are generally special purpose properties
that could not be readily converted to general residential, retail or office
use. This will adversely affect their liquidation value. Furthermore, transfers
of health care-related facilities are subject to regulatory approvals under
state, and in some cases federal, law not required for transfers of most other
types of commercial properties.
Industrial Properties. Industrial properties may be adversely affected by
reduced demand for industrial space occasioned by a decline in a particular
industry segment and/or by a general slowdown in the economy. In addition, an
industrial property that suited the particular needs of its original tenant may
be difficult to relet to another tenant or may become functionally obsolete
relative to newer properties.
The value and operation of an industrial property depends on:
- location of the property, the desirability of which in a particular
instance may depend on--
1. availability of labor services,
2. proximity to supply sources and customers, and
3. accessibility to various modes of transportation and shipping,
including railways, roadways, airline terminals and ports;
- building design of the property, the desirability of which in a
particular instance may depend on--
1. ceiling heights,
2. column spacing,
3. number and depth of loading bays,
4. divisibility,
5. floor loading capacities,
6. truck turning radius,
7. overall functionality, and
8. adaptability of the property, because industrial tenants often need
space that is acceptable for highly specialized activities; and
- the quality and creditworthiness of individual tenants, because
industrial properties frequently have higher tenant concentrations.
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Industrial properties are generally special purpose properties that could
not be readily converted to general residential, retail or office use. This will
adversely affect their liquidation value.
Warehouse, Mini-Warehouse and Self-Storage Facilities. Warehouse,
mini-warehouse and self-storage properties are considered vulnerable to
competition because both acquisition costs and break-even occupancy are
relatively low. In addition, it would require substantial capital expenditures
to convert a warehouse, mini-warehouse or self-storage property to an
alternative use. This will materially impair the liquidation value of the
property if its operation for storage purposes becomes unprofitable due to
decreased demand, competition, age of improvements or other factors.
Successful operation of a warehouse, mini-warehouse or self-store property
depends on--
- building design;
- location and visibility;
- tenant privacy;
- efficient access to the property;
- proximity to potential users, including apartment complexes or commercial
users;
- services provided at the property, such as security;
- age and appearance of the improvements; and
- quality of management.
Restaurants and Taverns. Factors affecting the economic viability of
individual restaurants, taverns and other establishments that are part of the
food and beverage service industry include:
- competition from facilities having businesses similar to a particular
restaurant or tavern;
- perceptions by prospective customers of safety, convenience, services and
attractiveness;
- the cost, quality and availability of food and beverage products;
- negative publicity, resulting from instances of food contamination,
food-borne illness and similar events;
- changes in demographics, consumer habits and traffic patterns;
- the ability to provide or contract for capable management; and
- retroactive changes to building codes, similar ordinances and other legal
requirements.
Adverse economic conditions, whether local, regional or national, may limit
the amount that may be charged for food and beverages and the extent to which
potential customers dine out. Because of the nature of the business, restaurants
and taverns tend
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to respond to adverse economic conditions more quickly than do many other types
of commercial properties. Furthermore, the transferability of any operating,
liquor and other licenses to an entity acquiring a bar or restaurant, either
through purchase or foreclosure, is subject to local law requirements.
The food and beverage service industry is highly competitive. The principal
means of competition are--
- segment,
- product,
- price,
- value,
- quality,
- service,
- convenience,
- location, and
- the nature and condition of the restaurant facility.
A restaurant or tavern operator competes with the operators of comparable
establishments in the area in which its restaurant or tavern is located. Other
restaurants could have--
- lower operating costs,
- more favorable locations,
- more effective marketing,
- more efficient operations, or
- better facilities.
The location and condition of a particular restaurant or tavern will affect
the number of customers and, to an extent, the prices that may be charged. The
characteristics of an area or neighborhood in which a restaurant or tavern is
located may change over time or in relation to competing facilities. Also, the
cleanliness and maintenance at a restaurant or tavern will affect its appeal to
customers. In the case of a regionally- or nationally-known chain restaurant,
there may be costly expenditures for renovation, refurbishment or expansion,
regardless of its condition.
Factors affecting the success of a regionally- or nationally-known chain
restaurant include:
- actions and omissions of any franchisor, including management practices
that--
1. adversely affect the nature of the business, or
2. require renovation, refurbishment, expansion or other expenditures;
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- the degree of support provided or arranged by the franchisor, including
its franchisee organizations and third-party providers of products or
services; and
- the bankruptcy or business discontinuation of the franchisor or any of
its franchisee organizations or third-party providers.
Chain restaurants may be operated under franchise agreements. Those
agreements typically do not contain provisions protective of lenders. A
borrower's rights as franchisee typically may be terminated without informing
the lender, and the borrower may be precluded from competing with the franchisor
upon termination. In addition, a lender that acquires title to a restaurant site
through foreclosure or similar proceedings may be restricted in the use of the
site or may be unable to succeed to the rights of the franchisee under the
related franchise agreement. The transferability of a franchise may be subject
to other restrictions. Also, federal and state franchise regulations may impose
additional risk, including the risk that the transfer of a franchise acquired
through foreclosure or similar proceedings may require registration with
governmental authorities or disclosure to prospective transferees.
Manufactured Housing Communities, Mobile Home Parks and Recreational
Vehicle Parks. Manufactured housing communities and mobile home parks consist
of land that is divided into "spaces" or "home sites" that are primarily leased
to owners of the individual mobile homes or other housing units. The home owner
often invests in site-specific improvements such as carports, steps, fencing,
skirts around the base of the home, and landscaping. The land owner typically
provides private roads within the park, common facilities and, in many cases,
utilities. Due to relocation costs and, in some cases, demand for homesites, the
value of a mobile home or other housing unit in place in a manufactured housing
community or mobile home park is generally higher, and can be significantly
higher, than the value of the same unit not placed in a manufactured housing
community or mobile home park. As a result, a well-operated manufactured housing
community or mobile home park that has achieved stabilized occupancy is
typically able to maintain occupancy at or near that level. For the same reason,
a lender that provided financing for the home of a tenant who defaulted in his
or her space rent generally has an incentive to keep rental payments current
until the home can be resold in place, rather than to allow the unit to be
removed from the park. In general, the individual mobile homes and other housing
units will not constitute collateral for a mortgage loan underlying a series of
offered certificates.
Recreational vehicle parks lease spaces primarily or exclusively for motor
homes, travel trailers and portable truck campers, primarily designed for
recreational, camping or travel use. In general, parks that lease recreational
vehicle spaces can be viewed as having a less stable tenant population than
parks occupied predominantly by mobile homes. However, it is not unusual for the
owner of a recreational vehicle to leave the vehicle at the park on a year-round
basis or to use the vehicle as low cost housing and reside in the park
indefinitely.
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Factors affecting the successful operation of a manufactured housing
community, mobile home park or recreational vehicle park include:
- the number of comparable competing properties in the local market;
- the age, appearance and reputation of the property;
- the quality of management; and
- the types of facilities and services it provides.
Manufactured housing communities and mobile home parks also compete against
alternative forms of residential housing, including--
- multifamily rental properties,
- cooperatively-owned apartment buildings,
- condominium complexes, and
- single-family residential developments.
Recreational vehicle parks also compete against alternative forms of
recreation and short-term lodging, such as staying at a hotel at the beach.
Manufactured housing communities, mobile home parks and recreational
vehicle parks are special purpose properties that could not be readily converted
to general residential, retail or office use. This will adversely affect the
liquidation value of the property if its operation as a manufactured housing
community, mobile home park or recreational vehicle park, as the case may be,
becomes unprofitable due to competition, age of the improvements or other
factors.
Some states regulate the relationship of an owner of a manufactured housing
community or mobile home park and its tenants in a manner similar to the way
they regulate the relationship between a landlord and tenant at a multifamily
rental property. In addition, some states also regulate changes in the use of a
manufactured housing community or mobile home park and require that the owner
give written notice to its tenants a substantial period of time prior to the
projected change.
In addition to state regulation of the landlord-tenant relationship,
numerous counties and municipalities impose rent control on manufactured housing
communities and mobile home parks. These ordinances may limit rent increases to:
- fixed percentages,
- percentages of increases in the consumer price index,
- increases set or approved by a governmental agency, or
- increases determined through mediation or binding arbitration.
In many cases, the rent control laws either do not permit vacancy decontrol
or permit vacancy decontrol only in the relatively rare event that the mobile
home or manufactured housing unit is removed from the homesite. Local authority
to impose rent control on manufactured housing communities and mobile home parks
is pre-empted by
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state law in some states and rent control is not imposed at the state level in
those states. In some states, however, local rent control ordinances are not
pre-empted for tenants having short-term or month-to-month leases, and
properties there may be subject to various forms of rent control with respect to
those tenants.
Recreational and Resort Properties. Any mortgage loan underlying a series
of offered certificates may be secured by a golf course, marina, ski resort,
amusement park or other property used for recreational purposes or as a resort.
Factors affecting the economic performance of a property of this type include:
- the location and appearance of the property;
- the appeal of the recreational activities offered;
- the existence or construction of competing properties, whether are not
they offer the same activities;
- the need to make capital expenditures to maintain, refurbish, improve
and/or expand facilities in order to attract potential patrons;
- geographic location and dependence on tourism;
- changes in travel patterns caused by changes in energy prices, strikes,
location of highways, construction of additional highways and similar
factors;
- seasonality of the business, which may cause periodic fluctuations in
operating revenues and expenses;
- sensitivity to weather and climate changes; and
- local, regional and national economic conditions.
A marina or other recreational or resort property located next to water
will also be affected by various statutes and government regulations that govern
the use of, and construction on, rivers, lakes and other waterways.
Because of the nature of the business, recreational and resort properties
tend to respond to adverse economic conditions more quickly than do many other
types of commercial properties.
Recreational and resort properties are generally special purpose properties
that are not readily convertible to alternative uses. This will adversely affect
their liquidation value.
Arenas and Stadiums. The success of an arena or stadium generally depends
on its ability to attract patrons to a variety of events, including:
- sporting events;
- musical events;
- theatrical events;
- animal shows; and/or
- circuses.
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The ability to attract patrons is dependent on, among others, the following
factors:
- the appeal of the particular event;
- the cost of admission;
- perceptions by prospective patrons of the safety, convenience, services
and attractiveness of the arena or stadium;
- perceptions by prospective patrons of the safety of the surrounding area;
and
- the alternative forms of entertainment available in the particular
locale.
In some cases, an arena's or stadium's success will depend on its ability
to attract and keep a sporting team as a tenant. An arena or stadium may become
unprofitable, or unacceptable to a tenant of that type, due to decreased
attendance, competition and age of improvements. Often, substantial expenditures
must be made to modernize, refurbish and/or maintain existing facilities.
Arenas and stadiums are special purpose properties which cannot be readily
convertible to alternative uses. This will adversely affect their liquidation
value.
Churches and Other Religious Facilities. Churches and other religious
facilities generally depend on charitable donations to meet expenses and pay for
maintenance and capital expenditures. The extent of those donations is dependent
on the attendance at any particular religious facility and the extent to which
attendees are prepared to make donations, which is influenced by a variety of
social, political and economic factors. Donations may be adversely affected by
economic conditions, whether local, regional or national. Religious facilities
are special purpose properties that are not readily convertible to alternative
uses. This will adversely affect their liquidation value.
Parking Lots and Garages. The primary source of income for parking lots
and garages is the rental fees charged for parking spaces. Factors affecting the
success of a parking lot or garage include:
- the number of rentable parking spaces and rates charged;
- the location of the lot or garage and, in particular, its proximity to
places where large numbers of people work, shop or live;
- the amount of alternative parking spaces in the area;
- the availability of mass transit; and
- the perceptions of the safety, convenience and services of the lot or
garage.
Unimproved Land. The value of unimproved land is largely a function of
its potential use. This may depend on--
- its location,
- its size,
- the surrounding neighborhood, and
- local zoning laws.
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Default and Loss Considerations with Respect to Commercial and Multifamily
Mortgage Loans. Mortgage loans secured by liens on income-producing properties
are substantially different from mortgage loans made on the security of
owner-occupied single-family homes. The repayment of a loan secured by a lien on
an income-producing property is typically dependent upon--
- the successful operation of the property, and
- its ability to generate income sufficient to make payments on the loan.
This is particularly true because most or all of the mortgage loans underlying
the offered certificates will be nonrecourse loans.
The debt service coverage ratio of a multifamily or commercial mortgage
loan is an important measure of the likelihood of default on the loan. In
general, the debt service coverage ratio of a multifamily or commercial mortgage
loan at any given time is the ratio of--
- the amount of income derived or expected to be derived from the related
real property for a twelve-month period that is available to pay debt
service, to
- the annualized scheduled payments of principal and/or interest on the
mortgage loan and any other senior loans that are secured by the related
real property.
The amount described in the first bullet point of the preceding sentence is
often a highly subjective number based on a variety of assumptions regarding,
and adjustments to, revenues and expenses with respect to the related real
property. We will provide a more detailed discussion of its calculation in the
related prospectus supplement.
The cash flow generated by a multifamily or commercial property will
generally fluctuate over time and may or may not be sufficient to make--
- the loan payments on the related mortgage loan,
- cover operating expenses, and
- fund capital improvements at any given time.
Operating revenues of a nonowner occupied, income-producing property may be
affected by the condition of the applicable real estate market and/or area
economy. Properties leased, occupied or used on a short-term basis, such as--
- some health care-related facilities,
- hotels and motels,
- recreational vehicle parks, and
- mini-warehouse and self-storage facilities,
tend to be affected more rapidly by changes in market or business conditions
than do properties typically leased for longer periods, such as--
- warehouses,
- retail stores,
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- office buildings, and
- industrial facilities.
Some commercial properties may be owner-occupied or leased to a small
number of tenants. Accordingly, the operating revenues may depend substantially
on the financial condition of the borrower or one or a few tenants. Mortgage
loans secured by liens on owner-occupied and single tenant properties may pose a
greater likelihood of default and loss than loans secured by liens on
multifamily properties or on multi-tenant commercial properties.
Increases in property operating expenses can increase the likelihood of a
borrower default on a multifamily or commercial mortgage loan secured by the
property. Increases in property operating expenses may result from:
- increases in energy costs and labor costs;
- increases in interest rates and real estate tax rates; and
- changes in governmental rules, regulations and fiscal policies.
Some net leases of commercial properties may provide that the lessee,
rather than the borrower/landlord, is responsible for payment of operating
expenses. However, a net lease will result in stable net operating income to the
borrower/landlord only if the lessee is able to pay the increased operating
expense while also continuing to make rent payments.
Lenders also look to the loan-to-value ratio of a mortgage loan as a factor
in evaluating the likelihood of loss if a property is liquidated following a
default. In general, the loan-to-value ratio of a multifamily or commercial
mortgage loan at any given time is the ratio, expressed as a percentage, of--
- the then outstanding principal balance of the mortgage loan and any other
senior loans that are secured by the related real property, to
- the estimated value of the related real property based on an appraisal, a
cash flow analysis, a recent sales price or another method or benchmark
of valuation.
A low loan-to-value ratio means the borrower has a large amount of its own
equity in the multifamily or commercial property that secures its loan. In these
circumstances--
- the borrower has a greater incentive to perform under the terms of the
related mortgage loan in order to protect that equity, and
- the lender has greater protection against loss on liquidation following a
borrower default.
Loan-to-value ratios are not necessarily an accurate measure of the
likelihood of liquidation loss in a pool of multifamily and commercial mortgage
loans. For example, the value of a multifamily or commercial property as of the
date of initial issuance of a series of offered certificates may be less than
the estimated value determined at loan origination. The value of any real
property, in particular a multifamily or commercial property, will likely
fluctuate from time to time. Moreover, even a current appraisal is
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not necessarily a reliable estimate of value. Appraised values of
income-producing properties are generally based on--
- the market comparison method, which takes into account the recent resale
value of comparable properties at the date of the appraisal;
- the cost replacement method, which takes into account the cost of
replacing the property at the date of the appraisal;
- the income capitalization method, which takes into account the property's
projected net cash flow; or
- a selection from the values derived from the foregoing methods.
Each of these appraisal methods presents analytical difficulties. For
example,
- it is often difficult to find truly comparable properties that have
recently been sold;
- the replacement cost of a property may have little to do with its current
market value; and
- income capitalization is inherently based on inexact projections of
income and expense and the selection of an appropriate capitalization
rate and discount rate.
If more than one appraisal method is used and significantly different
results are produced, an accurate determination of value and, correspondingly, a
reliable analysis of the likelihood of default and loss, is even more difficult.
The value of a multifamily or commercial property will be affected by
property performance. As a result, if a multifamily or commercial mortgage loan
defaults because the income generated by the related property is insufficient to
pay operating costs and expenses as well as debt service, then the value of the
property will decline and a liquidation loss may occur.
We believe that the foregoing considerations are important factors that
generally distinguish mortgage loans secured by liens on income-producing real
estate from single-family mortgage loans. However, the originators of the
mortgage loans underlying your offered certificates may not have considered all
of those factors for all or any of those loans.
See "Risk Factors--Repayment of a Commercial or Multifamily Mortgage Loan
Depends Upon the Performance and Value of the Underlying Real Property, Which
May Decline Over Time, and the Related Borrower's Ability to Refinance the
Property, of Which There is no Assurance."
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Payment Provisions of the Mortgage Loans. Each of the mortgage loans
included in one of our trusts will have the following features:
- an original term to maturity of not more than approximately 40 years; and
- scheduled payments of principal, interest or both, to be made on
specified dates, that occur monthly, bi-monthly, quarterly,
semi-annually, annually or at some other interval.
A mortgage loan included in one of our trusts may also include terms that:
- provide for the accrual of interest at a mortgage interest rate that is
fixed over its term, that resets on one or more specified dates or that
otherwise adjusts from time to time;
- provide for the accrual of interest at a mortgage interest rate that may
be converted at the borrower's election from an adjustable to a fixed
interest rate or from a fixed to an adjustable interest rate;
- provide for no accrual of interest;
- provide for level payments to stated maturity, for payments that reset in
amount on one or more specified dates or for payments that otherwise
adjust from time to time to accommodate changes in the coupon rate or to
reflect the occurrence of specified events;
- be fully amortizing or, alternatively, may be partially amortizing or
nonamortizing, with a substantial payment of principal due on its stated
maturity date;
- permit the negative amortization or deferral of accrued interest;
- permit defeasance and the release of the real property collateral in
connection with that defeasance; and/or
- prohibit some or all voluntary prepayments or require payment of a
premium, fee or charge in connection with those prepayments.
Mortgage Loan Information in Prospectus Supplements. We will describe in
the related prospectus supplement the characteristics of the mortgage loans that
we will include in any of our trusts. In general, we will provide in the related
prospectus supplement, among other items, the following information on the
particular mortgage loans in one of our trusts:
- the total outstanding principal balance and the largest, smallest and
average outstanding principal balance of the mortgage loans;
- the type or types of property that provide security for repayment of the
mortgage loans;
- the earliest and latest origination date and maturity date of the
mortgage loans;
- the original and remaining terms to maturity of the mortgage loans, or
the range of each of those terms to maturity, and the weighted average
original and remaining terms to maturity of the mortgage loans;
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- loan-to-value ratios of the mortgage loans either at origination or as of
a more recent date, or the range of those loan-to-value ratios, and the
weighted average of those loan-to-value ratios;
- the mortgage interest rates of the mortgage loans, or the range of those
mortgage interest rates, and the weighted average mortgage interest rate
of the mortgage loans;
- if any mortgage loans have adjustable mortgage interest rates, the index
or indices upon which the adjustments are based, the adjustment dates,
the range of gross margins and the weighted average gross margin, and any
limits on mortgage interest rate adjustments at the time of any
adjustment and over the life of the loan;
- information on the payment characteristics of the mortgage loans,
including applicable prepayment restrictions;
- debt service coverage ratios of the mortgage loans either at origination
or as of a more recent date, or the range of those debt service coverage
ratios, and the weighted average of those debt service coverage ratios;
and
- the geographic distribution of the properties securing the mortgage loans
on a state-by-state basis.
If we are unable to provide the specific information described above at the
time a series of offered certificates is initially offered, we will provide--
- more general information in the related prospectus supplement, and
- specific information in a report which will be filed with the SEC as part
of a Current Report on Form 8-K within 15 days following the issuance of
those certificates.
If any mortgage loan, or group of related mortgage loans, included in one
of our trusts represents a material concentration of credit risk, we will
include in the related prospectus supplement financial statements or other
financial information on the related real property or properties.
MORTGAGE-BACKED SECURITIES
The mortgage backed-securities underlying a series of offered certificates
may include:
- mortgage participations, mortgage pass-through certificates,
collateralized mortgage obligations or other mortgage-backed securities
that are not insured or guaranteed by any governmental agency or
instrumentality, or
- certificates issued and/or insured or guaranteed by Freddie Mac, Fannie
Mae, Ginnie Mae, Farmer Mac, or another federal or state governmental
agency or instrumentality.
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In addition, each of those mortgage-backed securities will directly or
indirectly evidence an interest in, or be secured by a pledge of, multifamily
and/or commercial mortgage loans.
Each mortgage-backed security included in one of our trusts--
- will have been registered under the Securities Act of 1933, as amended,
or
- will be exempt from the registration requirements of that Act, or
- will have been held for at least the holding period specified in Rule
144(k) under that Act, or
- may otherwise be resold by us publicly without registration under that
Act.
We will describe in the related prospectus supplement the characteristics
of the mortgage-backed securities that we will include in any of our trusts. In
general, we will provide in the related prospectus supplement, among other
items, the following information on the particular mortgage-backed securities
included in one of our trusts:
- the initial and outstanding principal amount(s) and type of the
securities;
- the original and remaining term(s) to stated maturity of the securities;
- the pass-through or bond rate(s) of the securities or the formula for
determining those rate(s);
- the payment characteristics of the securities;
- the identity of the issuer(s), servicer(s) and trustee(s) for the
securities;
- a description of the related credit support, if any;
- the type of mortgage loans underlying the securities;
- the circumstances under which the related underlying mortgage loans, or
the securities themselves, may be purchased prior to maturity;
- the terms and conditions for substituting mortgage loans backing the
securities; and
- the characteristics of any agreements or instruments providing interest
rate protection to the securities.
With respect to any mortgage-backed security included in one of our trusts,
we will provide in our reports filed under the Securities Exchange Act of 1934,
as amended, the same information regarding the security as is provided by the
issuer of the security in its own reports filed under that Act, if the security
was publicly offered, or in the reports the issuer of the security provides to
the related trustee, if the security was privately issued.
SUBSTITUTION, ACQUISITION AND REMOVAL OF MORTGAGE ASSETS
If so specified in the related prospectus supplement, we or another
specified person or entity may be permitted, at our or its option, but subject
to the conditions specified in
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that prospectus supplement, to acquire from the related trust particular
mortgage assets underlying a series of offered certificates in exchange for:
- cash that would be applied to pay down the principal balances of the
certificates of that series; and/or
- other mortgage loans or mortgage-backed securities that--
1. conform to the description of mortgage assets in this prospectus,
and
2. satisfy the criteria set forth in the related prospectus supplement.
In addition, if so specified in the related prospectus supplement, the
trustee may be authorized or required to apply collections on the related
mortgage assets to acquire new mortgage loans or mortgage-backed securities
that--
- conform to the description of mortgage assets in this prospectus, and
- satisfy the criteria set forth in the related prospectus supplement.
No replacement of mortgage assets or acquisition of new mortgage assets
will be permitted if it would result in a qualification, downgrade or withdrawal
of the then-current rating assigned by any rating agency to any class of
affected offered certificates.
UNDELIVERED MORTGAGE ASSETS
In general, the total outstanding principal balance of the mortgage assets
transferred by us to any particular trust will equal or exceed the initial total
outstanding principal balance of the related series of certificates. In the
event that the total outstanding principal balance of the related mortgage
assets initially delivered by us to the related trustee is less than the initial
total outstanding principal balance of any series of certificates, we may
deposit or arrange for the deposit of cash or liquid investments on an interim
basis with the related trustee to cover the shortfall. For 90 days following the
date of initial issuance of that series of certificates, we will be entitled to
obtain a release of the deposited cash or investments if we deliver or arrange
for delivery of a corresponding amount of mortgage assets. If we fail, however,
to deliver mortgage assets sufficient to make up the entire shortfall, any of
the cash or, following liquidation, investments remaining on deposit with the
related trustee will be used by the related trustee to pay down the total
principal balance of the related series of certificates, as described in the
related prospectus supplement.
ACCOUNTS
The trust assets underlying a series of offered certificates will include
one or more accounts established and maintained on behalf of the holders. All
payments and collections received or advanced on the mortgage assets and other
trust assets will be deposited and held in those accounts. We will identify and
describe those accounts, and will further describe the deposits to and
withdrawals from those accounts, in the related prospectus supplement.
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CREDIT SUPPORT
General. The holders of any class of offered certificates may be the
beneficiaries of credit support designed to protect them partially or fully
against all or particular defaults and losses on the related mortgage assets.
The types of credit support that may benefit the holders of a class of offered
certificates include:
- the subordination or one or more other classes of certificates of the
same series;
- a letter of credit;
- a surety bond;
- an insurance policy;
- a guarantee;
- a credit derivative; and/or
- a reserve fund.
In the related prospectus supplement, we will describe the amount and types
of any credit support benefiting the holders of a class of offered certificates.
ARRANGEMENTS PROVIDING REINVESTMENT, INTEREST RATE AND CURRENCY RELATED
PROTECTION
The trust assets for a series of offered certificates may include
guaranteed investment contracts in accordance with which moneys held in the
funds and accounts established for that series will be invested at a specified
rate. Those trust assets may also include:
- interest rate exchange agreements;
- interest rate cap agreements;
- interest rate floor agreements;
- currency exchange agreements; or
- other agreements or arrangements designed to reduce the effects of
interest rate or currency exchange rate fluctuations with respect to the
related mortgage assets and one or more classes of offered certificates.
In the related prospectus supplement, we will describe any agreements or
other arrangements designed to protect the holders of a class of offered
certificates against shortfalls resulting from movements or fluctuations in
interest rates or currency exchange rates. If applicable, we will also identify
any obligor under the agreement or other arrangement.
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YIELD AND MATURITY CONSIDERATIONS
GENERAL
The yield on your offered certificates will depend on--
- the price you paid for your offered certificates,
- the pass-through rate on your offered certificates,
- the amount and timing of payments on your offered certificates.
The following discussion contemplates a trust established by us that
consists only of mortgage loans. If one of our trusts also includes a
mortgage-backed security, the payment terms of that security will soften or
enhance the effects that the characteristics and behavior of mortgage loans
backing that security can have on the yield to maturity and/or weighted average
life of a class of offered certificates. If one of our trusts includes a
mortgage-backed security, we will discuss in the related prospectus supplement
the effect, if any, that the security may have on the yield to maturity and
weighted average lives of the related offered certificates.
PASS-THROUGH RATE
A class of interest-bearing offered certificates may have a fixed, variable
or adjustable pass-through rate. We will specify in the related prospectus
supplement the pass-through rate for each class of interest-bearing offered
certificates or, if the pass-through rate is variable or adjustable, the method
of determining the pass-through rate.
PAYMENT DELAYS
There will be a delay between the date on which payments on the underlying
mortgage loans are due and the date on which those payments are passed through
to you and other investors. That delay will reduce the yield that would
otherwise be produced if those payments were passed through on your offered
certificates on the same date that they were due.
YIELD AND PREPAYMENT CONSIDERATIONS
The yield to maturity on your offered certificates will be affected by the
rate of principal payments on the underlying mortgage loans and the allocation
of those principal payments to reduce the principal balance or notional amount
of your offered certificates. The rate of principal payments on those mortgage
loans will be affected by the following:
- the amortization schedules of the mortgage loans, which may change from
time to time to reflect, among other things, changes in mortgage interest
rates or partial prepayments of principal;
- the dates on which any balloon payments are due; and
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the rate of principal prepayments on the mortgage loans, including voluntary
prepayments by borrowers and involuntary prepayments resulting from
liquidations, casualties or purchases of mortgage loans.
Because the rate of principal prepayments on the mortgage loans underlying
your offered certificates will depend on future events and a variety of factors,
we cannot give you any assurance as to that rate.
The extent to which the yield to maturity of your offered certificates may
vary from your anticipated yield will depend upon--
- whether you purchased your offered certificates at a discount or premium
and, if so, the extent of that discount or premium, and
- when, and to what degree, payments of principal on the underlying
mortgage loans are applied or otherwise result in the reduction of the
principal balance or notional amount of your offered certificates.
If you purchase your offered certificates at a discount, you should
consider the risk that a slower than anticipated rate of principal payments on
the underlying mortgage loans could result in an actual yield to you that is
lower than your anticipated yield. If you purchase your offered certificates at
a premium, you should consider the risk that a faster than anticipated rate of
principal payments on the underlying mortgage loans could result in an actual
yield to you that is lower than your anticipated yield.
If your offered certificates entitle you to payments of interest, with
disproportionate, nominal or no payments of principal, you should consider that
your yield will be extremely sensitive to prepayments on the underlying mortgage
loans and, under some prepayment scenarios, may be negative.
If a class of offered certificates accrues interest on a notional amount,
that notional amount will, in general, either--
- be based on the principal balances of some or all of the mortgage assets
in the related trust, or
- equal the total principal balance of one or more of the other classes of
certificates of the same series.
Accordingly, the yield on that class of certificates will be inversely related
to, as applicable, the rate at which--
- payments and other collections of principal are received on the mortgage
assets referred to in the first bullet point of the prior sentence, or
- payments are made in reduction of the total principal balance of the
class or classes of certificates referred to in the second bullet point
of the prior sentence.
The extent of prepayments of principal of the mortgage loans underlying
your offered certificates may be affected by a number of factors, including:
- the availability of mortgage credit;
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- the relative economic vitality of the area in which the related real
properties are located;
- the quality of management of the related real properties;
- the servicing of the mortgage loans;
- possible changes in tax laws; and
- other opportunities for investment.
In general, those factors that increase--
- the attractiveness of selling or refinancing a commercial or multifamily
property, or
- the likelihood of default under a commercial or multifamily mortgage
loan,
would be expected to cause the rate of prepayment to accelerate. In contrast,
those factors having an opposite effect would be expected to cause the rate of
prepayment to slow.
The rate of principal payments on the mortgage loans underlying your
offered certificates may also be affected by the existence and enforceability of
prepayment restrictions, such as--
- prepayment lock-out periods, and
- requirements that voluntary principal prepayments be accompanied by
prepayment premiums, fees or charges.
If enforceable, those provisions could constitute either an absolute
prohibition, in the case of a prepayment lock-out period, or a disincentive, in
the case of a prepayment premium, fee or charge, to a borrower's voluntarily
prepaying its mortgage loan, thereby slowing the rate of prepayments.
The rate of prepayment on a pool of mortgage loans is likely to be affected
by prevailing market interest rates for mortgage loans of a comparable type,
term and risk level. As prevailing market interest rates decline, a borrower may
have an increased incentive to refinance its mortgage loan. Even in the case of
adjustable rate mortgage loans, as prevailing market interest rates decline, the
related borrowers may have an increased incentive to refinance for the following
purposes:
- to convert to a fixed rate loan and thereby lock in that rate, or
- to take advantage of a different index, margin or rate cap or floor on
another adjustable rate mortgage loan.
Subject to prevailing market interest rates and economic conditions
generally, a borrower may sell a real property in order to--
- realize its equity in the property,
- meet cash flow needs or
- make other investments.
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Additionally, some borrowers may be motivated by federal and state tax
laws, which are subject to change, to sell their properties prior to the
exhaustion of tax depreciation benefits.
We make no representation as to--
- the particular factors that will affect the prepayment of the mortgage
loans underlying any series of offered certificates,
- the relative importance of those factors
- the percentage of the principal balance of those mortgage loans that will
be paid as of any date, or
- the overall rate of prepayment on those mortgage loans.
WEIGHTED AVERAGE LIFE AND MATURITY
The rate at which principal payments are received on the mortgage loans
underlying any series of offered certificates will affect the ultimate maturity
and the weighted average life of one or more classes of those certificates. In
general, weighted average life refers to the average amount of time that will
elapse from the date of issuance of an instrument until each dollar allocable as
principal of that instrument is repaid to the investor.
The weighted average life and maturity of a class of offered certificates
will be influenced by the rate at which principal on the underlying mortgage
loans is paid to that class, whether in the form of--
- scheduled amortization or
- prepayments, including--
1. voluntary prepayments by borrowers, and
2. involuntary prepayments resulting from liquidations, casualties or
condemnations and purchases of mortgage loans out of the related
trust.
Prepayment rates on loans are commonly measured relative to a prepayment
standard or model, such as the CPR prepayment model or the SPA prepayment model.
CPR represents an assumed constant rate of prepayment each month, expressed as
an annual percentage, relative to the then outstanding principal balance of a
pool of mortgage loans for the life of those loans. SPA represents an assumed
variable rate of prepayment each month, expressed as an annual percentage,
relative to the then outstanding principal balance of a pool of mortgage loans,
with different prepayment assumptions often expressed as percentages of SPA. For
example, a prepayment assumption of 100% of SPA assumes prepayment rates of 0.2%
per annum of the then outstanding principal balance of those loans in the first
month of the life of the loans and an additional 0.2% per annum in each month
thereafter until the 30th month. Beginning in the 30th month, and in each month
thereafter during the life of the loans, 100% of SPA assumes a constant
prepayment rate of 6% per annum each month.
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Neither CPR nor SPA nor any other prepayment model or assumption is a
historical description of prepayment experience or a prediction of the
anticipated rate of prepayment of any particular pool of mortgage loans.
Moreover, the CPR and SPA models were developed based upon historical prepayment
experience for single-family mortgage loans. It is unlikely that the prepayment
experience of the mortgage loans underlying your offered certificates will
conform to any particular level of CPR or SPA.
