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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported): June 26, 1997
MERRILL LYNCH MORTGAGE INVESTORS, INC.
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(Exact name of registrant as specified in its governing instruments)
Delaware 333-1704 13-3416059
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
World Financial Center
North Tower
New York, New York 10281
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(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (212) 449-0336
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Item 1, Items 3 through 6, and Items 8 and 9 are not included because they are
not applicable.
Item 2. Acquisition or Disposition of Assets.
On June 26, 1997, a single series of mortgage pass-through certificates,
entitled Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1997-C1 (the "Certificates"), was issued pursuant to a
pooling and servicing agreement (the "Pooling Agreement") attached hereto as
Exhibit 4.1 and dated as of June 1, 1997, among Merrill Lynch Mortgage
Investors, Inc. as depositor (the "Registrant"), GE Capital Asset Management
Corporation as master servicer, GE Capital Realty Group, Inc. as special
servicer, General Electric Capital Corporation, ABN AMRO Bank N.V. as fiscal
agent and LaSalle National Bank as trustee. The Certificates consist of fifteen
classes (each, a "Class") of Certificates, eight of which Classes are designated
as the "Class A-1 Certificates", the "Class A-2 Certificates", the "Class A-3
Certificates", the "Class B Certificates", the "Class C Certificates", the
"Class D Certificates", the "Class E Certificates" and the "Class IO
Certificates" (collectively, the "Offered Certificates"); and seven of which
Classes are designated as the "Class F Certificates", the "Class G
Certificates", the "Class H Certificates", the "Class J Certificates", the
"Class R-I Certificates", the "Class R-II Certificates" and the "Class R-III
Certificates" (collectively, the "Private Certificates"). The Certificates
evidence in the aggregate the entire beneficial ownership interest in a trust
fund (the "Trust Fund") consisting primarily of 219 multifamily and commercial
mortgage loans (the "Mortgage Loans") having an aggregate principal balance as
of June 1, 1997 (the "Cut-off Date") of 840,787,856. Each Mortgage Loan is
secured by a first mortgage lien on a fee simple estate in an income producing
property with the exception of seven Mortgage Loans which are fully secured by a
leasehold estate in income-producing real property.
One hundred thirty-three (133) of the Mortgage Loans (the "MLMC Loans")
showing an aggregate principal balance of $498,496,030 (the "MLMC Balance"),
were acquired by the Registrant from Merrill Lynch Mortgage Capital Inc.
("MLMC"), fifty-one (51) of the Mortgage Loans (the "Daiwa Loans"), having an
aggregate principal balance of $181,313,093 (the "Daiwa Balance"), were acquired
by the Registrant from Daiwa Finance Corp. ("Daiwa Finance") and thirty-five
(35) of the Mortgage Loans (the "GECA Loans"), having an aggregate principal
balance of $160,978,732 (the "GECA Balance"), were acquired by the Registrant
from GE Capital Access, Inc. ("GECA," and together with Daiwa Finance and MLMC,
the "Sellers") pursuant to three Mortgage Loan Purchase Agreements, each dated
as of June 1, 1997 (the "Purchase Agreements"), between the Registrant and each
of the Sellers. The purchase prices (collectively the "Purchase Price") for (A)
the MLMC Loans paid by the Registrant to MLMC consisted of a cash amount equal
to (i) 100% of the MLMC Balance plus (ii) interest accrued on the MLMC Loans at
the related Mortgage Rate, (B) the GECA Loans paid by the Registrant to GECA
consisted of a cash amount equal to (i) 100% of the GECA Balance plus (ii)
interest accrued on the GECA Loans at the related Mortgage Rate and (C) the
Daiwa Loans paid by the Registrant to Daiwa Finance consisted of a cash amount
equal to (i) 101.97% of the Daiwa Balance plus (ii) interest accrued on each of
the Daiwa Loans at the related Mortgage Rate, for the period from and including
the Cut-off Date up to but not including the Closing Date. The source of funds
for payment of the Purchase Price was the proceeds derived from the sale of the
Certificates by the Registrant to Merrill Lynch, Pierce,
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Fenner & Smith Incorporated ("MLPF&S") and Daiwa Securities America Inc.
("Daiwa") pursuant to an Underwriting Agreement, dated as of June 20, 1997 (the
"Underwriting Agreement"), among the Registrant, MLPF&S and Daiwa (pertaining to
the Offered Certificates) and a Certificate Purchase Agreement, dated as of June
26, 1997, among the Registrant, MLPF&S and Daiwa (pertaining to the Private
Certificates). The Registrant is a wholly-owned limited purpose finance
subsidiary of MLMC. On June 26, 1997, the Registrant transferred the Mortgage
Loans to the Trust Fund pursuant to the Pooling Agreement. The consideration
received by the Registrant in exchange for such transfer consisted of the
Certificates.
The Certificates have the following initial Certificate Balances and initial
Pass-Through Rates:
Initial Pass-Through
Class Initial Certificate Balance Rate
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A-1......................... $251,675,000 6.95%
A-2......................... $86,719,000 7.03%
A-3......................... $254,361,000 7.12%
B .......................... $46,243,000 7.12%
C .......................... $46,244,000 7.12%
D .......................... $42,039,000 7.12%
E ......................... $16,816,000 7.12%
IO ........................ (1) (3)
F ......................... $50,447,000 7.12%
G ......................... $8,408,000 7.12%
H ......................... $16,816,000 7.12%
J ......................... $21,019,856 7.12%
R-I......................... N/A(2) N/A(2)
R-II........................ N/A(2) N/A(2)
R-III....................... N/A(2) N/A(2)
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(1) The Class IO Certificates will receive the sum of the interest accrued on
the notional amount of each of its Components and will not have a
Certificate Balance nor will they entitle the holders thereof to receive
distributions of principal.
(2) The Class R-1, Class R-II and Class R-III Certificates have no Certificate
Balance and do not bear interest.
(3) Holders of the Class IO Certificates will be entitled to receive
distributions of interest in an amount equal to the aggregate interest
accrued on the notional amount of each of its Components.
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The Offered Certificates and the Mortgage Loans are more particularly
described in the Prospectus, dated June 5, 1997, and the Prospectus Supplement,
dated June 20, 1997, as previously filed with the Securities and Exchange
Commission pursuant to Rule 424(b)(5). Capitalized terms used but not otherwise
defined herein have the meanings set forth in the Prospectus Supplement.
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Item 7. Financial Statements and Exhibits
(a) Financial Statements - Not Applicable
(b) Pro Forma Financial Information - Not Applicable
(c) Exhibits
1.1 Underwriting Agreement, dated as of June 20, 1997, among
Merrill Lynch Mortgage Investors, Inc., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Daiwa Securities
America Inc.
4.1 Pooling and Servicing Agreement, dated as of June 1,
1997, among Merrill Lynch Mortgage Investors, Inc. as
depositor, GE Capital Asset Management Corporation as
master servicer, GE Capital Realty Group, Inc. as
special servicer, General Electric Capital Corporation,
ABN AMRO Bank N.V. as fiscal agent and LaSalle National
Bank as trustee.
99.1 Mortgage Loan Purchase Agreement, dated as of June 1,
1997, between Merrill Lynch Mortgage Investors, Inc. and
Merrill Lynch Mortgage Capital Inc.
99.2 Mortgage Loan Purchase Agreement, dated as of June 1,
1997, between Merrill Lynch Mortgage Investors, Inc. and
Daiwa Finance Corp.
99.3 Mortgage Loan Purchase Agreement, dated as of June 1,
1997, between Merrill Lynch Mortgage Investors, Inc. and
GE Capital Access, Inc.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MERRILL LYNCH MORTGAGE INVESTORS, INC.
By: /s/ Michael M. McGovern
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Name: Michael M. McGovern
Title: Secretary and Director
Dated: July 10, 1997
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EXHIBIT INDEX
The following exhibits are being filed herewith:
Exhibit No. Description
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1.1 Underwriting Agreement, dated as of November 20, 1997, among
Merrill Lynch Mortgage Investors, Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Daiwa Securities America
Inc...............................................................
4.1 Pooling and Servicing Agreement, dated as of June 1, 1997, among
Merrill Lynch Mortgage Investors, Inc. as depositor, GE Capital
Asset Management Corporation as master servicer, GE Capital Realty
Group, Inc. as special servicer, General Electric Capital
Corporation, ABN AMRO Bank N.V. as fiscal agent and LaSalle
National Bank as trustee..........................................
99.1 Mortgage Loan Purchase Agreement, dated as of June 1, 1997,
between Merrill Lynch Mortgage Investors, Inc. and Merrill Lynch
Mortgage Capital Inc..............................................
99.2 Mortgage Loan Purchase Agreement, dated as of June 1, 1997,
between Merrill Lynch Mortgage Investors, Inc. and Daiwa Finance
Corp..............................................................
99.3 Mortgage Loan Purchase Agreement, dated as of June 1, 1997,
between Merrill Lynch Mortgage Investors, Inc. and GE Capital
Access, Inc.......................................................
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MERRILL LYNCH MORTGAGE INVESTORS, INC.
UNDERWRITING AGREEMENT
As of June 20, 1997
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center, North Tower
New York, New York 10281
Daiwa Securities America Inc.
Financial Square, 32 Old Slip
New York, New York 10005-3538
Ladies and Gentlemen:
Merrill Lynch Mortgage Investors, Inc., a Delaware corporation (the
"Company"), proposes to sell to Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("Merrill Lynch") and Daiwa Securities America Inc. ("Daiwa";
Merrill Lynch and Daiwa, each, an "Underwriter" and, together, the
"Underwriters") the mortgage pass-through certificates identified in Schedule I
hereto (the "Certificates"), pursuant to this Underwriting Agreement (this
"Agreement").
The Certificates will evidence beneficial ownership interests in a trust
fund (the "Trust Fund") to be formed by the Company and consisting primarily of
a segregated pool (the "Mortgage Pool") of multifamily and commercial mortgage
loans (the "Mortgage Loans") to be purchased from Merrill Lynch Mortgage Capital
Inc., Daiwa Finance Corp. and GE Capital Access, Inc. (collectively, the
"Mortgage Loan Sellers"). The Certificates will be issued pursuant to a Pooling
and Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of
June 1, 1997 (the "Cut-off Date"), among the Company as depositor, LaSalle
National Bank as trustee (the "Trustee"), ABN AMRO Bank N.V. as fiscal agent
(the "Fiscal Agent"), GE Capital Asset Management Corporation as master servicer
(the "Master Servicer") and GE Capital Realty Group, Inc. as special servicer
(the "Special Servicer"). The Certificates and the Mortgage Loans are described
more fully in the Prospectus (as hereinafter defined) which the Company has
furnished to the Underwriters.
The Company has filed with the Securities and Exchange Commission (the
"Commission") registration statement (No. 333-1704, the "Registration
Statement") on Form S-3 for the registration of the Certificates under the
Securities Act of 1933, as amended (the "1933 Act"), which registration
statement has become effective and copies of which have heretofore been
delivered to the Underwriters. The Company proposes to file with the Commission
pursuant to Rule 424(b) under the 1933 Act a supplement to the form of
prospectus included in such registration statement relating to the Certificates
and the plan of distribution thereof. Such
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registration statement, including the exhibits thereto, as amended at the date
hereof, is hereinafter called the "Registration Statement"; the prospectus
included in the Registration Statement, at the time the Registration Statement,
as amended, became effective, or as subsequently filed with the Commission
pursuant to Rule 424(b) under the 1933 Act, is hereinafter called the "Basic
Prospectus"; such supplement, dated June 20, 1997 to the form of prospectus
relating to the Certificates, in the form in which it shall be filed with the
Commission pursuant to Rule 424 is hereinafter called the 'Prospectus
Supplement"; and the Basic Prospectus and the Prospectus Supplement, together,
hereinafter called the "Prospectus". Any preliminary form of the Prospectus that
has heretofore been filed pursuant to Rule 424(b) is hereinafter called a
"Preliminary Prospectus".
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to each Underwriter as follows:
(i) The Registration Statement has become effective, and the
Registration Statement as of the effective date thereof (the "Effective
Date"), and the Prospectus as of the date of the Prospectus Supplement,
complied in all material respects with the applicable requirements of the
1933 Act and the rules and regulations thereunder; and the information in
the Registration Statement concerning the Company, as of the Effective
Date, did not contain any untrue statement of a material fact and did not
omit to state any material fact required to be stated therein or necessary
to make the statements therein not misleading. The information in the
Prospectus concerning the Company, as of the date of the Prospectus
Supplement, did not, and as of the Closing Date (as hereinafter defined)
will not, contain an untrue statement of a material fact and did not and
will not omit to state a material fact necessary in order to make the
information therein concerning the Company, in the light of the
circumstances under which they were made, not misleading. The parties agree
that the only information concerning the Company in the Registration
Statement is on page 30 of the Basic Prospectus under the caption "The
Depositor" and on page S-6 of the Prospectus Supplement under the caption
"Summary of Prospectus Supplement-Depositor. "
(ii) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware with
corporate power and authority to own its properties and to conduct its
business as now conducted by it and to enter into and perform its
obligations under this Agreement and the Pooling and Servicing Agreement.
(iii) The Company is not in violation of its charter and by-laws or in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Company is a party or by which it maybe bound, or to which any of the
property of the Company is subject. The execution, delivery and performance
of this Agreement and the Pooling and Servicing Agreement and the
consummation of the transactions contemplated herein and therein and
compliance by the
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Company with its obligations hereunder and thereunder have been duly
authorized by all the necessary corporate action and will not conflict with
or constitute a breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property of the
Company pursuant to any contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which the Company is a party or by which
it may be bound, or to which any of the property or assets of the Company
is subject.
(iv) The Certificates have been duly authorized for issuance and sale
pursuant to this Agreement and the Pooling and Servicing Agreement (or will
have been so authorized prior to the issuance of the Certificates) and,
when issued, authenticated and delivered pursuant to the provisions of this
Agreement and of the Pooling and Servicing Agreement against payment of the
consideration therefor in accordance with this Agreement, the Certificates
will be duly and validly issued and outstanding and entitled to the
benefits provided by the Pooling and Servicing Agreement, except as
enforcement thereof may be limited by bankruptcy, insolvency or other laws
relating to or affecting enforcement of creditors' rights or by general
equity principles.
(v) No authorization, approval or consent of any court or governmental
authority or agency is necessary in connection with the offering, issuance
or sale of the Certificates hereunder, except such as have been, or as of
the Closing Date will have been, obtained or such as may otherwise be
required under applicable state securities laws in connection with the
purchase and offer and sale of the Certificates by the Underwriters and any
recordation of the respective assignments of the Mortgage Loans to the
Trustee pursuant to the Pooling and Servicing Agreement that have not yet
been completed.
(vi) This Agreement has been, and as of the Closing Date the Pooling
and Servicing Agreement will be, duly authorized, executed and delivered by
the Company. This Agreement constitutes, and as of the Closing Date the
Pooling and Servicing Agreement will constitute, a legal, valid and binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except as enforceability may be limited by (A) bankruptcy,
insolvency, reorganization, receivership, moratorium or other similar laws
affecting the enforcement of the rights of creditors generally, (B) general
principles of equity, whether enforcement is sought in a proceeding in
equity or at law, and (C) public policy considerations underlying the
securities laws, to the extent that such public policy considerations limit
the enforceability of the provisions of this Agreement that purport to
provide indemnification from securities law liabilities.
(vii) At the time of the execution and delivery of the Pooling and
Servicing Agreement, the Company (A) will convey to the Trustee, or cause
to be conveyed to the Trustee, all of its right, title and interest in and
to the Mortgage Loans that are transferred by it to the Trustee, free and
clear of any lien, mortgage, pledge, charge, encumbrance, adverse claim or
other security interest (collectively, "Liens") granted by or imposed upon
the Company, (B) will not have assigned to any person any of its right,
title or interest in such Mortgage Loans or in the Pooling and Servicing
Agreement or the Certificates, and (C) will have the power and authority to
transfer such Mortgage
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Loans to the Trustee and to sell the Certificates to the Underwriters, and
upon delivery to the Underwriters of the Certificates, each Underwriter
will have good title to the Certificates purchased by such Underwriter, in
each case free of Liens.
(viii) Neither the Company nor the Trust Fund is required to be
registered as an "investment company" under the Investment Company Act of
1940, as amended (the "1940 Act").
(ix) Under generally accepted accounting principles ("GAAP") and for
federal income tax purposes, the Company will report the transfer of the
Mortgage Loans to the Trustee in exchange for the Certificates and the sale
of the Certificates to the Underwriters pursuant to this Agreement as a
sale of the interests in the Mortgage Loans evidenced by the Certificates.
The consideration received by the Company upon the sale of the Certificates
to the Underwriters will constitute reasonably equivalent value and fair
consideration for the Certificates. The Company will be solvent at all
relevant times prior to, and will not be rendered insolvent by, the sale of
the Certificates to the Underwriters. The Company is not selling the
Certificates to the Underwriters with any intent to hinder, delay or
defraud any of the creditors of the Company.
(x) At the Closing Date, the respective classes of Certificates shall
have been assigned ratings no lower than those set forth in Schedule I
hereto by the nationally recognized statistical rating organizations
identified in Schedule I hereto (the "Rating Agencies").
(xi) Any taxes, fees and other governmental charges in connection with
the execution, delivery and issuance of this Agreement, the Pooling and
Servicing Agreement and the Certificates payable by the Company (other than
income taxes) have been paid or will be paid at or prior to the Closing
Date.
(xii) There are no actions, proceedings or investigations pending
before or threatened by any court, administrative agency or other tribunal
to which the Company is a party or of which any of its properties is the
subject (a) which if determined adversely to the Company would have a
material adverse effect on the business or financial condition of the
Company, (b) asserting the invalidity of this Agreement, the Pooling and
Servicing Agreement or the Certificates, (c) seeking to prevent the
issuance of the Certificates or the consummation by the Company of any of
the transactions contemplated by the Pooling and Servicing Agreement or
this Agreement, as the case may be, or (d) which might materially and
adversely affect the performance by the Company of its obligations under,
or the validity or enforceability of, the Pooling and Servicing Agreement,
this Agreement or the Certificates.
(xiii) The Company possesses all material licenses, certificates,
authorities or permits issued by appropriate state, federal, or foreign
regulatory agencies and bodies necessary to conduct the business now
conducted by it and as described in the Prospectus, and the Company has not
received notice of any proceedings relating to the revocation or
modification of any such license, certificate, authority or permit which if
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decided adversely to the Company would singly, or in the aggregate,
materially and adversely affect the conduct of its business, operations or
financial condition.
At the Closing Date, each of the representations and warranties of the
Company set forth in the Pooling and Servicing Agreement will be true and
correct in all material respects.
(b) Each Underwriter represents and warrants to the Company that (i) such
Underwriter, as of the date hereof, complied, and as of the Closing Date, will
comply with all of its obligations hereunder and (ii) with respect to all
Computational Materials and ABS Term Sheets, if any, provided by such
Underwriter to the Company pursuant to Section 4(b)(iv), such Computational
Materials and ABS Term Sheets, as of the date hereof, are, and as of the Closing
Date, will be accurate in all material respects (taking into account the
assumptions explicitly set forth in the Computational Materials or ABS Term
Sheets) and constitutes, as of the date hereof, and as of the Closing Date, will
constitute the complete set of all Computational Materials and ABS Term Sheets
that are required to be filed with the Commission pursuant to Section 5(i).
SECTION 2. Purchase and Sale.
Subject to the terms and conditions herein set forth and in reliance upon
the representations and warranties herein contained, the Company agrees to sell
to the Underwriters, and each Underwriter agrees to purchase from the Company,
at the related purchase price set forth on Schedule I hereto, Certificates of
each class thereof having an actual amount as set forth on Schedule I hereto.
There will be added to the purchase price of the Certificates an amount equal to
interest accrued thereon pursuant to the terms thereof from the Cut-off Date to
but excluding the Closing Date.
SECTION 3. Delivery and Payment.
Payment of the aggregate purchase price for, and delivery of, the
Certificates shall be made at 10:00 A.M. New York City time on June 26, 1997,
which date and time may be postponed by agreement among the Underwriters and the
Company (such time and date of payment and delivery, the "Closing Date").
Payment shall be made to the Company in immediately available funds wired to
such bank as may be designated by the Company, against delivery of the
Certificates. The Certificates shall be in such authorized denominations and
registered in such names as either Underwriter may request in writing at least
two business days before the Closing Date. The Certificates will be made
available for examination by the Underwriters not later than 10:00 A.M. New York
City time on the last business day prior to the Closing Date. Except as
otherwise set forth in Schedule I, delivery of the Certificates shall be made at
the office of Willkie Farr & Gallagher, One Citicorp Center, 153 East 53rd
Street, New York, New York 10022, or at such other place as shall be agreed upon
by the Underwriters and the Company.
SECTION 4. Offering by Underwriters.
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(a) It is understood that the Underwriters propose to offer the
Certificates for sale as set forth in the Prospectus. It is further understood
that the Company, in reliance upon an exemption from the Attorney General of the
State of New York granted pursuant to Policy Statement 105, has not and will not
file an offering statement pursuant to Section 352-c of the General Business Law
of the State of New York with respect to the Certificates. Each Underwriter
therefore agrees that sales of the Certificates made by such Underwriter in and
from the State of New York will be made only to institutional investors within
the meaning of Policy Statement 105.
(b) Each Underwriter may prepare and provide to prospective investors
certain Computational Materials, Structural Term Sheets and Collateral Term
Sheets in connection with its offering of the Certificates, subject to the
following conditions:
(i) Such Underwriter shall have complied with the requirements of the
no- action letter, dated May 20, 1994, issued by the Commission to Kidder,
Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated and
Kidder Structured Asset Corporation, as made applicable to other issuers
and underwriters by the Commission in response to the request of the Public
Securities Association, dated May 24, 1994 (collectively, the "Kidder/PSA
Letter"), and the requirements of the no-action letter, dated February 17,
1995, issued by the Commission to the Public Securities Association (the
"PSA Letter" and, together with the Kidder/PSA Letter, the "No-Action
Letters ").
(ii) For purposes hereof, "Computational Materials" shall have the
meaning given such term in the No-Action Letters, but shall include only
those Computational Materials that have been prepared or delivered to
prospective investors by or at the direction of such Underwriter. For
purposes hereof, "ABS Term Sheets", "Structural Term Sheets" and
"Collateral Term Sheets" shall have the meanings given such terms in the
PSA Letter but shall include only those ABS Term Sheets, Structural Term
Sheets or Collateral Term Sheets that have been prepared or delivered to
prospective investors by or at the direction of such Underwriter.
(iii) All Computational Materials and ABS Term Sheets provided to
prospective investors that are required to be filed pursuant to the
No-Action Letters shall bear a legend substantially in the form attached
hereto as Exhibit A-1 and, in the case of Collateral Term Sheets, such
legend shall also include the statement substantially in the form set forth
on Exhibit A-2. The Company shall have the right to require specific
legends or notations to appear on any Computational Materials or ABS Term
Sheets, the right to require changes regarding the use of terminology and
the right to determine the types of information appearing therein.
Notwithstanding the foregoing, this subsection (iii) will be satisfied if
all Computational Materials and ABS Term Sheets referred to herein bear a
legend in a form previously approved in writing by the Company.
(iv) Such Underwriter shall have provided the Company with
representative forms of all Computational Materials and ABS Term Sheets
prior to their first use, to the extent such forms have not previously been
approved by the Company for use by the
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Underwriter. Such Underwriter shall have provided to the Company, for
filing on Form 8-K as provided in Section 5(i), copies (in such format as
required by the Company) of all Computational Materials and ABS Term Sheets
that are required to be filed with the Commission pursuant to the No-Action
Letters. The Underwriter may have provided copies of the foregoing in a
consolidated or aggregated form including all information required to be
filed. All Computational Materials and ABS Term Sheets described in this
subsection (iv) shall have been provided to the Company not later than
10:00 a.m. (New York City time) not less than one business day before
filing thereof is required pursuant to the terms of this Agreement. Such
Underwriter shall have not provided to any investor or prospective investor
in the Certificates any Computational Materials or ABS Term Sheets on or
after the day on which Computational Materials and ABS Term Sheets are
required to be provided to the Company pursuant to this subsection (iv)
(other than copies of Computational Materials or ABS Term Sheets previously
submitted to the Company in accordance with this subsection (iv) for filing
pursuant to Section 5(i)), unless such Computational Materials or ABS Term
Sheets are preceded or accompanied by the delivery of a Prospectus to such
investor or prospective investor.
(v) All information included in the Computational Materials and ABS
Term Sheets shall have been generated based on substantially the same
methodology and assumptions that are used to generate the information in
the Prospectus Supplement as set forth therein; provided that the
Computational Materials and ABS Term Sheets may have included information
based on alternative methodologies or assumptions if specified therein. If
any Computational Materials or ABS Term Sheets that are required to be
filed were based on assumptions with respect to the Mortgage Pool that
differ from the final Pool Information in any material respect or on
Certificate structuring assumptions that were revised in any material
respect prior to the printing of the Prospectus, such Underwriter shall
have prepared revised Computational Materials or ABS Term Sheets, as the
case may be, based on the final Pool Information and structuring
assumptions, shall have circulated such revised Computational Materials and
ABS Term Sheets to all recipients of the preliminary versions thereof that
indicated orally to the Underwriter they would purchase all or any portion
of the Certificates, and shall have included such revised Computational
Materials and ABS Term Sheets (marked, "as revised") in the materials
delivered to the Company pursuant to subsection (iv) above.
(vi) The Company shall not be obligated to file any Computational
Materials or ABS Term Sheets that have been determined to contain any
material error or omission, provided that, at the request of such
Underwriter, the Company will file Computational Materials or ABS Term
Sheets that contain a material error or omission if clearly marked
"superseded by materials dated ____________" and accompanied by corrected
Computational Materials or ABS Term Sheets that are marked, "material
previously dated __________, as corrected." If, within the period during
which the Prospectus relating to the Certificates is required to be
delivered under the 1933 Act, any Computational Materials or ABS Term
Sheets are determined, in the reasonable judgment of the Company or such
Underwriter, to contain a material error or omission, the Underwriter shall
prepare a corrected version of such Computational Materials or ABS Term
Sheets, shall circulate such corrected Computational Materials or ABS Term
Sheets
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to all recipients of the prior versions thereof that either indicated
orally to the Underwriter they would purchase all or any portion of the
Certificates, or actually purchased all or any portion thereof, and shall
deliver copies of such corrected Computational Materials or ABS Term Sheets
(marked, "as corrected") to the Company for filing with the Commission in a
subsequent Form 8-K submission (subject to the Company's obtaining an
accountant's comfort letter in respect of such corrected Computational
Materials and ABS Term Sheets, which shall be at the expense of such
Underwriter).
(vii) Such Underwriter shall be deemed to have represented, as of the
Closing Date, that, except for Computational Materials and/or ABS Term
Sheets provided to the Company pursuant to subsection (iv) above, such
Underwriter did not provide any prospective investors with any information
in written or electronic form in connection with the offering of the
Certificates that is required to be filed with the Commission in accordance
with the No-Action Letters, and such Underwriter shall provide the Company
with a certification to that effect on the Closing Date.
(viii) In the event of any delay in the delivery by such Underwriter
to the Company of all Computational Materials and ABS Term Sheets required
to be delivered in accordance with subsection (iv) above, or in the
delivery of the accountant's comfort letter in respect thereof pursuant to
Section 5(i), the Company shall have the right to delay the release of the
Prospectus to investors or to the Underwriter, to delay the Closing Date
and to take other appropriate actions in each case as necessary in order to
allow the Company to comply with its agreement set forth in Section 5(i) to
file the Computational Materials and ABS Term Sheets by the time specified
therein.
(ix) Such Underwriter represents that it has in place, and covenants
that it shall maintain, internal controls and procedures which it
reasonably believes to be sufficient to ensure full compliance with all
applicable legal requirements of the No-Action Letters with respect to the
generation and use of Computational Materials and ABS Term Sheets in
connection with the offering of the Certificates.
(c) Each Underwriter further agrees that it shall promptly provide the
Company with such information as to matters of fact as the Company may
reasonably request to enable it to comply with its reporting requirements with
respect to each class of Certificates to the extent such information can in the
good faith judgment of the Underwriter be determined by it.
SECTION 5. Covenants of the Company.
The Company covenants with each Underwriter as follows:
(a) The Company will give each Underwriter notice of its intention to file
or prepare any amendment to the Registration Statement at any time prior to the
Closing Date or any amendment or supplement to the Prospectus at any time
hereafter, and will furnish the
8
<PAGE>
Underwriters with copies of any such amendment or supplement a reasonable amount
of time prior to such proposed filing or use, as the case may be.
(b) The Company will cause the Prospectus to be transmitted to the
Commission for filing pursuant to Rule 424(b) under the 1933 Act by means
reasonably calculated to result in filing with the Commission pursuant to said
rule.
(c) The Company will deliver to such Underwriter a copy of the Registration
Statement as originally filed and of each amendment thereto (including exhibits
filed therewith or incorporated by reference therein).
(d) The Company will furnish to each Underwriter, from time to time during
the period when the Prospectus is required to be delivered under the 1933 Act or
the Securities Exchange Act of 1934, as amended (the "1934 Act"), such number of
copies of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request for the purposes contemplated by the 1933 Act or the 1934 Act
or the respective applicable rules and regulations of the Commission thereunder.
(e) If, during the period after the first date of the public offering of
the Certificates in which a prospectus relating to the Certificates is required
to be delivered under the 1933 Act, any event shall occur as a result of which
it is necessary to amend or supplement the Prospectus in order to make the
Prospectus not misleading in the light of the circumstances existing at the time
it is delivered to a purchaser, the Company will forthwith amend or supplement
the Prospectus so that, as so amended or supplemented, the Prospectus will not
include an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances existing, at the time it is delivered to a purchaser, not
misleading, and the Company will furnish to such Underwriter a reasonable number
of copies of such amendment or supplement.
(f) The Company will endeavor to arrange for the qualification of the
Certificates for sale under the applicable securities laws of such states and
other jurisdictions of the United States as such Underwriter may reasonably
designate and will maintain such qualification in effect so long as required for
the initial distribution of Certificates; provided, however, that the Company
shall not be obligated to qualify as a foreign corporation in any jurisdiction
in which it is not so qualified.
(g) The Company will pay or cause to be paid all fees and expenses of its
counsel. The Underwriters shall be responsible for the payment of all other
costs and expenses incurred in connection with the transactions.
(h) If, during the period after the Closing Date in which a prospectus
relating to the Certificates is required to be delivered under the 1933 Act, the
Company receives notice that a stop order suspending the effectiveness of the
Registration Statement or preventing the offer and sale of the Certificates is
in effect, the Company will immediately advise such Underwriter of the issuance
of such stop order.
9
<PAGE>
(i) The Company will file with the Commission within fifteen days of the
issuance of the Certificates a report on Form 8-K setting forth specific
information concerning the Certificates and the Mortgage Pool to the extent that
such information is not set forth in the Prospectus. The Company will also file
with the Commission a report on Form 8-K setting forth all Computational
Materials and ABS Term Sheets provided to the Company by either Underwriter and
identified by it as such within the time period allotted for such filing
pursuant to the No-Action Letters; provided, however, that prior to such filing
of the Computational Materials and ABS Term Sheets (other than any ABS Term
Sheets that are not based on the Pool Information) by the Company (A) each
Underwriter must comply with its obligations pursuant to Section 4 and (B) if
the Company determines that the methodology on which all or any part of such
Computational Materials and ABS Term Sheets were prepared is not substantially
the same as (x) the methodology on which information in the Prospectus
Supplement (or Preliminary Prospectus Supplement) was prepared or (y) a
methodology acceptable to the Company and as to the accuracy of which the
Company was otherwise given comfort satisfactory to the Company, the Company
must receive a letter from Deloitte & Touche LLP ("Deloitte"), certified public
accountants, satisfactory in form and substance to the Company, to the effect
that such accountants have performed certain specified procedures, all of which
have been agreed to by the Company, as a result of which they have determined
that the information included in the Computational Materials and ABS Term Sheets
(if any) as to which the Company has made such a determination and which they
have examined in accordance with such specified procedures is accurate except as
to such matters that are not deemed by the Company to be material. The foregoing
letter shall be at the expense of the Underwriter that provided the
Computational Materials to the Company. The Company shall file any corrected
Computational Materials described in Section 4(b)(vi) as soon as practicable
following receipt thereof.
SECTION 6. Conditions of Underwriters' Obligations.
Each Underwriter's obligation to purchase the Certificates allocated to
it as set forth on Schedule I hereto shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the date hereof and as of the Closing Date, to the performance by the Company of
its obligations hereunder and to the following conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall be in effect, and no proceedings for that purpose shall be
pending or, to the Company's knowledge, threatened by the Commission.
(b) On the Closing Date, each Underwriter shall have received:
(i) One or more opinions, dated the Closing Date, of counsel to
the Company, in form and substance satisfactory to such Underwriter,
substantially to the effect that:
A. The Company is a corporation in good standing under the
laws of the State of Delaware and has the corporate power and
authority to enter into and perform its obligations under each of
the Pooling and Servicing Agreement and this Agreement.
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<PAGE>
B. Each of the Pooling and Servicing Agreement and this
Agreement has been duly authorized, executed and delivered by the
Company.
C. Each of the Pooling and Servicing Agreement and this
Agreement, upon due authorization, execution and delivery by the
other parties thereto, will constitute a valid, legal and binding
agreement of the Company, enforceable against the Company in
accordance with its terms, except as enforceability may be
limited by (a) bankruptcy, insolvency, liquidation, receivership,
moratorium, reorganization or other similar laws affecting the
enforcement of the rights of creditors generally, (b) general
principles of equity, whether enforcement is sought in a
proceeding in equity or at law and (c) public policy
considerations underlying the securities laws, to the extent that
such public policy considerations limit the enforceability of
provisions which purport to provide indemnification from
securities law liabilities.
D. The Certificates, when duly and validly executed,
authenticated and delivered in accordance with the Pooling and
Servicing Agreement and paid for in accordance with this
Agreement and the Certificate Purchase Agreement, will be
entitled to the benefits of the Pooling and Servicing Agreement.
E. The Registration Statement is effective under the 1933
Act and, to such counsel's knowledge, no stop order suspending
the effectiveness of the Registration Statement has been issued
under the 1933 Act and no proceedings for that purpose have been
instituted or threatened under Section 8(d) of the 1933 Act.
F. At the time it became effective, the Registration
Statement (other than any financial statements and supporting
schedules included therein, as to which such counsel renders no
opinion) complied as to form in all material respects with the
requirements of the 1933 Act and the applicable rules and
regulations thereunder.
G. To such counsel's knowledge, there are no material
contracts, indentures or other documents of the Company required
to be described or referred to in the Registration Statement or
to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as
exhibits thereto.
H. The offer and sale of the Privately Offered Certificates
by the Company to the Purchasers (as defined in the Certificate
Purchase Agreement) in the manner contemplated by the Certificate
Purchase Agreement do not require registration of the Privately
Offered Certificates under the 1933 Act.
I. The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended.
Neither the Company nor the Trust Fund is required to be
registered under the Investment Company Act of 1940, as amended.
J. No consent, approval, authorization or order of any State
of New York or federal court or governmental agency or body is
required for the consummation by the Company of the transactions
contemplated by the Pooling and Servicing Agreement
11
<PAGE>
and this Agreement, except (i) such as have been obtained under
the 1933 Act, (ii) such as may be required under the securities
laws of any jurisdiction in connection with the purchase and the
offer and sale of the Certificates by the Underwriters, as to
which such counsel express no opinion and (iii) any recordation
of the assignments of the Mortgage Loans pursuant to the Pooling
and Servicing Agreement that has not yet been completed.
K. Neither the offer and sale of the Certificates nor the
consummation of any other of the transactions contemplated in or
the fulfillment of the terms of the Pooling and Servicing
Agreement and this Agreement, will conflict with or result in a
breach or violation of any term or provision of, or constitute a
default (or an event which with the passing of time or
notification, or both, would constitute a default) under, the
certificate of incorporation or by-laws of the Company or, to the
knowledge of such counsel, any indenture or other agreement or
instrument to which the Company is a party or by which it is
bound, or any State of New York or federal statute or regulation
applicable to the Company or, to the knowledge of such counsel,
any order of any State of New York or federal court, regulatory
body, administrative agency or governmental body having
jurisdiction over the Company.
L. There are no actions, proceedings or investigations
pending, before or, to such counsel's knowledge, threatened by
any court, administrative agency or other tribunal to which the
Company is a party or of which any of its properties is the
subject (a) which, if determined adversely to the Company, would
have a material adverse effect on the business or financial
condition of the Company, (b) asserting the invalidity of the
Pooling and Servicing Agreement, this Agreement or the
Certificates, (c) seeking to prevent the issuance of the
Certificates or the consummation by the Company of any of the
transactions contemplated by the Pooling and Servicing Agreement
and this Agreement or (d) which might materially and adversely
affect the performance by the Company of its obligations under,
or the validity or enforceability of the Pooling and Servicing
Agreement and this Agreement.
(ii) An opinion, dated the Closing Date, of counsel to the
Underwriters, acceptable to such Underwriter.
In giving their opinions required by subsection (b)(i) of this
Section, counsel to the Company shall additionally state (A) that
nothing has come to such counsel's attention that would lead it to
believe that the Prospectus (other than the financial statements and
supporting schedules and statistical information included therein, as
to which no opinion need be rendered), at the date of the Basic
Prospectus, at the date of the Prospectus Supplement or at the Closing
Date, included or includes an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading and (B) that nothing has come to such
counsel's attention that would lead it to believe the Registration
Statement (other than any financial statements and supporting
schedules and statistical information included therein, as to which no
opinion need be rendered), at the Effective Date, contained an untrue
statement of a material fact or omitted to state a
12
<PAGE>
material fact required to be stated therein or necessary to make the
statements therein not misleading.
(c) On the Closing Date, such Underwriter shall have received a favorable
opinion, dated the Closing Date, of tax and ERISA counsel to the Company with
respect to the Certificates (i) regarding the qualification of each of REMIC I,
REMIC II and REMIC III (as each such term is defined in the Pooling and
Servicing Agreement) as a real estate mortgage investment conduit within the
meaning of Sections 860A through 86OG of the Internal Revenue Code of 1986, as
amended, and (ii) to the effect that the statements in the Basic Prospectus and
the Prospectus Supplement under the headings "Certain Federal Income Tax
Consequences" and "ERISA Considerations", to the extent that they constitute
matters of State of New York or federal law or legal conclusions with respect
thereto, while not purporting to discuss all possible consequences of investment
in the Certificates, are correct in all material respects with respect to those
consequences or matters that are discussed therein.
(d) The Company shall have delivered to such Underwriter a certificate,
dated the Closing Date, of the President, a Senior Vice President or a Vice
President of the Company to the effect that the signer of such certificate has
examined, or has relied upon an examination conducted by appropriate persons
authorized by him, of this Agreement, the Prospectus, the Pooling and Servicing
Agreement and various other closing documents, and that, to the best of his or
her knowledge after reasonable investigation:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects;
(ii) the Company has, in all material respects, complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date; and
(iii) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
initiated or threatened by the Commission.
(e) The Company and the Underwriters shall have received from Deloitte,
certified public accountants, a letter dated the Closing Date, in form and
substance satisfactory to such Underwriter, stating in effect that:
(i) they have performed certain specified procedures as a result of
which they have determined that the information of an accounting, financial
or statistical nature set forth in the Prospectus Supplement under the
captions "Summary of the Prospectus Supplement," "Description of the
Mortgage Pool" and "Yield and Maturity Considerations" and on Annex A
agrees with the data sheet or computer tape prepared by or on behalf of the
Mortgage Loan Sellers, unless otherwise noted in such letter; and
(ii) they have compared the data contained in the data sheet or
computer tape referred to in the immediately preceding clause (i) to
information contained in an agreed
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<PAGE>
upon sampling of the Mortgage Loan files and in such other sources as shall
be specified by them, and found such data and information to be in
agreement, unless otherwise noted in such letter.
(f) On or before the Closing Date, such Underwriter shall have received
confirmation satisfactory to it that the Certificates have received the ratings
set forth in Schedule I.
(g) On or before the Closing Date, such Underwriter and counsel to the
Underwriters shall have been furnished with such other documents and opinions as
they may reasonably require, including, without limitation, opinions of counsel
to the Trustee, the Master Servicer and the Special Servicer, for the purpose of
enabling them to pass upon the issuance and sale of the Certificates as herein
contemplated and related proceedings, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Certificates as herein contemplated
shall be satisfactory in form and substance to such Underwriter and counsel to
the Underwriters.
SECTION 7. Indemnification.
(a) The Company shall indemnify and hold each Underwriter and each person,
if any, who controls such Underwriter within the meaning of either Section 15 of
the 1933 Act or Section 20 of the 1934 Act from and against any and all losses,
liabilities, claims and damages caused by any untrue statements or omissions, or
alleged untrue statements or omissions, in the information concerning the
Company included in the Registration Statement (or any amendment thereto) or any
Preliminary Prospectus or the Prospectus (or any amendment or supplement
thereto). The parties agree that the only information concerning the Company in
the Registration Statement is on page 30 of the Basic Prospectus under the
caption "The Depositor" and on page S-6 of the Prospectus Supplement under the
caption "Summary of the Prospectus Supplement Depositor.
(b) Each Underwriter shall indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement and each
person, if any, who controls the Company within the meaning of either Section 15
of the 1933 Act or Section 20 of the 1934 Act, against any and all losses,
liabilities, claims and damages as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, (i) jointly
and severally if made in any Preliminary Prospectus or the Prospectus (or any
amendment or supplement thereto) and (ii) severally and not jointly if made in
the Computational Materials or ABS Term Sheets prepared or distributed by such
Underwriter and incorporated by reference in the Registration Statement or the
Prospectus as a result of any filing pursuant to Section 5(i).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have otherwise than on account of this indemnity agreement. In case
any action is brought against any indemnified party and it notifies
14
<PAGE>
the indemnifying party of the commencement thereof, the indemnifying party may
participate at its own expense in the defense of any such action and, to the
extent that it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from the indemnified party, to
assume the defense thereof, with counsel satisfactory to such indemnified party.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have agreed to the retention of such counsel or (ii) the named
parties to any such proceeding (including any impleaded parties) include both
the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. In no event shall the indemnifying parties be
liable for fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
Unless it shall assume the defense of any proceeding, an indemnifying party
shall not be liable for any settlement of any proceeding, effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party shall indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. If an indemnifying party assumes the defense of any
proceeding, it shall be entitled to settle such proceeding with the consent of
the indemnified party or, if such settlement provides for release of the
indemnified party in connection with all matters relating to the proceeding that
have been asserted against the indemnified party in such proceeding by the other
parties to such settlement, without the consent of the indemnified party.
(d) If the indemnification provided for in this Section 7 is unavailable to
an indemnified parry under subsection (a) or (b) or insufficient in respect of
any losses, liabilities, claims or damages referred to therein, then the
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other from the offering of the Certificates or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and of each of the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company on the one hand and of the
Underwriters on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
(e) The parties hereto agree that it would not be just and equitable if
contribution were determined by pro rata allocation or by any other method of
allocation that does not take account of the considerations referred to in
subsection (d) above. The amount paid or payable by an indemnified party as a
result of the losses, liabilities, claims or damages referred to in this
15
<PAGE>
Section 7 shall be deemed to include any legal fees and disbursements or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such claim except where the indemnified party is
required to bear such expenses, which expenses the indemnifying party shall pay
as and when incurred, at the request of the indemnified party, to the extent
that the indemnifying party believes that it will be ultimately obligated to pay
such expenses. In the event that any expenses so paid by the indemnifying party
are subsequently determined to not be required to be borne by the indemnifying
party hereunder, the party which received such payment shall promptly refund the
amount so paid to the party which made such payment. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The remedies provided for in this Section 7
are not exclusive and shall not limit any rights or remedies that may otherwise
be available to any indemnified party at law or in equity.
(f) The indemnity and contribution agreements contained in this Section 7
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by the Company,
either Underwriter, any of their respective directors or officers, or any person
controlling the Company or an Underwriter, and (iii) acceptance of and payment
for any of the Certificates.
SECTION 8. Representations and Warranties to Survive Delivery.
All representations and warranties of the Company contained in this
Agreement shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of either Underwriter or any controlling
person in respect of such Underwriter, and shall survive delivery of the
Certificates to the Underwriters.
SECTION 9. Default by Either of the Underwriters.
If either of the Underwriters shall fail or refuse to purchase the
Certificates that it has agreed to purchase hereunder and arrangements
satisfactory to the non-defaulting Underwriter and the Company for the purchase
of such Certificates are not made within 36 hours after such default, this
Agreement will terminate without liability on the part of the non-defaulting
Underwriter or the Company. In any such case which does not result in
termination of this Agreement, either the non-defaulting Underwriter or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve the
defaulting Underwriter from liability in respect of any such default of such
Underwriter under this Agreement. The term "Underwriter" as used in this
Agreement shall also include, for all purposes of this Agreement, any party not
initially party to this Agreement who, with the approval of the non-defaulting
Underwriter and the Company, purchases the Certificates that the defaulting
Underwriter agreed, but failed or refused, to purchase.
16
<PAGE>
SECTION 10. Termination of Agreement.
(a) Either Underwriter may terminate its obligations under this Agreement,
by notice to the Company and the other Underwriter, at any time at or prior to
the Closing Date if the sale of the Certificates provided for herein is not
consummated because of any failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement.
(b) This Agreement shall be subject to termination in the absolute
discretion of either Underwriter, by notice given to the Company, if (A) after
the execution and delivery of this Agreement and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board of Options Exchange, the Chicago Mercantile Exchange or the Chicago Board
of Trade, (ii) trading of any securities of the Company shall have been
suspended on any exchange or in any over-the-counter market, (iii) a general
moratorium on commercial banking activities in New York shall have been declared
by either Federal or New York State authorities, or (iv) there shall have
occurred any outbreak or escalation of hostilities or any change in financial
markets or any calamity or crisis that, in the judgment of the Underwriters, is
material and adverse and (B) in the case of any of the events specified in
clauses (A)(i) through (iv) above, such event singly or together with any other
such event, makes it, in the judgment of the Underwriters, impracticable to
market the Certificates on the terms and in the manner contemplated in the
Prospectus.
(c) If the obligations of an Underwriter under this Agreement are
terminated pursuant to this Section and arrangements satisfactory to the
non-terminating Underwriter and the Company for the purchase of the Certificates
originally allocated to the non-terminating Underwriter as set forth on Schedule
I hereto are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any of the parties hereto.
SECTION 11. Notices.
All notices and other communications hereunder shall be in writing and
shall be deemed duly given if mailed or transmitted by any standard form of
communication. Notices to Merrill Lynch shall be directed to Merrill Lynch,
Pierce, Fenner & Smith Incorporated, World Financial Center, North Tower, New
York, New York 10281, Attention: Real Estate Investment Banking; notices to
Daiwa shall be directed to Daiwa Securities America Inc., Financial Square, 32
Old Slip, New York, New York 10005-3538, Attention: Commercial Mortgage
Department, with a copy to the General Counsel; and notices to the Company shall
be directed to Merrill Lynch Mortgage Investors, Inc., World Financial Center,
North Tower, New York, New York 100281- 1315, Attention: Secretary, with a copy
to the treasurer; or, as to any party, such other address as may hereafter be
furnished by such party to the others in writing.
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<PAGE>
SECTION 12. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Underwriters and the Company and their respective successors. Nothing expressed
or mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the Underwriters and the Company and
their respective successors and the controlling persons and officers and
directors referred to in Sections 7 and 8 and their respective successors, heirs
and legal representatives, any legal or equitable right, remedy or claim under
or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the Underwriters and the Company and their
respective successors, and said controlling persons and officers and directors
and their respective successors, heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Certificates
from an Underwriter shall be deemed to be a successor by reason merely of such
purchase.
SECTION 13. Governing Law and Time.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York applicable to agreements made and to be performed
in said State.
SECTION 14. Miscellaneous.
This Agreement supersedes all prior or contemporaneous agreements and
understandings relating to the subject matter hereof. Neither this Agreement nor
any term hereof may be changed, waived, discharged or terminated except by a
writing signed by the party against whom enforcement of such change, waiver,
discharge or termination is sought. This Agreement may be signed in any number
of counterparts, each of which shall be deemed an original, which taken together
shall constitute one and the same instrument.
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<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Underwriters and the Company in accordance with its terms.
Very truly yours,
MERRILL LYNCH MORTGAGE
INVESTORS, INC.
By: /s/ Bruce L. Ackerman
-------------------------------
Name: Bruce L. Ackerman
Title: Vice President
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Robert J. Fitzpatrick
----------------------------------
Name: Robert J. Fitzpatrick
Title: Authorized Signatory
DAIWA SECURITIES AMERICA INC.
By: /s/ Frank Keane
----------------------------------
Name: Frank Keane
Title: Vice President
19
<PAGE>
UNDERWRITING AGREEMENT, DATED AS OF JUNE 20, 1997 SCHEDULE I
CUT-OFF DATE: June 1, 1997
CERTIFICATES: Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1997-C1
<TABLE>
<CAPTION>
Percent of Percent of
Initial Aggregate Initial Aggregate
Initial Aggregate Certificate Balance or Certificate Balance or
Certificate Balance Notional Amount to be Notional Amount to
Class or Notional Purchased by be Purchased Initial Pass- Purchase
Designation Amount of Class Merrill Lynch by Daiwa Through Rate Price (3) Rating (4)
- ----------- ------------------ ---------------------- ----------------------- ------------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
A-1 $251,675,000 78.52% 21.48% 6.95% 100.96875% AAA/Aaa/AA
A
A-2 86,719,000 78.52% 21.48% 7.03% 100.95313% AAA/Aaa/AA
A
A-3 254,361,000 78.52% 21.48% 7.12% 100.96875% AAA/Aaa/AA
A
IO (1) 78.52% 21.48% (2) 7.67200% AAA/Aaa/NR
B 46,243,000 78.52% 21.48% 7.12% 100.57813% AA/Aa2/AA
C 46,244,000 78.52% 21.48% 7.12% 100.01563% A/A2/A
D 42,039,000 78.52% 21.48% 7.12% 99.17188% NR/Baa2/BBB
E 16,816,000 78.52% 21.48% 7.12% 96.81250% NR/Baa3/BBB
</TABLE>
- ------------
(1) The Class IO Certificates will not have a Certificate Balance, but will
represent the right to receive the sum of the interest accrued on the
notional amount of each of its Components. The Class IO-1 Component will
have a notional amount equal to the aggregate Stated Principal Balance of
the Mortgage Loans and the Class IO-2 Component will have a notional amount
equal to the aggregate Certificate Balance of the Class A-1 Certificates
and Class A-2 Certificates.
(2) The Class IO Certificates will accrue interest on the notional amount of
each of Component IO-1 and Component IO-2 as set forth in the Pooling and
Servicing Agreement.
(3) Expressed as a percentage of the initial aggregate Certificate Balance or
Notional Amount of the relevant class of Certificates to be purchased. The
purchase price for each class of the Certificates will include accrued
interest at the initial Pass-Through Rate therefor on the aggregate stated
or notional amount, as applicable, thereof to be purchased from the Cut-off
Date to but not including the Closing Date.
(4) By each of Fitch Investors Service, L.P., Moody's Investors Service, Inc.
and, except with respect to the Class IO Certificates, Standard & Poor's
Ratings Services, respectively. Neither the Class D Certificates nor the
Class E Certificates have been assigned a rating by Fitch Investors
Service, L.P.
<PAGE>
EXHIBIT A-1
(a) For Structural Term Sheets:
Investors should read the Underwriter's Statement which accompanies this
Structural Term Sheet.
Prospective investors are advised to read carefully, and should rely solely
on, the prospectus and prospectus supplement (the "Final Prospectus") relating
to the securities referred to herein in making their investment decision. This
Structural Term Sheet does not include all relevant information relating to the
Securities described herein (the "Securities"), particularly with respect to the
risks and special considerations associated with an investment in the
Securities. All structural information contained herein is preliminary and it is
anticipated that such information will change. Any information contained herein
will be more fully described in, and will be fully superseded by, the
descriptions of the collateral and structure in the preliminary prospectus
supplement and Final Prospectus. Although the information contained in this
Structural Term Sheet is based on sources which the Underwriter believes to be
reliable, the Underwriter makes no representation or warranty that such
information is accurate or complete. Such information should not be viewed as
projections, forecast, predictions or opinions with respect to value. Prior to
making any investment decision, a prospective investor shall receive and fully
review the Final Prospectus. NOTHING SHOULD BE CONSIDERED AN OFFER TO SELL OR
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES.
(b) For Computational Materials:
Investors should read the Underwriter's Statement which accompanies these
Computational Materials. If the Statement is not attached please contact your
account representative. Do not use or rely on this information if you have not
received and reviewed the Statement.
These Computational Materials have been based upon the assumptions
described above. These assumptions will most likely not represent the actual
experience of the Mortgage Pool in the future. The Computational Materials are
intended to illustrate variations in yield on the [Offered Certificates] under
such assumptions. No representation is made herein as to the actual rate or
timing of principal payments or prepayments on any of the underlying Mortgage
Loans in the Mortgage Pool or the actual performance characteristics of the
(Offered Certificates].
A-1-1
<PAGE>
EXHIBIT A-2
For Collateral Term Sheets:
Investors should read the Underwriter's Statement which accompanies this
Collateral Term Sheet.
Prospective investors are advised to carefully read, and should rely solely
on, the final prospectus and prospectus supplement (the "Final Prospectus")
relating to the securities referred to herein (the "Securities") in making their
investment decision. This Collateral Term Sheet does not include all relevant
information relating to the collateral described herein, particularly with
respect to the risks and special considerations associated therewith. All
collateral information contained herein is preliminary and such information may
change. Although the information contained in this Collateral Term Sheet is
based on sources which the Underwriter believes to be reliable, the Underwriter
makes no representation or warranty that such information is accurate or
complete. Such information should not be viewed as projections, forecasts,
predictions or opinions with respect to value. Prior to making any investment
decision, a prospective investor should receive and fully review the Final
Prospectus. NOTHING HEREIN SHOULD BE CONSIDERED AN OFFER TO SELL OR SOLICITATION
OF AN OFFER TO BUY ANY SECURITIES.
This Collateral Term Sheet and the information contained herein win be
superseded by the description of the collateral contained in the Prospectus
Supplement (for any Collateral Term Sheet following the initial Collateral Term
Sheet; and supersedes all prior Collateral Term Sheets and the information
contained herein].
A-2-1
==============================================================================
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Depositor
and
GE CAPITAL ASSET MANAGEMENT CORPORATION
Master Servicer
and
GE CAPITAL REALTY GROUP, INC.
Special Servicer
and
GENERAL ELECTRIC CAPITAL CORPORATION
and
LaSALLE NATIONAL BANK
Trustee
and
ABN AMRO BANK N.V.
Fiscal Agent
--------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of June 1, 1997
--------------------------------
Mortgage Pass-Through Certificates
Series 1997-C1
==============================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I DEFINITIONS
SECTION 1.01. Defined Terms...................................................4
Accrued Certificate Interest..............................................4
Accrued Component Interest................................................4
Acquisition Date..........................................................4
Additional Interest.......................................................4
Additional Interest Distribution Account..................................4
Additional Interest Rate..................................................5
Additional Trust Fund Expense.............................................5
Advance...................................................................5
Adverse REMIC Event.......................................................5
Affiliate.................................................................5
Agreement.................................................................5
Appraisal.................................................................5
Appraisal Reduction Amount................................................5
Appraised Value...........................................................6
Assignment of Leases......................................................6
Assumed Scheduled Payment.................................................6
Authenticating Agent......................................................6
Available Distribution Amount.............................................7
Balloon Mortgage Loan.....................................................7
Balloon Payment...........................................................7
Bankruptcy Code...........................................................7
Book-Entry Certificate....................................................7
Breach....................................................................7
Business Day..............................................................7
CERCLA....................................................................8
Certificate...............................................................8
Certificate Account.......................................................8
Certificate Factor........................................................8
Certificate Notional Amount...............................................8
Certificate Owner.........................................................8
Certificate Principal Balance.............................................8
Certificate Register......................................................8
Certificate Registrar.....................................................8
Certificateholder.........................................................8
Class.....................................................................9
Class A-1 Certificate.....................................................9
Class A-2 Certificate.....................................................9
Class A-3 Certificate.....................................................9
i
<PAGE>
Class B Certificate.......................................................9
Class C Certificate.......................................................9
Class D Certificate.......................................................9
Class E Certificate.......................................................9
Class F Certificate......................................................10
Class G Certificate......................................................10
Class H Certificate......................................................10
Class IO Certificate.....................................................10
Class J Certificate......................................................10
Class Prepayment Percentage..............................................10
Class Principal Balance..................................................10
Class R-I Certificate....................................................10
Class R-II Certificate...................................................10
Class R-III Certificate..................................................11
Closing Date.............................................................11
Code.....................................................................11
Collection Period........................................................11
Collection Report........................................................11
Component IO-1...........................................................11
Component IO-2a..........................................................11
Component IO-2b..........................................................11
Component................................................................11
Component Notional Amount................................................11
Controlling Class........................................................11
Controlling Class Representative.........................................12
Corporate Trust Office...................................................12
Corrected Mortgage Loan..................................................12
Custodian................................................................12
Cut-off Date.............................................................12
Cut-off Date Balance.....................................................12
Daiwa....................................................................12
Debt Service Coverage Ratio..............................................12
Defaulted Mortgage Loan..................................................12
Defeasance Collateral....................................................13
Defeasance Loan..........................................................13
Definitive Certificate...................................................13
Depositor................................................................13
Depository...............................................................13
Depository Participant...................................................13
Determination Date.......................................................13
Directly Operate.........................................................13
Disqualified Organization................................................14
Distributable Certificate Interest.......................................14
Distribution Account.....................................................14
Distribution Date........................................................14
ii
<PAGE>
Distribution Date Statement..............................................14
Document Defect..........................................................14
Due Date.................................................................14
Eligible Account.........................................................15
Environmental Assessment\................................................15
ERISA....................................................................15
Escrow Payment...........................................................15
Event of Default.........................................................16
Exchange Act.............................................................16
Expected Repayment Date..................................................16
Extension Adviser........................................................16
FDIC.....................................................................16
FHLMC....................................................................16
Final Recovery Determination.............................................16
Fiscal Agent.............................................................16
Fitch....................................................................16
FNMA.....................................................................16
GECAM....................................................................16
GECAM Mortgage Loans.....................................................16
GECC.....................................................................16
GECC Obligations.........................................................17
Ground Lease.............................................................17
Hazardous Materials......................................................17
Holder...................................................................17
Hyperamortization Mortgage Loans.........................................17
HUD-Approved Servicer....................................................17
Impound Reserve..........................................................17
Imputed Servicing Fee Rate...............................................17
Independent..............................................................17
Independent Appraiser....................................................17
Independent Contractor...................................................18
Initial Servicing Fee Rate...............................................18
Insurance Policy.........................................................18
Insurance Proceeds.......................................................18
Interested Person........................................................18
Investment Account.......................................................18
Issue Price..............................................................18
Late Collections.........................................................18
Liquidation Event........................................................19
Liquidation Proceeds.....................................................19
Loan-to-Value Ratio......................................................19
Majority Subordinate Certificateholder...................................19
Master Servicer..........................................................20
Merrill Lynch............................................................20
Monthly Payment..........................................................20
iii
<PAGE>
Moody's..................................................................20
Mortgage.................................................................20
Mortgage File............................................................20
Mortgage Loan............................................................22
Mortgage Loan Purchase Agreements........................................22
Mortgage Loan Schedule...................................................22
Mortgage Loan Seller.....................................................23
Mortgage Note............................................................23
Mortgage Pool............................................................23
Mortgage Rate............................................................23
Mortgaged Property.......................................................23
Mortgagor................................................................23
Net Aggregate Prepayment Interest Shortfall..............................23
Net Investment Earnings..................................................23
Net Investment Loss......................................................23
Net Mortgage Rate........................................................24
Net Operating Income.....................................................24
New Lease................................................................24
Non-GECAM Mortgage Loans.................................................24
Nonrecoverable Advance...................................................24
Nonrecoverable P&I Advance...............................................24
Nonrecoverable Servicing Advance.........................................24
Non-Registered Certificate...............................................24
Non-United States Person.................................................25
Officers' Certificate....................................................25
Opinion of Counsel.......................................................25
Original Component Notional Amount.......................................25
Original Class Principal Balance.........................................25
OTS......................................................................25
Ownership Interest.......................................................25
Pass-Through Rate........................................................25
Paying Agent.............................................................26
Penalty Interest.........................................................26
Percentage Interest......................................................26
Percentage Premium.......................................................26
Permitted Investments....................................................26
Permitted Transferee.....................................................28
Person...................................................................28
Phase I Environmental Assessment.........................................28
P&I Advance..............................................................28
P&I Advance Date.........................................................28
P&I Advance Date.........................................................28
Plurality Residual Certificateholder.....................................29
Prepayment Assumption....................................................29
Prepayment Interest Excess...............................................29
iv
<PAGE>
Prepayment Interest Shortfall............................................29
Prepayment Premium.......................................................29
Prime Rate...............................................................29
Principal Distribution Amount............................................29
Principal Prepayment.....................................................30
Principal Recovery Fee...................................................31
Prospectus...............................................................31
Prospectus Supplement....................................................31
Purchase Price...........................................................31
Qualified Insurer........................................................31
Rating Agency............................................................31
Realized Loss............................................................31
Record Date..............................................................32
Registered Certificate...................................................32
Regular Certificate......................................................32
Reimbursement Rate.......................................................32
Remaining Cash Flow......................................................32
REMIC....................................................................32
REMIC I..................................................................32
REMIC I Regular Interest.................................................33
REMIC I Remittance Rate..................................................33
REMIC II.................................................................33
REMIC II Regular Interest................................................33
REMIC II Remittance Rate.................................................33
REMIC III................................................................33
REMIC III Certificate....................................................33
REMIC Administrator......................................................33
REMIC Provisions.........................................................33
Rents from Real Property.................................................34
REO Account..............................................................34
REO Acquisition..........................................................34
REO Disposition..........................................................34
REO Extension............................................................34
REO Loan.................................................................34
REO Property.............................................................34
REO Revenues.............................................................35
REO Tax..................................................................35
Request for Release......................................................35
Required Appraisal.......................................................35
Required Appraisal Mortgage Loan.........................................35
Required Appraisal Value.................................................35
Reserve Account..........................................................35
Reserve Funds............................................................35
Residual Certificate.....................................................36
Responsible Officer......................................................36
v
<PAGE>
Revised Rate.............................................................36
Scheduled Payment........................................................36
Securities Act...........................................................36
Senior Certificate.......................................................36
Servicing Account........................................................36
Servicing Advances.......................................................36
Servicing Fee............................................................37
Servicing Fee Increase...................................................37
Servicing Fee Rate.......................................................37
Servicing File...........................................................37
Servicing Officer........................................................37
Servicing Standard.......................................................37
Servicing Transfer Event.................................................38
Single Certificate.......................................................38
Special Servicer.........................................................38
Special Servicing Fee....................................................38
Special Servicing Fee Rate...............................................38
Specially Serviced Mortgage Loan.........................................38
Standard & Poor's........................................................40
Startup Day..............................................................41
State and Local Taxes....................................................41
Stated Maturity Date.....................................................41
Stated Principal Balance.................................................41
Subordinated Certificate.................................................41
Sub-Servicer.............................................................41
Sub-Servicing Agreement..................................................41
Successor Servicing Fee Rate.............................................41
Tax Matters Person.......................................................42
Tax Returns..............................................................42
Transaction Screen Process...............................................42
Transfer.................................................................42
Transferee...............................................................42
Transferor...............................................................42
Treasury Spread Maintenance..............................................42
Trust Fund...............................................................42
Trustee..................................................................42
Trustee Fee Rate.........................................................43
Trustee Liability........................................................43
Trustee's Fee............................................................43
UCC......................................................................43
UCC Financing Statement..................................................43
Uncertificated Accrued Interest..........................................43
Uncertificated Distributable Interest....................................43
Uncertificated Principal Balance.........................................43
Underwriter..............................................................44
vi
<PAGE>
United States Person.....................................................44
Updated Mortgage Loan Schedule...........................................44
USAP.....................................................................44
Voting Rights............................................................44
Weighted Average Effective REMIC I Remittance Rate.......................45
Yield Maintenance Charge.................................................45
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans...................................46
SECTION 2.02. Acceptance of REMIC I by Trustee...............................47
SECTION 2.03. Mortgage Loan Seller's Repurchase of Mortgage Loans
for Document Defects and Breaches of
Representations and Warranties..............................48
SECTION 2.04. Representations and Warranties of Depositor....................50
SECTION 2.05. Execution, Authentication and Delivery of Class R-I
Certificates; Creation of REMIC I Regular
Interests...................................................51
SECTION 2.06. Conveyance of REMIC I Regular Interests; Acceptance
of REMIC II by Trustee......................................52
SECTION 2.07. Execution, Authentication and Delivery of Class R-II
Certificates................................................52
SECTION 2.08. Conveyance of REMIC II Regular Interests; Acceptance
of REMIC III by Trustee.....................................52
SECTION 2.09. Execution, Authentication and Delivery of REMIC III
Certificates................................................52
ARTICLE III ADMINISTRATION AND SERVICING OF THE TRUST FUND
SECTION 3.01. Administration of the Mortgage Loans...........................53
SECTION 3.02. Collection of Mortgage Loan Payments...........................54
SECTION 3.03. Collection of Taxes, Assessments and Similar Items;
Servicing Accounts; Reserve Accounts........................55
SECTION 3.04. Certificate Account, Distribution Account and
Additional Interest Distribution Account....................58
SECTION 3.05. Permitted Withdrawals From the Certificate Account
and the Distribution Account................................61
SECTION 3.06. Investment of Funds in the Certificate Account, the
Distribution Account, the Additional Interest
Distribution Account and the REO Account....................65
SECTION 3.07. Maintenance of Insurance Policies; Errors and
Omissions and Fidelity Coverage.............................67
SECTION 3.08. Enforcement of Alienation Clauses..............................69
SECTION 3.09. Realization Upon Defaulted Mortgage Loans; Required
Appraisals..................................................70
SECTION 3.10. Trustee and Custodian to Cooperate; Release of
Mortgage Files..............................................73
vii
<PAGE>
SECTION 3.11. Servicing Compensation.........................................74
SECTION 3.12. Property Inspections; Collection of Financial
Statements; Delivery of Certain Reports.....................77
SECTION 3.13. Annual Statement as to Compliance..............................79
SECTION 3.14. Reports by Independent Public Accountants......................79
SECTION 3.15. Access to Certain Information..................................80
SECTION 3.16. Title to REO Property; REO Account.............................81
SECTION 3.17. Management of REO Property.....................................83
SECTION 3.18. Sale of Mortgage Loans and REO Properties......................86
SECTION 3.19. Additional Obligations of Master Servicer......................89
SECTION 3.20. Modifications, Waivers, Amendments and Consents................89
SECTION 3.21. Transfer of Servicing Between Master Servicer and
Special Servicer; Record Keeping............................92
SECTION 3.22. Sub-Servicing Agreements.......................................93
SECTION 3.23. Representations and Warranties of Master Service
and Special Servicer........................................95
SECTION 3.24. Duties of Extension Adviser....................................99
SECTION 3.25. Election of Extension Adviser.................................100
SECTION 3.26. Limitation on Liability of Extension Adviser..................102
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.................................................103
SECTION 4.02. Statements to Certificateholders; Collection Reports..........111
SECTION 4.03. P&I Advances..................................................119
SECTION 4.04. Allocation of Realized Losses and Additional Trust
Fund Expenses..............................................121
SECTION 4.05. Calculations..................................................123
SECTION 4.06. Use of Agents.................................................123
ARTICLE V THE CERTIFICATES
SECTION 5.01. The Certificates..............................................125
SECTION 5.02. Registration of Transfer and Exchange of
Certificates...............................................125
SECTION 5.03. Book-Entry Certificates.......................................131
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates.............132
SECTION 5.05. Persons Deemed Owners.........................................132
ARTICLE VI THE DEPOSITOR, THE MASTER SERVICER, THE SPECIAL SERVICER AND THE
CONTROLLING CLASS REPRESENTATIVE
SECTION 6.01. Liability of Depositor, Master Servicer and Special
Servicer...................................................133
SECTION 6.02. Merger, Consolidation or Conversion of Depositor or
Master Servicer or Special Servicer........................133
SECTION 6.03. Limitation on Liability of Depositor, Master
Servicer and Special Servicer..............................133
viii
<PAGE>
SECTION 6.04. Resignation of Master Servicer and the Special
Servicer; Assignment of Rights and Obligations.............134
SECTION 6.05. Rights of Depositor and Trustee in Respect of Master
Servicer and the Special Servicer..........................135
SECTION 6.06. Depositor, Master Servicer and Special Servicer to
Cooperate with Trustee.....................................136
SECTION 6.07. Depositor, Special Servicer and Trustee to Cooperate
with Master Servicer.......................................136
SECTION 6.08. Depositor, Master Servicer and Trustee to Cooperate
with Special Servicer......................................136
SECTION 6.09. Designation of Special Servicer by the Controlling
Class......................................................136
SECTION 6.10. Master Servicer or Special Servicer as Owner of a
Certificate................................................137
SECTION 6.11. The Controlling Class Representative..........................138
ARTICLE VII DEFAULT
SECTION 7.01. Events of Default.............................................140
SECTION 7.02. Trustee to Act; Appointment of Successor......................143
SECTION 7.03. Notification to Certificateholders............................145
SECTION 7.04. Waiver of Events of Default...................................145
SECTION 7.05. Additional Remedies of Trustee Upon Event of Default..........146
SECTION 7.06. Obligations of GECC...........................................146
ARTICLE VIII CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee.............................................149
SECTION 8.02. Certain Matters Affecting Trustee.............................150
SECTION 8.03. Trustee and Fiscal Agent Not Liable for Validity or
Sufficiency of Certificates or Mortgage Loans..............151
SECTION 8.04. Trustee May Own Certificates..................................152
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of
Trustee....................................................152
SECTION 8.06. Eligibility Requirements for Trustee..........................153
SECTION 8.07. Resignation and Removal of Trustee............................153
SECTION 8.08. Successor Trustee.............................................155
SECTION 8.09. Merger or Consolidation of Trustee............................155
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.................156
SECTION 8.11. Appointment of Custodians.....................................157
SECTION 8.12. Appointment of Authenticating Agents..........................157
SECTION 8.13. Appointment of Paying Agent...................................158
SECTION 8.14. Appointment of REMIC Administrators...........................159
SECTION 8.15. Access to Certain Information.................................160
SECTION 8.16. Representations and Warranties of Trustee.....................160
SECTION 8.17. Reports to the Securities and Exchange Commission;
Available Information......................................161
SECTION 8.18. Fiscal Agent Appointed; Concerning the Fiscal Agent...........162
ix
<PAGE>
ARTICLE IX TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All
Mortgage Loans.............................................163
SECTION 9.02. Additional Termination Requirements...........................169
ARTICLE X ADDITIONAL REMIC PROVISIONS
SECTION 10.01. REMIC Administration.........................................170
ARTICLE XI MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment....................................................175
SECTION 11.02. Recordation of Agreement; Counterparts.......................177
SECTION 11.03. Limitation on Rights of Certificateholders...................177
SECTION 11.04. Governing Law................................................178
SECTION 11.05. Notices......................................................178
SECTION 11.06. Severability of Provisions...................................178
SECTION 11.07. Grant of a Security Interest.................................179
SECTION 11.08. Successors and Assigns; Beneficiaries........................179
SECTION 11.09. Article and Section Headings.................................179
SECTION 11.10. Notices to Rating Agencies...................................180
SECTION 11.11. Complete Agreement...........................................181
x
<PAGE>
EXHIBITS
Exhibit Description Exhibit No. Section Reference
------------------- ----------- -----------------
Form of Class A-1 Certificate A-1 Section 1.01 Definition
of "Class A-1
Certificate"
Form of Class A-2 Certificate A-2 Section 1.01 Definition
of "Class A-2
Certificate"
Form of Class A-3 Certificate A-3 Section 1.01 Definition
of "Class A-3
Certificate"
Form of Class IO Certificate A-4 Section 1.01 Definition
of "Class IO Certificate"
Form of Class B Certificate A-5 Section 1.01 Definition
of "Class B Certificate"
Form of Class C Certificate A-6 Section 1.01 Definition
of "Class C Certificate"
Form of Class D Certificate A-7 Section 1.01 Definition
of "Class D Certificate"
Form of Class E Certificate A-8 Section 1.01 Definition
of "Class E Certificate"
Form of Class F Certificate A-9 Section 1.01 Definition
of "Class F Certificate"
Form of Class G Certificate A-10 Section 1.01 Definition
of "Class G Certificate"
Form of Class H Certificate A-11 Section 1.01 Definition
of "Class H Certificate"
Form of Class J Certificate A-12 Section 1.01 Definition
of "Class J Certificate"
Form of Class R-I Certificate A-13 Section 1.01 Definition
of "Class R-I
Certificate"
Form of Class R-II Certificate A-14 Section 1.01 Definition
of "Class R-II
Certificate"
xi
<PAGE>
Exhibit Description Exhibit No. Section Reference
------------------- ----------- -----------------
Form of Class R-III Certificate A-15 Section 1.01 Definition
of "Class R-III
Certificate"
Mortgage Loan Schedule B Section 1.01 Definition
of "Mortgage Loan
Schedule"
Form of Schedule of Exceptions to C Section 2.02(a)
Mortgage File Delivery
Form of Master Servicer D-1 Section 1.01 Definition
Request for Release of "Request for Release";
Section 2.03(b); Section
3.10(a); and Section
3.10(b)
Form of Special Servicer D-2 Section 1.01 Definition
Request for Release of "Request for
Release"; Section 3.10(b)
Calculation of NOI/Debt E-1 Section 1.01 Definition
Service Coverage Ratios of "Net Operating
Income"; Section 3.12(b)
Form of Updated Mortgage Loan E-2 Section 3.12(c); and
Schedule Section 4.02(b)
Copy of Letter of F Section 4.01(e)
Representations among
Depositor, Trustee and initial
Depository
Form of Certificate from G-1 Section 5.02(b)
Holder (Transferor) of a
Certificate to the Certificate
Registrar
Form of Certificate from G-2 Section 5.02(b)
Proposed Transferee of a
Certificate to Certificate
Registrar
Form of Certificate from G-3 Section 5.02(b)
Proposed Transferee of a
Certificate to Certificate
Registrar for non-QIBs
xii
<PAGE>
Exhibit Description Exhibit No. Section Reference
------------------- ----------- -----------------
Form of Certificate (to H Section 5.02(c)
Certificate Registrar) by
Prospective Transferor that it
is not a Plan or certain other
Persons
Form of Transfer Affidavit and I-1 Section 5.02(d)(i)(B)
Agreement regarding Class R-I
Certificates
Form of Transferor Certificate I-2 Section 5.02(d)(i)(D)
regarding Class R-I, R-II and
R-III Certificates
Form of Notice and J-1 Section 6.09
Acknowledgment
Form of Acknowledgment of J-2 Section 6.09
Proposed Special Servicer
Form of UCC-1 financing K Section 11.07
statement
Form of Schedule of Holders of L Section 4.02(a)
each Class of Regular
Certificates
Form of Master Servicer M Section 4.02(b)
Collection Report
xiii
<PAGE>
This Pooling and Servicing Agreement (this "Agreement") is dated and
effective as of June 1, 1996, among MERRILL LYNCH MORTGAGE INVESTORS, INC., as
Depositor, GE CAPITAL ASSET MANAGEMENT CORPORATION, as Master Servicer, GE
CAPITAL REALTY GROUP, INC., as Special Servicer, GENERAL ELECTRIC CAPITAL
CORPORATION ("GECC"), LASALLE NATIONAL BANK, as Trustee, and ABN AMRO BANK,
N.V., as Fiscal Agent.
PRELIMINARY STATEMENT:
The Depositor intends to sell mortgage pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes
(each, a "Class"), which in the aggregate will evidence the entire beneficial
ownership interest in a trust fund (the "Trust Fund") to be created hereunder.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the Mortgage Loans (as defined herein) and a portion of the
interest payments thereon as well as certain other related assets subject to
this Agreement as a real estate mortgage investment conduit (a "REMIC") for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC I." The Class R-I Certificates will represent the sole
class of "residual interests" in REMIC I for purposes of the REMIC Provisions
(as defined herein) under the federal income tax law. Except as provided below,
each of the "regular interests" in REMIC I (each, a "REMIC I Regular Interest")
will relate to a specific Mortgage Loan. Each such REMIC I Regular Interest will
have a remittance rate equal to the Net Mortgage Rate (as defined herein) of the
Mortgage Loan to which such REMIC I Regular Interest relates, an initial
Uncertificated Principal Balance equal to the Cut-off Date Balance (as defined
herein) of the Mortgage Loan to which such REMIC I Regular Interest relates and
a latest possible maturity date that corresponds to the Stated Maturity Date of
the Mortgage Loan to which such REMIC I Regular Interest relates.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC I Regular Interests as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated as "REMIC
II." The Class R-II Certificates will represent the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions under federal income
tax law. The following table sets forth the designation, remittance rate (the
"REMIC II Remittance Rate"), the initial Uncertificated Principal Balance and
latest possible maturity date for each of the "regular interests" in REMIC II
(the "REMIC II Regular Interests"). None of the REMIC II Regular Interests will
be certificated.
<PAGE>
-2-
<TABLE>
<CAPTION>
Initial
Uncertificated
Corresponding Principal Balance or
REMIC III REMIC II Initial Notional Rated Final
Designation Regular Interest Remittance Rate Principal Amount Distribution Date(3)
----------- ---------------- --------------- ---------------- ---------------------
<S> <C> <C> <C> <C>
P Class A-1 7.12% $251,675,000 June 18, 2029 (4)
Q Class A-2 7.12% $86,719,000 June 18, 2029 (4)
R Class A-3 7.12% $254,361,000 June 18, 2029 (4)
IO Class IO-1 Variable(1) $840,787,856 (2) June 18, 2029 (4)
S Class B 7.12% $46,243,000 June 18, 2029 (4)
T Class C 7.12% $46,244,000 June 18, 2029 (4)
U Class D 7.12% $42,039,000 June 18, 2029 (4)
V Class E 7.12% $16,816,000 June 18, 2029 (4)
W Class F 7.12% $50,447,000 June 18, 2029 (4)
X Class G 7.12% $8,408,000 June 18, 2029 (4)
Y Class H 7.12% $16,816,000 June 18, 2029 (4)
Z Class J 7.12% $21,019,856 June 18, 2029 (4)
</TABLE>
- -----------------
(1) The rate equal to the difference between (a) the Weighted Average Effective
REMIC I Remittance Rate (as defined below), and (b) 7.12%.
(2) The Notional Principal Amount of the REMIC II Class IO Certificate is equal
to the Stated Principal Balance of the Mortgage Loans.
(3) Determined solely for purposes of satisfying Treasury Regulation Section
1.860G-1(a)(4)(iii).
(4) Set to the date that is two years after the first Distribution Date that
follows the end of the amortization term for the Mortgage Loan that, as of
the Cut-off Date, has the longest amortization term scheduled maturity
date.
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC II Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
REMIC III. The Class R-III Certificates will evidence the sole class of
"residual interests" in REMIC III for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designation, pass-through rate (the "Pass-Through Rate"), initial aggregate
stated principal amount (the initial "Class Principal Balance") and latest
possible maturity date for each of the Regular Certificates. For federal income
tax purposes, each of the Components of the Class IO Certificates will be
designated as a regular interest in REMIC III.
<PAGE>
-3-
Class Initial Class Rated Final
Designation Pass-Through Rate(1) Principal Balance Distribution Date(3)
- ----------- -------------------- ----------------- --------------------
Class A-1 6.95% $251,675,000 June 18, 2029 (4)
Class A-2 7.03% $ 86,719,000 June 18, 2029 (4)
Class A-3 7.12% $254,361,000 June 18, 2029 (4)
Class IO (2) (2) June 18, 2029 (4)
Class B 7.12% $ 46,243,000 June 18, 2029 (4)
Class C 7.12% $ 46,244,000 June 18, 2029 (4)
Class D 7.12% $ 42,039,000 June 18, 2029 (4)
Class E 7.12% $ 16,816,000 June 18, 2029 (4)
Class F 7.12% $ 50,447,000 June 18, 2029 (4)
Class G 7.12% $ 8,408,000 June 18, 2029 (4)
Class H 7.12% $ 16,816,000 June 18, 2029 (4)
Class J 7.12% $ 21,019,856 June 18, 2029 (4)
- ------------------
(1) Calculated in accordance with the definition of "Pass-Through Rate".
(2) The Class IO Certificates will not have specified Class Principal Balances,
and will not be entitled to receive distributions of principal, but will be
entitled to receive payments of interest in an amount equal to the sum of
the interest accrued on the Component Notional Amount of each of its three
Components.
(3) Determined solely for purposes of satisfying Treasury Regulations Section
1.860G-1(a)(4)(iii).
(4) Set to the date that is two years after the Distribution Date that follows
the end of the amortization term for the Mortgage Loan that, as of the
Cut-off Date, has the longest amortization term.
The aggregate Cut-off Date Balance (as defined herein) of the Mortgage
Loans, the initial aggregate Uncertificated Principal Balance of the REMIC I
Regular Interests, the initial aggregate Uncertificated Principal Balance of the
REMIC II Regular Interests and the initial aggregate Class Principal Balance of
the respective Classes of Certificates evidencing "regular interests" in REMIC
III will in each case be $840,787,856.
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer, the Special Servicer, GECC, the Trustee and the Fiscal
Agent agree as follows:
<PAGE>
-4-
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms.
Whenever used in this Agreement, including in the Preliminary Statement,
the following words and phrases, unless the context otherwise requires, shall
have the meanings specified in this Article.
"Accrued Certificate Interest": With respect to any Class of Regular
Certificates (other than the Class IO Certificates) for any Distribution Date,
one month's interest at the Pass-Through Rate applicable to such Class of
Certificates, accrued on the related Class Principal Balance outstanding
immediately prior to such Distribution Date and with respect to the Class IO
Certificates for any Distribution Date, the sum of Accrued Component Interest
for each of its Components for such Distribution Date. Accrued Certificate
Interest shall be calculated on the basis of a 360-day year consisting of twelve
30-day months.
"Accrued Component Interest": With respect to the Class IO Certificates and
each Component thereof for any Distribution Date, the sum of one month's
interest at the Pass-Through Rate applicable to such Component for such
Distribution Date, accrued on the Component Notional Amount of such Component,
outstanding immediately prior to such Distribution Date. Accrued Component
Interest shall be calculated on the basis of a 360-day year consisting of twelve
30-day months.
"Acquisition Date": With respect to any REO Property, the first day on
which such REO Property is considered to be acquired by the Trust Fund within
the meaning of Treasury Regulations Section 1.856-6(b)(1), which is the first
day on which the Trust Fund is treated as the owner of such REO Property for
federal income tax purposes.
"Additional Information": As defined in Section 4.02(a).
"Additional Interest": With respect to each of the Mortgage Loans indicated
on the Mortgage Loan Schedule as having a Revised Rate, interest accrued on such
Mortgage Loan allocable to the Additional Interest Rate. The Additional Interest
shall not be an asset of REMIC I, REMIC II or REMIC III.
"Additional Interest Distribution Account": The trust account or accounts
created and maintained as a separate trust account or accounts by the Trustee
pursuant to Section 3.04(c), which shall be entitled "LaSalle National Bank, as
Trustee, in trust for Holders of Merrill Lynch Mortgage Investors, Inc.,
Mortgage Pass-Through Certificates, Series 1997-C1, Additional Interest
Distribution Account" and which must be an Eligible Account. The Additional
Interest Distribution Account shall not be an asset of REMIC I, REMIC II or
REMIC III.
<PAGE>
-5-
"Additional Interest Rate": With respect to each of the Hyperamortization
Mortgage Loans, the excess of (i) the applicable Revised Rate over (ii) the
applicable Mortgage Rate, each as set forth in the Mortgage Loan Schedule.
"Additional Trust Fund Expense": Any Special Servicing Fees, Principal
Recovery Fees and, in accordance with Sections 3.03(d) and 4.03(d), interest
payable to the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent on Advances, as well as any of the expenses of the Trust Fund that may be
withdrawn (x) pursuant to any of clauses (viii), (ix), (xi), (xii) and (xiii) of
Section 3.05(a) out of general collections on the Mortgage Loans and any REO
Properties on deposit in the Certificate Account or (y) pursuant to clause (ii)
or any of clauses (iv) through (vi) of Section 3.05(b) out of general
collections on the Mortgage Loans and any REO Properties on deposit in the
Distribution Account; provided that for purposes of the allocations contemplated
by Section 4.04 no such expense shall have been incurred by the Trust Fund until
such time as the payment thereof is actually made from the Certificate Account
or the Distribution Account, as the case may be.
"Advance": Any P&I Advance or Servicing Advance.
"Adverse REMIC Event": As defined in Section 10.01(i).
"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all amendments hereof
and supplements hereto.
"Appraisal": With respect to any Mortgage Loan, an Independent appraisal of
the related Mortgaged Property conducted in accordance with the standards of the
Appraisal Institute by an Independent Appraiser, which Independent Appraiser
shall be advised to take into account the factors specified in Section 3.18(e),
including without limitation, any environmental, engineering or other third
party reports available, and other factors that a prudent real estate appraiser
would consider.
"Appraisal Reduction Amount": The excess, if any, of (a) the sum of, as of
the Determination Date immediately succeeding the date on which a Required
Appraisal is obtained (without duplication), (i) the Stated Principal Balance of
the subject Required Appraisal Mortgage Loan, (ii) to the extent not previously
advanced by or on behalf of the Master Servicer, the Trustee or the Fiscal
Agent, all unpaid interest on the Required Appraisal Mortgage Loan through the
most recent Due Date prior to such Determination Date at a per annum rate equal
to the related Net Mortgage Rate, (iii) all accrued but unpaid Servicing Fees,
<PAGE>
-6-
and Additional Trust Fund Expenses in respect of such Required Appraisal
Mortgage Loan, (iv) all related unreimbursed Advances made by or on behalf of
the Master Servicer, the Special Servicer, the Trustee or the Fiscal Agent with
respect to such Required Appraisal Mortgage Loan and (v) all currently due and
unpaid real estate taxes (net of any amounts escrowed therefor) and assessments,
insurance premiums, and, if applicable, ground rents in respect of the related
Mortgaged Property over (b) the Required Appraisal Value; provided, however,
that if the related Required Appraisal Mortgage Loan becomes a Corrected
Mortgage Loan, then the Appraisal Reduction Amount shall be deemed to be zero,
subject to such Mortgage Loan again becoming a Required Appraisal Mortgage Loan,
and provided further, that with respect to any Mortgage Loan that becomes a
Required Appraisal Mortgage Loan pursuant to clause (iii) of the definition
thereof, the Appraisal Reduction Amount shall be deemed to exist,
notwithstanding such Required Appraisal Mortgage Loan becoming a Corrected
Mortgage Loan, for so long as the terms of the modification effected pursuant to
Section 3.20 are in effect.
"Appraised Value": With respect to each Mortgaged Property, the appraised
value thereof based upon the most recent appraisal or update thereof that is
contained in the related Servicing File.
"Assignment of Leases": With respect to any Mortgaged Property, any
assignment of leases, rents and profits or similar document or instrument
executed by the Mortgagor in connection with the origination of the related
Mortgage Loan.
"Assumed Scheduled Payment": With respect to any Balloon Mortgage Loan
following its Stated Maturity Date (provided that such Mortgage Loan has not
been paid in full on or before such date and no other Liquidation Event has
occurred in respect thereof) and for any subsequent Due Date therefor as of
which such Mortgage Loan remains outstanding and part of the Trust Fund, the
scheduled monthly payment of principal and/or interest deemed to be due in
respect thereof on such Due Date equal to the Scheduled Payment that would have
been due in respect of such Mortgage Loan on such Due Date if it had been
required to continue to pay in accordance with the amortization schedule in
effect prior to its Stated Maturity Date and without regard to the occurrence of
its Stated Maturity Date. With respect to any REO Loan, for any Due Date
therefor as of which the related REO Property remains part of the Trust Fund,
the scheduled monthly payment of principal and/or interest deemed to be due in
respect thereof on such Due Date equal to the Scheduled Payment that would have
been due in respect of the predecessor Mortgage Loan on such Due Date had it
remained outstanding (or, if the predecessor Mortgage Loan was a Balloon
Mortgage Loan and such Due Date coincides with or follows what had been its
Stated Maturity Date, the Assumed Scheduled Payment that would have been deemed
due in respect of the predecessor Mortgage Loan on such Due Date had it remained
outstanding).
"Authenticating Agent": Any authenticating agent appointed pursuant to
Section 8.12.
<PAGE>
-7-
"Available Distribution Amount": With respect to any Distribution Date, an
amount equal to, without duplication, (a) the sum of (i) the aggregate of the
amounts on deposit in the Certificate Account and the Distribution Account as of
the close of business on the related Determination Date and the amounts
collected by or on behalf of the Master Servicer as of the close of business on
such Determination Date and required to be deposited in the Certificate Account,
(ii) the aggregate amount of any P&I Advances made by the Master Servicer, the
Trustee or the Fiscal Agent for distribution on the Certificates on such
Distribution Date pursuant to Section 4.03, (iii) the aggregate amount
transferred from the REO Account (if established) to the Certificate Account
during the month of such Distribution Date, on or prior to the P&I Advance Date
in such month, pursuant to Section 3.16(c), and (iv) the aggregate amount
deposited by the Master Servicer in the Distribution Account for such
Distribution Date pursuant to Section 3.19 in connection with Prepayment
Interest Shortfalls, net of (b) the portion of the amount described in
subclauses (a)(i) and (a)(iii) of this definition that represents one or more of
the following: (i) collected Monthly Payments that are due on a Due Date
following the end of the related Collection Period, (ii) any amounts payable or
reimbursable to any Person from the (A) Certificate Account pursuant to clauses
(ii)-(xiv) of Section 3.05(a) or (B) the Distribution Account pursuant to
clauses (ii) - (viii) of Section 3.05(b), (iii) Prepayment Premiums, (iv)
Additional Interest, and (v) any amounts deposited in the Certificate Account or
the Distribution Account in error.
"Balloon Mortgage Loan": Any Mortgage Loan that by its original terms or by
virtue of any modification entered into as of the Closing Date provides for an
amortization schedule extending beyond its Stated Maturity Date.
"Balloon Payment": With respect to any Balloon Mortgage Loan as of any date
of determination, the Scheduled Payment payable on the Stated Maturity Date of
such Mortgage Loan.
"Bankruptcy Code": The federal Bankruptcy Code, as amended from time to
time (Title 11 of the United States Code).
"Book-Entry Certificate": Any Certificate registered in the name of the
Depository or its nominee.
"Breach": As defined in Section 2.03(a).
"Business Day": Any day other than a Saturday, a Sunday or a day on which
banking institutions in New York, New York or the city in which the Corporate
Trust Office of the Trustee is located, are authorized or obligated by law or
executive order to remain closed.
"CERCLA": The Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
<PAGE>
-8-
"Certificate": Any one of the Depositor's Mortgage Pass-Through
Certificates, Series 1997-C1, as executed by the Certificate Registrar and
authenticated and delivered hereunder by the Authenticating Agent.
"Certificate Account": The segregated account or accounts created and
maintained by the Master Servicer pursuant to Section 3.04(a) on behalf of the
Trustee in trust for Certificateholders, which shall be entitled "GE Capital
Asset Management Corporation, as Master Servicer for LaSalle National Bank, as
Trustee, on behalf of and in trust for the registered holders of Merrill Lynch
Mortgage Investors, Inc., Mortgage Pass-Through Certificates, Series 1997-C1".
"Certificate Factor": With respect to any Class of Regular Certificates
(other than the Class IO Certificates), as of any date of determination, a
fraction, expressed as a decimal carried to six places, the numerator of which
is the then current Class Principal Balance of such Class of Regular
Certificates, as the case may be, and the denominator of which is the related
Original Class Principal Balance.
"Certificate Notional Amount": The sum of the Component Notional Amounts
with respect to Component IO-1, Component IO-2a and Component IO-2b,
respectively.
"Certificate Owner": With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Certificate as reflected on the books of the
Depository or on the books of a Depository Participant or on the books of an
indirect participating brokerage firm for which a Depository Participant acts as
agent.
"Certificate Principal Balance": With respect to any Regular Certificate
(other than a Class IO Certificate), as of any date of determination, the then
outstanding principal amount of such Certificate equal to the product of (a) the
Percentage Interest evidenced by such Certificate, multiplied by (b) the then
Class Principal Balance of the Class of Certificates to which such Certificate
belongs.
"Certificate Register" and "Certificate Registrar": The register maintained
and the registrar appointed pursuant to Section 5.02.
"Certificateholder": The Person in whose name a Certificate is registered
in the Certificate Register, except that (i) neither a Disqualified Organization
nor a Non-United States Person shall be Holder of a Residual Certificate for any
purpose hereof and, (ii) solely for the purposes of giving any consent, approval
or waiver pursuant to this Agreement that relates to any of the Depositor, any
Mortgage Loan Seller, the Master Servicer, the Special Servicer, GECC, the
Trustee or the Fiscal Agent in its respective capacity as such (except with
respect to amendments referred to in Sections 3.20(d) and 11.01 hereof and any
consent approval or waiver required or permitted to be made by the Majority
Subordinate Certificateholder or Controlling Class Representative), any
Certificate registered in
<PAGE>
-9-
the name of the Depositor, any Mortgage Loan Seller, the Master Servicer, the
Special Servicer, GECC, the Trustee, or the Fiscal Agent as the case may be, or
any Certificate registered in the name of any of its Affiliates, shall be deemed
not to be outstanding, and the Voting Rights to which it is entitled shall not
be taken into account in determining whether the requisite percentage of Voting
Rights necessary to effect any such consent, approval or waiver that relates to
it has been obtained. The Certificate Registrar shall be entitled to request and
rely upon a certificate of the Depositor, GECC, the Master Servicer or the
Special Servicer in determining whether a Certificate is registered in the name
of an Affiliate of such Person. All references herein to "Holders" or
"Certificateholders" shall reflect the rights of Certificate Owners as they may
indirectly exercise such rights through the Depository and the Depository
Participants, except as otherwise specified herein; provided, however, that the
parties hereto shall be required to recognize as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register.
"Class": Collectively, all of the Certificates bearing the same
alphabetical and, if applicable, numerical class designation.
"Class A-1 Certificate": Any one of the Certificates with a "Class A-1"
designation on the face thereof, substantially in the form of Exhibit A-1
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class A-2 Certificate": Any one of the Certificates with a "Class A-2"
designation on the face thereof, substantially in the form of Exhibit A-2
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class A-3 Certificate": Any one of the Certificates with a "Class A-3"
designation on the face thereof, substantially in the form of Exhibit A-3
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class B Certificate": Any one of the Certificates with a "Class B"
designation on the face thereof, substantially in the form of Exhibit A-5
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class C Certificate": Any one of the Certificates with a "Class C"
designation on the face thereof, substantially in the form of Exhibit A-6
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class D Certificate": Any one of the Certificates with a "Class D"
designation on the face thereof, substantially in the form of Exhibit A-7
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class E Certificate": Any one of the Certificates with a "Class E"
designation on the face thereof, substantially in the form of Exhibit A-8
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
<PAGE>
-10-
"Class F Certificate": Any one of the Certificates with a "Class F"
designation on the face thereof, substantially in the form of Exhibit A-9
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class G Certificate": Any one of the Certificates with a "Class G"
designation on the face thereof, substantially in the form of Exhibit A-10
attached hereto, and evidencing a "regular interest" in REMIC III for purposes
of the REMIC Provisions.
"Class H Certificate": Any of the Certificates with a "Class H" designation
on the face thereof, substantially in the form of Exhibit A-11 attached hereto,
and evidencing a "regular interest" in REMIC III for purposes of the REMIC
Provisions.
"Class IO Certificate": Any one of the Certificates with a "Class IO"
designation on the face thereof, substantially in the form of Exhibit A-4
attached hereto, and evidencing the aggregate of the Components, each of which
shall constitute a "regular interest" in REMIC III for purposes of the REMIC
Provisions.
"Class J Certificate": Any of the Certificates with a "Class J" designation
on the face thereof, substantially in the form of Exhibit A-12 attached hereto,
and evidencing a "regular interest" in REMIC III for purposes of the REMIC
Provisions.
"Class Prepayment Percentage": With respect to any Distribution Date and
any of the Class A-1, Class A-2, Class A-3, Class B, Class C, Class D, Class E,
Class F, Class G Class H and Class J Certificates, the percentage obtained by
dividing the portion, if any, of the Principal Distribution Amount distributed
to the respective Class of Certificates on such Distribution Date, by the total
Principal Distribution Amount distributed to all Classes of Certificates on such
Distribution Date.
"Class Principal Balance": The aggregate principal amount of any Class of
Regular Certificates (other than the Class IO Certificates) outstanding as of
any date of determination. As of the Closing Date, the Class Principal Balance
of each such Class of Certificates shall equal the Original Class Principal
Balance thereof. On each Distribution Date, the Class Principal Balance of each
such Class of Certificates shall be reduced by the amount of any distributions
of principal made thereon on such Distribution Date pursuant to Section 4.01 or
9.01, as applicable, and shall be further reduced by the amount of any Realized
Losses and Additional Trust Fund Expenses allocated thereto on such Distribution
Date pursuant to Section 4.04(a).
"Class R-I Certificate": Any one of the Certificates with a "Class R-I"
designation on the face thereof, substantially in the form of Exhibit A-13
attached hereto, and evidencing the sole class of "residual interests" in REMIC
I for purposes of the REMIC Provisions.
"Class R-II Certificate": Any one of the Certificates with a "Class R-II"
designation on the face thereof, substantially in the form of Exhibit A-14
attached hereto, and
<PAGE>
-11-
evidencing the sole class of "residual interests" in REMIC II for purposes of
the REMIC Provisions.
"Class R-III Certificate": Any one of the Certificates with a "Class R-III"
designation on the face thereof, substantially in the form of Exhibit A-15
attached hereto, and evidencing the sole class of "residual interests" in REMIC
III for purposes of the REMIC Provisions.
"Closing Date": June 26, 1996.
"Code": The Internal Revenue Code of 1986.
"Collection Period": With respect to any Distribution Date, the period
commencing on the day immediately following the Determination Date for the
preceding Distribution Date (or, in the case of the initial Distribution Date,
commencing immediately following the Cut-off Date) and ending on and including
the related Determination Date.
"Collection Report": The monthly report, to be prepared by the Master
Servicer and the Special Servicer, to be delivered to the Trustee and the
Depositor pursuant to Section 4.02(b).
"Component IO-1": One of three Components of the Class IO Certificates
having a Component Notional Amount equal to the then current aggregate Stated
Principal Balance of the Mortgage Loans as of any date of determination.
"Component IO-2a": One of three Components of the Class IO Certificates
having a Component Notional Amount equal to the then current Uncertificated
Principal Balance of REMIC II Regular Interest P as of any date of
determination.
"Component IO-2b": One of three Components of the Class IO Certificates
having a Component Notional Amount equal to the then current Uncertificated
Principal Balance of REMIC II Regular Interest Q as of any date of
determination.
"Component": Each of Component IO-1, Component IO-2a and Component IO-2b,
and collectively, the "Components", each evidencing a separate "regular
interest" in REMIC III for purposes of the REMIC Provisions.
"Component Notional Amount": The notional principal amount on which any of
the Components accrue interest.
"Controlling Class": As of any date of determination, the Class of
Certificates outstanding, other than the Residual Certificates or the Class IO
Certificates, (a) which bear the latest alphabetical Class designation and (b)
the Class Principal Balance of which is greater than 20% of the Original Class
Principal Balance thereof; provided, however, that if no such Class of
Certificates has a Class Principal Balance greater than 20% of its Original
Class
<PAGE>
-12-
Balance, the Controlling Class shall be the Class of Certificates (other
than the Residual Certificates or the Class IO Certificates) bearing the latest
alphabetical Class designation. With respect to determining the Controlling
Class, the Class A-1, Class A-2 and Class A-3 Certificates shall be deemed a
single Class of Certificates.
"Controlling Class Representative": As defined in Section 6.09.
"Corporate Trust Office": The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 135 South LaSalle Street, Suite 1740,
Chicago, Illinois 60674-4107, Attention: Merrill Lynch 1997 C-1.
"Corrected Mortgage Loan": Any Mortgage Loan that had been a Specially
Serviced Mortgage Loan but has ceased to be such in accordance with the
definition of "Specially Serviced Mortgage Loan".
"Custodian": A Person who is at any time appointed by the Trustee pursuant
to Section 8.11 as a document custodian for the Mortgage Files, which Person
shall not be the Depositor or an Affiliate of the Depositor. If no such
custodian has been appointed or if such custodian has been so appointed, but the
Trustee shall have terminated such appointment, then the Trustee shall be the
Custodian.
"Cut-off Date": June 1, 1997.
"Cut-off Date Balance": With respect to any Mortgage Loan, the outstanding
principal balance of such Mortgage Loan as of the Cut-off Date, after
application of all unscheduled payments of principal received on or before such
date and the principal component of all Scheduled Payments due on or before such
date, whether or not received.
"Daiwa": Daiwa Securities America Inc. or its successor in interest.
"Debt Service Coverage Ratio": With respect to any Mortgage Loan, as of any
date of determination, the ratio of (x) the annualized Net Operating Income
(before payment of any debt service on such Mortgage Loan) generated by the
related Mortgaged Property during the most recently ended period of not less
than six months and not more than twelve months for which financial statements,
if available (whether or not audited) have been received by or on behalf of the
related Mortgage Loan Seller (prior to the Closing Date) or the Master Servicer
or the Special Servicer (following the Closing Date), to (y) twelve times the
amount of the Monthly Payment in effect for such Mortgage Loan as of such date
of determination.
"Defaulted Mortgage Loan": A Mortgage Loan (i) that is delinquent in an
amount equal to at least two Monthly Payments (not including the Balloon
Payment) or is delinquent thirty days or more in respect of its Balloon Payment,
in either case such delinquency to be determined without giving effect to any
grace period permitted by the
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related Mortgage or Mortgage Note and without regard to any acceleration of
payments under the related Mortgage and Mortgage Note, or (ii) as to which the
Master Servicer or the Special Servicer has, by written notice to the related
Mortgagor, accelerated the maturity of the indebtedness evidenced by the related
Mortgage Note.
"Defeasance Collateral": With respect to any Defeasance Loan, the United
States treasury obligations required or permitted to be pledged in lieu of
prepayment pursuant to the terms thereof.
"Defeasance Loan": Any Mortgage Loan which permits the related Mortgagor to
pledge Defeasance Collateral to such holder in lieu of prepayment.
"Definitive Certificate": As defined in Section 5.03(a).
"Depositor": Merrill Lynch Mortgage Investors, Inc. or its successor in
interest.
"Depository": The Depository Trust Company, or any successor Depository
hereafter named as contemplated by Section 5.03(c). The nominee of the initial
Depository for purposes of registering those Certificates that are to be
Book-Entry Certificates, is Cede & Co. The Depository shall at all times be a
"clearing corporation" as defined in Section 8-102(3) of the Uniform Commercial
Code of the State of New York and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Securities Exchange Act of 1934, as amended.
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the ninth day
of the month in which such Distribution Date occurs, or if such ninth day is not
a Business Day, the Business Day immediately preceding.
"Directly Operate": With respect to any REO Property, the furnishing or
rendering of services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for sale or lease,
the performance of any construction work thereon or any use of such REO Property
in a trade or business conducted by REMIC I other than through an Independent
Contractor; provided, however, that the Trustee (or the Special Servicer or any
Sub-Servicer on behalf of the Trustee) shall not be considered to Directly
Operate an REO Property solely because the Trustee (or the Special Servicer or
any Sub-Servicer on behalf of the Trustee) establishes rental terms, chooses
tenants, enters into or renews leases, deals with taxes and insurance, or makes
decisions as to repairs or capital expenditures with respect to such REO
Property.
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"Disqualified Organization": Any of the following: (i) the United States or
a possession thereof, any State or any political subdivision thereof, or any
agency or instrumentality of any of the foregoing (other than an instrumentality
which is a corporation if all of its activities are subject to tax and, except
for FHLMC, a majority of its board of directors is not selected by any such
governmental unit), (ii) a foreign government, international organization, or
any agency or instrumentality of either of the foregoing, (iii) any organization
(except certain farmers' cooperatives described in Section 521 of the Code)
which is exempt from the tax imposed by Chapter 1 of the Code (unless such
organization is subject to the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381 of the Code or (v) any other Person so
designated by the Trustee or the Certificate Registrar based upon an Opinion of
Counsel that the holding of an Ownership Interest in a Residual Certificate by
such Person may cause the Trust Fund or any Person having an Ownership Interest
in any Class of Certificates, other than such Person, to incur a liability for
any federal tax imposed under the Code that would not otherwise be imposed but
for the Transfer of an Ownership Interest in a Residual Certificate to such
Person. The terms "United States", "State" and "international organization"
shall have the meanings set forth in Section 7701 of the Code or successor
provisions.
"Distributable Certificate Interest": With respect to any Class of Regular
Certificates for any Distribution Date, the Accrued Certificate Interest in
respect of such Class of Certificates for such Distribution Date, reduced (to
not less than zero) by the product of (i) any Net Aggregate Prepayment Interest
Shortfall for such Distribution Date, multiplied by (ii) a fraction, expressed
as a decimal, the numerator of which is the Accrued Certificate Interest in
respect of such Class of Certificates for such Distribution Date, and the
denominator of which is the aggregate Accrued Certificate Interest in respect of
all the Classes of Regular Certificates for such Distribution Date.
"Distribution Account": The segregated account or accounts created and
maintained by the Paying Agent on behalf of the Trustee pursuant to Section
3.04(b) which shall be entitled LaSalle National Bank, as Trustee, in trust for
the registered holders of Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1."
"Distribution Date": The 18th day of any month, or if such 18th day is not
a Business Day, the Business Day immediately following, commencing in July,
1997.
"Distribution Date Statement": As defined in Section 4.02(a).
"Document Defect": As defined in Section 2.03(a).
"Due Date": With respect to (i) any Mortgage Loan on or prior to its Stated
Maturity Date, the day of the month set forth in the related Mortgage Note on
which each Monthly Payment on such Mortgage Loan is scheduled to be first due;
(ii) any Mortgage Loan after its Stated Maturity Date, the day of the month set
forth in the related Mortgage Note on
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which each Monthly Payment on such Mortgage Loan had been scheduled to be first
due; and (iii) any REO Loan, the day of the month set forth in the related
Mortgage Note on which each Monthly Payment on the related Mortgage Loan had
been scheduled to be first due.
"Eligible Account": Any of (i) an account maintained with a federal or
state chartered depository institution or trust company, and with respect to
deposits held for 30 days or more in such account the (a) long-term deposit or
unsecured debt obligations of (or of such institution's parent holding company)
which are rated "AA" by Fitch (if then rated by Fitch), "AA-" by Standard &
Poor's, and "A2" by Moody's (if then rated by Moody's) or such lower rating as
will not result in qualification, downgrading or withdrawal of the ratings then
assigned to the Certificates, as evidenced in writing by the Rating Agencies, at
any time such funds are on deposit therein, or with respect to deposits held for
less than 30 days in such account the (b) short-term deposits of which (or of
such institution's parent holding company) are rated F-1+, P-1 and A-1 by Fitch
(if then rated by Fitch), Moody's (if then rated by Moody's) and Standard &
Poor's, respectively, or such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to the Certificates, as
evidenced in writing by the Rating Agencies at any time such funds are on
deposit therein; provided, however, that notwithstanding the foregoing,
"Eligible Account" shall include deposits held at Bankers Trust New York Corp.
for more than 30 days so long as its long-term deposits or unsecured debt
obligations are rated at least A+ by Standard and Poors, A1 by Moody's and AA-
by Fitch, or (ii) a segregated trust account or accounts maintained with a
federal or state chartered depository institution or trust company acting in its
fiduciary capacity, which, in the case of a state chartered depository
institution or trust company, is subject to regulations regarding fiduciary
funds on deposit therein substantially similar to 12 CFR ss. 9.10(b), having in
either case a combined capital and surplus of at least $50,000,000 and subject
to supervision or examination by federal or state authority, or the use of such
account would not, in and of itself, cause a qualification, downgrading or
withdrawal of the then-current rating assigned to any Class of Certificates, as
confirmed in writing by each Rating Agency.
"Environmental Assessment": A "Phase I assessment" as described in, and
meeting the criteria of, (a) (i) Chapter 5 of the FNMA Multifamily Guide or any
successor provisions covering the same subject matter, in the case of Specially
Serviced Mortgage Loans as to which the related Mortgaged Property is
multi-family property, or (ii) the Servicing Standard, in the case of any other
Specially Serviced Mortgage Loans, and (b) the American Society for Testing and
Materials.
"ERISA": The Employee Retirement Income Security Act of 1974, as amended.
"Escrow Payment": Any payment received by the Master Servicer or the
Special Servicer for the account of any Mortgagor for application toward the
payment of real estate taxes, assessments, insurance premiums, ground rents (if
applicable) and other items for which an escrow or reserve has been created in
respect of the related Mortgaged Property.
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"Event of Default": One or more of the events described in Section 7.01(a).
"Exchange Act": Securities Exchange Act of 1934, as amended.
"Expected Repayment Date": With respect to a Hyperamortization Mortgage
Loan, the date upon which such Mortgage Loan commences accruing interest at the
Revised Rate.
"Extension Adviser": As defined in Section 3.25(a).
"FDIC": Federal Deposit Insurance Corporation or any successor.
"FHLMC": Federal Home Loan Mortgage Corporation or any successor.
"Final Recovery Determination": A determination by the Special Servicer
with respect to any Defaulted Mortgage Loan or REO Property (other than a
Mortgage Loan or REO Property, as the case may be, that was purchased by the
Mortgage Loan Seller pursuant to the related Mortgage Loan Purchase Agreement,
by the Majority Subordinate Certificateholder pursuant to Section 3.18(b), by
the Master Servicer or the Special Servicer pursuant to Section 3.18(c) or by
the Depositor or the Master Servicer pursuant to Section 9.01) that there has
been a recovery of all Insurance Proceeds, Liquidation Proceeds and other
payments or recoveries that the Special Servicer has determined, in accordance
with the Servicing Standard, will be ultimately recoverable.