In the prospectus supplement for a series of offered certificates, we will
include tables, if applicable, setting forth--
- the projected weighted average life of each class of those offered
certificates with principal balances, and
- the percentage of the initial total principal balance of each class of
those offered certificates that would be outstanding on specified dates,
based on the assumptions stated in that prospectus supplement, including
assumptions regarding prepayments on the underlying mortgage loans. Those tables
and assumptions illustrate the sensitivity of the weighted average lives of
those offered certificates to various assumed prepayment rates and are not
intended to predict, or to provide information that will enable you to predict,
the actual weighted average lives of your offered certificates.
OTHER FACTORS AFFECTING YIELD, WEIGHTED AVERAGE LIFE AND MATURITY
Balloon Payments; Extensions of Maturity. Some or all of the mortgage
loans underlying a series of offered certificates may require that balloon
payments be made at maturity. The ability of a borrower to make a balloon
payment typically will depend upon its ability either--
- to refinance the loan, or
- to sell the related real property.
If a borrower is unable to refinance or sell the related real property, there is
a possibility that the borrower may default on the mortgage loan or that the
maturity of the mortgage loan may be extended in connection with a workout. If a
borrower defaults, recovery of proceeds may be delayed by--
- the bankruptcy of the borrower, or
- adverse economic conditions in the market where the related real property
is located.
In order to minimize losses on defaulted mortgage loans, the related master
servicer or special servicer may be authorized within prescribed limits to
modify mortgage loans that are in default or as to which a payment default is
reasonably foreseeable. Any defaulted balloon payment or modification that
extends the maturity of a mortgage loan may delay payments of principal on your
offered certificates and extend the weighted average life of your offered
certificates.
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Negative Amortization. The weighted average life of a class of offered
certificates can be affected by mortgage loans that permit negative amortization
to occur. Those are the mortgage loans that provide for the current payment of
interest calculated at a rate lower than the rate at which interest accrues on
the mortgage loan, with the unpaid portion of that interest being added to the
related principal balance. Negative amortization most commonly occurs with
respect to an adjustable rate mortgage loan that:
- limits the amount by which its scheduled payment may adjust in response
to a change in its mortgage interest rate;
- provides that its scheduled payment will adjust less frequently than its
mortgage interest rate; or
provides for constant scheduled payments regardless of adjustments to its
mortgage interest rate.
Negative amortization on one or more mortgage loans in any of our trusts
may result in negative amortization on a related class of offered certificates.
We will describe in the related prospectus supplement, if applicable, the manner
in which negative amortization with respect to the underlying mortgage loans is
allocated among the respective classes of a series of offered certificates.
The portion of any mortgage loan negative amortization allocated to a class
of offered certificates may result in a deferral of some or all of the interest
payable on those certificates. Deferred interest may be added to the total
principal balance of a class of offered certificates. In addition, an adjustable
rate mortgage loan that permits negative amortization would be expected during a
period of increasing interest rates to amortize, if at all, at a slower rate
than if interest rates were declining or were remaining constant. This slower
rate of mortgage loan amortization would be reflected in a slower rate of
amortization for one or more classes of certificates of the related series.
Accordingly, there may be an increase in the weighted average lives of those
classes of certificates to which any mortgage loan negative amortization would
be allocated or that would bear the effects of a slower rate of amortization of
the underlying mortgage loans.
The extent to which the yield on your offered certificates may be affected
by any negative amortization on the underlying mortgage loans will depend, in
part, upon whether you purchase your offered certificates at a premium or a
discount.
During a period of declining interest rates, the scheduled payment on an
adjustable rate mortgage loan may exceed the amount necessary to amortize the
loan fully over its remaining amortization schedule and pay interest at the then
applicable mortgage interest rate. The result is the accelerated amortization of
the mortgage loan. The acceleration in amortization of a mortgage loan will
shorten the weighted average lives of those classes of certificates that entitle
their holders to a portion of the principal payments on the mortgage loan.
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Foreclosures and Payment Plans. The weighted average life of and yield on
your offered certificates will be affected by--
- the number of foreclosures with respect to the underlying mortgage loans;
and
- the principal amount of the foreclosed mortgage loans in relation to the
principal amount of those mortgage loans that are repaid in accordance
with their terms.
Servicing decisions made with respect to the underlying mortgage loans,
including the use of payment plans prior to a demand for acceleration and the
restructuring of mortgage loans in bankruptcy proceedings or otherwise, may also
affect the payment patterns of particular mortgage loans and, as a result, the
weighted average life of and yield on your offered certificates.
Losses and Shortfalls on the Mortgage Assets. The yield on your offered
certificates will directly depend on the extent to which you are required to
bear the effects of any losses or shortfalls in collections on the underlying
mortgage loans and the timing of those losses and shortfalls. In general, the
earlier that you bear any loss or shortfall, the greater will be the negative
effect on the yield of your offered certificates.
The amount of any losses or shortfalls in collections on the mortgage
assets in any of our trusts will, to the extent not covered or offset by draws
on any reserve fund or under any instrument of credit support, be allocated
among the various classes of certificates of the related series in the priority
and manner, and subject to the limitations, that we specify in the related
prospectus supplement. As described in the related prospectus supplement, those
allocations may be effected by the following:
- a reduction in the entitlements to interest and/or the total principal
balances of one or more classes of certificates; and/or
- the establishment of a priority of payments among classes of
certificates.
If you purchase subordinated certificates, the yield to maturity on those
certificates may be extremely sensitive to losses and shortfalls in collections
on the underlying mortgage loans.
Additional Certificate Amortization. If your offered certificates have a
principal balance, then they entitle you to a specified portion of the principal
payments received on the underlying mortgage loans. They may also entitle you to
payments of principal from the following sources:
- amounts attributable to interest accrued but not currently payable on one
or more other classes of certificates of the applicable series;
- interest received or advanced on the underlying mortgage assets that is
in excess of the interest currently accrued on the certificates of the
applicable series;
- prepayment premiums, fees and charges, payments from equity
participations or any other amounts received on the underlying mortgage
assets that do not constitute interest or principal; or
- any other amounts described in the related prospectus supplement.
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The amortization of your offered certificates out of the sources described
in the prior paragraph would shorten their weighted average life and, if your
offered certificates were purchased at a premium, reduce their yield to
maturity.
SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
We were incorporated in Delaware on January 27, 1987. We were organized,
among other things, for the purpose of serving as a private secondary mortgage
market conduit.
We are an indirect, wholly-owned subsidiary of Salomon Smith Barney
Holdings Inc. and an affiliate of Salomon Smith Barney Inc. Our principal
executive offices are located at 388 Greenwich Street, New York, New York 10013.
Our telephone number is 212-816-6000.
We do not have, and do not expect in the future to have, any significant
assets.
DESCRIPTION OF THE CERTIFICATES
GENERAL
Each series of offered certificates, together with any non-offered
certificates of the same series, will represent the entire beneficial ownership
interest in a trust established by us. Each series of offered certificates will
consist of one or more classes. Any non-offered certificates of that series will
likewise consist of one or more classes.
A series of certificates consists of all those certificates that--
- have the same series designation;
- were issued under the same governing documents; and
- represent beneficial ownership interests in the same trust.
A class of certificates consists of all those certificates of a particular
series that--
- have the same class designation; and
- have the same payment terms.
The respective classes of offered and non-offered certificates of any
series may have a variety of payment terms. An offered certificate may entitle
the holder to receive:
- a stated principal amount, which will be represented by its principal
balance;
- interest on a principal balance or notional amount, at a fixed, variable
or adjustable pass-through rate;
- specified, fixed or variable portions of the interest, principal or other
amounts received on the related mortgage assets;
- payments of principal, with disproportionate, nominal or no payments of
interest;
- payments of interest, with disproportionate, nominal or no payments of
principal;
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- payments of interest or principal that commence only as of a specified
date or only after the occurrence of specified events, such as the
payment in full of the interest and principal outstanding on one or more
other classes of certificates of the same series;
- payments of principal to be made, from time to time or for designated
periods, at a rate that is--
1. faster and, in some cases, substantially faster, or
2. slower and, in some cases, substantially slower,
than the rate at which payments or other collections of principal are
received on the related mortgage assets;
- payments of principal to be made, subject to available funds, based on a
specified principal payment schedule or other methodology; or
- payments of all or part of the prepayment or repayment premiums, fees and
charges, equity participations payments or other similar items received
on the related mortgage assets.
Any class of offered certificates may be senior or subordinate to one or
more other classes of certificates of the same series, including a non-offered
class of certificates of that series, for purposes of some or all payments
and/or allocations of losses or other shortfalls.
A class of offered certificates may have two or more component parts, each
having characteristics that are described in this prospectus as being
attributable to separate and distinct classes. For example, a class of offered
certificates may have a total principal balance on which it accrues interest at
a fixed, variable or adjustable rate. That class of offered certificates may
also accrue interest on a total notional amount at a different fixed, variable
or adjustable rate. In addition, a class of offered certificates may accrue
interest on one portion of its total principal balance or notional amount at one
fixed, variable or adjustable rate and on another portion of its total principal
balance or notional amount at a different fixed, variable or adjustable rate.
Each class of offered certificates will be issued in minimum denominations
corresponding to specified principal balances, notional amounts or percentage
interests, as described in the related prospectus supplement. A class of offered
certificates may be issued in fully registered, definitive form and evidenced by
physical certificates or may be issued in book-entry form through the facilities
of The Depository Trust Company. Offered certificates held in fully registered,
definitive form may be transferred or exchanged, subject to any restrictions on
transfer described in the related prospectus supplement, at the location
specified in the related prospectus supplement, without the payment of any
service charges, except for any tax or other governmental charge payable in
connection with the transfer or exchange. Interests in offered certificates held
in book-entry form will be transferred on the book-entry records of DTC and its
participating organizations. If we so specify in the related prospectus
supplement, we will arrange for
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clearance and settlement through Clearstream Banking, societe anonyme or the
Euroclear System, for so long as they are participants in DTC.
PAYMENTS ON THE CERTIFICATES
General. Payments on a series of offered certificates may occur monthly,
bi-monthly, quarterly, semi-annually, annually or at any other specified
interval. In the prospectus supplement for each series of offered certificates,
we will identify:
- the periodic payment date for that series, and
- the record date as of which certificateholders entitled to payments on
any particular payment date will be established.
All payments with respect to a class of offered certificates on any payment
date will be allocated pro rata among the outstanding certificates of that class
in proportion to the respective principal balances, notional amounts or
percentage interests, as the case may be, of those certificates. Payments on an
offered certificate will be made to the holder entitled thereto either--
- by wire transfer of immediately available funds to the account of that
holder at a bank or similar entity, provided that the holder has
furnished the party making the payments with wiring instructions no later
than the applicable record date and has satisfied any other conditions
specified in the related prospectus supplement, or
- by check mailed to the address of that holder as it appears in the
certificate register, in all other cases.
In general, the final payment on any offered certificate will be made only
upon presentation and surrender of that certificate at the location specified to
the holder in notice of final payment.
Payments of Interest. In the case of each class of interest-bearing
offered certificates, interest will accrue from time to time, at the applicable
pass-through rate and in accordance with the applicable interest accrual method,
on the total outstanding principal balance or notional amount of that class.
The pass-through rate for a class of interest-bearing offered certificates
may be fixed, variable or adjustable. We will specify in the related prospectus
supplement the pass-through rate for each class of interest-bearing offered
certificates or, in the case of a variable or adjustable pass-through rate, the
method for determining that pass-through rate.
Interest may accrue with respect to any offered certificate on the basis
of:
- a 360-day year consisting of 12 30-day months,
- the actual number of days elapsed during each relevant period in a year
assumed to consist of 360 days,
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- the actual number of days elapsed during each relevant period in a normal
calendar year, or
- any other method identified in the related prospectus supplement.
We will identify the interest accrual method for each class of offered
certificates in the related prospectus supplement.
Subject to available funds and any adjustments to interest entitlements
described in the related prospectus supplement, accrued interest with respect to
each class of interest-bearing offered certificates will normally be payable on
each payment date. However, in the case of some classes of interest-bearing
offered certificates, payments of accrued interest will only begin on a
particular payment date or under the circumstances described in the related
prospectus supplement. Prior to that time, the amount of accrued interest
otherwise payable on that class will be added to its total principal balance on
each date or otherwise deferred as described in the related prospectus
supplement.
If a class of offered certificates accrues interest on a total notional
amount, that total notional amount, in general, will be either:
- based on the principal balances of some or all of the related mortgage
assets; or
- equal to the total principal balances of one or more other classes of
certificates of the same series.
Reference to the notional amount of any certificate is solely for
convenience in making calculations of interest and does not represent the right
to receive any payments of principal.
We will describe in the related prospectus supplement the extent to which
the amount of accrued interest that is payable on, or that may be added to the
total principal balance of, a class of interest-bearing offered certificates may
be reduced as a result of any contingencies, including shortfalls in interest
collections due to prepayments, delinquencies, losses and deferred interest on
the related mortgage assets.
Payments of Principal. An offered certificate may or may not have a
principal balance. If it does, that principal balance outstanding from time to
time will represent the maximum amount that the holder of that certificate will
be entitled to receive as principal out of the future cash flow on the related
mortgage assets and the other related trust assets.
The total outstanding principal balance of any class of offered
certificates will be reduced by--
- payments of principal actually made to the holders of that class, and
- if and to the extent that we so specify in the related prospectus
supplement, losses of principal on the related mortgage assets that are
allocated to or are required to be borne by that class.
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A class of interest-bearing offered certificates may provide that payments
of accrued interest will only begin on a particular payment date or under the
circumstances described in the related prospectus supplement. If so, the total
outstanding principal balance of that class may be increased by the amount of
any interest accrued, but not currently payable, on that class.
We will describe in the related prospectus supplement any other adjustments
to the total outstanding principal balance of a class of offered certificates.
Unless we so state in the related prospectus supplement, the initial total
principal balance of all classes of a series will not be greater than the total
outstanding principal balance of the related mortgage assets transferred by us
to the related trust. We will specify the expected initial total principal
balance of each class of offered certificates in the related prospectus
supplement.
The payments of principal to be made on a series of offered certificates
from time to time will, in general, be a function of the payments, other
collections and advances received or made with respect to the related prospectus
supplement. Payments of principal on a series of offered certificates may also
be made from the following sources:
- amounts attributable to interest accrued but not currently payable on one
or more other classes of certificates of the applicable series;
- interest received or advanced on the underlying mortgage assets that is
in excess of the interest currently accrued on the certificates of the
applicable series;
- prepayment premiums, fees and charges, payments from equity
participations or any other amounts received on the underlying mortgage
assets that do not constitute interest or principal; or
- any other amounts described in the related prospectus supplement.
We will describe in the related prospectus supplement the principal
entitlement of each class of offered certificates on each payment date.
ALLOCATION OF LOSSES AND SHORTFALLS
If and to the extent that any losses or shortfalls in collections on the
mortgage assets in any of our trusts are not covered or offset by delinquency
advances or draws on any reserve fund or under any instrument of credit support,
they will be allocated among the various classes of certificates of the related
series in the priority and manner, and subject to the limitations, specified in
the related prospectus supplement. As described in the related prospectus
supplement, the allocations may be effected as follows:
- by reducing the entitlements to interest and/or the total principal
balances of one or more of those classes; and/or
- by establishing a priority of payments among those classes.
See "Description of Credit Support."
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ADVANCES
If any trust established by us includes mortgage loans, then as and to the
extent described in the related prospectus supplement, the related master
servicer, the related special servicer, the related trustee, any related
provider of credit support and/or any other specified person may be obligated to
make, or may have the option of making, advances with respect to those mortgage
loans to cover--
- delinquent payments of principal and/or interest, other than balloon
payments,
- property protection expenses,
- other servicing expenses, or
- any other items specified in the related prospectus supplement.
If there are any limitations with respect to a party's advancing
obligations, we will discuss those limitations in the related prospectus
supplement.
Advances are intended to maintain a regular flow of scheduled interest and
principal payments to certificateholders. Advances are not a guarantee against
losses. The advancing party will be entitled to recover all of its advances out
of--
- subsequent recoveries on the related mortgage loans, including amounts
drawn under any fund or instrument constituting credit support, and
- any other specific sources identified in the related prospectus
supplement.
If and to the extent that we so specify in the related prospectus
supplement, any entity making advances will be entitled to receive interest on
some or all of those advances for a specified period during which they are
outstanding at the rate specified in that prospectus supplement. That entity may
be entitled to payment of interest on its outstanding advances--
- periodically from general collections on the mortgage assets in the
related trust, prior to any payment to the related series of
certificateholders, or
- at any other times and from any other sources as we may describe in the
related prospectus supplement.
If any trust established by us includes mortgage-backed securities, we will
discuss in the related prospectus supplement any comparable advancing
obligations with respect to those securities or the mortgage loans that back
them.
REPORTS TO CERTIFICATEHOLDERS
On or about each payment date, the related master servicer, manager or
trustee will forward to each offered certificateholder a statement substantially
in the form, or specifying the information, set forth in the related prospectus
supplement. In general, that statement will include information regarding--
- the payments made on that payment date with respect to the applicable
class of offered certificates, and
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- the recent performance of the mortgage assets.
Within a reasonable period of time after the end of each calendar year, the
related master servicer, manager or trustee, as the case may be, will be
required to furnish to each person who at any time during the calendar year was
a holder of an offered certificate a statement containing information regarding
the principal, interest and other amounts paid on the applicable class of
offered certificates, aggregated for--
- that calendar year, or
- the applicable portion of that calendar year during which the person was
a certificateholder.
The obligation to provide that annual statement will be deemed to have been
satisfied by the related master servicer, manager or trustee, as the case may
be, to the extent that substantially comparable information is provided in
accordance with any requirements of the Internal Revenue Code of 1986.
If one of our trusts includes mortgage-backed securities, the ability of
the related master servicer, manager or trustee, as the case may be, to include
in any payment date statement information regarding the mortgage loans that back
those securities will depend on comparable reports being received with respect
to them.
VOTING RIGHTS
Voting rights will be allocated among the respective classes of offered and
non-offered certificates of each series in the manner described in the related
prospectus supplement. Certificateholders will generally not have a right to
vote, except--
- with respect to those amendments to the governing documents described
under "Description of the Governing Documents--Amendment", or
- as otherwise specified in this prospectus or in the related prospectus
supplement.
As and to the extent described in the related prospectus supplement, the
certificateholders entitled to a specified amount of the voting rights for a
particular series will have the right to act as a group to remove or replace the
related trustee, master servicer, special servicer or manager. In general, that
removal or replacement must be for cause. We will identify exceptions in the
related prospectus supplement.
TERMINATION
The trust for each series of offered certificates will terminate and cease
to exist following:
- the final payment or other liquidation of the last mortgage asset in that
trust; and
- the payment, or provision for payment, to the certificateholders of that
series of all amounts required to be paid to them.
Written notice of termination of a trust will be given to each affected
certificateholder. The final payment will be made only upon presentation and
surrender
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of the certificates of the related series at the location to be specified in the
notice of termination.
If we so specify in the related prospectus supplement, one or more
designated parties will be entitled to purchase all of the mortgage assets
underlying a series of offered certificates, thereby effecting early retirement
of the certificates and early termination of the related trust. We will describe
in the related prospectus supplement the circumstances under which that purchase
may occur.
If we so specify in the related prospectus supplement, one or more
certificateholders will be entitled to exchange all of the certificates of a
particular series for all of the mortgage assets underlying that series, thereby
effecting early termination of the related trust. We will describe in the
related prospectus supplement the circumstances under which that exchange may
occur.
In addition, if we so specify in the related prospectus supplement, on a
specified date or upon the reduction of the total principal balance of a
specified class or classes of certificates by a specified percentage or amount,
a party designated in the related prospectus supplement may be authorized or
required to solicit bids for the purchase of all the mortgage assets of the
related trust or of a sufficient portion of the mortgage assets to retire that
class or those classes of certificates. The solicitation of bids must be
conducted in a commercially reasonable manner, and assets will, in general, be
sold at their fair market value. If the fair market value of the mortgage assets
being sold is less than their unpaid balance, then the certificateholders of one
or more classes of certificates may receive an amount less than the total
principal balance of, and accrued and unpaid interest on, their certificates.
BOOK-ENTRY REGISTRATION
General. Any class of offered certificates may be issued in book-entry
form through the facilities of DTC. If so, that class will be represented by one
or more global certificates registered in the name of DTC or its nominee. If we
so specify in the related prospectus supplement, we will arrange for clearance
and settlement through the Euroclear System or Clearstream Banking, societe
anonyme, for so long as they are participants in DTC.
DTC, Euroclear and Clearstream. DTC is:
- a limited-purpose trust company organized under the New York Banking Law,
- a "banking corporation" within the meaning of the New York Banking Law,
- a member of the Federal Reserve System,
- a "clearing corporation" within the meaning of the New York Uniform
Commercial Code, and
- a "clearing agency" registered under the provisions of Section 17A of the
Securities Exchange Act of 1934, as amended.
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DTC was created to hold securities for participants in the DTC system and
to facilitate the clearance and settlement of securities transactions between
those participants through electronic computerized book-entry changes in their
accounts, thereby eliminating the need for physical movement of securities
certificates. Organizations that maintain accounts with DTC include securities
brokers and dealers, banks, trust companies and clearing corporations and may
include other organizations. DTC is owned by a number of its participating
organizations and by the New York Stock Exchange, Inc., the American Stock
Exchange, Inc. and the National Association of Securities Dealers, Inc. Access
to the DTC system is also available to others such as banks, brokers, dealers
and trust companies that directly or indirectly clear through or maintain a
custodial relationship with one of the organizations that maintains an account
with DTC. The rules applicable to DTC and its participating organizations are on
file with the SEC.
It is our understanding that Clearstream was incorporated in 1970 as "Cedel
S.A.," a company with limited liability under the laws of Luxembourg. Cedel S.A.
subsequently changed its name to Cedelbank. On January 10, 2000, Cedelbank's
parent company, Cedel International, societe anonyme merged its clearing,
settlement and custody business with that of Deutsche Borse Clearing AG. The
merger involved the transfer by Cedel International of substantially all of its
assets and liabilities, including its shares in Cedelbank, to a new Luxembourg
company, New Cedel International, societe anonyme. New Cedel International is
50% owned by Cedel International and 50% by Deutsche Borse AG, the parent of
Deutsche Borse Clearing AG. The shareholders of these two entities are
recognized financial institutions around the world, including underwriters,
securities brokers and dealers, banks, trust companies and clearing
corporations. On January 18, 2000, Cedelbank was renamed Clearstream Banking,
societe anonyme. Clearstream holds securities for its member organizations and
facilitates the clearance and settlement of securities transactions between its
member organizations through electronic book-entry changes in accounts of those
organizations, thereby eliminating the need for physical movement of
certificates. Transactions may be settled in Clearstream in any of 36
currencies, including United States dollars. Clearstream provides to its member
organizations, among other things, services for safekeeping, administration,
clearance and settlement of internationally traded securities and securities
lending and borrowing. Clearstream interfaces with domestic securities markets
in over 30 countries through established depository and custodial relationships.
Clearstream is registered as a bank in Luxembourg. It is subject to regulation
by the Commission de Surveillance du Secteur Financier, which supervises
Luxembourg banks. Clearstream's customers are world-wide financial institutions
including underwriters, securities brokers and dealers, banks, trust companies
and clearing corporations. Clearstream's U.S. customers are limited to
securities brokers and dealers, and banks. Currently, Clearstream has
approximately 2,000 customers located in over 80 countries, including all major
European countries, Canada and the United States. Indirect access to Clearstream
is available to other institutions that clear through or maintain a custodial
relationship with an account holder of Clearstream. Clearstream and Euroclear
have established an
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electronic bridge between their two systems across which their respective
participants may settle trades with each other.
It is our understanding that Euroclear was founded in December 1968 to hold
securities for its member organizations and to clear and settle transactions
between its member organizations through simultaneous electronic book-entry
delivery against payment, thereby eliminating the need for physical movement of
certificates and any risk from lack of simultaneous transfers of securities and
cash. Over 100,000 different securities are accepted for settlement through
Euroclear, the majority of which are domestic securities from over 30 markets.
Transactions may be settled in Euroclear in any of over 35 currencies, including
United States dollars. The Euroclear system includes various other services,
including securities lending and borrowing and interfaces with domestic markets
in several countries generally similar to the arrangements for cross-market
transfers with DTC described below in this "--Book-Entry Registration" section.
Euroclear is operated by Morgan Guaranty Trust Company of New York, Brussels,
Belgium office, under contract with Euroclear Clearance System, S.C., a Belgian
cooperative corporation. Under an agreement effective January 1, 2000, the role
of the Morgan Guaranty Trust Company of New York will be taken over by a new
market-owned Euroclear Bank in early 2001. All operations are conducted by the
Euroclear Operator, and all Euroclear securities clearance accounts and
Euroclear cash accounts are accounts with the Euroclear Operator, not ECS. ECS
establishes policy for the Euroclear system on behalf of the more than 120
member organizations of Euroclear. Those member organizations include banks,
including central banks, securities brokers and dealers and other professional
financial intermediaries. Indirect access to the Euroclear system is also
available to other firms that clear through or maintain a custodial relationship
with a member organization of Euroclear, either directly or indirectly.
Euroclear and Clearstream have established an electronic bridge between their
two systems across which their respective participants may settle trades with
each other.
The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. It is
regulated and examined by the Board of Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Euroclear Terms and Conditions. The Euroclear Terms and
Conditions govern transfers of securities and cash within the Euroclear system,
withdrawal of securities and cash from the Euroclear system, and receipts of
payments with respect to securities in the Euroclear system. All securities in
the Euroclear system are held on a fungible basis without attribution of
specific securities to specific securities clearance accounts. The Euroclear
Operator acts under the Euroclear Terms and Conditions only on behalf of member
organizations of Euroclear and has no record of or relationship with persons
holding through those member organizations.
The information in this prospectus concerning DTC, Euroclear and
Clearstream, and their book-entry systems, has been obtained from sources
believed to be reliable, but we do not take any responsibility for the accuracy
or completeness of that information.
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Holding and Transferring Book-Entry Certificates. Purchases of book-entry
certificates under the DTC system must be made by or through, and will be
recorded on the records of, the Financial Intermediary that maintains the
beneficial owner's account for that purpose. In turn, the Financial
Intermediary's ownership of those certificates will be recorded on the records
of DTC or, alternatively, if the Financial Intermediary does not maintain an
account with DTC, on the records of a participating firm that acts as agent for
the Financial Intermediary, whose interest will in turn be recorded on the
records of DTC. A beneficial owner of book-entry certificates must rely on the
foregoing procedures to evidence its beneficial ownership of those certificates.
DTC has no knowledge of the actual beneficial owners of the book-entry
certificates. DTC's records reflect only the identity of the direct participants
to whose accounts those certificates are credited, which may or may not be the
actual beneficial owners. The participants in the DTC system will remain
responsible for keeping account of their holdings on behalf of their customers.
Transfers between participants in the DTC system will be effected in the
ordinary manner in accordance with DTC's rules and will be settled in same-day
funds. Transfers between direct account holders at Euroclear and Clearstream, or
between persons or entities participating indirectly in Euroclear or
Clearstream, will be effected in the ordinary manner in accordance with their
respective procedures and in accordance with DTC's rules.
Cross-market transfers between direct participants in DTC, on the one hand,
and member organizations at Euroclear or Clearstream, on the other, will be
effected through DTC in accordance with DTC's rules and the rules of Euroclear
or Clearstream, as applicable. These cross-market transactions will require,
among other things, delivery of instructions by the applicable member
organization to Euroclear or Clearstream, as the case may be, in accordance with
the rules and procedures and within deadlines, Brussels time, established in
Euroclear or Clearstream, as the case may be. If the transaction complies with
all relevant requirements, Euroclear or Clearstream, as the case may be, will
then deliver instructions to its depositary to take action to effect final
settlement on its behalf.
Because of time-zone differences, the securities account of a member
organization of Euroclear or Clearstream purchasing an interest in a global
certificate from a DTC participant that is not a member organization, will be
credited during the securities settlement processing day, which must be a
business day for Euroclear or Clearstream, as the case may be, immediately
following the DTC settlement date. Transactions in interests in a book-entry
certificate settled during any securities settlement processing day will be
reported to the relevant member organization of Euroclear or Clearstream on the
same day. Cash received in Euroclear or Clearstream as a result of sales of
interests in a book-entry certificate by or through a member organization of
Euroclear or Clearstream, as the case may be, to a DTC participant that is not a
member organization will be received with value on the DTC settlement date, but
will not be available in the relevant Euroclear or Clearstream cash account
until the business day following settlement in DTC. The related prospectus
supplement will contain additional
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information regarding clearance and settlement procedures for the book-entry
certificates and with respect to tax documentation procedures relating to the
book-entry certificates.
Conveyance of notices and other communications by DTC to DTC participants,
and by DTC participants to Financial Intermediaries and beneficial owners, will
be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
Payments on the book-entry certificates will be made to DTC. DTC's practice
is to credit DTC participants' accounts on the related payment date in
accordance with their respective holdings shown on DTC's records, unless DTC has
reason to believe that it will not receive payment on that date. Disbursement of
those payments by DTC participants to Financial Intermediaries and beneficial
owners will be--
- governed by standing instructions and customary practices, as is the case
with securities held for the accounts of customers in bearer form or
registered in street name, and
- the sole responsibility of each of those DTC participants, subject to any
statutory or regulatory requirements in effect from time to time.
Under a book-entry system, beneficial owners may receive payments after the
related payment date.
The only "certificateholder" of book-entry certificates will be DTC or its
nominee. Parties to the governing documents for any series of offered
certificates need not recognize beneficial owners of book-entry certificates as
"certificateholders." The beneficial owners of book-entry certificates will be
permitted to exercise the rights of "certificateholders" only indirectly through
the DTC participants, who in turn will exercise their rights through DTC. We
have been informed that DTC will take action permitted to be taken by a
"certificateholder" only at the direction of one or more DTC participants. DTC
may take conflicting actions with respect to the book-entry certificates to the
extent that those actions are taken on behalf of Financial Intermediaries whose
holdings include those certificates.
Because DTC can act only on behalf of DTC participants, who in turn act on
behalf of Financial Intermediaries and beneficial owners of the applicable
book-entry securities, the ability of a beneficial owner to pledge its interest
in a class of book-entry certificates to persons or entities that do not
participate in the DTC system, or otherwise to take actions with respect to its
interest in a class of book-entry certificates, may be limited due to the lack
of a physical certificate evidencing that interest.
Issuance of Definitive Certificates. Unless we specify otherwise in the
related prospectus supplement, beneficial owners of affected offered
certificates initially issued in book-entry form will not be able to obtain
physical certificates that represent those offered certificates, unless:
- we advise the related trustee in writing that DTC is no longer willing or
able to discharge properly its responsibilities as depository with
respect to those offered certificates and we are unable to locate a
qualified successor; or
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- we elect, at our option, to terminate the book-entry system through DTC
with respect to those offered certificates.
Upon the occurrence of either of the two events described in the prior
paragraph, DTC will be required to notify all DTC participants of the
availability through DTC of physical certificates with respect to the affected
offered certificates. Upon surrender by DTC of the certificate or certificates
representing a class of book-entry offered certificates, together with
instructions for registration, the related trustee or other designated party
will be required to issue to the beneficial owners identified in those
instructions physical certificates representing those offered certificates.
DESCRIPTION OF THE GOVERNING DOCUMENTS
GENERAL
The Governing Document for purposes of issuing the offered certificates of
each series will be a pooling and servicing agreement or other similar agreement
or collection of agreements. In general, the parties to the Governing Document
for a series of offered certificates will include us, a trustee, a master
servicer and a special servicer. However, if the related trust assets include
mortgage-backed securities, the Governing Document may include a manager as a
party, but may not include a master servicer, special servicer or other servicer
as a party. We will identify in the related prospectus supplement the parties to
the Governing Document for a series of offered certificates.
If we so specify in the related prospectus supplement, a party from whom we
acquire mortgage assets or one of its affiliates may perform the functions of
master servicer, special servicer or manager for the trust to which we transfer
those assets. If we so specify in the related prospectus supplement, the same
person or entity may act as both master servicer and special servicer for one of
our trusts.
Any party to the Governing Document for a series of offered certificates,
or any of its affiliates, may own certificates issued thereunder. However,
except in limited circumstances, including with respect to required consents to
amendments to the Governing Document for a series of offered certificates,
certificates that are held by the related master servicer, special servicer or
manager will not be allocated voting rights.
A form of a pooling and servicing agreement has been filed as an exhibit to
the registration statement of which this prospectus is a part. However, the
provisions of the Governing Document for each series of offered certificates
will vary depending upon the nature of the certificates to be issued thereunder
and the nature of the related trust assets. The following summaries describe
select provisions that may appear in the Governing Document for each series of
offered certificates. The prospectus supplement for each series of offered
certificates will provide material additional information regarding the
Governing Document for that series. The summaries in this prospectus do not
purport to be complete, and you should refer to the provisions of the Governing
Document for your offered certificates and, further, to the description of those
provisions in the related prospectus supplement. We will provide a copy of the
Governing
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Document, exclusive of exhibits, that relates to your offered certificates,
without charge, upon written request addressed to our principal executive
offices specified under "Salomon Brothers Mortgage Securities VII, Inc."
ASSIGNMENT OF MORTGAGE ASSETS
At the time of initial issuance of any series of offered certificates, we
will assign or cause to be assigned to the designated trustee the mortgage
assets and any other assets to be included in the related trust. We will specify
in the related prospectus all material documents to be delivered, and all other
material actions to be taken, by us or any prior holder of the related mortgage
assets in connection with that assignment. We will also specify in the related
prospectus supplement any remedies available to the related certificateholders,
or the related trustee on their behalf, in the event that any of those material
documents are not delivered or any of those other material actions are not taken
as required. Concurrently with that assignment, the related trustee will deliver
to us or our designee the certificates of that series in exchange for the
mortgage assets and the other assets to be included in the related trust.