"Fiscal Agent": ABN AMRO Bank N.V., a Netherlands banking corporation in
its capacity as fiscal agent of the Trustee, or its successor in interest, or
any successor fiscal agent appointed as herein provided.
"Fitch": Fitch Investors Service, L.P. or its successor in interest. If
neither such rating organization nor any successor remains in existence, "Fitch"
shall be deemed to refer to such other nationally recognized statistical rating
organization or other comparable Person designated by the Depositor, notice of
which designation shall be given to the Trustee, the Fiscal Agent, the Master
Servicer and the Special Servicer, and specific ratings of Fitch herein
referenced shall be deemed to refer to the equivalent ratings of the party so
designated.
"FNMA": Federal National Mortgage Association or any successor.
"GECAM": GE Capital Asset Management Corporation, the initial Master
Servicer hereunder, or any successor to GECAM.
"GECAM Mortgage Loans": Those Mortgage Loans identified on the Mortgage
Loan Schedule that will initially be directly serviced by GECAM.
"GECC": General Electric Capital Corporation, an affiliate of GECAM.
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"GECC Obligations": The obligation of GECC to make certain remittances to
the Trustee pursuant to Section 7.02(b) of this Agreement.
"Ground Lease": As defined in Section 2.01(e)(xix) hereof.
"Hazardous Materials": Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including, without limitation, those so
identified pursuant to CERCLA or any other federal, state or local environmental
related laws and regulations now existing or hereafter enacted, and specifically
including, without limitation, asbestos and asbestos-containing materials,
polychlorinated biphenyls ("PCBs"), radon gas, petroleum and petroleum products
and urea formaldehyde.
"Holder": A Certificateholder.
"Hyperamortization Mortgage Loans": Mortgage Loan Nos. 85, 190, 195, 209
and 219 on the Mortgage Loan Schedule.
"HUD-Approved Servicer": A servicer approved by the Secretary of Housing
and Urban Development pursuant to Section 207 of the National Housing Act.
"Impound Reserve": As defined in Section 3.16(c) hereof.
"Imputed Servicing Fee Rate": A per annum rate equal to (a) 0.035% over the
Initial Servicing Fee Rate with respect to the Non-GECAM Mortgage Loans and, to
the extent GECAM continues as primary servicer in respect thereof, the GECAM
Mortgage Loans and (b) 0.075% with respect to any GECAM Mortgage Loans to the
extent that GECAM does not continue as primary servicer in respect thereof.
"Independent": When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, the Mortgage Loan
Sellers, the Master Servicer, the Special Servicer and any and all Affiliates
thereof, (ii) does not have any direct financial interest in or any material
indirect financial interest in any of the Depositor, the Master Servicer, the
Special Servicer or any Affiliate thereof, and (iii) is not connected with the
Depositor, the Master Servicer, the Special Servicer or any Affiliate thereof as
an officer, employee, promoter, underwriter, trustee, partner, director or
Person performing similar functions; provided, however, that a Person shall not
fail to be Independent of the Depositor, the Master Servicer, the Special
Servicer or any Affiliate thereof merely because such Person is the beneficial
owner of 1% or less of any class of securities issued by the Depositor, the
Master Servicer, the Special Servicer or any Affiliate thereof, as the case may
be.
"Independent Appraiser": An Independent professional real estate appraiser
who is a member in good standing of the Appraisal Institute, and, if the State
in which the subject Mortgaged Property is located certifies or licenses
appraisers, certified or licensed in such State, and in each such case, who has
a minimum of five years experience in the subject property type and market.
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"Independent Contractor": Any Person that would be an "independent
contractor" with respect to REMIC I within the meaning of Section 856(d)(3) of
the Code if REMIC I were a real estate investment trust (except that the
ownership test set forth in that section shall be considered to be met by any
Person that owns, directly or indirectly, 35 percent or more of any Class of
Certificates, or such other interest in any Class of Certificates as is set
forth in an Opinion of Counsel, which shall be at no expense to the Master
Servicer, the Special Servicer, the Trustee or the Trust Fund, delivered to the
Trustee), so long as REMIC I does not receive or derive any income from such
Person and provided that the relationship between such Person and REMIC I is at
arm's length, all within the meaning of Treasury regulation Section
1.856-4(b)(5), or any other Person upon receipt by the Trustee of an Opinion of
Counsel, which shall be at no expense to the Master Servicer, the Special
Servicer, the Trustee or the Trust Fund, to the effect that the taking of any
action in respect of any REO Property by such Person, subject to any conditions
therein specified, that is otherwise herein contemplated to be taken by an
Independent Contractor will not cause such REO Property to cease to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code, or
cause any income realized in respect of such REO Property to fail to qualify as
Rents from Real Property.
"Initial Servicing Fee Rate": A per annum rate equal to (a) 0.0000% with
respect to the GECAM Mortgage Loans and (b) with respect to the Non-GECAM
Mortgage Loans, the annual rate set forth therefor in the Mortgage Loan Schedule
(except with respect to the definition of Imputed Servicing Fee Rate, which rate
on the Mortgage Loan Schedule shall be deemed to be .04%).
"Insurance Policy": With respect to any Mortgage Loan, any hazard insurance
policy, flood insurance policy, title policy or other insurance policy that is
maintained from time to time in respect of such Mortgage Loan or the related
Mortgaged Property.
"Insurance Proceeds": Proceeds paid under any Insurance Policy, to the
extent such proceeds are not applied to the restoration of the related Mortgaged
Property, released to the Mortgagor, or any tenants or ground lessors, as the
case may be, pursuant to the terms of the related Mortgage or lease, in
accordance with the Servicing Standard.
"Interested Person": The Depositor, the Mortgage Loan Sellers, the Master
Servicer, the Special Servicer, any Holder of a Certificate, or any Affiliate of
any such Person.
"Investment Account": As defined in Section 3.06(a).
"Issue Price": With respect to each Class of Certificates, the "issue
price" as defined in the applicable provisions of the Code and Treasury
Regulations promulgated thereunder.
"Late Collections": With respect to any Mortgage Loan, all amounts received
thereon during any Collection Period, other than Penalty Interest or late
payment fees, whether as payments, Insurance Proceeds, Liquidation Proceeds or
otherwise, which represent late collections
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of the principal and/or interest portions of a Scheduled Payment (other than a
Balloon Payment) or an Assumed Scheduled Payment in respect of such Mortgage
Loan due or deemed due on a Due Date in a previous Collection Period, or on a
Due Date coinciding with or preceding the Cut-off Date, and not previously
recovered. With respect to any REO Loan, all amounts received in connection with
the related REO Property during any Collection Period, whether as Insurance
Proceeds, Liquidation Proceeds, REO Revenues or otherwise, which represent late
collections of the principal and/or interest portions of an Assumed Scheduled
Payment in respect of the predecessor Mortgage Loan or of an Assumed Scheduled
Payment in respect of such REO Loan due or deemed due on a Due Date in a
previous Collection Period and not previously recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made with respect to such Mortgage Loan; (iii) such Mortgage
Loan is repurchased by a Mortgage Loan Seller pursuant to the related Mortgage
Loan Purchase Agreement; or (iv) such Mortgage Loan is purchased by the Majority
Subordinate Certificateholder pursuant to Section 3.18(b), by the Master
Servicer or the Special Servicer pursuant to Section 3.18(c) or by the Depositor
or the Master Servicer pursuant to Section 9.01. With respect to any REO
Property (and the related REO Loan), any of the following events: (i) a Final
Recovery Determination is made with respect to such REO Property; or (ii) such
REO Property is purchased by the Depositor or the Master Servicer pursuant to
Section 9.01.
"Liquidation Proceeds": All cash amounts (other than Insurance Proceeds and
REO Revenues) received by the Master Servicer or the Special Servicer in
connection with: (i) the taking of all or a part of a Mortgaged Property by
exercise of the power of eminent domain or condemnation, subject, however, to
the rights of any tenants and ground lessors, as the case may be, and the terms
of the related Mortgage; (ii) the liquidation of a Mortgaged Property or other
collateral constituting security for a defaulted Mortgage Loan, through
trustee's sale, foreclosure sale, REO Disposition or otherwise, exclusive of any
portion thereof required to be released to the related Mortgagor in accordance
with applicable law and the terms and conditions of the related Mortgage Note
and Mortgage; (iii) the realization upon any deficiency judgment obtained
against a Mortgagor; (iv) the purchase of a Defaulted Mortgage Loan by the
Majority Subordinate Certificateholder pursuant to Section 3.18(b) or by the
Master Servicer or the Special Servicer pursuant to Section 3.18(c) or any other
sale thereof pursuant to Section 3.18(d); (v) the repurchase of a Mortgage Loan
by a Mortgage Loan Seller pursuant to the related Mortgage Loan Purchase
Agreement; or (vi) the purchase of a Mortgage Loan or REO Property by the
Depositor or the Master Servicer pursuant to Section 9.01.
"Loan-to-Value Ratio": With respect to any Mortgage Loan, as of any date of
determination, a fraction, expressed as a percentage, the numerator of which is
the then current principal amount of such Mortgage Loan, and the denominator of
which is the Appraised Value of the related Mortgaged Property.
"Majority Subordinate Certificateholder": As of any date of determination,
any single Holder of Certificates entitled to greater than 50% of the Voting
Rights allocated to the Class of outstanding Regular Certificates (other than
the Class IO Certificates) with the latest alphabetical
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Class designation; provided, however, that if there is no Holder of Certificates
entitled to greater than 50% of the Voting Rights of such Class, the single
Holder of Certificates with the largest percentage of Voting Rights allocated to
such Class. With respect to determining the Majority Subordinate
Certificateholder, the Class A-1, Class A-2 and Class A-3 Certificates shall be
deemed to be a single Class of Certificates, with such Voting Rights allocated
among the Holders of Certificates of such Classes in proportion to the
respective Certificate Principal Balances of such Certificates as of such date
of determination.
"Master Servicer": GECAM, its successor in interest, or any successor
master servicer appointed as herein provided.
"Merrill Lynch": Merrill Lynch, Pierce, Fenner & Smith Incorporated or its
successor in interest.
"Monthly Payment": With respect to any Mortgage Loan as of any Due Date,
the scheduled monthly payment of principal and interest or interest only on such
Mortgage Loan, including any Balloon Payment, that is actually payable by the
related Mortgagor from time to time under the terms of the related Mortgage Note
(as such terms may be changed or modified in connection with a bankruptcy or
similar proceeding involving the related Mortgagor or by reason of a
modification, waiver or amendment granted or agreed to by the Special Servicer
pursuant to Section 3.20).
"Moody's": Moody's Investors Service, Inc. or its successor in interest. If
neither such rating agency nor any successor remains in existence, "Moody's"
shall be deemed to refer to such other nationally recognized statistical rating
agency or other comparable Person designated by the Depositor, notice of which
designation shall be given to the Trustee, the Fiscal Agent, the Master Servicer
and the Special Servicer, and specific ratings of Moody's Investors Service,
Inc. herein referenced shall be deemed to refer to the equivalent ratings of the
party so designated.
"Mortgage": With respect to any Mortgage Loan, the mortgage, deed of trust,
deed to secure debt or similar instrument that secures the Mortgage Note and
creates a lien on the related Mortgaged Property.
"Mortgage File": With respect to any Mortgage Loan, collectively the
following documents:
(i) the original executed Mortgage Note, endorsed (without recourse,
representation or warranty, express or implied) to the order of
LaSalle National Bank, as trustee for the registered holders of
Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1997-C1;
(ii) an original or copy of the Mortgage and of any intervening
assignments thereof, in each case with evidence of recording
indicated thereon;
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(iii) an original or copy of any related Assignment of Leases (with
recording information indicated thereon), if such item is a
document separate from the Mortgage;
(iv) (a) an original executed assignment of the Mortgage and any
intervening assignments thereof, (b) any related Assignment of
Leases (if such item is a document separate from the Mortgage)
and any intervening assignments thereof, and (c) any other
recorded document relating to the Mortgage Loan otherwise
included in the Mortgage File, in favor of _____ as trustee for
the registered holders of Merrill Lynch Mortgage Investors, Inc.,
Mortgage Pass-Through Certificates, Series 1997-C1, in recordable
form;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of _____, as trustee for the
registered holders of Merrill Lynch Mortgage Investors, Inc.,
Mortgage Pass-Through Certificates, Series 1997-C1;
(vi) originals or copies of any written modification agreements in
those instances where the terms or provision of the Mortgage or
Mortgage Note have been modified;
(vii) the original or a copy of the policy or certificate of lender's
title insurance issued on the date of the origination of such
Mortgage Loan, or, if such policy has not been issued, an
irrevocable, binding commitment to issue such title insurance
policy; and
(viii) any filed copies of any prior UCC Financing Statements in favor
of the originator of such Mortgage Loan or in favor of any
assignee prior to the Trustee (but only to the extent the
Mortgage Loan Seller had possession of such UCC Financing
Statements prior to the Closing Date) and, if there is an
effective UCC Financing Statement in favor of the Mortgage Loan
Seller on record with the applicable public office for UCC
Financing Statements, an original UCC-2 or UCC-3 assignment, as
appropriate, in favor of LaSalle National Bank, as trustee for
the registered holders of Merrill Lynch Mortgage Investors, Inc.,
Mortgage Pass-Through Certificates, Series 1997-C1;
provided that whenever the term "Mortgage File" is used to refer to documents
actually received by the Trustee or by a Custodian on its behalf, such term
shall not be deemed to include such documents required to be included therein
unless they are actually so received, and with respect to any receipt or
certification by the Trustee or the Custodian for documents described in clause
(vi) of this definition, shall be deemed to include only such documents to the
extent the Trustee or Custodian has actual knowledge of their existence.
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"Mortgage Loan": Each of the mortgage loans listed on the Mortgage Loan
Schedule and from time to time held in the Trust Fund. As used herein, the term
"Mortgage Loan" includes the related Mortgage Note, Mortgage and other security
documents contained in the related Mortgage File.
"Mortgage Loan Purchase Agreements": Those certain Mortgage Loan Purchase
Agreements, each dated as of June 1, 1997, between the Depositor and the
respective Mortgage Loan Seller and relating to the transfer of the related
Mortgage Loans to the Depositor.
"Mortgage Loan Schedule": The list of Mortgage Loans transferred on the
Closing Date to the Trustee as part of REMIC I, attached hereto as Exhibit B and
in a computer readable format. Such list shall set forth the following
information with respect to each Mortgage Loan:
(i) the Mortgage Loan number;
(ii) the street address (including city, state and zip code) of the
related Mortgaged Property;
(iii) the Cut-off Date Balance;
(iv) the amount of the Monthly Payment due on the first Due Date
following the Closing Date;
(v) the Mortgage Rate;
(vi) the (A) remaining term to stated maturity and (B) the Stated
Maturity Date;
(vii) in the case of a Balloon Mortgage Loan, the remaining
amortization term;
viii) whether the Mortgage Loan is secured by a Ground Lease;
(ix) the Initial Servicing Fee Rate;
(x) in the case of a Hyperamortization Mortgage Loan, the Expected
Repayment Date;
(xi) the related Mortgage Loan Seller; and
(xii) the related Sub-Servicer.
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"Mortgage Loan Seller": Each of Merrill Lynch Mortgage Capital Inc. or its
successor in interest, GE Capital Access, Inc. or its successor in interest and
Daiwa Finance Corp. or its successor in interest.
"Mortgage Note": The original executed note evidencing the indebtedness of
a Mortgagor under a Mortgage Loan, together with any rider, addendum or
amendment thereto, or any renewal, substitution or replacement of such note.
"Mortgage Pool": Collectively, all of the Mortgage Loans and any successor
REO Loans.
"Mortgage Rate": With respect to (i) any Mortgage Loan on or prior to its
Stated Maturity Date, the fixed annualized rate, not including any Additional
Interest Rate, at which interest is scheduled (in the absence of a default) to
accrue on such Mortgage Loan from time to time in accordance with the related
Mortgage Note and applicable law; (ii) any Mortgage Loan after its Stated
Maturity Date, the annualized rate described in clause (i) above determined
without regard to the passage of such Maturity Date but giving effect to any
modification thereof as contemplated by Section 3.20; and (iii) any REO Loan,
the annualized rate described in clause (i) or (ii), as applicable, above
determined as if the predecessor Mortgage Loan had remained outstanding.
"Mortgaged Property": The property subject to the lien of a Mortgage.
"Mortgagor": The obligor or obligors on a Mortgage Note, including without
limitation, any Person that has acquired the related Mortgaged Property and
assumed the obligations of the original obligor under the Mortgage Note.
"Net Aggregate Prepayment Interest Shortfall": With respect to any
Distribution Date, the amount, if any, by which (a) the aggregate of all
Prepayment Interest Shortfalls incurred in connection with the receipt of
Principal Prepayments on the Mortgage Loans during the related Collection
Period, exceeds (b) the aggregate amount deposited by the Master Servicer in the
Certificate Account for such Distribution Date pursuant to Section 3.19 in
connection with such Prepayment Interest Shortfalls.
"Net Investment Earnings": With respect to the Certificate Account, the
Distribution Account or the REO Account (if any) for any Collection Period, the
amount, if any, by which the aggregate of all interest and other income realized
during such Collection Period on funds held in such account, exceeds the
aggregate of all losses of principal, if any, incurred during such Collection
Period in connection with the investment of such funds in accordance with
Section 3.06.
"Net Investment Loss": With respect to the Certificate Account, the
Distribution Account or the REO Account (if any) for any Collection Period, the
amount by which the aggregate of all losses of principal, if any, incurred
during such Collection Period in connection
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with the investment of funds held in such account in accordance with Section
3.06, exceeds the aggregate of all interest and other income realized during
such Collection Period on such funds.
"Net Mortgage Rate": With respect to any Mortgage Loan or any REO Loan, as
of any date of determination, a rate per annum equal to the related Mortgage
Rate minus the sum of the Trustee Fee Rate and the related Initial Servicing Fee
Rate; provided that if the related Mortgage Rate has been modified in connection
with a bankruptcy or similar proceeding involving the related Mortgagor or a
modification, waiver or amendment granted or agreed to by the Special Servicer
pursuant to Section 3.20, the Net Mortgage Rate for such Mortgage Loan or REO
Loan shall be calculated without regard to such event; and provided further,
that if such Mortgage Loan or REO Loan is not accrued on the basis of a 360-day
year consisting of twelve 30-day months, then, solely for purposes of
determining the related REMIC I Remittance Rate and thereby calculating the
REMIC II Remittance Rate for the REMIC II Class IO Regular Interest and the
Pass-Through Rate for Component IO-1 for any Distribution Date, such Net
Mortgage Rate will, to the extent appropriate, be adjusted from accrual period
to accrual period to compensate for such difference.
"Net Operating Income": As defined in and determined in accordance with the
provisions of Exhibit E-1 attached hereto.
"New Lease": Any lease of REO Property entered into on behalf of REMIC I,
including any lease renewed, modified or extended on behalf of REMIC I if REMIC
I has the right to renegotiate the terms of such lease.
"Non-GECAM Mortgage Loans": Those Mortgage Loans identified on the Mortgage
Loan Schedule that initially will be primarily serviced by a Sub-Servicer.
"Nonrecoverable Advance": Any Nonrecoverable P&I Advance or Nonrecoverable
Servicing Advance.
"Nonrecoverable P&I Advance": Any P&I Advance previously made or proposed
to be made in respect of any Mortgage Loan or REO Loan that, as determined by
the Master Servicer, the Trustee or the Fiscal Agent with respect to any P&I
Advance it respectively is obligated to make in accordance with the Servicing
Standard, will not be ultimately recoverable from late payments, Insurance
Proceeds or Liquidation Proceeds, or any other recovery on or in respect of such
Mortgage Loan or REO Loan.
"Nonrecoverable Servicing Advance": Any Servicing Advance previously made
or proposed to be made in respect of a Mortgage Loan or REO Loan that, as
determined by the Master Servicer or the Special Servicer in accordance with the
Servicing Standard, will not be ultimately recoverable from late payments,
Insurance Proceeds, Liquidation Proceeds, or any other recovery on or in respect
of such Mortgage Loan or REO Property.
"Non-Registered Certificate": Unless and until registered under the
Securities Act, any Class F, Class G, Class H, Class J, Class R-I, Class R-II or
Class R-III Certificate.
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"Non-United States Person": Any person other than a United States Person.
"Officers' Certificate": A certificate signed by a Servicing Officer of the
Master Servicer or the Special Servicer, as the case may be, or by a Responsible
Officer of the Trustee or the Fiscal Agent, as the case may be.
"Opinion of Counsel": A written opinion of counsel (which counsel shall be
Independent of the Depositor, the Master Servicer and the Special Servicer)
acceptable to and delivered to the Trustee or the Master Servicer, as the case
may be.
"Original Component Notional Amount": With respect to each Component, the
initial Component Notional Amount thereof as of the Closing Date equal to
$840,787,856, with respect to Component IO-1, $251,675,000 with respect to
Component IO-2a, and $86,719,000 with respect to Component IO-2b.
"Original Class Principal Balance": With respect to any Class of Regular
Certificates (other than the Class IO Certificates), the initial Class Principal
Balance thereof as of the Closing Date, in each case as specified in the
Preliminary Statement.
"OTS": The Office of Thrift Supervision or any successor thereto.
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate as the Holder thereof and any other
interest therein, whether direct or indirect, legal or beneficial, as owner
or as pledgee.
"Pass-Through Rate": With respect to:
(i) the Class A-1 Certificates for any Distribution Date, 6.95%;
(ii) the Class A-2 Certificates for any Distribution Date, 7.03%;
(iii) the Class A-3 Certificates for any Distribution Date, 7.12%;
(iv) the Class B Certificates for any Distribution Date, 7.12%;
(v) the Class C Certificates for any Distribution Date, 7.12%;
(vi) the Class D Certificates for any Distribution Date, 7.12%;
(vii) the Class E Certificates for any Distribution Date, 7.12%;
(viii) the Class F Certificates for any Distribution Date, 7.12%;
(ix) the Class G Certificates for any Distribution Date, 7.12%;
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(x) the Class H Certificates for any Distribution Date, 7.12%;
(xi) the Class J Certificates for any Distribution Date, 7.12%;
(xii) Component IO-1 for any Distribution Date, the Weighted Average
Effective REMIC I Remittance Rate for such Distribution Date minus
7.12%;
(xiii) Component IO-2a for any Distribution Date, 0.17%; and
(xiv) Component IO-2b for any Distribution Date, 0.09%.
"Paying Agent": The paying agent appointed pursuant to Section 8.13. If no
such paying agent has been appointed or if such paying agent has been so
appointed, but the Trustee shall have terminated such appointment, then the
Trustee shall be the Paying Agent.
"Penalty Interest": With respect to any Mortgage Loan (or successor REO
Loan), any amounts collected thereon, other than late payment charges,
Additional Interest or Prepayment Premiums, that represent penalty interest in
excess of interest on the Stated Principal Balance of such Mortgage Loan (or
successor REO Loan) accrued at the related Mortgage Rate.
"Percentage Interest": With respect to any Regular Certificate, the portion
of the relevant Class evidenced by such Certificate, expressed as a percentage,
the numerator of which is the Certificate Principal Balance or Certificate
Notional Amount of such Certificate as of the Closing Date, as specified on the
face thereof, and the denominator of which is the Original Class Principal
Balance or original Certificate Notional Balance of the relevant Class. With
respect to a Residual Certificate, the percentage interest in distributions to
be made with respect to the relevant Class, as stated on the face of such
Certificate.
"Percentage Premium": Any premium, penalty or fee (other than a Yield
Maintenance Charge or Treasury Spread Maintenance) paid or payable, as the
context requires, by a Mortgagor in connection with a Principal Prepayment.
"Permitted Investments": Any one or more of the following obligations or
securities having maturities of 365 days or less (including obligations or
securities of the Trustee if otherwise qualifying hereunder):
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or
any agency or instrumentality thereof, provided such obligations
are backed by the full faith and credit of the United States.
Such obligations must be limited to those instruments that have a
predetermined fixed dollar amount of principal due at maturity
that cannot vary or change. If rated, such an obligation should
not have an "r" highlighter affixed to its rating by
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Standard & Poor's. Interest may either by fixed or variable.
Interest should be tied to a single interest rate index plus a
single fixed spread (if any), and move proportionately with that
index. Such investments should not be relied upon for a fixed
yield;
(ii) repurchase obligations with respect to any security described in
clause (i) above (having original maturities of not more than 365
days), provided that the short-term deposit or debt obligations,
of the party agreeing to repurchase such obligations are rated in
the highest rating category of each of Fitch, if rated by Fitch,
Moody's and Standard & Poor's or such lower rating as will not
result in qualification, downgrading or withdrawal of the ratings
then assigned to the Certificates, as evidenced in writing by the
Rating Agencies. In addition, any such item should not have an
"r" highlighter affixed to its rating by Standard & Poor's, and
its terms should have a predetermined fixed dollar amount of
principal due at maturity that cannot very or change. Interest
may either by fixed or variable, and should be tied to a single
interest rate index plus a single fixed spread (if any), and move
proportionately with that index. Such investments should not be
relied upon for a fixed yield;
(iii) certificates of deposit, time deposits, demand deposits and
bankers' acceptances of any bank or trust company organized under
the laws of the United States or any state thereof (having
original maturities of not more than 365 days), the short term
obligations of which are rated in the highest rating category of
each of Fitch, if rated by Fitch, Moody's and Standard & Poor's
or such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to the
Certificates, as evidenced in writing by the Rating Agencies. In
addition, any such item should not have an "r" highlighter
affixed to its rating by Standard & Poor's, and its terms should
have a predetermined fixed dollar amount of principal due at
maturity that cannot very or change. Interest may either be fixed
or variable, and should be tied to a single interest rate index
plus a single fixed spread (if any), and move proportionately
with that index. Such investments should not be relied upon for a
fixed yield;
(iv) commercial paper (having original maturities of not more than 365
days) of any corporation incorporated under the laws of the
United States or any state thereof (or if not so incorporated,
the commercial paper is United States Dollar denominated and
amounts payable thereunder are not subject to any withholding
imposed by any non-United States jurisdiction) which is rated in
the highest rating category of each of Fitch, if rated by Fitch,
Moody's and Standard & Poor's or such lower rating as will not
result in qualification, downgrading or withdrawal of the ratings
then assigned to the Certificates, as evidenced in writing by the
Rating Agencies. The
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commercial paper should not have an "r" highlighter affixed to
its rating by Standard & Poor's and by its terms should have a
predetermined fixed dollar amount of principal due at maturity
that cannot very or change. Interest may either by fixed or
variable. Interest should be tied to a single interest rate index
plus a single fixed spread (if any), and move proportionately
with that index. Such investments should not be relied upon for a
fixed yield;
(v) units of money market funds rated in the highest rating category
of Fitch, if rated by Fitch, and Moody's and AAAm or AAAm-G by
Standard & Poor's (or such lower rating as will not result in
qualification, downgrading or withdrawal of the ratings then
assigned to the Certificates, as evidenced in writing by the
Rating Agencies) and which seek to maintain a constant net asset
value;
(vi) any other obligation or security acceptable to each Rating
Agency, evidence of which acceptability shall be provided in
writing by each Rating Agency to the Master Servicer, the Special
Servicer and the Trustee;
provided that (1) no investment described hereunder shall evidence either the
right to receive (x) only interest with respect to such investment or (y) a
yield to maturity greater than 120% of the yield to maturity at par of the
underlying obligations; and (2) that no investment described hereunder may be
purchased at a price greater than par if such investment may be prepaid or
called at a price less than its purchase price prior to stated maturity.
"Permitted Transferee": Any Transferee of a Residual Certificate other than
a Disqualified Organization or Non-United States Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Phase I Environmental Assessment": A "Phase I assessment" as described in
and meeting the criteria of Chapter 5 of the FNMA Multifamily Guide, as amended
from time to time.
"P&I Advance": As to any Mortgage Loan or REO Loan, any advance made by the
Master Servicer, the Trustee or the Fiscal Agent pursuant to Section 4.03(a) and
(b).
"P&I Advance Date": The Business Day immediately preceding each
Distribution Date.
"Plan": As defined in Section 5.02(c).
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"Plurality Residual Certificateholder": As to any taxable year of REMIC I,
REMIC II or REMIC III, the Holder of Certificates with the largest Percentage
Interest of the related Class of Residual Certificates.
"Prepayment Assumption": For purposes of determining the accrual of
original issue discount, market discount and premium, if any, on the
Certificates for federal income tax purposes, 0% CPR (within the meaning of the
Prospectus).
"Prepayment Interest Excess": With respect to any Mortgage Loan that was
subject to a Principal Prepayment in full or in part during any Collection
Period, which Principal Prepayment was applied to such Mortgage Loan following
such Mortgage Loan's Due Date in such Collection Period, the amount of interest
(net of the related Trustee Fee and Servicing Fee) accrued on the amount of such
Principal Prepayment during the period from and after such Due Date, to the
extent collected.
"Prepayment Interest Shortfall": With respect to any Mortgage Loan that was
subject to a Principal Prepayment in full or in part during any Collection
Period, which Principal Prepayment was applied to such Mortgage Loan prior to
such Mortgage Loan's Due Date in such Collection Period, the amount of interest,
to the extent not collected from the related Mortgagor, that would have accrued
at a rate per annum equal to the Net Mortgage Rate for such Mortgage Loan on the
amount of such Principal Prepayment during the period commencing on the date as
of which such Principal Prepayment was applied to such Mortgage Loan and ending
on the day immediately preceding such Due Date, inclusive.
"Prepayment Premium": Any Yield Maintenance Charge, Treasury Spread
Maintenance or Percentage Premium paid or payable, as the context requires, by a
Mortgagor in connection with a Principal Prepayment.
"Prime Rate": The "prime rate" published in the "Money Rates" section of
The Wall Street Journal, as such "prime rate" may change from time to time. If
The Wall Street Journal ceases to publish the "prime rate", then the Master
Servicer shall select an equivalent publication that publishes such "prime
rate"; and if such "prime rate" is no longer generally published or is limited,
regulated or administered by a governmental or quasi-governmental body, then the
Master Servicer shall select a comparable interest rate index. In either case,
such selection shall be made by the Master Servicer in its sole discretion and
the Master Servicer shall notify the Trustee, the Fiscal Agent and the Special
Servicer in writing of its selection.
"Principal Distribution Amount": With respect to any Distribution Date, the
aggregate of the following:
(a) the aggregate of the principal portions of all Scheduled Payments
(other than Balloon Payments) and any Assumed Scheduled Payments
in respect of the Mortgage Loans for their respective Due Dates
occurring during the related Collection Period;
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(b) the aggregate of all Principal Prepayments received on the
Mortgage Loans during the related Collection Period (including
any Remaining Cash Flow);
(c) with respect to any Mortgage Loan as to which the related Stated
Maturity Date occurred during or prior to the related Collection
Period, any payment of principal (exclusive of any amounts
described in clause (d) below) made by or on behalf of the
related Mortgagor during the related Collection Period (including
any Balloon Payment), net of any portion of such payment that
represents a recovery of the principal portion of any Scheduled
Payment (other than a Balloon Payment) due, or the principal
portion of any Assumed Scheduled Payment deemed due, in respect
of such Mortgage Loan on a Due Date during or prior to the
related Collection Period and not previously recovered;
(d) the aggregate of all Liquidation Proceeds and Insurance Proceeds
that were received on the Mortgage Loans during the related
Collection Period and that were identified and applied by the
Master Servicer as recoveries of principal of such Mortgage
Loans, in each case net of any portion of such amounts that
represents a recovery of the principal portion of any Scheduled
Payment (other than a Balloon Payment) due, or of the principal
portion of any Assumed Scheduled Payment deemed due, in respect
of the related Mortgage Loan on a Due Date during or prior to the
related Collection Period and not previously recovered;
(e) with respect to any REO Properties, the aggregate of the
principal portions of all Assumed Scheduled Payments in respect
of the related REO Loans for their respective Due Dates occurring
during the related Collection Period;
(f) with respect to any REO Properties, the aggregate of all
Liquidation Proceeds, Insurance Proceeds and REO Revenues that
were received during the related Collection Period on such REO
Properties and that were identified and applied by the Master
Servicer and/or Special Servicer as recoveries of principal of
the related REO Loans, in each case net of any portion of such
amounts that represents a recovery of the principal portion of
any Scheduled Payment (other than a Balloon Payment) due, or of
the principal portion of any Assumed Scheduled Payment deemed
due, in respect of the related REO Loan or the predecessor
Mortgage Loan on a Due Date during or prior to the related
Collection Period and not previously recovered; and
(g) if such Distribution Date is subsequent to the initial
Distribution Date, the excess, if any, of the Principal
Distribution Amount for the immediately preceding Distribution
Date, over the aggregate distributions of principal made on the
Certificates on such immediately preceding Distribution Date
pursuant to Section 4.01.
"Principal Prepayment": Any payment of principal made by the Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date; and
provided that it shall not
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include a payment of principal that is accompanied by an amount of interest
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment.
"Principal Recovery Fee": With respect to each Specially Serviced Mortgage
Loan, Corrected Mortgage Loan and REO Loan, the fee payable to the Special
Servicer out of certain related principal recoveries pursuant to the second
paragraph of Section 3.11(c).
"Prospectus": The prospectus dated June 5, 1997, as supplemented by the
Prospectus Supplement, relating to the Registered Certificates.
"Prospectus Supplement": The prospectus supplement dated June 20, 1997
relating to the Registered Certificates.
"Purchase Price": With respect to any Mortgage Loan to be purchased by a
Mortgage Loan Seller pursuant to the related Mortgage Loan Purchase Agreement,
by the Majority Subordinate Certificateholder pursuant to Section 3.18(b), by
the Master Servicer or the Special Servicer pursuant to Section 3.18(c) or by
the Depositor or the Master Servicer pursuant to Section 9.01 or to be otherwise
sold pursuant to Section 3.18(d), a cash price equal to the outstanding
principal balance of such Mortgage Loan as of the date of purchase, together
with (a) all accrued and unpaid interest on such Mortgage Loan at the related
Mortgage Rate to but not including the Due Date in the Collection Period of
purchase plus any accrued interest on P&I Advances, (b) all related and
unreimbursed Servicing Advances plus any accrued interest thereon, (c) any
reasonable costs and expenses incurred by the Trust Fund in connection with any
such purchase by a Mortgage Loan Seller and (d) any Additional Trust Fund
Expenses in respect of such Mortgage Loan (except that Additional Trust Fund
Expenses in respect of such Mortgage Loan allocable to any Class of Certificates
owned by the Majority Subordinate Certificateholder shall not be included in the
Purchase Price with respect to a purchase made by the Majority Subordinate
Certificateholder pursuant to Section 3.18(b)); provided that the Purchase Price
shall not be reduced by any outstanding P&I Advance.
"Qualified Insurer": An insurance company or security or bonding company
qualified to write the related Insurance Policy in the relevant jurisdiction.
"Rating Agency": Each of Fitch, Moody's and Standard & Poor's.
"Realized Loss": With respect to: (1) each Defaulted Mortgage Loan as to
which a Final Recovery Determination has been made, or with respect to any
successor REO Loan as to which a Final Recovery Determination has been made as
to the related REO Property, an amount (not less than zero) equal to (a) the
unpaid principal balance of such Mortgage Loan or REO Loan, as the case may be,
as of the commencement of the Collection Period in which the Final Recovery
Determination was made, plus (b) without taking into account the amount
described in subclause (1)(d) of this definition, all accrued but unpaid
interest on such Mortgage Loan or REO Loan, as the case may be, at the related
Mortgage Rate to but not including the Due Date in the Collection Period in
which the Final Recovery Determination was made, plus (c) any related
unreimbursed Servicing Advances as of the commencement of the Collection Period
in which the Final Recovery
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Determination was made, together with any new related Servicing Advances made
during such Collection Period, minus (d) all payments and proceeds, if any,
received in respect of such Mortgage Loan or REO Loan, as the case may be,
during the Collection Period in which such Final Recovery Determination was
made; (2) each Defaulted Mortgage Loan as to which any portion of the principal
payable thereunder was canceled in connection with a bankruptcy or similar
proceeding involving the related Mortgagor or a modification, waiver or
amendment of such Mortgage Loan granted or agreed to by the Special Servicer
pursuant to Section 3.20, the amount of such principal so canceled; and (3) each
Mortgage Loan as to which the Mortgage Rate thereon has been permanently reduced
and not recaptured for any period in connection with a bankruptcy or similar
proceeding involving the related Mortgagor or a modification, waiver or
amendment of such Mortgage Loan granted or agreed to by the Special Servicer
pursuant to Section 3.20, the amount of the consequent reduction in the interest
portion of each successive Monthly Payment due thereon. Each such Realized Loss
determined pursuant to clause (3) above shall be deemed to have been incurred on
the Due Date for each affected Monthly Payment.
"Record Date": With respect to any Distribution Date, the last Business Day
of the month immediately preceding the month in which such Distribution Date
occurs.
"Registered Certificate": Any Class A-1, Class A-2, Class A-3, Class B,
Class C, Class D, Class E or Class IO Certificate.
"Regular Certificate": Any REMIC III Certificate other than a Class R-III
Certificate.
"Reimbursement Rate": The rate per annum applicable to the accrual of
interest on Servicing Advances in accordance with Section 3.03(d) and on P&I
Advances in accordance with Section 4.03(d), which rate per annum is equal to
the Prime Rate.
"Remaining Cash Flow": With respect to a Hyperamortization Mortgage Loan,
all monthly cash flow generated by the related Mortgaged Property in excess of
(i) the Scheduled Payment for a particular Due Date and (ii) operating expenses
and certain other expenses set forth in the related Mortgage Note.
"REMIC": A "real estate mortgage investment conduit" as defined in Section
860D of the Code.
"REMIC I": The segregated pool of assets subject hereto, constituting the
primary trust created hereby and to be administered hereunder with respect to
which a separate REMIC election is to be made and, consisting of: (i) the
Mortgage Loans as from time to time are subject to this Agreement and all
payments under and proceeds of such Mortgage Loans received after the Closing
Date (excluding the Additional Interest and any other interest payable on the
Mortgage Loans which is attributable to any portion of the Servicing Fee or the
Special Servicing Fee that is deemed to be in excess of the amount which
constitutes reasonable servicing compensation within the meaning of the REMIC
Provisions), together with all documents included in the related Mortgage Files
and any Escrow Payments and Reserve Funds; (ii) any REO Property acquired in
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respect of a Mortgage Loan; (iii) such funds or assets as from time to time are
deposited in the Certificate Account, the Distribution Account and, if
established, the REO Account; and (iv) the rights of the Depositor under Section
3 of each of the Mortgage Loan Purchase Agreements.
"REMIC I Regular Interest": Any of the separate non-certificated beneficial
ownership interests in REMIC I issued hereunder and designated as a "regular
interest" in REMIC I, as described in the Preliminary Statement hereto.
"REMIC I Remittance Rate": With respect to any REMIC I Regular Interest,
the Net Mortgage Rate for the related Mortgage Loan (or any successor REO Loan)
to which such REMIC I Regular Interest relates.
"REMIC II": The segregated pool of assets consisting of all of the REMIC I
Regular Interests conveyed in trust to the Trustee for the benefit of REMIC III,
as holder of the REMIC II Regular Interests, and the Holders of the Class R-II
Certificates pursuant to Section 2.06, with respect to which a separate REMIC
election is to be made.
"REMIC II Regular Interest": Any of the 12 separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
"regular interest" in REMIC II. Each REMIC II Regular Interest shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and (except with respect to the REMIC II Class IO Regular Interest) shall be
entitled to distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated Principal
Balance as set forth in the Preliminary Statement hereto. The designations for
the respective REMIC II Regular Interests are set forth in the Preliminary
Statement hereto.
"REMIC II Remittance Rate": With respect to each Class of the REMIC II
Regular Interests for any Distribution Date, the REMIC II Remittance Rate with
respect to such Class for such Distribution Date as set forth in the Preliminary
Statement hereto.
"REMIC III": The segregated pool of assets consisting of all of the REMIC
II Regular Interests conveyed in trust to the Trustee for the benefit of the
Holders of the REMIC III Certificates pursuant to Section 2.08, with respect to
which a separate REMIC election is to be made.
"REMIC III Certificate": Any Class A-1, Class A-2, Class A-3, Class B,
Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class IO or Class
R-III Certificate.
"REMIC Administrator": The Trustee or any REMIC administrator appointed
pursuant to Section 8.14.
"REMIC Provisions": Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Sections 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
proposed, temporary and final Treasury regulations and any published rulings,
notices and announcements promulgated thereunder, as the foregoing may be in
effect from time to time.
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"Rents from Real Property": With respect to any REO Property, gross income
of the character described in Section 856(d) of the Code.
"REO Account": A segregated account or accounts created and maintained by
the Special Servicer pursuant to Section 3.16 on behalf of the Trustee in trust
for the Certificateholders, which shall be entitled "GE Capital Realty Group,
Inc., as Special Servicer, in trust for registered holders of Merrill Lynch
Mortgage Investors, Inc., Mortgage Pass-Through Certificates, Series 1997-C1".
"REO Acquisition": The acquisition of any REO Property pursuant to Section
3.09.
"REO Disposition": The sale or other disposition of any REO Property
pursuant to Section 3.18(d).
"REO Extension": As defined in Section 3.16(a).
"REO Loan": The mortgage loan deemed for purposes hereof to be outstanding
with respect to each REO Property. Each REO Loan shall be deemed to provide for
monthly payments of principal and/or interest equal to its Assumed Scheduled
Payment and otherwise to have the same terms and conditions as its predecessor
Mortgage Loan (such terms and conditions to be applied without regard to the
default on such predecessor Mortgage Loan). Each REO Loan shall be deemed to
have an initial unpaid principal balance and Stated Principal Balance equal to
the unpaid principal balance and Stated Principal Balance, respectively, of its
predecessor Mortgage Loan as of the date of the related REO Acquisition. All
Scheduled Payments (other than a Balloon Payment), Assumed Scheduled Payments
(in the case of a Balloon Mortgage Loan delinquent in respect of its Balloon
Payment) and other amounts due and owing, or deemed to be due and owing, in
respect of the predecessor Mortgage Loan as of the date of the related REO
Acquisition, shall be deemed to continue to be due and owing in respect of an
REO Loan. Collections in respect of each REO Loan (after provision for amounts
to be applied to the payment of, or to be reimbursed to the Master Servicer or
the Special Servicer for the payment of, the costs of operating, managing and
maintaining the related REO Property) shall be treated: first, as a recovery of
accrued and unpaid interest on such REO Loan at the related Mortgage Rate to but
not including the Due Date in the Collection Period of receipt; second, as a
recovery of principal of such REO Loan to the extent of its entire unpaid
principal balance; and third, in accordance with the normal servicing practices
of the Master Servicer, as a recovery of any other amounts due and owing in
respect of such REO Loan. Notwithstanding the foregoing, all amounts payable or
reimbursable to the Master Servicer, the Special Servicer, the Trustee or the
Fiscal Agent in respect of the predecessor Mortgage Loan as of the date of the
related REO Acquisition, including, without limitation, any unpaid Servicing
Fees and Special Servicing Fees and any unreimbursed Servicing Advances and P&I
Advances, together with any interest accrued and payable to the Master Servicer,
the Special Servicer, the Trustee or the Fiscal Agent in respect of such
Servicing Advances and P&I Advances in accordance with Sections 3.03(d) and
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4.03(d), shall continue to be payable or reimbursable to the Master Servicer,
the Special Servicer, the Trustee or the Fiscal Agent, as the case may be, in
respect of an REO Loan pursuant to Section 3.05(a).
"REO Property": A Mortgaged Property acquired on behalf and in the name of
the Trustee for the benefit of the Certificateholders through foreclosure,
acceptance of a deed-in-lieu of foreclosure or otherwise in accordance with
applicable law in connection with the default or imminent default of a Mortgage
Loan.
"REO Revenues": All income, rents, profits and proceeds derived from the
ownership, operation or leasing of any REO Property.
"REO Tax": As defined in Section 3.17(a).
"Request for Release": A request signed by a Servicing Officer, as
applicable, of the Master Servicer in the form of Exhibit D-1 attached hereto or
of the Special Servicer in the form of Exhibit D-2 attached hereto.
"Required Appraisal": With respect to each Required Appraisal Mortgage
Loan, an Independent appraisal of the related Mortgaged Property prepared in
accordance with 12 CFR ss.225.62 and conducted in accordance with the standards
of the Appraisal Institute from an Independent Appraiser selected by the Special
Servicer.
"Required Appraisal Mortgage Loan": Each Mortgage Loan that (i) is sixty
(60) days or more delinquent in respect of any Monthly Payments, (ii) becomes an
REO Loan or (iii) has been modified by the Special Servicer to reduce the amount
of any Monthly Payment (other than a Balloon Payment).
"Required Appraisal Value": An amount equal to 90% of the Appraised Value
(net of any prior liens and estimated liquidation expenses) of the Mortgaged
Property related to the subject Required Appraisal Mortgage Loan as determined
by a Required Appraisal or any letter update of such Required Appraisal; and
provided further that for purposes of determining any Appraisal Reduction Amount
in respect of such Required Appraisal Mortgage Loan, such Appraisal Reduction
Amount shall be amended annually to reflect the Required Appraisal Value
determined pursuant to any Required Appraisal or letter update of a Required
Appraisal conducted subsequent to the original Required Appraisal performed
pursuant to Section 3.09(a).
"Reserve Account": The account or accounts created and maintained pursuant
to Section 3.03(f).
"Reserve Funds": With respect to any Mortgage Loan, any amounts delivered
by the related Mortgagor to be held in escrow by or on behalf of the mortgagee
representing reserves for repairs and/or capital improvements to the related
Mortgaged Property.
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"Residual Certificate": A Class R-I, Class R-II or Class R-III Certificate.
"Responsible Officer": When used with respect to (i) the initial Trustee or
the initial Fiscal Agent, any officer or assistant officer in the Asset Backed
Securities Trust Services Group of the initial Trustee and (ii) any successor
Trustee or Fiscal Agent, any officer or assistant officer in the Corporate Trust
Department of the Trustee or Fiscal Agent, respectively, or any other officer or
assistant officer of the Trustee or Fiscal Agent customarily performing
functions similar to those performed by any of the above designated officers to
whom a particular matter is referred by the Trustee or Fiscal Agent because of
such officer's knowledge of and familiarity with the particular subject.
"Revised Rate": With respect to the Hyperamortization Mortgage Loans, the
increased interest rate after the Expected Repayment Date (in the absence of a
default) for each such Hyperamortization Mortgage Loan, as calculated and as set
forth in the related Mortgage Note.
"Scheduled Payment": With respect to any Mortgage Loan, for any Due Date
following the Cut-off Date as of which it is outstanding, the scheduled monthly
payment of principal and interest on such Mortgage Loan that is or would be, as
the case may be, payable by the related Mortgagor on such Due Date under the
terms of the related Mortgage Note as in effect on the Closing Date, but without
regard to (i) any subsequent change in or modification of such terms in
connection with a bankruptcy or similar proceeding involving the related
Mortgagor or a modification, waiver or amendment of such Mortgage Loan granted
or agreed to by the Special Servicer pursuant to Section 3.20, or (ii) the
application of any Remaining Cash Flow with respect to a Hyperamortization Loan,
and assuming that each prior Scheduled Payment has been made in a timely manner.
"Securities Act": The Securities Act of 1933, as amended.
"Senior Certificate": Any Class A-1, Class A-2, Class A-3 or Class IO
Certificate.
"Servicing Account": The account or accounts created and maintained
pursuant to Section 3.03(a).
"Servicing Advances": All customary, reasonable and necessary "out of
pocket" costs and expenses incurred by or on behalf of the Master Servicer or
Special Servicer (to the extent not reimbursed by the Master Servicer) in
connection with the servicing of a Mortgage Loan, or in connection with the
administration of any REO Property, including, but not limited to, the cost of
(a) compliance with the obligations of the Master Servicer and the Special
Servicer, if any, set forth in Section 3.03(c), (b) the preservation, insurance,
restoration, protection and management of a Mortgaged Property, including the
cost of any "forced placed" insurance policy purchased by the Master Servicer to
the extent such cost is allocable to a particular Mortgaged Property that the
Master Servicer or the Special Servicer is required to cause to be insured
pursuant to Section 3.07(a), (c) obtaining any Insurance
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Proceeds or any Liquidation Proceeds of the nature described in clauses (i)-(v)
of the definition of "Liquidation Proceeds," (d) any enforcement or judicial
proceedings with respect to a Mortgaged Property, including, without limitation,
foreclosures, (e) any Required Appraisal or other appraisal and (f) the
operation, management, maintenance and liquidation of any REO Property,
including, without limitation, appraisals. Notwithstanding anything to the
contrary, "Servicing Advances" shall not include allocable overhead of the
Master Servicer or the Special Servicer, which shall include costs for office
space, office equipment, supplies and related expenses, employee salaries and
related expenses and similar internal costs and expenses.
"Servicing Fee": With respect to each Mortgage Loan and REO Loan, the fee
payable to the Master Servicer pursuant to Section 3.11(a).
"Servicing Fee Increase": With respect to each Mortgage Loan that continues
to be serviced pursuant to the terms of this Agreement, an amount computed on
the same basis as the Servicing Fee, but at a per annum rate equal to the
difference between the Successor Servicing Fee Rate and the Initial Servicing
Fee Rate.
"Servicing Fee Rate": For so long as GECAM is the initial Master Servicer
hereunder, the Initial Servicing Fee Rate, and upon the resignation, termination
or removal of GECAM as initial Master Servicer hereunder, the Successor
Servicing Fee Rate.
"Servicing File": Any documents (other than documents required to be part
of the related Mortgage File) in the possession of the Depositor and relating to
the origination and servicing of any Mortgage Loan, including appraisals,
surveys, engineering reports and environmental reports.
"Servicing Officer": Any officer or employee of the Master Servicer or the
Special Servicer involved in, or responsible for, the administration and
servicing of the Mortgage Loans, whose name and specimen signature appear on a
list of servicing officers furnished by such party to the Trustee and the
Depositor on the Closing Date, as such list may be amended from time to time.
"Servicing Standard": With respect to the Master Servicer or the Special
Servicer, to service and administer the Mortgage Loans in the same manner in
which, and with the same care, skill, prudence and diligence with which, the
Master Servicer or the Special Servicer, as the case may be, generally services
and administers similar mortgage loans (a) (i) for other third-party portfolios
of a similar nature with similar borrowers, giving due consideration to
customary and usual standards of practice of prudent institutional commercial
mortgage lenders servicing their own loans or (ii) held in its own portfolio,
whichever standard is higher and (b) with a view to the maximization of the
recovery on such Mortgage Loan on a net present value basis, notwithstanding (i)
any relationship that the Master Servicer or the Special Servicer, as the case
may be, or any Affiliate thereof may have with the related Mortgagor, the
Depositor or any other party to the transaction; (ii) the ownership of any
Certificate by the Master Servicer or the Special Servicer, as the case may
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be, or by any Affiliate thereof; (iii) the right of the Master Servicer or the
Special Servicer, as the case may be, to receive compensation or other fees for
its services rendered pursuant to this Agreement; (iv) the obligations of the
Master Servicer or the Special Servicer, as the case may be, to make Advances;
(v) the ownership, servicing or management for others of any other mortgage
loans or mortgaged property; and (vi) any obligation of the Master Servicer or
Special Servicer as a Mortgage Loan Seller or as an Affiliate thereof, to pay
any indemnity with respect to or repurchase any Mortgage Loan.
"Servicing Transfer Event": With respect to any Mortgage Loan, the
occurrence of any of the events described in clauses (a) through (h) of the
definition of "Specially Serviced Mortgage Loan".
"Single Certificate": For purposes of Section 4.02, a hypothetical
Certificate of any Class of Regular Certificates evidencing a $1,000
denomination.
"Special Servicer": GE Capital Realty Group, Inc., its successor in
interest, or any successor special servicer appointed as herein provided.
"Special Servicing Fee": With respect to each Specially Serviced Mortgage
Loan and each REO Loan, the fee designated as such and payable to the Special
Servicer pursuant to the first paragraph of Section 3.11(c).
"Special Servicing Fee Rate": With respect to each Specially Serviced
Mortgage Loan and each REO Loan, 0.25% per annum.
"Specially Serviced Mortgage Loan": Any Mortgage Loan as to which any of
the following events have occurred:
(a) the related Mortgagor shall have failed to make any Monthly
Payment, which failure continues unremedied for 45 days (or, in
the case of a Balloon Payment, if the Master Servicer receives
written evidence from an institutional lender of such lender's
commitment to refinance such Mortgage Loan and the related
Mortgagor continues to make monthly payments of principal and
interest in an amount at least equal to the Monthly Payment due
on the Due Date immediately preceding the scheduled maturity
date, such longer period (not to exceed 120 days) within which
such refinancing will occur); or
(b) the Master Servicer shall have determined, in its good faith
reasonable judgment, based on communications with the related
Mortgagor, that a default in making a Monthly Payment is likely
to occur within 30 days and is likely to remain unremedied for at
least 60 days (or, in the case of a Balloon Payment, if the
Master Servicer has received written evidence from an
institutional lender of such lender's commitment to refinance
such Mortgage Loan and if the Master Servicer reasonably expects
the
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related Mortgagor to continue to make monthly payments of
principal and interest in an amount at least equal to the Monthly
Payment due on the Due Date immediately preceding the scheduled
maturity date, such longer period (not to exceed 120 days) within
which such refinancing will occur); or
(c) there shall have occurred a default (other than as described in
clauses (a) above or (h) below) under the related Mortgage Loan
documents that in the good faith reasonable judgment of the
Master Servicer materially impairs the value of the Mortgaged
Property as security for the Mortgage Loan or otherwise
materially adversely affects the interests of Certificateholders
and that continues unremedied for the applicable grace period
under the terms of the Mortgage Loan (or, if no grace period is
specified, for 30 days); or
(d) a decree or order of a court or agency or supervisory authority
having jurisdiction in the premises in an involuntary case under
any present or future federal or state bankruptcy, insolvency or
similar law or the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered
against the related Mortgagor and such decree or order shall have
remained in force undischarged or unstayed for a period of 60
days; or
(e) the related Mortgagor shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities or
similar proceedings of or relating to such Mortgagor or of or
relating to all or substantially all of its property; or
(f) the related Mortgagor shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take
advantage of any applicable insolvency or reorganization statute,
make an assignment for the benefit of its creditors, or
voluntarily suspend payment of its obligations;
(g) the Master Servicer shall have received notice of the
commencement of foreclosure or similar proceedings with respect
to the related Mortgaged Property; or
(h) there shall have occurred a default with respect to payment of
insurance premiums or property taxes, including making escrow
payments for the payment of real estate taxes and insurance
premiums with respect to such Mortgage Loan that in the good
faith reasonable judgment of the Master
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Servicer materially impairs (without regard to any Servicing
Advance) the value of the Mortgaged Property as security for the
Mortgage Loan or otherwise materially adversely affects the
interests of Certificateholders and that continues unremedied for
the applicable grace period under the terms of the Mortgage Loan
(or, if no grace period is specified, for the lesser of 30 days
or ten (10) days prior to the date the insurance becomes
cancelable or the taxes become delinquent) with respect to
payment of insurance premiums or property taxes (except to the
extent that the related Mortgagor is contesting the payment of
such taxes in accordance with the terms of the Mortgage Loan);
provided, however, that a Mortgage Loan will cease to be a Specially Serviced
Mortgage Loan:
(w) with respect to the circumstances described in clause (a) above,
when the related Mortgagor has made three consecutive full and
timely Monthly Payments under the terms of such Mortgage Loan (as
such terms may be changed or modified in connection with a
bankruptcy or similar proceeding involving the related Mortgagor
or by reason of a modification, waiver or amendment granted or
agreed to by the Special Servicer pursuant to Section 3.20);
(x) with respect to the circumstances described in clauses (b), (d),
(e) and (f) above, when such circumstances cease to exist in the
good faith reasonable judgment of the Special Servicer, but, with
respect to any bankruptcy or insolvency proceedings described in
clauses (d), (e) and (f), no later than the entry of an order or
decree dismissing such proceeding;
(y) with respect to the circumstances described in clauses (c) or (h)
above, when such default is cured; and
(z) with respect to the circumstances described in clause (g) above,
when such proceedings are terminated;
so long as at that time no circumstance identified in clauses (a) through (h)
above exists that would cause the Mortgage Loan to continue to be characterized
as a Specially Serviced Mortgage Loan.