Each mortgage asset included in one of our trusts will be identified in a
schedule appearing as an exhibit to the related Governing Document. That
schedule generally will include detailed information about each mortgage asset
transferred to the related trust, including:
1. in the case of a mortgage loan--
2. the address of the related real property,
3. the mortgage interest rate and, if applicable, the applicable index,
gross margin, adjustment date and any rate cap information,
4. the remaining term to maturity,
5. the remaining amortization term, and
6. the outstanding principal balance; and
7. in the case of a mortgage-backed security, the outstanding principal
balance and the pass-through rate or coupon rate.
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO MORTGAGE ASSETS
Unless we state otherwise in the prospectus supplement for any series of
offered certificates, we will, with respect to each mortgage asset in the
related trust, make or assign, or cause to be made or assigned, a limited set of
representations and warranties covering, by way of example:
- the accuracy of the information set forth for each mortgage asset on the
schedule of mortgage assets appearing as an exhibit to the Governing
Document for that series;
- the warranting party's title to each mortgage asset and the authority of
the warranting party to sell that mortgage asset; and
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- in the case of a mortgage loan--
1. the enforceability of the related mortgage note and mortgage,
2. the existence of title insurance insuring the lien priority of the
related mortgage, and
3. the payment status of the mortgage loan.
We will identify the warranting party, and give a more complete sampling of
the representations and warranties made thereby, in the related prospectus
supplement. We will also specify in the related prospectus supplement any
remedies against the warranting party available to the related
certificateholders, or the related trustee on their behalf, in the event of a
breach of any of those representations and warranties. In most cases, the
warranting party will be a prior holder of the particular mortgage assets.
COLLECTION AND OTHER SERVICING PROCEDURES WITH RESPECT TO MORTGAGE LOANS
The Governing Document for each series of offered certificates will govern
the servicing and administration of any mortgage loans included in the related
trust.
In general, the related master servicer and special servicer, directly or
through sub-servicers, will be obligated to service and administer for the
benefit of the related certificateholders the mortgage loans in any of our
trusts. The master servicer and the special servicer will be required to service
and administer those mortgage loans in accordance with applicable law and,
further, in accordance with the terms of the related Governing Document, the
mortgage loans themselves and any instrument of credit support included in that
trust. Subject to the foregoing, the master servicer and the special servicer
will each have full power and authority to do any and all things in connection
with that servicing and administration that it may deem necessary and desirable.
As part of its servicing duties, each of the master servicer and the
special servicer for one of our trusts will be required to make reasonable
efforts to collect all payments called for under the terms and provisions of the
related mortgage loans that it services. Consistent with the foregoing, the
master servicer and the special servicer will each be permitted, in its
discretion, to waive any default interest or late payment charge in connection
with collecting a late payment on any defaulted mortgage loan.
The master servicer and/or the special servicer for one or our trusts,
directly or through sub-servicers, will also be required to perform various
other customary functions of a servicer of comparable loans, including:
- maintaining escrow or impound accounts for the payment of taxes,
insurance premiums, ground rents and similar items, or otherwise
monitoring the timely payment of those items;
- ensuring that the related properties are properly insured;
- attempting to collect delinquent payments;
- supervising foreclosures;
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- negotiating modifications;
- responding to borrower requests for partial releases of the encumbered
property, easements, consents to alteration or demolition and similar
matters;
- protecting the interests of certificateholders with respect to senior
lienholders;
- conducting inspections of the related real properties on a periodic or
other basis;
- collecting and evaluating financial statements for the related real
properties;
- managing or overseeing the management of real properties acquired on
behalf of the trust through foreclosure, deed-in-lieu of foreclosure or
otherwise; and
- maintaining servicing records relating to mortgage loans in the trust.
We will specify in the related prospectus supplement when, and the extent
to which, servicing of a mortgage loan is to be transferred from a master
servicer to a special servicer. In general, a special servicer for any of our
trusts will be responsible for the servicing and administration of:
- mortgage loans that are delinquent with respect to a specified number of
scheduled payments;
- mortgage loans as to which there is a material non-monetary default;
- mortgage loans as to which the related borrower has--
1. entered into or consented to bankruptcy, appointment of a receiver
or conservator or similar insolvency proceeding, or
2. become the subject of a decree or order for such a proceeding which
has remained in force undischarged or unstayed for a specified
number of days; and
- real properties acquired as part of the trust with respect to defaulted
mortgage loans.
The related Governing Document may also provide that if a default on a mortgage
loan in the related trust has occurred or, in the judgment of the related master
servicer, a payment default is reasonably foreseeable, the related master
servicer may elect to transfer the servicing of that mortgage loan, in whole or
in part, to the related special servicer. When the circumstances no longer
warrant a special servicer's continuing to service a particular mortgage loan,
such as when the related borrower is paying in accordance with the forbearance
arrangement entered into between the special servicer and that borrower, the
master servicer will generally resume the servicing duties with respect to the
particular mortgage loan.
A borrower's failure to make required mortgage loan payments may mean that
operating income from the related real property is insufficient to service the
mortgage debt, or may reflect the diversion of that income from the servicing of
the mortgage debt. In addition, a borrower that is unable to make mortgage loan
payments may also be unable to make timely payment of taxes and otherwise to
maintain and insure the
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related real property. In general, with respect to each series of offered
certificates, the related special servicer will be required to monitor any
mortgage loan in the related trust that is in default, evaluate whether the
causes of the default can be corrected over a reasonable period without
significant impairment of the value of the related real property, initiate
corrective action in cooperation with the mortgagor if cure is likely, inspect
the related real property and take any other actions as it deems necessary and
appropriate. A significant period of time may elapse before a special servicer
is able to assess the success of any corrective action or the need for
additional initiatives. The time period within which a special servicer can--
- make the initial determination of appropriate action,
- evaluate the success of corrective action,
- develop additional initiatives,
- institute foreclosure proceedings and actually foreclose, or
- accept a deed to a real property in lieu of foreclosure, on behalf of the
certificateholders of the related series,
may vary considerably depending on the particular mortgage loan, the related
real property, the borrower, the presence of an acceptable party to assume the
mortgage loan and the laws of the jurisdiction in which the related real
property is located. If a borrower files a bankruptcy petition, the special
servicer may not be permitted to accelerate the maturity of the defaulted loan
or to foreclose on the related real property for a considerable period of time.
See "Legal Aspects of Mortgage Loans--Bankruptcy Laws."
A special servicer for one of our trusts may also perform limited duties
with respect to mortgage loans in that trust for which the related master
servicer is primarily responsible, such as--
- performing property inspections and collecting, and
- evaluating financial statements.
A master servicer for one of our trusts may perform limited duties with
respect to any mortgage loan in that trust for which the related special
servicer is primarily responsible, such as--
- continuing to receive payments on the mortgage loan,
- making calculations with respect to the mortgage loan, and
- making remittances and preparing reports to the related trustee and/or
certificateholders with respect to the mortgage loan.
The duties of the master servicer and special servicer for your series will
be more fully described in the related prospectus supplement.
Unless we state otherwise in the related prospectus supplement, the master
servicer for your series will be responsible for filing and settling claims with
respect to particular
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mortgage loans for your series under any applicable instrument of credit
support. See "Description of Credit Support" in this prospectus.
SUB-SERVICERS
A master servicer or special servicer may delegate its servicing
obligations to one or more third-party servicers or sub-servicers. However,
unless we specify otherwise in the related prospectus supplement, the master
servicer or special servicer will remain obligated under the related Governing
Document. Each sub-servicing agreement between a master servicer or special
servicer, as applicable, and a sub-servicer must provide for servicing of the
applicable mortgage loans consistent with the related Governing Document. Any
master servicer and special servicer for one of our trusts will each be required
to monitor the performance of sub-servicers retained by it.
Unless we specify otherwise in the related prospectus supplement, any
master servicer or special servicer for one of our trusts will be solely liable
for all fees owed by it to any sub-servicer, regardless of whether the master
servicer's or special servicer's compensation under the related Governing
Document is sufficient to pay those fees. Each sub-servicer will be entitled to
reimbursement from the master servicer or special servicer, as the case may be,
that retained it, for expenditures which it makes, generally to the same extent
the master servicer or special servicer would be reimbursed under the related
Governing Document.
COLLECTION OF PAYMENTS ON MORTGAGE-BACKED SECURITIES
Unless we specify otherwise in the related prospectus supplement, if a
mortgage-backed security is included among the trust assets underlying any
series of offered certificates, then--
- that mortgage-backed security will be registered in the name of the
related trustee or its designee;
- the related trustee will receive payments on that mortgage-backed
security; and
- subject to any conditions described in the related prospectus supplement,
the related trustee or a designated manager will, on behalf and at the
expense of the trust, exercise all rights and remedies with respect to
that mortgaged-backed security, including the prosecution of any legal
action necessary in connection with any payment default.
MATTERS REGARDING THE MASTER SERVICER, THE SPECIAL SERVICER, THE MANAGER AND US
Unless we specify otherwise in the related prospectus supplement, no master
servicer, special servicer or manager for any of our trusts may resign from its
obligations in that capacity, except upon--
- the appointment of, and the acceptance of that appointment by, a
successor to the resigning party and receipt by the related trustee of
written confirmation from each applicable rating agency that the
resignation and appointment will not result
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in a withdrawal or downgrade of any rating assigned by that rating agency
to any class of certificates of the related series, or
- a determination that those obligations are no longer permissible under
applicable law or are in material conflict by reason of applicable law
with any other activities carried on by the resigning party.
In general, no resignation will become effective until the related trustee
or other successor has assumed the obligations and duties of the resigning
master servicer, special servicer or manager, as the case may be.
With respect to each series of offered certificates, we and the related
master servicer, special servicer and/or manager, if any, will, in each case, be
obligated to perform only those duties specifically required under the related
Governing Document.
In no event will we, any master servicer, special servicer or manager for
one of our trusts, or any of our or their respective members, managers,
directors, officers, employees or agents, be under any liability to that trust
or the related certificateholders for any action taken, or not taken, in good
faith under the related Governing Document or for errors in judgment. Neither we
nor any of those other persons or entities will be protected, however, against
any liability that would otherwise be imposed by reason of--
- willful misfeasance, bad faith or gross negligence in the performance of
obligations or duties under the Governing Document for any series of
offered certificates, or
- reckless disregard of those obligations and duties.
Furthermore, the Governing Document for each series of offered certificates
will entitle us, the master servicer, special servicer and/or manager for the
related trust, and our and their respective members, managers, directors,
officers, employees and agents, to indemnification out of the related trust
assets for any loss, liability or expense incurred in connection with any legal
action that relates to that Governing Document or series of offered certificates
or to the related trust. The indemnification will not extend, however, to any
loss, liability or expense:
- specifically required to be borne by the relevant party, without right of
reimbursement, under the terms of that Governing Document;
- incurred in connection with any legal action against the relevant party
resulting from any breach of a representation or warranty made in that
Governing Document; or
- incurred in connection with any legal action against the relevant party
resulting from any willful misfeasance, bad faith or gross negligence in
the performance of obligations or duties under that Governing Document.
Neither we nor any master servicer, special servicer or manager for the
related trust will be under any obligation to appear in, prosecute or defend any
legal action unless:
- the action is related to the respective responsibilities of that party
under the Governing Document for the affected series of offered
certificates; and
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- either--
1. that party is specifically required to bear the expense of the
action, or
2. the action will not, in its opinion, involve that party in any
ultimate expense or liability for which it would not be reimbursed
under the Governing Document for the affected series of offered
certificates.
However, we and each of those other parties may undertake any legal action
that we or any of them may deem necessary or desirable with respect to the
enforcement or protection of the rights and duties of the parties to the
Governing Document for any series of offered certificates and the interests of
the certificateholders of that series under that Government Document. In that
event, the legal expenses and costs of the action, and any liability resulting
from the action, will be expenses, costs and liabilities of the related trust
and payable out of related trust assets.
With limited exception, any person or entity--
- into which we or any related master servicer, special servicer or manager
may be merged or consolidated, or
- resulting from any merger or consolidation to which we or any related
master servicer, special servicer or manager is a party, or
- succeeding to our business or the business of any related master
servicer, special servicer or manager,
will be the successor of us or that master servicer, special servicer or
manager, as the case may be, under the Governing Document for a series of
offered certificates.
The compensation arrangements with respect to any master servicer, special
servicer or manager for any of our trusts will be set forth in the related
prospectus supplement. In general, that compensation will be payable out of the
related trust assets.
EVENTS OF DEFAULT
We will identify in related prospectus supplement the various events of
default under the Governing Document for each series of offered certificates for
which any related master servicer, special servicer or manager may be terminated
in that capacity.
AMENDMENT
The Governing Document for each series of offered certificates may be
amended by the parties thereto, without the consent of any of the holders of
those certificates, or of any non-offered certificates of the same series, for
the following reasons:
1. to cure any ambiguity;
2. to correct, modify or supplement any provision in the Governing Document
which may be inconsistent with any other provision in that document;
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3. to make any other provisions with respect to matters or questions
arising under the Governing Document that are not inconsistent with the
already existing provisions of that document;
4. to comply with any requirements imposed by the Internal Revenue Code of
1986 or any final, temporary or, in some cases, proposed regulation,
revenue ruling, revenue procedure or other written official announcement
or interpretation relating to federal income tax laws, or to avoid a
prohibited transaction or reduce the incidence of any tax that would
arise from any actions taken with respect to the operation of any REMIC,
FASIT or grantor trust created under the Governing Document;
5. to the extent applicable, to modify, add to or eliminate the transfer
restrictions relating to the certificates which are residual interests
in a REMIC; or
6. to otherwise modify or delete existing provisions of the Governing
Document.
However, no amendment of the Governing Document for any series of offered
certificates, except an amendment covered by clause 4. or 5. above, may
adversely affect in any material respect the interests of any holders of offered
or non-offered certificates of that series.
In general, the Governing Document for a series of offered certificates may
also be amended by the parties to that document, with the consent of the holders
of offered and non-offered certificates representing, in total, not less than
51%, or any other percentage specified in the related prospectus supplement, of
all the voting rights allocated to those classes of that series that are
affected by the amendment. However, the Governing Document for a series of
offered certificates may not be amended to--
- reduce in any manner the amount of, or delay the timing of, payments
received on the related mortgage assets which are required to be
distributed on any offered or non-offered certificate of that series,
without the consent of the holder of that certificate; or
- adversely affect in any material respect the interests of the holders of
any class of offered or non-offered certificates of that series in any
other manner, without the consent of the holders of all certificates of
that class; or
- modify the provisions of the Governing Document relating to amendments of
that document, without the consent of the holders of all offered and
non-offered certificates of that series then outstanding.
LIST OF CERTIFICATEHOLDERS
Upon written request of any certificateholder of record of any series made
for purposes of communicating with other holders of certificates of the same
series with respect to their rights under the related Governing Document, the
related trustee or other certificate registrar of that series will afford the
requesting certificateholders access during normal business hours to the most
recent list of certificateholders of that series. However, the trustee may first
require a copy of the communication that the requesting certificateholders
proposed to send.
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THE TRUSTEE
The trustee for each series of offered certificates will be named in the
related prospectus supplement. The commercial bank, banking association, banking
corporation or trust company that serves as trustee for any series of offered
certificates may have typical banking relationships with the us and our
affiliates and with any of the other parties to the related Governing Document
and its affiliates.
DUTIES OF THE TRUSTEE
The trustee for each series of offered certificates will not--
- make any representation as to the validity or sufficiency of those
certificates, the related Governing Document or any underlying mortgage
asset or related document, or
- be accountable for the use or application by or on behalf of any other
party to the related Governing Document of any funds paid to that party
with respect to those certificates or the underlying mortgage assets.
If no event of default has occurred and is continuing under the related
Governing Document, the trustee for each series of offered certificates will be
required to perform only those duties specifically required under the related
Governing Document. However, upon receipt of any of the various certificates,
reports or other instruments required to be furnished to it under the related
Governing Document, the trustee must examine those documents and determine
whether they conform to the requirements of that Governing Document.
MATTERS REGARDING THE TRUSTEE
As and to the extent described in the related prospectus supplement, the
fees and normal disbursements of the trustee for any series of offered
certificates may be the expense of the related master servicer or other
specified person or may be required to be paid by the related trust assets.
The trustee for each series of offered certificates, and any of its
directors, officers, employees and agents, will be entitled to indemnification,
out of related trust assets, for any loss, liability or expense incurred by that
trustee or any of those other persons in connection with that trustee's
acceptance or administration of its trusts under the related Governing Document.
However, the indemnification of a trustee will not extend to any loss, liability
or expense incurred by reason of willful misfeasance, bad faith or gross
negligence on the part of the trustee in the performance of its obligations and
duties under the related Governing Document.
No trustee for any series of offered certificates will be liable for any
action taken, suffered or omitted by it in good faith and believed by it to be
authorized or permitted under the related Governing Document.
No trustee for any series of offered certificates will be required to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties under the related Governing Document, or in the
exercise of any of its rights or
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powers, if it has reasonable grounds for believing that repayment of those funds
or adequate indemnity against that risk or liability is not reasonably assured
to it.
The trustee for each series of offered certificates will be entitled to
execute any of its trusts or powers and perform any of its duties under the
related Governing Document, either directly or by or through agents or
attorneys. The trustee will not be responsible for any willful misconduct or
gross negligence on the part of any agent or attorney appointed by it with due
care.
RESIGNATION AND REMOVAL OF THE TRUSTEE
The trustee for any series of offered certificates may resign at any time.
We will be obligated to appoint a successor to a resigning trustee. We may also
remove the trustee for any series of offered certificates if that trustee ceases
to be eligible to continue as such under the related Governing Document or if
that trustee becomes insolvent. Unless we indicate otherwise in the related
prospectus supplement, the trustee for any series of offered certificates may
also be removed at any time by the holders of the offered and non-offered
certificates of that series evidencing not less than 51%, or any other
percentage specified in the related prospectus supplement, of the voting rights
for that series. However, if the removal was without cause, the
certificateholders effecting the removal may be responsible for any costs and
expenses incurred by the terminated trustee in connection with its removal. Any
resignation or removal of a trustee and appointment of a successor trustee will
not become effective until acceptance of the appointment by the successor
trustee.
DESCRIPTION OF CREDIT SUPPORT
GENERAL
Credit support may be provided with respect to one or more classes of the
offered certificates of any series or with respect to the related mortgage
assets. That credit support may be in the form of any of the following:
- the subordination of one or more other classes of certificates of the
same series;
- the use of a letter of credit, a surety bond, an insurance policy, a
guarantee or a credit derivative;
- the establishment of one or more reserve funds; or
- any combination of the foregoing.
If and to the extent described in the related prospectus supplement, any of
the above forms of credit support may provide credit enhancement for non-offered
certificates, as well as offered certificates, or for more than one series of
certificates.
If you are the beneficiary of any particular form of credit support, that
credit support may not protect you against all risks of loss and will not
guarantee payment to you of all amounts to which you are entitled under your
offered certificates. If losses or shortfalls occur that exceed the amount
covered by that credit support or that are of a
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type not covered by that credit support, you will bear your allocable share of
deficiencies. Moreover, if that credit support covers the offered certificates
of more than one class or series and total losses on the related mortgage assets
exceed the amount of that credit support, it is possible that the holders of
offered certificates of other classes and/or series will be disproportionately
benefited by that credit support to your detriment.
If you are the beneficiary of any particular form of credit support, we
will include in the related prospectus supplement a description of the
following:
- the nature and amount of coverage under that credit support;
- any conditions to payment not otherwise described in this prospectus;
- any conditions under which the amount of coverage under that credit
support may be reduced and under which that credit support may be
terminated or replaced; and
- the material provisions relating to that credit support.
Additionally, we will set forth in the related prospectus supplement
information with respect to the obligor, if any, under any instrument of credit
support.
SUBORDINATE CERTIFICATES
If and to the extent described in the related prospectus supplement, one or
more classes of certificates of any series may be subordinate to one or more
other classes of certificates of that series. If you purchase subordinate
certificates, your right to receive payments out of collections and advances on
the related trust assets on any payment date will be subordinated to the
corresponding rights of the holders of the more senior classes of certificates.
If and to the extent described in the related prospectus supplement, the
subordination of a class of certificates may not cover all types of losses or
shortfalls. In the related prospectus supplement, we will set forth information
concerning the method and amount of subordination provided by a class or classes
of subordinate certificates in a series and the circumstances under which that
subordination will be available.
If the mortgage assets in any trust established us are divided into
separate groups, each supporting a separate class or classes of certificates of
the related series, credit support may be provided by cross-support provisions
requiring that payments be made on senior certificates evidencing interests in
one group of those mortgage assets prior to payments on subordinate certificates
evidencing interests in a different group of those mortgage assets. We will
describe in the related prospectus supplement the manner and conditions for
applying any cross-support provisions.
INSURANCE OR GUARANTEES WITH RESPECT TO MORTGAGE LOANS
The mortgage loans included in any trust established by us may be covered
for some default risks by insurance policies or guarantees. If so, we will
describe in the related prospectus supplement the nature of those default risks
and the extent of that coverage.
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LETTERS OF CREDIT
If and to the extent described in the related prospectus supplement,
deficiencies in amounts otherwise payable on a series of offered certificates or
select classes of those certificates will be covered by one or more letters of
credit, issued by a bank or other financial institution specified in the related
prospectus supplement. The issuer of a letter of credit will be obligated to
honor draws under that letter of credit in a total fixed dollar amount, net of
unreimbursed payments under the letter of credit, generally equal to a
percentage specified in the related prospectus supplement of the total principal
balance of some or all of the related mortgage assets as of the date the related
trust was formed or of the initial total principal balance of one or more
classes of certificates of the applicable series. The letter of credit may
permit draws only in the event of select types of losses and shortfalls. The
amount available under the letter of credit will, in all cases, be reduced to
the extent of the unreimbursed payments thereunder and may otherwise be reduced
as described in the related prospectus supplement. The obligations of the letter
of credit issuer under the letter of credit for any series of offered
certificates will expire at the earlier of the date specified in the related
prospectus supplement or the termination of the related trust.
CERTIFICATE INSURANCE AND SURETY BONDS
If and to the extent described in the related prospectus supplement,
deficiencies in amounts otherwise payable on a series of offered certificates or
select classes of those certificates will be covered by insurance policies or
surety bonds provided by one or more insurance companies or sureties. Those
instruments may cover, with respect to one or more classes of the offered
certificates of the related series, timely payments of interest and principal or
timely payments of interest and payments of principal on the basis of a schedule
of principal payments set forth in or determined in the manner specified in the
related prospectus supplement. We will describe in the related prospectus
supplement any limitations on the draws that may be made under any of those
instruments.
CREDIT DERIVATIVES
If and to the extent described in the related prospectus supplement,
deficiencies in amounts otherwise payable on a series of offered certificates or
select classes of those certificates will be covered by credit derivatives, such
as credit default swaps and total return swaps. A credit derivative is a
financial instrument designed to offset losses and shortfalls derived from the
credit risk of an underlying or reference asset or the credit risk of an
underlying or reference credit. We will describe in the related prospectus
supplement when and how payments are made under the particular instrument and
the specific credit risk that is being covered.
RESERVE FUNDS
If and to the extent described in the related prospectus supplement,
deficiencies in amounts otherwise payable on a series of offered certificates or
select classes of those certificates will be covered, to the extent of available
funds, by one or more reserve funds
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in which cash, a letter of credit, permitted investments, a demand note or a
combination of the foregoing, will be deposited, in the amounts specified in the
related prospectus supplement. If and to the extent described in the related
prospectus supplement, the reserve fund for the related series of offered
certificates may also be funded over time.
Amounts on deposit in any reserve fund for a series of offered certificates
will be applied for the purposes, in the manner, and to the extent specified in
the related prospectus supplement. If and to the extent described in the related
prospectus supplement, reserve funds may be established to provide protection
only against select types of losses and shortfalls. Following each payment date
for the related series of offered certificates, amounts in a reserve fund in
excess of any required balance may be released from the reserve fund under the
conditions and to the extent specified in the related prospectus supplement.
CREDIT SUPPORT WITH RESPECT TO MBS
If and to the extent described in the related prospectus supplement, any
mortgage-backed security included in one of our trusts and/or the mortgage loans
that back that security may be covered by one or more of the types of credit
support described in this prospectus. We will specify in the related prospectus
supplement, as to each of those forms of credit support, the information
indicated above with respect to that mortgage-backed security, to the extent
that the information is material and available.
LEGAL ASPECTS OF MORTGAGE LOANS
Most, if not all, of the mortgage loans underlying a series of offered
certificates will be secured by multifamily and commercial properties in the
United States, its territories and possessions. However, some of those mortgage
loans may be secured by multifamily and commercial properties outside the United
States, its territories and possessions.
The following discussion contains general summaries of select legal aspects
of mortgage loans secured by multifamily and commercial properties in the United
States. Because these legal aspects are governed by applicable state law, which
may differ substantially from state to state, the summaries do not purport to be
complete, to reflect the laws of any particular state, or to encompass the laws
of all jurisdictions in which the security for the mortgage loans underlying the
offered certificates is situated. Accordingly, you should be aware that the
summaries are qualified in their entirety by reference to the applicable laws of
those states. See "Description of the Trust Assets--Mortgage Loans."
If a significant percentage of mortgage loans underlying a series of
offered certificates, are secured by properties in a particular state, we will
discuss the relevant state laws, to the extent they vary materially from this
discussion, in the related prospectus supplement.
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GENERAL
Each mortgage loan underlying a series of offered certificates will be
evidenced by a note or bond and secured by an instrument granting a security
interest in real property. The instrument granting a security interest in real
property may be a mortgage, deed of trust or a deed to secure debt, depending
upon the prevailing practice and law in the state in which that real property is
located. Mortgages, deeds of trust and deeds to secure debt are often
collectively referred to in this prospectus as "mortgages." A mortgage creates a
lien upon, or grants a title interest in, the real property covered by the
mortgage, and represents the security for the repayment of the indebtedness
customarily evidenced by a promissory note. The priority of the lien created or
interest granted will depend on--
- the terms of the mortgage,
- the terms of separate subordination agreements or intercreditor
agreements with others that hold interests in the real property,
- the knowledge of the parties to the mortgage, and
- in general, the order of recordation of the mortgage in the appropriate
public recording office.
However, the lien of a recorded mortgage will generally be subordinate to
later-arising liens for real estate taxes and assessments and other charges
imposed under governmental police powers.
TYPES OF MORTGAGE INSTRUMENTS
There are two parties to a mortgage--
- a mortgagor, who is the owner of the encumbered interest in the real
property, and
- a mortgagee, who is the lender.
In general, the mortgagor is also the borrower.
In contrast, a deed of trust is a three-party instrument. The parties to a
deed of trust are--
- the trustor, who is the equivalent of a mortgagor,
- the trustee to whom the real property is conveyed, and
- the beneficiary for whose benefit the conveyance is made, who is the
lender.
Under a deed of trust, the trustor grants the property, irrevocably until
the debt is paid, in trust and generally with a power of sale, to the trustee to
secure repayment of the indebtedness evidenced by the related note.
A deed to secure debt typically has two parties. Under a deed to secure
debt, the grantor, who is the equivalent of a mortgagor, conveys title to the
real property to the grantee, who is the lender, generally with a power of sale,
until the debt is repaid.
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Where the borrower is a land trust, there would be an additional party
because legal title to the property is held by a land trustee under a land trust
agreement for the benefit of the borrower. At origination of a mortgage loan
involving a land trust, the borrower may execute a separate undertaking to make
payments on the mortgage note. In no event is the land trustee personally liable
for the mortgage note obligation.
The mortgagee's authority under a mortgage, the trustee's authority under a
deed of trust and the grantee's authority under a deed to secure debt are
governed by:
- the express provisions of the related instrument,
- the law of the state in which the real property is located,
- various federal laws, and
- in some deed of trust transactions, the directions of the beneficiary.
LEASES AND RENTS
A mortgage that encumbers an income-producing property often contains an
assignment of rents and leases and/or may be accompanied by a separate
assignment of rents and leases. Under an assignment of rents and leases, the
borrower assigns to the lender the borrower's right, title and interest as
landlord under each lease and the income derived from each lease. However, the
borrower retains a revocable license to collect the rents, provided there is no
default and the rents are not directly paid to the lender. If the borrower
defaults, the license terminates and the lender is entitled to collect the
rents. Local law may require that the lender take possession of the property
and/or obtain a court-appointed receiver before becoming entitled to collect the
rents.
In most states, hotel and motel room rates are considered accounts
receivable under the UCC. Room rates are generally pledged by the borrower as
additional security for the loan when a mortgage loan is secured by a hotel or
motel. In general, the lender must file financing statements in order to perfect
its security interest in the room rates and must file continuation statements,
generally every five years, to maintain that perfection. Mortgage loans secured
by hotels or motels may be included in one of our trusts even if the security
interest in the room rates was not perfected or the requisite UCC filings were
allowed to lapse. A lender will generally be required to commence a foreclosure
action or otherwise take possession of the property in order to enforce its
rights to collect the room rates following a default, even if the lender's
security interest in room rates is perfected under applicable nonbankruptcy law.
In the bankruptcy setting, the lender will be stayed from enforcing its
rights to collect hotel and motel room rates. However, the room rates will
constitute cash collateral and cannot be used by the bankrupt borrower--
- without a hearing or the lender's consent, or
- unless the lender's interest in the room rates is given adequate
protection.
For purposes of the foregoing, the adequate protection may include a cash
payment for otherwise encumbered funds or a replacement lien on unencumbered
property, in
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either case equal in value to the amount of room rates that the bankrupt
borrower proposes to use. See "--Bankruptcy Laws" below.
PERSONALTY
Some types of income-producing real properties, such as hotels, motels and
nursing homes, may include personal property, which may, to the extent it is
owned by the borrower and not previously pledged, constitute a significant
portion of the property's value as security. The creation and enforcement of
liens on personal property are governed by the UCC. Accordingly, if a borrower
pledges personal property as security for a mortgage loan, the lender generally
must file UCC financing statements in order to perfect its security interest in
the personal property and must file continuation statements, generally every
five years, to maintain that perfection. Mortgage loans secured in part by
personal property may be included in one of our trusts even if the security
interest in the personal property was not perfected or the requisite UCC filings
were allowed to lapse.
FORECLOSURE
General. Foreclosure is a legal procedure that allows the lender to
recover its mortgage debt by enforcing its rights and available legal remedies
under the mortgage. If the borrower defaults in payment or performance of its
obligations under the note or mortgage, the lender has the right to institute
foreclosure proceedings to sell the real property security at public auction to
satisfy the indebtedness.
Foreclosure Procedures Vary From State to State. The two primary methods
of foreclosing a mortgage are--
- judicial foreclosure, involving court proceedings, and
- nonjudicial foreclosure under a power of sale granted in the mortgage
instrument.
Other foreclosure procedures are available in some states, but they are
either infrequently used or available only in limited circumstances.
A foreclosure action is subject to most of the delays and expenses of other
lawsuits if defenses are raised or counterclaims are interposed. A foreclosure
action sometimes requires several years to complete.
Judicial Foreclosure. A judicial foreclosure proceeding is conducted in a
court having jurisdiction over the mortgaged property. Generally, a lender
initiates the action by the service of legal pleadings upon--
- all parties having a subordinate interest of record in the real property,
and
- all parties in possession of the property, under leases or otherwise,
whose interests are subordinate to the mortgage.
Delays in completion of the foreclosure may occasionally result from
difficulties in locating defendants. When the lender's right to foreclose is
contested, the legal proceedings can be time-consuming. The court generally
issues a judgment of foreclosure
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and appoints a referee or other officer to conduct a public sale of the
mortgaged property upon successful completion of a judicial foreclosure
proceeding. The proceeds of that public sale are used to satisfy the judgment.
The procedures that govern these public sales vary from state to state.
Equitable and Other Limitations on Enforceability of Particular
Provisions. United States courts have traditionally imposed general equitable
principles to limit the remedies available to lenders in foreclosure actions.
These principles are generally designed to relieve borrowers from the effects of
mortgage defaults perceived as harsh or unfair. Relying on these principles, a
court may:
- alter the specific terms of a loan to the extent it considers necessary
to prevent or remedy an injustice, undue oppression or overreaching;
- require the lender to undertake affirmative actions to determine the
cause of the borrower's default and the likelihood that the borrower will
be able to reinstate the loan;
- require the lender to reinstate a loan or recast a payment schedule in
order to accommodate a borrower that is suffering from a temporary
financial disability; or
- limit the right of the lender to foreclose in the case of a nonmonetary
default, such as--
1. a failure to adequately maintain the mortgaged property, or
2. an impermissible further encumbrance of the mortgaged property.
Some courts have addressed the issue of whether federal or state
constitutional provisions reflecting due process concerns for adequate notice
require that a borrower receive notice in addition to statutorily-prescribed
minimum notice. For the most part, these cases have--
- upheld the reasonableness of the notice provisions, or
- found that a public sale under a mortgage providing for a power of sale
does not involve sufficient state action to trigger constitutional
protections.
In addition, some states may have statutory protection such as the right of
the borrower to reinstate its mortgage loan after commencement of foreclosure
proceedings but prior to a foreclosure sale.
Nonjudicial Foreclosure/Power of Sale. In states permitting nonjudicial
foreclosure proceedings, foreclosure of a deed of trust is generally
accomplished by a nonjudicial trustee's sale under a power of sale typically
granted in the deed of trust. A power of sale may also be contained in any other
type of mortgage instrument if applicable law so permits. A power of sale under
a deed of trust allows a nonjudicial public sale to be conducted generally
following--
- a request from the beneficiary/lender to the trustee to sell the property
upon default by the borrower, and
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- notice of sale is given in accordance with the terms of the deed of trust
and applicable state law.
In some states, prior to a nonjudicial public sale, the trustee under the
deed of trust must--
- record a notice of default and notice of sale, and
- send a copy of those notices to the borrower and to any other party who
has recorded a request for a copy of them.
In addition, in some states, the trustee must provide notice to any other party
having an interest of record in the real property, including junior lienholders.