"Standard & Poor's": Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., or its successor in interest. If neither such
rating agency nor any successor remains in existence, "Standard & Poor's" shall
be deemed to refer to such other nationally recognized statistical rating agency
or other comparable Person designated by the Depositor, notice of which
designation shall be given to the Trustee, the Fiscal Agent, the Master Servicer
and the Special Servicer, and specific ratings of Standard & Poor's Ratings
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Services herein referenced shall be deemed to refer to the equivalent ratings of
the party so designated.
"Startup Day": With respect to each of REMIC I, REMIC II and REMIC III, the
day designated as such in Section 10.01(c).
"State and Local Taxes": Taxes imposed by the states of New York, Illinois,
Delaware and Texas and by any other state or local taxing authorities as may, by
notice to the Trustee, assert jurisdiction over the trust fund or any portion
thereof, or which, according to an Opinion of Counsel addressed to the Trustee,
have such jurisdiction.
"Stated Maturity Date": With respect to any Mortgage Loan, the Due Date
specified in the Mortgage Note (as in effect on the Closing Date) on which the
last payment of principal is due and payable under the terms of the Mortgage
Note (as in effect on the Closing Date), without regard to any change in or
modification of such terms in connection with a bankruptcy or similar proceeding
involving the related Mortgagor or a modification, waiver or amendment of such
Mortgage Loan granted or agreed to by the Special Servicer pursuant to Section
3.20.
"Stated Principal Balance": With respect to any Mortgage Loan (and any
successor REO Loan), the Cut-off Date Balance of such Mortgage Loan, as reduced
on each Distribution Date (to not less than zero) by (i) all payments (or
advances in lieu thereof) and other collections of principal of such Mortgage
Loan (or successor REO Loan) that are due or received, as the case may be,
during the related Collection Period and distributed to Certificateholders on
such Distribution Date, and (ii) the principal portion of any Realized Loss
incurred in respect of such Mortgage Loan (or successor or REO Loan) during the
related Collection Period for such Distribution Date. Notwithstanding the
foregoing, if a Liquidation Event occurs in respect of any Mortgage Loan or REO
Property, then the "Stated Principal Balance" of such Mortgage Loan or of the
related REO Loan, as the case may be, shall be zero commencing as of the
Distribution Date in the Collection Period next following the Collection Period
in which such Liquidation Event occurred.
"Subordinated Certificate": Any Class B, Class C, Class D, Class E, Class
F, Class G, Class H, Class J, Class R-I, Class R-II or Class R-III Certificate.
"Sub-Servicer": Any Person with which the Master Servicer or the Special
Servicer has entered into a Sub-Servicing Agreement.
"Sub-Servicing Agreement": The written contract between the Master Servicer
or the Special Servicer, on the one hand, and any Sub-Servicer, on the other
hand, relating to servicing and administration of Mortgage Loans as provided in
Section 3.22.
"Successor Servicing Fee Rate": The lesser of (a) the Imputed Servicing Fee
Rate and (b) the rate at which the Trustee or a successor Master Servicer
appointed pursuant to Section 7.02 hereof agrees to service the Mortgage Loans.
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"Tax Matters Person": With respect to each of the REMICs created hereunder,
the Person designated as the "tax matters person" of such REMIC in the manner
provided under Treasury regulation section 1.860F-4(d) and temporary Treasury
regulation section 301.6231(a)(7)-1T, which Person shall be the applicable
Plurality Residual Certificateholder.
"Tax Returns": The federal income tax return on Internal Revenue Service
Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return,
including Schedule Q thereto, Quarterly Notice to Residual Interest Holders of
REMIC Taxable Income or Net Loss Allocation, or any successor forms, to be filed
on behalf of each of REMIC I, REMIC II and REMIC III due to its classification
as a REMIC under the REMIC Provisions, together with any and all other
information, reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service under any
applicable provisions of federal tax law or any other governmental taxing
authority under applicable State and Local Tax laws.
"Transaction Screen Process": An environmental assessment conducted in
accordance with the Standard Practice for Environmental Site Assessments:
Transaction Screen Process E 1528-93 (American Society for Testing and Materials
1993).
"Transfer": Any direct or indirect transfer, sale, pledge, hypothecation,
or other form of assignment of any Ownership Interest in a Certificate.
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer any Ownership
Interest in a Certificate.
"Treasury Spread Maintenance": Payments paid or payable, as the context
requires, on a Mortgage Loan as the result of a Principal Prepayment thereon,
not otherwise due thereon in respect of principal or interest, which have been
calculated (based on Scheduled Payments on such Mortgage Loan) based on the
aggregate payment of interest which would have accrued on such Mortgage Loan on
each subsequent Due Date through the maturity date of such Mortgage Loan, at a
rate calculated as the difference between the U.S. treasury note upon which the
related Mortgage Rate is based and the applicable U.S. treasury rate in effect
on the date of Principal Prepayment thereof, discounted at a rate set forth in
the related Mortgage Note at or near the time of prepayment.
"Trust Fund": Collectively, all of the assets of REMIC I, REMIC II and
REMIC III.
"Trustee": LaSalle National Bank, its successor in interest, or any
successor trustee appointed as herein provided.
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"Trustee Fee Rate": .005% per annum.
"Trustee Liability": As defined in Section 8.05(b).
"Trustee's Fee": The fee designated as such and payable to the Trustee
pursuant to Section 8.05.
"UCC": The Uniform Commercial Code in effect in the applicable
jurisdiction.
"UCC Financing Statement": A financing statement executed and filed
pursuant to the Uniform Commercial Code, as in effect in any relevant
jurisdiction.
"Uncertificated Accrued Interest": With respect to any REMIC I Regular
Interest, for any Distribution Date, one month's interest at the REMIC I
Remittance Rate applicable to such REMIC I Regular Interest for such
Distribution Date, accrued on the Uncertificated Principal Balance of such REMIC
I Regular Interest outstanding immediately prior to such Distribution Date and,
to the extent permitted under applicable law, also on any Uncertificated Accrued
Interest in respect of such REMIC I Regular Interest from prior Distribution
Dates that was not previously deemed paid. With respect to any REMIC II Regular
Interest, for any Distribution Date, one month's interest at the related REMIC
II Remittance Rate, accrued on the Uncertificated Principal Balance of such
REMIC II Regular Interest (or, in the case of the REMIC II Class IO Regular
Interest, the Notional Principal Amount thereof as set forth in the Preliminary
Statement hereto) outstanding immediately prior to such Distribution Date.
Uncertificated Accrued Interest in respect of any REMIC I Regular Interest or
any REMIC II Regular Interest shall accrue on the basis of a 360-day year
consisting of twelve 30-day months.
"Uncertificated Distributable Interest": With respect to any REMIC I
Regular Interest for any Distribution Date, the Uncertificated Accrued Interest
in respect of such REMIC I Regular Interest for such Distribution Date, reduced
(to not less than zero) by the product of (i) any Net Aggregate Prepayment
Interest Shortfall for such Distribution Date, multiplied by (ii) a fraction,
the numerator of which is the Uncertificated Accrued Interest in respect of such
REMIC I Regular Interest for such Distribution Date, and the denominator of
which is the aggregate Uncertificated Accrued Interest in respect of all the
REMIC I Regular Interest for such Distribution Date. With respect to any REMIC
II Regular Interest for any Distribution Date, the Uncertificated Accrued
Interest in respect of such REMIC II Regular Interest for such Distribution
Date, reduced (to not less than zero) by the product of (i) any Net Aggregate
Prepayment Interest Shortfall for such Distribution Date, multiplied by (ii) a
fraction, expressed as a percentage, the numerator of which is the
Uncertificated Accrued Interest in respect of such REMIC II Regular Interest for
such Distribution Date, and the denominator of which is the aggregate
Uncertificated Accrued Interest in respect of all the REMIC II Regular Interests
for such Distribution Date.
"Uncertificated Principal Balance": The principal amount of any REMIC I
Regular Interest or REMIC II Regular Interest (other than the REMIC II Class IO
Regular
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Interest) outstanding as of any date of determination. As of the Closing Date,
the Uncertificated Principal Balance of each REMIC I Regular Interest shall
equal the Cut-off Date Balance of the related Mortgage Loan and the
Uncertificated Principal Balance of each REMIC II Regular Interest (or, in the
case of the REMIC II Class IO Regular Interest, the Notional Principal Amount
thereof) shall equal the amount set forth in the Preliminary Statement hereto.
On each Distribution Date, the Uncertificated Principal Balance of each REMIC II
Regular Interest other than the Class IO Regular Interest shall be reduced by
all distributions of principal deemed to have been made thereon on such
Distribution Date pursuant to Section 4.01(i), and shall be further reduced on
such Distribution Date by all Realized Losses and Additional Trust Fund Expenses
deemed to have been allocated thereto on such Distribution Date pursuant to
Section 4.04(b). On each Distribution Date, the Uncertificated Principal Balance
of each REMIC I Regular Interest shall be reduced by all distributions of
principal deemed to have been made in respect of such REMIC I Regular Interest
on such Distribution Date pursuant to Section 4.01(j), and shall be further
reduced on such Distribution Date by the amount of any Realized Losses with
respect to the related Mortgage Loan.
"Underwriter": Each of Merrill Lynch and Daiwa.
"United States Person": A citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, an estate whose
income from sources without the United States is includible in gross income for
United States federal income tax purposes regardless of its connection with the
conduct of a trade or business within the United States, or a trust if a court
within the U.S. is able to exercise primary supervision over the administration
of the trust and one or more U.S. fiduciaries have the authority to control all
substantial decisions of the trust.
"Updated Mortgage Loan Schedule": The monthly loan schedule to be prepared
by the Master Servicer and delivered to the Trustee and the Depositor pursuant
to Section 3.12(c), which monthly loan schedule shall be substantially in the
form of Exhibit E-2.
"USAP": The Uniform Single Audit Program for Mortgage Bankers.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. At all times during the term
of this Agreement, 100% of the Voting Rights shall be allocated among the
Holders of the Class A-1, Class A-2, Class A-3, Class B, Class C, Class D, Class
E, Class F, Class G, Class H and Class J Certificates in proportion to the
respective Class Principal Balances of their Certificates. Voting Rights
allocated to a Class of Certificateholders shall be allocated among such
Certificateholders in proportion to the Percentage Interests evidenced by their
respective Certificates. In addition, if either the Master Servicer or the
Special Servicer is the holder of any Certificate, neither of the Master
Servicer or Special Servicer, in its capacity as a Certificateholder, shall have
Voting Rights with respect to matters concerning compensation affecting the
Master Servicer or the Special Servicer.
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"Weighted Average Effective REMIC I Remittance Rate": With respect to any
Distribution Date, the rate per annum equal to the weighted average, expressed
as a percentage and rounded to six decimal places, of the respective REMIC I
Remittance Rates in respect of the REMIC I Regular Interests for such
Distribution Date, weighted on the basis of the respective Uncertificated
Principal Balances of such REMIC I Regular Interests outstanding immediately
prior to such Distribution Date.
"Yield Maintenance Charge": Payments paid or payable, as the context
requires, on a Mortgage Loan as the result of a Principal Prepayment thereon,
not otherwise due thereon in respect of principal or interest, which have been
calculated (based on Scheduled Payments on such Mortgage Loan) to compensate the
holder for reinvestment losses based on the aggregate payment of interest which
would have accrued on such Mortgage Loan on each subsequent Due Date through the
maturity date of such Mortgage Loan, at a rate calculated as the difference
between the Mortgage Rate on such Mortgage Loan and the applicable U.S. treasury
rate in effect on the date of Principal Prepayment thereof, discounted at a rate
set forth in the related Mortgage Note at or near the time of prepayment. Any
other prepayment premiums, penalties and fees not so calculated will not be
considered "Yield Maintenance Charges."
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES; ORIGINAL
ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery hereof,
does hereby assign, sell, transfer, set over and otherwise convey to the
Trustee, without recourse, for the benefit of the Certificateholders (and for
the benefit of the other parties to this Agreement and Gemstone Acquisition
Corporation or its assignee as their respective interests may appear) all the
right, title and interest of the Depositor, in, to and under (i) the Mortgage
Loans, (ii) Sections 3 and 9-16 of each of the Mortgage Loan Purchase Agreements
and (iii) all other assets included or to be included in REMIC I. Such
assignment includes all interest and principal received or receivable on or with
respect to the Mortgage Loans and due after the Cut-off Date. The transfer of
the Mortgage Loans and the related rights and property accomplished hereby is
absolute and, notwithstanding Section 11.07, is intended by the parties to
constitute a sale.
(b) In connection with the Depositor's assignment pursuant to Section
2.01(a) above, the Depositor shall direct, and hereby represents and warrants
that it has directed, the Mortgage Loan Sellers pursuant to the applicable
Mortgage Loan Purchase Agreement to deliver to and deposit with, or cause to be
delivered to and deposited with, the Trustee or a Custodian appointed thereby
(with a copy to the Master Servicer), on or before the Closing Date, the
Mortgage File for each Mortgage Loan so assigned. None of the Trustee, any
Custodian, the Master Servicer or the Special Servicer shall be liable for any
failure by any Mortgage Loan Seller or the Depositor to comply with the document
delivery requirements of the respective Mortgage Loan Purchase Agreement and
this Section 2.01 (b).
(c) The Trustee shall, at the Depositor's expense and direction, as to each
Mortgage Loan, promptly (and in any event within 30 days following the Closing
Date) cause to be submitted for recording or filing, as the case may be, in the
appropriate public office for real property records or UCC Financing Statements,
as appropriate and to the extent delivered to the Custodian, each assignment of
Mortgage, assignment of Assignment of Leases and any other recordable documents
relating to the Mortgage Loan, in favor of the Trustee referred to in clauses
(iv) and (v) of the definition of "Mortgage File" and each UCC-2 and UCC-3
assignment in favor of the Trustee and delivered to the Custodian and referred
to in clause (viii) of the definition of "Mortgage File." Each such assignment
shall reflect that it should be returned by the public recording office to the
Custodian following recording, and each such UCC-2 and UCC-3 assignment shall
reflect that the file copy thereof should be returned to the Custodian following
filing; provided that in those instances where the public recording office
retains the original assignment of Mortgage or assignment of Assignment of
Leases the Custodian shall obtain therefrom a certified copy of the recorded
original. If any such document or instrument is lost or returned unrecorded or
unfiled, as the case may be, because of a defect therein, the Trustee shall
direct the appropriate Mortgage Loan Seller pursuant to the applicable Mortgage
Loan Purchase Agreement promptly to prepare or cause to be
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prepared a substitute therefor or cure such defect, as the case may be, and
thereafter the Trustee shall upon receipt thereof cause the same to be duly
recorded or filed, as appropriate.
(d) All documents and records in the possession of the Depositor or the
Mortgage Loan Sellers that relate to the Mortgage Loans and that are not
required to be a part of a Mortgage File in accordance with the definition
thereof shall be delivered to the Master Servicer (at the expense of the
Depositor or the applicable Mortgage Loan Seller) on or before the Closing Date
and shall be held by the Master Servicer on behalf of the Trustee in trust for
the benefit of the Certificateholders.
(e) In connection with the Depositor's assignment pursuant to Section
2.01(a) above, the Depositor shall deliver to the Custodian and the Master
Servicer on or before the Closing Date a copy of a fully executed counterpart of
each Mortgage Loan Purchase Agreement, as in full force and effect on the
Closing Date.
SECTION 2.02. Acceptance of REMIC I by Trustee.
(a) The Trustee, by its execution and delivery of this Agreement,
acknowledges receipt of the Depositor's assignment to it of its right, title and
interest in the assets that constitute REMIC I, and further acknowledges receipt
by it or a Custodian on its behalf, subject to the proviso in the definition of
"Mortgage File" and the provisions of Section 2.01 and subject to the further
review provided for in Section 2.02(b), of (i) the Mortgage File delivered to it
for each Mortgage Loan and (ii) a copy of a fully executed counterpart of each
Mortgage Loan Purchase Agreement, all in good faith and without notice of any
adverse claim, and declares that it or a Custodian on its behalf holds and will
hold such documents and the other documents received by it that constitute
portions of the Mortgage Files, and that it holds and will hold the Mortgage
Loans and other assets included in REMIC I, in trust for the exclusive use and
benefit of all present and future Certificateholders. The Custodian hereby
certifies to each of the Depositor, the Master Servicer, the Special Servicer
and the Mortgage Loan Sellers, that except as identified in a written notice, a
copy of which shall have been delivered by the Custodian on or prior to the
Closing Date to each of the Depositor, the Master Servicer, the Special Servicer
and the Mortgage Loan Sellers, without regard to the proviso in the definition
of "Mortgage File"; each of the documents specified in clause (i) of the
definition of Mortgage File are in its possession. In addition, within thirty
(30) Business Days after the Closing, the Trustee or the Custodian on its behalf
will review the Mortgage Files and certify to each of the Depositor, the Master
Servicer, the Special Servicer and the Mortgage Loan Sellers that, except as
specifically identified in the Schedule of Exceptions to Mortgage File Delivery
in substantially the form annexed hereto as Exhibit C, (i) without regard to the
proviso in the definition of "Mortgage File", all documents specified in clauses
(i) through (v) and (vii), and to the extent provided in the related Mortgage
File, clause (vi) of the definition of "Mortgage File" are in its possession,
(ii) all documents delivered or caused to be delivered by the Mortgage Loan
Sellers constituting the related Mortgage File have been reviewed by it and
appear regular on their face and relate to such Mortgage Loan, and (iii) based
on such examination and only as to the foregoing documents, the information set
forth in the Mortgage Loan Schedule with respect to the items specified in
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clauses (ii), (v) and (vi)(B) of the definition of "Mortgage Loan Schedule" is
correct. Notwithstanding the above, the Custodian may deliver a revised Schedule
of Exceptions to Mortgage File Delivery to the Depositor within 30 days after
the Closing Date. Such revised schedule shall be treated as if it was attached
hereto as Exhibit C.
(b) Within 90 days after the Closing Date, the Custodian shall certify in
writing to each of the Depositor, the Master Servicer, the Special Servicer and
each Mortgage Loan Seller that, as to each Mortgage Loan listed on the Mortgage
Loan Schedule (other than any Mortgage Loan as to which a Liquidation Event has
occurred or any Mortgage Loan specifically identified in any exception report
annexed thereto as not being covered by such certification): (i) all documents
specified in clauses (i), (ii), (iv) and (vii) and, to the extent provided in
the related Mortgage File, clauses (iii), (v), (vi) and (viii) of the definition
of "Mortgage File" are in its possession, (ii) all documents received by it in
respect of such Mortgage Loan have been reviewed by it and appear regular on
their face and relate to such Mortgage Loan, and (iii) based on the examinations
referred to in Section 2.02(a) above and this Section 2.02(b) and only as to the
foregoing documents, the information set forth in the Mortgage Loan Schedule
with respect to the items specified in clauses (ii), (v) and (vi)(B) of the
definition of "Mortgage Loan Schedule" is correct.
(c) 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, instruments, certificates or other papers relating to the
Mortgage Loans delivered to it to determine that the same are valid, legal,
effective, genuine, enforceable, in recordable form, sufficient or appropriate
for the represented purpose or that they are other than what they purport to be
on their face.
SECTION 2.03. Mortgage Loan Seller's Repurchase of Mortgage Loans for
Document Defects and Breaches of Representations and Warranties.
(a) If any party hereto discovers that any document or documents
constituting a part of a Mortgage File has not been properly executed, is
missing, contains information that does not conform in any respect with the
corresponding information set forth in the Mortgage Loan Schedule, or does not
appear to be regular on its face (each, a "Document Defect"), or discovers or
receives notice of a breach of any representation or warranty relating to the
Mortgage Loans set forth in the applicable Mortgage Loan Purchase Agreement (a
"Breach"), and such Document Defect or Breach, as the case may be, materially
and adversely affects the interests of the Certificateholders, such party shall
give prompt written notice to the other parties hereto. Promptly upon becoming
aware of any such Document Defect or Breach (including through such written
notice provided by any party hereto, as provided above), the Master Servicer
shall request that the respective Mortgage Loan Seller, not later than 90 days
from such Mortgage Loan Seller's receipt of such notice, cure such Document
Defect or Breach, as the case may be, in all material respects, which shall
include payment of losses and any Additional Trust Fund Expenses associated
therewith or, if such Document Defect or Breach cannot be cured within the
periods hereinafter set
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forth, repurchase the affected Mortgage Loan at the applicable Purchase Price in
accordance with the Mortgage Loan Purchase Agreement; provided, however, that if
such Document Defect or Breach is capable of being cured but not within such
90-day period and such Mortgage Loan Seller has commenced and is diligently
proceeding with the cure of such Document Defect or Breach within such 90-day
period, such Mortgage Loan Seller shall have an additional 90 days to complete
such cure; and provided, further, that with respect to such additional 90-day
period such Mortgage Loan Seller shall have delivered an Officer's Certificate
to the Trustee setting forth the reason such Document Defect or Breach is not
capable of being cured within the initial 90-day period and what actions such
Mortgage Loan Seller is pursuing in connection with the cure thereof and stating
that such Mortgage Loan Seller anticipates that such Document Defect or Breach
will be cured within the additional 90-day period. If the affected Mortgage Loan
is to be repurchased, the Master Servicer shall designate the Certificate
Account as the account to which funds in the amount of the Purchase Price are to
be wired. Any such repurchase of a Mortgage Loan shall be on a whole loan,
servicing released basis. Notwithstanding the foregoing, the delivery of a
commitment to issue a policy of lender's title insurance in lieu of the delivery
of the actual policy of lender's title insurance shall not be considered a
Document Defect with respect to any Mortgage File if such actual policy of
insurance is delivered to the Trustee or a Custodian on its behalf not later
than the 90th day following the Closing Date. Any reasonable out-of-pocket
expense incurred by the Master Servicer in carrying out its duties pursuant to
this Section 2.03(a) shall constitute a Servicing Advance; provided, however,
that the Master Servicer shall use reasonable efforts to collect such
out-of-pocket expenses from the related Mortgage Loan Seller.
(b) In connection with any repurchase of a Mortgage Loan contemplated by
this Section 2.03, the Trustee, the Custodian, the Master Servicer and the
Special Servicer shall each tender to the appropriate Mortgage Loan Seller, upon
delivery to each of them of a receipt executed by such Mortgage Loan Seller, all
portions of the Mortgage File and other documents pertaining to such Mortgage
Loan possessed by it, and each document that constitutes a part of the Mortgage
File shall be endorsed or assigned to the extent necessary or appropriate to
such Mortgage Loan Seller or its designee in the same manner, and pursuant to
appropriate forms of assignment, substantially similar to the manner and forms
pursuant to which documents were previously assigned to the Trustee; provided
that such tender by the Trustee shall be conditioned upon its receipt from the
Master Servicer of a Request for Release. The Master Servicer shall, and is
hereby authorized and empowered by the Trustee to, prepare, execute and deliver
in its own name, on behalf of the Certificateholders and the Trustee or any of
them, the endorsements and assignments contemplated by this Section 2.03, and
the Trustee shall execute and deliver any powers of attorney necessary to permit
the Master Servicer to do so. The Master Servicer shall indemnify the Trustee
for any costs, liabilities and expenses incurred by the Trustee in connection
with the negligent or willful misuse by the Master Servicer of such powers of
attorney.
(c) Each Mortgage Loan Purchase Agreement provides the sole remedies
available to the Certificateholders, or the Trustee on behalf of the
Certificateholders,
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respecting any Document Defect or Breach with respect to the Mortgage Loans
purchased by the Depositor thereunder.
SECTION 2.04. Representations and Warranties of Depositor.
(a) The Depositor hereby represents and warrants to the Trustee, for its
own benefit and the benefit of the Certificateholders, and to the Fiscal Agent,
the Master Servicer and the Special Servicer, as of the Closing Date, that:
(i) The Depositor is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and
possesses all licenses and authorizations necessary to carry on
its business.
(ii) The execution and delivery of this Agreement by the Depositor,
and the performance and compliance with the terms of this
Agreement by the Depositor, does not and will not violate the
Depositor's certificate of incorporation or bylaws or constitute
a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or result in the breach
of, any material agreement or other instrument to which it is a
party or which is applicable to it or any of its assets.
(iii) The Depositor has the full power and authority to carry on its
business as now being conducted and to enter into and consummate
all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a
valid, legal and binding obligation of the Depositor, enforceable
against the Depositor in accordance with the terms hereof,
subject to (A) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors'
rights generally, and (B) general principles of equity,
regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) The Depositor is not in violation of, and its execution and
delivery of this Agreement and its performance and compliance
with the terms of this Agreement will not constitute a violation
of, any law, any order or decree of any court or arbiter, or any
order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the
Depositor's good faith and reasonable judgment, is likely to
affect materially and adversely either the ability of the
Depositor to perform its obligations under this Agreement or the
financial condition of the Depositor.
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(vi) The transfer of the Mortgage Loans to the Trustee as contemplated
herein requires no regulatory approval, other than any such
approvals as have been obtained, and is not subject to any bulk
transfer or similar law in effect in any applicable jurisdiction.
(vii) No litigation is pending or, to the best of the Depositor's
knowledge, threatened against the Depositor that, if determined
adversely to the Depositor, would prohibit the Depositor from
entering into this Agreement or, in the Depositor's good faith
and reasonable judgment, is likely to materially and adversely
affect either the ability of the Depositor to perform its
obligations under this Agreement or the financial condition of
the Depositor.
(viii) Immediately prior to the transfer of the Mortgage Loans to the
Trust Fund pursuant to this Agreement, (A) the Depositor has good
and marketable title to, and is the sole owner and holder of,
each Mortgage Loan; and (B) the Depositor has full right and
authority to sell, assign and transfer the Mortgage Loans.
(ix) The Depositor is transferring the Mortgage Loans to the Trust
Fund free and clear of any liens, pledges, charges and security
interests.
(b) The representations and warranties of the Depositor set forth in
Section 2.04(a) shall survive the execution and delivery of this Agreement and
shall inure to the benefit of the Persons for whose benefit they were made for
so long as the Trust Fund remains in existence. Upon discovery by any party
hereto of any breach of any of the foregoing representations and warranties, the
party discovering such breach shall give prompt written notice to the other
parties.
SECTION 2.05. Execution, Authentication and Delivery of Class R-I
Certificates; Creation of REMIC I Regular Interests.
The Trustee hereby acknowledges the assignment to it of the assets included
in REMIC I. Concurrently with such assignment and in exchange therefor, (a) the
Trustee agrees to hold a portion of each of the Mortgage Loans included in REMIC
I with a remittance rate, initial uncertificated stated principal amount and a
latest possible maturity date as set forth in the fourth sentence of the second
paragraph of the Preliminary Statement as a REMIC I Regular Interest in
uncertificated form on behalf of the Depositor subject to its concurrent
assignment as set forth in Section 2.06, and (b) the Certificate Registrar,
pursuant to the written request of the Depositor executed by an officer of the
Depositor, has executed, and the Authenticating Agent has authenticated and
delivered to or upon the order of the Depositor, the Class R-I Certificates in
authorized denominations. The interests evidenced by the Class R-I Certificates,
together with the REMIC I Regular Interests, constitute the entire beneficial
ownership of REMIC I. The rights of the Class R-I Certificateholders and REMIC
II (as holder of the REMIC I Regular Interests) to receive distributions from
the proceeds of REMIC I in respect of the Class R-I Certificates and the REMIC I
Regular Interests, respectively, and
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all ownership interests evidenced or constituted by the Class R-I Certificates
and the REMIC I Regular Interests, shall be as set forth in this Agreement.
SECTION 2.06. Conveyance of REMIC I Regular Interests; Acceptance of REMIC
II by Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery of this Agreement, does hereby assign without recourse all the
right, title and interest of the Depositor in and to the REMIC I Regular
Interests to the Trustee for the benefit of the Holders of REMIC II
Certificates. The Trustee acknowledges the assignment to it of the right, title
and interest of the Depositor in the REMIC I Regular Interests and declares that
it holds and will hold the same in trust for the exclusive use and benefit of
all present and future Holders of REMIC II Certificates.
SECTION 2.07. Execution, Authentication and Delivery of Class R-II
Certificates.
The Trustee pursuant to the written request of the Depositor executed by an
officer of the Depositor, has executed, as the Certificate Registrar,
authenticated, as the Authenticating Agent, and delivered to or upon the order
of the Depositor, the Class R-II Certificates in authorized denominations.
SECTION 2.08. Conveyance of REMIC II Regular Interests; Acceptance of REMIC
III by Trustee.
The Depositor, as of the Closing Date, and concurrently with the execution
and delivery of this Agreement, does hereby assign without recourse all the
right, title and interest of the Depositor in and to the REMIC II Regular
Interests to the Trustee for the benefit of the Holders of the REMIC III
Certificates. The Trustee acknowledges the assignment to it of the REMIC II
Regular Interests and declares that it holds and will hold the same in trust for
the exclusive use and benefit of all present and future Holders of REMIC III
Certificates.
SECTION 2.09. Execution, Authentication and Delivery of REMIC III
Certificates.
Concurrently with the assignment to it of the REMIC II Regular Interests
and in exchange therefor, the Certificate Registrar has executed, and the
Trustee, as the Authenticating Agent, has authenticated and delivered to or upon
the order of the Depositor, the REMIC III Certificates in authorized
denominations evidencing the entire beneficial ownership of REMIC III. The
rights of the holders of the respective Classes of REMIC III Certificates to
receive distributions from the proceeds of REMIC III in respect of their REMIC
III Certificates, and all ownership interests evidenced or constituted by the
respective Classes of REMIC III Certificates in such distributions, shall be as
set forth in this Agreement.
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ARTICLE III
ADMINISTRATION AND SERVICING OF THE TRUST FUND
SECTION 3.01. Administration of the Mortgage Loans.
(a) Each of the Master Servicer and the Special Servicer shall service and
administer the Mortgage Loans that each is obligated to service and administer
pursuant to this Agreement on behalf of the Trustee, for the benefit of the
Certificateholders, in accordance with any and all applicable laws, the terms of
this Agreement and of the respective Mortgage Loans and, to the extent
consistent with the foregoing, in accordance with the Servicing Standard.
Without limiting the foregoing, and subject to Section 3.21, (i) the Master
Servicer shall service and administer all Mortgage Loans that are not Specially
Serviced Mortgage Loans, and (ii) the Special Servicer shall service and
administer (x) each Specially Serviced Mortgage Loan, and (y) each REO Property;
provided, however, that the Master Servicer shall continue to collect
information and prepare all reports to the Trustee required hereunder with
respect to any Specially Serviced Mortgage Loans and REO Properties (and the
related REO Loans), and shall make Servicing Advances and/or reimburse the
Special Servicer for reimbursable expenses which constitute a Servicing Advance
with respect to Specially Serviced Mortgage Loans and REO Properties and further
shall render such incidental services with respect to any Specially Serviced
Mortgage Loans and REO Properties as are specifically provided for herein. The
Special Servicer shall notify the Master Servicer, by delivery of an Officer's
Certificate of the Special Servicer, of the costs and expenses incurred or to be
incurred by the Special Servicer with respect to any Specially Serviced Mortgage
Loan, REO Loan or REO Property. The Master Servicer shall reimburse the Special
Servicer for any Servicing Advance made by the Special Servicer out of the
Certificate Account pursuant to Section 3.05(a) or (i) if the Master Servicer
determines such Servicing Advance is not a Nonrecoverable Servicing Advance, the
Master Servicer shall make a Servicing Advance with respect to such costs and
expenses or reimburse the Special Servicer for such costs and expenses pursuant
to Section 3.05(a) or (ii) the Master Servicer shall notify the Special Servicer
that the Master Servicer has determined that the Servicing Advance is a
Nonrecoverable Servicing Advance. Neither the Master Servicer nor the Special
Servicer shall be required to make any Servicing Advance to the extent such
Servicing Advance, if made, would constitute a Nonrecoverable Servicing Advance.
Notwithstanding any obligation of or action to be taken by the Special Servicer
herein, unless a provision in this Agreement specifically requires that the
Special Servicer make a Servicing Advance, the Special Servicer may, but shall
have no obligation to, make any Servicing Advance out of its own funds and shall
have no obligation to take any action required or permitted hereunder if such
action would require it to make a Servicing Advance out of its own funds. All
references herein to the respective duties of the Master Servicer and the
Special Servicer, and to the areas in which they may exercise discretion, shall
be subject to Section 3.21.
(b) Subject to Section 3.01(a), and with respect to the Special Servicer,
Section 6.11, the Master Servicer and the Special Servicer each shall have full
power and authority, acting alone, or through one or more Sub-Servicers as
provided in Section 3.22, to
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do or cause to be done any and all things in connection with such servicing and
administration which it may deem necessary or desirable. Without limiting the
generality of the foregoing, each of the Master Servicer and the Special
Servicer, in its own name, with respect to each of the Mortgage Loans it is
obligated to service hereunder, is hereby authorized and empowered by the
Trustee to execute and deliver, on behalf of the Certificateholders and the
Trustee or any of them, (i) any and all financing statements, continuation
statements and other documents or instruments necessary to maintain the lien
created by any Mortgage or other security document in the related Mortgage File
on the related Mortgaged Property and related collateral; (ii) in accordance
with the Servicing Standard and subject to Section 3.20, any and all
modifications, waivers, amendments or consents to or with respect to any
documents contained in the related Mortgage File; and (iii) any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and all other comparable instruments. Subject to Section 3.10, the
Trustee shall, at the written request of the Master Servicer or the Special
Servicer, promptly, but in any event within five Business Days of such request,
furnish, or cause to be so furnished, to the Master Servicer and the Special
Servicer any limited powers of attorney and other documents necessary or
appropriate to enable them to carry out their servicing and administrative
duties hereunder; provided, however, that the Trustee shall not be held liable
for any misuse of any such power of attorney by the Master Servicer or the
Special Servicer and shall be indemnified by each of the Master Servicer and the
Special Servicer for any costs, liabilities and expenses incurred by the Trustee
in connection with the negligent or willful misuse of such powers of attorney by
the Master Servicer or the Special Servicer.
(c) The relationship of each of the Master Servicer and the Special
Servicer to the Trustee under this Agreement is intended by the parties to be
that of an independent contractor and not that of a joint venture, partner or
agent.
SECTION 3.02. Collection of Mortgage Loan Payments.
(a) Each of the Master Servicer or the Special Servicer shall undertake
reasonable efforts to collect all payments required under the terms and
provisions of the Mortgage Loans it is obligated to service hereunder and shall,
to the extent such procedures shall be consistent with this Agreement, follow
such collection procedures in accordance with the Servicing Standard. Consistent
with the foregoing, the Special Servicer, with regard to a Specially Serviced
Mortgage Loan, or the Master Servicer, with regard to a Mortgage Loan that is
not a Specially Serviced Mortgage Loan, may waive any Penalty Interest or late
payment charge in connection with any payment on a Mortgage Loan.
(b) All amounts collected in respect of any Mortgage Loan in the form of
payments from Mortgagors, Liquidation Proceeds (insofar as such Liquidation
Proceeds are of the nature described in clauses (i) through (iii) of the
definition thereof) or Insurance Proceeds shall be applied to either amounts due
and owing under the related Mortgage Note and Mortgage (including, without
limitation, for principal and accrued and unpaid interest) in accordance with
the express provisions of the related Mortgage Note and Mortgage or, if required
pursuant to the express provisions of the related Mortgage, or as determined by
the
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Master Servicer or Special Servicer in accordance with the Servicing Standard,
to the repair or restoration of the related Mortgaged Property, and, in the
absence of such express provisions, shall be applied for purposes of this
Agreement: first, as a recovery of any related and unreimbursed Servicing
Advances plus interest accrued thereon; second, as a recovery of accrued and
unpaid interest, to the extent such amounts have not been previously advanced,
at the related Mortgage Rate on such Mortgage Loan; third, as a recovery of
principal of such Mortgage Loan then due and owing, to the extent such amounts
have not been previously advanced, including, without limitation, by reason of
acceleration of the Mortgage Loan following a default thereunder; fourth, in
accordance with the normal servicing practices of the Master Servicer, as a
recovery of any other amounts then due and owing under such Mortgage Loan,
including, without limitation, Prepayment Premiums and Penalty Interest; and
fifth, as a recovery of any remaining principal of such Mortgage Loan to the
extent of its entire remaining unpaid principal balance. All amounts collected
on any Mortgage Loan in the form of Liquidation Proceeds of the nature described
in clauses (iv) and (v) of the definition thereof shall be deemed to be applied:
first, as a recovery of any related and unreimbursed Servicing Advances plus
interest accrued thereon; second, as a recovery of accrued and unpaid interest
to, the extent such amounts have not been previously advanced, on such Mortgage
Loan to but not including the Due Date in the Collection Period of receipt; and
third, as a recovery of principal, to the extent such amounts have not been
previously advanced, of such Mortgage Loan to the extent of its entire unpaid
principal balance. No such amounts shall be applied to the items constituting
additional servicing compensation as described in the first sentence of Section
3.11(b) unless and until all principal and interest then due and payable on such
Mortgage Loan has been collected. Amounts collected on any REO Loan shall be
deemed to be applied in accordance with the definition thereof. The provisions
of this paragraph with respect to the application of amounts collected shall not
alter in any way the right of the Master Servicer or the Special Servicer to
receive payments from the Certificate Account as set forth in clauses (ii)
through (xv) of Section 3.05(a) from amounts so applied.
(c) With respect to a Hyperamortization Mortgage Loan, in the event that
the Master Servicer or Special Servicer receives, or receives notice from the
related Mortgagor that the Master Servicer or Special Servicer will be
receiving, Additional Interest in any Collection Period, the Master Servicer or
Special Servicer, as applicable, shall promptly notify the Trustee, but in no
case later than the fourth business day following each Determination Date but in
any event no later than the third business day prior to the Distribution Date.
SECTION 3.03. Collection of Taxes, Assessments and Similar Items; Servicing
Accounts; Reserve Accounts.
(a) The Master Servicer shall, as to all of the Mortgage Loans, establish
and maintain one or more accounts (the "Servicing Accounts"), into which all
Escrow Payments shall be deposited and retained. Each Servicing Account shall be
an Eligible Account. The Special Servicer shall promptly remit any Escrow
Payments that it receives to the Master Servicer for deposit into the applicable
Servicing Account. With respect to any such amounts
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paid by check to the order of the Special Servicer, the Special Servicer shall
endorse such checks, without recourse, to the order of the Master Servicer and
shall promptly remit any such check to the Master Servicer. Withdrawals of
amounts so collected from a Servicing Account may be made (to the extent amounts
have been escrowed for such purpose) only to: (i) effect payment of real estate
taxes, assessments, insurance premiums, ground rents (if applicable) and
comparable items; (ii) reimburse the Master Servicer for any Servicing Advances
plus interest accrued thereon; (iii) refund to Mortgagors any sums as may be
determined to be overages; (iv) pay interest, if required and as described
below, to Mortgagors on balances in the Servicing Account; or (v) clear and
terminate the Servicing Account at the termination of this Agreement in
accordance with Section 9.01. The Master Servicer shall pay or cause to be paid
to the Mortgagors interest, if any, earned on the investment of funds in
Servicing Accounts maintained thereby, if required by law or the terms of the
related Mortgage Loan. If the Master Servicer shall deposit in a Servicing
Account any amount not required to be deposited therein, it may at any time
withdraw such amount from such Servicing Account, any provision herein to the
contrary notwithstanding. The Servicing Accounts shall not be considered part of
the segregated pool of assets constituting REMIC I.
(b) The Master Servicer, as to each Mortgaged Property (other than an REO
Property) and the Special Servicer shall, as to any REO Property, (i) maintain
accurate records with respect to the related Mortgaged Property or REO Property,
as applicable, reflecting the status of real estate taxes, assessments and other
similar items that are or may become a lien thereon and the status of insurance
premiums and any ground rents payable in respect thereof and (ii) use reasonable
efforts to obtain, from time to time, all bills for the payment of such items
(including renewal premiums) and shall effect payment thereof prior to the
applicable penalty or termination date. For purposes of effecting any such
payment for which it is responsible, the Master Servicer shall apply Escrow
Payments as allowed under the terms of the related Mortgage Loan (in the case of
a Mortgaged Property other than an REO Property) or amounts on deposit in the
applicable REO Account (in the case of an REO Property) or, if such Mortgage
Loan does not require the related Mortgagor to escrow for the payment of real
estate taxes, assessments, insurance premiums, ground rents (if applicable) and
similar items, the Master Servicer shall, as to those Mortgage Loans it is
obligated to service hereunder and at the time the Master Servicer determines in
accordance with the Servicing Standard that any such payments have not been made
when due, enforce the requirement of the related Mortgage that the Mortgagor
make payments in respect of such items and provide proof of such payment to the
Master Servicer. With respect to any Specially Serviced Mortgage Loan, the
Master Servicer shall notify the Special Servicer within five Business Days
after the Master Servicer becomes aware of any failure by the related Mortgagor
to make such payments as they first become due and the Special Servicer shall,
consistent with the Servicing Standard, and to the extent permitted by the terms
of the applicable Mortgage Loan documents, seek to require that such payments be
made by the Mortgagor and that proof of such payment be provided to the Special
Servicer and the Master Servicer.
(c) With respect to all Mortgage Loans and REO Loans (in each case to the
extent set forth herein) in respect of which the Mortgage Loan documents or
applicable law
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requires the related Mortgagor to escrow payments for (i) real estate taxes,
assessments and other similar items, (ii) ground rents (if applicable), (iii)
water rates, tenant improvements or leasing commission expenses, environmental
remediation expenses and other similar items and (iv) premiums on Insurance
Policies, the Master Servicer shall, make a Servicing Advance with respect to
the related Mortgaged Property in an amount equal to all such funds as are
necessary for the purpose of effecting the payment of (i) real estate taxes,
assessments and other similar items, (ii) ground rents (if applicable), (iii)
water rates, tenant improvement or leasing commission expenses, environmental
remediation expenses and other similar items and (iv) premiums on Insurance
Policies, in each instance if and to the extent Escrow Payments (if any)
collected from the related Mortgagor are insufficient to pay such item when due
and the related Mortgagor has failed to pay such item on a timely basis, and
provided that the particular Servicing Advance would not, if made, constitute a
Nonrecoverable Servicing Advance. With respect to any Mortgage Loan that does
not require the Mortgagor to escrow such payments, the Master Servicer shall,
consistent with the Servicing Standard seek to require that any such payments be
made by the Mortgagor at the time they first become due. If such Mortgagor fails
to pay any of the items referred to in clauses (i)-(iv) above on a timely basis
and collections from the Mortgagor are insufficient to pay any such items when
due, the Master Servicer shall, promptly, upon the Master Servicer discovering
that such Mortgagor failed to make such payment using efforts consistent with
the Servicing Standard to make such a determination, make a Servicing Advance
with respect to any shortfall, subject to the Master Servicer determining that
such Advance if made would not be a Nonrecoverable Advance. All such Servicing
Advances shall be reimbursable in the first instance from related collections
from the Mortgagors, and further as provided in Section 3.05(a). To the extent
that the amounts on deposit in the applicable REO Account are insufficient to
pay any of the items referred to in the first sentence of this paragraph, with
respect to the related REO Property, the Special Servicer shall advise the
Master Servicer, by delivery of an Officer's Certificate, of the amounts of
funds required to cover such shortfall, and the Master Servicer shall make a
Servicing Advance with respect thereto, subject to the Master Servicer
determining such Servicing Advance if made would not be a Nonrecoverable
Advance. In the case of any Specially Serviced Mortgage Loans other than REO
Loans, if a Mortgagor fails to pay any of the items referred to in the first
sentence of this paragraph on a timely basis and collections from the Mortgagor
are insufficient to pay any such item when due, the Master Servicer shall make a
Servicing Advance with respect thereto, subject to the Master Servicer
determining that such Servicing Advance if made would not be a Nonrecoverable
Servicing Advance. The Special Servicer shall not make a Servicing Advance
pursuant to this Section 3.03(c). No costs incurred by the Master Servicer in
effecting the payment of real estate taxes, assessments and, if applicable,
ground rents on or in respect of such Mortgaged Properties or REO Properties
shall, for purposes of this Agreement, including, without limitation, the Paying
Agent's calculation of monthly distributions to Certificateholders, be added to
the unpaid Stated Principal Balances of the related Mortgage Loans,
notwithstanding that the terms of such Mortgage Loans so permit. The foregoing
shall in no way limit the Master Servicer's or Special Servicer's ability to
charge and collect from the Mortgagor such costs together with interest thereon.
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(d) In connection with its recovery of any Servicing Advance from the
Certificate Account pursuant to Section 3.05(a), the Master Servicer or Special
Servicer shall be entitled to receive, out of any amounts then on deposit in the
Certificate Account, interest at the Reimbursement Rate in effect from time to
time, accrued on the amount of such Servicing Advance from the date made to but
not including the date of reimbursement. The Master Servicer shall reimburse
itself and, if applicable, the Special Servicer for any Servicing Advance as
soon as practicable after funds available for such purpose are deposited in the
Certificate Account.
(e) The determination by the Master Servicer or Special Servicer that it
has made a Nonrecoverable Servicing Advance or that any proposed Servicing
Advance, if made, would constitute a Nonrecoverable Servicing Advance, shall be
made in accordance with the Servicing Standard and shall be evidenced by an
Officers' Certificate delivered promptly to the Trustee and the Depositor (and
to the extent such determination is made by the Special Servicer, the Master
Servicer), setting forth the basis for such determination, together with a copy
of any Appraisal of the related Mortgaged Property or REO Property, as the case
may be, performed pursuant to Section 3.09(a) at the request of the Master
Servicer or by the Special Servicer if the Mortgage Loan is a Defaulted Mortgage
Loan or, if no such appraisal has been performed, a copy of an appraisal of the
related Mortgaged Property or REO Property performed within the twelve months
preceding such determination by an Independent Appraiser or other expert in real
estate matters, and further accompanied by related Mortgagor operating
statements and financial statements, budgets and rent rolls of the related
Mortgaged Property and any engineers' reports, environmental surveys or similar
reports that the Master Servicer or the Special Servicer may have obtained and
that support such determination.
(f) The Master Servicer shall, as to all of the Mortgage Loans, establish
and maintain, as applicable, one or more accounts (the "Reserve Accounts"), into
which all Reserve Funds, if any, shall be deposited and retained. Withdrawals of
amounts so deposited may be made to pay for, or to reimburse the related
Mortgagor in connection with, the related repairs and/or capital improvements at
the related Mortgaged Property if the repairs and/or capital improvements have
been completed, and such withdrawals are made in accordance with the Servicing
Standard and the terms of the related Mortgage Note, Mortgage and any agreement
with the related Mortgagor governing such Reserve Funds. All Reserve Accounts
shall be Eligible Accounts. The Reserve Accounts shall not be considered part of
the segregated pool of assets comprising REMIC I.
SECTION 3.04. Certificate Account, Distribution Account and Additional
Interest Distribution Account.
(a) The Master Servicer shall establish and maintain one or more accounts
(collectively, the "Certificate Account"), held on behalf of the Trustee in
trust for the benefit of the Certificateholders. The Certificate Account shall
be an Eligible Account. The Master Servicer or the Trustee (with respect to
clause (viii) below) shall deposit or cause to be deposited in the Certificate
Account, upon receipt (in the case of payments by Mortgagors or other
collections on the Mortgage Loans) or as otherwise required hereunder, the
following
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payments and collections received or made by the Master Servicer or on its
behalf subsequent to the Cut-off Date (other than in respect of principal and
interest on the Mortgage Loans due and payable on or before the Cut-off Date,
which payments shall be delivered promptly to the appropriate Mortgage Loan
Seller or its designee, with negotiable instruments endorsed as necessary and
appropriate without recourse), or payments (other than Principal Prepayments)
received by it on or prior to the Cut-off Date but allocable to a period
subsequent thereto:
(i) all payments on account of principal of the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans,
including Penalty Interest;
(iii) all Prepayment Premiums;
(iv) all Insurance Proceeds and Liquidation Proceeds (other than
Liquidation Proceeds described in clause (vi) of the definition
thereof that are required to be deposited in the Distribution
Account pursuant to Section 9.01) received in respect of any
Mortgage Loan;
(v) any amounts required to be deposited by the Master Servicer
pursuant to Section 3.06 in connection with losses incurred with
respect to Permitted Investments of funds held in the Certificate
Account;
(vi) any amounts required to be deposited by the Master Servicer or
the Special Servicer pursuant to Section 3.07(b) in connection
with losses resulting from a deductible clause in a blanket
hazard policy;
(vii) any amounts required to be transferred from an REO Account
pursuant to Section 3.16(c); and
(viii) any Servicing Fee Increase.
The foregoing requirements for deposit in the Certificate Account shall be
exclusive. Notwithstanding the foregoing, actual payments from Mortgagors in the
nature of Escrow Payments, and amounts that the Master Servicer is entitled to
retain as additional servicing compensation pursuant to Section 3.11(b), need
not be deposited by the Master Servicer in the Certificate Account. If the
Master Servicer shall deposit in the Certificate Account any amount not required
to be deposited therein, it may at any time withdraw such amount from the
Certificate Account, any provision herein to the contrary notwithstanding. The
Master Servicer shall promptly deliver to the Special Servicer as additional
servicing compensation in accordance with Section 3.11(d) assumption fees, late
charges and other transaction fees received by the Master Servicer with respect
to Specially Serviced Mortgage Loans upon receipt of a certificate of a
Servicing Officer of the Special Servicer describing the item and amount. The
Certificate Account shall be maintained as a segregated account,
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separate and apart from trust funds created for mortgage pass-through
certificates of other series and the other accounts of the Master Servicer.
Upon receipt of any of the amounts described in clauses (i) through (iv)
above with respect to any Mortgage Loan, the Special Servicer shall promptly,
but in no event later than one Business Day after receipt, remit such amounts to
the Master Servicer for deposit into the Certificate Account in accordance with
the second preceding paragraph, unless the Special Servicer determines,
consistent with the Servicing Standard, that a particular item should not be
deposited because of a restrictive endorsement or other appropriate reason. Any
such amounts received by the Special Servicer with respect to an REO Property
shall be deposited by the Special Servicer into the REO Account and remitted to
the Master Servicer for deposit into the Certificate Account pursuant to Section
3.16(c). With respect to any such amounts paid by check to the order of the
Special Servicer, the Special Servicer shall endorse such check to the order of
the Master Servicer and shall deliver promptly, but in no event later than three
Business Days after receipt, any such check to the Master Servicer by overnight
courier, unless the Special Servicer determines, consistent with the Servicing
Standard, that a particular item cannot be so endorsed and delivered because of
a restrictive endorsement or other appropriate reason.
(b) The Paying Agent shall establish and maintain one or more trust
accounts (collectively, the "Distribution Account") to be held in trust for the
benefit of the Certificateholders. The Distribution Account shall be an Eligible
Account. The Master Servicer shall deliver to the Paying Agent each month on or
before the P&I Advance Date therein, for deposit in the Distribution Account, an
aggregate amount of immediately available funds equal to that portion of the
Available Distribution Amount for the related Distribution Date then on deposit
in the Certificate Account, together with (i) any Prepayment Premiums received
on the Mortgage Loans during the related Collection Period and (ii) in the case
of the final Distribution Date, any additional amounts contemplated by the
second paragraph of Section 9.01.
In addition, the Master Servicer (or the Trustee or the Fiscal Agent, as
applicable, with respect to clause (i) below) shall, as and when required
hereunder, deliver to the Paying Agent for deposit in the Distribution Account:
(i) any P&I Advances required to be made by the Master Servicer in
accordance with Section 4.03(a);
(ii) any amounts required to be deposited by the Master Servicer
pursuant to Section 3.06 in connection with losses realized on
Permitted Investments with respect to funds held in the
Distribution Account;
(iii) any amounts required to be deposited by the Master Servicer
pursuant to Section 3.19 in connection with Prepayment Interest
Shortfalls; and
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(iv) the Purchase Price paid by the Master Servicer in connection with
the purchase of all of the Mortgage Loans and any REO Properties
pursuant to Section 9.01, exclusive of the portion of such
amounts required to be deposited in the Certificate Account
pursuant to Section 9.01.
The Paying Agent shall, upon receipt, deposit in the Distribution Account
any and all amounts received by the Paying Agent that are required by the terms
of this Agreement to be deposited therein.
(c) Prior to the P&I Advance Date relating to any Collection Period in
which Additional Interest is received, the Trustee shall establish and maintain
the Additional Interest Distribution Account in the name of the Trustee in trust
for the benefit of Gemstone Acquisition Corporation or its assignee. The
Additional Interest Distribution Account shall be established and maintained as
an Eligible Account. On or before the P&I Advance Date related to the applicable
Distribution Date, the Master Servicer shall deliver to the Paying Agent for
deposit in the Additional Interest Distribution Account an amount equal to the
Additional Interest received during the related Collection Period. Following the
distribution of any Additional Interest to Gemstone Acquisition Corporation or
its assignee on the first Distribution Date after which there are no longer any
Hyperamortization Mortgage Loans outstanding, the Trustee shall terminate the
Additional Interest Distribution Account.
(d) Funds in the Certificate Account, the Distribution Account and the
Additional Interest Distribution Account may be invested in Permitted
Investments in accordance with the provisions of Section 3.06. The Master
Servicer and Paying Agent, as the case may be, shall give notice to each other,
the Trustee, the Fiscal Agent, the Special Servicer and the Rating Agencies of
the location of the Distribution Account, the Additional Interest Distribution
Account and Certificate Account as of the Closing Date and of the new location
of the Certificate Account, the Distribution Account or the Additional Interest
Distribution Account, prior to any change thereof.
SECTION 3.05. Permitted Withdrawals From the Certificate Account and the
Distribution Account.
(a) The Master Servicer may, from time to time, make withdrawals from the
Certificate Account for any of the following purposes (the order set forth below
not constituting an order of priority for such withdrawals):
(i) to remit to the Paying Agent for deposit (i) in the Distribution
Account the amounts required to be so deposited pursuant to the
first paragraph of Section 3.04(b) and (ii) in the Additional
Interest Distribution Account, the amounts required to be
deposited pursuant to Section 3.04(c);
(ii) to reimburse the Fiscal Agent, the Trustee and itself, in that
order, for unreimbursed P&I Advances, the Master Servicer's right
to reimburse the Fiscal Agent, the Trustee and itself, in that
order, pursuant to this clause (ii) with respect to any P&I
Advance (other than Nonrecoverable
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Advances, which are reimbursable pursuant to clause (vii) below)
being limited to amounts that represent Late Collections of
interest (net of the related Servicing Fee) on and principal (net
of any related Principal Recovery Fee) received in respect of the
particular Mortgage Loan or REO Loan as to which such P&I Advance
was made;
(iii) to pay to itself earned and unpaid Servicing Fees in respect of
each Mortgage Loan and REO Loan, the Master Servicer's right to
payment pursuant to this clause (iii) with respect to any
Mortgage Loan or REO Loan being limited to amounts received on or
in respect of such Mortgage Loan (whether in the form of
payments, Liquidation Proceeds or Insurance Proceeds) or such REO
Loan (whether in the form of REO Revenues, Liquidation Proceeds
or Insurance Proceeds) that are allocable as a recovery of
interest thereon;
(iv) to pay to the Special Servicer earned and unpaid Special
Servicing Fees in respect of each Specially Serviced Mortgage
Loan;
(v) to pay the Special Servicer (or, if applicable, a predecessor
Special Servicer) earned and unpaid Principal Recovery Fees in
respect of each Specially Serviced Mortgage Loan, Corrected
Mortgage Loan and REO Loan, the Special Servicer's (or, if
applicable, any predecessor Special Servicer's) right to payment
pursuant to this clause (v) with respect to any such Mortgage
Loan or REO Loan being limited to amounts received on or in
respect of such Mortgage Loan (whether in the form of payments,
Liquidation Proceeds or Insurance Proceeds) or such REO Loan
(whether in the form of REO Revenues, Liquidation Proceeds or
Insurance Proceeds) that are allocable as a recovery of principal
thereon (provided that no Principal Recovery Fee shall be payable
out of any Liquidation Proceeds received in connection with the
purchase of any Mortgage Loan or REO Property by the applicable
Mortgage Loan Seller pursuant to the respective Mortgage Loan
Purchase Agreement, by the Majority Subordinate Certificateholder
pursuant to Section 3.18(b) or by the Master Servicer or
Depositor pursuant to Section 9.01);
(vi) to reimburse itself or the Special Servicer for any unreimbursed
Servicing Advances, the Master Servicer's right to reimbursement
pursuant to this clause (vi) with respect to any Servicing
Advance being limited to payments made by the related Mortgagor
that are allocable to such Servicing Advance, or to Liquidation
Proceeds, Insurance Proceeds and, if applicable, REO Revenues
received in respect of the particular Mortgage Loan or REO
Property as to which such Servicing Advance was made;
(vii) to reimburse the Fiscal Agent and the Trustee, in that order,
and then itself and the Special Servicer, on a pari passu basis,
for any unreimbursed Advances that have been or are determined to
be Nonrecoverable Advances or
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to pay itself, with respect to any Mortgage Loan or REO
Property, any related earned Servicing Fee that remained unpaid
in accordance with clause (iii) above;
(viii) at such time as it reimburses itself, the Trustee or the Fiscal
Agent for any unreimbursed Advance pursuant to clause (ii), (vi)
or (vii) above, to pay the Fiscal Agent and the Trustee, in that
order, and then itself and the Special Servicer, on a pari passu
basis, any interest accrued and payable thereon in accordance
with Section 3.03(d) or 4.03(d), as applicable;
(ix) to pay for costs and expenses incurred by the Trust Fund pursuant
to Section 3.09(c);
(x) to pay itself, as additional servicing compensation in accordance
with Section 3.11(b), interest and investment income earned in
respect of amounts held in the Certificate Account as provided in
Section 3.06(b), but only to the extent of the Net Investment
Earnings with respect to the Certificate Account for any
Collection Period;
(xi) to pay for the cost of an Independent Appraiser or other expert
in real estate matters retained pursuant to Section 3.03(e),
3.09(a), 3.18(e) or 4.03(c);
(xii) to pay itself, the Special Servicer, the Depositor, or any of
their respective directors, officers, employees and agents, as
the case may be, any amounts payable to any such Person pursuant
to Section 6.03;
(xiii) to pay for (A) the advice of counsel contemplated by Section
3.17(a)(iii), (B) the cost of the Opinions of Counsel
contemplated by Sections 3.09(b)(ii), 3.09(c), 3.16(a) and
11.02(a), (C) the cost of an Opinion of Counsel contemplated by
Section 11.01(a) or 11.01(c) in connection with any amendment to
this Agreement requested by the Master Servicer or the Special
Servicer that protects or is in furtherance of the rights and
interests of Certificateholders, (D) the cost of obtaining the
REO Extension sought by the Special Servicer as contemplated by
Section 3.16(a), and (E) the cost of recording this Agreement in
accordance with Section 11.02(a);
(xiv) to pay itself, the Special Servicer, the appropriate Mortgage
Loan Seller, the Majority Subordinate Certificateholder or any
other Person, as the case may be, with respect to each Mortgage
Loan, if any, previously purchased by such Person pursuant to
this Agreement, all amounts received thereon subsequent to the
date of purchase; and
(xv) to clear and terminate the Certificate Account at the termination
of this Agreement pursuant to Section 9.01.
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The Master Servicer shall keep and maintain separate accounting records, on
a loan-by-loan and property-by-property basis when appropriate, in connection
with any withdrawal from the Certificate Account pursuant to clauses (ii) -
(xiv) above.
The Master Servicer shall pay to the Special Servicer (or to third party
contractors at the direction of the Special Servicer), the Trustee or the Fiscal
Agent from the Certificate Account amounts permitted to be paid to the Special
Servicer (or to such third party contractors), the Trustee or the Fiscal Agent
therefrom promptly upon receipt of a certificate of a Servicing Officer of the
Special Servicer or of a Responsible Officer of the Trustee or Fiscal Agent, as
the case may be, describing the item and amount to which the Special Servicer
(or such third party contractors), the Trustee or the Fiscal Agent is entitled.
The Master Servicer may rely conclusively on any such certificate and shall have
no duty to re-calculate the amounts stated therein. The Special Servicer shall
keep and maintain separate accounting for each Specially Serviced Mortgage Loan
and REO Property, on a loan-by-loan and property-by-property basis, for the
purpose of justifying any request for withdrawal from the Certificate Account.
With respect to each Mortgage Loan for which it makes a P&I Advance, each of the
Trustee and Fiscal Agent shall similarly keep and maintain separate accounting
for each Mortgage Loan, on a loan by loan and property basis, for the purpose of
justifying any request for withdrawal from the Certificate Account for
reimbursements of P&I Advances or interest thereon.
(b) The Paying Agent may, from time to time, make withdrawals from the
Distribution Account for any of the following purposes (in no particular order
of priority):
(i) to make distributions to Certificateholders on each Distribution
Date pursuant to Section 4.01 or 9.01, as applicable;
(ii) to pay the Trustee or any of its directors, officers, employees
and agents, as the case may be, any amounts payable or
reimbursable to any such Person pursuant to Section 8.05;
(iii) to pay the Master Servicer, as additional servicing compensation
in accordance with Section 3.11(b), interest and investment
income earned in respect of amounts held in the Distribution
Account as provided in Section 3.06(b) (but only to the extent of
the Net Investment Earnings with respect to the Distribution
Account for any Collection Period);
(iv) to pay for the cost of the Opinions of Counsel sought by the
Trustee (A) as provided in clause (v) of the definition of
"Disqualified Organization", (B) as contemplated by Sections
9.02(a)(i) and 10.01(i), or (C) as contemplated by Section
11.01(a) or 11.01(c) in connection with any amendment to this
Agreement requested by the Trustee which amendment is in
furtherance of the rights and interests of Certificateholders;
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(v) to pay any and all federal, state and local taxes imposed on any
of the REMICs created hereunder or on the assets or transactions
of any such REMIC, together with all incidental costs and
expenses, to the extent none of the Trustee, the REMIC
Administrator, the Master Servicer or the Special Servicer is
liable therefor pursuant to Section 10.01(j);
(vi) to pay the REMIC Administrator any amounts reimbursable to it
pursuant to Section 10.01(f);
(vii) to pay to the Master Servicer any amounts deposited by the
Master Servicer in the Distribution Account not required to be
deposited therein;
(viii) to pay any amounts payable to the Extension Adviser pursuant to
Section 3.25; and
(ix) to clear and terminate the Distribution Account at the
termination of this Agreement pursuant to Section 9.01.
SECTION 3.06. Investment of Funds in the Certificate Account, the
Distribution Account, the Additional Interest Distribution Account and the REO
Account.
(a) The Master Servicer may direct in writing any depository institution
maintaining the Certificate Account or the Additional Interest Distribution
Account and may direct in writing the Paying Agent with respect to the
Distribution Account (each, for purposes of this Section 3.06, an "Investment
Account"), and the Special Servicer may direct in writing any depository
institution maintaining the REO Account (also, for purposes of this Section
3.06, an "Investment Account"), to invest, or if it is such depository
institution, may itself invest, the funds held therein in one or more Permitted
Investments bearing interest or sold at a discount, and maturing, no later than
the Business Day immediately preceding the next succeeding date on which such
funds are required to be withdrawn from such account pursuant to this Agreement.
In the event that the Master Servicer shall have failed to give investment
directions for any Certificate Account, Additional Interest Distribution Account
or Distribution Account or the Special Servicer shall have failed to give
investment directions for the REO Account by 11:00 A.M. New York time on any
Business Day on which there may be uninvested cash, such funds shall be invested
in securities described in clause (i) of the definition of the term "Permitted
Investments." All such Permitted Investments shall be held to maturity, unless
payable on demand. Any investment of funds in an Investment Account shall be
made in the name of the Trustee (in its capacity as such). The Master Servicer
(with respect to Permitted Investments of amounts in the Certificate Account,
the Additional Interest Distribution Account and the Distribution Account) and
the Special Servicer (with respect to Permitted Investments of amounts in the
REO Account), on behalf of the Trustee, shall (and the Trustee hereby designates
the Master Servicer and the Special Servicer, as applicable, as the person that
shall) maintain continuous possession of any Permitted Investment that is either
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(i) a "certificated security", as such term is defined in the UCC, or (ii) other
property in which a secured party may perfect its security interest by
possession under the UCC or any other applicable law. Possession of any such
Permitted Investment by the Master Servicer or the Special Servicer shall
constitute possession by a Person designated by the Trustee for purposes of
Section 8-313 of the UCC and possession by the Trustee, as secured party, for
purposes of Section 9-305 of the UCC and any other applicable law. If amounts on
deposit in an Investment Account are at any time invested in a Permitted
Investment payable on demand, the Master Servicer (in the case of the
Certificate Account or Additional Interest Distribution Account), the Paying
Agent (in the case of the Distribution Account) or the Special Servicer (in the
case of the REO Account) shall:
(x) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an amount
equal to the lesser of (1) all amounts then payable thereunder
and (2) the amount required to be withdrawn on such date; and
(y) demand payment of all amounts due thereunder promptly upon
determination by the Master Servicer or the Special Servicer, as
the case may be, that such Permitted Investment would not
constitute a Permitted Investment in respect of funds thereafter
on deposit in the Investment Account.
(b) Whether or not the Master Servicer directs the investment of funds in
the Certificate Account, the Additional Interest Distribution Account or the
Distribution Account, interest and investment income realized on funds deposited
therein, to the extent of the Net Investment Earnings, if any, for each
Collection Period, shall be for the sole and exclusive benefit of the Master
Servicer and shall be subject to its withdrawal in accordance with Section
3.05(a) or withdrawal by the Paying Agent at its direction in accordance with
Section 3.05(b), as applicable. Whether or not the Special Servicer directs the
investment of funds in the REO Account, interest and investment income realized
on funds deposited therein, to the extent of the Net Investment Earnings, if
any, for each Collection Period, shall be for the sole and exclusive benefit of
the Special Servicer and shall be subject to its withdrawal in accordance with
Section 3.16(b). If any loss of principal shall be incurred in respect of any
Permitted Investment on deposit in any Investment Account, the Master Servicer
(in the case of the Certificate Account, the Additional Interest Distribution
Account and the Distribution Account) and the Special Servicer (in the case of
the REO Account) shall promptly deposit therein from its own funds, without
right of reimbursement, no later than the end of the Collection Period during
which such loss was incurred, the amount of the Net Investment Loss, if any, for
such Collection Period.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to Section 8.02, upon the request of
Holders of Certificates entitled to not less than 25% of the Voting Rights
allocated to any Class, shall take such action as may be appropriate
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to enforce such payment or performance, including the institution and
prosecution of appropriate proceedings.
(d) Notwithstanding the investment of funds held in any Investment Account,
for purposes of the calculations hereunder, including, without limitation, the
calculation of the Available Distribution Amount, the amounts so invested shall
be deemed to remain on deposit in such Investment Account.
SECTION 3.07. Maintenance of Insurance Policies; Errors and Omissions and
Fidelity Coverage.
(a) The Master Servicer shall cause to be maintained for each Mortgaged
Property all insurance coverage as is required under the related Mortgage;
provided that if and to the extent that any such Mortgage permits the holder
thereof any discretion (by way of consent, approval or otherwise) as to the
insurance coverage that the related Mortgagor is required to maintain, the
Master Servicer shall exercise such discretion in a manner consistent with the
Servicing Standard; and provided further that, if and to the extent that a
Mortgage so permits, the related Mortgagor shall be required to obtain the
required insurance coverage from Qualified Insurers that have a general policy
rating of at least A-X in A.M. Best's Key Rating Guide. The Majority Subordinate
Certificateholder may request that earthquake insurance be secured for one or
more Mortgaged Properties at the expense of the Majority Subordinate
Certificateholder, unless required or permitted to be required under the related
Mortgage Loan, in which case the Master Servicer or Special Servicer, as
applicable, shall use reasonable efforts to enforce such obligation, so long as
such enforcement is consistent with the Servicing Standard. Subject to Section
3.17(a), the Special Servicer shall also cause to be maintained for each REO
Property no less insurance coverage than was previously required of the
Mortgagor under the related Mortgage; provided that all such insurance shall be
obtained from Qualified Insurers that, if they are providing casualty insurance,
shall have a claims paying ability rating of at least "A," "A2" and "A" from
Standard & Poor's, Moody's (if then rated by Moody's) and Fitch (if then rated
by Fitch), respectively (or solely Standard & Poor's, if such insurer is not
rated by Moody's or Fitch) or such lower rating as will not result in
qualification, downgrading or withdrawal of the ratings then assigned to the
Certificates, as evidenced in writing by the Rating Agencies. All such insurance
policies shall contain (if they insure against loss to property and do not
relate to an REO Property) a "standard" mortgagee clause, with loss payable to
the Master Servicer (in the case of insurance maintained in respect of Mortgage
Loans), and shall be in the name of the Special Servicer (in the case of
insurance maintained in respect of REO Properties), on behalf of the Trustee; in
each case such insurance shall be issued by an insurer authorized under
applicable law to issue such insurance. The cost of any such insurance shall be
payable out of amounts on deposit in the related REO Account, or, if the amount
on deposit therein is insufficient, the Special Servicer shall follow the
procedures set forth in Section 3.01 to request the Master Servicer to make a
Servicing Advance with respect to such costs. Any amounts collected by the
Master Servicer or the Special Servicer under any such policies (other than
amounts to be applied to the restoration or repair of the related Mortgaged
Property or REO Property or amounts to be released to the related Mortgagor, in
each case subject to the rights of any tenants and ground
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lessors, as the case may be, and the terms of the related Mortgage and in each
case in accordance with the Servicing Standard) shall be deposited in the
Certificate Account, subject to withdrawal pursuant to Section 3.05(a), in the
case of amounts received in respect of a Mortgage Loan, or in the REO Account,
subject to withdrawal pursuant to Section 3.16(c), in the case of amounts
received in respect of an REO Property. Any cost incurred by the Master Servicer
or the Special Servicer in maintaining any such insurance shall not, for
purposes hereof, including, without limitation, calculating monthly
distributions to Certificateholders, be added to unpaid principal balance of the
related Mortgage Loan, notwithstanding that the terms of such Mortgage Loan so
permit.
(b) If the Master Servicer or the Special Servicer shall obtain and
maintain, or cause to be obtained and maintained, a blanket policy or a master
forced place policy insuring against hazard losses on all of the Mortgage Loans
and/or REO Properties that it is required to service and administer, then, to
the extent such policy (i) is obtained from a Qualified Insurer having a
claims-paying rating of "A," "A2" and "A" or better from Standard & Poor's,
Moody's and Fitch, respectively (or solely Standard & Poor's, if such insurer is
not rated by Moody's and Fitch) or such lower rating of any Rating Agency or
rating from any nationally recognized statistical rating agency as will not
result in qualification, downgrading or withdrawal of the ratings then assigned
to the Certificates, as evidenced in writing by the Rating Agencies, and (ii)
provides protection equivalent to the individual policies otherwise required,
the Master Servicer or the Special Servicer, as the case may be, shall
conclusively be deemed to have satisfied its obligation to cause hazard
insurance to be maintained on the related Mortgaged Properties and/or REO
Properties. Such blanket policy may contain a deductible clause (not in excess
of a customary amount), in which case the Master Servicer or the Special
Servicer, as appropriate, shall, if there shall not have been maintained on the
related Mortgaged Property or REO Property a hazard insurance policy complying
with the requirements of Section 3.07(a), and there shall have been one or more
losses that would have been covered by such policy, promptly deposit into the
Certificate Account from its own funds the amount not otherwise payable under
the blanket policy because of such deductible clause. The Master Servicer or the
Special Servicer, as appropriate, shall prepare and present, on behalf of
itself, the Trustee and Certificateholders, claims under any such blanket policy
in a timely fashion in accordance with the terms of such policy.
(c) Each of the Master Servicer and the Special Servicer shall at all times
during the term of this Agreement (or, in the case of the Special Servicer, at
all times during the term of this Agreement in which Specially Serviced Mortgage
Loans or REO Properties are part of the Trust Fund) keep in force with Qualified
Insurers a fidelity bond issued by an insurer having a claims-paying rating of
"A," "A2" and "A" or better from Standard & Poor's, Moody's (if then rated by
Moody's) and Fitch (if then rated by Fitch), respectively or such lower rating
of any Rating Agency or rating from a nationally recognized statistical rating
agency as will not result in qualification, downgrading or withdrawal of the
ratings then assigned to the Certificates, as evidenced in writing by the Rating
Agencies, in such form and amount as would permit it to be a qualified FNMA
seller-servicer of multifamily mortgage loans, or in such other form and amount
as would not cause the qualification, downgrading or withdrawal of any rating
assigned by either Rating Agency to the Certificates (as evidenced in
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writing from each Rating Agency). Each of the Master Servicer and the Special
Servicer shall be deemed to have complied with the foregoing provision if an
Affiliate thereof has such fidelity bond coverage and, by the terms of such
fidelity bond, the coverage afforded thereunder extends to the Master Servicer
or the Special Servicer, as the case may be. Such fidelity bond shall provide
for ten days' written notice to the Trustee prior to any cancellation.
Each of the Master Servicer and the Special Servicer shall at all times
during the term of this Agreement (or, in the case of the Special Servicer, at
all times during the term of this Agreement in which Specially Serviced Mortgage
Loans and/or REO Properties exist as part of the Trust Fund) also keep in force
with Qualified Insurers having a claims-paying rating of "A," "A2" and "A" or
better from Standard & Poor's, Moody's (if then rated by Moody's) and Fitch (if
then rated by Fitch), or such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to the Certificates, as
evidenced in writing by the Rating Agencies, respectively, a policy or policies
of insurance covering loss occasioned by the errors and omissions of its
officers, employees and agents in connection with its servicing obligations
hereunder, or which policy or policies shall be in such form and amount as would
permit it to be a qualified FNMA seller-servicer of multifamily mortgage loans,
or in such other form and amount as would not adversely affect any rating
assigned by any Rating Agency to the Certificates (as evidenced in writing from
each Rating Agency). Each of the Master Servicer and the Special Servicer shall
be deemed to have complied with the foregoing provisions if an Affiliate thereof
has such insurance and, by the terms of such policy or policies, the coverage
afforded thereunder extends to the Master Servicer or the Special Servicer, as
the case may be. Any such errors and omissions policy shall provide for ten
days' written notice to the Trustee prior to cancellation. The Master Servicer
and the Special Servicer shall each cause the Trustee to be an additional loss
payee on any policy currently in place or procured pursuant to the requirements
of this Section 3.07(c).
For so long as the long-term debt obligations of the Master Servicer or
Special Servicer, as the case may be (or in the case of the initial Master
Servicer and Special Servicer, their respective direct or indirect parent), are
rated "A" (or its equivalent) or better by all of the Rating Agencies (or such
lower rating as will not result in qualification, downgrading or withdrawal of
the ratings then assigned to the Certificates, as evidenced in writing by the
Rating Agencies), such Person may self-insure with respect to the risks
described in this subsection.
SECTION 3.08. Enforcement of Alienation Clauses.
With respect to those Mortgage Loans it is obligated to service hereunder,
each of the Master Servicer and the Special Servicer, on behalf of the Trustee
as the mortgagee of record, shall, to the extent permitted by applicable law and
subject to Section 6.11, enforce the restrictions contained in the related
Mortgage on transfers or further encumbrances of the related Mortgaged Property
and on transfers of interests in the related Mortgagor, unless the Master
Servicer or the Special Servicer, as applicable, has determined, consistent with
the Servicing Standard, that waiver of such restrictions would be in accordance
with the Servicing Standard. Promptly after the Master Servicer or the Special
Servicer has made any such
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determination, the Master Servicer or the Special Servicer shall deliver to the
Trustee, the Rating Agencies and the Master Servicer (if such determination is
made by the Special Servicer) an Officers' Certificate setting forth the basis
for such determination.
SECTION 3.09. Realization Upon Defaulted Mortgage Loans; Required
Appraisals.
(a) The Special Servicer shall, subject to Sections 3.09(b) through 3.09(d)
and Section 6.11, exercise reasonable efforts, consistent with the Servicing
Standard, to foreclose upon or otherwise comparably convert the ownership of
properties securing such of the Mortgage Loans as come into and continue in
default and as to which no satisfactory arrangements can be made for collection
of delinquent payments, including, without limitation, pursuant to Section 3.20.
The Special Servicer shall notify the Master Servicer, by delivery of an
Officer's Certificate of the Special Servicer, of the costs and expenses
incurred or reasonably expected to be incurred by the Special Servicer in any
such foreclosure or other proceeding, and subject to the Master Servicer's
determining, that, if made such Servicing Advance would not be a Nonrecoverable
Servicing Advance, the Master Servicer shall make a Servicing Advance with
respect to such costs and expenses or reimburse the Special Servicer for such
costs and expenses pursuant to Section 3.05(a). Nothing contained in this
Section 3.09 shall be construed so as to require the Special Servicer, on behalf
of the Trust Fund, to make a bid on any Mortgaged Property at a foreclosure sale
or similar proceeding that is in excess of the fair market value of such
property, as determined by the Special Servicer in its reasonable and good faith
judgment taking into account the factors described in Section 3.18(e) and the
results of any appraisal obtained pursuant to the following sentence, all such
bids to be made in a manner consistent with the Servicing Standard. If and when
the Master Servicer or the Special Servicer deems it necessary and prudent for
purposes of establishing the fair market value of any Mortgaged Property
securing a defaulted Mortgage Loan, whether for purposes of bidding at
foreclosure or otherwise, it may, at the expense of the Trust Fund, have an
Appraisal performed with respect to such property. With respect to each Required
Appraisal Mortgage Loan, the Master Servicer will be required to obtain a
Required Appraisal within 60 days of a Mortgage Loan becoming a Required
Appraisal Mortgage Loan and thereafter shall obtain a letter update of such
Required Appraisal once every 12 months if such Mortgage Loan remains a Required
Appraisal Mortgage Loan. The Master Servicer shall advance the cost of such
Required Appraisal pursuant to Section 3.01; provided, however, that such
expense will be subject to reimbursement to the Master Servicer as a Servicing
Advance out of the Certificate Account pursuant to Section 3.05(a) and the
obligation of the Master Servicer to make such Servicing Advance and obtain such
Required Appraisal shall be subject to the Master Servicer's determination that
such Servicing Advance would not be a Nonrecoverable Advance.
(b) The Special Servicer shall not acquire any personal property pursuant
to this Section 3.09 unless either:
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(i) such personal property is incident to real property (within the
meaning of Section 856(e)(1) of the Code) so acquired by the
Special Servicer; or
(ii) the Special Servicer shall have obtained an Opinion of Counsel
(the cost of which may be withdrawn from the Certificate Account
pursuant to Section 3.05(a)) to the effect that the holding of
such personal property as part of the Trust Fund will not cause
the imposition of a tax on any of REMIC I, REMIC II or REMIC III
under the REMIC Provisions or cause any of REMIC I, REMIC II or
REMIC III to fail to qualify as a REMIC at any time that any
Certificate is outstanding.
(c) Notwithstanding the foregoing provisions of this Section 3.09, neither
the Master Servicer nor the Special Servicer shall, on behalf of the Trustee,
obtain title to a Mortgaged Property by deed in lieu of foreclosure or
otherwise, or take any other action with respect to any Mortgaged Property, if,
as a result of any such action, the Trustee, on behalf of the
Certificateholders, could, in the reasonable judgment of the Master Servicer or
the Special Servicer, as the case may be, made in accordance with the Servicing
Standard, be considered to hold title to, to be a "mortgagee-in-possession" of,
or to be an "owner" or "operator" of such Mortgaged Property within the meaning
of CERCLA or any comparable law (a "potentially responsible party"), unless (as
evidenced by an Officers' Certificate to such effect delivered to the Trustee
that shall specify all of the bases for such determination) the Special Servicer
has previously determined in accordance with the Servicing Standard, and based
on an Environmental Assessment of such Mortgaged Property performed within
twelve months prior to any such acquisition of title or other action (a copy of
which Environmental Assessment shall be delivered to the Trustee), that:
(i) the Mortgaged Property is in compliance with applicable
environmental laws and regulations or, if not, that it would
maximize the recovery to the Certificateholders on a present
value basis (the relevant discounting of anticipated collections
that will be distributable to Certificateholders to be performed
at the related Mortgage Rate) to acquire title to or possession
of the Mortgaged Property and to take such actions as are
necessary to bring the Mortgaged Property into compliance
therewith in all material respects; and
(ii) there are no circumstances or conditions present at the Mortgaged
Property relating to the use, management or disposal of Hazardous
Materials for which investigation, testing, monitoring,
containment, clean-up or remediation could be required under any
applicable environmental laws and regulations or, if such
circumstances or conditions are present for which any such action
could reasonably be expected to be required, that it would
maximize the recovery to the Certificateholders on a present
value basis (the relevant discounting of anticipated collections
that will be distributable to Certificateholders to be performed
at the related Mortgage Rate) to acquire title
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to or possession of the Mortgaged Property and to take such
actions with respect to the affected Mortgaged Property.
At the Special Servicer's request, pursuant to the procedures and
limitations set forth in Section 3.01, the Master Servicer shall advance the
cost of any Environmental Assessment, as well as the cost of any remedial,
corrective or other further action contemplated by clause (i) and/or clause (ii)
of the preceding paragraph pursuant to the procedures set forth in Section 3.01,
which costs may be reimbursed to the Master Servicer from the Certificate
Account as a Servicing Advance. In addition, if any Environmental Assessment so
warrants, the Special Servicer shall perform such additional environmental
testing as it deems necessary and prudent to determine whether the conditions
described in clauses (i) and (ii) of the preceding paragraph have been
satisfied. The Master Servicer shall also make a Servicing Advance, subject to
the limitations set forth in Section 3.01, of the cost of such additional
testing to the extent the Master Servicer is requested to make such Servicing
Advance by the Special Servicer pursuant to Section 3.01.
(d) If the environmental testing contemplated by Section 3.09(c) above
establishes that any of the conditions set forth in clauses (i) and (ii) has not
been satisfied with respect to any Mortgaged Property securing a defaulted
Mortgage Loan, the Special Servicer shall, subject to Section 6.11, take such
action as is in accordance with the Servicing Standard (other than proceeding
against the Mortgaged Property) and, at such time as it deems appropriate, may,
on behalf of the Trustee, release all or a portion of such Mortgaged Property
from the lien of the related Mortgage; provided that if such Mortgage Loan has a
then outstanding principal balance of greater than $1 million, prior to the
release of all or a portion of the related Mortgaged Property from the lien of
the related Mortgage, (i) the Special Servicer shall have notified the Rating
Agencies, Trustee and the Master Servicer in writing of its intention to so
release all or a portion of such Mortgaged Property and the bases for such
intention, (ii) the Trustee shall have notified the Certificateholders in
writing of the Special Servicer's intention to so release all or a portion of
such Mortgaged Property and (iii) the Holders of Certificates entitled to a
majority of the Voting Rights shall have consented to such release within 30
days of the Trustee's distributing such notice (failure to respond by the end of
such 30-day period being deemed consent).
(e) The Special Servicer shall report to the Master Servicer, the Trustee
and the Controlling Class Representative monthly in writing as to any actions
taken by the Special Servicer with respect to any Mortgaged Property that
represents security for a defaulted Mortgage Loan as to which the environmental
testing contemplated in Section 3.09(c) above has revealed that any of the
conditions set forth in clauses (A)(i) and (A)(ii) of the first sentence thereof
has not been satisfied, in each case until the earlier to occur of satisfaction
of all such conditions and release of the lien of the related Mortgage on such
Mortgaged Property.
(f) The Special Servicer shall have the right to determine, in accordance
with the Servicing Standard, the advisability of seeking to obtain a deficiency
judgment if the state in which the Mortgaged Property is located and the terms
of the Mortgage Loan permit
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such an action and shall, in accordance with the Servicing Standard, seek such
deficiency judgment if it deems advisable.
(g) The Special Servicer shall prepare and file information returns with
respect to the receipt of mortgage interest received in a trade or business, the
reports of foreclosures and abandonments of any Mortgaged Property and the
information returns relating to cancellation of indebtedness income with respect
to any Mortgaged Property required by Sections 6050H, 6050J and 6050P of the
Code and each year deliver to the Trustee and the Master Servicer an Officers'
Certificate stating that such reports have been filed. Such reports shall be in
form and substance sufficient to meet the reporting requirements imposed by
Sections 6050H, 6050J and 6050P of the Code.
(h) The Special Servicer shall maintain accurate records, prepared by a
Servicing Officer, of each Final Recovery Determination in respect of any
Specially Serviced Mortgage Loan or REO Property and the basis thereof. Each
Final Recovery Determination shall be evidenced by an Officers' Certificate
delivered to the Trustee, the Master Servicer and the Controlling Class
Representative no later than the third Business Day following such Final
Recovery Determination.
(i) Upon reasonable request of the Master Servicer, the Special Servicer
shall deliver to it and the related Sub-Servicer any other information and
copies of any other documents in its possession with respect to a Specially
Serviced Mortgage Loan or the related Mortgaged Property.
SECTION 3.10. Trustee and Custodian to Cooperate; Release of Mortgage
Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by the
Master Servicer of a notification that payment in full shall be escrowed in a
manner customary for such purposes, the Master Servicer shall promptly notify
the Trustee, who shall release or cause the related Custodian to release, by a
certification (which certification shall be in the form of a Request for Release
in the form of Exhibit D-1 attached hereto and shall be accompanied by the form
of a release or discharge and shall include a statement to the effect that all
amounts received or to be received in connection with such payment which are
required to be deposited in the Certificate Account pursuant to Section 3.04(a)
have been or will be so deposited) of a Servicing Officer (a copy of which
certification shall be delivered to the Special Servicer) and shall request
delivery to it of the related Mortgage File. Upon receipt of such certification
and request, the Trustee shall release, or cause any related Custodian to
release, the related Mortgage File to the Master Servicer and shall deliver to
the Master Servicer such release or discharge, duly executed. Ordinary and
reasonable expenses incurred in connection with any instrument of satisfaction
or deed of reconveyance shall not be chargeable to the Certificate Account or
the Distribution Account.
(b) If from time to time, and as appropriate for servicing or foreclosure
of any Mortgage Loan, the Master Servicer or the Special Servicer shall
otherwise require any
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Mortgage File (or any portion thereof), the Trustee, upon request of the Master
Servicer and receipt from the Master Servicer of a Request for Release in the
form of Exhibit D-1 attached hereto signed by a Servicing Officer thereof, or
upon request of the Special Servicer and receipt from the Special Servicer of a
Request for Release in the form of Exhibit D-2 attached hereto, shall release,
or cause any related Custodian to release, such Mortgage File (or portion
thereof) to the Master Servicer or the Special Servicer, as the case may be.
Upon return of such Mortgage File (or portion thereof) to the Trustee or related
Custodian, or the delivery to the Trustee of a certificate of a Servicing
Officer of the Special Servicer stating that such Mortgage Loan was liquidated
and that all amounts received or to be received in connection with such
liquidation that are required to be deposited into the Certificate Account
pursuant to Section 3.04(a) have been or will be so deposited, or that such
Mortgage Loan has become an REO Property, a copy of the Request for Release
shall be released by the Trustee or related Custodian to the Master Servicer or
the Special Servicer, as applicable.
(c) Within seven Business Days (or within such shorter period (but no less
than three Business Days) as execution and delivery can reasonably be
accomplished if the Special Servicer notifies the Trustee of an exigency) of the
Special Servicer's request therefor, the Trustee shall execute and deliver to
the Special Servicer (or the Special Servicer may execute and deliver in the
name of the Trustee based on a limited power of attorney issued in favor of the
Special Servicer pursuant to Section 3.01(b)), in the form supplied to the
Trustee, any court pleadings, requests for trustee's sale or other documents
reasonably necessary to the foreclosure or trustee's sale in respect of a
Mortgaged Property or REO Property or to any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or Mortgage or to obtain a
deficiency judgment, or to enforce any other remedies or rights provided by the
Mortgage Note or Mortgage or otherwise available at law or in equity or to
defend any legal action or counterclaim filed against the Trust Fund, the Master
Servicer or the Special Servicer. Together with such documents or pleadings, the
Special Servicer shall deliver to the Trustee a certificate of a Servicing
Officer requesting that such pleadings or documents be executed by the Trustee
and certifying as to the reason such documents or pleadings are required and
that the execution and delivery thereof by the Trustee will not invalidate or
otherwise affect the lien of the Mortgage, except for the termination of such a
lien upon completion of the foreclosure or trustee's sale.
SECTION 3.11. Servicing Compensation.
(a) As compensation for its activities hereunder, the Master Servicer shall
be entitled to receive the Servicing Fee with respect to each Mortgage Loan
(including each Specially Serviced Mortgage Loan) and REO Loan. As to each such
Mortgage Loan and REO Loan, the Servicing Fee shall accrue at the related
Servicing Fee Rate and on the same principal amount and for the same period
respecting which the related interest payment due on such Mortgage Loan or
deemed to be due on such REO Loan is computed. The Servicing Fee with respect to
any Mortgage Loan or REO Loan shall cease to accrue if a Liquidation Event
occurs in respect thereof. Earned but unpaid Servicing Fees shall be payable
monthly, on a loan-by-loan basis, from payments of interest on each Mortgage
Loan and REO Revenues allocable as interest on each REO Loan. The Master
Servicer shall be entitled to recover
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unpaid Servicing Fees in respect of any Mortgage Loan or REO Loan out of that
portion of related Insurance Proceeds or Liquidation Proceeds allocable as
recoveries of interest, to the extent permitted by Section 3.05(a)(iii) and
otherwise as permitted pursuant to Section 3.05(a) (vii). The right to receive
the Servicing Fee may not be transferred in whole or in part except in
connection with the transfer of all of the Master Servicer's responsibilities
and obligations under this Agreement.
(b) Additional servicing compensation in the form of assumption fees,
modification fees, late charges, exit fees or repayment fees, Penalty Interest,
charges for beneficiary statements or demands, amounts collected for checks
returned for insufficient funds and any similar fees (excluding Prepayment
Premiums), in each case to the extent actually paid by a Mortgagor with respect
to a Mortgage Loan that is not a Specially Serviced Mortgage Loan, may be
retained by the Master Servicer and are not required to be deposited in the
Certificate Account. The Master Servicer shall also be entitled to additional
servicing compensation in the form of (i) Prepayment Interest Excesses (but only
insofar as the aggregate of such Prepayment Interest Excesses collected during
any Collection Period exceeds the aggregate amount of Prepayment Interest
Shortfalls incurred during such Collection Period); (ii) interest or other
income earned on deposits in the Certificate Account, the Additional Interest
Distribution Account and the Distribution Account, in accordance with Section
3.06(b) (but only to the extent of the Net Investment Earnings, if any, with
respect to each such account for each Collection Period), and (iii) to the
extent not required to be paid to any Mortgagor under applicable law, any
interest or other income earned on deposits in the Servicing Accounts maintained
thereby. The Master Servicer shall be required to pay out of its own funds all
expenses incurred by it in connection with its servicing activities hereunder
(including, without limitation, payment of any amounts due and owing to any of
its Sub-Servicers and the premiums for any blanket policy insuring against
hazard losses pursuant to Section 3.07(b)), if and to the extent such expenses
are not payable directly out of the Certificate Account, and the Master Servicer
shall not be entitled to reimbursement therefor except as expressly provided in
this Agreement.
(c) As compensation for its activities hereunder, the Special Servicer
shall be entitled to receive the Special Servicing Fee with respect to each
Specially Serviced Mortgage Loan and each REO Loan. As to each Specially
Serviced Mortgage Loan and REO Loan, the Special Servicing Fee shall accrue from
time to time at the Special Servicing Fee Rate on the basis of the same
principal amount and for the same period respecting which any related interest
payment due on such Specially Serviced Mortgage Loan or deemed to be due on such
REO Loan is computed. The Special Servicing Fee with respect to any Specially
Serviced Mortgage Loan or REO Loan shall cease to accrue as of the date a
Liquidation Event occurs in respect thereof or it becomes a Corrected Mortgage
Loan. Earned but unpaid Special Servicing Fees shall be payable monthly out of
general collections on the Mortgage Loans and any REO Properties on deposit in
the Certificate Account pursuant to Section 3.05(a).
In addition, with respect to each Specially Serviced Mortgage Loan and REO
Loan, the Special Servicer shall be entitled to the Principal Recovery Fee
payable out of, and
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equal to 0.25% of, all amounts (whether in the form of payments, Insurance
Proceeds, Liquidation Proceeds or REO Revenues) received in respect of such
Mortgage Loan (or, in the case of an REO Loan, in respect of the related REO
Property) while such Mortgage Loan is a Specially Serviced Mortgage Loan and
allocable as a recovery of principal in accordance with Section 3.02(b) or the
definition of "REO Loan", as applicable; provided that if any such recovered
amounts are received within six months subsequent to the termination of the
previous Special Servicer, if any, and such termination was not the result of
resignation or termination by default pursuant to Sections 6.04 and 7.01,
respectively, then the successor Special Servicer shall pay to such terminated
Special Servicer a fraction of the Principal Recovery Fee earned by the
successor Special Servicer, the numerator of which is the number of days such
Specially Serviced Mortgage Loan or REO Loan was serviced by the terminated
Special Servicer and the denominator of which is the total number of days such
Specially Serviced Mortgage Loan or REO Loan was serviced prior to becoming a
Corrected Mortgage Loan or being liquidated, as applicable. Further, no
Principal Recovery Fee shall be payable in connection with, or out of
Liquidation Proceeds resulting from, the purchase of any Mortgage Loan or REO
Property by the applicable Mortgage Loan Seller pursuant to the respective
Mortgage Loan Purchase Agreement, by the Majority Subordinate Certificateholder
pursuant to Section 3.18(b), by the Master Servicer or the Special Servicer
pursuant to Section 3.18(c) or by the Master Servicer or the Depositor pursuant
to Section 9.01; provided further that if any Person is acting as Special
Servicer at such time as any Specially Serviced Mortgage Loan became a Corrected
Mortgage Loan and such Person is subsequently terminated as Special Servicer
hereunder, and if such Corrected Mortgage Loan was still a Corrected Mortgage
Loan at the time of such termination, then such Person shall, following such
termination, continue to be entitled to all Principal Recovery Fees payable in
respect to such Corrected Mortgage Loan, and no successor Special Servicer shall
be entitled to any Principal Recovery Fees payable in respect thereof, in either
case unless and until such Corrected Mortgage Loan again becomes a Specially
Serviced Mortgage Loan or becomes an REO Loan; and provided further that if any
Person is terminated as Special Servicer hereunder while the sale of any
Specially Serviced Mortgage Loan or REO Property is pending, then (subject to
the second preceding proviso) such Person shall be entitled to all, and the
successor Special Servicer shall be entitled to none, of the Principal Recovery
Fee payable in connection with the receipt of the Liquidation Proceeds derived
from such sale.
The Special Servicer's right to receive the Special Servicing Fee and
Principal Recovery Fee may not be transferred in whole or in part except in
connection with the transfer of all of the Special Servicer's responsibilities
and obligations under Sections 6.02, 6.04 and 6.09.
(d) Additional servicing compensation in the form of late charges,
assumption fees, modification fees, exit fees or repayment fees received on or
with respect to Specially Serviced Mortgage Loans shall be promptly paid to the
Special Servicer by the Master Servicer and shall not be required to be
deposited in the Certificate Account pursuant to Section 3.04(a). The Special
Servicer shall also be entitled to additional servicing compensation in the form
of: (i) interest or other income earned on deposits in the REO Account, if
established, in accordance with Section 3.06(b) (but only to the extent of the
Net
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Investment Earnings, if any, with respect to the REO Account for each Collection
Period); and (ii) to the extent not required to be paid to any Mortgagor under
applicable law, any interest or other income earned on deposits in the Servicing
Accounts maintained by the Special Servicer. The Special Servicer shall be
required to pay out of its own funds all expenses incurred by it in connection
with its servicing activities hereunder (including, without limitation, payment
of any amounts due and owing to any of its Sub-Servicers (other than
compensation) and the premiums for any blanket policy obtained by it insuring
against hazard losses pursuant to Section 3.07(b)), and the Special Servicer
shall be entitled to reimbursement therefor as expressly provided in Section
3.05(a) if and to the extent such expenses are not payable directly out of the
Certificate Account or the REO Account.
SECTION 3.12. Property Inspections; Collection of Financial Statements;
Delivery of Certain Reports.
(a) The Special Servicer shall (subject to its right to do so pursuant to
the related Mortgage) perform a physical inspection of a Mortgaged Property as
soon as practicable after a related Mortgage Loan becomes a Specially Serviced
Mortgage Loan. The Master Servicer shall at its expense perform an inspection of
each Mortgaged Property at least once per calendar year, if the Special Servicer
has not already done so in that calendar year pursuant to the preceding
sentence; provided, however, that the Master Servicer shall not be required to
perform such an inspection with respect to a Mortgaged Property in calendar year
1997 to the extent an inspection was previously performed in 1997 in connection
with the origination or acquisition of the related Mortgage Loan. The Master
Servicer or Special Servicer, as the case may be, shall prepare a written report
of each such inspection performed by it that sets forth in detail the condition
of the Mortgaged Property and that specifies the existence of: (i) any sale,
transfer or abandonment of the Mortgaged Property of which the Special Servicer
or Master Servicer, as applicable, is aware, (ii) any change in the condition or
value of the Mortgaged Property that it, in its reasonable judgment, considers
material, or (iii) any waste committed on the Mortgaged Property. Any such
reports prepared by the Special Servicer shall be promptly forwarded by it to
the Master Servicer. The Master Servicer and the Special Servicer shall make
copies of the inspection report of such Specially Serviced Mortgage Loan or REO
Property or non-Specially Serviced Mortgage Loan, as applicable, available for
review by Certificateholders during normal business hours at the offices of the
Master Servicer within 30 days of the completion of such inspection report (or
within 30 days of the Master Servicer's receipt of reports prepared by the
Special Servicer) but in no event later than 60 days after such physical
inspection.
The Special Servicer will, promptly after a Mortgage Loan becomes a
Specially Serviced Mortgage Loan, give written notice to the Master Servicer and
the Trustee which will include an explanation as to the reasons such Mortgage
Loan became a Specially Serviced Mortgage Loan and the Special Servicer's plan
for servicing such Mortgage Loan, a copy of which notice will be provided by the
Trustee to each Certificateholder, each Rating Agency, the Depositor and each
Underwriter.
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(b) The Special Servicer in the case of any Specially Serviced Mortgage
Loan, and the Master Servicer, in the case of all other Mortgage Loans, shall
make reasonable efforts to collect promptly from each related Mortgagor annual,
quarterly and monthly operating statements, budgets and rent rolls of the
related Mortgaged Property, and financial statements of such Mortgagor, to the
extent delivery of such items is required pursuant to the terms of the related
Mortgage. In addition, the Special Servicer shall cause annual operating
statements, budgets and rent rolls to be regularly prepared in respect of each
REO Property and shall collect all such items promptly following their
preparation. The Special Servicer shall deliver copies of all of the foregoing
items so collected thereby to the Trustee, the Master Servicer and any
Sub-Servicers, and the Master Servicer shall cause the same (including any items
collected by it) to be delivered, within ten days after its receipt thereof, to
the Trustee and the Trustee shall deliver the same to the Rating Agencies, and
upon request, to the Depositor, and the Controlling Class Representative (if
such Person is not then the Special Servicer). If requested by the Master
Servicer, the Special Servicer shall take reasonable steps to ensure that such
items present the information contained therein in substantially the same manner
as such information was presented when such items were collected by the
Depositor. Promptly following its receipt of the annual reports (but in no event
later than 45 days), the Master Servicer or the Special Servicer shall review
all such items as may be collected in respect of each Mortgage Loan and REO
Property and, in the absence of actual knowledge that any such item contains
erroneous information, shall be entitled to rely upon such information and based
upon such information shall: (i) calculate the occupancy percentage for the
related Mortgaged Property or REO Property, as the case may be (such occupancy
percentage shall represent a ratio of the number of rooms occupied per day
(summed over a specified period of time) to the number of rooms available for
occupancy per day (summed over such specified period of time) in the case of a
Mortgaged Property that is a hotel, shall be calculated on a per unit basis in
the case of a Mortgaged Property that is a multifamily rental property and on a
net square footage basis in all other cases or on any other basis that the
Master Servicer or the Special Servicer deems appropriate in accordance with the
Servicing Standard and identifies to the Trustee, the Master Servicer and the
Depositor); (ii) in accordance with Exhibit E-1, calculate the Net Operating
Income for the related Mortgaged Property or REO Property, as the case may be;
and (iii) calculate the Debt Service Coverage Ratio for the related Mortgage
Loan or REO Loan, as the case may be. The Updated Mortgage Loan Schedule to be
prepared each month by the Master Servicer pursuant to Section 3.12(c) shall
reflect the most recent calculations made by the Master Servicer or Special
Servicer pursuant to the preceding sentence with respect to each Mortgage Loan
and REO Loan and shall identify the period covered by the financial statements
and/or the date of the rent roll from which such calculations were made. All
information to be provided by the Special Servicer to the Master Servicer under
this Section shall be provided not later than five Business Days prior to the
date that the Master Servicer is required to deliver such information to the
Special Servicer, the Trustee, the Depositor, the Rating Agencies and the
Controlling Class Representative pursuant to Section 3.12(c).
(c) Not later than the fourth Business Day following each Determination
Date, the Master Servicer shall deliver to the Special Servicer, the Trustee,
the Depositor, the Controlling Class Representative and the Rating Agencies (for
receipt by the Special Servicer,
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the Trustee, the Depositor, the Controlling Class Representative and the Rating
Agencies not later than such fourth Business Day following each Determination
Date), by electronic transmission (or in such other form to which the Trustee,
the Depositor, the Master Servicer, the Special Servicer, the Controlling Class
Representative and the Rating Agencies may agree), with a hard copy of such
transmitted information to follow not later than the fifth Business Day
following such Determination Date, an accurate and complete Updated Mortgage
Loan Schedule, substantially in the form of Exhibit E-2, prepared as if the
Determination Date were the Cut-off Date and setting forth, among other things,
the items referred to in the definition of "Mortgage Loan Schedule", as well as
the items referred to in Section 3.12(b), further identifying on such schedule
each Mortgage Loan (i) that has become an REO Loan, and the date of the related
REO Acquisition, (ii) in respect of which any modification, waiver, or amendment
was agreed pursuant to Section 3.20 and the substance of such modification,
waiver or amendment, (iii) in respect of which a material event has occurred and
the nature of such material event, and (iv) that matured, prepaid in full or
(whether before or after an REO Acquisition) was otherwise liquidated during the
Collection Period ending on such Determination Date and, in each case,
specifying the date of the related maturity, prepayment or Liquidation Event,
the amount collected in connection therewith and the amount of any Realized Loss
and Trust Fund Expenses incurred in connection therewith. The Master Servicer
and the Special Servicer shall be entitled to indicate the source of any
information it provides pursuant to Section 3.12 and to affix any disclaimer it
deems appropriate in its discretion with respect to any information provided to
the Master Servicer or the Special Servicer by such source.
SECTION 3.13. Annual Statement as to Compliance.
Each of the Master Servicer and the Special Servicer shall deliver to the
Trustee, the Fiscal Agent and the Rating Agencies, and, in the case of the
Special Servicer, to the Master Servicer, on or before the 88th day following
the last Friday in December of each year, beginning March 24, 1998, an Officers'
Certificate stating, as to each signer thereof, that (i) a review of the
activities of the Master Servicer or the Special Servicer, as the case may be,
during the preceding calendar year and of its performance under this Agreement
has been made under such officer's supervision, (ii) to the best of such
officer's knowledge, based on such review, the Master Servicer or the Special
Servicer, as the case may be, has fulfilled all of its obligations under this
Agreement in all material respects throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such default
known to such officer and the nature and status thereof and (iii) the Master
Servicer or the Special Servicer, as the case may be, has received no notice
regarding qualification, or challenging the status, of any portion of the Trust
Fund as a REMIC from the Internal Revenue Service or any other governmental
agency or body or, if it has received any such notice, specifying the details
thereof. The Master Servicer and Special Servicer shall deliver a copy of such
Officer's Certificate to the Depositor.
SECTION 3.14. Reports by Independent Public Accountants.
On or before the 88th day following the last Friday in December of each
year, beginning March 24, 1998 each of the Master Servicer and the Special
Servicer at its expense
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shall cause a firm of Independent public accountants (which may also render
other services to the Master Servicer or the Special Servicer) that is a member
of the American Institute of Certified Public Accountants to furnish a statement
to the Trustee, to the Fiscal Agent, to the Rating Agencies, to the Depositor
and, in the case of the Special Servicer, to the Master Servicer to the effect
that such firm has examined the servicing operations of the Master Servicer or
the Special Servicer, as the case may be, for the previous calendar year (except
that the first such report shall cover the period from the Closing Date through
December 31, 1997) and that, on the basis of such examination, conducted
substantially in compliance with USAP, such firm confirms that the Master
Servicer or the Special Servicer, as the case may be, complied with the minimum
servicing standards identified in USAP, in all material respects, except for
such significant exceptions or errors in records that, in the opinion of such
firm, the USAP requires it to report. In rendering such statement, such firm may
rely, as to matters relating to direct servicing of mortgage loans by
Sub-Servicers, upon comparable statements for examinations conducted
substantially in compliance with the Uniform Single Audit Program for Mortgage
Bankers (rendered within one year of such statement) of independent public
accountants with respect to the related Sub-Servicer.
SECTION 3.15. Access to Certain Information.
Upon five Business Days prior written notice, the Trustee shall make
available at its offices, during normal business hours, for review by any
Certificateholder or any person identified to the Trustee, as the case may be,
as a prospective transferee of such an interest, the Fiscal Agent, the Rating
Agencies and the Depositor originals or copies of the following items, to the
extent such items are in the Trustee's possession: (a) this Agreement and any
amendments thereto, (b) all Distribution Date Statements delivered to holders of
the relevant Class of Certificates since the Closing Date, (c) all Officer's
Certificates delivered by the Master Servicer since the Closing Date, (d) all
accountants' reports delivered with respect to the Master Servicer and the
Special Servicer since the Closing Date as described in Section 3.14, (e) the
most recent property inspection report prepared by or on behalf of the Special
Servicer or the Master Servicer in respect of each Mortgaged Property pursuant
to Section 3.12(a) hereof, (f) the most recent Mortgaged Property annual
operating statements, financial statements and rent roll, if any, collected by
or on behalf of the Special Servicer or the Master Servicer pursuant to Section
3.12(b) hereof, together with the accompanying written reports to be prepared by
the Master Servicer or the Special Servicer, as the case may be, (g) any and all
modifications, waivers and amendments of the terms of a Mortgage Loan entered
into by the Special Servicer or the Master Servicer, (h) any and all Officers'
Certificates and other evidence delivered by the Master Servicer, the Special
Servicer, the Trustee or the Fiscal Agent, as the case may be, to support its
determination that any Advance was or, if made, would be a Nonrecoverable
Advance, (i) any and all notices and reports with respect to any Mortgaged
Property as to which the environmental testing contemplated by Section 3.09(c)
revealed that any of the conditions set forth in clauses (A) (i) and (A) (ii) of
the first sentence thereof was not satisfied, (j) all Updated Mortgage Loan
Schedules and Collection Reports since the Closing Date, and (k) in the case of
a Holder or prospective transferee of a Non-Registered Certificate, any private
placement memorandum or other disclosure document relating to the Certificates
of such Class, in the form most recently provided to the Trustee by
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the Depositor or by any person designated by the Depositor. Copies of any and
all of the foregoing items will be available from the Trustee, as the case may
be, upon request and shall be provided to any of the Rating Agencies, the
Depositor and the Controlling Class Representative at no cost pursuant to any of
their requests.
Each of the Master Servicer and the Special Servicer shall afford to the
Trustee, the Rating Agencies and the Depositor, and to the OTS, the FDIC and any
other banking or insurance regulatory authority that may exercise authority over
any Certificateholder, access to any records regarding the Mortgage Loans and
the servicing thereof within its control, except to the extent it is prohibited
from doing so by applicable law, license or contract or to the extent such
information is subject to a privilege under applicable law to be asserted on
behalf of the Certificateholders. Such access shall be afforded only upon
reasonable prior written request and during normal business hours at the offices
of the Master Servicer, the Special Servicer or any Sub-Servicer, as the case
may be, designated by it.
The Master Servicer, the Special Servicer or the Trustee, as applicable may
require payment from the requesting party (other than the Rating Agencies, the
Depositor and the Controlling Class Representative) of a sum sufficient to cover
the reasonable costs and expenses of providing any such information or access
pursuant to this Section 3.15 to, or at the request of, the Certificateholders
or prospective transferees, including, without limitation, copy charges and
reasonable fees for employee time and for space.
A Certificate Owner may obtain certain information contained in each
Distribution Date Statement by calling the Trustee's ASAP System at (312)
904-2200 and requesting statement number 259 or such other mechanism as the
Trustee may have in place from time to time. Account numbers on the Trustee's
ASAP System may be obtained by calling (312) 904-2200 and following the voice
prompts for obtaining account numbers. Separately, bond factor information may
be obtained from the Trustee by calling (800) 246-5761. In addition, if the
Depositor so directs the Trustee and on terms acceptable to the Trustee, the
Trustee will make available through its electronic bulletin board system on a
confidential basis, certain information related to the Mortgage Loans. The
bulletin board is located at (714) 282-3990. Those who have an account on the
bulletin board may retrieve the loan level data file for each transaction in the
directory. An account number may be obtained by typing "NEW" upon logging into
the bulletin board.