A notice of sale must be posted in a public place and, in most states, published
for a specified period of time in one or more newspapers. Some states require a
reinstatement period during which the borrower or junior lienholder may have the
right to cure the default by paying the entire actual amount in arrears, without
regard to the acceleration of the indebtedness, plus the lender's expenses
incurred in enforcing the obligation. In other states, the borrower or the
junior lienholder has only the right to pay off the entire debt to prevent the
foreclosure sale. Generally, state law governs the procedure for public sale,
the parties entitled to notice, the method of giving notice and the applicable
time periods.
Public Sale. A third party may be unwilling to purchase a mortgaged
property at a public sale because of--
- the difficulty in determining the exact status of title to the property
due to, among other things, redemption rights that may exist, and
- the possibility that physical deterioration of the property may have
occurred during the foreclosure proceedings.
As a result of the foregoing, it is common for the lender to purchase the
mortgaged property and become its owner, subject to the borrower's right in some
states to remain in possession during a redemption period. In that case, the
lender will have both the benefits and burdens of ownership, including the
obligation to pay debt service on any senior mortgages, to pay taxes, to obtain
casualty insurance and to make repairs necessary to render the property suitable
for sale. The costs of operating and maintaining a commercial or multifamily
residential property may be significant and may be greater than the income
derived from that property. The lender also will commonly obtain the services of
a real estate broker and pay the broker's commission in connection with the sale
or lease of the property. Whether, the ultimate proceeds of the sale of the
property equal the lender's investment in the property depends upon market
conditions. Moreover, because of the expenses associated with acquiring, owning
and selling a mortgaged property, a lender could realize an overall loss on the
related mortgage loan even if the mortgaged property is sold at foreclosure, or
resold after it is acquired through foreclosure, for an amount equal to the full
outstanding principal amount of the loan plus accrued interest.
The holder of a junior mortgage that forecloses on a mortgaged property
does so subject to senior mortgages and any other prior liens. In addition, it
may be obliged to
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keep senior mortgage loans current in order to avoid foreclosure of its interest
in the property. Furthermore, if the foreclosure of a junior mortgage triggers
the enforcement of a due-on-sale clause contained in a senior mortgage, the
junior mortgagee could be required to pay the full amount of the senior mortgage
indebtedness or face foreclosure.
Rights of Redemption. The purposes of a foreclosure action are--
- to enable the lender to realize upon its security, and
- to bar the borrower, and all persons who have interests in the property
that are subordinate to that of the foreclosing lender, from exercising
their equity of redemption.
The doctrine of equity of redemption provides that, until the property
encumbered by a mortgage has been sold in accordance with a properly conducted
foreclosure and foreclosure sale, those having interests that are subordinate to
that of the foreclosing lender have an equity of redemption and may redeem the
property by paying the entire debt with interest. Those having an equity of
redemption must generally be made parties to the foreclosure proceeding in order
for their equity of redemption to be terminated.
The equity of redemption is a common-law, nonstatutory right which should
be distinguished from post-sale statutory rights of redemption. In some states,
the borrower and foreclosed junior lienors are given a statutory period in which
to redeem the property after sale under a deed of trust or foreclosure of a
mortgage. In some states, statutory redemption may occur only upon payment of
the foreclosure sale price. In other states, redemption may be permitted if the
former borrower pays only a portion of the sums due. A statutory right of
redemption will diminish the ability of the lender to sell the foreclosed
property because the exercise of a right of redemption would defeat the title of
any purchaser through a foreclosure. Consequently, the practical effect of the
redemption right is to force the lender to maintain the property and pay the
expenses of ownership until the redemption period has expired. In some states, a
post-sale statutory right of redemption may exist following a judicial
foreclosure, but not following a trustee's sale under a deed of trust.
Anti-Deficiency Legislation. Some or all of the mortgage loans underlying
a series of offered certificates may be nonrecourse loans. Recourse in the case
of a default on a non-recourse mortgage loan will be limited to the mortgaged
property and any other assets that were pledged to secure the mortgage loan.
However, even if a mortgage loan by its terms provides for recourse to the
borrower's other assets, a lender's ability to realize upon those assets may be
limited by state law. For example, in some states, a lender cannot obtain a
deficiency judgment against the borrower following foreclosure or sale under a
deed of trust. A deficiency judgment is a personal judgment against the former
borrower equal to the difference between the net amount realized upon the public
sale of the real property and the amount due to the lender. Other statutes may
require the lender to exhaust the security afforded under a mortgage before
bringing a personal action against the borrower. In other states, the lender has
the option of bringing a personal action against the borrower on the debt
without first exhausting the security, but in doing so, the lender may be deemed
to have elected a remedy and thus may be
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precluded from foreclosing upon the security. Consequently, lenders will usually
proceed first against the security in states where an election of remedy
provision exists. Finally, other statutory provisions limit any deficiency
judgment to the excess of the outstanding debt over the fair market value of the
property at the time of the sale. These other statutory provisions are intended
to protect borrowers from exposure to large deficiency judgments that might
result from bidding at below-market values at the foreclosure sale.
Leasehold Considerations. Some or all of the mortgage loans underlying a
series of offered certificates may be secured by a mortgage on the borrower's
leasehold interest under a ground lease. Leasehold mortgage loans are subject to
some risks not associated with mortgage loans secured by a lien on the fee
estate of the borrower. The most significant of these risks is that if the
borrower's leasehold were to be terminated upon a lease default, the leasehold
mortgagee would lose its security. This risk may be lessened if the ground
lease:
- requires the lessor to give the leasehold mortgagee notices of lessee
defaults and an opportunity to cure them,
- permits the leasehold estate to be assigned to and by the leasehold
mortgagee or the purchaser at a foreclosure sale, and
- contains other protective provisions typically required by prudent
lenders to be included in a ground lease.
Some mortgage loans underlying a series of offered certificates, however,
may be secured by ground leases which do not contain these provisions.
Cooperative Shares. Some or all of the mortgage loans underlying a series
of offered certificates may be secured by a security interest on the borrower's
ownership interest in shares, and the proprietary leases belonging to those
shares, allocable to cooperative dwelling units that may be vacant or occupied
by nonowner tenants. Loans secured in this manner are subject to some risks not
associated with mortgage loans secured by a lien on the fee estate of a borrower
in real property. Loans secured in this manner typically are subordinate to the
mortgage, if any, on the cooperative's building. That mortgage, if foreclosed,
could extinguish the equity in the building and the proprietary leases of the
dwelling units derived from ownership of the shares of the cooperative. Further,
transfer of shares in a cooperative is subject to various regulations as well as
to restrictions under the governing documents of the cooperative. The shares may
be canceled in the event that associated maintenance charges due under the
related proprietary leases are not paid. Typically, a recognition agreement
between the lender and the cooperative provides, among other things, that the
lender may cure a default under a proprietary lease.
Under the laws applicable in many states, "foreclosure" on cooperative
shares is accomplished by a sale in accordance with the provisions of Article 9
of the UCC and the security agreement relating to the shares. Article 9 of the
UCC requires that a sale be conducted in a commercially reasonable manner, which
may be dependent upon, among other things, the notice given the debtor and the
method, manner, time, place and terms of the sale. Article 9 of the UCC provides
that the proceeds of the sale will
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be applied first to pay the costs and expenses of the sale and then to satisfy
the indebtedness secured by the lender's security interest. A recognition
agreement, however, generally provides that the lender's right to reimbursement
is subject to the right of the cooperative corporation to receive sums due under
the proprietary leases.
BANKRUPTCY LAWS
Operation of the U.S. Bankruptcy Code and related state laws may interfere
with or affect the ability of a lender to realize upon collateral or to enforce
a deficiency judgment. For example, under the U.S. Bankruptcy Code, virtually
all actions, including foreclosure actions and deficiency judgment proceedings,
to collect a debt are automatically stayed upon the filing of the bankruptcy
petition. Often, no interest or principal payments are made during the course of
the bankruptcy case. The delay caused by an automatic stay and its consequences
can be significant. Also, under the U.S. Bankruptcy Code, the filing of a
petition in bankruptcy by or on behalf of a junior lienor may stay the senior
lender from taking action to foreclose out the junior lien.
Under the U.S. Bankruptcy Code, the amount and terms of a mortgage loan
secured by a lien on property of the debtor may be modified provided that
substantive and procedural safeguards protective of the lender are met. A
bankruptcy court may, among other things--
- reduce the secured portion of the outstanding amount of the loan to the
then-current value of the property, thereby leaving the lender a general
unsecured creditor for the difference between the then-current value of
the property and the outstanding balance of the loan;
- reduce the amount of each scheduled payment, by means of a reduction in
the rate of interest and/or an alteration of the repayment schedule, with
or without affecting the unpaid principal balance of the loan;
- extend or shorten the term to maturity of the loan;
- permit the bankrupt borrower to cure of the subject loan default by
paying the arrearage over a number of years; or
- permit the bankrupt borrower, through its rehabilitative plan, to
reinstate the loan payment schedule even if the lender has obtained a
final judgment of foreclosure prior to the filing of the debtor's
petition.
Federal bankruptcy law may also interfere with or affect the ability of a
secured lender to enforce the borrower's assignment of rents and leases related
to the mortgaged property. A lender may be stayed from enforcing the assignment
under the U.S. Bankruptcy Code. In addition, the legal proceedings necessary to
resolve the issue could be time-consuming, and result in delays in the lender's
receipt of the rents. However, recent amendments to the U.S. Bankruptcy Code may
minimize the impairment of the lender's ability to enforce the borrower's
assignment of rents and leases. In addition to the inclusion of hotel revenues
within the definition of cash collateral as noted above, the amendments provide
that a pre-petition security interest in rents or hotel revenues is
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designed to overcome those cases holding that a security interest in rents is
unperfected under the laws of some states until the lender has taken some
further action, such as commencing foreclosure or obtaining a receiver prior to
activation of the assignment of rents.
A borrower's ability to make payment on a mortgage loan may be impaired by
the commencement of a bankruptcy case relating to the tenant under a lease of
the related property. Under the U.S. Bankruptcy Code, the filing of a petition
in bankruptcy by or on behalf of a tenant results in a stay in bankruptcy
against the commencement or continuation of any state court proceeding for--
- past due rent,
- accelerated rent,
- damages, or
- a summary eviction order with respect to a default under the lease that
occurred prior to the filing of the tenant's bankruptcy petition.
In addition, the U.S. Bankruptcy Code generally provides that a trustee or
debtor-in-possession may, subject to approval of the court:
- assume the lease and either retain it or assign it to a third party, or
- reject the lease.
If the lease is assumed, the trustee, debtor-in-possession or assignee, if
applicable, must cure any defaults under the lease, compensate the lessor for
its losses and provide the lessor with adequate assurance of future performance.
These remedies may be insufficient, and any assurances provided to the lessor
may be inadequate. If the lease is rejected, the lessor will be treated, except
potentially to the extent of any security deposit, as an unsecured creditor with
respect to its claim for damages for termination of the lease. The U.S.
Bankruptcy Code also limits a lessor's damages for lease rejection to:
- the rent reserved by the lease without regard to acceleration for the
greater of one year, or 15%, not to exceed three years, of the remaining
term of the lease, plus
- unpaid rent to the earlier of the surrender of the property or the
lessee's bankruptcy filing.
ENVIRONMENTAL CONSIDERATIONS
General. A lender may be subject to environmental risks when taking a
security interest in real property. Of particular concern may be properties that
are or have been used for industrial, manufacturing, military or disposal
activity. Those environmental risks include the possible diminution of the value
of a contaminated property or, as discussed below, potential liability for
clean-up costs or other remedial actions that could exceed the value of the
property or the amount of the lender's loan. In some circumstances, a lender may
decide to abandon a contaminated real property as collateral for its loan rather
than foreclose and risk liability for clean-up costs.
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Superlien Laws. Under the laws of many states, contamination on a
property may give rise to a lien on the property for clean-up costs. In several
states, that lien has priority over all existing liens, including those of
existing mortgages. In these states, the lien of a mortgage may lose its
priority to that superlien.
CERCLA. The federal Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, imposes strict liability on present and
past "owners" and "operators" of contaminated real property for the costs of
clean-up. A secured lender may be liable as an "owner" or "operator" of a
contaminated mortgaged property if agents or employees of the lender have
participated in the management of the property or the operations of the
borrower. Liability may exist even if the lender did not cause or contribute to
the contamination and regardless of whether the lender has actually taken
possession of the contaminated mortgaged property through foreclosure, deed in
lieu of foreclosure or otherwise. Moreover, liability is not limited to the
original or unamortized principal balance of a loan or to the value of the
property securing a loan. Excluded from CERCLA's definition of "owner" or
"operator," however, is a person who, without participating in the management of
the facility, holds indicia of ownership primarily to protect his security
interest. This is the so called "secured creditor exemption."
The Asset Conservation, Lender Liability and Deposit Insurance Act of 1996
amended, among other things, the provisions of CERCLA with respect to lender
liability and the secured creditor exemption. The Lender Liability Act offers
substantial protection to lenders by defining the activities in which a lender
can engage and still have the benefit of the secured creditor exemption. In
order for a lender to be deemed to have participated in the management of a
mortgaged property, the lender must actually participate in the operational
affairs of the property of the borrower. The Lender Liability Act provides that
"merely having the capacity to influence, or unexercised right to control"
operations does not constitute participation in management. A lender will lose
the protection of the secured creditor exemption only if--
- it exercises decision-making control over a borrower's environmental
compliance and hazardous substance handling and disposal practices, or
- assumes day-to-day management of operational functions of a mortgaged
property.
The Lender Liability Act also provides that a lender will continue to have
the benefit of the secured creditor exemption even if it forecloses on a
mortgaged property, purchases it at a foreclosure sale or accepts a deed-in-lieu
of foreclosure, provided that the lender seeks to sell that property at the
earliest practicable commercially reasonable time on commercially reasonable
terms.
Other Federal and State Laws. Many states have statutes similar to
CERCLA, and not all those statutes provide for a secured creditor exemption. In
addition, under federal law, there is potential liability relating to hazardous
wastes and underground storage tanks under the federal Resource Conservation and
Recovery Act.
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Some federal, state and local laws, regulations and ordinances govern the
management, removal, encapsulation or disturbance of asbestos-containing
materials. These laws, as well as common law standards, may--
- impose liability for releases of or exposure to asbestos-containing
materials, and
- provide for third parties to seek recovery from owners or operators of
real properties for personal injuries associated with those releases.
Federal law requires owners of residential housing constructed prior to
1978 to disclose to potential residents or purchasers any known lead-based paint
hazards and will impose treble damages for any failure to disclose. In addition,
the ingestion of lead-based paint chips or dust particles by children can result
in lead poisoning. If lead-based paint hazards exist at a property, then the
owner of that property may be held liable for injuries and for the costs of
removal or encapsulation of the lead-based paint.
In a few states, transfers of some types of properties are conditioned upon
cleanup of contamination prior to transfer. In these cases, a lender that
becomes the owner of a property through foreclosure, deed in lieu of foreclosure
or otherwise, may be required to clean up the contamination before selling or
otherwise transferring the property.
Beyond statute-based environmental liability, there exist common law causes
of action related to hazardous environmental conditions on a property, such as
actions based on nuisance or on toxic tort resulting in death, personal injury
or damage to property. While it may be more difficult to hold a lender liable
under common law causes of action, unanticipated or uninsured liabilities of the
borrower may jeopardize the borrower's ability to meet its loan obligations.
Federal, state and local environmental regulatory requirements change
often. It is possible that compliance with a new regulatory requirement could
impose significant compliance costs on a borrower. These costs may jeopardize
the borrower's ability to meet its loan obligations.
Additional Considerations. The cost of remediating hazardous substance
contamination at a property can be substantial. If a lender becomes liable, it
can bring an action for contribution against the owner or operator who created
the environmental hazard. However, that individual or entity may be without
substantial assets. Accordingly, it is possible that the costs could become a
liability of the related trust and occasion a loss to the related
certificateholders.
If the operations on a foreclosed property are subject to environmental
laws and regulations, the lender will be required to operate the property in
accordance with those laws and regulations. This compliance may entail
substantial expense, especially in the case of industrial or manufacturing
properties.
In addition, a lender may be obligated to disclose environmental conditions
on a property to government entities and/or to prospective buyers, including
prospective buyers at a foreclosure sale or following foreclosure. This
disclosure may decrease the amount that prospective buyers are willing to pay
for the affected property, sometimes substantially.
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DUE-ON-SALE AND DUE-ON-ENCUMBRANCE PROVISIONS
Some or all of the mortgage loans underlying a series of offered
certificates may contain due-on-sale and due-on-encumbrance clauses that purport
to permit the lender to accelerate the maturity of the loan if the borrower
transfers or encumbers the a mortgaged property. In recent years, court
decisions and legislative actions placed substantial restrictions on the right
of lenders to enforce these clauses in many states. However, the Garn-St Germain
Depository Institutions Act of 1982 generally preempts state laws that prohibit
the enforcement of due-on-sale clauses and permits lenders to enforce these
clauses in accordance with their terms, subject to the limitations prescribed in
that Act and the regulations promulgated thereunder.
JUNIOR LIENS; RIGHTS OF HOLDERS OF SENIOR LIENS
Any of our trusts may include mortgage loans secured by junior liens, while
the loans secured by the related senior liens may not be included in that trust.
The primary risk to holders of mortgage loans secured by junior liens is the
possibility that adequate funds will not be received in connection with a
foreclosure of the related senior liens to satisfy fully both the senior loans
and the junior loan.
In the event that a holder of a senior lien forecloses on a mortgaged
property, the proceeds of the foreclosure or similar sale will be applied as
follows:
- first, to the payment of court costs and fees in connection with the
foreclosure;
- second, to real estate taxes;
- third, in satisfaction of all principal, interest, prepayment or
acceleration penalties, if any, and any other sums due and owing to the
holder of the senior liens; and
- last, in satisfaction of all principal, interest, prepayment and
acceleration penalties, if any, and any other sums due and owing to the
holder of the junior mortgage loan.
SUBORDINATE FINANCING
Some mortgage loans underlying a series of offered certificates may not
restrict the ability of the borrower to use the mortgaged property as security
for one or more additional loans, or the restrictions may be unenforceable.
Where a borrower encumbers a mortgaged property with one or more junior liens,
the senior lender is subjected to the following additional risks:
- the borrower may have difficulty servicing and repaying multiple loans;
- if the subordinate financing permits recourse to the borrower, as is
frequently the case, and the senior loan does not, a borrower may have
more incentive to repay sums due on the subordinate loan;
- acts of the senior lender that prejudice the junior lender or impair the
junior lender's security, such as the senior lender's agreeing to an
increase in the
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principal amount of or the interest rate payable on the senior loan, may
create a superior equity in favor of the junior lender;
- if the borrower defaults on the senior loan and/or any junior loan or
loans, the existence of junior loans and actions taken by junior lenders
can impair the security available to the senior lender and can interfere
with or delay the taking of action by the senior lender; and
- the bankruptcy of a junior lender may operate to stay foreclosure or
similar proceedings by the senior lender.
DEFAULT INTEREST AND LIMITATIONS ON PREPAYMENTS
Notes and mortgages may contain provisions that obligate the borrower to
pay a late charge or additional interest if payments are not timely made. They
may also contain provisions that prohibit prepayments for a specified period
and/or condition prepayments upon the borrower's payment of prepayment premium,
fee or charge. In some states, there are or may be specific limitations upon the
late charges that a lender may collect from a borrower for delinquent payments.
Some states also limit the amounts that a lender may collect from a borrower as
an additional charge if the loan is prepaid. In addition, the enforceability of
provisions that provide for prepayment premiums, fees and charges upon an
involuntary prepayment is unclear under the laws of many states.
APPLICABILITY OF USURY LAWS
Title V of the Depository Institutions Deregulation and Monetary Control
Act of 1980 provides that state usury limitations shall not apply to various
types of residential, including multifamily, first mortgage loans originated by
particular lenders after March 31, 1980. Title V authorized any state to
reimpose interest rate limits by adopting, before April 1, 1983, a law or
constitutional provision that expressly rejects application of the federal law.
In addition, even where Title V is not rejected, any state is authorized by the
law to adopt a provision limiting discount points or other charges on mortgage
loans covered by Title V. Some states have taken action to reimpose interest
rate limits and/or to limit discount points or other charges.
AMERICANS WITH DISABILITIES ACT
Under Title III of the Americans with Disabilities Act of 1990 and rules
promulgated thereunder, in order to protect individuals with disabilities,
owners of public accommodations, such as hotels, restaurants, shopping centers,
hospitals, schools and social service center establishments, must remove
architectural and communication barriers which are structural in nature from
existing places of public accommodation to the extent "readily achievable." In
addition, under the ADA, alterations to a place of public accommodation or a
commercial facility are to be made so that, to the maximum extent feasible, the
altered portions are readily accessible to and usable by disabled individuals.
The "readily achievable" standard takes into account, among other factors, the
financial resources of the affected property owner, landlord or other applicable
person. In addition to imposing a possible financial burden on the borrower in
its
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capacity as owner or landlord, the ADA may also impose requirements on a
foreclosing lender who succeeds to the interest of the borrower as owner or
landlord. Furthermore, because the "readily achievable" standard may vary
depending on the financial condition of the owner or landlord, a foreclosing
lender that is financially more capable than the borrower of complying with the
requirements of the ADA may be subject to more stringent requirements than those
to which the borrower is subject.
SOLDIERS' AND SAILORS' CIVIL RELIEF ACT OF 1940
Under the terms of the Soldiers' and Sailors' Civil Relief Act of 1940, as
amended, a borrower who enters military service after the origination of the
borrower's mortgage loan, including a borrower who was in reserve status and is
called to active duty after origination of the mortgage loan, may not be charged
interest, including fees and charges, above an annual rate of 6% during the
period of the borrower's active duty status, unless a court orders otherwise
upon application of the lender. The Relief Act applies to individuals who are
members of the Army, Navy, Air Force, Marines, National Guard, Reserves, Coast
Guard and officers of the U.S. Public Health Service assigned to duty with the
military. Because the Relief Act applies to individuals who enter military
service, including reservists who are called to active duty, after origination
of the related mortgage loan, no information can be provided as to the number of
loans with individuals as borrowers that may be affected by the Relief Act.
Application of the Relief Act would adversely affect, for an indeterminate
period of time, the ability of a master servicer or special servicer to collect
full amounts of interest on an affected mortgage loan. Any shortfalls in
interest collections resulting from the application of the Relief Act would
result in a reduction of the amounts payable to the holders of certificates of
the related series, and would not be covered by advances or, unless otherwise
specified in the related prospectus supplement, any form of credit support
provided in connection with the certificates. In addition, the Relief Act
imposes limitations that would impair the ability of a master servicer or
special servicer to foreclose on an affected mortgage loan during the borrower's
period of active duty status and, under some circumstances, during an additional
three month period after the active duty status ceases.
FORFEITURES IN DRUG AND RICO PROCEEDINGS
Federal law provides that property owned by persons convicted of
drug-related crimes or of criminal violations of the Racketeer Influenced and
Corrupt Organizations statute can be seized by the government if the property
was used in, or purchased with the proceeds of, those crimes. Under procedures
contained in the comprehensive Crime Control Act of 1984, the government may
seize the property even before conviction. The government must publish notice of
the forfeiture proceeding and may give notice to all parties "known to have an
alleged interest in the property," including the holders of mortgage loans.
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A lender may avoid forfeiture of its interest in the property if it
establishes that--
- its mortgage was executed and recorded before commission of the crime
upon which the forfeiture is based, or
- the lender was, at the time of execution of the mortgage, "reasonably
without cause to believe" that the property was used in, or purchased
with the proceeds of, illegal drug or RICO activities.
FEDERAL INCOME TAX CONSEQUENCES
GENERAL
This is a general discussion of the material federal income tax
consequences of owning the offered certificates. This discussion is directed to
certificateholders that hold the offered certificates as capital assets within
the meaning of Section 1221 of the Internal Revenue Code of 1986. It does not
discuss all federal income tax consequences that may be relevant to owners of
offered certificates, particularly as to investors subject to special treatment
under the Internal Revenue Code, including:
- banks,
- insurance companies, and
- foreign investors.
Further, this discussion and any legal opinions referred to in this
discussion are based on authorities that can change, or be differently
interpreted, with possible retroactive effect. No rulings have been or will be
sought from the IRS with respect to any of the federal income tax consequences
discussed below. Accordingly, the IRS may take contrary positions.
Investors and preparers of tax returns should be aware that under
applicable Treasury regulations a provider of advice on specific issues of law
is not considered an income tax return preparer unless the advice is--
- given with respect to events that have occurred at the time the advice is
rendered, and
- is directly relevant to the determination of an entry on a tax return.
Accordingly, even if this discussion addresses an issue regarding the tax
treatment of the owner of the offered certificates, investors should consult
their own tax advisors regarding that issue. Investors should do so not only as
to federal taxes, but also state and local taxes. See "State and Other Tax
Consequences."
The following discussion addresses securities of three general types:
- REMIC certificates, representing interests in a trust, or a portion of
the assets of that trust, as to which a specified person or entity will
make a real estate mortgage investment conduit, or REMIC, election under
Sections 860A through 860G of the Internal Revenue Code;
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- FASIT certificates, representing interests in a trust, or a portion of
the assets of that trust, as to which a specified person or entity will
make a financial asset securitization investment trust, or FASIT,
election within the meaning of Section 860L(a) of the Internal Revenue
Code; and
- grantor trust certificates, representing interests in a trust, or a
portion of the assets of that trust, as to which no REMIC or FASIT
election will be made.
We will indicate in the prospectus supplement for each series of offered
certificates whether the related trustee, another party to the related Governing
Document or an agent appointed by that trustee or other party will act as tax
administrator for the related trust. If the related tax administrator is
required to make a REMIC or FASIT election, we also will identify in the related
prospectus supplement all regular interests, residual interests and/or ownership
interests, as applicable, in the resulting REMIC or FASIT.
The following discussion is limited to certificates offered under this
prospectus. In addition, this discussion applies only to the extent that the
related trust holds only mortgage loans. If a trust holds assets other than
mortgage loans, such as mortgage-backed securities, we will disclose in the
related prospectus supplement the tax consequences associated with those other
assets being included. In addition, if agreements other than guaranteed
investment contracts are included in a trust to provide interest rate protection
for the related offered certificates, the anticipated material tax consequences
associated with those agreements also will be discussed in the related
prospectus supplement. See "Description of the Trust Assets--Arrangements
Providing Reinvestment, Interest Rate and Currency Related Protection."
The following discussion is based in part on the rules governing original
issue discount in Sections 1271-1273 and 1275 of the Internal Revenue Code and
in the Treasury regulations issued under those sections. It is also based in
part on the rules governing REMICs in Sections 860A-860G of the Internal Revenue
Code and in the Treasury regulations issued under those sections. The
regulations relating to original issue discount do not adequately address all
issues relevant to, and in some instances provide that they are not applicable
to, securities such as the offered certificates.
REMICS
General. With respect to each series of offered certificates as to which
the related tax administrator will make a REMIC election, our counsel will
deliver its opinion generally to the effect that, assuming compliance with all
provisions of the related Governing Document, and subject to any other
assumptions set forth in the opinion:
- the related trust, or the relevant designated portion of the trust, will
qualify as a REMIC, and
- those offered certificates will represent--
1. regular interests in the REMIC, or
2. residual interests in the REMIC.
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Any and all offered certificates representing interests in a REMIC will be
either--
- REMIC regular certificates, representing regular interests in the REMIC,
or
- REMIC residual certificates, representing residual interests in the
REMIC.
If an entity electing to be treated as a REMIC fails to comply with the
ongoing requirements of the Internal Revenue Code for REMIC status, it may lose
its REMIC status. If so, the entity may become taxable as a corporation.
Therefore, the related certificates may not be given the tax treatment
summarized below. Although the Internal Revenue Code authorizes the Treasury
Department to issue regulations providing relief in the event of an inadvertent
termination of REMIC status, the Treasury Department has not done so. Any relief
mentioned above, moreover, may be accompanied by sanctions. These sanctions
could include the imposition of a corporate tax on all or a portion of a trust's
income for the period in which the requirements for REMIC status are not
satisfied. The Governing Document with respect to each REMIC will include
provisions designed to maintain its status as a REMIC under the Internal Revenue
Code.
Characterization of Investments in REMIC Certificates. Unless we state
otherwise in the related prospectus supplement, the offered certificates that
are REMIC certificates will be treated as--
- "real estate assets" within the meaning of Section 856(c)(5)(B) of the
Internal Revenue Code in the hands of a real estate investment trust, and
- "loans secured by an interest in real property" or other assets described
in Section 7701(a)(19)(C) of the Internal Revenue Code in the hands of a
thrift institution,
in the same proportion that the assets of the related REMIC are so treated.
However, to the extent that the REMIC assets constitute mortgage loans on
property not used for residential or other prescribed purposes, the related
offered certificates will not be treated as assets qualifying under Section
7701(a)(19)(C). If 95% or more of the assets of the REMIC qualify for any of the
foregoing characterizations at all times during a calendar year, the related
offered certificates will qualify for the corresponding status in their entirety
for that calendar year.
In addition, offered certificates that are REMIC regular certificates will
be:
- "qualified mortgages" within the meaning of Section 860G(a)(3) of the
Internal Revenue Code in the hands of another REMIC; and
- "permitted assets" under Section 860L(c)(1)(G) for a FASIT.
Finally, interest, including original issue discount, on offered
certificates that are REMIC regular certificates, and income allocated to
offered certificates that are REMIC residual certificates, will be interest
described in Section 856(c)(3)(B) of the Internal Revenue Code if received by a
real estate investment trust, to the extent that these certificates are treated
as "real estate assets" within the meaning of Section 856(c)(5)(B) of the
Internal Revenue Code.
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The related tax administrator will determine the percentage of the REMIC's
assets that constitute assets described in the above-referenced sections of the
Internal Revenue Code with respect to each calendar quarter based on the average
adjusted basis of each category of the assets held by the REMIC during that
calendar quarter. The related tax administrator will report those determinations
to certificateholders in the manner and at the times required by applicable
Treasury regulations.
The assets of the REMIC will include, in addition to mortgage loans--
- collections on mortgage loans held pending payment on the related offered
certificates, and
- any property acquired by foreclosure held pending sale, and may include
amounts in reserve accounts.
It is unclear whether property acquired by foreclosure held pending sale,
and amounts in reserve accounts, would be considered to be part of the mortgage
loans, or whether these assets otherwise would receive the same treatment as the
mortgage loans for purposes of the above-referenced sections of the Internal
Revenue Code. In addition, in some instances, the mortgage loans may not be
treated entirely as assets described in those sections of the Internal Revenue
Code. If so, we will describe in the related prospectus supplement those
mortgage loans that are characterized differently. The Treasury regulations do
provide, however, that cash received from collections on mortgage loans held
pending payment is considered part of the mortgage loans for purposes of Section
856(c)(5)(B) of the Internal Revenue Code, relating to real estate investment
trusts.
To the extent a REMIC certificate represents ownership of an interest in a
mortgage loan that is secured in part by the related borrower's interest in a
bank account, that mortgage loan is not secured solely by real estate.
Accordingly:
- a portion of that certificate may not represent ownership of "loans
secured by an interest in real property" or other assets described in
Section 7701(a)(19)(C) of the Internal Revenue Code;
- a portion of that certificate may not represent ownership of "real estate
assets" under Section 856(c)(5)(B) of the Internal Revenue Code; and
- the interest on that certificate may not constitute "interest on
obligations secured by mortgages on real property" within the meaning of
Section 856(c)(3)(B) of the Internal Revenue Code.
Tiered REMIC Structures. For some series of REMIC certificates, the
related tax administrator may make two or more REMIC elections as to the related
trust for federal income tax purposes. As to each of these series of REMIC
certificates, our counsel will opine that each portion of the related trust as
to which a REMIC election is to be made
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will qualify as a REMIC. Each of these series will be treated as one REMIC
solely for purposes of determining:
- whether the related REMIC certificates will be "real estate assets"
within the meaning of Section 856(c)(5)(B) of the Internal Revenue Code,
- whether the related REMIC certificates will be "loans secured by an
interest in real property" under Section 7701(a)(19)(C) of the Internal
Revenue Code, and
- whether the interest/income on the related REMIC certificates is interest
described in Section 856(c)(3)(B) of the Internal Revenue Code.
Taxation of Owners of REMIC Regular Certificates.
General. Except as otherwise stated in this discussion, the Internal
Revenue Code treats REMIC regular certificates as debt instruments issued by the
REMIC and not as ownership interests in the REMIC or its assets. Holders of
REMIC regular certificates that otherwise report income under the cash method of
accounting must nevertheless report income with respect to REMIC regular
certificates under the accrual method.
Original Issue Discount. Some REMIC regular certificates may be issued
with original issue discount within the meaning of Section 1273(a) of the
Internal Revenue Code. Any holders of REMIC regular certificates issued with
original issue discount generally will have to include original issue discount
in income as it accrues, in accordance with a constant yield method, prior to
the receipt of the cash attributable to that income. The IRS has issued
regulations under Section 1271 to 1275 of the Internal Revenue Code generally
addressing the treatment of debt instruments issued with original issue
discount. Section 1272(a)(6) of the Internal Revenue Code provides special rules
applicable to the accrual of original issue discount on, among other things,
REMIC regular certificates. The Treasury Department has not issued regulations
under that section. You should be aware, however, that Section 1272(a)(6) and
the regulations under Sections 1271 to 1275 of the Internal Revenue Code do not
adequately address all issues relevant to, or are not applicable to, prepayable
securities such as the offered certificates. We recommend that you consult with
your own tax advisor concerning the tax treatment of the offered certificates.