Upon written request of any Certificateholder of record made for purposes
of communicating with other Certificateholders with respect to their rights
under this Agreement, the Certificate Registrar will furnish such
Certificateholder with a list of the other Certificateholders then of record.
SECTION 3.16. Title to REO Property; REO Account.
(a) If title to any REO Property is acquired, the deed or certificate of
sale shall be issued to the Trustee on behalf of the Certificateholders. The
Special Servicer, on behalf of the Trust Fund, shall sell any REO Property
within two years after REMIC I acquires ownership of such REO Property for
purposes of Section 860G(a)(8) of the Code,
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unless the Special Servicer either (i) applies, more than sixty days prior to
the expiration of such two year period, and is granted an extension of time (an
"REO Extension") by the Internal Revenue Service to sell such REO Property or
(ii) obtains for the Trustee an Opinion of Counsel, addressed to the Trustee,
the Special Servicer and the Master Servicer, to the effect that the holding by
REMIC I of such REO Property subsequent to the second anniversary of such
acquisition will not result in the imposition of taxes on "prohibited
transactions" (as defined in Section 860F of the Code) of any of REMIC I, REMIC
II or REMIC III or cause any of REMIC I, REMIC II or REMIC III to fail to
qualify as a REMIC at any time that any Certificates are outstanding. If the
Special Servicer is granted the REO Extension contemplated by clause (i) of the
immediately preceding sentence or obtains the Opinion of Counsel contemplated by
clause (ii) of the immediately preceding sentence, the Special Servicer shall
sell such REO Property within such extended period as is permitted by such REO
Extension or such Opinion of Counsel, as the case may be. Any expense incurred
by the Special Servicer in connection with its obtaining the REO Extension
contemplated by clause (i) of the second preceding sentence or its obtaining the
Opinion of Counsel contemplated by clause (ii) of the second preceding sentence,
shall be an expense of the Trust Fund payable out of the Certificate Account
pursuant to Section 3.05(a).
(b) The Special Servicer shall segregate and hold all funds collected and
received in connection with any REO Property separate and apart from its own
funds and general assets. If an REO Acquisition shall occur, the Special
Servicer shall establish and maintain one or more accounts (collectively, the
"REO Account"), held on behalf of the Trustee in trust for the benefit of the
Certificateholders, for the retention of revenues and other proceeds derived
from each REO Property. The REO Account shall be an Eligible Account. The
Special Servicer shall deposit, or cause to be deposited, in the REO Account,
upon receipt, all REO Revenues, Insurance Proceeds and Liquidation Proceeds
received in respect of an REO Property. Funds in the REO Account may be invested
in Permitted Investments in accordance with Section 3.06. The Special Servicer
shall be entitled to make withdrawals from the REO Account to pay itself, as
additional servicing compensation in accordance with Section 3.11(d), interest
and investment income earned in respect of amounts held in the REO Account as
provided in Section 3.06(b) (but only to the extent of the Net Investment
Earnings with respect to the REO Account for any Collection Period). The Special
Servicer shall give notice to the Trustee and the Master Servicer of the
location of the REO Account when first established and of the new location of
the REO Account prior to any change thereof.
(c) The Special Servicer shall withdraw from the REO Account funds
necessary for the proper operation, management, maintenance and disposition of
any REO Property, but only to the extent of amounts on deposit in the REO
Account relating to such REO Property (including any monthly reserve or escrow
amounts necessary to accumulate sufficient funds for taxes, insurance and
anticipated capital expenditures (the "Impound Reserve")). On each Determination
Date, the Special Servicer shall withdraw from the REO Account and deposit into
the Certificate Account or deliver to the Master Servicer (which shall deposit
such amounts into the Certificate Account) the aggregate of all amounts received
in respect of each REO Property during the most recently ended Collection
Period, net of any
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withdrawals made out of such amounts pursuant to the preceding sentence;
provided that in addition to the Impound Reserve the Special Servicer may retain
in the REO Account such portion of proceeds and collections as may be necessary
to maintain a reserve of sufficient funds for the proper operation, management
and maintenance of the related REO Property (including without limitation the
creation of a reasonable reserve for repairs, replacements and other related
expenses), such reserve not to exceed $10,000 with respect to each such REO
Property or to cover a period of more than twelve months.
(d) The Special Servicer shall keep and maintain separate records, on a
property-by-property basis, for the purpose of accounting for all deposits to,
and withdrawals from, the REO Account pursuant to Section 3.16(b) or (c). The
Special Servicer shall provide the Master Servicer any information with respect
to the REO Account as is reasonably requested by the Master Servicer.
SECTION 3.17. Management of REO Property.
(a) Prior to the acquisition of title to a Mortgaged Property, the Special
Servicer shall review the operation of such Mortgaged Property and determine the
nature of the income that would be derived from such property if it were
acquired by the Trust Fund. If the Special Servicer determines that:
(i) none of the income from Directly Operating such Mortgaged Property
would be subject to tax as "net income from foreclosure property" within
the meaning of the REMIC Provisions or would be subject to the tax imposed
on "prohibited transactions" under Section 860F of the Code (either such
tax referred to herein as an "REO Tax"), such Mortgaged Property may be
Directly Operated by the Special Servicer as REO Property;
(ii) Directly Operating such Mortgaged Property as an REO Property
could result in income from such property that would be subject to an REO
Tax, but that a lease of such property to another party to operate such
property, or the performance of some services by an Independent Contractor
with respect to such property, or another method of operating such property
would not result in income subject to an REO Tax, then the Special Servicer
may (provided, that in the good faith and reasonable judgment of the
Special Servicer, it is commercially reasonable) acquire such Mortgaged
Property as REO Property and so lease or operate such REO Property; or
(iii) it is reasonable to believe that Directly Operating such
property as REO Property could result in income subject to an REO Tax and
that no commercially reasonable means exists to operate such property as
REO Property without the Trust Fund incurring or possibly incurring an REO
Tax on income from such property, the Special Servicer shall deliver to the
REMIC Administrator, in writing, a proposed plan (the "Proposed Plan") to
manage such property as REO Property. Such plan shall include potential
sources of
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income, and to the extent commercially reasonable, estimates of the amount
of income from each such source. Within a reasonable period of time after
receipt of such plan, the REMIC Administrator shall consult with the
Special Servicer and shall advise the Special Servicer of the REMIC
Administrator's federal income tax reporting position with respect to the
various sources of income that the Trust Fund would derive under the
Proposed Plan. In addition, the REMIC Administrator shall (to the extent
possible) advise the Special Servicer of the estimated amount of taxes that
the Trust Fund would be required to pay with respect to each such source of
income. After receiving the information described in the two preceding
sentences from the REMIC Administrator, the Special Servicer shall either
(A) implement the Proposed Plan (after acquiring the respective Mortgaged
Property as REO Property) or (B) manage and operate such property in a
manner that would not result in the imposition of an REO Tax on the income
derived from such property. The Special Servicer's decision as to how each
REO Property shall be managed and operated shall be based in either case on
the good faith and reasonable judgment of the Special Servicer as to which
means would be in the best interest of the Certificateholders by maximizing
(to the extent commercially feasible) the net after-tax REO Revenues
received by the Trust Fund with respect to such property and, to the extent
consistent with the foregoing, in accordance with the Servicing Standard.
Both the Special Servicer and the REMIC Administrator may, at the expense
of the Trust Fund payable pursuant to Section 3.05(a)(xiii) consult with
counsel with respect to the determinations required under this Section
3.17(a). Neither the Special Servicer nor the REMIC Administrator shall be
liable to the Certificateholders, the Trust Fund, the Trustee, the Master
Servicer or each other for errors in judgment made in good faith in the
exercise of their discretion while performing their respective
responsibilities under this Section 3.17(a). Nothing in this Section
3.17(a) is intended to prevent the sale of a Defaulted Mortgage Loan
pursuant to the terms and subject to the conditions of Section 3.18.
(b) Subject to Section 3.17(a)(iii), if title to any REO Property is
acquired, the Special Servicer shall manage, conserve, protect and operate such
REO Property for the benefit of the Certificateholders solely for the purpose of
its prompt disposition and sale in a manner that does not and will not cause
such REO Property to fail to qualify as "foreclosure property" within the
meaning of Section 860G(a)(8) of the Code, except as contemplated by Section
3.17(a), or result in the receipt by REMIC I, REMIC II or REMIC III of any
"income from nonpermitted assets" within the meaning of Section 860F(a)(2)(B) of
the Code or result in an Adverse REMIC Event. Subject to the foregoing, however,
the Special Servicer shall have full power and authority to do any and all
things in connection therewith as are consistent with the Servicing Standard
and, consistent therewith, shall withdraw from the REO Account, to the extent of
amounts on deposit therein with respect to any REO Property, funds necessary for
the proper operation, management, maintenance and disposition of such REO
Property, including without limitation:
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(i) all insurance premiums due and payable in respect of such REO
Property;
(ii) all real estate taxes and assessments in respect of such REO
Property that may result in the imposition of a lien thereon;
(iii) any ground rents in respect of such REO Property; and
(iv) all costs and expenses necessary to maintain, lease, sell,
protect, manage, operate and restore such REO Property.
To the extent that amounts on deposit in the REO Account in respect of any REO
Property are insufficient for the purposes set forth in clauses (i)-(iv) above
with respect to such REO Property, the Master Servicer shall, pursuant to the
procedures and limitations set forth in Section 3.01, make Servicing Advances in
such amounts as are necessary for such purposes unless (as evidenced by an
Officers' Certificate delivered to the Trustee and the Master Servicer) the
Master Servicer would not make such advances if the Master Servicer owned such
REO Property or the Master Servicer determines, in accordance with the Servicing
Standard, that such payment would be a Nonrecoverable Advance; provided,
however, that the Master Servicer may make any such Servicing Advance without
regard to recoverability if it is a necessary fee or expense incurred in
connection with the defense or prosecution of legal proceedings.
(c) The Special Servicer may contract with any Independent Contractor for
the operation and management of any REO Property, provided that:
(i) the terms and conditions of any such contract may not be
inconsistent herewith and shall reflect an agreement reached at arm's
length;
(ii) the fees of such Independent Contractor (which shall be expenses
of the Trust Fund) shall be reasonable and customary in consideration of
the nature and locality of the REO Property;
(iii) except as permitted under Section 3.17(a), any such contract
shall require, or shall be administered to require, that the Independent
Contractor, in a timely manner, (A) pay all costs and expenses incurred in
connection with the operation and management of such REO Property,
including, without limitation, those listed in Section 3.17(b) above, and
(B) except to the extent that such revenues are derived from any services
rendered by the Independent Contractor to tenants of the REO Property that
are not customarily furnished or rendered in connection with the rental of
real property (within the meaning of Section 1.856-4(b)(5) of the Treasury
Regulations or any successor provision), remit all related revenues
collected (net of its fees and such costs and expenses) to the Special
Servicer upon receipt;
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(iv) none of the provisions of this Section 3.17(c) relating to any
such contract or to actions taken through any such Independent Contractor
shall be deemed to relieve the Special Servicer of any of its duties and
obligations hereunder with respect to the operation and management of any
such REO Property; and
(v) the Special Servicer shall be obligated with respect thereto to
the same extent as if it alone were performing all duties and obligations
in connection with the operation and management of such REO Property.
The Special Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of the Special Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify such indemnification. No agreement entered into pursuant to this
Section 3.17(c) shall be deemed a Sub-Servicing Agreement for purposes of
Section 3.22.
SECTION 3.18. Sale of Mortgage Loans and REO Properties.
(a) The Master Servicer, the Special Servicer or the Trustee may sell or
purchase, or permit the sale or purchase of, a Mortgage Loan or REO Property
only on the terms and subject to the conditions set forth in this Section 3.18
or as otherwise expressly provided in or contemplated by Sections 2.03(a) and
9.01.
(b) Subject to Section 2.03(a), if the Special Servicer has determined in
good faith that any Defaulted Mortgage Loan will become subject to foreclosure
proceedings, the Special Servicer shall promptly so notify in writing the
Trustee and the Master Servicer, and the Trustee, following its receipt of such
notice, shall, within 10 days after receipt of such notice, deliver a copy of
such notice to the Majority Subordinate Certificateholder. The Majority
Subordinate Certificateholder may at its option purchase from the Trust Fund, at
a price equal to the Purchase Price, any such Mortgage Loan. The Purchase Price
for any Mortgage Loan purchased under this paragraph (b) shall be deposited into
the Certificate Account, and the Custodian, upon receipt of an Officers'
Certificate from the Master Servicer to the effect that such deposit has been
made, shall release or cause to be released to the Majority Subordinate
Certificateholder the related Mortgage File, and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as shall
be provided to it and are reasonably necessary to vest in the Majority
Subordinate Certificateholder ownership of such Mortgage Loan. In connection
with any such purchase, the Special Servicer shall deliver the related Servicing
File to the Majority Subordinate Certificateholder.
(c) If the Majority Subordinate Certificateholder has not purchased any
Defaulted Mortgage Loan within 30 days of its having received notice in respect
thereof pursuant to Section 3.18(b) above, either the Master Servicer or the
Special Servicer (with preference given to the Master Servicer) may at its
option purchase such Mortgage Loan from
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the Trust Fund, at a price equal to the Purchase Price. The Purchase Price for
any such Mortgage Loan purchased under this paragraph (c) shall be deposited
into the Certificate Account, and the Custodian, upon receipt of an Officers'
Certificate from the Master Servicer to the effect that such deposit has been
made, shall release or cause to be released to the Master Servicer or the
Special Servicer, as applicable, the related Mortgage File, and shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, as shall be provided to it and are reasonably necessary to vest in the
Master Servicer or the Special Servicer, as applicable, the ownership of such
Mortgage Loan. In connection with any such purchase by the Master Servicer, the
Special Servicer shall deliver the related Servicing File to the Master
Servicer.
(d) The Special Servicer may, subject to Section 6.11, offer to sell any
Defaulted Mortgage Loan not otherwise purchased pursuant to Sections 3.18(b) and
3.18(c) above, if and when the Special Servicer determines, consistent with the
Servicing Standard, that such a sale would be in the best economic interests of
the Trust Fund. Such offer shall be made in a commercially reasonable manner
(which, for purposes hereof, includes an offer to sell without representation or
warranty other than customary warranties of title and condition, if liability
for breach thereof is limited to recourse against the Trust Fund) for a period
of not less than 10 days. Unless the Special Servicer determines that acceptance
of any bid would not be in the best economic interests of the Trust Fund, the
Special Servicer shall accept the highest cash bid received from any Person that
constitutes a fair price for such Mortgage Loan. In the absence of any bid
determined as provided below to be fair, the Special Servicer shall proceed with
respect to such Defaulted Mortgage Loan in accordance with Section 3.09.
The Special Servicer shall, subject to Section 6.11, use its best efforts
to solicit bids for each REO Property in such manner as will be reasonably
likely to realize a fair price within the time period provided for by Section
3.16(a). The Special Servicer shall accept the first (and, if multiple bids are
received contemporaneously, the highest) cash bid received from any Person that
constitutes a fair price for such REO Property. If the Special Servicer
reasonably believes that it will be unable to realize a fair price for any REO
Property within the time constraints imposed by Section 3.16(a), the Special
Servicer shall dispose of such REO Property upon such terms and conditions as
the Special Servicer shall deem necessary and desirable to maximize the recovery
thereon under the circumstances and, in connection therewith, shall accept the
highest outstanding cash bid, regardless of from whom received.
The Special Servicer shall give the Trustee and the Master Servicer not
less than three Business Days' prior written notice of its intention to sell any
Mortgage Loan or REO Property pursuant to this Section 3.18(d). No Interested
Person shall be obligated to submit a bid to purchase any such Mortgage Loan or
REO Property, and notwithstanding anything to the contrary herein, neither the
Trustee, in its individual capacity, nor any of its Affiliates may bid for or
purchase any Defaulted Mortgage Loan or any REO Property pursuant hereto.
(e) Whether any cash bid constitutes a fair price for any Defaulted
Mortgage Loan or REO Property, as the case may be, for purposes of Section
3.18(d), shall be determined by the Special Servicer (except as otherwise
provided below in this Section
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3.18(e)). In determining whether any bid received from an Interested Person
represents a fair price for any such Mortgage Loan or REO Property, the Special
Servicer shall be supplied with and may rely on a narrative appraisal prepared
at the expense of the Trust Fund by an Independent Appraiser, retained by the
Special Servicer. (The Special Servicer may rely on a certification of any
bidder to the effect that such bidder is not an Interested Person.) Such
appraiser shall be selected by the Special Servicer if the Special Servicer is
not bidding with respect to a Defaulted Mortgage Loan or REO Property and shall
be selected by the Master Servicer if the Special Servicer is bidding. (The
Special Servicer shall not bid with respect to a Defaulted Mortgage Loan or REO
Property if the Master Servicer has informed it that the Master Servicer intends
to submit a bid.) Where any Interested Person is among those bidding with
respect to a Mortgage Loan or REO Property, the Special Servicer shall require
that all bids be submitted in writing and be accompanied by a refundable deposit
of cash in an amount equal to 5% of the bid amount. In determining whether any
bid from a Person other than an Interested Person or from an Interested Person
other than the Special Servicer constitutes a fair price for any such Mortgage
Loan or REO Property, the Special Servicer shall take into account (in addition
to the results of any appraisal described above and any appraisal that it may
have obtained pursuant to Section 3.09(a)), and any appraiser or other expert in
real estate matters shall be instructed to take into account, as applicable,
among other factors, the period and amount of any delinquency on the affected
Mortgage Loan, the occupancy level and physical condition of the Mortgaged
Property or REO Property, the state of the local economy and the obligation to
dispose of any REO Property within the time period specified in Section 3.16(a).
The Purchase Price for any such Mortgage Loan or REO Property shall in all cases
be deemed a fair price. Notwithstanding the other provisions of this Section
3.18 (but excluding a purchase pursuant to Section 3.18(c)), no cash bid from
the Master Servicer, Special Servicer or any of their Affiliates thereof shall
constitute a fair price for any Defaulted Mortgage Loan or REO Property unless
such bid is the highest bid received and at least two independent bids (not
including the bid of the Special Servicer or any Affiliate) have been received.
In the event the bid of the Special Servicer or any Affiliate is the only bid
received or is the higher of only two bids received, then additional bids shall
be solicited. If an additional bid or bids are received and the original bid of
the Special Servicer or any Affiliate is the highest of all bids received, then
the bid of the Special Servicer or such Affiliate shall be deemed to constitute
a fair price.
(f) Subject to Sections 3.18(a) through 3.18(e) above, the Special Servicer
shall act on behalf of the Trustee in negotiating and taking any other action
necessary or appropriate in connection with the sale of any Defaulted Mortgage
Loan or REO Property, and the collection of all amounts payable in connection
therewith. In connection therewith, the Special Servicer may charge prospective
bidders, and may retain, fees that approximate the Special Servicer's actual
costs in the preparation and delivery of information pertaining to such sales or
evaluating bids without obligation to deposit such amounts into the Certificate
Account. Any sale of a Defaulted Mortgage Loan or any REO Property shall be
final, without recourse to the Trustee or the Trust Fund (other than limited
warranty of title and condition) and without representations and warranties, and
if such sale is consummated in accordance with the terms of this Agreement,
neither the Special Servicer nor the Trustee shall have any
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liability to any Certificateholder with respect to the purchase price therefor
accepted by the Special Servicer or the Trustee.
(g) Any sale of a Defaulted Mortgage Loan or any REO Property shall be for
cash only (unless changes in the REMIC Provisions or authoritative
interpretations thereof made or issued subsequent to the Startup Day allow a
sale for other consideration).
(h) The Special Servicer shall not be obligated by any of the foregoing
paragraphs of this Section 3.18 to accept the highest bid if the Special
Servicer determines, in accordance with the Servicing Standard, that rejection
of such bid would be in the best interests of the Certificateholders. In
addition, the Special Servicer may accept a lower bid if it determines, in
accordance with the Servicing Standard, that acceptance of such bid would be in
the best interests of the Certificateholders (for example, if the prospective
buyer making the lower bid is more likely to perform its obligations or the
terms offered by the prospective buyer making the lower bid are more favorable).
SECTION 3.19. Additional Obligations of Master Servicer.
The Master Servicer shall deliver to the Paying Agent for deposit in the
Distribution Account on each P&I Advance Date, without any right of
reimbursement therefor, an amount equal to the lesser of (i) the excess, if any,
of (A) aggregate amount of Prepayment Interest Shortfalls incurred in connection
with Principal Prepayments received during the most recently ended Collection
Period over (B) the aggregate amount of Prepayment Interest Excesses collected
in connection with Principal Prepayments received during such Collection Period,
and (ii) the total amount of servicing compensation received by the Master
Servicer during such Collection Period; provided, however, that in determining
servicing compensation of the initial Master Servicer for purposes of this
Section 3.19, with respect to each Mortgage Loan for which the initial Master
Servicer has received the Scheduled Payment for the related Due Date, the
initial Master Servicer shall be deemed to have received a Servicing Fee
computed based upon the Imputed Servicing Fee Rate.
SECTION 3.20. Modifications, Waivers, Amendments and Consents.
(a) Subject to Sections 3.20(b) through 3.20(h) below and Section 6.11, the
Master Servicer or Special Servicer may, on behalf of the Trustee, agree to any
modification, waiver or amendment of any term of any Mortgage Loan without the
consent of the Trustee or any Certificateholder.
(b) All modifications, waivers or amendments of any Mortgage Loan shall be
in writing and shall be considered and effected in accordance with the Servicing
Standard.
(c) With respect to Mortgage Loans which are not Specially Serviced
Mortgage Loans, the Master Servicer, on behalf of the Trustee, shall not agree
or consent to any modification, waiver or amendment of any term of any such
Mortgage Loan if such modification, waiver or amendment would:
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(i) affect the amount or timing of any related payment of principal,
interest or other amount (including Prepayment Premiums, but excluding
Penalty Interest and other amounts payable as additional servicing
compensation) payable thereunder;
(ii) affect the obligation of the related Mortgagor to pay a
Prepayment Premium or permit a Principal Prepayment during any period in
which the related Mortgage Note prohibits Principal Prepayments;
(iii) except as expressly contemplated by the related Mortgage or
pursuant to Section 3.09(d), result in a release of the lien of the
Mortgage on any material portion of the related Mortgaged Property without
a corresponding Principal Prepayment in an amount not less than the fair
market value (as determined by an Appraisal by an Independent Appraiser
delivered to the Master Servicer at the expense of the related Mortgagor
and upon which the Master Servicer may conclusively rely) of the property
to be released; or
(iv) in the judgment of the Master Servicer, otherwise materially
impair the security for such Mortgage Loan or reduce the likelihood of
timely payment of amounts due thereon.
(d) Notwithstanding any provision of this Agreement to the contrary,
neither the Master Servicer nor the Special Servicer shall consent to, make or
permit (i) any modification with respect to any Mortgage Loan that would change
the Mortgage Rate or Additional Interest Rate, reduce or increase the principal
balance (except for reductions resulting from actual payments of principal) or
change the final maturity date of such Mortgage Loan unless, with respect to a
Specially Serviced Mortgage Loan both (A) the related Mortgagor is in default
with respect to the Mortgage Loan or, in the judgment of the Special Servicer,
such default is reasonably foreseeable and (B) in the sole good faith judgment
of the Special Servicer, such modification would increase the recovery on the
Mortgage Loan to Certificateholders on a present value basis (the relevant
discounting of amounts that will be distributable to Certificateholders to be
performed at the related Mortgage Rate) or (ii) any modification, waiver or
amendment of any term of any Mortgage Loan that would either (A) effect an
exchange or reissuance of such Mortgage Loan under Section 1001 of the Code (and
the Treasury Regulations promulgated thereunder with an effective date or
proposed effective date that applies or would apply to such waiver, modification
or amendment) or (B) cause REMIC I, REMIC II or REMIC III to fail to qualify as
a REMIC under the Code or result in the imposition of any tax on "prohibited
transactions" or "contributions" after the Startup Day under the REMIC
Provisions.
However, the Special Servicer will not be permitted to extend the date on
which any Balloon Payment is scheduled to be due unless the Special Servicer has
obtained an Appraisal of the related Mortgaged Property, which Appraisal
supports the determination of the Special Servicer contemplated by clause (i)(B)
of the immediately preceding paragraph. In no event shall the scheduled due date
for a Balloon Payment be extended for a period in excess
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of 12 months per extension or 36 months in the aggregate, without the consent of
the Extension Adviser pursuant to Section 3.24 herein, and in no event shall the
Special Servicer be permitted to extend the date on which any Balloon Payment is
due beyond June 18, 2027.
The determination of the Special Servicer contemplated by clause (i)(B) of
the first paragraph of this Section 3.20(d) shall be evidenced by an Officer's
Certificate to such effect delivered to the Trustee, the Controlling Class
Representative and the Master Servicer and describing in reasonable detail the
basis for the Special Servicer's determination.
(e) Any payment of interest that is deferred pursuant to any modification,
waiver or amendment permitted hereunder, shall not, for purposes hereof,
including, without limitation, calculating monthly distributions to
Certificateholders, be added to the unpaid principal balance of the related
Mortgage Loan, notwithstanding that the terms of such modification, waiver or
amendment so permit. The foregoing shall in no way limit the Master Servicer's
or Special Servicer's ability to charge and collect from the Mortgagor such
costs together with interest thereon.
(f) The Master Servicer or Special Servicer may, as a condition to granting
any request by a Mortgagor for consent, modification, waiver or indulgence or
any other matter or thing, the granting of which is within its discretion
pursuant to the terms of the instruments evidencing or securing the related
Mortgage Loan and is permitted by the terms of this Agreement, require that such
Mortgagor pay to it (i) as additional servicing compensation, a reasonable or
customary fee for the additional services performed in connection with such
request, and (ii) any related costs and expenses incurred by it. In no event
shall the Master Servicer or Special Servicer be entitled to payment for such
fees or expenses unless such payment is collected from the related Mortgagor.
(g) The Master Servicer or Special Servicer (with respect to Specially
Serviced Mortgage Loans) shall notify the Master Servicer, the Controlling Class
Representative, any related Sub-Servicers and the Trustee, in writing, of any
modification, waiver or amendment of any term of any Mortgage Loan (including
fees charged the Mortgagor) and the date thereof, and shall deliver to the
Custodian for deposit in the related Mortgage File, an original counterpart of
the agreement relating to such modification, waiver or amendment, promptly (and
in any event within ten Business Days) following the execution thereof. Copies
of each agreement whereby any such modification, waiver or amendment of any term
of any Mortgage Loan is effected shall be made available for review upon prior
request during normal business hours at the offices of the Trustee pursuant to
Section 3.15(g) hereof.
(h) If, with respect to any Defeasance Loan, the Master Servicer shall
receive a notice from the related Mortgagor that it intends to prepay the
related Defeasance Loan in accordance with the terms thereof, except as set
forth below, the Master Servicer shall (a) promptly respond to such notice in a
manner which would require that the Mortgagor pledge Defeasance Collateral in
lieu of such prepayment pursuant to the terms of the related Mortgage Note, (b)
notify each Rating Agency, the Trustee and the Underwriters of the
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request to defease a Mortgage Loan and (c) upon the written confirmation from
each Rating Agency described in the next paragraph, take such further action as
provided in such Mortgage Note to effectuate such pledge, including the purchase
and perfection of the Defeasance Collateral in the name of the Trustee, as
trustee for the registered holders of Merrill Lynch Mortgage Investors, Inc.,
Mortgage Pass-Through Certificates, Series 1997-C1.
Notwithstanding the above, the Master Servicer shall not permit a pledge of
Defeasance Collateral in lieu of prepayment under a Defeasance Loan if (i) such
defeasance would occur within two years of the Startup Day, (ii) such Defeasance
Loan (or any applicable agreement executed in connection with the related
defeasance) provides that the Mortgagor will be liable for any shortfalls from
the Defeasance Collateral or otherwise become subjected to recourse liability
with respect to the Defeasance Loan, (iii) such defeasance would result in a new
Mortgagor on the Defeasance Loan (unless such new Mortgagor is acquiring the
Mortgaged Property that was the initial security for the Mortgage Loan), or (iv)
any Rating Agency does not confirm in writing to the Master Servicer that the
acceptance of a pledge of the Defeasance Collateral in lieu of a full prepayment
will not result in a downgrade, withdrawal or qualification of the ratings then
assigned by it to any Class of Certificates.
SECTION 3.21. Transfer of Servicing Between Master Servicer and Special
Servicer; Record Keeping.
(a) Upon determining that a Servicing Transfer Event has occurred with
respect to any Mortgage Loan and if the Master Servicer is not also the Special
Servicer, the Master Servicer shall immediately give notice thereof, and shall
deliver a copy of the related Servicing File, to the Special Servicer and shall
use reasonable efforts to provide the Special Servicer with all information,
documents (or copies thereof) and records (including records stored
electronically on computer tapes, magnetic discs and the like) relating to the
Mortgage Loan either in the Master Servicer's or any of its directors',
officers', employees', affiliates' or agents' possession or control or otherwise
available to the Master Servicer without undue burden or expense, and reasonably
requested by the Special Servicer to enable it to assume its functions hereunder
with respect thereto without acting through a Sub-Servicer. The Master Servicer
shall use reasonable efforts to comply with the preceding sentence within five
Business Days of the occurrence of each related Servicing Transfer Event;
provided, however, if the information, documents and records requested by the
Special Servicer are not contained in the Servicing File, the Master Servicer
shall have such period of time as reasonably necessary to make such delivery.
Upon determining that a Specially Serviced Mortgage Loan has become a
Corrected Mortgage Loan and if the Master Servicer is not also the Special
Servicer, the Special Servicer shall immediately give notice thereof, and shall
return the related Servicing File and all other information, documents and
records that were not part of the Servicing File when it was delivered to the
Special Servicer within five Business Days of the occurrence, to the Master
Servicer (or such other Person as may be directed by the Master Servicer) and
upon giving such notice, and returning such Servicing File, to the Master
Servicer (or such other Person as may be directed by the Master Servicer), the
Special Servicer's obligation to
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service such Mortgage Loan, and the Special Servicer's right to receive the
Special Servicing Fee with respect to such Mortgage Loan, shall terminate, and
the obligations of the Master Servicer to service and administer such Mortgage
Loan shall resume.
(b) In servicing any Specially Serviced Mortgage Loans, the Special
Servicer shall provide to the Custodian originals of documents included within
the definition of "Mortgage File" for inclusion in the related Mortgage File
(with a copy of each such original to the Master Servicer), and copies of any
additional related Mortgage Loan information, including correspondence with the
related Mortgagor.
(c) On or before each Determination Date, the Special Servicer shall
deliver to the Master Servicer (or such other Person as may be directed by the
Master Servicer) a statement in writing and in computer readable format (the
form of such statement to be agreed upon by the Master Servicer) describing, on
a loan-by-loan and property-by-property basis, (1) insofar as it relates to
Specially Serviced Mortgage Loans and REO Properties, the information described
in clauses (x) through (xiv) of Section 4.02(a) and, insofar as it relates to
the Special Servicer, the information described in clauses (xxv) and (xxvi) of
Section 4.02(a), (2) the amount of all payments, Insurance Proceeds and
Liquidation Proceeds received, and the amount of any Realized Loss incurred,
with respect to each Specially Serviced Mortgage Loan during the related
Collection Period, and the amount of all REO Revenues, Insurance Proceeds and
Liquidation Proceeds received, and the amount of any Realized Loss incurred,
with respect to each REO Property during the related Collection Period, (3) the
amount, purpose and date of all Servicing Advances made by the Master Servicer
with respect to each Specially Serviced Mortgage Loan and REO Property during
the related Collection Period and (4) such additional information relating to
the Specially Serviced Mortgage Loans and REO Properties as the Master Servicer
reasonably requests to enable it to perform its responsibilities under this
Agreement. Notwithstanding the foregoing provisions of this subsection (c), the
Master Servicer shall maintain ongoing payment records with respect to each of
the Specially Serviced Mortgage Loans and REO Properties and shall provide the
Special Servicer with any information reasonably available to the Master
Servicer required by the Special Servicer to perform its duties under this
Agreement.
SECTION 3.22. Sub-Servicing Agreements.
(a) The Master Servicer and the Special Servicer may enter into
Sub-Servicing Agreements to provide for the performance by third parties of any
or all of their respective obligations hereunder, provided that, in each case,
the Sub-Servicing Agreement: (i) will be examined by the Master Servicer or the
Special Servicer, as the case may be, and is consistent with this Agreement in
all material respects and requires the Sub-Servicer to comply with all of the
applicable conditions of this Agreement; (ii) provides that if the Master
Servicer or the Special Servicer, as the case may be, shall for any reason no
longer act in such capacity hereunder (including, without limitation, by reason
of an Event of Default), the Trustee or its designee may thereupon assume all of
the rights and, except to the extent they arose prior to the date of assumption,
obligations of the Master Servicer or the Special Servicer, as the case may be,
under such agreement; (iii) provides that the Trustee, for the benefit of the
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Certificateholders, shall be a third party beneficiary under such agreement, but
that (except to the extent the Trustee or its designee assumes the obligations
of the Master Servicer or the Special Servicer, as the case may be, thereunder
as contemplated by the immediately preceding clause (ii)) none of the Trustee,
the Trust Fund, any successor Master Servicer or Special Servicer, as the case
may be, or any Certificateholder shall have any duties under such agreement or
any liabilities arising therefrom; (iv) permits any purchaser of a Mortgage Loan
pursuant to this Agreement to terminate such agreement with respect to such
purchased Mortgage Loan at its option and without penalty, (v) does not permit
the Sub-Servicer to enter into or consent to any modification, waiver or
amendment or otherwise take any action on behalf of the Special Servicer
contemplated by Section 3.20 hereof without the consent of such Special
Servicer, and (vi) does not permit the Sub-Servicer any rights of
indemnification that may be satisfied out of assets of the Trust Fund. In
addition, each Sub-Servicing Agreement entered into by the Master Servicer shall
provide that such agreement shall be subject to Section 3.21 hereof with respect
to any Mortgage Loan that becomes a Specially Serviced Mortgage Loan. The Master
Servicer and the Special Servicer each shall deliver to the Trustee and to each
other copies of all Sub-Servicing Agreements, and any amendments thereto and
modifications thereof, entered into by it promptly upon its execution and
delivery of such documents. References in this Agreement to actions taken or to
be taken by the Master Servicer or the Special Servicer include actions taken or
to be taken by a Sub-Servicer on behalf of the Master Servicer or the Special
Servicer, as the case may be; and, in connection therewith, all amounts advanced
by any Sub-Servicer to satisfy the obligations of the Master Servicer or the
Special Servicer hereunder to make P&I Advances or Servicing Advances shall be
deemed to have been advanced by the Master Servicer or the Special Servicer, as
the case may be, out of its own funds and, accordingly, such P&I Advances or
Servicing Advances shall be recoverable by such Sub-Servicer in the same manner
and out of the same funds as if such Sub-Servicer were the Master Servicer or
the Special Servicer, as the case may be. For so long as they are outstanding,
Advances shall accrue interest in accordance with Sections 3.03(d) and 4.03(d),
such interest to be allocable between the Master Servicer or the Special
Servicer, as the case may be, and such Sub-Servicer as they may agree. For
purposes of this Agreement, the Master Servicer and the Special Servicer each
shall be deemed to have received any payment when a Sub-Servicer retained by it
receives such payment. The Master Servicer and the Special Servicer each shall
notify the other, the Trustee and the Depositor in writing promptly of the
appointment by it of any Sub-Servicer. Notwithstanding the foregoing, however,
third party contractors of the Master Servicer or Special Servicer for
incidental ministerial functions shall not be considered Sub-Servicers and shall
not be subject to this Section 3.22, provided that the Master Servicer and the
Special Servicer shall remain responsible for the actions of such contractors
and shall pay the fees and expenses of such contractors unless otherwise
provided in this Agreement.
(b) Each Sub-Servicer (i) shall be authorized to transact business in the
state or states in which the related Mortgaged Properties it is to service are
situated, if and to the extent required by applicable law, and (ii) shall be an
approved conventional seller/servicer of mortgage loans for FHLMC or FNMA or a
HUD-Approved Servicer.
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(c) The Master Servicer and the Special Servicer, for the benefit of the
Trustee and the Certificateholders, shall (at no expense to the Trustee, the
Certificateholders or the Trust Fund) monitor the performance and enforce the
obligations of their respective Sub-Servicers under the related Sub-Servicing
Agreements. Such enforcement, including, without limitation, the legal
prosecution of claims, termination of Sub-Servicing Agreements in accordance
with their respective terms and the pursuit of other appropriate remedies, shall
be in such form and carried out to such an extent and at such time as the Master
Servicer or the Special Servicer, as applicable, in its good faith business
judgment, would require were it the owner of the Mortgage Loans. Subject to the
terms of the related Sub-Servicing Agreement, the Master Servicer and the
Special Servicer may each have the right to remove a Sub-Servicer retained by it
at any time it considers such removal to be in the best interests of
Certificateholders.
(d) If the Master Servicer or the Special Servicer ceases to serve as such
under this Agreement for any reason (including by reason of an Event of Default)
and no successor Master Servicer or Special Servicer, as the case may be, has
succeeded to its rights and assumed its obligations hereunder or, in the case of
the Special Servicer, no replacement Special Servicer has been designated
pursuant to Section 6.09, then the Trustee or its designee shall succeed to the
rights and assume the obligations of the Master Servicer or the Special Servicer
under any Sub-Servicing Agreement, unless the Trustee elects to terminate any
such Sub-Servicing Agreement in accordance with its terms. Any termination fee
payable to any Sub-Servicer pursuant to any Sub-Servicing Agreement shall not be
the obligation of either the Trustee or the Trust Fund. In any event, if a
Sub-Servicing Agreement is to be assumed by the Trustee or another successor
thereto, the Master Servicer or the Special Servicer, as applicable, at its
expense shall, upon request of the Trustee, deliver to the assuming party all
documents and records relating to such Sub-Servicing Agreement and the Mortgage
Loans then being serviced thereunder and an accounting of amounts collected and
held on behalf of it thereunder, and otherwise use its best efforts to effect
the orderly and efficient transfer of the Sub-Servicing Agreement to the
assuming party.
(e) Notwithstanding any Sub-Servicing Agreement, the Master Servicer and
the Special Servicer shall remain obligated and liable to the Trustee and the
Certificateholders for the performance of their respective obligations and
duties under this Agreement in accordance with the provisions hereof to the same
extent and under the same terms and conditions as if each alone were servicing
and administering the Mortgage Loans or REO Properties for which it is
responsible.
SECTION 3.23. Representations and Warranties of Master Servicer and Special
Servicer.
(a) The Master Servicer, in such capacity, hereby represents and warrants
to the Trustee, for its own benefit and the benefit of the Certificateholders,
and to the Depositor and the Special Servicer, as of the Closing Date, that:
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(i) The Master Servicer is a corporation, duly organized, validly
existing and in good standing under the laws of the State of Delaware, and
the Master Servicer is in compliance with the laws of each State in which
any Mortgaged Property is located to the extent necessary to perform its
obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the Master
Servicer, and the performance and compliance with the terms of this
Agreement by the Master Servicer, will not violate the Master Servicer's
articles of incorporation or by-laws or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default)
under, or result in the breach of, any material agreement or other
instrument to which it is a party or which is applicable to it or any of
its assets.
(iii) The Master Servicer has the full power and authority to carry on
its business as now being conducted and to enter into and consummate all
transactions contemplated by this Agreement, has duly authorized the
execution, delivery and performance of this Agreement, and has duly
executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the Master Servicer, enforceable against the
Master Servicer in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and other
laws affecting the enforcement of creditors' rights generally, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(v) The Master Servicer is not in violation of, and its execution and
delivery of this Agreement and its performance and compliance with the
terms of this Agreement will not constitute a violation of, any law, any
order or decree of any court or arbiter, or any order, regulation or demand
of any federal, state or local governmental or regulatory authority, which
violation, in the Master Servicer's good faith and reasonable judgment, is
likely to affect materially and adversely either the ability of the Master
Servicer to perform its obligations under this Agreement or the financial
condition of the Master Servicer.
(vi) No litigation is pending or, to the best of the Master Servicer's
knowledge, threatened, against the Master Servicer that would prohibit the
Master Servicer from entering into this Agreement or, in the Master
Servicer's good faith and reasonable judgment, is likely to materially and
adversely affect either the ability of the Master Servicer to perform its
obligations under this Agreement or the financial condition of the Master
Servicer.
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(vii) Each officer, director or employee of the Master Servicer with
responsibilities concerning the servicing and administration of Mortgage
Loans is covered by errors and omissions insurance in the amounts and with
the coverage as, and to the extent, required by Section 3.07(c).
(viii) The net worth of the Master Servicer (or, in the case of the
initial Master Servicer, the consolidated net worth thereof and of its
direct or indirect parent), determined in accordance with generally
accepted accounting principles, is not less than $15,000,000.
(ix) Any consent, approval, authorization or order of any court or
governmental agency or body required for the execution, delivery and
performance by the Master Servicer of or compliance by the Master Servicer
with this Agreement or the consummation of the transactions contemplated by
this Agreement has been obtained and is effective.
(x) The Master Servicer acknowledges and agrees that the Servicing Fee
(computed at the Imputed Servicing Fee Rate) represents no more than
reasonable compensation for the services being provided by the Master
Servicer and that such Servicing Fee paid to the Master Servicer shall be
treated for accounting and tax purposes by the Master Servicer as
compensation for the servicing and administration of the Mortgage Loans.
(xi) The Master Servicer has examined each existing Sub-Servicing
Agreement, and is familiar with the terms thereof and the terms of such
Sub-Servicing Agreements are and will not be materially inconsistent with
the provision of this Agreement.
(b) The Special Servicer, in such capacity, hereby represents and warrants
to the Trustee, for its own benefit and the benefit of the Certificateholders,
and to the Depositor and the Master Servicer, as of the Closing Date, that:
(i) The Special Servicer is a Texas corporation, duly organized,
validly existing and in good standing under the laws of the State of Texas,
and the Special Servicer is in compliance with the laws of each State in
which any Mortgaged Property is located to the extent necessary to perform
its obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the Special
Servicer, and the performance and compliance with the terms of this
Agreement by the Special Servicer, will not violate the Special Servicer's
certificate of incorporation or constitute a default (or an event which,
with notice or lapse of time, or both, would constitute a default) under,
or result in the breach of, any material agreement or other instrument to
which it is a party or which is applicable to it or any of its assets.
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(iii) The Special Servicer has the full power and authority to carry
on its business as now being conducted and to enter into and consummate all
transactions contemplated by this Agreement, has duly authorized the
execution, delivery and performance of this Agreement, and has duly
executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the Special Servicer, enforceable against the
Special Servicer in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and other
laws affecting the enforcement of creditors' rights generally, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(v) The Special Servicer is not in violation of, and its execution and
delivery of this Agreement and its performance and compliance with the
terms of this Agreement will not constitute a violation of, any law, any
order or decree of any court or arbiter, or any order, regulation or demand
of any federal, state or local governmental or regulatory authority, which
violation, in the Special Servicer's good faith and reasonable judgment, is
likely to affect materially and adversely either the ability of the Special
Servicer to perform its obligations under this Agreement or the financial
condition of the Special Servicer.
(vi) No litigation is pending or, to the best of the Special
Servicer's knowledge, threatened, against the Special Servicer that would
prohibit the Special Servicer from entering into this Agreement or, in the
Special Servicer's good faith and reasonable judgment, is likely to
materially and adversely affect either the ability of the Special Servicer
to perform its obligations under this Agreement or the financial condition
of the Special Servicer.
(vii) Each officer, director and employee of the Special Servicer with
responsibilities concerning the servicing and administration of Mortgage
Loans is covered by errors and omissions insurance in the amounts and with
the coverage required by Section 3.07(c).
(viii) Any consent, approval, authorization or order of any court or
governmental agency or body required for the execution, delivery and
performance by the Special Servicer of or compliance by the Special
Servicer with this Agreement or the consummation of the transactions
contemplated by this Agreement has been obtained and is effective.
(ix) The Special Servicer acknowledges and agrees that the Special
Servicing Fee represents reasonable compensation for the services being
provided by the Special Servicer and that the Special Servicer shall treat
the entire Special
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Servicing Fee for accounting and tax purposes as compensation for the
servicing and administration of any Specially Serviced Mortgage Loans and
REO Loans.
(x) The Special Servicer has examined each existing Sub-Servicing
Agreement, if any, and is familiar with the terms thereof and the terms of
such Sub-Servicing Agreements will not be materially inconsistent with the
provisions of this Agreement.
(c) The representations and warranties of the Master Servicer and the
Special Servicer, set forth in Sections 3.23(a) and (b), respectively, shall
survive the execution and delivery of this Agreement and shall inure to the
benefit of the Persons for whose benefit they were made for so long as the Trust
Fund remains in existence. Upon discovery by any party hereto of any breach of
any of the foregoing representations and warranties, the party discovering such
breach shall give prompt written notice to the other parties.
SECTION 3.24. Duties of Extension Adviser.
(a) The Special Servicer may not extend the maturity of any Specially
Serviced Mortgage Loan pursuant to Section 3.20(d) for a period in excess of 12
months per extension or 36 months in the aggregate, unless the Extension Adviser
shall have approved such extension in writing within ten days (or 20 days if
such period shall be extended in accordance with the following paragraph) after
receiving from the Special Servicer written notice thereof and sufficient
information to make an informed decision. The Extension Advisor shall approve
such extensions if it determines that the decision of the Special Servicer to so
extend such Mortgage Loan is consistent with the Servicing Standard and is in
the best interest of the Certificateholders who have elected such Extension
Adviser.
The Extension Advisor's review shall consist of the review of relevant
information furnished to it by the Special Servicer and such other information
as it may have or obtain with respect to the subject Mortgage Loan, and the
circumstances (legal, market, physical, financial and otherwise) which may
impact its collection. If a written objection to such extension from the
Extension Adviser has not been received by the Special Servicer within said
ten-day period (except as the Extension Adviser may, within such 10-day period
notify the Special Servicer in writing that it requires an additional 10 day
period to complete its investigation, in which event, the Special Servicer shall
not unreasonably refuse to grant such an additional 10 day period), then the
Extension Adviser's approval shall be deemed to have been given. In addition,
the Extension Adviser shall confirm, to its reasonable satisfaction, that all
conditions precedent to the granting of any such extension set forth in this
Agreement have been satisfied and may obtain information outside of its normal
data resources to fulfill its responsibilities.
(b) The Special Servicer shall, with respect to any proposed extension of a
Balloon Payment with respect to a Specially Serviced Mortgage Loan for a period
in excess of 12 months per extension or 36 months in the aggregate, prepare and
deliver to the Extension Adviser, a summary of such proposed action and an
analysis of whether such action is reasonably likely to produce a greater
recovery of collections on a present value basis (the
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relevant discounting to be performed at the related Net Mortgage Rate) than
liquidation of such Mortgage Loan and shall provide the appraisal required by
Section 3.20(d) and such further information with respect thereto as the
Extension Advisor may reasonably request. Such analysis shall specify the basis
on which the Special Servicer has made such determination, including the status
of any existing material default or the grounds for concluding that a payment
default is imminent. Any reasonable out-of-pocket expenses incurred by the
Special Servicer in providing such information pursuant to this Section 3.24(b)
shall be deemed to be a Servicing Advance and shall be reimbursable to the
Special Servicer pursuant to Section 3.05(a).
(c) All correspondence and communications with the Extension Adviser and,
in the event any subcontractor is appointed pursuant to Section 3.24(f), such
subcontractor, shall be conducted with the officers or employees of Extension
Adviser and such subcontractor whose names appear on a list of officers or
employees furnished to the Special Servicer by the Extension Adviser and such
subcontractor, as such list may from time to time be amended. All correspondence
delivered to the Extension Adviser shall be simultaneously delivered to any such
subcontractor.
SECTION 3.25. Election of Extension Adviser.
(a) LaSalle National Bank shall serve as the initial Extension Adviser
hereunder. The Holder or Holders of 51% or more of the aggregate Certificate
Principal Balance of the Registered Certificates (other than the Class IO
Certificates) will be entitled to elect or remove at any time, as the case may
be, the "Extension Adviser" as provided in this Section 3.25. Upon (i) the
receipt by the Trustee of a written request for an election of an Extension
Adviser by the Special Servicer in the event that no Extension Adviser is
serving and the maturity of a Specially Serviced Mortgage Loan has been extended
beyond its second anniversary, (ii) the receipt by the Trustee of written
requests for an election of an Extension Adviser from Certificateholders
representing more than 51% of the aggregate Certificate Principal Balance of all
the Registered Certificates (other than the Class IO Certificates), or (iii) the
resignation or removal of the Person acting as Extension Adviser, an election of
a successor Extension Adviser shall be held commencing as soon as practicable
thereafter.
(b) After any such receipt, resignation, removal or determination
contemplated by Section 3.25(a), the Trustee shall call a meeting of the Holders
of all Registered Certificates (other than the Class IO Certificates), if any,
for the purpose of electing an Extension Adviser. Notice of any such meeting of
such Holders shall be mailed or delivered to each Holder not less than 10 days
nor more than 60 days prior to the meeting. The notice shall state the place and
the time of the meeting, which may be held by telephone. Certificateholders
representing a majority (by Certificate Principal Balance) of the Certificates
of the applicable Class or Classes, present in person or represented by proxy,
shall constitute a quorum for the nomination of an Extension Adviser. At the
meeting, each such Holder shall be entitled to nominate one Person to act as
Extension Adviser. The Trustee shall cause the election of the Extension Adviser
to be held as soon thereafter as convenient.
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(c) Each Holder of Registered Certificates (other than the Class IO
Certificates) shall be entitled to vote in each election of the Extension
Adviser. The voting in each election of the Extension Adviser, as the case may
be, shall be in writing mailed, delivered or sent by courier and actually
received by the Trustee on or prior to the date of such election. Immediately
upon a determination by the Trustee that it has received votes (which have not
been rescinded) from the Holders of Certificates representing 51% or more of the
aggregate Certificate Principal Balance of all the Registered Certificates
(other than the Class IO Certificates), which votes are cast for a single
Person, such Person shall be, upon such Person's acceptance, the Extension
Adviser. In the event that the applicable Certificateholders have not elected a
successor Extension Adviser or that an Extension Adviser shall have resigned or
been removed and a successor Extension Adviser shall not have been elected,
there shall be no Extension Adviser. Notwithstanding anything to the contrary
contained herein, the Special Servicer shall not have any right to extend the
maturity of any Specially Serviced Mortgage Loan which would require the
approval of an Extension Adviser nor shall the Special Servicer have any right
or obligation to consult with or to seek and/or obtain approval or direction
from an Extension Adviser, and provisions of this Agreement relating thereto
shall be of no effect, in any event during any such period that there is no
Extension Adviser. As to each Specially Serviced Mortgage Loan that is
considered by the Extension Adviser for extension pursuant to Section 3.24
hereof, the Extension Adviser's fee (which fee shall be part of the "Extension
Adviser Fee," as defined below) shall not exceed the fees set forth in paragraph
(h) for each request for extension of a Mortgage Loan on which the Extension
Adviser actually advises the Special Servicer.
(d) The Extension Adviser may be removed at any time by the written vote,
copies of which must be delivered to the Trustee, of Holders of Certificates
representing 51% or more of the aggregate Certificate Principal Balance of all
the Registered Certificates.
(e) Upon election of a successor Extension Adviser, the Trustee shall
promptly mail notice thereof by first class mail to the Depositor, the Master
Servicer, the Special Servicer, the Mortgage Loan Sellers and each of the Rating
Agencies.
(f) The Extension Adviser may resign at any time by giving written notice
to the Certificateholders and the Trustee.
(g) The initial Extension Adviser may subcontract with a third-party for
the performance of the Extension Adviser's obligations hereunder, provided that
it gives written notice to the Certificateholders, the Special Servicer and the
Trustee of such subcontract.
(h) As compensation for its activities set forth in this Section 3.24, the
Extension Advisor shall be entitled to receive the "Extension Adviser Fee,"
which shall consist of:
(i) upon the completion of each review of an extension request, an
inflation adjusted review fee of $3,000, payable out of the Trust Fund;
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(ii) for any review request that is withdrawn by a Special Servicer or
by the Trustee prior to the completion of the review, a fee, payable equal
to the lesser of (a) the full inflation adjusted review fee (as described
and computed below), or (b) a fee for the estimated hours of effort by the
reviewing officer of the Extension Adviser, times an inflation adjusted
billing factor of $325 per hour, such adjusted billing factor to be
computed in a manner similar to the computation of the adjusted review fee
as described below; and
(iii) with respect to the initial Extension Adviser, an initial fee of
$7,500 payable by and allocated among the Depositor and each Underwriter.
The inflation-adjusted review fee in effect for each calendar year shall be
equal to the nearest whole dollar of the product of (a) $3,000, times (b) the
"Consumer Price Index for All Urban Consumers, U.S. City, Annual Average", which
is usually published by the U.S. Department of Commerce in mid-January of each
year (or equivalent, replacement economic index) (the "CPI") for the year
preceding the year in which the review of an extension request is completed,
divided by (c) the CPI for the year which is expected to be published in
mid-January.
(i) The Extension Adviser shall be reimbursed pursuant to Section
3.05(b)(viii) for all reasonable expenses incurred by the Extension Adviser to
the extent such expenses relate to its agreement to perform, and the actual
performance of its services; which expenses may include, but are not limited to,
attorneys' fees and expenses of outside counsel, appraisal, engineering and
consulting fees, travel expenses with respect to the investigation of a
Mortgaged Property and its market, and the costs of acquiring related data and
reports; provided, however, that such expenses shall not include the costs of
acquiring information which the Extension Adviser incurs in the ordinary course
of its business.
SECTION 3.26. Limitation on Liability of Extension Adviser.
The Extension Adviser will be acting solely as a representative of the
interests of the Class or Classes of Certificateholders that have elected such
adviser and with its primary duty to act in accordance with Section 3.24(b), the
Extension Adviser shall not have any responsibility or liability to the Trust or
the Certificateholders for any action taken, or for refraining from the taking
of any action, in good faith pursuant to this Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the Extension
Adviser against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations or duties hereunder.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.