The Internal Revenue Code requires, in computing the accrual of original
issue discount on REMIC regular certificates, that a reasonable assumption be
used concerning the rate at which borrowers will prepay the mortgage loans held
by the related REMIC. Further, adjustments must be made in the accrual of that
original issue discount to reflect differences between the prepayment rate
actually experienced and the assumed prepayment rate. The prepayment assumption
is to be determined in a manner prescribed in Treasury regulations that the
Treasury Department has not yet issued. The Committee Report indicates that the
regulations should provide that the prepayment assumption used with respect to a
REMIC regular certificate is determined once, at initial issuance, and must be
the same as that used in pricing. The prepayment assumption used in reporting
original issue discount for each series of REMIC regular certificates will be
consistent with this standard and will be disclosed in the related
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prospectus supplement. However, neither we nor any other person will make any
representation that the mortgage loans underlying any series of REMIC regular
certificates will in fact prepay at a rate conforming to the prepayment
assumption or at any other rate or that the IRS will not challenge on audit the
prepayment assumption used.
The original issue discount, if any, on a REMIC regular certificate will be
the excess of its stated redemption price at maturity over its issue price.
The issue price of a particular class of REMIC regular certificates will be
the first cash price at which a substantial amount of those certificates are
sold, excluding sales to bond houses, brokers and underwriters. If less than a
substantial amount of a particular class of REMIC regular certificates is sold
for cash on or prior to the related date of initial issuance of those
certificates, the issue price for that class will be the fair market value of
that class on the date of initial issuance.
Under the Treasury regulations, the stated redemption price of a REMIC
regular certificate is equal to the total of all payments to be made on that
certificate other than qualified stated interest. Qualified stated interest is
interest that is unconditionally payable at least annually, during the entire
term of the instrument, at:
- a single fixed rate,
- a "qualified floating rate,"
- an "objective rate,"
- a combination of a single fixed rate and one or more "qualified floating
rates,"
- a combination of a single fixed rate and one "qualified inverse floating
rate," or
- a combination of "qualified floating rates" that does not operate in a
manner that accelerates or defers interest payments on the REMIC regular
certificate.
In the case of REMIC regular certificates bearing adjustable interest
rates, the determination of the total amount of original issue discount and the
timing of the inclusion of that discount will vary according to the
characteristics of those certificates. If the original issue discount rules
apply to those certificates, we will describe in the related prospectus
supplement the manner in which those rules will be applied with respect to those
certificates in preparing information returns to the certificateholders and the
IRS.
Some classes of REMIC regular certificates may provide that the first
interest payment with respect to those certificates be made more than one month
after the date of initial issuance, a period that is longer than the subsequent
monthly intervals between interest payments. Assuming the accrual period for
original issue discount is the monthly period that ends on each payment date,
then, as a result of this long first accrual period, some or all interest
payments may be required to be included in the stated redemption price of the
REMIC regular certificate and accounted for as original issue discount. Because
interest on REMIC regular certificates must in any event be accounted for
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under an accrual method, applying this analysis would result in only a slight
difference in the timing of the inclusion in income of the yield on the REMIC
regular certificates.
In addition, if the accrued interest to be paid on the first payment date
is computed with respect to a period that begins prior to the date of initial
issuance, a portion of the purchase price paid for a REMIC regular certificate
will reflect that accrued interest. In those cases, information returns provided
to the certificateholders and the IRS will be based on the position that the
portion of the purchase price paid for the interest accrued prior to the date of
initial issuance is treated as part of the overall cost of the REMIC regular
certificate. Therefore, the portion of the interest paid on the first payment
date in excess of interest accrued from the date of initial issuance to the
first payment date is included in the stated redemption price of the REMIC
regular certificate. However, the Treasury regulations state that all or some
portion of this accrued interest may be treated as a separate asset, the cost of
which is recovered entirely out of interest paid on the first payment date. It
is unclear how an election to do so would be made under these regulations and
whether this election could be made unilaterally by a certificateholder.
Notwithstanding the general definition of original issue discount, original
issue discount on a REMIC regular certificate will be considered to be de
minimis if it is less than 0.25% of the stated redemption price of the
certificate multiplied by its weighted average maturity. For this purpose, the
weighted average maturity of a REMIC regular certificate is computed as the sum
of the amounts determined, as to each payment included in the stated redemption
price of the certificate, by multiplying:
- the number of complete years, rounding down for partial years, from the
date of initial issuance, until that payment is expected to be made,
presumably taking into account the prepayment assumption, by
- a fraction--
1. the numerator of which is the amount of the payment, and
2. the denominator of which is the stated redemption price at maturity
of the certificate.
Under the Treasury regulations, original issue discount of only a de
minimis amount, other than de minimis original issue discount attributable to a
so-called "teaser" interest rate or an initial interest holiday, will be
included in income as each payment of stated principal is made, based on the
product of:
- the total amount of the de minimis original issue discount, and
- a fraction--
1. the numerator of which is the amount of the principal payment, and
2. the denominator of which is the outstanding stated principal amount
of the subject REMIC regular certificate.
The Treasury regulations also would permit you to elect to accrue de
minimis original issue discount into income currently based on a constant yield
method. See
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"--REMICs--Taxation of Owners of REMIC Regular Certificates--Market Discount"
below for a description of that election under the applicable Treasury
regulations.
If original issue discount on a REMIC regular certificate is in excess of a
de minimis amount, the holder of the certificate must include in ordinary gross
income the sum of the daily portions of original issue discount for each day
during its taxable year on which it held the certificate, including the purchase
date but excluding the disposition date. In the case of an original holder of a
REMIC regular certificate, the daily portions of original issue discount will be
determined as described below in this "--Original Issue Discount" subsection.
As to each accrual period, the related tax administrator will calculate the
original issue discount that accrued during that accrual period. For these
purposes, an accrual period is, unless we otherwise state in the related
prospectus supplement, the period that begins on a date that corresponds to a
payment date, or in the case of the first accrual period, begins on the date of
initial issuance, and ends on the day preceding the immediately following
payment date. The portion of original issue discount that accrues in any accrual
period will equal the excess, if any, of:
- the sum of--
1. the present value, as of the end of the accrual period, of all of
the payments remaining to be made on the subject REMIC regular
certificate, if any, in future periods, presumably taking into
account the prepayment assumption, and
2. the payments made on that certificate during the accrual period of
amounts included in the stated redemption price, over
- the adjusted issue price of the subject REMIC regular certificate at the
beginning of the accrual period.
The adjusted issue price of a REMIC regular certificate is:
- the issue price of the certificate, increased by
- the total amount of original issue discount previously accrued on the
certificate, reduced by
- the amount of all prior payments of amounts included in its stated
redemption price.
The present value of the remaining payments referred to in item 1. of the second
preceding sentence will be calculated:
- assuming that payments on the REMIC regular certificate will be received
in future periods based on the related mortgage loans being prepaid at a
rate equal to the prepayment assumption;
- using a discount rate equal to the original yield to maturity of the
certificate, based on its issue price and the assumption that the related
mortgage loans will be prepaid at a rate equal to the prepayment
assumption; and
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- taking into account events, including actual prepayments, that have
occurred before the close of the accrual period.
The original issue discount accruing during any accrual period, computed as
described above, will be allocated ratably to each day during the accrual period
to determine the daily portion of original issue discount for that day.
A subsequent purchaser of a REMIC regular certificate that purchases the
certificate at a cost, excluding any portion of that cost attributable to
accrued qualified stated interest, that is less than its remaining stated
redemption price, will also be required to include in gross income the daily
portions of any original issue discount with respect to the certificate.
However, the daily portion will be reduced, if the cost is in excess of its
adjusted issue price, in proportion to the ratio that the excess bears to the
total original issue discount remaining to be accrued on the certificate. The
adjusted issue price of a REMIC regular certificate, as of any date of
determination, equals the sum of:
- the adjusted issue price or, in the case of the first accrual period, the
issue price, of the certificate at the beginning of the accrual period
which includes that date of determination, and
- the daily portions of original issue discount for all days during that
accrual period prior to that date of determination.
If the foregoing method for computing original issue discount results in a
negative amount of original issue discount as to any accrual period with respect
to a REMIC regular certificate held by you, the amount of original issue
discount accrued for that accrual period will be zero. You may not deduct the
negative amount currently. Instead, you will only be permitted to offset it
against future positive original issue discount, if any, attributable to the
certificate. Although not free from doubt, it is possible that you may be
permitted to recognize a loss to the extent your basis in the certificate
exceeds the maximum amount of payments that you could ever receive with respect
to the certificate. However, the loss may be a capital loss, which is limited in
its deductibility. The foregoing considerations are particularly relevant to
certificates that have no, or a disproportionately small, amount of principal
because they can have negative yields if the mortgage loans held by the related
REMIC prepay more quickly than anticipated. See "Risk Factors--The Investment
Performance of Your Offered Certificate Will Depend Upon Payments, Defaults and
Losses on the Underlying Mortgage Loans."
The Treasury regulations in some circumstances permit the holder of a debt
instrument to recognize original issue discount under a method that differs from
that used by the issuer. Accordingly, it is possible that you may be able to
select a method for recognizing original issue discount that differs from that
used by the trust in preparing reports to you and the IRS. Prospective
purchasers of the REMIC regular certificates should consult their tax advisors
concerning the tax treatment of these certificates in this regard.
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Market Discount. You will be considered to have purchased a REMIC regular
certificate at a market discount if--
- in the case of a certificate issued without original issue discount, you
purchased the certificate at a price less than its remaining stated
principal amount, or
- in the case of a certificate issued with original issue discount, you
purchased the certificate at a price less than its adjusted issue price.
If you purchase a REMIC regular certificate with more than a de minimis
amount of market discount, you will recognize gain upon receipt of each payment
representing stated redemption price. Under Section 1276 of the Internal Revenue
Code, you generally will be required to allocate the portion of each payment
representing some or all of the stated redemption price first to accrued market
discount not previously included in income. You must recognize ordinary income
to that extent. You may elect to include market discount in income currently as
it accrues rather than including it on a deferred basis in accordance with the
foregoing. If made, this election will apply to all market discount bonds
acquired by you on or after the first day of the first taxable year to which
this election applies.
The Treasury regulations also permit you to elect to accrue all interest
and discount, including de minimis market or original issue discount, in income
as interest, and to amortize premium, based on a constant yield method. Your
making this election with respect to a REMIC regular certificate with market
discount would be deemed to be an election to include currently market discount
in income with respect to all other debt instruments with market discount that
you acquire during the taxable year of the election or thereafter, and possibly
previously acquired instruments. Similarly, your making this election as to a
certificate acquired at a premium would be deemed to be an election to amortize
bond premium, with respect to all debt instruments having amortizable bond
premium that you own or acquire. See "--REMICs--Taxation of Owners of REMIC
Regular Certificates--Premium" below.
Each of the elections described above to accrue interest and discount, and
to amortize premium, with respect to a certificate on a constant yield method or
as interest would be irrevocable except with the approval of the IRS.
However, market discount with respect to a REMIC regular certificate will
be considered to be de minimis for purposes of Section 1276 of the Internal
Revenue Code if the market discount is less than 0.25% of the remaining stated
redemption price of the certificate multiplied by the number of complete years
to maturity remaining after the date of its purchase. In interpreting a similar
rule with respect to original issue discount on obligations payable in
installments, the Treasury regulations refer to the weighted average maturity of
obligations. It is likely that the same rule will be applied with respect to
market discount, presumably taking into account the prepayment assumption. If
market discount is treated as de minimis under this rule, it appears that the
actual discount would be treated in a manner similar to original issue discount
of a de minimis amount. See "--REMICs--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount" above. This treatment would result in
discount being included
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in income at a slower rate than discount would be required to be included in
income using the method described above.
Section 1276(b)(3) of the Internal Revenue Code specifically authorizes the
Treasury Department to issue regulations providing for the method for accruing
market discount on debt instruments, the principal of which is payable in more
than one installment. Until regulations are issued by the Treasury Department,
the relevant rules described in the Committee Report apply. The Committee Report
indicates that in each accrual period, you may accrue market discount on a REMIC
regular certificate held by you, at your option:
- on the basis of a constant yield method,
- in the case of a certificate issued without original issue discount, in
an amount that bears the same ratio to the total remaining market
discount as the stated interest paid in the accrual period bears to the
total amount of stated interest remaining to be paid on the certificate
as of the beginning of the accrual period, or
- in the case of a certificate issued with original issue discount, in an
amount that bears the same ratio to the total remaining market discount
as the original issue discount accrued in the accrual period bears to the
total amount of original issue discount remaining on the certificate at
the beginning of the accrual period.
The prepayment assumption used in calculating the accrual of original issue
discount is also used in calculating the accrual of market discount.
To the extent that REMIC regular certificates provide for monthly or other
periodic payments throughout their term, the effect of these rules may be to
require market discount to be includible in income at a rate that is not
significantly slower than the rate at which the discount would accrue if it were
original issue discount. Moreover, in any event a holder of a REMIC regular
certificate generally will be required to treat a portion of any gain on the
sale or exchange of the certificate as ordinary income to the extent of the
market discount accrued to the date of disposition under one of the foregoing
methods, less any accrued market discount previously reported as ordinary
income.
Further, Section 1277 of the Internal Revenue Code may require you to defer
a portion of your interest deductions for the taxable year attributable to any
indebtedness incurred or continued to purchase or carry a REMIC regular
certificate purchased with market discount. For these purposes, the de minimis
rule referred to above applies. Any deferred interest expense would not exceed
the market discount that accrues during the related taxable year and is, in
general, allowed as a deduction not later than the year in which the related
market discount is includible in income. If you have elected, however, to
include market discount in income currently as it accrues, the interest deferral
rule described above would not apply.
Premium. A REMIC regular certificate purchased at a cost, excluding any
portion of the cost attributable to accrued qualified stated interest, that is
greater than its
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remaining stated redemption price will be considered to be purchased at a
premium. You may elect under Section 171 of the Internal Revenue Code to
amortize the premium under the constant yield method over the life of the
certificate. If you elect to amortize bond premium, bond premium would be
amortized on a constant yield method and would be applied as an offset against
qualified stated interest. If made, this election will apply to all debt
instruments having amortizable bond premium that you own or subsequently
acquire. The IRS has issued regulations on the amortization of bond premium, but
they specifically do not apply to holders of REMIC regular certificates.
The Treasury regulations also permit you to elect to include all interest,
discount and premium in income based on a constant yield method, further
treating you as having made the election to amortize premium generally. See
"--Taxation of Owners of REMIC Regular Certificates--Market Discount" above. The
Committee Report states that the same rules that apply to accrual of market
discount and require the use of a prepayment assumption in accruing market
discount with respect to REMIC regular certificates without regard to whether
those certificates have original issue discount, will also apply in amortizing
bond premium under Section 171 of the Internal Revenue Code.
Whether you will be treated as holding a REMIC regular certificate with
amortizable bond premium will depend on--
- the purchase price paid for your offered certificate, and
- the payments remaining to be made on your offered certificate at the time
of its acquisition by you.
If you acquire an interest in any class of REMIC regular certificates
issued at a premium, you should consider consulting your own tax advisor
regarding the possibility of making an election to amortize the premium.
Realized Losses. Under Section 166 of the Internal Revenue Code, if you
are either a corporate holder of a REMIC regular certificate and or a
noncorporate holder of a REMIC regular certificate that acquires the certificate
in connection with a trade or business, you should be allowed to deduct, as
ordinary losses, any losses sustained during a taxable year in which your
offered certificate becomes wholly or partially worthless as the result of one
or more realized losses on the related mortgage loans. However, if you are a
noncorporate holder that does not acquire a REMIC regular certificate in
connection with a trade or business, it appears that--
- you will not be entitled to deduct a loss under Section 166 of the
Internal Revenue Code until your offered certificate becomes wholly
worthless, which is when its principal balance has been reduced to zero,
and
- the loss will be characterized as a short-term capital loss.
You will also have to accrue interest and original issue discount with
respect to your REMIC regular certificate, without giving effect to any
reductions in payments attributable to defaults or delinquencies on the related
mortgage loans, until it can be established that those payment reductions are
not recoverable. As a result, your taxable
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income in a period could exceed your economic income in that period. If any of
those amounts previously included in taxable income are not ultimately received
due to a loss on the related mortgage loans, you should be able to recognize a
loss or reduction in income. However, the law is unclear with respect to the
timing and character of this loss or reduction in income.
Taxation of Owners of REMIC Residual Certificates.
General. Although a REMIC is a separate entity for federal income tax
purposes, the Internal Revenue Code does not subject a REMIC to entity-level
taxation, except with regard to prohibited transactions and the other
transactions described under "--REMICs--Prohibited Transactions Tax and Other
Taxes" below. Rather, a holder of REMIC residual certificates must generally
take in income the taxable income or net loss of the related REMIC. Accordingly,
the Internal Revenue Code treats the REMIC residual certificates much
differently than it would if they were direct ownership interests in the related
mortgage loans or as debt instruments issued by the related REMIC.
Holders of REMIC residual certificates generally will be required to report
their daily portion of the taxable income or, subject to the limitations noted
in this discussion, the net loss of the related REMIC for each day during a
calendar quarter that they own those certificates. For this purpose, the taxable
income or net loss of the REMIC will be allocated to each day in the calendar
quarter ratably using a "30 days per month/ 90 days per quarter/360 days per
year" convention unless we otherwise disclose in the related prospectus
supplement. These daily amounts then will be allocated among the holders of the
REMIC residual certificates in proportion to their respective ownership
interests on that day. Any amount included in the certificateholders' gross
income or allowed as a loss to them by virtue of this paragraph will be treated
as ordinary income or loss. The taxable income of the REMIC will be determined
under the rules described below in "--REMICs--Taxation of Owners of REMIC
Residual Certificates--Taxable Income of the REMIC." Holders of REMIC residual
certificates must report the taxable income of the related REMIC without regard
to the timing or amount of cash payments by the REMIC until the REMIC's
termination. Income derived from the REMIC residual certificates will be
"portfolio income" for the purposes of the limitations under Section 469 of the
Internal Revenue Code on the deductibility of "passive losses."
A holder of a REMIC residual certificate that purchased the certificate
from a prior holder also will be required to report on its federal income tax
return amounts representing its daily share of the taxable income, or net loss,
of the related REMIC for each day that it holds the REMIC residual certificate.
These daily amounts generally will equal the amounts of taxable income or net
loss determined as described above. The Committee Report indicates that
modifications of the general rules may be made, by regulations, legislation or
otherwise to reduce, or increase, the income of a holder of a REMIC residual
certificate. These modifications would occur when a holder purchases the REMIC
residual certificate from a prior holder at a price other than the adjusted
basis that the REMIC residual certificate would have had in the hands of an
original holder of that certificate. The Treasury regulations, however, do not
provide for these modifications.
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Any payments that you receive from the seller of a REMIC residual
certificate in connection with the acquisition of that certificate will be
income to you. Although it is possible that these payments would be includible
in income immediately upon receipt, the IRS might assert that you should include
these payments in income over time according to an amortization schedule or
according to some other method. Because of the uncertainty concerning the
treatment of these payments, we recommend that you consult your tax advisor
concerning the treatment of these payments for income tax purposes.
Tax liability with respect to the amount of income that holders of REMIC
residual certificates will be required to report, will often exceed the amount
of cash payments received from the related REMIC for the corresponding period.
Consequently, you should have--
- other sources of funds sufficient to pay any federal income taxes due as
a result of your ownership of REMIC residual certificates, or
- unrelated deductions against which income may be offset.
See, however, the rules discussed below relating to:
- excess inclusions,
- residual interests without significant value, and
- noneconomic residual interests.
The fact that the tax liability associated with this income allocated to
you may exceed the cash payments received by you for the corresponding period
may significantly and adversely affect their after-tax rate of return. This
disparity between income and payments may not be offset by corresponding losses
or reductions of income attributable to your REMIC residual certificates until
subsequent tax years. Even then, the extra income may not be completely offset
due to changes in the Internal Revenue Code, tax rates or character of the
income or loss. Therefore, REMIC residual certificates will ordinarily have a
negative value at the time of issuance. See "Risk Factors--'Residual Interests'
in a 'Real Estate Mortgage Investment Conduit' Have Adverse Tax Consequences."
Taxable Income of the REMIC. The taxable income of a REMIC will equal:
- the income from the mortgage loans and other assets of the REMIC; plus
- any cancellation of indebtedness income due to the allocation of realized
losses to those REMIC certificates constituting regular interests in the
REMIC; less the following items--
1. the deductions allowed to the REMIC for interest, including original
issue discount but reduced by any premium on issuance, on any class
of REMIC certificates constituting regular interests in the REMIC,
whether offered or not,
2. amortization of any premium on the mortgage loans held by the REMIC,
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3. bad debt losses with respect to the mortgage loans held by the
REMIC, and
4. except as described below in this "--Taxable Income of the REMIC"
subsection, servicing, administrative and other expenses.
For purposes of determining its taxable income, a REMIC will have an
initial aggregate basis in its assets equal to the sum of the issue prices of
all REMIC certificates, or in the case of REMIC certificates not sold initially,
their fair market values. The aggregate basis will be allocated among the
mortgage loans and the other assets of the REMIC in proportion to their
respective fair market values. The issue price of any REMIC certificates offered
hereby will be determined in the manner described above under
"--REMICs--Taxation of Owners of REMIC Regular Certificates--Original Issue
Discount." The issue price of a REMIC certificate received in exchange for an
interest in mortgage loans or other property will equal the fair market value of
the interests in the mortgage loans or other property. Accordingly, if one or
more classes of REMIC certificates are retained initially rather than sold, the
related tax administrator may be required to estimate the fair market value of
these interests in order to determine the basis of the REMIC in the mortgage
loans and other property held by the REMIC.
Subject to possible application of the de minimis rules, the method of
accrual by a REMIC of original issue discount income and market discount income
with respect to mortgage loans that it holds will be equivalent to the method
for accruing original issue discount income for holders of REMIC regular
certificates. That method is a constant yield method taking into account the
prepayment assumption. However, a REMIC that acquires loans at a market discount
must include that market discount in income currently, as it accrues, on a
constant yield basis. See "--REMICs--Taxation of Owners of REMIC Regular
Certificates" above, which describes a method for accruing the discount income
that is analogous to that required to be used by a REMIC as to mortgage loans
with market discount that it holds.
A REMIC will acquire a mortgage loan with discount, or premium, to the
extent that the REMIC's basis, determined as described in the preceding
paragraph, is different from its stated redemption price. Discount will be
includible in the income of the REMIC as it accrues, in advance of receipt of
the cash attributable to that income, under a method similar to the method
described above for accruing original issue discount on the REMIC regular
certificates. A REMIC probably will elect under Section 171 of the Internal
Revenue Code to amortize any premium on the mortgage loans that it holds.
Premium on any mortgage loan to which this election applies may be amortized
under a constant yield method, presumably taking into account the prepayment
assumption.
A REMIC will be allowed deductions for interest, including original issue
discount, on all of the certificates that constitute regular interests in the
REMIC, whether or not offered hereby, as if those certificates were indebtedness
of the REMIC. Original issue discount will be considered to accrue for this
purpose as described above under "--REMICs--Taxation of Owners of REMIC Regular
Certificates--Original Issue
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Discount." However, the de minimis rule described in that section will not apply
in determining deductions.
If a class of REMIC regular certificates is issued at a price in excess of
the stated redemption price of that class, the net amount of interest deductions
that are allowed to the REMIC in each taxable year with respect to those
certificates will be reduced by an amount equal to the portion of that excess
that is considered to be amortized in that year. It appears that this excess
should be amortized under a constant yield method in a manner analogous to the
method of accruing original issue discount described above under
"--REMICs--Taxation of Owners of REMIC Regular Certificates--Original Issue
Discount."
As a general rule, the taxable income of a REMIC will be determined as if
the REMIC were an individual having the calendar year as its taxable year and
using the accrual method of accounting. However, no item of income, gain, loss
or deduction allocable to a prohibited transaction will be taken into account.
See "--REMICs--Prohibited Transactions Tax and Other Taxes" below. Further, the
limitation on miscellaneous itemized deductions imposed on individuals by
Section 67 of the Internal Revenue Code will not be applied at the REMIC level
so that the REMIC will be allowed full deductions for servicing, administrative
and other noninterest expenses in determining its taxable income. All those
expenses will be allocated as a separate item to the holders of the related
REMIC certificates, subject to the limitation of Section 67 of the Internal
Revenue Code. See "--REMICs--Taxation of Owners of REMIC Residual
Certificates--Possible Pass-Through of Miscellaneous Itemized Deductions" below.
If the deductions allowed to the REMIC exceed its gross income for a calendar
quarter, the excess will be the net loss for the REMIC for that calendar
quarter.
Basis Rules, Net Losses and Distributions. The adjusted basis of a REMIC
residual certificate will be equal to:
- the amount paid for that REMIC residual certificate,
- increased by, amounts included in the income of the holder of that REMIC
residual certificate, and
- decreased, but not below zero, by payments made, and by net losses
allocated, to the holder of that REMIC residual certificate.
A holder of a REMIC residual certificate is not allowed to take into
account any net loss for any calendar quarter to the extent that the net loss
exceeds the adjusted basis to that holder as of the close of that calendar
quarter, determined without regard to that net loss. Any loss that is not
currently deductible by reason of this limitation may be carried forward
indefinitely to future calendar quarters and, subject to the same limitation,
may be used only to offset income from the REMIC residual certificate.
Any distribution on a REMIC residual certificate will be treated as a
nontaxable return of capital to the extent it does not exceed the holder's
adjusted basis in the REMIC residual certificate. To the extent a payment on a
REMIC residual certificate
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exceeds the holder's adjusted basis, it will be treated as gain from the sale of
that REMIC residual certificate.
A holder's basis in a REMIC residual certificate will initially equal the
amount paid for the certificate and will be increased by that holder's allocable
share of taxable income of the related REMIC. However, these increases in basis
may not occur until the end of the calendar quarter, or perhaps the end of the
calendar year, with respect to which the related REMIC's taxable income is
allocated to that holder. To the extent the initial basis of the holder of a
REMIC residual certificate is less than the payments to that holder, and
increases in the initial basis either occur after these payments or, together
with the initial basis, are less than the amount of these payments, gain will be
recognized to that holder on these payments. This gain will be treated as gain
from the sale of its REMIC residual certificate.
The effect of these rules is that a holder of a REMIC residual certificate
may not amortize its basis in a REMIC residual certificate, but may only recover
its basis:
- through payments,
- through the deduction of any net losses of the REMIC, or
- upon the sale of its REMIC residual certificate. See "--REMICs--Sales of
REMIC Certificates" below.
For a discussion of possible modifications of these rules that may require
adjustments to income of a holder of a REMIC residual certificate other than an
original holder see "--REMICs--Taxation of Owners of REMIC Residual
Certificates--General" above. These adjustments could require a holder of a
REMIC residual certificate to account for any difference between the cost of the
certificate to the holder and the adjusted basis of the certificate would have
been in the hands of an original holder.
Excess Inclusions. Any excess inclusions with respect to a REMIC residual
certificate will be subject to federal income tax in all events. In general, the
excess inclusions with respect to a REMIC residual certificate for any calendar
quarter will be the excess, if any, of:
- the daily portions of REMIC taxable income allocable to that certificate,
over
- the sum of the daily accruals for each day during the quarter that the
certificate was held by that holder.
The daily accruals of a holder of a REMIC residual certificate will be
determined by allocating to each day during a calendar quarter its ratable
portion of a numerical calculation. That calculation is the product of the
adjusted issue price of the REMIC residual certificate at the beginning of the
calendar quarter and 120% of the long-term Federal rate in effect on the date of
initial issuance. For this purpose, the adjusted issue price of a REMIC residual
certificate as of the beginning of any calendar quarter will be equal to:
- the issue price of the certificate, increased by
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- the sum of the daily accruals for all prior quarters, and decreased, but
not below zero, by
- any payments made with respect to the certificate before the beginning of
that quarter.
The issue price of a REMIC residual certificate is the initial offering
price to the public at which a substantial amount of the REMIC residual
certificates were sold, but excluding sales to bond houses, brokers and
underwriters or, if no sales have been made, their initial value. The long-term
Federal rate is an average of current yields on Treasury securities with a
remaining term of greater than nine years, computed and published monthly by the
IRS.
Although it has not done so, the Treasury Department has authority to issue
regulations that would treat the entire amount of income accruing on a REMIC
residual certificate as excess inclusions if the REMIC residual interest
evidenced by that certificate is considered not to have significant value.
For holders of REMIC residual certificates, excess inclusions:
- will not be permitted to be offset by deductions, losses or loss
carryovers from other activities,
- will be treated as unrelated business taxable income to an otherwise
tax-exempt organization, and
- will not be eligible for any rate reduction or exemption under any
applicable tax treaty with respect to the 30% United States withholding
tax imposed on payments to holders of REMIC residual certificates that
are foreign investors. See, however, "--REMICs--Foreign Investors in
REMIC Certificates" below.
Furthermore, for purposes of the alternative minimum tax:
- excess inclusions will not be permitted to be offset by the alternative
tax net operating loss deduction, and
- alternative minimum taxable income may not be less than the taxpayer's
excess inclusions.
This last rule has the effect of preventing non-refundable tax credits from
reducing the taxpayer's income tax to an amount lower than the alternative
minimum tax on excess inclusions.
In the case of any REMIC residual certificates held by a real estate
investment trust, or REIT, the total excess inclusions with respect to these
REMIC residual certificates will be allocated among the shareholders of the REIT
in proportion to the dividends received by the shareholders from the REIT. Any
amount so allocated will be treated as an excess inclusion with respect to a
REMIC residual certificate as if held directly by the shareholder. The total
excess inclusions referred to in the previous sentence will be reduced, but not
below zero, by any REIT taxable income, within the
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meaning of Section 857(b)(2) of the Internal Revenue Code, other than any net
capital gain. Treasury regulations yet to be issued could apply a similar rule
to:
- regulated investment companies,
- common trusts, and
- some cooperatives.
The Treasury regulations, however, currently do not address this subject.
Noneconomic REMIC Residual Certificates. Under the Treasury regulations,
transfers of noneconomic REMIC residual certificates will be disregarded for all
federal income tax purposes if "a significant purpose of the transfer was to
enable the transferor to impede the assessment or collection of tax." If a
transfer is disregarded, the purported transferor will continue to remain liable
for any taxes due with respect to the income on the noneconomic REMIC residual
certificate. The Treasury regulations provide that a REMIC residual certificate
is noneconomic unless, based on the prepayment assumption and on any required or
permitted clean up calls, or required liquidation provided for in the related
Governing Document:
- the present value of the expected future payments on the REMIC residual
certificate equals at least the present value of the expected tax on the
anticipated excess inclusions, and
- the transferor reasonably expects that the transferee will receive
payments with respect to the REMIC residual certificate at or after the
time the taxes accrue on the anticipated excess inclusions in an amount
sufficient to satisfy the accrued taxes.
The present value calculation referred to above is calculated using the
applicable Federal rate for obligations whose term ends on the close of the last
quarter in which excess inclusions are expected to accrue with respect to the
REMIC residual certificate. This rate is computed and published monthly by the
IRS.
Accordingly, all transfers of REMIC residual certificates that may
constitute noneconomic residual interests will be subject to restrictions under
the terms of the related Governing Document that are intended to reduce the
possibility of any transfer being disregarded. These restrictions will require
an affidavit:
- from each party to the transfer, stating that no purpose of the transfer
is to impede the assessment or collection of tax,
- from the prospective transferee, providing representations as to its
financial condition, and
- from the prospective transferor, stating that it has made a reasonable
investigation to determine the transferee's historic payment of its debts
and ability to continue to pay its debts as they come due in the future.
The Treasury recently issued proposed regulations that would revise this
safe harbor. The proposed regulations would make the safe harbor unavailable
unless the present
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value of the anticipated tax liabilities associated with holding the residual
interest did not exceed the sum of:
- the present value of any consideration given to the transferee to acquire
the interest,
- the present value of the expected future distributions on the interest,
and
- the present value of the anticipated tax savings associated with the
holding of the interest as the REMIC generates losses.
Present values would be computed using a discount rate equal to an
applicable Federal rate, except that if a transferee could demonstrate that it
borrowed regularly in the course of its trade or business substantial funds at a
lower rate from unrelated third parties, that lower rate could be used as the
discount rate.
If adopted, the proposed regulations may apply to the transfer of a
noneconomic residual certificate as early as February 4, 2000. Prospective
investors should consult their own tax advisors as to the applicability and
effect of those regulations.
Prior to purchasing a REMIC residual certificate, prospective purchasers
should consider the possibility that a purported transfer of a REMIC residual
certificate to another party at some future date may be disregarded in
accordance with the above-described rules. This would result in the retention of
tax liability by the transferor with respect to that purported transfer.
We will disclose in the related prospectus supplement whether the offered
REMIC residual certificates may be considered noneconomic residual interests
under the Treasury regulations. However, we will base any disclosure that a
REMIC residual certificate will not be considered noneconomic upon various
assumptions. Further, we will make no representation that a REMIC residual
certificate will not be considered noneconomic for purposes of the
above-described rules.
See "--REMICs--Foreign Investors in REMIC Certificates" below for
additional restrictions applicable to transfers of REMIC residual certificates
to foreign persons.
Mark-to-Market Rules. Regulations under Section 475 of the Internal
Revenue Code require that a securities dealer mark to market securities held for
sale to customers. This mark-to-market requirement applies to all securities
owned by a dealer, except to the extent that the dealer has specifically
identified a security as held for investment. These regulations provide that for
purposes of this mark-to-market requirement, a REMIC residual certificate is not
treated as a security for purposes of Section 475 of the Internal Revenue Code.
Thus, a REMIC residual certificate is not subject to the mark-to-market rules.
We recommend that prospective purchasers of a REMIC residual certificate consult
their tax advisors regarding these regulations.
Transfers of REMIC Residual Certificates to Investors That are Foreign
Persons. Unless we otherwise state in the related prospectus supplement,
transfers of REMIC residual certificates to investors that are foreign persons
under the Internal Revenue Code will be prohibited under the related Governing
Documents.