(a) On each Distribution Date, the Paying Agent shall (except as otherwise
provided in Section 9.01), based on information provided by the Master Servicer
and the Special Servicer, apply amounts on deposit in the Distribution Account,
after payment of amounts payable from the Distribution Account in accordance
with Section 3.05(b)(ii) through (viii), in each case to the extent of the
remaining portion of the Available Distribution Amount, in the following order
of priority:
(i) to distributions of interest to the Holders of the Senior
Certificates in an amount equal to, and pro rata in accordance with, all
Distributable Certificate Interest in respect of each Class of Senior
Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(ii) to distributions of principal to the Holders of the Class A-1
Certificates, in an amount (not to exceed the Class Principal Balance of
the Class A-1 Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date;
(iii) after the Class Principal Balance of the Class A-1 Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class A-2 Certificates, in an amount (not to exceed the Class Principal
Balance of the Class A-2 Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of the Class A-1 Certificates pursuant to
clause (ii) above);
(iv) after the Class Principal Balances of the Class A-1 Certificates
and Class A-2 Certificates have been reduced to zero, to distributions of
principal to the Holders of the Class A-3 Certificates, in an amount (not
to exceed the Class Principal Balance of the Class A-3 Certificates
outstanding immediately prior to such Distribution Date) equal to the
entire Principal Distribution Amount for such Distribution Date (net of any
portion thereof distributed on such Distribution Date to the Holders of any
other Class of Certificates);
(v) to distributions to the Holders of the Class A-1 Certificates, the
Class A-2 Certificates and the Class A-3 Certificates, pro rata, in
accordance with the outstanding Certificate Principal Balances of such
Classes of Certificates in an amount equal to, and in reimbursement of, all
Realized Losses
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and Additional Trust Fund Expenses, if any, previously allocated to such
Classes of Certificates and not previously reimbursed;
(vi) to distributions of interest to the Holders of the Class B
Certificates in an amount equal to all Distributable Certificate Interest
in respect of such Class of Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(vii) after the Class Principal Balances of the Class A-1
Certificates, the Class A-2 Certificates and the Class A-3 Certificates
have been reduced to zero, to distributions of principal to the Holders of
the Class B Certificates, in an amount (not to exceed the Class Principal
Balance of the Class B Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of any other Class of Certificates
pursuant to clause (ii) above);
(viii) to distributions to the Holders of the Class B Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class B
Certificates and not previously reimbursed;
(ix) to distributions of interest to the Holders of the Class C
Certificates in an amount equal to all Distributable Certificate Interest
in respect of such Class of Certificates for such Distribution Date, and,
to the extent not previously paid, for all prior Distribution Dates;
(x) after the Class Principal Balance of the Class B Certificates has
been reduced to zero, to distributions of principal to the Holders of the
Class C Certificates, in an amount (not to exceed the Class Principal
Balance of the Class C Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of any other Class of Certificates);
(xi) to distributions to the Holders of the Class C Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class C
Certificates and not previously reimbursed;
(xii) to distributions of interest to the Holders of the Class D
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class D Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
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(xiii) after the Class Principal Balance of the Class C Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class D Certificates, in an amount (not to exceed the Class Principal
Balance of the Class D Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of any other Class of Certificates);
(xiv) to distributions to the Holders of the Class D Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class D
Certificates and not previously reimbursed;
(xv) to distributions of interest to the Holders of the Class E
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class E Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xvi) after the Class Principal Balance of the Class D Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class E Certificates, in an amount (not to exceed the Class Principal
Balance of the Class E Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of any other Class of Certificates);
(xvii) to distributions to the Holders of the Class E Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class E
Certificates and not previously reimbursed;
(xviii) to distributions of interest to the Holders of the Class F
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class F Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xix) after the Class Principal Balance of the Class E Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class F Certificates, in an amount (not to exceed the Class Principal
Balance of the Class F Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of any other Class of Certificates);
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(xx) to distributions to the Holders of the Class F Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class F
Certificates and not previously reimbursed;
(xxi) to distributions of interest to the Holders of the Class G
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class G Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxii) after the Class Principal Balance of the Class F Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class G Certificates, in an amount (not to exceed the Class Principal
Balance of the Class G Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of any other Class of Certificates);
(xxiii) to distributions to the Holders of the Class G Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class G
Certificates and not previously reimbursed;
(xxiv) to distributions of interest to the Holders of Class H
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class H Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxv) after the Class Principal Balance of the Class G Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class H Certificates, in an amount (not to exceed the Class Principal
Balance of the Class H Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distributed on such
Distribution Date to the Holders of any other Class of Certificates);
(xxvi) to distributions to the Holders of the Class H Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to each such
Class of Certificates and not previously reimbursed;
(xxvii) to distributions of interest to the Holders of Class J
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class J Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
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(xxviii) after the Class Principal Balance of the Class H Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class J Certificates, in an amount (not to exceed the Class Principal
Balance of the Class J Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount for
such Distribution Date (net of any portion thereof distribution or such
Distribution Date to the Holders of any other Class of Certificates);
(xxix) to distributions to the Holders of the Class J Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to each such
Class of Certificates and not previously reimbursed; and
(xxx) to distributions to the Holders of the Class R-III Certificates,
in an amount equal to the balance, if any, of the Available Distribution
Amount for such Distribution Date remaining after the distributions to be
made on such Distribution Date pursuant to clauses (i) through (xxix)
above.
Distributions in reimbursement of Realized Losses and Additional Trust Fund
Expenses previously allocated to a Class of Certificates shall not constitute
distributions of principal and shall not result in reduction of the related
Class Principal Balance.
(b) On each Distribution Date, the Paying Agent shall apply any
amounts that represent Prepayment Premiums actually collected on the Mortgage
Loans and any REO Loans during the related Collection Period and shall
distribute the entire amount of such withdrawal, as additional interest, as
follows:
(i) With respect to any Percentage Premiums:
until the Certificate Principal Balance(s) of the Class A-1, Class
A-2, Class A-3, Class B, Class C, Class D, Class E, Class F, Class G, Class
H and Class J Certificates have been reduced to zero, to the Holders of the
Class A-1, Class A-2, Class A-3, Class B, Class C, Class D, Class E, Class
F, Class G, Class H and Class J Certificates, in the case of each such
Class in an amount equal to the product of (1) the related Class Prepayment
Percentage for such Distribution Date, multiplied by (2) 25% of the total
amount of each such Percentage Premium collected, and to the Holders of the
Class IO Certificates, the remaining amount of each such Percentage
Premium.
(ii) With respect to any Yield Maintenance Charge or Treasury Spread
Maintenance collected:
until the Certificate Principal Balances of the Class A-1, Class A-2,
Class A-3, Class B, Class C, Class D, Class E, Class F, Class G, Class H
and Class J Certificates have been reduced to zero, (x) to Holders of Class
A-1, Class A-2,
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Class A-3, Class B, Class C, Class D, Class E, Class F, Class G, Class H
and Class J Certificates, in the case of each such Class, an amount equal
to the product of (1) a fraction (not greater than one and not less than
zero), the numerator of which is the respective Pass-Through Rate of such
Class, reduced by the discount rate used in calculating such Yield
Maintenance Charge or Treasury Spread Maintenance and the denominator of
which is the Mortgage Rate of the applicable Mortgage Loan, less such
discount rate, multiplied by (2) the applicable Class Prepayment
Percentage, multiplied by (3) the amount of such Yield Maintenance Charge
or Treasury Spread Maintenance collected, and (y) to the Holders of the
Class IO Certificates, an amount equal to the remaining portion of such
Yield Maintenance Charge or Treasury Spread Maintenance for such
Distribution Date.
(c) On each Distribution Date, Additional Interest collected during the
related Collection Period for such Distribution Date shall be distributed to
Gemstone Acquisition Corporation or its assignee.
(d) All distributions made with respect to each Class on each Distribution
Date shall be allocated pro rata among the outstanding Certificates in such
Class based on their respective Percentage Interests. Except as otherwise
provided below, all such distributions with respect to each Class on each
Distribution Date shall be made to the Certificateholders of the respective
Class of record at the close of business on the related Record Date and shall be
made by wire transfer of immediately available funds to the account of any such
Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent Distribution Dates) or otherwise by check mailed to
the address of such Certificateholder as it appears in the Certificate Register.
The final distribution on each Certificate (determined without regard to any
possible future reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to such Certificate) will be made in like manner,
but only upon presentation and surrender of such Certificate at the offices of
the Certificate Registrar or such other location specified in the notice to
Certificateholders of such final distribution. Prior to any termination of the
Trust Fund pursuant to Section 9.01, any distribution that is to be made with
respect to a Certificate in reimbursement of a Realized Loss or Additional Trust
Fund Expense previously allocated thereto, which reimbursement is to occur after
the date on which such Certificate is surrendered as contemplated by the
preceding sentence, will be made by check mailed to the address of the
Certificateholder that surrendered such Certificate as such address last
appeared in the Certificate Register or to any other address of which the Paying
Agent was subsequently notified in writing. If such check is returned to the
Paying Agent, the Paying Agent, directly or through an agent, shall take such
reasonable steps to contact the related Holder and deliver such check as it
shall deem appropriate. Any funds in respect of a check returned to the Paying
Agent shall be set aside by the Paying Agent and held uninvested in trust and
credited to the account of the appropriate Holder. The costs and expenses of
locating the appropriate Holder and holding such funds shall be paid out of such
funds. No interest shall accrue or be payable to any former Holder on any amount
held in trust hereunder. If the Paying Agent has
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not, after having taken such reasonable steps, located the related Holder by the
second anniversary of the initial sending of a check, the Paying Agent shall
distribute the unclaimed funds to the Class R-III Certificateholder.
(e) Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the related Certificate Owners that it represents and to each indirect
participating brokerage firm (a "brokerage firm" or "indirect participating
firm") for which it acts as agent. Each brokerage firm shall be responsible for
disbursing funds to the related Certificate Owners that it represents. None of
the Trustee, the Paying Agent, the Certificate Registrar, the Depositor or the
Master Servicer shall have any responsibility therefor except as otherwise
provided by this Agreement or applicable law. The Trustee and the Depositor
shall perform their respective obligations under the Letter of Representations
among the Depositor, the Trustee and the initial Depository.
(f) The rights of the Certificateholders to receive distributions from the
proceeds of the Trust Fund in respect of the Certificates, and all rights and
interests of the Certificateholders in and to such distributions, shall be as
set forth in this Agreement. Neither the Holders of any Class of Certificates
nor any party hereto shall in any way be responsible or liable to the Holders of
any other Class of Certificates in respect of amounts properly previously
distributed on the Certificates.
(g) Except as otherwise provided in Section 9.01, whenever the Paying Agent
expects that the final distribution with respect to any Class of Certificates
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to such Class of
Certificates) will be made on the next Distribution Date, the Paying Agent
shall, no later than five days after the related Determination Date, mail to
each Holder of record on such date of such Class of Certificates a notice to the
effect that:
(i) the Paying Agent expects that the final distribution with respect
to such Class of Certificates will be made on such Distribution Date but
only upon presentation and surrender of such Certificates at the office of
the Certificate Registrar or at such other location therein specified, and
(ii) no interest shall accrue on such Certificates from and after such
Distribution Date.
Any funds not distributed to any Holder or Holders of Certificates of such Class
on such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates shall, on such date, be set aside and held uninvested
in trust and credited to the account or accounts of the appropriate
non-tendering Holder or Holders. If any Certificates as to which
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notice has been given pursuant to this Section 4.01(g) shall not have been
surrendered for cancellation within six months after the time specified in such
notice, the Paying Agent shall mail a second notice to the remaining
non-tendering Certificateholders to surrender their Certificates for
cancellation in order to receive the final distribution with respect thereto. If
within one year after the second notice all such Certificates shall not have
been surrendered for cancellation, the Paying Agent, directly or through an
agent, shall take such steps to contact the remaining non-tendering
Certificateholders concerning the surrender of their Certificates as it shall
deem appropriate. The costs and expenses of holding such funds in trust and of
contacting such Certificateholders following the first anniversary of the
delivery of such second notice to the non-tendering Certificateholders shall be
paid out of such funds. No interest shall accrue or be payable to any former
Holder on any amount held in trust pursuant to this paragraph. If all of the
Certificates shall not have been surrendered for cancellation by the 270th day
following delivery of the second notice, the Paying Agent shall distribute to
the Class R-III Certificateholder all unclaimed funds and other assets which
remain subject thereto.
(h) Notwithstanding any other provision of this Agreement, the Paying Agent
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Paying Agent
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. If the Paying
Agent does withhold any amount from interest or original issue discount payments
or advances thereof to any Certificateholder pursuant to federal withholding
requirements, the Paying Agent shall indicate the amount withheld to such
Certificateholders.
(i) All distributions made in respect of any Class of Certificates (other
than the Class IO Certificates) on each Distribution Date pursuant to Section
4.01(a), 4.01(b) or 9.01 shall be deemed to have first been distributed from
REMIC II to REMIC III in respect of its corresponding REMIC II Regular Interest
set forth in the Preliminary Statement hereto; all interest distributions made
in respect of the Class IO Certificates on each Distribution Date pursuant to
Section 4.01(a), 4.01(b) or 9.01 shall be deemed to have first been distributed
from REMIC II to REMIC III in respect of REMIC II Regular Interests as follows:
in the case of interest which has accrued on Component IO-1, such amounts shall
be deemed to have first been distributed from REMIC II to REMIC III in respect
of REMIC II Regular Interest IO to the extent of one month's interest accrued at
a rate equal to the Weighted Average Effective REMIC I Remittance Rate minus
7.12% on a Notional Principal Amount equal to the Stated Principal Balance of
the Mortgage Loans immediately prior to such Distribution Date; in the case of
interest which has accrued on Component IO-2a, such amounts shall be deemed to
have first been distributed from REMIC II to REMIC III in respect of REMIC II
Regular Interest P, to the extent of one month's interest accrued at the rate of
0.17% per annum on the Uncertificated Principal Balance of REMIC II Regular
Interest P outstanding immediately prior to such Distribution Date; and in the
case of interest which has accrued on Component IO-2b such amounts shall be
deemed to have first been distributed from REMIC II to REMIC III in respect of
REMIC II Regular Interest Q, to the extent of one month's interest accrued at
the rate of 0.09% per annum on the Uncertificated Principal Balance of REMIC II
Regular
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Interest Q outstanding immediately prior to such Distribution Date; in each case
calculated on the basis of a 360-day year consisting of twelve 30-day months. In
each case, if such distribution on any such Class of Certificates was a
distribution of interest, of principal, of Prepayment Premiums or in
reimbursement of previously allocated Realized Losses and Additional Trust Fund
Expenses in respect of such Class of Certificates, then the corresponding
distribution deemed to be made on the related REMIC II Regular Interest pursuant
to the preceding sentence shall be deemed to also be a distribution of interest,
of principal, of Prepayment Premiums or in reimbursement of previously allocated
Realized Losses and Additional Trust Fund Expenses, as the case may be, in
respect of such REMIC II Regular Interest.
(j) On each Distribution Date, the portion of the Available Distribution
Amount for such date distributed in respect of the Regular Certificates pursuant
to Section 4.01(a), 4.01(b) or 9.01 shall be deemed to have first been
distributed from REMIC I to REMIC II in respect of the REMIC I Regular
Interests, in each case to the extent of the remaining portions of such funds,
for the following purposes and in the following order of priority:
(i) as deemed distributions of interest in respect of the REMIC I
Regular Interests, in an amount equal to, and pro rata in accordance with,
all Uncertificated Distributable Interest in respect of each such REMIC I
Regular Interest for such Distribution Date and, to the extent not
previously deemed distributed, for all prior Distribution Dates;
(ii) as deemed distributions of principal in respect of the REMIC I
Regular Interests, in an amount equal to, and pro rata in accordance with,
as to each such REMIC I Regular Interest, the excess, if any, of the
Uncertificated Principal Balance of such REMIC I Regular Interest
outstanding immediately prior to such Distribution Date, over the Stated
Principal Balance of the related Mortgage Loan (or Successor REO Loan) that
will be outstanding immediately following such Distribution Date; and
(iii) as distributions in respect of the REMIC I Regular Interests, in
reimbursement of previously allocated Realized Losses (with compounded
interest), allocated to each such REMIC I Regular Interest.
SECTION 4.02. Statements to Certificateholders; Collection Reports.
(a) On each Distribution Date, the Trustee shall forward by mail (or
electronic medium to any Rating Agency or those Holders of any Class of Regular
Certificates who so request), not facsimile, to the Depositor, the Master
Servicer and all of the Holders of each Class of Regular Certificates, the
initial beneficial owners of each Class of Regular Certificates and subsequent
beneficial owners of the Regular Certificates (a list of which shall be provided
to the Trustee on the Closing Date substantially in the form set forth on
Exhibit K hereto or, in the case of subsequent beneficial owners, as identified
to the reasonable
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satisfaction of the Trustee) upon their written request to the Trustee, a
statement (a "Distribution Date Statement") as to the distributions made on such
Distribution Date, based on information provided to it by the Master Servicer
and the Special Servicer (upon which information the Trustee may conclusively
rely), setting forth:
(i) the amount of the distribution on such Distribution Date to the
Holders of such Class of Regular Certificates in reduction of the Class
Principal Balance thereof;
(ii) the amount of the distribution on such Distribution Date to the
Holders of such Class of Regular Certificates allocable to Distributable
Certificate Interest;
(iii) the amount of the distribution on such Distribution Date to the
Holders of such Class of Regular Certificates allocable to Prepayment
Premiums;
(iv) the amount of the distribution on such Distribution Date to the
Holders of such Class of Regular Certificates in reimbursement of
previously allocated Realized Losses and Additional Trust Fund Expenses;
(v) the Available Distribution Amount for such Distribution Date;
(vi) (a) the aggregate amount of P&I Advances made in respect of such
Distribution Date pursuant to Section 4.03(a) (with a detail of the amount
by which such P&I Advances were reduced as a result of any Appraisal
Reduction Amount), including, without limitation, any amounts applied
pursuant to Section 4.03(a)(ii), and the aggregate amount of unreimbursed
P&I Advances that had been outstanding at the close of business on the
related Determination Date and the aggregate amount of interest accrued and
payable to the Master Servicer, the Trustee or the Fiscal Agent in respect
of such unreimbursed P&I Advances in accordance with Section 4.03(d) as of
the close of business on the related Determination Date and (b) the
aggregate amount of Servicing Advances and Nonrecoverable Advances as of
the close of business on the related Determination Date;
(vii) the aggregate unpaid principal balance of the Mortgage Pool
outstanding as of the close of business on the related Determination Date;
(viii) the aggregate Stated Principal Balance of the Mortgage Pool
outstanding immediately before and immediately after such Distribution
Date;
(ix) the number, aggregate principal balance, weighted average
remaining term to maturity and weighted average Mortgage Rate of the
Mortgage Loans as of the close of business on the related Determination
Date;
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(x) the number, aggregate unpaid principal balance (as of the close of
business on the related Determination Date) and aggregate Stated Principal
Balance (immediately after such Distribution Date) of Mortgage Loans (A)
delinquent one month, (B) delinquent two months, (C) delinquent three or
more months, (D) as to which foreclosure proceedings have been commenced
and (E) any Specially Serviced Mortgage Loans.
(xi) as to each Mortgage Loan referred to in the preceding clause (x)
above, (A) the loan number thereof, (B) the Stated Principal Balance
thereof immediately following such Distribution Date, (C) whether the
delinquency is in respect of its Balloon Payment, (D) whether a notice of
acceleration has been sent to the Mortgagor and, if so, the date of such
notice, (E) if an Environmental Assessment of the related Mortgaged
Property has been performed as contemplated by Section 3.09(c) and the
assessment is such that the Special Servicer cannot make the determination
set forth in clauses (A)(i) and (A)(ii) of the first sentence of Section
3.09(c), a brief description of the results of such Environmental
Assessment, and (F) a brief description of the status of any foreclosure
proceedings or any workout or loan modification negotiations with the
related Mortgagor;
(xii) with respect to any Mortgage Loan as to which a Liquidation
Event occurred during the related Collection Period (other than a payment
in full), (A) the loan number thereof, (B) the nature of the Liquidation
Event and, in the case of a Final Recovery Determination, a brief
description of the basis for such Final Recovery Determination, (C) the
aggregate of all Liquidation Proceeds and other amounts received in
connection with such Liquidation Event (separately identifying the portion
thereof allocable to distributions on the Certificates), and (D) the amount
of any Realized Loss in connection with such Liquidation Event;
(xiii) with respect to each REO Property included in the Trust Fund as
of the close of business on the related Determination Date, (A) the loan
number of the related Mortgage Loan, (B) the date of acquisition of such
REO Property by the Trust Fund, (C) the book value (within the meaning of
12 C.F.R. ss. 571.13) of such REO Property, (D) the aggregate of all REO
Revenues and other amounts received with respect to such REO Property
during the related Collection Period (separately identifying the portion
thereof allocable to distributions on the Certificates), (E) the Stated
Principal Balance of the related REO Loan immediately following such
Distribution Date, and (F) a brief description of the Special Servicer's
efforts since the last Distribution Date to stabilize the tenancy of such
REO Property, to repair and restore such REO Property to marketable
condition and to sell such REO Property at its then current fair market
value;
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(xiv) with respect to any REO Property included in the Trust Fund as
to which a Final Recovery Determination was made during the related
Collection Period, (A) the loan number of the related Mortgage Loan, (B) a
brief description of the basis for the Final Recovery Determination, (C)
the aggregate of all Liquidation Proceeds and other amounts received in
connection with such Final Recovery Determination (separately identifying
the portion thereof allocable to distributions on the Certificates), and
(D) the amount of any Realized Loss in respect of the related REO Loan in
connection with such Final Recovery Determination;
(xv) the Accrued Certificate Interest and Distributable Certificate
Interest in respect of such Class of Regular Certificates for such
Distribution Date;
(xvi) any unpaid Distributable Certificate Interest in respect of such
Class of Regular Certificates after giving effect to the distributions made
on such Distribution Date;
(xvii) the Pass-Through Rate for such Class of Regular Certificates
for such Distribution Date;
(xviii) the Principal Distribution Amount for such Distribution Date,
separately identifying the respective components thereof (and, in the case
of any Principal Prepayment or other unscheduled collection of principal
received during the related Collection Period, the loan number for the
related Mortgage Loan and the amount of such prepayment or other collection
of principal);
(xix) the aggregate of all Realized Losses incurred during the related
Collection Period and, aggregated by type, all Additional Trust Fund
Expenses incurred during the related Collection Period;
(xx) the aggregate of all Realized Losses and Additional Trust Fund
Expenses that remain unallocated immediately following such Distribution
Date;
(xxi) the Class Principal Balance of each Class of Regular
Certificates (other than the Class IO Certificates) and the Component
Notional Amount of each Component outstanding immediately before and
immediately after such Distribution Date, separately identifying any
reduction therein due to the allocation of Realized Losses and Additional
Trust Fund Expenses on such Distribution Date;
(xxii) the Certificate Factor for each Class of Regular Certificates
immediately following such Distribution Date;
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(xxiii) the aggregate amount of interest on P&I Advances paid to the
Master Servicer, the Trustee or the Fiscal Agent during the related
Collection Period in accordance with Section 4.03(d);
(xxiv) the aggregate amount of interest on Servicing Advances paid to
the Master Servicer and the Special Servicer during the related Collection
Period in accordance with Section 3.03(d);
(xxv) (A) the aggregate amount of servicing compensation (separately
identifying the amount of each category of compensation, including, but not
limited to, any Servicing Fee Increase) paid to the Master Servicer, the
Special Servicer and, if payable directly out of the Trust Fund without a
reduction in the servicing compensation otherwise payable to the Master
Servicer or the Special Servicer, to each Sub-Servicer, during the related
Collection Period, and (B) such other information as the Trustee is
required by the Code or other applicable law to furnish to enable
Certificateholders to prepare their tax returns;
(xxvi) a brief description of any waiver, modification or amendment of
the terms of any Mortgage Loan entered into by the Master Servicer or the
Special Servicer pursuant to Section 3.20 during the related Collection
Period; and
(xxvii) the amount of the distribution on such Distribution Date to
Gemstone Acquisition Corporation or its assignee allocable to Additional
Interest.
Each Distribution Date Statement shall be accompanied by the corresponding
Updated Mortgage Loan Schedule. The corresponding Collection Report will be
provided by electronic medium (including computer diskette) to those Holders of
any Classes of Regular Certificates who so request and each of the Rating
Agencies. Insofar as any of the information to be provided pursuant to clauses
(i) through (xxvii) above is adequately reflected in the Updated Mortgage Loan
Schedule, such information need not be repeated in the Distribution Date
Statement provided that the Trustee shall only be obligated to deliver the
Updated Mortgage Loan Schedule to the extent such document is delivered to it by
the Master Servicer in accordance with Section 3.12(c); and provided further
that notwithstanding the fact that any of the Registered Certificates are held
in the name of the Depository or its nominee, the Trustee shall be required on
each Distribution Date to deliver the related Distribution Date Statement and
corresponding Updated Mortgage Loan Schedule to each holder of Registered
Certificates set forth on Exhibit K hereto. In addition, each such Distribution
Date Statement and Updated Mortgage Loan Schedule, as applicable, shall refer to
the Mortgage Loan Number for each Mortgage Loan set forth on Exhibit B hereto.
In the case of information to be furnished pursuant to clauses (i) through
(iv) above, the amounts shall be expressed as a dollar amount in the aggregate
for all Certificates
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of each applicable Class and per Single Certificate. In the case of information
provided to the Trustee by the Master Servicer as a basis for information to be
furnished pursuant to clauses (x) through (xiv), (xxv) and (xxvi) above, insofar
as the underlying information is solely within the control of the Special
Servicer, the Master Servicer may, absent manifest error, conclusively rely on
the reports to be provided by the Special Servicer.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a Regular Certificate a statement containing the information set
forth in clauses (i) through (iv) and (xxvii) above as to the applicable Class,
aggregated for the portion of such calendar year that such Person was a Holder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the REMIC
Administrator pursuant to any requirements of the Code as from time to time are
in force.
On each Distribution Date, the Trustee shall forward to the Depositor, to
each Rating Agency, to each Holder of a Residual Certificate, to Merrill Lynch &
Co. (at 101 Hudson Street, 12th Floor, Jersey City, New Jersey 07302-3997,
Attention: P&I Dept., or such other address as Merrill Lynch & Co. may hereafter
designate), to Daiwa Securities America Inc. (at Financial Square, 32 Old Slip,
New York, New York 10005, Attention: Richard Lerner and Samuel Kirschner, or
such other address as Daiwa may hereafter designate) and, in the case of reports
regarding the respective Classes of Book-Entry Certificates, if any, to The
Trepp Group (at 477 Madison Avenue, 18th Floor, New York, New York 10022, or
such other address as The Trepp Group may hereafter designate), a copy of the
reports forwarded to the Holders of the Regular Certificates on such
Distribution Date and a statement setting forth the amounts, if any, actually
distributed with respect to the Class R-I and Class R-II Certificates on such
Distribution Date.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall furnish to each Person who at any time during the calendar year
was a Holder of a Residual Certificate a statement containing the information
provided pursuant to the previous paragraph in respect of distributions on each
Class of Residual Certificates and pursuant to clauses (i) through (iv) and
(xxvii) above in respect of distributions on each Class of Regular Certificates,
aggregated for the portion of such calendar year that such Person was a Holder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the
Trustee pursuant to any requirements of the Code as from time to time are in
force.
Upon written request of any of the Rating Agencies, the Depositor or either
Underwriter, without payment of any fee, and upon written request of any
Certificateholders or any other Person, together with payment of a reasonable
fee specified by the Trustee, the Trustee shall provide any statements, reports
and/or information contemplated by this Section 4.02(a) on computer diskette to
such party (such computer diskette and such statements, reports, and/or
information thereon to bear such appropriate disclaimers and qualifications as
the Depositor and the Trustee shall determine in their reasonable discretion).
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The Trustee shall only be obligated to deliver the statements, reports and
information contemplated by this Section 4.02(a) to the extent it receives the
necessary underlying information from the Master Servicer and the Special
Servicer and shall not be liable for any failure to deliver any thereof on the
prescribed due dates, to the extent caused by failure to receive timely such
underlying information. Nothing herein shall obligate the Trustee, the Special
Servicer or the Master Servicer to violate any applicable law prohibiting
disclosure of information with respect to any Mortgagor or to breach any
confidentiality provision in a Mortgage Loan document or lease with respect to
any Mortgaged Property and the failure of the Trustee, Master Servicer or the
Special Servicer to disseminate information for such reason shall not be a
breach hereof. Either of the Master Servicer and Special Servicer shall be
permitted to attach any disclaimer, with respect to any information provided to
it, to any statement it delivers that it deems appropriate.
The information to be furnished by the Trustee to the Certificateholders
pursuant to Sections 4.02(a) and (b) shall not limit the Trustee in furnishing
any such information to other Persons to whom it determines such disclosure to
be appropriate and shall not limit the Trustee in furnishing to
Certificateholders or to any person any other information with respect to the
Mortgage Loans, the Mortgaged Properties or the Trust as may be provided to it
by the Depositor, the Master Servicer or the Special Servicer or gathered by it
in any investigation or other manner from time to time (such information, other
than as described in Sections 4.02(a) and (b), is referred to herein as
"Additional Information") as it may reasonably deem necessary or appropriate
from time to time (provided, however, that it shall have no obligation to do
so), provided that (A) the Trustee shall give the Depositor three business days'
advance notice before doing so, (B), except with respect to the Controlling
Class Representative, prior to any Event of Default, any such Additional
Information shall only be furnished with the consent or at the request of the
Depositor (except pursuant to clause (E) below), (C) the Trustee shall be
entitled to indicate the source of all information furnished by it, and the
Trustee may affix thereto any disclaimer it deems appropriate in its discretion,
(D) the Trustee shall notify Certificateholders of the availability of any such
information in any manner as it, in its sole discretion, may determine and (E)
this provision shall not prevent the Trustee, whether with or without the
consent of the Depositor, from furnishing information with respect to the Trust
Fund and its administration thereof to any Person, if it reasonably determines
that the furnishing of such information is required by applicable law. Prior to
an Event of Default, the Trustee shall forward to the Depositor any requests for
Additional Information which, for their fulfillment, require the consent of the
Depositor. Nothing herein shall be construed to impose upon the Trustee any
obligation or duty to furnish or distribute any Additional Information to any
Person in any instance.
(b) Not later than 4:00 P.M. on the fourth Business Day following each
Determination Date and in any event no later than the third Business Day prior
to the related Distribution Date, the Master Servicer (with respect to that
information on Exhibit L hereto) shall furnish to the Trustee and the Depositor
(for receipt by each not later than such fourth Business Day following each
Determination Date), by electronic transmission (or in such other form to which
the Trustee, the Depositor and the Master Servicer may agree), with a hard
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copy of such transmitted information to follow not later than the fifth Business
Day following such Determination Date, an accurate and complete Collection
Report with respect to the related Distribution Date containing the following
information (but only if and to the extent such information is not already
adequately reflected in the corresponding Updated Mortgage Loan Schedule
delivered by the Master Servicer to the Trustee pursuant to Section 3.12(c)):
(i) with respect to each Mortgage Loan (and any successor REO Loan)
that was included in the Trust Fund as of the commencement of the
Collection Period ending on such Determination Date, (A) the Master
Servicer loan number thereof, (B) the Mortgage Rate and Net Mortgage Rate
in effect as of the commencement of such Collection Period, (C) the Stated
Principal Balance outstanding immediately before and expected to be
outstanding immediately after the related Distribution Date, (D) the date
on which the final payment is scheduled to be due, (E) the amount of the
Monthly Payment due on the Due Date in such Collection Period, (F) all
related payment and/or collection activity since the preceding Collection
Report (or, in the case of the initial Collection Report, since the Closing
Date) relevant to the Paying Agent's calculations of amounts to be
distributed on the Certificates on the related Distribution Date and the
application of such amounts in accordance with Section 3.02(b) (or the
definition of "REO Loan"), (G) the delinquency status as of the end of such
Collection Period, (H) in the case of an REO Loan, the date of acquisition
of the related REO Property by the Trust Fund and the book value (within
the meaning of 12 C.F.R. ss.571.13) of such REO Property, (I) whether a
Liquidation Event occurred during such Collection Period and, if so, a
brief description thereof, and (J) the amount of any loss incurred during
such Collection Period;
(ii) the information to be provided to Certificateholders on the
related Distribution Date pursuant to clauses (v), (vi), (x)-(xiv),
(xxv)(A), and (xxvi) of Section 4.02(a);
(iii) the aggregate amount of the Prepayment Premiums received during
such Collection Period;
(iv) such other information regarding the Mortgage Loan or related
Mortgage Property and any REO Properties as the Trustee may reasonably
request to perform its duties hereunder; and
(v) to the extent the Depositor or any Certificateholder requests
additional information not required pursuant to the terms of this
Agreement, the Trustee may, subject to the provisions of Section 4.02(a)
request such information in order to deliver the same to the Depositor or
such Certificateholder on the Distribution Date following the Depositor's
or such Certificateholder's reasonable request therefor (or if such request
is made after the fifth Business Day preceding such Distribution Date, the
next succeeding
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Distribution Date), to the extent such information is readily available to
the Master Servicer or Special Servicer without additional cost or expense
for which the Master Servicer or Special Servicer will not be reimbursed.
In the performance of its obligations set forth in Section 4.05 and its
other duties hereunder, the Trustee may conclusively rely on the Collection
Reports and Updated Mortgage Loan Schedules provided to it by the Master
Servicer or the Special Servicer, and the Trustee shall not be responsible to
recompute, recalculate or verify the information provided to it by the Master
Servicer or the Special Servicer. In the case of information to be furnished by
the Master Servicer to the Trustee pursuant to this Section 4.02(b), insofar as
such information is solely within the control of the Special Servicer, the
Master Servicer shall have no obligation to provide such information until it
has received such information from the Special Servicer and may, absent manifest
error, conclusively rely on the reports to be provided by the Special Servicer.
The Special Servicer shall provide to the Master Servicer the information set
forth in Section 4.02(b)(i) and Section 4.02(a)(x-xiv) and (xxvi) with respect
to any Specially Serviced Mortgage Loan and REO Loan serviced by it as of the
Due Date for the related Collection Report. The Master Servicer and the Special
Servicer shall be entitled to rely on information received from third parties in
providing information to the Trustee, unless it has knowledge that such
information is incorrect or would have had such knowledge if it were acting in
accordance with the Servicing Standard.
SECTION 4.03. P&I Advances.
(a) On or before 4:00 p.m., New York City time, on each P&I Advance Date,
the Master Servicer shall (i) apply amounts held in the Certificate Account
received after the Determination Date with respect to the related Collection
Period or for future distribution to Certificateholders in subsequent months in
discharge of its obligation to make P&I Advances, or (ii) if such amounts are
insufficient to discharge such obligation, subject to Section 4.03(c) below,
remit from its own funds to the Paying Agent for deposit into the Distribution
Account an amount equal to the aggregate amount of P&I Advances, if any, to be
made in respect of the related Distribution Date. The Master Servicer may also
make P&I Advances in the form of any combination of clauses (i) and (ii) above
aggregating the total amount of P&I Advances to be made. Any amounts held in the
Certificate Account for future distribution and so used to make P&I Advances
shall be appropriately reflected in the Master Servicer's records and replaced
by the Master Servicer by deposit in the Certificate Account on or before the
next succeeding Determination Date (to the extent not previously replaced
through the deposit of Late Collections of the delinquent principal and interest
in respect of which such P&I Advances were made). If, as of 4:00 p.m., New York
City time, on any P&I Advance Date, the Master Servicer shall not have made any
P&I Advance required to be made on such date pursuant to this Section 4.03(a)
(and shall not have delivered to the Trustee the requisite Officer's Certificate
and documentation related to a determination of nonrecoverability of a P&I
Advance), then the Trustee shall provide notice of such failure to a Servicing
Officer of the Master Servicer by facsimile transmission sent to telecopy no.
281-405-7153 (or such alternative number provided by the Master Servicer to the
Trustee in writing) and by telephone at telephone no. 281-405-7007 (or such
alternative number provided
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by the Master Servicer to the Trustee in writing) as soon as possible, but in
any event before 5:00 p.m., New York City time, on such P&I Advance Date. If the
Trustee does not receive the full amount of such P&I Advances by 4:00 p.m., New
York City time, on such P&I Advance Date, then, subject to Section 4.03(c), (i)
the Trustee shall, no later than 11:00 a.m., New York City time, on the
Distribution Date immediately following such P&I Advance Date make the portion
of such P&I Advances that was required to be, but was not, made by the Master
Servicer on such P&I Advance Date and (ii) the provisions of Sections 7.01 and
7.02 shall apply. If the Trustee fails to make any P&I Advance required to be
made under this Section 4.03(a), the Fiscal Agent shall, subject to Section
4.03(c), make such P&I Advance not later than 2:00 p.m., New York City time, on
such Distribution Date and, if the Fiscal Agent makes such P&I Advance the
Trustee shall not be in default under this Agreement.
(b) The aggregate amount of P&I Advances to be made by the Master Servicer,
the Trustee or the Fiscal Agent in respect of any Distribution Date shall,
subject to Section 4.03(c) below, equal the aggregate of all Scheduled Payments
(other than Balloon Payments) and any Assumed Scheduled Payments, net of related
Servicing Fees, Special Servicing Fees and any related Principal Recovery Fees,
due or deemed due, as the case may be, in respect of the Mortgage Loans
(including, without limitation, Balloon Mortgage Loans delinquent as to their
respective Balloon Payments) and any REO Loans on their respective Due Dates
during the related Collection Period, in each case to the extent such amount was
not paid by or on behalf of the related Mortgagor or otherwise collected
(including received as net income from REO Properties) as of the close of
business on the related Determination Date; provided that, (i) if the Monthly
Payment on any Mortgage Loan has been reduced in connection with a bankruptcy or
similar proceeding involving the related Mortgagor or a modification, waiver or
amendment granted or agreed to by the Special Servicer pursuant to Section 3.20,
or if the final maturity on any Mortgage Loan shall be extended in connection
with a bankruptcy or similar proceeding involving the related Mortgagor or a
modification, waiver or amendment granted or agreed to by the Special Servicer
pursuant to Section 3.20, and the Monthly Payment due and owing during the
extension period is less than the related Assumed Scheduled Payment, then the
Master Servicer shall, as to such Mortgage Loan only, advance only the amount of
the Monthly Payment due and owing after taking into account such reduction (net
of related Servicing Fees, Special Servicing Fees and any related Principal
Recovery Fees) in the event of subsequent delinquencies thereon; and (ii) if it
is determined that an Appraisal Reduction Amount exists with respect to any
Required Appraisal Loan, then, with respect to the Distribution Date immediately
following the date of such determination and with respect to each subsequent
Distribution Date for so long as such Appraisal Reduction Amount exists with
respect to such Required Appraisal Loan, the Master Servicer, the Trustee or the
Fiscal Agent will be required in the event of subsequent delinquencies to
advance in respect of such Mortgage Loan only an amount equal to the product of
(i) the amount of the P&I Advance that would otherwise be required without
regard to this sentence, multiplied by (ii) a fraction, the numerator of which
is equal to the Stated Principal Balance of such Mortgage Loan, net of such
Appraisal Reduction Amount, and the denominator of which is equal to the Stated
Principal Balance of such Mortgage Loan.
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(c) Notwithstanding anything herein to the contrary, no P&I Advance shall
be required to be made hereunder if such P&I Advance would, if made, constitute
a Nonrecoverable P&I Advance. The determination by the Master Servicer that it
has made a Nonrecoverable P&I Advance or that any proposed P&I Advance, if made,
would constitute a Nonrecoverable P&I Advance, shall be evidenced by an
Officers' Certificate delivered to the Trustee, the Fiscal Agent and the
Depositor on or before the related P&I Advance Date, setting forth the basis for
such determination, together with any other information, including Appraisals
or, if no such Appraisal has been performed pursuant to this Section 4.03(c), a
copy of an Appraisal of the related Mortgaged Property performed within the
twelve months preceding such determination, related Mortgagor operating
statements and financial statements, budgets and rent rolls of the related
Mortgaged Properties, engineers' reports, environmental surveys and any similar
reports that the Master Servicer may have obtained consistent with the Servicing
Standard and at the expense of the Trust Fund, that support such determination
by the Master Servicer. The Trustee and the Fiscal Agent shall be entitled to
rely, conclusively, on any determination by the Master Servicer that a P&I
Advance, if made, would be a Nonrecoverable Advance (and with respect to a P&I
Advance, the Trustee or the Fiscal Agent, as applicable, shall rely on the
Master Servicer's determination that the P&I Advance would be a Nonrecoverable
Advance if the Trustee or Fiscal Agent, as applicable, determines that it does
not have sufficient time to make such determination); provided, however, that if
the Master Servicer has failed to make a P&I Advance for reasons other than a
determination by the Master Servicer that such P&I Advance would be
Nonrecoverable Advance, the Trustee or Fiscal Agent, as applicable, shall make
such Advance within the time periods required by Section 4.03(a) unless the
Trustee or the Fiscal Agent, in good faith, makes a determination prior to the
times specified in Section 4.03(a) that such P&I Advance would be a
Nonrecoverable Advance. The Trustee and the Fiscal Agent, in determining whether
or not a P&I Advance previously made is, or a proposed P&I Advance, if made,
would be, a Nonrecoverable Advance shall be subject to the standards applicable
to the Master Servicer hereunder.
(d) In connection with the recovery by the Master Servicer, the Trustee or
the Fiscal Agent of any P&I Advance out of the Certificate Account pursuant to
Section 3.05(a), the Master Servicer shall be entitled to pay itself, the
Trustee or the Fiscal Agent out of any amounts then on deposit in the
Certificate Account, interest at the Reimbursement Rate in effect from time to
time, accrued on the amount of such P&I Advance from the date made to but not
including the date of reimbursement. The Master Servicer shall reimburse itself,
the Trustee or the Fiscal Agent for any outstanding P&I Advance in accordance
with Section 3.05(a) as soon as practicable.
SECTION 4.04. Allocation of Realized Losses and Additional Trust Fund
Expenses.
(a) On each Distribution Date, prior to the distributions to be made on
such date pursuant to Section 4.01, the Paying Agent shall allocate to the
respective Classes of Regular Certificates as follows the aggregate of all
Realized Losses and Additional Trust Fund Expenses that were incurred at any
time following the Cut-off Date through the end of the
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related Collection Period, and in any event that were not previously allocated
pursuant to this Section 4.04(a) on any prior Distribution Date, but only to the
extent that (i) the aggregate Certificate Principal Balance of the Regular
Certificates as of such Distribution Date (after taking into account all of the
distributions made on such Distribution Date pursuant to Section 4.01), exceeds
(ii) the aggregate Stated Principal Balance of the Mortgage Pool to be
outstanding immediately following such Distribution Date: first, to the Class J
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; second, to the Class H Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; third, to the Class G
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; fourth, to the Class F Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; fifth, to the Class E
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; sixth, to the Class D Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; seventh, to the Class C
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; eighth, to the Class B Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; and ninth, to the Class A-1,
Class A-2 and Class A-3 Certificates, pro rata, in accordance with the
outstanding Certificate Principal Balances of such Classes of Certificates,
until the remaining Class Principal Balance of each such Class has been reduced
to zero. Any allocation of Realized Losses and Additional Trust Fund Expenses to
a Class of Regular Certificates shall be made by reducing the Class Principal
Balance thereof by the amount so allocated. All Realized Losses and Additional
Trust Fund Expenses, if any, allocated to a Class of Regular Certificates shall
be allocated among the respective Certificates of such Class in proportion to
the Percentage Interests evidenced thereby. All Realized Losses and Additional
Trust Fund Expenses, if any, that have not been allocated to the Regular
Certificates as of the Distribution Date on which the aggregate Certificate
Principal Balance of such Certificates has been reduced to zero, shall be deemed
allocated to the Residual Certificates.
(b) Each Realized Loss and Additional Trust Fund Expense, if any, allocated
to the Class A-1 Certificates on any Distribution Date shall be deemed to have
first been allocated to REMIC II Regular Interest P with a corresponding
reduction in the Uncertificated Principal Balance of such REMIC II Regular
Interest; each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class A-2 Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest Q with a corresponding
reduction in the Uncertificated Principal Balance of such REMIC II Regular
Interest; each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class A-3 Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest R with a corresponding
reduction in the Uncertificated Principal Balance of such REMIC II Regular
Interest; each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class B Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest S with a corresponding
reduction in the Uncertificated Principal Balance of such REMIC II Regular
Interest; each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class C Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest T with a corresponding
reduction in the Uncertificated Principal Balance of such
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REMIC II Regular Interest; each Realized Loss and Additional Trust Fund Expense,
if any, allocated to the Class D Certificates on any Distribution Date shall be
deemed to have first been allocated to REMIC II Regular Interest U with a
corresponding reduction in the Uncertificated Principal Balance of such REMIC II
Regular Interest; each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class E Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest V with a corresponding
reduction in the Uncertificated Principal Balance of such REMIC II Regular
Interest; each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class F Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest W, with a
corresponding reduction in the Uncertificated Principal Balance of such REMIC II
Regular Interest; each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class G Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest X, with a
corresponding reduction in the Uncertificated Principal Balance of such REMIC II
Regular Interest; each Realized Loss and Additional Trust Fund Expenses, if any,
allocated to the Class H Certificates on any Distribution Date shall be deemed
to have first been allocated to REMIC II Regular Interest Y, with a
corresponding reduction in the Uncertificated Principal Balance of such REMIC II
Regular Interest; and each Realized Loss and Additional Trust Fund Expense, if
any, allocated to the Class J Certificates on any Distribution Date shall be
deemed to have first been allocated to REMIC II Regular Interest Z, with a
corresponding reduction in the Uncertificated Principal Balance of such REMIC II
Regular Interest.
SECTION 4.05. Calculations.
The Paying Agent shall, provided it receives the necessary information from
the Master Servicer and the Special Servicer, be responsible for performing all
calculations necessary in connection with the actual and deemed distributions
and allocations to be made pursuant to Section 4.01, Section 5.02(d) and Article
IX and the actual and deemed allocations of Realized Losses and Additional Trust
Fund Expenses to be made pursuant to Section 4.04. The Paying Agent shall
calculate the Available Distribution Amount for each Distribution Date and shall
allocate such amount among Certificateholders in accordance with this Agreement,
and the Paying Agent shall have no obligation to recompute, recalculate or
verify any information provided to it by the Special Servicer or Master
Servicer. The calculations by the Paying Agent of such amounts shall, in the
absence of manifest error, be presumptively deemed to be correct for all
purposes hereunder.
SECTION 4.06. Use of Agents.
The Master Servicer or the Trustee may at its own expense utilize agents or
attorneys-in-fact in performing any of its obligations under this Article IV
(except the obligation to make P&I Advances), but no such utilization shall
relieve the Master Servicer or the Trustee from any of such obligations, and the
Master Servicer or the Trustee, as applicable, shall remain responsible for all
acts and omissions of any such agent or attorney-in-fact (other than with
respect to powers-of-attorney delivered by the Trustee to the Master Servicer of
Special Servicer pursuant to Section 2.03(b) and 3.01(b), as applicable, in
which case the Trustee shall have no such responsibility). The Master Servicer
or the Trustee shall
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have all the limitations upon liability and all the indemnities for the actions
and omissions of any such agent or attorney-in-fact that it has for its own
actions hereunder pursuant to Article VI or Article VIII hereof, as applicable,
and any such agent or attorney-in-fact shall have the benefit of all the
limitations upon liability, if any, and all the indemnities provided to the
Master Servicer under Section 6.03 or to the Trustee under Sections 8.01, 8.02
and 8.05, as applicable.
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ARTICLE V
THE CERTIFICATES
SECTION 5.01. The Certificates.
(a) The Certificates will be substantially in the respective forms attached
hereto as Exhibits A-1, A-2, A-3, A-4, A-5, A-6, A-7, A-8, A-9, A-10, A-11,
A-12, A-13, A-14 and A-15; provided that any of the Certificates may be issued
with appropriate insertions, omissions, substitutions and variations, and may
have imprinted or otherwise reproduced thereon such legend or legends, not
inconsistent with the provisions of this Agreement, as may be required to comply
with any law or with rules or regulations pursuant thereto, or with the rules of
any securities market in which the Certificates are admitted to trading, or to
conform to general usage. The Certificates will be issuable in registered form
only; provided, however, that in accordance with Section 5.03 beneficial
ownership interests in the Registered Certificates shall initially be held and
transferred through the book-entry facilities of the Depository. The Regular
Certificates will be issuable only in denominations corresponding to initial
Certificate Principal Balances or initial Certificate Notional Amount, as the
case may be, as of the Closing Date of not less than $1,000 in the case of the
Registered Certificates, and not less than $250,000 in the case of the Class F,
Class G, Class H and Class J Certificates, and in each such case in integral
multiples of $1 in excess thereof.
(b) The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by the Certificate Registrar hereunder by an authorized
signatory. Certificates bearing the manual or facsimile signatures of
individuals who were at any time the authorized officers of the Certificate
Registrar shall be entitled to all benefits under this Agreement, subject to the
following sentence, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of such
Certificates or did not hold such offices at the date of such Certificates. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, however, unless there appears on such Certificate a certificate
of authentication substantially in the form provided for herein executed by the
Authenticating Agent by manual signature, and such certificate of authentication
upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication.
SECTION 5.02. Registration of Transfer and Exchange of Certificates.
(a) At all times during the term of this Agreement, there shall be
maintained at the office of the Certificate Registrar a Certificate Register in
which, subject to such reasonable regulations as the Certificate Registrar may
prescribe, the Certificate Registrar shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
The Trustee is hereby initially appointed (and hereby agrees to act in
accordance with the terms hereof) as Certificate Registrar for the purpose of
registering Certificates and transfers and exchanges of Certificates as herein
provided. The Certificate Registrar may appoint, by a written instrument
delivered to the Depositor, the Trustee (if the
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Trustee is not the Certificate Registrar), the Special Servicer and the Master
Servicer, any other bank or trust company to act as Certificate Registrar under
such conditions as the predecessor Certificate Registrar may prescribe, provided
that the predecessor Certificate Registrar shall not be relieved of any of its
duties or responsibilities hereunder by reason of such appointment. If the
Trustee resigns or is removed in accordance with the terms hereof, the successor
trustee shall immediately succeed to its duties as Certificate Registrar. The
Depositor, the Trustee (if it is no longer the Certificate Registrar), the
Master Servicer and the Special Servicer shall have the right to inspect the
Certificate Register or to obtain a copy thereof at all reasonable times, and to
rely conclusively upon a certificate of the Certificate Registrar as to the
information set forth in the Certificate Register. Upon written request of any
Certificateholder made for purposes of communicating with other
Certificateholders with respect to their rights under this Agreement, the
Certificate Registrar shall promptly furnish such Certificateholder with a list
of the other Certificateholders of record identified in the Certificate Register
at the time of the request.
(b) No transfer of any Non-Registered Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction that does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor or its
Affiliates), then the Certificate Registrar shall refuse to register such
transfer unless it receives (and upon receipt, may conclusively rely upon)
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit F-I hereto, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit F-2 hereto or as Exhibit F-3 hereto; or
(ii) an Opinion of Counsel satisfactory to the Certificate Registrar to the
effect that such transfer may be made without registration under the Securities
Act (which Opinion of Counsel shall not be an expense of the Trust Fund or of
the Depositor, the Master Servicer, the Special Servicer, the Trustee or the
Certificate Registrar in their respective capacities as such), together with the
written certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify any Class of Non-Registered Certificates under
the Securities Act or any other securities law or to take any action not
otherwise required under this Agreement to permit the transfer of any
Non-Registered Certificate without registration or qualification. Any Holder of
a Non-Registered Certificate desiring to effect such a transfer shall, and upon
acquisition of such a Certificate shall be deemed to have agreed to, indemnify
the Trustee, the Certificate Registrar and the Depositor against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
(c) No transfer of a Subordinated Certificate or any interest therein shall
be made (A) to any employee benefit plan or other retirement arrangement,
including individual retirement accounts and annuities, Keogh plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested, that is subject to ERISA
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or the prohibited transactions restrictions of Section 4975 of the Code (each, a
"Plan"), or (B) to any Person who is directly or indirectly purchasing such
Subordinated Certificate or interest therein on behalf of, as named fiduciary
of, as trustee of, or with assets of a Plan (including, without limitation, any
insurance company using assets in its general or separate account that may
constitute "plan assets" of a Plan); provided that (i) such a transfer may be
made to an insurance company general account with respect to any Class of
Subordinated Certificates which is eligible for exemptive relief under Section
III of Prohibited Transaction Class Exemption 95-60 ("PTE 95-60"), provided that
the proposed transferee certifies that the conditions of Sections I, III and IV
of PTE 95-60 are satisfied with respect to such transfer, and (ii) such a
transfer may be made with respect to a Class F, Class G, Class H or Class J
Certificate if the prospective transferee provides the Certificate Registrar
with a certification of facts and an Opinion of Counsel (upon which the
Certificate Registrar may conclusively rely) which establish to the satisfaction
of the Certificate Registrar that such transfer will not result in a violation
of Section 406 of ERISA or Section 4975 of the Code or result in the imposition
of an excise tax under Section 4975 of the Code. As a condition to its
registration of the transfer of a Subordinated Certificate, the Certificate
Registrar shall have the right to require the prospective transferee of such
Certificate, if it is not a Plan or Person described in clause (B) of the
preceding sentence, to execute a certification affidavit to that effect in the
form attached as Exhibit G hereto.
(d) (i) Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably authorized the Paying Agent under clause (ii)(A) below to
deliver payments to a Person other than such Person and to have irrevocably
authorized the Certificate Registrar under clause (ii)(B) below to negotiate the
terms of any mandatory sale and to execute all instruments of Transfer and to do
all other things necessary in connection with any such sale. The rights of each
Person acquiring any Ownership Interest in a Residual Certificate are expressly
subject to the following provisions:
(A) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Master Servicer, the Paying Agent and the Certificate Registrar
of any change or impending change in its status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership Interest
in a Residual Certificate, the Certificate Registrar shall require delivery
to it, and shall not register the Transfer of any Residual Certificate
until its receipt of an affidavit and agreement substantially in the form
attached hereto as Exhibit H-1 (in any case, a "Transfer Affidavit and
Agreement"), from the proposed Transferee, in form and substance
satisfactory to the Certificate Registrar, and upon which the Certificate
Registrar may, in the absence of actual knowledge by a Responsible Officer
of either the Trustee or the Certificate
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Registrar to the contrary, conclusively rely, representing and warranting,
among other things, that such Transferee is a Permitted Transferee, that it
is not acquiring its Ownership Interest in the Residual Certificate that is
the subject of the proposed Transfer as a nominee, trustee or agent for any
Person that is not a Permitted Transferee, that for so long as it retains
its Ownership Interest in a Residual Certificate, it will endeavor to
remain a Permitted Transferee, and that it has reviewed the provisions of
this Section 5.02(d) and agrees to be bound by them.
(C) Notwithstanding the delivery of a Transfer Affidavit and Agreement
by a proposed Transferee under clause (B) above, if a Responsible Officer
of the Certificate Registrar has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership
Interest in a Residual Certificate to such proposed Transferee shall be
effected.
(D) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (1) to require a Transfer Affidavit and
Agreement from any prospective Transferee to whom such Person attempts to
transfer its Ownership Interest in such Residual Certificate and (2) not to
transfer its Ownership Interest in such Residual Certificate unless it
provides to the Certificate Registrar a certificate substantially in the
form attached hereto as Exhibit H-2 stating that, among other things, it
has no actual knowledge that such prospective Transferee is not a Permitted
Transferee.
(E) Each Person holding or acquiring an Ownership Interest in a
Residual Certificate, by purchasing an Ownership Interest in such
Certificate, agrees to give the Master Servicer and the Trustee written
notice that it is a "pass-through interest holder" within the meaning of
temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately upon
acquiring an Ownership Interest in a Residual Certificate, if it is, or is
holding an Ownership Interest in a Residual Certificate on behalf of, a
pass-through interest holder".