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If transfers of REMIC residual certificates to investors that are foreign
persons are permitted under the related Governing Documents, and such a transfer
takes place, then it is possible that the transfer will be disregarded for all
federal tax purposes. The applicable Treasury regulations provide that a
transfer of a REMIC residual certificate that has "tax avoidance potential" to a
non-U.S. Person will be disregarded for all federal tax purposes, unless the
transferee's income is effectively connected with the conduct of a trade or
business within the United States. A REMIC residual certificate is deemed to
have tax avoidance potential unless, at the time of the transfer--
- the future value of expected distributions equals at least 30% of the
anticipated excess inclusions after the transfer, and
- the transferor reasonably expects that the transferee will receive
sufficient distributions from the REMIC at or after the time at which the
excess inclusions accrue and prior to the end of the next succeeding
taxable year for the accumulated withholding tax liability to be paid.
- If the non-U.S. Person transfers the REMIC residual certificate back to a
U.S. Person, the transfer will be disregarded and the foreign transferor
will continue to be treated as the owner unless arrangements are made so
that the transfer does not have the effect of allowing the transferor to
avoid tax on accrued excess inclusions.
Pass-Through of Miscellaneous Itemized Deductions. Fees and expenses of a
REMIC generally will be allocated to the holders of the related REMIC residual
certificates. The applicable Treasury regulations indicate, however, that in the
case of a REMIC that is similar to a single class grantor trust, all or a
portion of these fees and expenses should be allocated to the holders of the
related REMIC regular certificates. Unless we state otherwise in the related
prospectus supplement, however, these fees and expenses will be allocated to
holders of the related REMIC residual certificates in their entirety and not to
the holders of the related REMIC regular certificates.
If the holder of a REMIC certificate receives an allocation of fees and
expenses in accordance with the preceding discussion, and if that holder is:
- an individual,
- an estate or trust, or
- a Pass-Through Entity beneficially owned by one or more individuals,
estates or trusts,
then--
- an amount equal to this individual's, estate's or trust's share of these
fees and expenses will be added to the gross income of this holder, and
- the individual's, estate's or trust's share of these fees and expenses
will be treated as a miscellaneous itemized deduction allowable subject
to the limitation of Section 67 of the Internal Revenue Code, which
permits the deduction of these
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fees and expenses only to the extent they exceed, in total, 2% of a
taxpayer's adjusted gross income.
In addition, Section 68 of the Internal Revenue Code provides that the
amount of itemized deductions otherwise allowable for an individual whose
adjusted gross income exceeds a specified amount will be reduced by the lesser
of:
- 3% of the excess of the individual's adjusted gross income over the
specified amount, or
- 80% of the amount of itemized deductions otherwise allowable for the
taxable year.
Furthermore, in determining the alternative minimum taxable income of a
holder of a REMIC certificate that is--
- an individual,
- an estate or trust, or
- a Pass-Through Entity beneficially owned by one or more individuals,
estates or trusts,
no deduction will be allowed for the holder's allocable portion of servicing
fees and other miscellaneous itemized deductions of the REMIC, even though an
amount equal to the amount of these fees and other deductions will be included
in the holder's gross income.
The amount of additional taxable income reportable by holders of REMIC
certificates that are subject to the limitations of either Section 67 or Section
68 of the Internal Revenue Code, or the complete disallowance of the related
expenses for alternative minimum tax purposes, may be substantial.
Accordingly, REMIC certificates to which these expenses are allocated will
generally not be appropriate investments for:
- an individual,
- an estate or trust, or
- a Pass-Through Entity beneficially owned by one or more individuals,
estates or trusts.
We recommend that those prospective investors consult with their tax
advisors prior to making an investment in a REMIC certificate to which these
expenses are allocated.
Sales of REMIC Certificates. If a REMIC certificate is sold, the selling
certificateholder will recognize gain or loss equal to the difference between
the amount realized on the sale and its adjusted basis in the REMIC certificate.
The adjusted basis of a REMIC regular certificate generally will equal:
- the cost of the certificate to that certificateholder, increased by
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- income reported by that certificateholder with respect to the
certificate, including original issue discount and market discount
income, and reduced, but not below zero, by
- payments on the certificate received by that certificateholder, amortized
premium and realized losses allocated to the certificates and previously
deducted by the certificateholder.
The adjusted basis of a REMIC residual certificate will be determined as
described above under "--REMICs--Taxation of Owners of REMIC Residual
Certificates--Basis Rules, Net Losses and Distributions." Except as described
below in this "--Sales of REMIC Certificates" subsection, any gain or loss from
your sale of a REMIC certificate will be capital gain or loss, provided that you
hold the certificate as a capital asset within the meaning of Section 1221 of
the Internal Revenue Code, which is generally property held for investment.
In addition to the recognition of gain or loss on actual sales, the
Internal Revenue Code requires the recognition of gain, but not loss, upon the
constructive sale of an appreciated financial position. A constructive sale of
an appreciated financial position occurs if a taxpayer enters into a transaction
or series of transactions that have the effect of substantially eliminating the
taxpayer's risk of loss and opportunity for gain with respect to the financial
instrument. Debt instruments that--
- entitle the holder to a specified principal amount,
- pay interest at a fixed or variable rate, and
- are not convertible into the stock of the issuer or a related party,
cannot be the subject of a constructive sale for this purpose. Because most
REMIC regular certificates meet this exception, Section 1259 will not apply to
most REMIC regular certificates. However, REMIC regular certificates that have
no, or a disproportionately small, amount of principal, can be the subject of a
constructive sale.
Finally, a taxpayer may elect to have net capital gain taxed at ordinary
income rates rather than capital gains rates in order to include the net capital
gain in total net investment income for the taxable year. A taxpayer would do so
because of the rule that limits the deduction of interest on indebtedness
incurred to purchase or carry property held for investment to a taxpayer's net
investment income.
As of the date of this prospectus, the Internal Revenue Code provides for
lower rates as to long-term capital gains than those applicable to the
short-term capital gains and ordinary income recognized or received by
individuals. No similar rate differential exists for corporations. In addition,
the distinction between a capital gain or loss and ordinary income or loss is
relevant for other purposes to both individuals and corporations.
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Gain from the sale of a REMIC regular certificate that might otherwise be a
capital gain will be treated as ordinary income to the extent that the gain does
not exceed the excess, if any, of:
- the amount that would have been includible in the seller's income with
respect to that REMIC regular certificate assuming that income had
accrued on the certificate at a rate equal to 110% of the applicable
Federal rate determined as of the date of purchase of the certificate,
which is a rate based on an average of current yields on Treasury
securities having a maturity comparable to that of the certificate based
on the application of the prepayment assumption to the certificate, over
- the amount of ordinary income actually includible in the seller's income
prior to that sale.
In addition, gain recognized on the sale of a REMIC regular certificate by
a seller who purchased the certificate at a market discount will be taxable as
ordinary income in an amount not exceeding the portion of that discount that
accrued during the period the certificate was held by the seller, reduced by any
market discount included in income under the rules described above under
"--REMICs--Taxation of Owners of REMIC Regular Certificates--Market Discount"
and "--Premium."
REMIC certificates will be "evidences of indebtedness" within the meaning
of Section 582(c)(1) of the Internal Revenue Code, so that gain or loss
recognized from the sale of a REMIC certificate by a bank or thrift institution
to which that section of the Internal Revenue Code applies will be ordinary
income or loss.
A portion of any gain from the sale of a REMIC regular certificate that
might otherwise be capital gain may be treated as ordinary income to the extent
that a holder holds the certificate as part of a "conversion transaction" within
the meaning of Section 1258 of the Internal Revenue Code. A conversion
transaction generally is one in which the taxpayer has taken two or more
positions in the same or similar property that reduce or eliminate market risk,
if substantially all of the taxpayer's return is attributable to the time value
of the taxpayer's net investment in that transaction. The amount of gain so
realized in a conversion transaction that is recharacterized as ordinary income
generally will not exceed the amount of interest that would have accrued on the
taxpayer's net investment at 120% of the appropriate applicable Federal rate at
the time the taxpayer enters into the conversion transaction, subject to
appropriate reduction for prior inclusion of interest and other ordinary income
items from the transaction.
Except as may be provided in Treasury regulations yet to be issued, a loss
realized on the sale of a REMIC residual certificate will be subject to the
"wash sale" rules of Section 1091 of the Internal Revenue Code, if during the
period beginning six months before, and ending six months after, the date of
that sale the seller of that certificate:
- reacquires that same REMIC residual certificate,
- acquires any other residual interest in a REMIC, or
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- acquires any similar interest in a taxable mortgage pool, as defined in
Section 7701(i) of the Internal Revenue Code.
In that event, any loss realized by the holder of a REMIC residual certificate
on the sale will not be recognized or deductible currently, but instead will be
added to that holder's adjusted basis in the newly-acquired asset.
Prohibited Transactions Tax and Other Taxes. The Internal Revenue Code
imposes a tax on REMICs equal to 100% of the net income derived from prohibited
transactions. In general, subject to specified exceptions, a prohibited
transaction includes:
- the disposition of a non-defaulted mortgage loan,
- the receipt of income from a source other than a mortgage loan or other
permitted investments,
- the receipt of compensation for services, or
- the gain from the disposition of an asset purchased with collections on
the mortgage loans for temporary investment pending payment on the REMIC
certificates.
It is not anticipated that any REMIC will engage in any prohibited
transactions as to which it would be subject to this tax.
In addition, some contributions to a REMIC made after the day on which the
REMIC issues all of its interests could result in the imposition of a tax on the
REMIC equal to 100% of the value of the contributed property. The related
Governing Document will include provisions designed to prevent the acceptance of
any contributions that would be subject to this tax.
REMICs also are subject to federal income tax at the highest corporate rate
on Net Income From Foreclosure Property, determined by reference to the rules
applicable to REITs. The related Governing Documents may permit the special
servicer to conduct activities with respect to a mortgaged property acquired by
one of our trusts in a manner that causes the trust to incur this tax, if doing
so would, in the reasonable discretion of the special servicer, maximize the net
after-tax proceeds to certificateholders. However, under no circumstance may the
special servicer allow the acquired mortgaged property to cease to be a
"permitted investment" under Section 860G(a)(5) of the Internal Revenue Code.
Unless we otherwise disclose in the related prospectus supplement, it is
not anticipated that any material state or local income or franchise tax will be
imposed on any REMIC.
Unless we state otherwise in the related prospectus supplement, and to the
extent permitted by then applicable laws, any tax on prohibited transactions,
particular contributions or Net Income From Foreclosure Property, and any state
or local income or franchise tax, that may be imposed on the REMIC will be borne
by the related
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trustee, tax administrator, master servicer, special servicer or manager, in any
case out of its own funds, provided that--
- the person has sufficient assets to do so, and
- the tax arises out of bad faith, willful misfeasance or gross negligence
on the part of that person in performing its obligations under the
related Governing Document.
Any tax not borne by one of these persons would be charged against the
related trust resulting in a reduction in amounts payable to holders of the
related REMIC certificates.
Tax and Restrictions on Transfers of REMIC Residual Certificates to
Particular Organizations. If a REMIC residual certificate is transferred to a
Disqualified Organization, a tax will be imposed in an amount equal to the
product of:
- the present value of the total anticipated excess inclusions with respect
to the REMIC residual certificate for periods after the transfer, and
- the highest marginal federal income tax rate applicable to corporations.
The value of the anticipated excess inclusions is discounted using the
applicable Federal rate for obligations whose term ends on the close of the last
quarter in which excess inclusions are expected to accrue with respect to the
REMIC residual certificate.
The anticipated excess inclusions must be determined as of the date that
the REMIC residual certificate is transferred and must be based on:
- events that have occurred up to the time of the transfer,
- the prepayment assumption, and
- any required or permitted clean up calls or required liquidation provided
for in the related Governing Document.
The tax on transfers to Disqualified Organizations generally would be
imposed on the transferor of the REMIC residual certificate, except when the
transfer is through an agent for a Disqualified Organization. In that case, the
tax would instead be imposed on the agent. However, a transferor of a REMIC
residual certificate would in no event be liable for the tax with respect to a
transfer if:
- the transferee furnishes to the transferor an affidavit that the
transferee is not a Disqualified Organization, and
- as of the time of the transfer, the transferor does not have actual
knowledge that the affidavit is false.
In addition, if a Pass-Through Entity includes in income excess inclusions
with respect to a REMIC residual certificate, and a Disqualified Organization is
the record
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holder of an interest in that entity, then a tax will be imposed on that entity
equal to the product of:
- the amount of excess inclusions on the certificate that are allocable to
the interest in the Pass-Through Entity held by the Disqualified
Organization, and
- the highest marginal federal income tax rate imposed on corporations.
A Pass-Through Entity will not be subject to this tax for any period,
however, if each record holder of an interest in that Pass-Through Entity
furnishes to that Pass-Through Entity:
- the holder's social security number and a statement under penalties of
perjury that the social security number is that of the record holder, or
- a statement under penalties of perjury that the record holder is not a
Disqualified Organization.
For taxable years beginning on or after January 1, 1998, if an Electing
Large Partnership holds a REMIC residual certificate, all interests in the
Electing Large Partnership are treated as held by Disqualified Organizations for
purposes of the tax imposed on pass-through entities described in the second
preceding paragraph. This tax on Electing Large Partnerships must be paid even
if each record holder of an interest in that partnership provides a statement
mentioned in the prior paragraph.
In addition, a person holding an interest in a Pass-Through Entity as a
nominee for another person will, with respect to that interest, be treated as a
Pass-Through Entity.
Moreover, an entity will not qualify as a REMIC unless there are reasonable
arrangements designed to ensure that:
- the residual interests in the entity are not held by Disqualified
Organizations, and
- the information necessary for the application of the tax described in
this prospectus will be made available.
We will include in the related Governing Document restrictions on the
transfer of REMIC residual certificates and other provisions that are intended
to meet this requirement, and we will discuss those restrictions and provisions
in any prospectus supplement relating to the offering of any REMIC residual
certificate.
Termination. A REMIC will terminate immediately after the payment date
following receipt by the REMIC of the final payment with respect to the related
mortgage loans or upon a sale of the REMIC's assets following the adoption by
the REMIC of a plan of complete liquidation. The last payment on a REMIC regular
certificate will be treated as a payment in retirement of a debt instrument. In
the case of a REMIC residual certificate, if the last payment on that
certificate is less than the REMIC residual certificateholder's adjusted basis
in the certificate, that holder should, but may not, be treated as realizing a
capital loss equal to the amount of that difference.
Reporting and Other Administrative Matters. Solely for purposes of the
administrative provisions of the Internal Revenue Code, a REMIC will be treated
as a partnership
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and holders of the related REMIC residual certificates will be treated as
partners. Unless we otherwise state in the related prospectus supplement, the
related tax administrator will file REMIC federal income tax returns on behalf
of the REMIC, and will be designated as and will act as or on behalf of the tax
matters person with respect to the REMIC in all respects.
As, or as agent for, the tax matters person, the related tax administrator,
subject to applicable notice requirements and various restrictions and
limitations, generally will have the authority to act on behalf of the REMIC and
the holders of the REMIC residual certificates in connection with the
administrative and judicial review of the REMIC's--
- income,
- deductions
- gains,
- losses, and
- classification as a REMIC.
Holders of REMIC residual certificates generally will be required to report
these REMIC items consistently with their treatment on the related REMIC's tax
return. In addition, these holders may in some circumstances be bound by a
settlement agreement between the related tax administrator, as, or as agent for,
the tax matters person, and the IRS concerning any REMIC item. Adjustments made
to the REMIC's tax return may require these holders to make corresponding
adjustments on their returns. An audit of the REMIC's tax return, or the
adjustments resulting from that audit, could result in an audit of a holder's
return.
No REMIC will be registered as a tax shelter under Section 6111 of the
Internal Revenue Code. Any person that holds a REMIC residual certificate as a
nominee for another person may be required to furnish to the related REMIC, in a
manner to be provided in Treasury regulations, the name and address of that
other person, as well as other information.
Reporting of interest income, including any original issue discount, with
respect to REMIC regular certificates is required annually, and may be required
more frequently under Treasury regulations. These information reports generally
are required to be sent or made readily available through electronic means to
individual holders of REMIC regular certificates and the IRS. Holders of REMIC
regular certificates that are--
- corporations,
- trusts,
- securities dealers, and
- various other non-individuals,
will be provided interest and original issue discount income information and the
information set forth in the following paragraphs. This information will be
provided upon
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request in accordance with the requirements of the applicable regulations. The
information must be provided by the later of:
- 30 days after the end of the quarter for which the information was
requested, or
- two weeks after the receipt of the request.
Reporting with respect to REMIC residual certificates, including--
- income,
- excess inclusions,
- investment expenses, and
- relevant information regarding qualification of the REMIC's assets,
will be made as required under the Treasury regulations, generally on a
quarterly basis.
As applicable, the REMIC regular certificate information reports will
include a statement of the adjusted issue price of the REMIC regular certificate
at the beginning of each accrual period. In addition, the reports will include
information required by regulations with respect to computing the accrual of any
market discount. Because exact computation of the accrual of market discount on
a constant yield method would require information relating to the holder's
purchase price that the REMIC may not have, the regulations only require that
information pertaining to the appropriate proportionate method of accruing
market discount be provided. See "--REMICs--Taxation of Owners of REMIC Regular
Certificates--Market Discount."
Unless we otherwise specify in the related prospectus supplement, the
responsibility for complying with the foregoing reporting rules will be borne by
the related tax administrator for the subject REMIC.
Backup Withholding with Respect to REMIC Certificates. Payments of
interest and principal, as well as payments of proceeds from the sale of REMIC
certificates, may be subject to the backup withholding tax under Section 3406 of
the Internal Revenue Code at a rate of 31% if recipients of these payments:
- fail to furnish to the payor information regarding, among other things,
their taxpayer identification numbers, or
- otherwise fail to establish an exemption from this tax.
Any amounts deducted and withheld from a payment to a recipient would be
allowed as a credit against the recipient's federal income tax. Furthermore,
penalties may be imposed by the IRS on a recipient of payments that is required
to supply information but that does not do so in the proper manner.
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Foreign Investors in REMIC Certificates. Unless we otherwise disclose in
the related prospectus supplement, a holder of a REMIC regular certificate that
is--
- a foreign person, and
- not subject to federal income tax as a result of any direct or indirect
connection to the United States in addition to its ownership of that
certificate,
will normally not be subject to United States federal income or withholding tax
with respect to a payment on a REMIC regular certificate. To avoid withholding
or tax, that holder must comply with applicable identification requirements.
These requirements include delivery of a statement, signed by the
certificateholder under penalties of perjury, certifying that the
certificateholder is a foreign person and providing the name and address of the
certificateholder.
On October 6, 1997, the Treasury Department issued new regulations that
modify the withholding, backup withholding and information reporting rules
described above. These regulations will generally be effective for investments
made after December 31, 2000, subject to applicable transition rules.
Prospective investors are urged to consult their own tax advisors regarding
these regulations.
For these purposes, a foreign person is anyone other than a U.S. Person.
It is possible that the IRS may assert that the foregoing tax exemption
should not apply with respect to a REMIC regular certificate held by a person or
entity that owns directly or indirectly a 10% or greater interest in the related
REMIC residual certificates. If the holder does not qualify for exemption,
payments of interest, including payments in respect of accrued original issue
discount, to that holder may be subject to a tax rate of 30%, subject to
reduction under any applicable tax treaty.
It is possible, under regulations promulgated under Section 881 of the
Internal Revenue Code concerning conduit financing transactions, that the
exemption from withholding taxes described above may also not be available to a
holder who is a foreign person and either--
- owns 10% or more of one or more underlying mortgagors, or
- if the holder is a controlled foreign corporation, is related to one or
more mortgagors in the applicable trust.
Further, it appears that a REMIC regular certificate would not be included
in the estate of a nonresident alien individual and would not be subject to
United States estate taxes. However, it is recommended that certificateholders
who are nonresident alien individuals consult their tax advisors concerning this
question.
Unless we otherwise state in the related prospectus supplement, the related
Governing Document will prohibit transfers of REMIC residual certificates to
investors that are:
- foreign persons, or
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- United States persons, if classified as a partnership under the Internal
Revenue Code, unless all of their beneficial owners are United States
persons.
FASITs
General. An election may be made to treat the trust for a series of
offered certificates or specified assets of that trust, as a financial asset
securitization investment trust, or FASIT, within the meaning of Section 860L(a)
of the Internal Revenue Code. The election would be noted in the applicable
prospectus supplement. If a FASIT election is made, the offered certificates
will be designated as classes of regular interests in that FASIT, and there will
be one class of ownership interest in the FASIT. With respect to each series of
offered certificates as to which the related tax administrator makes a FASIT
election, and assuming, among other things--
- the making of an appropriate election, and
- compliance with the related Governing Document,
our counsel will deliver its opinion generally to the effect that:
- the relevant assets will qualify as a FASIT,
- those offered certificates will be FASIT regular certificates,
representing FASIT regular interests in the FASIT, and
- one class of certificates of the same series will be the FASIT ownership
certificates, representing the sole class of ownership interest in the
FASIT.
Only FASIT regular certificates are offered by this prospectus. If so
specified in the applicable prospectus supplement, a portion of the trust for a
series of certificates as to no FASIT election is made may be treated as a
grantor trust for federal income tax purposes. See "--Grantor Trusts."
On February 4, 2000, the Treasury Department issued proposed regulations
relating to FASITs. References to the "FASIT proposed regulations" in this
discussion refer to those proposed regulations. The proposed regulations have
not been adopted as final and, in general, are not proposed to be effective as
of the date of this prospectus. They nevertheless are indicative of the rules
the Treasury Department currently views as appropriate with regard to the FASIT
provisions.
Characterization of Investments in FASIT Regular Certificates. FASIT
regular certificates held by a real estate investment trust will constitute
"real estate assets" within the meaning of Section 856(c)(4)(A) of the Internal
Revenue Code and interest on the FASIT regular certificates will be considered
"interest on obligations secured by mortgages on real property or on interests
in real property" within the meaning of Section 856(c)(3)(B) of the Internal
Revenue Code in the same proportion, for both purposes, that the assets and
income of the FASIT would be so treated. FASIT regular certificates held by a
domestic building and loan association will be treated as "regular interest[s]
in a FASIT" under Section 7701(a)(19)(C)(xi) of the Internal Revenue Code, but
only in the proportion that the FASIT holds "loans secured by an interest in
real property which is . . . residential real property" within the meaning of
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Section 7701(a)(19)(C)(v) of the Internal Revenue Code. For this purpose,
mortgage loans secured by multifamily residential housing should qualify. It is
also likely that mortgage loans secured by health care related facilities would
qualify as "loans secured by an interest in . . . health institutions or
facilities, including structures designed or used primarily for residential
purposes for . . . persons under care" within the meaning of Section
7701(a)(19)(C)(vii) of the Internal Revenue Code. If at all times 95% or more of
the assets of the FASIT or the income on those assets qualify for the foregoing
treatments, the FASIT regular certificates will qualify for the corresponding
status in their entirety. Mortgage loans which have been defeased with Treasury
obligations and the income from those loans will not qualify for the foregoing
treatments. Accordingly, the FASIT regular certificates may not be a suitable
investment for you if you require a specific amount or percentage of assets or
income meeting the foregoing treatments. For purposes of Section 856(c)(4)(A) of
the Internal Revenue Code, payments of principal and interest on a mortgage loan
that are reinvested pending distribution to holders of FASIT regular
certificates should qualify for that treatment. FASIT regular certificates held
by a regulated investment company will not constitute "government securities"
within the meaning of Section 851(b)(4)(A)(i) of the Internal Revenue Code.
FASIT regular certificates held by various financial institutions will
constitute an "evidence of indebtedness" within the meaning of Section 582(c)(1)
of the Internal Revenue Code.
Qualification as a FASIT.
General. In order to qualify as a FASIT, the trust for a series of
offered certificates or specified assets of that trust must comply with the
requirements set forth in the Internal Revenue Code on an ongoing basis. The
FASIT must fulfill an asset test, which requires that substantially all of the
assets of the FASIT, as of, and at all times following, the close of the third
calendar month beginning after the FASIT's startup day, which for purposes of
this discussion is the date of the initial issuance of the FASIT regular
certificates, be permitted assets for a FASIT.
Permitted assets for a FASIT include--
- cash or cash equivalents,
- specified types of debt instruments, other than debt instruments issued
by the owner of the FASIT or a related party, and contracts to acquire
those debt instruments,
- hedges and contracts to acquire hedges,
- foreclosure property, and
- regular interests in another FASIT or in a REMIC.
As discussed below in this "--Qualification as a FASIT" subsection, specified
restrictions apply to each type of permitted asset.
Under the FASIT proposed regulations, the "substantially all" requirement
would be met if at all times the aggregate adjusted basis of the permitted
assets is more than 99 percent of the aggregate adjusted basis of all the assets
held by the FASIT, including
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assets deemed to be held by the FASIT under Section 860I(b)(2) of the Internal
Revenue Code because they support a regular interest in the FASIT.
The FASIT provisions also require the FASIT ownership interest to be held
only by some fully taxable domestic corporations and do not recognize transfers
of "high-yield regular interests", as described in "Permitted Interests" below,
to taxpayers other than fully taxable domestic corporations or other FASITs. The
related Governing Document will provide that no legal or beneficial interest in
the ownership interest or in any class or classes of certificates that we
determine to be high-yield regular interests may be transferred or registered
unless all applicable conditions designed to prevent violation of this
requirement, are met.
Permitted Assets. The proposed regulations enumerate the types of debt
that qualify as permitted assets for a FASIT. The FASIT provisions provide that
permitted debt instruments must bear interest, if any, at a fixed or qualified
variable rate. Under the FASIT proposed regulations, the definition of debt
permitted to be held by a FASIT, would include--
- REMIC regular interests,
- regular interests of other FASITs,
- inflation indexed debt instruments,
- credit card receivables, and
- some stripped bonds and coupons.
However, under the FASIT proposed regulations, equity linked debt instruments
and defaulted debt instruments would not be permitted assets for a FASIT. In
addition, a FASIT may not hold--
- debt of the owner of the FASIT ownership interest,
- debt guaranteed by the owner of the FASIT ownership interest in
circumstances such that the owner is in substance the primary obligor on
the debt instrument, or
- debt issued by third parties that is linked to the performance or
payments of debt instruments issued by the owner or a related person, are
not permitted assets.
Finally, debt that is traded on an established securities market and subject to
a foreign withholding tax is not a permitted asset for a FASIT.
Permitted hedges include interest rate or foreign currency notional
principal contracts, letters of credit, insurance, guarantees of payment default
and similar instruments. These hedges must be reasonably required to guarantee
or hedge against the FASIT's risks associated with being the obligor on
interests issued by the FASIT. The FASIT proposed regulations do not include a
list of specified permitted hedges or guarantees, but rather focus on the
intended function of a hedge and permit the contract to offset the following
risk factors:
- fluctuations in market interest rates;
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- fluctuations in currency exchange rates;
- the credit quality of, or default on, the FASIT's assets or debt
instruments underlying the FASIT's assets; and
- the receipt of payments on the FASIT's assets earlier or later than
originally anticipated.
The FASIT proposed regulations prohibit a hedge or guarantee from
referencing assets other than permitted assets, indices, economic indicators or
financial averages that are not both widely disseminated and designed to
correlate closely with the changes in one or more of the risk factors described
above. However, under the FASIT proposed regulations, FASIT owners will be able
to hold hedges or guarantees inside a FASIT that do not relate to the already
issued regular interests, or to assets the FASIT already holds, if the FASIT
expects to issue regular interests, or expects to hold assets, that are related
to the hedge or guarantee in question. The proposed regulations also place
restrictions on hedges and guarantees entered into with the holder of the FASIT
ownership interest or a related party.
Property acquired in connection with the default or imminent default of a
debt instrument held by a FASIT may qualify both as foreclosure property and as
a type of permitted asset under the FASIT provisions. It will in general
continue to qualify as foreclosure property during a grace period that runs
until the end of the third taxable year beginning after the taxable year in
which the FASIT acquires the foreclosure property. Under the FASIT proposed
regulations, if the foreclosure property also would qualify as another type of
permitted asset, it may be held beyond the close of that grace period. However,
at the close of the grace period, gain, if any, on the property must be
recognized as if the property had been contributed by the owner of the FASIT on
that date. In addition, the FASIT proposed regulations provide that, after the
close of the grace period, disposition of the foreclosure property is
potentially subject to a 100% prohibited transactions tax, without the benefit
of an exception to this tax applicable to sales of foreclosure property.
Permitted Interests. In addition to the foregoing, interests in a FASIT
also must meet specified requirements. All of the interests in a FASIT must be
either of the following:
- a single class of ownership interest, or
- one or more classes of regular interests.
An ownership interest is an interest in a FASIT other than a regular
interest that is issued on the startup day, is designated an ownership interest
and is held by a single, fully-taxable, domestic corporation. A regular interest
is an interest in a FASIT that is issued on or after the startup day with fixed
terms, is designated as a regular interest, and--
1. unconditionally entitles the holder to receive a specified principal
amount or other similar amount,
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2. provides that interest payments or other similar amounts, if any, at or
before maturity either are payable based on a fixed rate or a qualified
variable rate,
3. has a stated maturity of not longer than 30 years,
4. has an issue price not greater than 125% of its stated principal amount,
and
5. has a yield to maturity not greater than 5 percentage points higher than
the applicable Federal rate, as defined in Section 1274(d) of the
Internal Revenue Code, for Treasury obligations of a similar maturity.
A regular interest that is described in the preceding sentence except that
it fails to meet one or more of requirements 1, 4 or 5, is a "high-yield regular
interest". Further, to be a high-yield regular interest, an interest that fails
requirement 2 must consist of a specified portion of the interest payments on
the permitted assets, determined by reference to the rules related to permitted
rates for REMIC regular interests that have no, or a disproportionately small,
amount of principal. An interest in a FASIT may be treated as a regular interest
even if payments of principal with respect to that interest are subordinated to
payments on other regular interests or the ownership interest in the FASIT, and
are contingent on--
- the absence of defaults or delinquencies on permitted assets,
- lower than reasonably expected returns on permitted assets,
- unanticipated expenses incurred by the FASIT, or
- prepayment interest shortfalls.
Cessation of FASIT. If an entity fails to comply with one or more of the
ongoing requirements of the Internal Revenue Code for status as a FASIT during
any taxable year, the Internal Revenue Code provides that the entity or
applicable portion of that entity, will not be treated as a FASIT thereafter. In
this event, any entity that holds mortgage loans and is the obligor with respect
to debt obligations with two or more maturities will be classified, presumably,
as a taxable mortgage pool under general federal income tax principles, and the
FASIT regular certificates may be treated as equity interests in the entity.
Under the FASIT proposed regulations, the underlying arrangement generally
cannot reelect FASIT status and any election a FASIT owner made, other than the
FASIT election, and any method of accounting adopted with respect to the FASIT
assets, binds the underlying arrangement as if the underlying arrangement itself
had made those elections or adopted that method. In the case of an inadvertent
cessation of a FASIT, under the FASIT proposed regulations, the Commissioner of
the IRS may grant relief from the adverse consequences of that cessation,
subject to those adjustments as the Commissioner may require the FASIT and all
holders of interests in the FASIT to accept with respect to the period in which
the FASIT failed to qualify as such.
Under the proposed FASIT regulation, apart from failure to qualify as a
FASIT, a FASIT may not revoke its election or cease to be a FASIT without the
consent of the Commissioner of the IRS.
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Regular interest holders, in the case of cessation of a FASIT, are treated
as exchanging their FASIT regular interests for new interests in the underlying
arrangement. The FASIT proposed regulations would classify the new interests
under general principles of Federal income tax law, for example, as interests in
debt instruments, as interest in a partnership or interests in an entity subject
to corporate taxation, depending on what the classification of those interests
would have been in the absence of a FASIT election. On the deemed receipt of
that new interest, under the FASIT proposed regulations, you would be required
to mark the new interests to market and to recognize gain, but would not be
permitted to recognize loss, as though the old interest had been sold for an
amount equal to the fair market value of the new interest. Your basis in the new
interest deemed received in the underlying arrangement would equal your basis in
the FASIT regular interest exchanged for it, increased by any gain you
recognized on the deemed exchange.
Taxation of FASIT Regular Certificates. The FASIT regular certificates
generally will be treated for federal income tax purposes as newly-originated
debt instruments. In general, subject to the discussion below concerning
high-yield regular interests:
- interest, original issue discount and market discount on a FASIT regular
certificate will be treated as ordinary income to the holder of that
certificate, and
- principal payments, other than principal payments that do not exceed
accrued market discount, on a FASIT regular certificate will be treated
as a return of capital to the extent of the holder's basis allocable
thereto.
You must use the accrual method of accounting with respect to FASIT regular
certificate, regardless of the method of accounting you otherwise use.
Except as set forth in the applicable prospectus supplement and in the
immediately following discussion concerning high-yield regular interests, the
discussions above under the headings "--REMICs--Taxation of Owners of REMIC
Regular Certificates--Original Issue Discount," "--Market Discount,"
"--Premium," and "--Realized Losses" will apply to the FASIT regular
certificates. The discussion under the headings "--REMICs--Sale of REMIC Regular
Certificates" will also apply to the FASIT regular certificates, except that the
treatment of a portion of the gain on a REMIC regular interest as ordinary
income to the extent the yield on those certificates did not exceed 110% of the
applicable Federal rate will not apply.
High Yield Regular Interests; Anti-Avoidance Excise Taxes on Tiered
Arrangements. The taxable income, and the alternative minimum taxable income, of
any holder of a high-yield regular interest may not be less than the taxable
income from all high-yield regular interests and FASIT ownership interests that
it holds, together with any excess inclusions with respect to REMIC residual
interests that it owns.
High yield regular interests may only be held by fully taxable, domestic C
corporations or another FASIT. Any attempted transfer of a high-yield regular
interest to any other type of taxpayer will be disregarded, and the transferor
will be required to include in its gross income the amount of income
attributable to the high-yield interest notwithstanding its attempted transfer.
The related Governing Document will contain
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provisions and procedures designed to assure that, in general, only domestic C
corporations or other FASITs may acquire high-yield regular interests. There is
an exception allowing non-corporate taxpayers that hold high-yield regular
interest exclusively for sale to customers in the ordinary course of business to
do so, subject to an excise tax imposed at the corporate income tax rate if the
holder ceases to be a dealer or begins to hold the high-yield regular interest
for investment. Unless otherwise specified in the prospectus supplement, the
related Governing Document will also allow those holders to hold high-yield
regular interests.
To prevent the avoidance of these rules through tiered arrangements, an
excise tax is imposed on any Pass-Through Entity, which, under the FASIT
proposed regulations, includes a REMIC, that:
- holds any FASIT regular interest, whether or not that FASIT regular
interest is a high-yield regular interest; and
- issues a debt or equity interest that is--
1. supported by that FASIT regular interest, and
2. has a yield, higher than the yield on that FASIT regular interest,
that would cause that debt or equity interest to be a high yield
regular interest if it had been issued by a FASIT.
Under the statute, the amount of that tax, which is imposed on the Pass-Through
Entity, is the highest corporate income tax rate applied to the income of the
holder of the debt or equity interest properly attributable to the FASIT regular
interest that supports it. The proposed FASIT regulations provide that the tax
is an excise tax that must be paid on or before the due date of the Pass-Through
Entity's tax return for the taxable year in which it issues that debt or equity
interest. This appears to contemplate a one-time payment on all future income
from the FASIT regular interest that is projected to be properly attributable to
the debt or equity interest it supports. It is not clear how this amount is to
be determined.
Prohibited Transactions and Other Taxes. Income or gain from prohibited
transactions by a FASIT are taxable to the holder of the ownership interest in
that FASIT at a 100% rate. Prohibited transactions generally include, under the
FASIT statutory provisions and proposed FASIT regulations:
- the receipt of income from other than permitted assets;
- the receipt of compensation for services;
- the receipt of any income derived from a loan originated by the FASIT; or
- the disposition of a permitted asset, including disposition in connection
with a cessation of FASIT status, other than for--
1. foreclosure, default, or imminent default of a qualified mortgage,
2. bankruptcy or insolvency of the FASIT,
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3. substitution for another permitted debt instrument or distribution
of the debt instrument to the holder of the ownership interest to
reduce overcollateralization, but only if a principal purpose of
acquiring the debt instrument which is disposed of was not the
recognition of gain, or the reduction of a loss, on the withdrawn
asset as a result of an increase in the market value of the asset
after its acquisition by the FASIT, or
4. the retirement of a class of FASIT regular interests.
The proposed regulations presume that some transactions will be loan
originations, but also provide safe harbors for loans originated by the FASIT.
The proposed safe harbors apply in the following circumstances:
- if the FASIT acquires the loan from an established securities market as
described in Treasury regulation Sections 1.1273-2(f)(2) through (4),
- if the FASIT acquires the loan more than one year after the loan was
issued,
- if the FASIT acquires the loan from a person that regularly originates
similar loans in the ordinary course of business,
- if the FASIT receives any new loan from the same obligor in exchange for
the obligor's original loan in the context of a work out, and
- when the FASIT makes a loan under a contract or agreement in the nature
of a line of credit the FASIT is permitted to hold.
The FASIT provisions generally exclude from prohibited transactions the
substitution of a debt instruments for another debt instrument which is a
permitted asset and the distribution of a debt instrument contributed by the
holder of the ownership interest to that holder in order to reduce
over-collateralization of the FASIT. In addition, the FASIT proposed regulations
also exclude transactions involving the disposition of hedges from the category
of prohibited transactions. However, the proposed regulations deem a
distribution of debt to be carried out principally to recognize gain, and to be
a prohibited transaction, if the owner or related person sells the substituted
or distributed debt instrument at a gain within 180 days of the substitution or
distribution. It is unclear the extent to which tax on those transactions could
be collected from the FASIT directly under the applicable statutes rather than
from the holder of the ownership interest. However, under the related Governing
Document, any prohibited transactions tax that is not payable by a party thereto
as a result of its own actions will be paid by the FASIT. It is not anticipated
that the FASIT will engage in any prohibited transactions.
Taxation of Foreign Investors. The federal income tax treatment of
non-U.S. Persons who own FASIT regular certificates that are not high-yield
regular interests is the same as that described above under "--REMICs--Foreign
Investors in REMIC Regular Certificates." However, if you are a non-U.S. Person
and you hold a regular interest, either directly or indirectly, in a FASIT, you
should note that under the FASIT proposed regulations, interest paid or accrued
on a debt instrument held by the FASIT is
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treated as being received by you directly from a conduit debtor for purposes of
Subtitle A of the Internal Revenue Code and the regulations thereunder if:
- you are a 10% shareholder of an obligor on a debt instrument held by the
FASIT;
- you are a controlled foreign corporation to which an obligor on a debt
instrument held by the FASIT is a related person; or
- you are related to such an obligor that is a corporation or partnership,
in general, having common ownership to a greater than 50% extent.
If you believe you may be in one of these categories, you should consult
with your tax advisors, in particular concerning the possible imposition of
United States withholding taxes at a 30% rate on interest paid with respect to a
FASIT regular interest under these circumstances.
High-yield FASIT regular certificates may not be sold to or beneficially
owned by non-U.S. Persons. Any purported transfer to a non-U.S. Person will be
null and void and, upon the related trustee's discovery of any purported
transfer in violation of this requirement, the last preceding owner of those
FASIT regular certificates will be restored to ownership as completely as
possible. The last preceding owner will, in any event, be taxable on all income
with respect to those FASIT regular certificates for federal income tax
purposes. The related Governing Document will provide that, as a condition to
transfer of a high-yield FASIT regular certificate, the proposed transferee must
furnish an affidavit as to its status as a U.S. Person and otherwise as a
permitted transferee.
Backup Withholding. Payments made on the FASIT regular certificates, and
proceeds from the sale of the FASIT regular certificates to or through some
brokers, may be subject to a backup withholding tax under Section 3406 of the
Internal Revenue Code in the same manner as described under "--REMICs--Backup
Withholding with Respect to REMIC Certificates" above.
Reporting Requirements. Reports of accrued interest, OID, if any, and
information necessary to compute the accrual of any market discount on the FASIT
regular certificates will be made annually to the IRS and to investors in the
same manner as described above under "--REMICs--Reporting and Other
Administrative Matters" above.
GRANTOR TRUSTS
Classification of Grantor Trusts. With respect to each series of grantor
trust certificates, our counsel will deliver its opinion to the effect that,
assuming compliance with all provisions of the related Governing Document, the
related trust, or relevant portion of that trust, will be classified as a
grantor trust under subpart E, part I of subchapter J of the Internal Revenue
Code and not as a partnership or an association taxable as a corporation.
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A grantor trust certificate may be classified as either of the following
types of certificate:
- a grantor trust fractional interest certificate representing an undivided
equitable ownership interest in the principal of the mortgage loans
constituting the related grantor trust, together with interest, if any,
on those loans at a pass-through rate; or
- a grantor trust strip certificate representing ownership of all or a
portion of the difference between--
1. interest paid on the mortgage loans constituting the related grantor
trust, minus
2. the sum of:
- normal administration fees, and
- interest paid to the holders of grantor trust fractional interest
certificates issued with respect to that grantor trust
A grantor trust strip certificate may also evidence a nominal ownership
interest in the principal of the mortgage loans constituting the related grantor
trust.
Characterization of Investments in Grantor Trust Certificates.
Grantor Trust Fractional Interest Certificates. Unless we otherwise
disclose in the related prospectus supplement, any offered certificates that are
grantor trust fractional interest certificates will generally represent
interests in:
- "loans . . . secured by an interest in real property" within the meaning
of Section 7701(a)(19)(C)(v) of the Internal Revenue Code, but only to
the extent that the underlying mortgage loans have been made with respect
to property that is used for residential or other prescribed purposes;
- "obligation[s] (including any participation or certificate of beneficial
ownership therein) which . . . [are] principally secured by an interest
in real property" within the meaning of Section 860G(a)(3) of the
Internal Revenue Code;
- "permitted assets" within the meaning of Section 860L(a)(1)(C) of the
Internal Revenue Code; and
- "real estate assets" within the meaning of Section 856(c)(5)(B) of the
Internal Revenue Code.
In addition, interest on offered certificates that are grantor trust
fractional interest certificates will, to the same extent, be considered
"interest on obligations secured by mortgages on real property or on interests
in real property" within the meaning of Section 856(c)(3)(B) of the Internal
Revenue Code.
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Grantor Trust Strip Certificates. Even if grantor trust strip
certificates evidence an interest in a grantor trust--
- consisting of mortgage loans that are "loans . . . secured by an interest
in real property" within the meaning of Section 7701(a)(19)(C)(v) of the
Internal Revenue Code,
- consisting of mortgage loans that are "real estate assets" within the
meaning of Section 856(c)(5)(B) of the Internal Revenue Code, and
- the interest on which is "interest on obligations secured by mortgages on
real property" within the meaning of Section 856(c)(3)(A) of the Internal
Revenue Code,
it is unclear whether the grantor trust strip certificates, and the income from
those certificates, will be so characterized. We recommend that prospective
purchasers to which the characterization of an investment in grantor trust strip
certificates is material consult their tax advisors regarding whether the
grantor trust strip certificates, and the income from those certificates, will
be so characterized.
The grantor trust strip certificates will be:
- "obligation[s] (including any participation or certificate of beneficial
ownership therein) which . . . [are] principally secured by an interest
in real property" within the meaning of Section 860G(a)(3)(A) of the
Internal Revenue Code, and
- in general, "permitted assets" within the meaning of Section
860L(a)(1)(C) of the Internal Revenue Code.
Taxation of Owners of Grantor Trust Fractional Interest Certificates
General. Holders of a particular series of grantor trust fractional
interest certificates generally:
- will be required to report on their federal income tax returns their
shares of the entire income from the underlying mortgage loans, including
amounts used to pay reasonable servicing fees and other expenses, and
- will be entitled to deduct their shares of any reasonable servicing fees
and other expenses.
Because of stripped interests, market or original issue discount, or
premium, the amount includible in income on account of a grantor trust
fractional interest certificate may differ significantly from interest paid or
accrued on the underlying mortgage loans.
Section 67 of the Internal Revenue Code allows an individual, estate or
trust holding a grantor trust fractional interest certificate directly or
through some types of pass-through entities a deduction for any reasonable
servicing fees and expenses only to the extent that the total of the holder's
miscellaneous itemized deductions exceeds two percent of the holder's adjusted
gross income.
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Section 68 of the Internal Revenue Code reduces the amount of itemized
deductions otherwise allowable for an individual whose adjusted gross income
exceeds a specified amount by the lesser of:
- 3% of the excess of the individual's adjusted gross income over that
amount, and
- 80% of the amount of itemized deductions otherwise allowable for the
taxable year.
The amount of additional taxable income reportable by holders of grantor
trust fractional interest certificates who are subject to the limitations of
either Section 67 or Section 68 of the Internal Revenue Code may be substantial.
Further, certificateholders, other than corporations, subject to the alternative
minimum tax may not deduct miscellaneous itemized deductions in determining
their alternative minimum taxable income.
Although it is not entirely clear, it appears that in transactions in which
multiple classes of grantor trust certificates, including grantor trust strip
certificates, are issued, any fees and expenses should be allocated among those
classes of grantor trust certificates. The method of this allocation should
recognize that each class benefits from the related services. In the absence of
statutory or administrative clarification as to the method to be used, we
currently expect that information returns or reports to the IRS and
certificateholders will be based on a method that allocates these fees and
expenses among classes of grantor trust certificates with respect to each period
based on the payments made to each class during that period.
The federal income tax treatment of grantor trust fractional interest
certificates of any series will depend on whether they are subject to the
stripped bond rules of Section 1286 of the Internal Revenue Code. Grantor trust
fractional interest certificates may be subject to those rules if:
- a class of grantor trust strip certificates is issued as part of the same
series, or
- we or any of our affiliates retain, for our or its own account or for
purposes of resale, a right to receive a specified portion of the
interest payable on an underlying mortgage loan.
Further, the IRS has ruled that an unreasonably high servicing fee retained
by a seller or servicer will be treated as a retained ownership interest in
mortgage loans that constitutes a stripped coupon. We will include in the
related prospectus supplement information regarding servicing fees paid out of
the assets of the related trust to:
- a master servicer,
- a special servicer,
- any sub-servicer, or
- their respective affiliates.
If Stripped Bond Rules Apply. If the stripped bond rules apply, each
grantor trust fractional interest certificate will be treated as having been
issued with original issue
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discount within the meaning of Section 1273(a) of the Internal Revenue Code.
This is subject, however, to the discussion below regarding:
- the treatment of some stripped bonds as market discount bonds, and
- de minimis market discount.
See "--Grantor Trust Funds--Taxation of Owners of Grantor Trust Fractional
Interest Certificates--Market Discount" below.
The holder of a grantor trust fractional interest certificate will report
income from its grantor trust fractional interest certificate for each month to
the extent it constitutes "qualified stated interest" in accordance with its
normal method of accounting. See "REMICs--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount" for a definition of "qualified stated
interest".
The original issue discount on a grantor trust fractional interest
certificate will be the excess of the certificate's stated redemption price over
its issue price. The issue price of a grantor trust fractional interest
certificate as to any purchaser will be equal to the price paid by that
purchaser of the grantor trust fractional interest certificate. The stated
redemption price of a grantor trust fractional interest certificate will be the
sum of all payments to be made on that certificate, other than qualified stated
interest, if any, and the certificate's share of reasonable servicing fees and
other expenses.
See "--Grantor Trust Funds--Taxation of Owners of Grantor Trust Fractional
Interest Certificates--If Stripped Bond Rules Do Not Apply" for a definition of
"qualified stated interest." In general, the amount of that income that accrues
in any month would equal the product of:
- the holder's adjusted basis in the grantor trust fractional interest
certificate at the beginning of the related month, as defined in
"--Grantor Trust Funds--Sales of Grantor Trust Certificates," and
- the yield of that grantor trust fractional interest certificate to the
holder.
The yield would be computed as the rate, that, if used to discount the
holder's share of future payments on the related mortgage loans, would cause the
present value of those future payments to equal the price at which the holder
purchased the certificate. This rate is compounded based on the regular interval
between payment dates. In computing yield under the stripped bond rules, a
certificateholder's share of future payments on the related mortgage loans will
not include any payments made with respect to any ownership interest in those
mortgage loans retained by us, a master servicer, a special servicer, a
sub-servicer or our or their respective affiliates, but will include the
certificateholder's share of any reasonable servicing fees and other expenses.
With respect to some categories of debt instruments, Section 1272(a)(6) of
the Internal Revenue Code requires the use of a reasonable prepayment assumption
in accruing original issue discount, and adjustments in the accrual of original
issue discount when prepayments do not conform to the prepayment assumption.
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Legislation enacted in 1997 extended the scope of that section to any pool
of debt instruments the yield on which may be affected by reason of prepayments,
effective for taxable years beginning after enactment. The precise application
of this legislation is unclear in some respects. For example, it is uncertain
whether a prepayment assumption will be applied collectively to all a taxpayer's
investments in pools of debt instruments, or on an investment-by-investment
basis. Similarly, it is not clear whether the assumed prepayment rate as to
investments in grantor trust fractional interest certificates is to be
determined based on conditions at the time of the first sale of the certificate
or, with respect to any holder, at the time of purchase of the certificate by
that holder.
We recommend that certificateholders consult their tax advisors concerning
reporting original issue discount with respect to grantor trust fractional
interest certificates.
In the case of a grantor trust fractional interest certificate acquired at
a price equal to the principal amount of the related mortgage loans allocable to
that certificate, the use of a prepayment assumption generally would not have
any significant effect on the yield used in calculating accruals of interest
income. In the case, however, of a grantor trust fractional interest certificate
acquired at a price less than or greater than the principal amount,
respectively, the use of a reasonable prepayment assumption would increase or
decrease the yield. Therefore, the use of this prepayment assumption would
accelerate or decelerate, respectively, the reporting of income.
In the absence of statutory or administrative clarification, we currently
expect that information reports or returns to the IRS and certificateholders
will be based on:
- a prepayment assumption determined when certificates are offered and sold
hereunder, which we will disclose in the related prospectus supplement,
and
- a constant yield computed using a representative initial offering price
for each class of certificates.
However, neither we nor any other person will make any representation
that--
- the mortgage loans in any of our trusts will in fact prepay at a rate
conforming to the prepayment assumption used or any other rate, or
- the prepayment assumption will not be challenged by the IRS on audit.
Certificateholders also should bear in mind that the use of a
representative initial offering price will mean that the information returns or
reports that we send, even if otherwise accepted as accurate by the IRS, will in
any event be accurate only as to the initial certificateholders of each series
who bought at that price.
Under Treasury Regulation Section 1.1286-1, some stripped bonds are to be
treated as market discount bonds. Accordingly, any purchaser of that bond is to
account for any discount on the bond as market discount rather than original
issue discount. This treatment only applies, however, if immediately after the
most recent disposition of the
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bond by a person stripping one or more coupons from the bond and disposing of
the bond or coupon:
- there is no original issue discount or only a de minimis amount of
original issue discount, or
- the annual stated rate of interest payable on the original bond is no
more than one percentage point lower than the gross interest rate payable
on the related mortgage loans, before subtracting any servicing fee or
any stripped coupon.
If interest payable on a grantor trust fractional interest certificate is
more than one percentage point lower than the gross interest rate payable on the
related mortgage loans, we will disclose that fact in the related prospectus
supplement. If the original issue discount or market discount on a grantor trust
fractional interest certificate determined under the stripped bond rules is less
than the product of:
- 0.25% of the stated redemption price, and
- the weighted average maturity of the related mortgage loans,
then the original issue discount or market discount will be considered to be de
minimis. Original issue discount or market discount of only a de minimis amount
will be included in income in the same manner as de minimis original issue
discount and market discount described in "--Grantor Trust Funds--Taxation of
Owners of Grantor Trust Fractional Interest Certificates--If Stripped Bond Rules
Do Not Apply" and "--Market Discount" below.
If Stripped Bond Rules Do Not Apply. Subject to the discussion below on
original issue discount, if the stripped bond rules do not apply to a grantor
trust fractional interest certificate, the certificateholder will be required to
report its share of the interest income on the related mortgage loans in
accordance with the certificateholder's normal method of accounting. In that
case, the original issue discount rules will apply, even if the stripped bond
rules do not apply, to a grantor trust fractional interest certificate to the
extent it evidences an interest in mortgage loans issued with original issue
discount.
The original issue discount, if any, on mortgage loans will equal the
difference between:
- the stated redemption price of the mortgage loans, and
- their issue price.
For a definition of "stated redemption price," see "--REMICs--Taxation of
Owners of REMIC Regular Certificates--Original Issue Discount" above. In
general, the issue price of a mortgage loan will be the amount received by the
borrower from the lender under the terms of the mortgage loan. If the borrower
separately pays points to the lender that are not paid for services provided by
the lender, such as commitment fees or loan processing costs, the amount of
those points paid reduces the issue price.
The stated redemption price of a mortgage loan will generally equal its
principal amount. The determination as to whether original issue discount will
be considered to be de minimis will be calculated using the same test as in the
REMIC discussion. See
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"--REMICs--Taxation of Owners of REMIC Regular Certificates--Original Issue
Discount" above.
In the case of mortgage loans bearing adjustable or variable interest
rates, we will describe in the related prospectus supplement the manner in which
these rules will be applied with respect to the mortgage loans by the related
trustee or master servicer, as applicable, in preparing information returns to
certificateholders and the IRS.
If original issue discount is in excess of a de minimis amount, all
original issue discount with respect to a mortgage loan will be required to be
accrued and reported in income each month, based on a constant yield. Under
legislation enacted in 1997, Section 1272(a)(6) of the Internal Revenue Code
requires that a prepayment assumption be used in computing yield with respect to
any pool of debt instruments, the yield on which may be affected by prepayments.
The precise application of this legislation is unclear in some respects. For
example, it is uncertain whether a prepayment assumption will be applied
collectively to all a taxpayer's investments in pools of debt instruments, or
will be applied on an investment-by-investment basis. Similarly, it is not clear
whether the assumed prepayment rate as to investments in grantor trust
fractional interest certificates is to be determined based on conditions at the
time of the first sale of the certificate or, with respect to any holder, at the
time of purchase of the certificate by that holder. We recommend that
certificateholders consult their own tax advisors concerning reporting original
issue discount with respect to grantor trust fractional interest certificates.
A purchaser of a grantor trust fractional interest certificate may purchase
the grantor trust fractional interest certificate at a cost less than the
certificate's allocable portion of the total remaining stated redemption price
of the underlying mortgage loans. In that case, the purchaser will also be
required to include in gross income the certificate's daily portions of any
original issue discount with respect to those mortgage loans. However, each
daily portion will be reduced, if the cost of the grantor trust fractional
interest certificate to the purchaser is in excess of the certificate's
allocable portion of the aggregate adjusted issue prices of the underlying
mortgage loans. The reduction will be approximately in proportion to the ratio
that the excess bears to the certificate's allocable portion of the total
original issue discount remaining to be accrued on those mortgage loans.
The adjusted issue price of a mortgage loan on any given day equals the sum
of:
- the adjusted issue price or the issue price, in the case of the first
accrual period, of the mortgage loan at the beginning of the accrual
period that includes that day, and
- the daily portions of original issue discount for all days during the
accrual period prior to that day.
The adjusted issue price of a mortgage loan at the beginning of any accrual
period will equal:
- the issue price of the mortgage loan, increased by
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- the total amount of original issue discount with respect to the mortgage
loan that accrued in prior accrual periods, and reduced by
- the amount of any payments made on the mortgage loan in prior accrual
periods of amounts included in its stated redemption price.
In the absence of statutory or administrative clarification, we currently
expect that information reports or returns to the IRS and certificateholders
will be based on:
- a prepayment assumption determined when the certificates are offered and
sold hereunder and disclosed in the related prospectus supplement, and
- a constant yield computed using a representative initial offering price
for each class of certificates.
However, neither we nor any other person will make any representation
that--
- the mortgage loans will in fact prepay at a rate conforming to the
prepayment assumption or any other rate, or
- the prepayment assumption will not be challenged by the IRS on audit.
Certificateholders also should bear in mind that the use of a
representative initial offering price will mean that the information returns or
reports, even if otherwise accepted as accurate by the IRS, will in any event be
accurate only as to the initial certificateholders of each series who bought at
that price.
Market Discount. If the stripped bond rules do not apply to a grantor
trust fractional interest certificate, a certificateholder may be subject to the
market discount rules of Sections 1276 through 1278 of the Internal Revenue Code
to the extent an interest in a mortgage loan is considered to have been
purchased at a market discount. A mortgage loan is considered to have been
purchased at a market discount if--
- in the case of a mortgage loan issued without original issue discount, it
is purchased at a price less than its remaining stated redemption price,
or
- in the case of a mortgage loan issued with original issue discount, it is
purchased at a price less than its adjusted issue price.
If market discount is in excess of a de minimis amount, the holder
generally must include in income in each month the amount of the discount that
has accrued, under the rules described in the next paragraph, through that month
that has not previously been included in income. The inclusion will be limited,
in the case of the portion of the discount that is allocable to any mortgage
loan, to the payment of stated redemption price on the mortgage loan that is
received by or, for accrual method certificateholders, due to the trust in that
month. A certificateholder may elect to include market discount in income
currently as it accrues, under a constant yield method based on the yield of the
certificate to the holder, rather than including it on a deferred basis in
accordance with the foregoing under rules similar to those described in
"--REMICs--Taxation of Owners of REMIC Regular Interests--Market Discount"
above.
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Section 1276(b)(3) of the Internal Revenue Code authorizes the Treasury
Department to issue regulations providing for the method for accruing market
discount on debt instruments, the principal of which is payable in more than one
installment. Until the time that regulations are issued by the Treasury
Department, the relevant rules described in the Committee Report apply. Under
those rules, in each accrual period, you may accrue market discount on the
underlying mortgage loans, at your option:
- on the basis of a constant yield method,
- in the case of a mortgage loan issued without original issue discount, in
an amount that bears the same ratio to the total remaining market
discount as the stated interest paid in the accrual period bears to the
total stated interest remaining to be paid on the mortgage loan as of the
beginning of the accrual period, or
- in the case of a mortgage loan issued with original issue discount, in an
amount that bears the same ratio to the total remaining market discount
as the original issue discount accrued in the accrual period bears to the
total original issue discount remaining at the beginning of the accrual
period.
Under legislation enacted in 1997, Section 1272(a)(6) of the Internal
Revenue Code requires that a prepayment assumption be used in computing the
accrual of original issue discount with respect to any pool of debt instruments,
the yield on which may be affected by prepayments. Because the mortgage loans
will be a pool described in that section, it appears that the prepayment
assumption used, or that would be used, in calculating the accrual of original
issue discount, if any, is also to be used in calculating the accrual of market
discount. However, the precise application of the new legislation is unclear in
some respects. For example, it is uncertain whether a prepayment assumption will
be applied collectively to all of a taxpayer's investments in pools of debt
instruments, or on an investment-by-investment basis. Similarly, it is not clear
whether the assumed prepayment rate is to be determined at the time of the first
sale of the grantor trust fractional interest certificate, or with respect to
any holder, at the time of that holder's purchase of the grantor trust
fractional interest certificate.
We recommend that certificateholders consult their own tax advisors
concerning accrual of market discount with respect to grantor trust fractional
interest certificates. Certificateholders should also refer to the related
prospectus supplement to determine whether and in what manner the market
discount will apply to the underlying mortgage loans purchased at a market
discount.
To the extent that the underlying mortgage loans provide for periodic
payments of stated redemption price, you may be required to include market
discount in income at a rate that is not significantly slower than the rate at
which that discount would be included in income if it were original issue
discount.
Market discount with respect to mortgage loans may be considered to be de
minimis and, if so, will be includible in income under de minimis rules similar
to those described under "--REMICs--Taxation of Owners of REMIC Regular
Certificates--Original Issue Discount" above.
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Further, under the rules described under "--REMICs--Taxation of Owners of
REMIC Regular Certificates--Market Discount" above, any discount that is not
original issue discount and exceeds a de minimis amount may require the deferral
of interest expense deductions attributable to accrued market discount not yet
includible in income, unless an election has been made to report market discount
currently as it accrues. This rule applies without regard to the origination
dates of the underlying mortgage loans.
Premium. If a certificateholder is treated as acquiring the underlying
mortgage loans at a premium, which is a price in excess of their remaining
stated redemption price, the certificateholder may elect under Section 171 of
the Internal Revenue Code to amortize the portion of that premium allocable to
mortgage loans originated after September 27, 1985 using a constant yield
method. Amortizable premium is treated as an offset to interest income on the
related debt instrument, rather than as a separate interest deduction. However,
premium allocable to mortgage loans originated before September 28, 1985 or to
mortgage loans for which an amortization election is not made, should:
- be allocated among the payments of stated redemption price on the
mortgage loan, and
- be allowed as a deduction as those payments are made or, for an accrual
method certificateholder, due.
It appears that a prepayment assumption should be used in computing
amortization of premium allowable under Section 171 of the Internal Revenue Code
similar to that described for calculating the accrual of market discount of
grantor trust fractional interest certificates. See "--Grantor Trust
Funds--Taxation of Owners of Grantor Trust Fractional Interest
Certificates--Market Discount" above.
Taxation of Owners of Grantor Trust Strip Certificates. The stripped
coupon rules of Section 1286 of the Internal Revenue Code will apply to the
grantor trust strip certificates. Except as described above under "--Grantor
Trust Funds--Taxation of Owners of Grantor Trust Fractional Interest
Certificates--If Stripped Bond Rules Apply," no regulations or published rulings
under Section 1286 of the Internal Revenue Code have been issued and some
uncertainty exists as to how it will be applied to securities, such as the
grantor trust strip certificates. Accordingly, we recommend that you consult
your tax advisors concerning the method to be used in reporting income or loss
with respect to those certificates.
The Treasury regulations promulgated under the original discount rules do
not apply to stripped coupons, although they provide general guidance as to how
the original issue discount sections of the Internal Revenue Code will be
applied.
Under the stripped coupon rules, it appears that original issue discount
will be required to be accrued in each month on the grantor trust strip
certificates based on a constant yield method. In effect, you would include as
interest income in each month an amount equal to the product of your adjusted
basis in the grantor trust strip certificate at
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the beginning of that month and the yield of the grantor trust strip certificate
to you. This yield would be calculated based on:
- the price paid for that grantor trust strip certificate by you, and
- the projected payments remaining to be made on that grantor trust strip
certificate at the time of the purchase, plus
- an allocable portion of the projected servicing fees and expenses to be
paid with respect to the underlying mortgage loans.
See "--Grantor Trust Funds--Taxation of Owners of Grantor Trust Fractional
Interest Certificates--If Stripped Bond Rules Apply" above.
As noted above, Section 1272(a)(6) of the Internal Revenue Code requires
that a prepayment assumption be used in computing the accrual of original issue
discount with respect to some categories of debt instruments. The Internal
Revenue Code also requires adjustments be made in the amount and rate of accrual
of that discount when prepayments do not conform to the prepayment assumption.
It appears that those provisions would apply to grantor trust strip
certificates. It is uncertain whether the assumed prepayment rate would be
determined based on:
- conditions at the time of the first sale of the grantor trust strip
certificate or,
- with respect to any subsequent holder, at the time of purchase of the
grantor trust strip certificate by that holder.
If the method for computing original issue discount under Section
1272(a)(6) results in a negative amount of original issue discount as to any
accrual period with respect to a grantor trust strip certificate, the amount of
original issue discount allocable to that accrual period will be zero. That is,
no current deduction of the negative amount will be allowed to you. You will
instead only be permitted to offset that negative amount against future positive
original issue discount, if any, attributable to that certificate. Although not
free from doubt, it is possible that you may be permitted to deduct a loss to
the extent his or her basis in the certificate exceeds the maximum amount of
payments you could ever receive with respect to that certificate. However, the
loss may be a capital loss, which is limited in its deductibility. The foregoing
considerations are particularly relevant to grantor trust certificates with no,
or disproportionately small, amounts of principal, which can have negative
yields under circumstances that are not default related. See "Risk Factors--The
Investment Performance of Your Offered Certificates Depend Upon Payments,
Defaults and Losses on the Underlying Mortgage Loans".
The accrual of income on the grantor trust strip certificates will be
significantly slower using a prepayment assumption than if yield is computed
assuming no prepayments. In the absence of statutory or administrative
clarification, we currently
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expect that information returns or reports to the IRS and certificateholders
will be based on:
- the prepayment assumption we will disclose in the related prospectus
supplement, and
- a constant yield computed using a representative initial offering price
for each class of certificates.
However, neither we nor any other person will make any representation
that--
- the mortgage loans in any of our trusts will in fact prepay at a rate
conforming to the prepayment assumption or at any other rate or
- the prepayment assumption will not be challenged by the IRS on audit.
We recommend that prospective purchasers of the grantor trust strip
certificates consult their tax advisors regarding the use of the prepayment
assumption.
Certificateholders also should bear in mind that the use of a
representative initial offering price will mean that the information returns or
reports, even if otherwise accepted as accurate by the IRS, will in any event be
accurate only as to the initial certificateholders of each series who bought at
that price.
Sales of Grantor Trust Certificates. Any gain or loss recognized on the
sale or exchange of a grantor trust certificate by an investor who holds that
certificate as a capital asset, will be capital gain or loss, except as
described below in this "--Sales of Grantor Trust Certificates" subsection. The
amount recognized equals the difference between:
- the amount realized on the sale or exchange of a grantor trust
certificate, and
- its adjusted basis.
The adjusted basis of a grantor trust certificate generally will equal:
- its cost, increased by
- any income reported by the seller, including original issue discount and
market discount income, and reduced, but not below zero, by
- any and all previously reported losses, amortized premium, and payments
with respect to that grantor trust certificate.
As of the date of this prospectus, the Internal Revenue Code provides for
lower rates as to long-term capital gains, than those applicable to the
short-term capital gains and ordinary income realized or received by
individuals. No similar rate differential exists for corporations. In addition,
the distinction between a capital gain or loss and ordinary income or loss
remains relevant for other purposes.
Gain or loss from the sale of a grantor trust certificate may be partially
or wholly ordinary and not capital in some circumstances. Gain attributable to
accrued and unrecognized market discount will be treated as ordinary income.
Gain or loss recognized
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by banks and other financial institutions subject to Section 582(c) of the
Internal Revenue Code will be treated as ordinary income.
Furthermore, a portion of any gain that might otherwise be capital gain may
be treated as ordinary income to the extent that the grantor trust certificate
is held as part of a "conversion transaction" within the meaning of Section 1258
of the Internal Revenue Code. A conversion transaction generally is one in which
the taxpayer has taken two or more positions in the same or similar property
that reduce or eliminate market risk, if substantially all of the taxpayer's
return is attributable to the time value of the taxpayer's net investment in the
transaction. The amount of gain realized in a conversion transaction that is
recharacterized as ordinary income generally will not exceed the amount of
interest that would have accrued on the taxpayer's net investment at 120% of the
appropriate applicable Federal rate at the time the taxpayer enters into the
conversion transaction, subject to appropriate reduction for prior inclusion of
interest and other ordinary income items from the transaction.
The Internal Revenue Code requires the recognition of gain upon the
constructive sale of an appreciated financial position. A constructive sale of
an appreciated financial position occurs if a taxpayer enters into a transaction
or series of transactions that have the effect of substantially eliminating the
taxpayer's risk of loss and opportunity for gain with respect to the financial
instrument. Debt instruments that--
- entitle the holder to a specified principal amount,
- pay interest at a fixed or variable rate, and
- are not convertible into the stock of the issuer or a related party,
cannot be the subject of a constructive sale for this purpose. Because most
grantor trust certificates meet this exception, this Section will not apply to
most grantor trust certificates. However, some grantor trust certificates have
no, or a disproportionately small amount of, principal and these certificates
can be the subject of a constructive sale.
Finally, a taxpayer may elect to have net capital gain taxed at ordinary
income rates rather than capital gains rates in order to include the net capital
gain in total net investment income for the relevant taxable year. This election
would be done for purposes of the rule that limits the deduction of interest on
indebtedness incurred to purchase or carry property held for investment to a
taxpayer's net investment income.
Grantor Trust Reporting. Unless otherwise provided in the related
prospectus supplement, the related tax administrator will furnish or make
readily available through electronic means to each holder of a grantor trust
certificate with each payment a statement setting forth the amount of the
payment allocable to principal on the underlying mortgage loans and to interest
on those loans at the related pass-through rate. In addition, the related tax
administrator will furnish, within a reasonable time after the end of each
calendar year, to each person or entity that was the holder of a grantor trust
certificate at any time during that year, information regarding:
- the amount of servicing compensation received by a master servicer or
special servicer, and
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- all other customary factual information the reporting party deems
necessary or desirable to enable holders of the related grantor trust
certificates to prepare their tax returns.
The reporting party will furnish comparable information to the IRS as and
when required by law to do so.
Because the rules for accruing discount and amortizing premium with respect
to grantor trust certificates are uncertain in various respects, there is no
assurance the IRS will agree with the information reports of those items of
income and expense. Moreover, those information reports, even if otherwise
accepted as accurate by the IRS, will in any event be accurate only as to the
initial certificateholders that bought their certificates at the representative
initial offering price used in preparing the reports.
On August 13, 1998, the Service published proposed regulations, which will,
when effective, establish a reporting framework for interests in "widely held
fixed investment trusts" similar to that for regular interests in REMICs. A
widely-held fixed investment trust is defined as any entity classified as a
"trust" under Treasury Regulation Section 301.7701-4(c) in which any interest is
held by a middleman, which includes, but is not limited to:
- a custodian of a person's account,
- a nominee, and
- a broker holding an interest for a customer in street name.
These regulations are proposed to be effective for calendar years beginning
on or after the date that the final regulations are published in the Federal
Register.
Backup Withholding. In general, the rules described under
"--REMICs--Backup Withholding with Respect to REMIC Certificates" above will
also apply to grantor trust certificates.
Foreign Investors. In general, the discussion with respect to REMIC
regular certificates under "--REMICs--Foreign Investors in REMIC Certificates"
above applies to grantor trust certificates. However, unless we otherwise
specify in the related prospectus supplement, grantor trust certificates will be
eligible for exemption from U.S. withholding tax, subject to the conditions
described in the discussion above, only to the extent the related mortgage loans
were originated after July 18, 1984.
To the extent that interest on a grantor trust certificate would be exempt
under Sections 871(h)(1) and 881(c) of the Internal Revenue Code from United
States withholding tax, and the certificate is not held in connection with a
certificateholder's trade or business in the United States, the certificate will
not be subject to United States estate taxes in the estate of a nonresident
alien individual.
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STATE AND OTHER TAX CONSEQUENCES
In addition to the federal income tax consequences described in "Federal
Income Tax Consequences," potential investors should consider the state and
local tax consequences concerning the offered certificates. State tax law may
differ substantially from the corresponding federal law, and the discussion
above does not purport to describe any aspect of the tax laws of any state or
other jurisdiction. Therefore, we recommend that prospective investors consult
their tax advisors with respect to the various tax consequences of investments
in the offered certificates.
ERISA CONSIDERATIONS
GENERAL
The Employee Retirement Income Security Act of 1974, as amended, and the
Internal Revenue Code of 1986 impose various requirements on--
- ERISA Plans, and
- persons that are fiduciaries with respect to ERISA Plans,
in connection with the investment of the assets of an ERISA Plan. For purposes
of this discussion, ERISA Plans may include individual retirement accounts and
annuities, Keogh plans and collective investment funds and separate accounts,
including as applicable, insurance company general accounts, in which other
ERISA Plans are invested.
Governmental plans and, if they have not made an election under Section
410(d) of the Internal Revenue Code of 1986, church plans are not subject to
ERISA requirements. Accordingly, assets of those plans may be invested in the
offered certificates without regard to the considerations described below in
this "ERISA Considerations" section, subject to the provisions of other
applicable federal and state law. Any of those plans which is qualified and
exempt from taxation under Sections 401(a) and 501(a) of the Internal Revenue
Code of 1986, however, is subject to the prohibited transaction rules in Section
503 of that Code.
ERISA imposes general fiduciary requirements on a fiduciary that is
investing the assets of an ERISA Plan, including--
- investment prudence and diversification, and
- compliance with the investing ERISA Plan's governing the documents.
Section 406 of ERISA and Section 4975 of the Internal Revenue Code of 1986
also prohibit a broad range of transactions involving the assets of an ERISA
Plan and a Party in Interest with respect to that ERISA Plan, unless a statutory
or administrative exemption exists.
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The types of transactions between ERISA Plans and Parties in Interest that
are prohibited include:
- sales, exchanges or leases of property;
- loans or other extensions of credit; and
- the furnishing of goods and services.
Parties in Interest that participate in a prohibited transaction may be
subject to an excise tax imposed under Section 4975 of the Internal Revenue Code
of 1986 or a penalty imposed under Section 502(i) of ERISA, unless a statutory
or administrative exemption is available. In addition, the persons involved in
the prohibited transaction may have to cancel the transaction and pay an amount
to the affected ERISA Plan for any losses realized by that ERISA Plan or profits
realized by those persons. In addition, individual retirement accounts involved
in the prohibited transaction may be disqualified which would result in adverse
tax consequences to the owner of the account.
PLAN ASSET REGULATIONS
An ERISA Plan's investment in offered certificates may cause the underlying
mortgage assets and other assets of the related trust to be deemed assets of
that ERISA Plan. Section 2510.3-101 of the Plan Asset Regulations provides that
when an ERISA Plan acquires an equity interest in an entity, the assets that
ERISA Plan or arrangement include both that equity interest and an undivided
interest in each of the underlying assets of the entity, unless an exception
applies. One exemption is that the equity participation in the entity by benefit
plan investors, which include both ERISA Plans and some employee benefit plans
not subject to ERISA, is not significant. The equity participation by benefit
plan investors will be significant on any date if 25% or more of the value of
any class of equity interests in the entity is held by benefit plan investors.
The percentage owned by benefit plan investors is determined by excluding the
investments of the following persons:
1. those with discretionary authority or control over the assets of the
entity,
2. those who provide investment advice directly or indirectly for a fee
with respect to the assets of the entity, and
3. those who are affiliates of the persons described in the preceding
clauses 1.
and 2.
In the case of one of our trusts, investments by us, by the related
trustee, the related master servicer, the related special servicer or any other
party with discretionary authority over the related trust assets, or by the
affiliates of these persons, will be excluded.
A fiduciary of an investing ERISA Plan is any person who--
- has discretionary authority or control over the management or disposition
of the assets of that ERISA Plan, or
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- provides investment advice with respect to the assets of that ERISA Plan
for a fee.
If the mortgages and other assets included in one of our trusts are ERISA
Plan assets, then any party exercising management or discretionary control
regarding those assets, such as the related trustee, master servicer or special
servicer, or affiliates of any of these parties, may be--
- deemed to be a fiduciary with respect to the investing ERISA Plan, and
- subject to the fiduciary responsibility provisions of ERISA.
In addition, if the mortgages and other assets included in one of our trusts are
ERISA Plan assets, then the operation of that trust may involve prohibited
transactions under ERISA or the Code. For example, if a borrower with respect to
a mortgage loan in that trust is a Party in Interest to an investing ERISA Plan,
then the purchase by that ERISA Plan of offered certificates evidencing
interests in that trust, could be a prohibited loan between that ERISA Plan and
the Party in Interest.
The Plan Asset Regulations provide that where an ERISA Plan purchases a
"guaranteed governmental mortgage pool certificate," the assets of that ERISA
Plan include the certificate but do not include any of the mortgages underlying
the certificate. The Plan Asset Regulations include in the definition of a
"guaranteed governmental mortgage pool certificate" some certificates issued
and/or guaranteed by Freddie Mac, Ginnie Mae, Fannie Mae or Farmer Mac.
Accordingly, even if these types of mortgaged-backed securities were deemed to
be assets of an ERISA Plan, the underlying mortgages would not be treated as
assets of that ERISA Plan. Private label mortgage participations, mortgage
pass-through certificates or other mortgage-backed securities are not
"guaranteed governmental mortgage pool certificates" within the meaning of the
Plan Asset Regulations.
In addition, the acquisition or holding of offered certificates by or on
behalf of an ERISA Plan could give rise to a prohibited transaction if we or the
related trustee, master servicer or special servicer or any related underwriter,
sub-servicer, tax administrator, manager, borrower or obligor under any credit
enhancement mechanism, or one of their affiliates, is or becomes a Party in
Interest with respect to an investing ERISA Plan.
If you are the fiduciary of an ERISA Plan, you should consult your counsel
and review the ERISA discussion in the related prospectus supplement before
purchasing any offered certificates.
PROHIBITED TRANSACTION EXEMPTIONS
If you are an ERISA Plan fiduciary, then, in connection with your deciding
whether to purchase any of the offered certificates on behalf of an ERISA Plan,
you should
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consider the availability of one of the following prohibited transaction class
exemptions issued by the U.S. Department of Labor:
- Prohibited Transaction Class Exemption 75-1, which exempts particular
transactions involving ERISA Plans and broker-dealers, reporting dealers
and banks;
- Prohibited Transaction Class Exemption 90-1, which exempts particular
transactions between insurance company separate accounts and Parties in
Interest;
- Prohibited Transaction Class Exemption 91-38, which exempts particular
transactions between bank collective investment funds and Parties in
Interest;
- Prohibited Transaction Class Exemption 84-14, which exempts particular
transactions effected on behalf of an ERISA Plan by a "qualified
professional asset manager;"
- Prohibited Transaction Class Exemption 95-60, which exempts particular
transactions between insurance company general accounts and Parties in
Interest; and
- Prohibited Transaction Class Exemption 96-23, which exempts particular
transactions effected on behalf of an ERISA Plan by an "in-house asset
manager."
We cannot provide any assurance that any of these class exemptions will
apply with respect to any particular investment by or on behalf of an ERISA Plan
in any class of offered certificates. Furthermore, even if any of them were
deemed to apply, that particular class exemption may not apply to all
transactions that could occur in connection with the investment. The prospectus
supplement with respect to the offered certificates of any series may contain
additional information regarding the availability of other exemptions, with
respect to those certificates.
UNDERWRITER'S EXEMPTION
It is expected that Salomon Smith Barney Inc. will be the sole, lead or
co-lead underwriter in each underwritten offering of certificates made by this
prospectus. The U.S. Department of Labor issued Prohibited Transaction Exemption
91-23 to a predecessor in interest to Salomon Smith Barney Inc. Subject to the
satisfaction of the conditions specified in that exemption, PTE 91-23, as
amended, generally exempts from the application of the prohibited transaction
provisions of ERISA and the Internal Revenue Code of 1986, various transactions
relating to, among other things--
- the servicing and operation of some mortgage assets pools, such as the
types of mortgage asset pools that will be included in our trusts, and
- the purchase, sale and holding of some certificates evidencing interests
in those pools that are underwritten by Salomon Smith Barney Inc. or any
person affiliated with Salomon Smith Barney Inc., such as particular
classes of the offered certificates.
The related prospectus supplement will state whether PTE 91-23, as amended,
is or may be available with respect to any offered certificates underwritten by
Salomon Smith Barney Inc.
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INSURANCE COMPANY GENERAL ACCOUNTS
The Small Business Job Protection Act of 1996 added a new Section 401(c) to
ERISA, which provides relief from the fiduciary and prohibited transaction
provisions of ERISA and the Internal Revenue Code of 1986 for transactions
involving an insurance company general account. This exemption is in addition to
any exemption that may be available under prohibited transaction class exemption
95-60 for the purchase and holding of offered certificates by an insurance
company general account.
Under Section 401(c) of ERISA, the U.S. Department of Labor issued a final
regulation on January 5, 2000, providing guidance for determining, in cases
where insurance policies supported by an insurer's general account are issued to
or for the benefit of an ERISA Plan on or before December 31, 1998, which
general account assets are ERISA Plan assets. That regulation generally provides
that, if the specified requirements are satisfied with respect to insurance
policies issued on or before December 31, 1998, the assets of an insurance
company general account will not be ERISA Plan assets.
Any assets of an insurance company general account which support insurance
policies issued to an ERISA Plan after December 31, 1998, or issued to an ERISA
Plan on or before December 31, 1998 for which the insurance company does not
comply with the requirements set forth in the final regulation under Section
401(c) of ERISA, may be treated as ERISA Plan assets. In addition, because
Section 401(c) of ERISA and the regulation issued under Section 401(c) of ERISA
do not relate to insurance company separate accounts, separate account assets
are still treated as ERISA Plan assets, invested in the separate account. If you
are an insurance company are contemplating the investment of general account
assets in offered certificates, you should consult your legal counsel as to the
applicability of Section 401(c) of ERISA.
CONSULTATION WITH COUNSEL
If you are a fiduciary for an ERISA Plan and you intend to purchase offered
certificates on behalf of or with assets of that ERISA Plan, you should:
- consider your general fiduciary obligations under ERISA, and
- consult with your legal counsel as to--
1. the potential applicability of ERISA and the Internal Revenue Code
of 1986 to investment, and
2. the availability of any prohibited transaction exemption in
connection with investment.
TAX EXEMPT INVESTORS
An ERISA Plan that is exempt from federal income taxation under Section 501
of the Internal Revenue Code of 1986 will be subject to federal income taxation
to the extent that its income is "unrelated business taxable income" within the
meaning of Section 512 of the Internal Revenue Code of 1986. All excess
inclusions of a REMIC
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allocated to a REMIC residual certificate held by a tax-exempt ERISA Plan will
be considered unrelated business taxable income and will be subject to federal
income tax.
See "Federal Income Tax Consequences--REMICs--Taxation of Owners of REMIC
Residual Certificates--Excess Inclusions" in this prospectus.
LEGAL INVESTMENT
If and to the extent specified in the related prospectus supplement, the
offered certificates of any series may constitute mortgage related securities
for purposes of the Secondary Mortgage Market Enhancement Act of 1984. Mortgage
related securities are legal investments for entities--
- that are created or existing under the laws of the United States or any
state, including the District of Columbia and Puerto Rico, and
- whose authorized investments are subject to state regulations,
to the same extent that, under applicable law, obligations issued by or
guaranteed as to principal and interest by the United States or any of its
agencies or instrumentalities are legal investments for those entities.
Prior to December 31, 1996, classes of offered certificates would be
mortgage related securities for purposes of SMMEA only if they:
- were rated in one of the two highest rating categories by at least one
nationally recognized statistical rating organization; and
- evidenced interests in a trust consisting of loans directly secured by a
first lien on a single parcel of real estate upon which is located a
dwelling or mixed residential and commercial structure, which loans had
been originated by the types of originators specified in SMMEA.
Further, under SMMEA as originally enacted, if a state enacted legislation
on or before October 3, 1991 that specifically limited the legal investment
authority of any entities referred to in the preceding paragraph with respect to
mortgage related securities under that definition, offered certificates would
constitute legal investments for entities subject to the legislation only to the
extent provided in that legislation. A number of states enacted laws limiting
the authority of certain entities, particularly insurance companies, to invest
in "mortgage related securities."
Effective December 31, 1996, the definition of "mortgage related security"
was modified to include among the types of loans to which the securities may
relate, loans secured by first liens on "one or more parcels of real estate upon
which is located one or more commercial structures." In addition, the related
legislative history states that this expanded definition includes multifamily
loans secured by more than one parcel of real estate upon which is located more
than one structure. Through September 23, 2001, any state may enact legislation
limiting the extent to which mortgage related securities under this expanded
definition would constitute legal investments under that state's laws. However,
any limiting legislation cannot affect the validity of a contract to purchase,
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hold or invest in, or require the sale or disposition of, mortgage related
securities, if the contract or purchase predated that legislation.
SMMEA also amended the legal investment authority of federally chartered
depository institutions as follows:
- federal savings and loan associations and federal savings banks may
invest in, sell or otherwise deal with mortgage related securities
without limitation as to the percentage of their assets represented by
those securities; and
- federal credit unions may invest in mortgage related securities and
national banks may purchase mortgage related securities for their own
account without regard to the limitations generally applicable to
investment securities prescribed in 12 U.S.C. 24 (Seventh),
subject in each case to the regulations that the applicable federal regulatory
authority may prescribe.
The OCC has amended 12 C.F.R. Part 1 to authorize national banks to
purchase and sell for their own account, without limitation as to a percentage
of the bank's capital and surplus, but subject to compliance with general
standards in 12 C.F.R. sec.1.5 concerning "safety and soundness" and retention
of credit information, "Type IV securities," which are defined in 12 C.F.R.
sec.1.2(1) to include some commercial mortgage-related securities and
residential mortgage-related securities. As defined in that rule, "commercial
mortgage-related security" and "residential mortgage-related security" mean, in
relevant part, a mortgage related security within the meaning of SMMEA, provided
that, in the case of a commercial mortgage-related security, it "represents
ownership of a promissory note or certificate of interest or participation that
is directly secured by a first lien on one or more parcels of real estate upon
which one or more commercial structures are located and that is fully secured by
interests in a pool of loans to numerous obligors." In the absence of any rule
or administrative interpretation by the OCC defining the term "numerous
obligors," we make no representation as to whether any class of offered
certificates will qualify as commercial mortgage-related securities, and thus as
Type IV securities, for investment by national banks.
The NCUA has adopted rules, codified at 12 C.F.R. Part 703, which permit
federal credit unions to invest in mortgage related securities under limited
circumstances, other than stripped mortgage related securities, residual
interests in mortgage related securities and commercial mortgage related
securities, unless the credit union has obtained written approval from the NCUA
to participate in the investment pilot program described in 12 C.F.R.
sec.703.140.
The OTS has issued Thrift Bulletin 13a (December 1, 1998), "Management of
Interest Rate Risk, Investment Securities, and Derivatives Activities," which
thrift institutions subject to the jurisdiction of the OTS should consider
before investing in any of the offered certificates.
All depository institutions considering an investment in the offered
certificates should review the "Supervisory Policy Statement on Investment
Securities and End-User
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Derivatives Activities" of the Federal Financial Institutions Examination
Council, which has been adopted by the Board of Governors of the Federal Reserve
System, the FDIC, the OCC and the OTS effective May 26, 1998, and by the NCUA
effective October 1, 1998. That statement sets forth general guidelines which
depository institutions must follow in managing risks, including market, credit,
liquidity, operational (transaction), and legal risks, applicable to all
securities, including mortgage pass-through securities and mortgage-derivative
products used for investment purposes.
There may be other restrictions, by way of statute, rule, regulation,
order, guideline, policy statement, agreement or otherwise, on your ability
either to purchase one or more classes of offered certificates of any series or
to purchase offered certificates representing more than a specified percentage
of your assets. Except as to the status of some classes as "mortgage related
securities," we make no representations as to the proper characterization of any
class of offered certificates for legal investment or other purposes. Also, we
make no representations as to the ability of particular investors to purchase
any class of offered certificates under applicable legal investment
restrictions. These uncertainties may adversely affect the liquidity of any
class of offered certificates. Accordingly, if your investment activities are
subject to legal investment laws and regulations, regulatory capital
requirements or review by regulatory authorities, you should consult with your
legal advisor in determining whether and to what extent--
- the offered certificates of any class and series constitute legal
investments or are subject to investment, capital or other restrictions;
and
- if applicable, SMMEA has been overridden in your State.
USE OF PROCEEDS
Unless otherwise specified in the related prospectus supplement, the net
proceeds to be received from the sale of the offered certificates of any series
will be applied by us to the purchase of assets for the related trust or will be
used by us to cover expenses related to that purchase and the issuance of those
certificates. We expect to sell the offered certificates from time to time, but
the timing and amount of offerings of those certificates will depend on a number
of factors, including the volume of mortgage assets acquired by us, prevailing
interest rates, availability of funds and general market conditions.
METHOD OF DISTRIBUTION
The certificates offered by this prospectus and the related prospectus
supplements will be offered in series through one or more of the methods
described in the next paragraph. The prospectus supplement prepared for the
offered certificates of each series will describe the method of offering being
utilized for those certificates and will state the net proceeds to us from the
sale of those certificates.
We intend that offered certificates will be offered through the following
methods from time to time. We further intend that offerings may be made
concurrently through
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more than one of these methods or that an offering of the offered certificates
of a particular series may be made through a combination of two or more of these
methods. The methods are as follows:
1. by negotiated firm commitment or best efforts underwriting and public
offering by one or more underwriters specified in the related prospectus
supplement;
2. by placements by us with institutional investors through dealers; and
3. by direct placements by us with institutional investors.
In addition, if specified in the related prospectus supplement, the offered
certificates of a series may be offered in whole or in part to the seller of the
mortgage assets that would back those certificates. Furthermore, the related
trust assets for any series of offered certificates may include other
securities, the offering of which was registered under the registration
statement of which this prospectus is a part.
If underwriters are used in a sale of any offered certificates, other than
in connection with an underwriting on a best efforts basis, the offered
certificates will be acquired by the underwriters for their own account. These
certificates may be resold from time to time in one or more transactions,
including negotiated transactions, at fixed public offering prices or at varying
prices to be determined at the time of sale or at the time of commitment
therefor. The managing underwriter or underwriters with respect to the offer and
sale of offered certificates of a particular series will be described on the
cover of the prospectus supplement relating to the series and the members of the
underwriting syndicate, if any, will be named in the relevant prospectus
supplement.
Underwriters may receive compensation from us or from purchasers of the
offered certificates in the form of discounts, concessions or commissions.
Underwriters and dealers participating in the payment of the offered
certificates may be deemed to be underwriters in connection with those
certificates. In addition, any discounts or commissions received by them from us
and any profit on the resale of those offered certificates by them may be deemed
to be underwriting discounts and commissions under the Securities Act of 1933,
as amended.
It is anticipated that the underwriting agreement pertaining to the sale of
the offered certificates of any series will provide that--
- the obligations of the underwriters will be subject to various conditions
precedent,
- the underwriters will be obligated to purchase all the certificates if
any are purchased, other than in connection with an underwriting on a
best efforts basis, and
- in limited circumstances, we will indemnify the several underwriters and
the underwriters will indemnify us against civil liabilities relating to
disclosure in our registration statement, this prospectus or any of the
related prospectus supplements, including liabilities under the
Securities Act of 1933, as amended, or will contribute to payments
required to be made with respect to any liabilities.
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The prospectus supplement with respect to any series offered by placements
through dealers will contain information regarding the nature of the offering
and any agreements to be entered into between us and purchasers of offered
certificates of that series.
We anticipate that the offered certificates will be sold primarily to
institutional investors. Purchasers of offered certificates, including dealers,
may, depending on the facts and circumstances of the purchases, be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended, in
connection with reoffers and sales by them of offered certificates. Holders of
offered certificates should consult with their legal advisors in this regard
prior to any reoffer or sale.
LEGAL MATTERS
Unless otherwise specified in the related prospectus supplement, particular
legal matters in connection with the certificates of each series, including some
federal income tax consequences, will be passed upon for us by--
- Sidley & Austin; or
- Thacher, Proffitt & Wood.
FINANCIAL INFORMATION
A new trust will be formed with respect to each series of offered
certificates. None of those trusts will engage in any business activities or
have any assets or obligations prior to the issuance of the related series of
offered certificates. Accordingly, no financial statements with respect to any
trust will be included in this prospectus or in the related prospectus
supplement. We have determined that our financial statements will not be
material to the offering of any offered certificates.
RATING
It is a condition to the issuance of any class of offered certificates
that, at the time of issuance, at least one nationally recognized statistical
rating organization has rated those certificates in one of its generic rating
categories which signifies investment grade. Typically, the four highest rating
categories, within which there may be sub-categories or gradations indicating
relative standing, signify investment grade.
Ratings on mortgage pass-through certificates address the likelihood of
receipt by the holders of all payments of interest and/or principal to which
they are entitled. These ratings address the structural, legal and
issuer-related aspects associated with the certificates, the nature of the
underlying mortgage assets and the credit quality of any third-party credit
enhancer. The rating(s) on a class of offered certificates will not represent
any assessment of--
- whether the price paid for those certificates is fair;
- whether those certificates are a suitable investment for any particular
investor;
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- the tax attributes of those certificates or of the related trust;
- the yield to maturity or, if they have principal balances, the average
life of those certificates;
- the likelihood or frequency of prepayments of principal on the underlying
mortgage loans;
- the degree to which the amount or frequency of prepayments on the
underlying mortgage loans might differ from those originally anticipated;
- whether or to what extent the interest payable on those certificates may
be reduced in connection with interest shortfalls resulting from the
timing of voluntary prepayments;
- the likelihood that any amounts other than interest at the related
mortgage interest rates and principal will be received with respect to
the underlying mortgage loans; or
- if those certificates provide solely or primarily for payments of
interest, whether the holders, despite receiving all payments of interest
to which they are entitled, would ultimately recover their initial
investments in those certificates.
A security rating is not a recommendation to buy, sell or hold securities
and may be subject to revision or withdrawal at any time by the assigning rating
organization. Each security rating should be evaluated independently of any
other security rating.
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GLOSSARY
The following capitalized terms will have the respective meanings assigned
to them in this "Glossary" section whenever they are used in this prospectus.
"ADA" means the Americans with Disabilities Act of 1990, as amended.
"CERCLA" means the federal Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended.
"Committee Report" means the Conference Committee Report accompanying the
Tax Reform Act of 1986.
"CPR" means an assumed constant rate of prepayment each month, which is
expressed on a per annum basis, relative to the then outstanding principal
balance of a pool of mortgage loans for the life of those loans.
"Disqualified Organization" means:
- the United States,
- any State or political subdivision of the United States,
- any foreign government,
- any international organization,
- any agency or instrumentality of the foregoing, except for
instrumentalities described in Section 168(h)(2)(D) of the Internal
Revenue Code of 1986 or Freddie Mac,
- any organization, other than a cooperative described in Section 521 of
the Internal Revenue Code of 1986, that is exempt from federal income
tax, except if it is subject to the tax imposed by Section 511 of the
Internal Revenue Code of 1986, or
- any organization described in Section 1381(a)(2)(C) of the Internal
Revenue Code of 1986.
"ECS" means Euroclear Clearance System, S.C., a Belgian cooperative
corporation.
"Electing Large Partnership" means any partnership having more than 100
members during the preceding tax year which elects to apply simplified reporting
provisions under the Internal Revenue Code of 1986, except for some service
partnerships and commodity pools.
"ERISA Plan" means any employee benefit plan, or other retirement plan,
arrangement or account, that is subject to the fiduciary responsibility
provisions of the Employee Retirement Income Security Act of 1974, as amended,
and Section 4975 of the Internal Revenue Code of 1986.
"Euroclear Operator" means Morgan Guaranty Trust Company of New York,
Brussels, Belgium office, as operator of the Euroclear System, or any successor
to Morgan Guaranty Trust Company of New York in that capacity.
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"Euroclear Terms and Conditions" means the Terms and Conditions Governing
Use of Euroclear and the related Operating Procedures of the Euroclear System
and, to the extent that it applies to the operation of the Euroclear System,
Belgian law.
"Fannie Mae" means the Federal National Mortgage Association.
"Farmer Mac" means the Federal Agricultural Mortgage Corporation.
"FASIT" means a financial asset securitization trust, within the meaning
of, and formed in accordance with, the Small Business Job Protection Act of 1996
and Sections 860I through 860L of the Internal Revenue Code of 1986.
"FDIC" means the Federal Deposit Insurance Corporation.
"Financial Intermediary" means a brokerage firm, bank, thrift institution
or other financial intermediary that maintains an account of a beneficial owner
of securities.
"Freddie Mac" means the Federal Home Loan Mortgage Association.
"Ginnie Mae" means the Government National Mortgage Association.
"Governing Document" means the pooling and servicing agreement or other
similar agreement or collection of agreements, which governs the issuance of a
series of offered certificates.
"IRS" means the Internal Revenue Service.
"Lender Liability Act" means the Asset Conservation Lender Liability and
Deposit Insurance Act of 1996, as amended.
"Net Income From Foreclosure Property" means income from foreclosure
property other than qualifying rents and other qualifying income for a REIT.
"NCUA" means the National Credit Union Administration.
"OCC" means the Office of the Comptroller of the Currency.
"OTS" means the Office of Thrift Supervision.
"Party in Interest" means any person that is a "party in interest" within
the meaning of ERISA or a "disqualified person" within the meaning of the
Internal Revenue Code of 1986.
"Pass-Through Entity" means any:
- regulated investment company,
- real estate investment trust,
- trust,
- partnership, or
- other entities described in Section 860E(e)(6) of the Internal Revenue
Code of 1986.
179
<PAGE> 431
"Plan Asset Regulations" means the regulations of the U.S. Department of
Labor promulgated under the Employee Retirement Income Security Act of 1974, as
amended.
"REIT" means a real estate investment trust within the meaning of Section
856(a) of the Internal Revenue Code of 1986.
"Relief Act" means the Soldiers' and Sailors' Relief Act of 1940, as
amended.
"REMIC" means a real estate mortgage investment conduit, within the meaning
of, and formed in accordance with, the Tax Reform Act of 1986 and Sections 860A
through 860G of the Internal Revenue Code of 1986.
"SEC" means the Securities and Exchange Commission.
"SPA" means standard prepayment assumption.
"UCC" means, for any jurisdiction, the Uniform Commercial Code as in effect
in that jurisdiction.
"U.S. Person" means:
- a citizen or resident of the United States;
- a corporation, partnership or other entity created or organized in, or
under the laws of, the United States, any state or the District of
Columbia;
- an estate whose income from sources without the United States is
includible in gross income for United States federal income tax purposes
regardless of its connection with the conduct of a trade or business
within the United States; or
- a trust as to which--
1. a court in the United States is able to exercise primary supervision
over the administration of the trust, and
2. one or more United States persons have the authority to control all
substantial decisions of the trust.
In addition, to the extent provided in the Treasury Regulations, a trust
will be a U.S. Person if it was in existence on August 20, 1996 and it elected
to be treated as a U.S. Person.
180
<PAGE> 432
The attached diskette contains one spreadsheet file that can be put on a
user-specified hard drive or network drive. This spreadsheet file is "SBMS
2000-C3 Annex A.xls". The spreadsheet file "SBMS 2000-C3 Annex A.xls" is a
Microsoft Excel(1), Version 5.0 spreadsheet. The file provides, in electronic
format, some of the statistical information that appears under the caption
"Description of the Mortgage Pool" in, and on Annex A to, this prospectus
supplement. Defined terms used, but not otherwise defined, in the spreadsheet
file will have the respective meanings assigned to them in this prospectus
supplement. All the information contained in the spreadsheet file is subject to
the same limitations and qualifications contained in this prospectus supplement.
Prospective investors are strongly urged to read this prospectus supplement and
accompanying prospectus in its entirety prior to accessing the spreadsheet file.
---------------
(1) Microsoft Excel is a registered trademark of Microsoft Corporation.
<PAGE> 433
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PROSPECTUS SUPPLEMENT
<TABLE>
<S> <C>
Important Notice About the Information
Contained in this Prospectus Supplement, The
Accompanying Prospectus and The Related
Registration Statement....................... S-4
Summary of Prospectus Supplement............... S-5
Risk Factors................................... S-30
Capitalized Terms Used in this Prospectus
Supplement................................... S-44
Forward-Looking Statements..................... S-44
Description of the Mortgage Pool............... S-45
Servicing of the Underlying Mortgage Loans..... S-80
Description of the Offered Certificates........ S-113
Yield and Maturity Considerations.............. S-139
Use of Proceeds................................ S-145
Federal Income Tax Consequences................ S-146
ERISA Considerations........................... S-150
Legal Investment............................... S-154
Method of Distribution......................... S-155
Legal Matters.................................. S-157
Ratings........................................ S-157
Glossary....................................... S-159
ANNEX A--Characteristics of the Underlying
Mortgage Loans and the Mortgaged Real
Properties................................... A-1
ANNEX B--Decrement Tables...................... B-1
ANNEX C--Form of Payment Date Statement........ C-1
ANNEX D--Global Clearance, Settlement and Tax
Documentation Procedures..................... D-1
PROSPECTUS
Important Notice About the Information
Presented in This Prospectus................. 3
Available Information; Incorporation by
Reference.................................... 3
Summary of Prospectus.......................... 4
Risk Factors................................... 15
Capitalized Terms Used in this Prospectus...... 38
Description of the Trust Assets................ 38
Yield and Maturity Considerations.............. 67
Salomon Brothers Mortgage Securities VII,
Inc.......................................... 74
Description of the Certificates................ 74
Description of the Governing Documents......... 86
Description of Credit Support.................. 96
Legal Aspects of Mortgage Loans................ 99
Federal Income Tax Consequences................ 114
State and Other Tax Consequences............... 167
ERISA Considerations........................... 167
Legal Investment............................... 172
Use of Proceeds................................ 174
Method of Distribution......................... 174
Legal Matters.................................. 176
Financial Information.......................... 176
Rating......................................... 176
Glossary....................................... 178
</TABLE>
UNTIL MARCH 18, 2001, ALL DEALERS THAT EFFECT TRANSACTIONS IN THE OFFERED
CERTIFICATES, WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO
DELIVER THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. THIS
DELIVERY REQUIREMENT IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
------------------------------------------------------------
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$825,481,000
(APPROXIMATE)
SALOMON BROTHERS COMMERCIAL
MORTGAGE TRUST 2000-C3
CLASS A-1, CLASS A-2, CLASS B, CLASS C,
CLASS D, CLASS E AND CLASS F
SERIES 2000-C3 COMMERCIAL MORTGAGE
PASS-THROUGH CERTIFICATES
------------------
PROSPECTUS SUPPLEMENT
------------------
SALOMON SMITH BARNEY
GREENWICH CAPITAL
ABN AMRO
CHASE SECURITIES INC.
DEUTSCHE BANC ALEX. BROWN
J.P. MORGAN & CO.
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