(ii) (A) If any purported Transferee shall become a Holder of a Residual
Certificate in violation of the provisions of this Section 5.02(d), then the
last preceding Holder of such Residual Certificate that was in compliance with
the provisions of this Section 5.02(d) shall be restored, to the extent
permitted by law, to all rights as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. None of the Trustee,
the Master Servicer or the Certificate Registrar shall be under any liability to
any Person for any registration of Transfer of a Residual Certificate that is in
fact not permitted by this Section 5.02(d) or for making any payments due on
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such Certificate to the Holder thereof or for taking any other action with
respect to such Holder under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of a Residual
Certificate in violation of the restrictions in this Section 5.02(d) and to
the extent that the retroactive restoration of the rights of the Holder of
such Residual Certificate as described in clause (ii)(A) above shall be
invalid, illegal or unenforceable, then the Certificate Registrar shall
have the right, but not the obligation, without notice to the Holder or any
prior Holder of such Residual Certificate, to sell such Residual
Certificate to a purchaser selected by the REMIC Administrator on such
terms as the Certificate Registrar may choose. Such purported Transferee
shall promptly endorse and deliver such Residual Certificate in accordance
with the instructions of the Certificate Registrar. Such purchaser may be
the Certificate Registrar itself or any Affiliate of the Certificate
Registrar. The proceeds of such sale, net of the commissions (which may
include commissions payable to the Certificate Registrar or its
Affiliates), expenses and taxes due, if any, will be remitted by the Paying
Agent to such purported Transferee. The terms and conditions of any sale
under this clause (ii)(B) shall be determined in the sole discretion of the
Certificate Registrar, and the Certificate Registrar shall not be liable to
any Person having an Ownership Interest in a Residual Certificate as a
result of its exercise of such discretion.
(iii) The Certificate Registrar shall make available to the Internal
Revenue Service and to those Persons specified by the REMIC Provisions any
information available to it which is necessary to compute any tax imposed (A) as
a result of the Transfer of an Ownership Interest in a Residual Certificate to
any Person who is a Disqualified Organization, including the information
described in Treasury regulations sections 1.860D-1(b)(5) and 1.860E-2(a)(5)
with respect to the "excess inclusions" of such Residual Certificate and (B) as
a result of any regulated investment company, real estate investment trust,
common trust fund, partnership, trust, estate or organization described in
Section 1381 of the Code that holds an Ownership Interest in a Residual
Certificate having as among its record holders at any time any Person which is a
Disqualified Organization, and the Master Servicer and the Special Servicer
shall furnish to the Certificate Registrar all information in its possession
necessary for the Certificate Registrar to discharge such obligation. The Person
holding such Ownership Interest shall be responsible for the reasonable
compensation of the Certificate Registrar, the Master Servicer and the Special
Servicer for providing such information.
(iv) The provisions of this Section 5.02(d) set forth prior to this clause
(iv) may be modified, added to or eliminated, provided that there shall have
been delivered to the Certificate Registrar and the Master Servicer the
following:
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(A) written confirmation from each Rating Agency to the effect that
the modification of, addition to or elimination of such provisions will not
cause such Rating Agency to downgrade its then-current rating of any Class
of Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory to the
Certificate Registrar and the Master Servicer, obtained at the expense of
the party seeking such modification of, addition to or elimination of such
provisions (but in no event at the expense of the Trust or the Trust Fund),
to the effect that doing so will not cause either of REMIC I, REMIC II or
REMIC III to (x) cease to qualify as a REMIC or (y) be subject to an
entity-level tax caused by the Transfer of any Residual Certificate to a
Person which is not a Permitted Transferee, or cause a Person other than
the prospective Transferee to be subject to a REMIC-related tax caused by
the Transfer of a Residual Certificate to a Person that is not a Permitted
Transferee.
(e) Subject to the preceding provisions of this Section 5.02, upon
surrender for registration of transfer of any Certificate at the offices of the
Certificate Registrar maintained for such purpose, the Certificate Registrar
shall execute and the Authenticating Agent shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Certificates of the same Class of a like aggregate Percentage Interest.
(f) At the option of any Holder, its Certificates may be exchanged for
other Certificates of authorized denominations of the same Class of a like
aggregate Percentage Interest, upon surrender of the Certificates to be
exchanged at the offices of the Certificate Registrar maintained for such
purpose. Whenever any Certificates are so surrendered for exchange, the
Certificate Registrar shall execute and the Authenticating Agent shall
authenticate and deliver the Certificates which the Certificateholder making the
exchange is entitled to receive.
(g) Every Certificate presented or surrendered for transfer or exchange
shall (if so required by the Certificate Registrar) be duly endorsed by, or be
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder thereof or his attorney duly
authorized in writing.
(h) No service charge shall be imposed for any transfer or exchange of
Certificates, but the Certificate Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(i) All Certificates surrendered for transfer and exchange shall be
physically canceled by the Certificate Registrar, and the Certificate Registrar
shall dispose of such canceled Certificates in accordance with its standard
procedures.
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(j) Upon request, the Certificate Registrar shall provide to the Master
Servicer, the Special Servicer and the Depositor notice of each transfer of a
Certificate and shall provide to each such Person with an updated copy of the
Certificate Register.
SECTION 5.03. Book-Entry Certificates.
(a) Each Class of Registered Certificates shall initially be issued as one
or more Certificates registered in the name of the Depository or its nominee
and, except as provided in Section 5.03(c) below, transfer of such Certificates
may not be registered by the Certificate Registrar unless such transfer is to a
successor Depository that agrees to hold such Certificates for the respective
Certificate Owners with Ownership Interests therein. Such Certificate Owners
shall hold and transfer their respective Ownership Interests in and to such
Certificates through the book-entry facilities of the Depository and, except as
provided in Section 5.03(c) below, shall not be entitled to definitive, fully
registered Certificates ("Definitive Certificates") in respect of such Ownership
Interests. All transfers by Certificate Owners of their respective Ownership
Interests in the Book-Entry Certificates shall be made in accordance with the
procedures established by the Depository Participant or brokerage firm
representing each such Certificate Owner. Each Depository Participant shall only
transfer the Ownership Interests in the Book-Entry Certificates of Certificate
Owners it represents or of brokerage firms for which it acts as agent in
accordance with the Depository's normal procedures.
(b) The Trustee, the Master Servicer, the Special Servicer, the Depositor
and the Certificate Registrar may for all purposes, including the making of
payments due on the Book-Entry Certificates, deal with the Depository as the
authorized representative of the Certificate Owners with respect to such
Certificates for the purposes of exercising the rights of Certificateholders
hereunder. The rights of Certificate Owners with respect to the Book-Entry
Certificates shall be limited to those established by law and agreements between
such Certificate Owners and the Depository Participants and brokerage firms
representing such Certificate Owners. Multiple requests and directions from, and
votes of, the Depository as Holder of the Book-Entry Certificates with respect
to any particular matter shall not be deemed inconsistent if they are made with
respect to different Certificate Owners. The Trustee may establish a reasonable
record date in connection with solicitations of consents from or voting by
Certificateholders and shall give notice to the Depository of such record date.
(c) If (i)(A) the Depositor advises the Trustee and the Certificate
Registrar in writing that the Depository is no longer willing or able to
properly discharge its responsibilities with respect to a Class of the
Book-Entry Certificates, and (B) the Depositor is unable to locate a qualified
successor, or (ii) the Depositor at its option advises the Trustee and the
Certificate Registrar in writing that it elects to terminate the book-entry
system through the Depository with respect to a Class of Book-Entry
Certificates, the Certificate Registrar shall notify all affected Certificate
Owners, through the Depository, of the occurrence of any such event and of the
availability of Definitive Certificates to such Certificate Owners requesting
the same. Upon surrender to the Certificate Registrar of the Book-Entry
Certificates of any
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Class thereof by the Depository, accompanied by registration instructions from
the Depository for registration of transfer, the Certificate Registrar shall
execute, at the Depositor's expense, and the Authenticating Agent shall
authenticate and deliver, the Definitive Certificates in respect of such Class
to the Certificate Owners identified in such instructions. The Depositor shall
provide the Certificate Registrar with an adequate inventory of Definitive
Certificates. None of the Depositor, the Master Servicer, the Special Servicer,
the Trustee or the Certificate Registrar shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Certificates for purposes of evidencing ownership of any Class of Registered
Certificates, the registered holders of such Definitive Certificates shall be
recognized as Certificateholders hereunder and, accordingly, shall be entitled
directly to receive payments on, to exercise Voting Rights with respect to, and
to transfer and exchange such Definitive Certificates.
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (ii) there is delivered
to the Trustee and the Certificate Registrar such security or indemnity as may
be required by them to save each of them harmless, then, in the absence of
actual notice to the Trustee or the Certificate Registrar that such Certificate
has been acquired by a bona fide purchaser, the Certificate Registrar shall
execute and the Authenticating Agent shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a
new Certificate of the same Class and like Percentage Interest. Upon the
issuance of any new Certificate under this Section, the Trustee and the
Certificate Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee and the
Certificate Registrar) connected therewith. Any replacement Certificate issued
pursuant to this Section shall constitute complete and indefeasible evidence of
ownership in the applicable REMIC created hereunder, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.
SECTION 5.05. Persons Deemed Owners.
Prior to due presentment for registration of transfer, the Depositor, the
Master Servicer, the Special Servicer, the Trustee, the Certificate Registrar
and any agent of any of them may treat the Person in whose name any Certificate
is registered as the owner of such Certificate for the purpose of receiving
distributions pursuant to Section 4.01 and for all other purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Certificate Registrar or any agent of any of them shall be affected by
notice to the contrary.
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ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER, THE SPECIAL SERVICER
AND THE CONTROLLING CLASS REPRESENTATIVE
SECTION 6.01. Liability of Depositor, Master Servicer and Special Servicer.
The Depositor, the Master Servicer and the Special Servicer shall be liable
in accordance herewith only to the extent of the respective obligations
specifically imposed upon and undertaken by the Depositor, the Master Servicer
and the Special Servicer herein.
SECTION 6.02. Merger, Consolidation or Conversion of Depositor or Master
Servicer or Special Servicer.
Subject to the following paragraph, the Depositor, the Master Servicer and
the Special Servicer shall each keep in full effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation, and each will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
The Depositor, the Master Servicer or the Special Servicer may be merged or
consolidated with or into any Person, or transfer all or substantially all of
its assets to any Person, in which case any Person resulting from any merger or
consolidation to which the Depositor, the Master Servicer or the Special
Servicer shall be a party, or any Person succeeding to the business of the
Depositor, the Master Servicer or the Special Servicer, shall be the successor
of the Depositor, the Master Servicer or the Special Servicer, as the case may
be, hereunder, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that no successor or surviving Person shall
succeed to the rights of the Master Servicer or the Special Servicer unless (i)
as evidenced in writing by the Rating Agencies, such succession will not result
in qualification, downgrading or withdrawal of the ratings then assigned by the
Rating Agencies to any Class of Certificates; and (ii) in the case of a
successor or surviving Person to the Master Servicer, such successor or
surviving Person shall have a net worth (or, in the case of the initial Master
Servicer, such successor or surviving Person and its immediate parent shall have
a consolidated net worth) of not less than $15,000,000.
SECTION 6.03. Limitation on Liability of Depositor, Master Servicer and
Special Servicer.
None of the Depositor, the Master Servicer or the Special Servicer shall be
under any liability to the Trust Fund, the Trustee or the Certificateholders for
any action taken, or not taken, in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect the
Depositor, the Master Servicer or
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the Special Servicer against any liability to the Trust Fund, the Trustee or the
Certificateholders for the breach of a representation, warranty or covenant made
herein by such party, or against any expense or liability specifically required
to be borne by such party without right of reimbursement pursuant to the terms
hereof, or against any liability which would otherwise be imposed by reason of
misfeasance, bad faith or negligence in the performance of obligations or duties
hereunder. The Depositor, the Master Servicer, the Special Servicer and any
director, officer, employee or agent of the Depositor, the Master Servicer or
the Special Servicer may rely in good faith on any document of any kind which,
prima facie, is properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor, the Master Servicer, the Special
Servicer and any director, officer, employee or agent of the Depositor, the
Master Servicer or the Special Servicer shall be indemnified and held harmless
by the Trust Fund against any loss, liability or reasonable expense incurred in
connection with this Agreement or the Certificates, other than any loss,
liability or expense: (i) specifically required to be borne by such party
without right of reimbursement pursuant to the terms hereof; (ii) incurred in
connection with any breach of a representation, warranty or covenant made
herein; or (iii) incurred by reason of willful misfeasance, bad faith or
negligence in the performance of obligations or duties hereunder. None of the
Depositor, the Master Servicer or the Special Servicer shall be under any
obligation to appear in, prosecute or defend any legal action unless such action
is related to its respective duties under this Agreement and, unless it is
specifically required hereunder to bear the costs of such legal action, in its
opinion does not involve it in any ultimate expense or liability; provided,
however, that the Depositor, the Master Servicer or the Special Servicer may in
its discretion undertake any such action which it may deem necessary or
desirable with respect to the enforcement and/or protection of the rights and
duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such action, and any
liability resulting therefrom, shall constitute a Servicing Advance, and the
Depositor, the Master Servicer and the Special Servicer shall be entitled to be
reimbursed therefor from the Certificate Account as provided in Section 3.05. In
no event shall the Master Servicer or the Special Servicer be liable or
responsible for any action taken or omitted to be taken by the other of them or
by the Depositor, the Trustee or any Certificateholder, subject to the
provisions of the last paragraph of Section 8.05.
SECTION 6.04. Resignation of Master Servicer and the Special Servicer;
Assignment of Rights and Obligations
The Master Servicer and, subject to Section 6.09, the Special Servicer
shall resign from the obligations and duties hereby imposed on it, upon a
determination that its duties hereunder are no longer permissible under
applicable law or are in material conflict by reason of applicable law with any
other activities carried on by it (the other activities of the Master Servicer
or the Special Servicer, as the case may be, so causing such a conflict being of
a type and nature carried on by the Master Servicer or the Special Servicer, as
the case may be, at the date of this Agreement). Any such determination
requiring the resignation of the Master Servicer or the Special Servicer, as
applicable, shall be evidenced by an Opinion of Counsel to such effect which
shall be delivered to the Trustee. Unless applicable law requires the Master
Servicer's or Special Servicer's resignation to be effective immediately, and
the
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Opinion of Counsel delivered pursuant to the prior sentence so states, no
such resignation shall become effective until the Trustee or other successor
shall have assumed the responsibilities and obligations of the resigning party
in accordance with Section 7.02 hereof. The Master Servicer and the Special
Servicer shall have the right to resign at any other time and the Master
Servicer shall have the right to assign its rights and obligations pursuant to
this Agreement to a third party; provided that, with respect to the successor to
either the Master Servicer or the Special Servicer, (i) each of the Rating
Agencies confirms in writing that the successor's appointment or the assignment
by the Master Servicer, as the case may be, will not result in a withdrawal,
qualification or downgrade of any rating or ratings assigned to any Class of
Certificates, (ii) the resigning or assigning party pays all costs and expenses
in connection with such transfer, (iii) the successor accepts appointment prior
to the effectiveness of such resignation; and (iv) in the event of assignment by
the Master Servicer to a third party, such third party satisfies all of the
requirements for a successor Master Servicer set forth in Section 7.02(a).
Consistent with the foregoing, neither the Master Servicer nor the Special
Servicer shall, except as expressly provided herein, assign or transfer any of
its rights, benefits or privileges hereunder to any other Person, or, except as
provided in Sections 3.22 and 4.06, delegate to or subcontract with, or
authorize or appoint any other Person to perform any of the duties, covenants or
obligations to be performed by it hereunder unless the requirements for
resignation set forth in the immediately preceding sentence are met. If,
pursuant to any provision hereof, the duties of the Master Servicer or the
Special Servicer are transferred to a successor thereto, the entire amount of
compensation payable to the Master Servicer or the Special Servicer, as the case
may be, that accrues pursuant hereto from and after the date of such transfer
shall be payable to such successor.
SECTION 6.05. Rights of Depositor and Trustee in Respect of Master Servicer
and the Special Servicer.
The Master Servicer and the Special Servicer shall each afford the
Depositor and the Trustee, upon reasonable notice, during normal business hours
access to all records maintained thereby in respect of its rights and
obligations hereunder and access to officers thereof responsible for such
obligations. Upon reasonable request, the Master Servicer and the Special
Servicer shall each furnish the Depositor and the Trustee with its most recent
financial statements and such other information as it possesses, and which it is
not prohibited by applicable law or contract from disclosing, regarding its
business, affairs, property and condition, financial or otherwise, except to the
extent such information constitutes proprietary information or is subject to a
privilege under applicable law. The Depositor may, but is not obligated to,
enforce the obligations of the Master Servicer and the Special Servicer
hereunder and may, but is not obligated to, perform, or cause a designee to
perform, any defaulted obligation of the Master Servicer or Special Servicer
hereunder or exercise the rights of the Master Servicer and the Special Servicer
hereunder; provided, however, that neither the Master Servicer nor the Special
Servicer shall be relieved of any of its obligations hereunder by virtue of such
performance by the Depositor or its designee and, further provided, that the
Depositor may not exercise any right pursuant to Section 7.01 to terminate the
Master Servicer
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or the Special Servicer as a party to this Agreement. The Depositor shall not
have any responsibility or liability for any action or failure to act by the
Master Servicer or the Special Servicer and is not obligated to supervise the
performance of the Master Servicer or the Special Servicer under this Agreement
or otherwise.
SECTION 6.06. Depositor, Master Servicer and Special Servicer to Cooperate
with Trustee.
The Depositor, the Master Servicer and the Special Servicer shall each
furnish such reports, certifications and information as are reasonably requested
by the Trustee in order to enable it to perform its duties hereunder.
SECTION 6.07. Depositor, Special Servicer and Trustee to Cooperate with
Master Servicer.
The Depositor, the Special Servicer and the Trustee shall each furnish such
reports, certifications and information as are reasonably requested by the
Master Servicer in order to enable it to perform its duties hereunder.
SECTION 6.08. Depositor, Master Servicer and Trustee to Cooperate with
Special Servicer.
The Depositor, the Master Servicer and the Trustee shall each furnish such
reports, certifications and information as are reasonably requested by the
Special Servicer in order to enable it to perform its duties hereunder.
SECTION 6.09. Designation of Special Servicer by the Controlling Class.
The Holder or Holders of the Certificates evidencing a majority of the
Voting Rights allocated to the Controlling Class may at any time and from time
to time designate a Person meeting the requirements set forth in Section 6.02 to
serve as Special Servicer hereunder and to replace any existing Special Servicer
or any Special Servicer that has resigned or otherwise ceased to serve as
Special Servicer; provided, however, any costs or expenses incurred in
connection with the replacement by such Holders or Holders of any Special
Servicer previously appointed by such Holder or Holders, for which the
circumstances of such replacement are other than those resulting from the
resignation or termination of the Special Servicer pursuant to Sections 6.04 and
7.01, respectively, shall be borne by the Controlling Class. Such Holder or
Holders may also select a representative (the "Controlling Class
Representative") from whom the Special Servicer will seek advice and approval
and take direction under certain circumstances, as described herein. Such Holder
or Holders shall so designate a Person to so serve by the delivery to the
Trustee, the Master Servicer and the existing Special Servicer of a written
notice stating such designation. The Trustee shall, promptly after receiving any
such notice, deliver to the Rating Agencies an executed Notice and
Acknowledgment in the form attached hereto as Exhibit I-1. If such Holders have
not replaced the Special Servicer within 30 days of such Special Servicer's
resignation or the date such Special Servicer has ceased to serve in such
capacity the Trustee shall utilize its best
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efforts to designate a successor Special Servicer meeting the requirements set
forth in Sections 6.02 and 7.02. The designated Person shall become the Special
Servicer on the date that the Trustee shall have received written confirmation
from all of the Rating Agencies that the appointment of such Person will not
result in the qualification, downgrading or withdrawal of the rating or ratings
assigned to one or more Classes of the Certificates. The appointment of such
designated Person as Special Servicer shall also be subject to receipt by the
Trustee of (1) an Acknowledgment of Proposed Special Servicer in the form
attached hereto as Exhibit I-2, executed by the designated Person and (ii) an
Opinion of Counsel (at the expense of the Person designated to become the
Special Servicer) to the effect that the designation of such Person to serve as
Special Servicer is in compliance with this Section 6.09 and all other
applicable provisions of this Agreement, that upon the execution and delivery of
the Acknowledgment of Proposed Special Servicer the designated Person shall be
bound by the terms of this Agreement and that this Agreement shall be
enforceable against the designated Person in accordance with its terms. Any
existing Special Servicer shall be deemed to have resigned simultaneously with
such designated Person's becoming the Special Servicer hereunder; provided,
however, that the resigning or terminated Special Servicer shall continue to be
entitled to receive all amounts accrued or owing to it under this Agreement on
or prior to the effective date of such resignation, whether in respect of
Servicing Advances or otherwise, including, without limitation, any Principal
Recovery Fee or proportionate share thereof, and it shall continue to be
entitled to the benefits of Section 6.03 notwithstanding any such resignation.
Such resigning Special Servicer shall cooperate with the Trustee and the
replacement Special Servicer in effecting the termination of the resigning
Special Servicer's responsibilities and rights hereunder, including, without
limitation, the transfer within two Business Days to the replacement Special
Servicer for administration by it of all cash amounts that shall at the time be
or should have been credited by the Special Servicer to the REO Account or
delivered to the Master Servicer or that are thereafter received with respect to
Specially Serviced Mortgage Loans and REO Properties.
SECTION 6.10. Master Servicer or Special Servicer as Owner of a
Certificate.
The Master Servicer or an Affiliate of the Master Servicer or the Special
Servicer or an Affiliate of the Special Servicer may become the Holder of (or,
in the case of a Book-Entry Certificate, Certificate Owner with respect to) any
Certificate with the same rights it would have if it were not the Master
Servicer or the Special Servicer or an Affiliate thereof. If, at any time during
which the Master Servicer or the Special Servicer or an Affiliate of the Master
Servicer or the Special Servicer is the Holder of (or, in the case of a
Book-Entry Certificate, Certificate Owner with respect to) any Certificate, the
Master Servicer or the Special Servicer proposes to take action (including for
this purpose, omitting to take action) that (i) is not expressly prohibited by
the terms hereof and would not, in the Master Servicer's or the Special
Servicer's good faith judgment, violate the Servicing Standard, and (ii) if
taken, might nonetheless, in the Master Servicer's or the Special Servicer's
good faith judgment, be considered by other Persons to violate the Servicing
Standard, the Master Servicer or the Special Servicer may (but need not) seek
the approval of the Certificateholders to such action by delivering to the
Trustee a written notice that (a) states that it is delivered pursuant to this
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Section 6.10, (b) identifies the Percentage Interest in each Class of
Certificates beneficially owned by the Master Servicer or the Special Servicer
or an Affiliate of the Master Servicer or the Special Servicer, and (c)
describes in reasonable detail the action that the Master Servicer or the
Special Servicer proposes to take. The Trustee, upon receipt of such notice,
shall forward it to the Certificateholders (other than the Master Servicer and
its Affiliates or the Special Servicer and its Affiliates, as appropriate),
together with such instructions for response as the Trustee shall reasonably
determine. If at any time Certificateholders holding greater than 50% of the
Voting Rights of all Certificateholders (calculated without regard to the
Certificates beneficially owned by the Master Servicer or its Affiliates or the
Special Servicer or its Affiliates) shall have failed to object in writing to
the proposal described in the written notice, and if the Master Servicer or the
Special Servicer shall act as proposed in the written notice within fifteen (15)
days, such action shall be deemed to comply with the Servicing Standard. The
Trustee shall be entitled to reimbursement from the Master Servicer or the
Special Servicer, as applicable, for the reasonable expenses of the Trustee
incurred pursuant to this paragraph. It is not the intent of the foregoing
provision that the Master Servicer or the Special Servicer be permitted to
invoke the procedure set forth herein with respect to routine servicing matters
arising hereunder, but rather in the case of unusual circumstances.
SECTION 6.11. The Controlling Class Representative.
The Controlling Class Representative will be entitled to advise the Special
Servicer with respect to the following actions of the Special Servicer, and the
Special Servicer will not be permitted to take any of the following actions
unless the Controlling Class Representative has approved such action in writing
within ten Business Days (provided that if such written notice has not been
received by the Special Servicer within ten Business Days, then the Controlling
Class Representative's approval will be deemed to have been given):
(i) any foreclosure upon or comparable conversion (which may include
acquisitions of an REO Property) of the ownership of properties securing
such of the Specially Serviced Mortgage Loans as come into and continue in
default;
(ii) any modification of a monetary term of a Mortgage Loan other than
a modification consisting of the extension of the maturity date of a
Mortgage Loan for one year or less;
(iii) any proposed sale of a defaulted Mortgage Loan or REO Property
(other than in connection with the termination of the Trust Fund);
(iv) any determination to bring an REO Property into compliance with
applicable environmental laws;
(v) any acceptance of substitute or additional collateral for a
Mortgage Loan;
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(vi) any waiver of a "due-on-sale" or "due-on-encumbrance" clause; and
(vii) any acceptance of an assumption agreement releasing a borrower
from liability under a Mortgage Loan.
In addition, the Controlling Class Representative may direct the Special
Servicer to take, or to refrain from taking, such other actions as the
Controlling Class Representative may deem advisable or as to which provision is
otherwise made herein; provided that no such direction or approval rights
provided in this Section 6.11 may require or cause the Special Servicer to
violate any provision of this Agreement or the REMIC Provisions, including the
Special Servicer's obligation to act in accordance with the Servicing Standard
or expose the Master Servicer, the Special Servicer, the Trust Fund or the
Trustee to liability, or materially expand the scope of the Special Servicer's
responsibilities hereunder. Any reasonable out-of-pocket expenses incurred by
the Special Servicer in connection with its obtaining the approval of the
Controlling Class Representative shall be treated as a Servicing Advance and the
Special Servicer shall be entitled to reimbursement in respect thereof pursuant
to Section 3.05(a).
In the event the Special Servicer determines that any direction or
objection of the Controlling Class Representative would cause the Special
Servicer to violate this Agreement, expose the Master Servicer, the Special
Servicer, the Trust Fund or Trustee to liability or materially expand the scope
of the Special Servicer's responsibilities, the Special Servicer shall notify
the Controlling Class Representative. The sole remedy of the Controlling Class
Representative shall be to seek removal of the Special Servicer and the Special
Servicer shall have no other liability with respect to such action. Any such
removal shall be deemed a removal of the Special Servicer without cause.
The Controlling Class Representative will have no liability to the
Certificateholders for any action taken, or for refraining from the taking of
any action, in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that the Controlling Class Representative will not be
protected against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
or by reason of reckless disregard of obligations or duties. By its acceptance
of a Certificate, each Certificateholder confirms its understanding that the
Controlling Class Representative may take actions that favor the interests of
one or more Classes of the Certificates over other Classes of the Certificates,
and that the Controlling Class Representative may have special relationships and
interests that conflict with those of holders of some Classes of the
Certificates and, absent willful misfeasance, bad faith or gross negligence on
the part of the Controlling Class Representative, agrees to take no action
against the Controlling Class Representative or any of its officers, directors,
employees, principals or agents as a result of such a special relationship or
conflict.
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ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default.
(a) "Event of Default", wherever used herein, means any one of the
following events:
(i) any failure by the Master Servicer to deposit into the Certificate
Account, or to deposit into, or remit to the Paying Agent for deposit into,
the Additional Interest Distribution Account or the Distribution Account,
any amount (other than a P&I Advance) required to be so deposited or
distributed by it under this Agreement; or
(ii) any failure by the Special Servicer to deposit into the REO
Account or to deposit into, or to remit to the Master Servicer for deposit
into, the Certificate Account any amount required to be so deposited or
remitted under this Agreement; or
(iii) any failure on the part of the Master Servicer or the Special
Servicer duly to observe or perform in any material respect any other of
the covenants or agreements on the part of the Master Servicer or the
Special Servicer, as the case may be, contained in this Agreement which
continues unremedied for a period of 30 days after the date on which
written notice of such failure, requiring the same to be remedied, shall
have been given to the Master Servicer and the Special Servicer by any
other party hereto or to the Master Servicer or the Special Servicer, as
the case may be (with a copy to each other party hereto), by the Holders of
Certificates entitled to at least 25% of the Voting Rights; or
(iv) any breach on the part of the Master Servicer or the Special
Servicer of any representation or warranty contained in this Agreement that
materially and adversely affects the interests of any Class of
Certificateholders and which continues unremedied for a period of 30 days
after the date on which notice of such breach, requiring the same to be
remedied, shall have been given to the Master Servicer or the Special
Servicer, as the case may be, by any other party hereto or to the Master
Servicer or the Special Servicer, as the case may be (with a copy to each
other party hereto), by the Holders of Certificates entitled to at least
25% of the Voting Rights; or
(v) a decree or order of a court or agency or supervisory authority
having jurisdiction in the premises in an involuntary case under any
present or future federal or state bankruptcy, insolvency or similar law
for the appointment of a conservator, receiver, liquidator, trustee or
similar official in
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any bankruptcy, insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding-up or liquidation of
its affairs, shall have been entered against the Master Servicer or the
Special Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or
(vi) the Master Servicer or the Special Servicer shall consent to the
appointment of a conservator, receiver, liquidator, trustee or similar
official in any bankruptcy, insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to it or of or
relating to all or substantially all of its property; or
(vii) the Master Servicer or the Special Servicer shall admit in
writing its inability to pay its debts generally as they become due, file a
petition to take advantage of any applicable bankruptcy, insolvency or
reorganization statute, make an assignment for the benefit of its
creditors, voluntarily suspend payment of its obligations, or take any
corporate action in furtherance of the foregoing; or
(viii) the consolidated net worth of the Master Servicer and of its
direct or indirect parent, determined in accordance with generally accepted
accounting principles, shall decline to less than $15,000,000; or
(ix) the Trustee shall have received a written notice from a Rating
Agency to the effect that if the Master Servicer or Special Servicer
continues to act in such capacity, the rating or ratings on one or more
Classes of Certificates will be qualified, downgraded or withdrawn and the
Trustee shall not have received a subsequent notice from such Rating Agency
(within 90 days of receipt of the first notice) indicating anything to the
contrary (and upon the 91st day the provisions of Section 7.01(b) shall
apply); or
(x) the Master Servicer shall fail to remit to the Paying Agent for
deposit into the Distribution Account by 4:00 p.m. on any P&I Advance Date,
the full amount of P&I Advances required to be made on such date; provided,
however, that if such failure to remit by 4:00 p.m. on any P&I Advance Date
occurs only once in any consecutive twelve month period, which failure is
corrected by 10:00 a.m., New York City time on the immediately following
Distribution Date, then with respect to such one failure only, a default
shall be deemed not to have occurred.
When a single entity acts as the Master Servicer and the Special Servicer, an
Event of Default in one capacity shall constitute an Event of Default in the
other capacity.
(b) If any Event of Default described in clauses (i) - (viii) of subsection
(a) above shall occur with respect to the Master Servicer or the Special
Servicer (in either case,
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for purposes of this Section 7.01(b), the "Defaulting Party") and shall be
continuing, then, and in each and every such case, so long as such Event of
Default shall not have been remedied, the Trustee may, and at the written
direction of the Holders of Certificates entitled to at least 25% of the Voting
Rights, the Trustee shall, by notice in writing to the Defaulting Party (with a
copy of such notice to each other party hereto) and the Rating Agencies
terminate all of the rights and obligations (but not the liabilities for actions
and omissions occurring prior thereto) of the Defaulting Party under this
Agreement and in and to the Trust Fund, other than its rights as a
Certificateholder hereunder; provided that, if GECAM is terminated as initial
Master Servicer hereunder, such termination shall not preclude GECAM from
serving, subject to Section 3.22, as a Sub-Servicer in respect of the GECAM
Mortgage Loans or any other Mortgage Loans. If an Event of Default described in
clause (ix) or (x) of subsection (a) above shall occur with respect to the
Master Servicer or, if applicable, the Special Servicer (in either case, under
such circumstances, for purposes of this Section 7.01(b), the "Defaulting
Party"), the Trustee shall, by notice in writing (to be sent immediately by
facsimile transmission) to the Defaulting Party (with a copy of such notice to
each other party hereto) and the Rating Agencies, terminate all of the rights
(except as set forth below) and obligations (but not the liabilities for actions
and omissions occurring prior thereto) of the Defaulting Party under this
Agreement and in and to the Trust Fund, other than its rights, if any, as a
Certificateholder hereunder. From and after the receipt by the Defaulting Party
of such written notice of termination, all authority and power of the Defaulting
Party under this Agreement, whether with respect to the Certificates (other than
as a holder of any Certificate) or the Mortgage Loans or otherwise, shall pass
to and be vested in the Trustee pursuant to and under this Section, and, without
limitation, the Trustee is hereby authorized and empowered to execute and
deliver, on behalf of and at the expense of the Defaulting Party, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. The Master Servicer and the Special Servicer each agree that, if it
is terminated pursuant to this Section 7.01(b), it shall promptly (and in any
event no later than ten Business Days subsequent to its receipt of the notice of
termination) provide the Trustee with all documents and records, including those
in electronic form, requested thereby to enable the Trustee to assume the Master
Servicer's or Special Servicer's, as the case may be, functions hereunder, and
shall cooperate with the Trustee in effecting the termination of the Master
Servicer's or Special Servicer's, as the case may be, responsibilities and
rights hereunder, including, without limitation, (i) the immediate transfer to
the Trustee or a successor Master or Special Servicer for administration by it
of all cash amounts that shall at the time be or should have been credited by
the Master Servicer to the Certificate Account, the Distribution Account or a
Servicing Account (if the Master Servicer is the Defaulting Party) or that are
thereafter received by or on behalf of it with respect to any Mortgage Loan or
(ii) the transfer within two Business Days to the Trustee or a successor Special
Servicer for administration by it of all cash amounts that shall at the time be
or should have been credited by the Special Servicer to the REO Account, the
Certificate Account or a Servicing Account or delivered to the Master Servicer
(if the Special Servicer is the Defaulting Party) or that are thereafter
received by or on behalf of it with respect to any Mortgage Loan or REO Property
(provided, however, that the Master Servicer and the Special Servicer each
shall, if terminated
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pursuant to this Section 7.01(b), continue to be entitled to receive all amounts
accrued or owing to it under this Agreement on or prior to the date of such
termination, whether in respect of Advances or otherwise, and it shall continue
to be entitled to the benefits of Section 6.03 notwithstanding any such
termination). Any cost or expenses in connection with any actions to be taken by
the Master Servicer or Special Servicer pursuant to this paragraph shall be
borne by the Defaulting Party and if not paid by the Defaulting Party within 90
days after the presentation of reasonable documentation of such costs and
expenses, such expense shall be reimbursed by the Trust Fund; provided, however,
that the Defaulting Party shall not thereby be relieved of its liability for
such expenses. If and to the extent that the Defaulting Party has not reimbursed
such costs and expenses, the Trustee shall have an affirmative obligation to
take all reasonable actions to collect such expenses on behalf of and at the
expense of the Trust Fund. For purposes of this Section 7.01 and of Section
7.03(b), the Trustee shall not be deemed to have knowledge of an event which
constitutes, or which with the passage of time or notice, or both, would
constitute an Event of Default described in clauses (i)-(x) of subsection (a)
above unless a Responsible Officer of the Trustee assigned to and working in the
Asset Backed Securities Group of the Trustee's Corporate Trust Division has
actual knowledge thereof or unless notice of any event which is in fact such an
Event of Default is received by a Responsible Officer of the Trustee and such
notice references the Certificates, the Trust Fund or this Agreement.
SECTION 7.02. Trustee to Act; Appointment of Successor.
(a) On and after the time the Master Servicer or the Special Servicer
resigns pursuant to Section 6.04 or receives a notice of termination pursuant to
Section 7.01, the Trustee shall be the successor in all respects to the Master
Servicer or the Special Servicer, as the case may be, in its capacity as such
under this Agreement and the transactions set forth or provided for herein and
shall have (and the former Master Servicer or the Special Servicer, as the case
may be, shall cease to have) all the responsibilities, duties and liabilities of
the Master Servicer or the Special Servicer, as the case may be, arising
thereafter, including, without limitation, if the Master Servicer is the
resigning or terminated party, the Master Servicer's obligation to make P&I
Advances, including, without limitation, in connection with any termination of
the Master Servicer for an Event of Default described in clause 7.01(a)(x), the
unmade P&I Advances that gave rise to such Event of Default; provided that if
the Master Servicer is the resigning or terminated party, and if the Trustee is
prohibited by law or regulation from obligating itself to make P&I Advances (as
evidenced by an Opinion of Counsel delivered to the Depositor and the Rating
Agencies) the Trustee shall not be obligated to make such P&I Advances; and
provided, further, that any failure to perform such duties or responsibilities
caused by the Master Servicer's or the Special Servicer's, as the case may be,
failure to provide information or monies required by Section 7.01 shall not be
considered a default by the Trustee hereunder. The Trustee shall not be liable
for any of the representations and warranties of the resigning or terminated
party or for any losses incurred by the resigning or terminated party pursuant
to Section 3.06 hereunder nor shall the Trustee be required to purchase any
Mortgage Loan hereunder. As compensation therefor, the Trustee shall, subject to
paragraph (b) of this Section 7.02, be entitled to all fees and other
compensation which the resigning or terminated party would have been entitled to
if the
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resigning or terminated party had continued to act hereunder. Notwithstanding
the above, the Trustee may, if it shall be unwilling to so act as either Master
Servicer or Special Servicer, as the case may be, or shall, if it is unable to
so act as either Master Servicer or Special Servicer, as the case may be, if the
Trustee is not approved as a Master Servicer or a Special Servicer, as the case
may be, by any of the Rating Agencies or if the Holders of Certificates entitled
to at least 51% of the Voting Rights so request in writing to the Trustee,
promptly appoint, subject to the approval of each of the Rating Agencies (as
evidenced by written confirmation therefrom to the effect that the appointment
of such institution would not cause the qualification, downgrading or withdrawal
of the then current rating on any Class of Certificates) or petition a court of
competent jurisdiction to appoint, any established mortgage loan servicing
institution that meets the requirements of Section 6.02 and provided further,
that in the case of the resignation or termination of GECAM pursuant to the
terms of this Agreement, the Trustee will in good faith attempt to appoint a
successor Master Servicer at a Successor Servicing Fee Rate intended to minimize
the amount of any Servicing Fee Increase and within 90 days of such resignation
or termination, the Trustee shall deliver to GECAM an Officer's Certificate of
the Trustee that sets forth the methods employed by the Trustee in attempting to
appoint a successor Master Servicer and the proposed Successor Servicing Fee bid
by any potential successor Master Servicer approached by the Trustee, as the
successor to the Master Servicer or the Special Servicer, as the case may be,
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Master Servicer or the Special Servicer, as the case may
be, hereunder; provided, however, that in the case of a resigning or terminated
Special Servicer, such appointment shall be subject to the rights of the Holders
of Certificates evidencing a majority of the Voting Rights allocated to the
Controlling Class to designate a successor pursuant to Section 6.09. Except with
respect to an appointment provided below, no appointment of a successor to the
Master Servicer or the Special Servicer hereunder shall be effective until the
assumption of the successor to such party of all its responsibilities, duties
and liabilities under this Agreement. Pending appointment of a successor to the
Master Servicer or the Special Servicer hereunder, the Trustee shall act in such
capacity as hereinabove provided. Notwithstanding the above, the Trustee shall,
if the Master Servicer is the resigning or terminated party, and the Trustee is
prohibited by law or regulation from making P&I Advances, promptly appoint any
established mortgage loan servicing institution that has a net worth of not less
than $15,000,000 and is otherwise acceptable to each Rating Agency (as evidenced
by written confirmation therefrom to the effect that the appointment of such
institution would not cause the qualification, downgrading or withdrawal of the
then current rating on any Class of Certificates), as the successor to the
Master Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer hereunder
(including, without limitation, the obligation to make P&I Advances), which
appointment will become effective immediately. In connection with any such
appointment and assumption described herein, the Trustee may make such
arrangements for the compensation of such successor out of payments on the
Mortgage Loans as it and such successor shall agree; provided, however, that,
subject to paragraph (b) of this Section 7.02, no such compensation shall be in
excess of that permitted the resigning or terminated party hereunder. Such
successor and the other parties hereto shall take such action, consistent with
this Agreement, as shall be necessary to effectuate any such succession.
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(b) In the event the Trustee (a) continues as successor Master Servicer for
more than three months from the date it becomes the successor Master Servicer or
(b) appoints a successor Master Servicer pursuant to paragraph (a) of this
Section 7.02, GECAM shall, on each Determination Date subsequent to such event,
remit to the Trustee for deposit into the Collection Account an amount equal to
the Servicing Fee Increase. If as of 3:00 p.m., New York City time on any
Determination Date, GECAM shall not have remitted the Servicing Fee Increase as
required pursuant to this Section 7.02(b), then the Trustee shall provide notice
of such failure to GECAM and GECC by facsimile transmission sent to telecopy No.
(281) 405-7153 (or such alternative numbers provided by GECAM or GECC to the
Trustee in writing), and by telephone at telephone nos. (281) 405-7000 and (281)
405-7007, respectively (or such alternative numbers provided by GECAM or GECC to
the Trustee in writing) as soon as possible, but in any event before 10:00 a.m.,
New York City time on the next Business Day. If the Trustee does not receive the
full amount of the Servicing Fee Increase by 11:00 a.m., New York City time, on
the Business Day immediately following such Determination Date, then GECC shall
remit to the Trustee the full amount of the Servicing Fee Increase (less any
amount thereof remitted by GECAM) not later that 2:00 p.m., New York City time
on the next Business Day.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any resignation of the Master Servicer or the Special Servicer
pursuant to Section 6.04, any termination of the Master Servicer or the Special
Servicer pursuant to Section 7.01, any appointment of a successor to the Master
Servicer or the Special Servicer pursuant to Section 7.02 or the effectiveness
of any designation of a new Special Servicer pursuant to Section 6.09, the
Trustee shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register.
(b) Not later than the later of (i) 60 days after the occurrence of any
event which constitutes or, with notice or lapse of time or both, would
constitute an Event of Default and (ii) five days after a Responsible Officer of
the Trustee has notice of the occurrence of such an event, the Trustee shall
transmit by mail to the Depositor and all Certificateholders and the Rating
Agencies notice of such occurrence, unless such default shall have been cured.
SECTION 7.04. Waiver of Events of Default.
The Holders representing at least 66-2/3% of the Voting Rights allocated to
the Classes of Certificates affected by any Event of Default hereunder may waive
such Event of Default; provided, however, that an Event of Default under clauses
(i), (ii) or (x) of Section 7.01(a) may be waived only by all of the
Certificateholders of the affected Classes. Upon any such waiver of an Event of
Default, such Event of Default shall cease to exist and shall be deemed to have
been remedied for every purpose hereunder. No such waiver shall extend to any
subsequent or other Event of Default or impair any right consequent thereon
except to the extent expressly so waived. Notwithstanding any other provisions
of this Agreement, for purposes of waiving any Event of Default pursuant to this
Section 7.04, Certificates registered
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in the name of the Depositor or any Affiliate of the Depositor shall be entitled
to Voting Rights with respect to the matters described above.
SECTION 7.05. Additional Remedies of Trustee Upon Event of Default.
During the continuance of any Event of Default, so long as such Event of
Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 7.01, shall have the right, in its own name and as trustee
of an express trust, to take all actions now or hereafter existing at law, in
equity or by statute to enforce its rights and remedies and to protect the
interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filings of proofs of claim and debt in connection
therewith). Except with respect to an Event of Default pursuant to Section
7.01(a)(ix) for which the sole remedy shall be the termination of the Master
Servicer (other than any obligations of the Master Servicer pursuant to Section
7.02) and as otherwise expressly provided in this Agreement, no remedy provided
for by this Agreement shall be exclusive of any other remedy, and each and every
remedy shall be cumulative and in addition to any other remedy, and no delay or
omission to exercise any right or remedy shall impair any such right or remedy
or shall be deemed to be a waiver of any Event of Default.
SECTION 7.06. Obligations of GECC.
(a) (i) It shall not be necessary for the Trustee (and GECC hereby waives
any rights which GECC may have to require the Trustee), in order to enforce the
obligations of GECC hereunder, first to (w) institute suit or exhaust its
remedies against GECAM or others liable on the obligations or any other person,
(x) enforce the Trustee's rights against any other obligors of the GECC
Obligations, (y) join GECAM or any others liable pursuant to Section 7.02(b)
hereof in any action seeking to enforce Section 7.02(b) and this Section 7.06,
or (z) resort to any other means of obtaining payment or performance of the GECC
Obligations. Except as otherwise provided herein, the Trustee shall not be
required to mitigate damages or to take any other action to reduce, collect or
enforce the GECC Obligations.
(ii) GECC agrees to pay to the Trustee, on demand, all costs and expenses
paid or incurred by the Trustee in enforcing GECC's payment of the GECC
Obligations. The covenant contained in this Section 7.06(a)(ii) shall survive
the payment and performance of the GECC Obligations.
(iii) In the event that, pursuant to any insolvency, bankruptcy,
reorganization, receivership or other debtor relief law, or any judgment, order
or decision thereunder, the Trustee must rescind or restore any payment, or any
part thereof, received by the Trustee in satisfaction of amounts payable
pursuant to Section 7.02(b) hereof, as set forth herein, any prior release or
discharge from the terms of this Section 7.06 given to GECC by the Trustee shall
be without effect, and this Section 7.06 shall remain in full force and effect
and be restored as to such GECC Obligations. It is the intention of GECAM and
GECC that GECC's obligations are discharged with respect to any Distribution
Date, upon GECAM's performance pursuant to Section 7.02(b) subject to the
preceding sentence.
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(b) GECC hereby represents and warrants to the Trustee, for its own benefit
and for the benefit of the Certificateholders, and to the Depositor that:
(i) GECC is an affiliate of GECAM, and has received, or will receive,
direct or indirect benefit from entering into this Agreement.
(ii) Neither the Trustee nor any other party has made any
representation, warranty or statement to GECC in order to induce GECC to
enter into this Agreement.
(iii) As of the date hereof, and after giving effect to this Section
7.06 and the obligation evidenced hereby, GECC is, and will be, solvent,
and has and will have assets which, fairly valued, exceed its obligations,
liabilities (including contingent liabilities) and debts, and has and will
have property and assets sufficient to satisfy and repay its obligations
and liabilities.
(iv) The execution, delivery and performance by GECC of this Agreement
does not, and will not, violate GECC's articles of incorporation or by-laws
or contravene or conflict with any law, statute or regulation which affects
materially and adversely either the ability of GECC to perform the GECC
Obligations or the financial condition of GECC or constitute a default (or
an event which with notice or lapse of time or both would constitute a
default) under, or result in the breach of, any material indenture,
mortgage, deed of trust, charge, lien, or any contract, agreement or other
instrument to which GECC is a party or which may be applicable to GECC.
GECC has no off-set, defense, counterclaim or right to recession with
respect to its obligations under Section 7.02 hereof.
(v) There is no judgment, decree or order of any court or governmental
or administrative agency or instrumentality which has been issued against
GECC, which affects materially and adversely the ability of GECC to perform
the GECC Obligations or the business or condition of GECC. There is no
claim, action, suit or proceeding or investigation, pending or, to the best
of GECC's knowledge, threatened affecting GECC, or before or by any
federal, state, municipal or other governmental department, commission,
board, bureau or agency, which either in any one instance or in the
aggregate, would draw into question the validity of Section 7.02 or 7.06
hereof or of any action taken or to be taken in connection with the
obligations of GECC contemplated in this Section 7.06, or which would be
likely to impair materially the ability of GECC to perform under the terms
of this Section 7.06.
(vi) GECC is a corporation, duly organized and in good standing under
the laws of the State of New York.
(vii) GECC has the full power and authority to enter into and
consummate all transactions contemplated to be performed by it by this
Agreement,
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has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(viii) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of GECC, enforceable against GECC in accordance with
the terms hereof, subject to (A) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally, and (B) general principles of equity,
regardless of whether such enforcement is considered in a proceeding in
equity or at law.
(ix) All representations and warranties made by GECC herein shall
survive the execution of this Agreement.
(c) No failure to exercise, and no delay in exercising, on the part of the
Trustee, any right under Section 7.02 or Section 7.06 hereof shall operate as a
waiver thereof, nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right. The rights
of the Trustee hereunder shall be in addition to all other rights provided at
law, in equity, by statute (or regulation) or otherwise. No amendment,
modification, or waiver pursuant to this Agreement which in any way affects the
rights or obligations of GECC pursuant to Sections 7.02 and 7.06 shall be
effective unless expressly consented to in writing by GECC and GECAM. No
modification or waiver of any provision of Section 7.02 or Section 7.06 hereof,
nor consent to departure therefrom, shall be effective unless in writing and no
such consent or waiver shall extend beyond the particular case and purpose
involved. No notice or demand given in any case shall constitute a waiver of the
right to take other action in the same, similar or other instances without such
notice or demand.
(d) GECC may assign its rights and obligations under this Agreement to a
third-party so long as such assignment would not cause the qualification,
downgrading or withdrawal of the then current rating on any Class of
Certificates. Upon such assignment, GECC shall be forever released and
discharged of its obligations pursuant to Sections 7.02(b) and 7.06.
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ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Default occurs and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs. Any permissive right of the Trustee contained in this Agreement
shall not be construed as a duty.
(b) The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement (other than the Mortgage Files, the review of which
is specifically governed by the terms of Article II) to the extent specifically
set forth herein, shall examine them to determine whether they conform to the
requirements of this Agreement to the extent specifically set forth herein. If
any such instrument is found not to conform to the requirements of this
Agreement in a material manner, the Trustee shall take such action as it deems
appropriate to have the instrument corrected. The Trustee shall not be
responsible for the accuracy or content of any resolution, certificate,
statement, opinion, report, document, order or other instrument furnished by the
Depositor or the Master Servicer or the Special Servicer, and accepted by the
Trustee in good faith, pursuant to this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after the
curing of all such Events of Default which may have occurred, the duties
and obligations of the Trustee shall be determined solely by the express
provisions of this Agreement, the Trustee shall not be liable except for
the performance of such duties and obligations as are specifically set
forth in this Agreement, no implied covenants or obligations shall be read
into this Agreement against the Trustee and, in the absence of bad faith on
the part of the Trustee, the Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee and conforming
to the requirements of this Agreement;
(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers
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of the Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of Certificates entitled to at
least 25% of the Voting Rights relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Agreement; and
(iv) The protections, immunities and indemnities afforded to the
Trustee hereunder shall also be available to it in its capacity as Paying
Agent, Authenticating Agent, Certificate Registrar, REMIC Administrator and
Custodian.
SECTION 8.02. Certain Matters Affecting Trustee.
Except as otherwise provided in Section 8.01.
(i) the Trustee may rely upon and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate, certificate
of auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document
reasonably believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(ii) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it hereunder
in good faith and in accordance therewith;
(iii) the Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Agreement or to make any investigation of
matters arising hereunder or, except as provided in Section 10.01, to institute,
conduct or defend any litigation hereunder or in relation hereto at the request,
order or direction of any of the Certificateholders, pursuant to the provisions
of this Agreement, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby; the Trustee shall not be
required to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it; provided, however, that nothing
contained herein shall, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default which has not been cured, to exercise such of
the rights and powers vested in it by this Agreement, and to use the same degree
of care and skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs;
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(iv) the Trustee shall not be personally liable for any action reasonably
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Agreement;
(v) prior to the occurrence of an Event of Default hereunder and after the
curing of all Events of Default which may have occurred, the Trustee shall not
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless
requested in writing to do so by Holders of Certificates entitled to at least
25% of the Voting Rights; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded to it by
the terms of this Agreement, the Trustee may require reasonable indemnity
against such expense or liability as a condition to taking any such action;
(vi) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys; provided, however, that the Trustee shall remain responsible for all
acts and omissions of such agents or attorneys within the scope of their
employment to the same extent as it is responsible for its own actions and
omissions hereunder; and
(vii) the Trustee shall not be responsible for any act or omission of the
Master Servicer or the Special Servicer (unless the Trustee is acting as Master
Servicer or the Special Servicer) or the Depositor.
(viii) Neither the Trustee nor the Certificate Registrar shall have any
obligation or duty to monitor, determine or inquire as to compliance with any
restriction on transfer imposed under Article V under this Agreement or under
applicable law with respect to any transfer of any Certificate or any interest
therein, other than to require delivery of the certification(s) and/or Opinions
of Counsel described in said Article applicable with respect to changes in
registration of record ownership of Certificates in the Certificate Register and
to examine the same to determine substantial compliance with the express
requirements of this Agreement. The Trustee and Certificate Registrar shall have
no liability for transfers, including transfers made through the book-entry
facilities of the Depository or between or among Depository Participants or
beneficial owners of the Certificates, made in violation of applicable
restrictions except for its failure to perform its express duties in connection
with changes in registration of record ownership in the Certificate Register.
SECTION 8.03. Trustee and Fiscal Agent Not Liable for Validity or
Sufficiency of Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates, other than the
statements attributed to the Trustee in Article II and the signature of the
Certificate Registrar and the Authenticating Agent set forth on each outstanding
Certificate, shall be taken as the statements
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of the Depositor or the Master Servicer or the Special Servicer, as the case may
be, and the Trustee and the Fiscal Agent assume no responsibility for their
correctness. The Trustee and the Fiscal Agent make no representations as to the
validity or sufficiency of this Agreement or of any Certificate (other than as
to the signature of the Trustee set forth thereon) or of any Mortgage Loan or
related document. The Trustee and the Fiscal Agent shall not be accountable for
the use or application by the Depositor of any of the Certificates issued to it
or of the proceeds of such Certificates, or for the use or application of any
funds paid to the Depositor in respect of the assignment of the Mortgage Loans
to the Trust Fund, or any funds deposited in or withdrawn from the Certificate
Account or any other account by or on behalf of the Depositor, the Master
Servicer or the Special Servicer. The Trustee and the Fiscal Agent shall not be
responsible for the accuracy or content of any resolution, certificate,
statement, opinion, report, document, order or other instrument furnished by the
Depositor, the Master Servicer or the Special Servicer, and accepted by the
Trustee in good faith, pursuant to this Agreement.
SECTION 8.04. Trustee May Own Certificates.
The Trustee, the Fiscal Agent or any agent of the Trustee and the
Fiscal Agent, in its individual or any other capacity, may become the owner or
pledgee of Certificates with the same rights it would have if it were not the
Trustee, the Fiscal Agent or such agent.
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of Trustee.
(a) On each Distribution Date, the Trustee shall withdraw from the general
funds on deposit in the Distribution Account, prior to any distributions to be
made therefrom on such date, and pay to itself all earned but unpaid Trustee's
Fees, as compensation for all services rendered by the Trustee in the execution
of the trusts hereby created and in the exercise and performance of any of the
powers and duties of the Trustee hereunder. The Trustee's Fee shall accrue from
time to time at a rate equal to one-twelfth of the product of (a) the Trustee
Fee Rate and (b) the aggregate Certificate Balance of the Certificates. The
Trustee's Fees (which shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust) shall constitute the
Trustee's sole compensation for such services to be rendered by it.
(b) The Trustee and any director, officer, employee, agent or "control"
person within the meaning of the Securities Act of 1933 of the Trustee shall be
entitled to be indemnified for and held harmless by the Trust Fund against any
loss, liability or reasonable "out-of-pocket" expense (including, without
limitation, costs and expenses of litigation, and of investigation, counsel
fees, damages, judgments and amounts paid in settlement) arising out of, or
incurred in connection with this Agreement or the Certificates ("Trustee
Liability"); provided that neither the Trustee nor any of the other above
specified Persons shall be entitled to indemnification pursuant to this Section
8.05(b) for (1) any liability specifically required to be borne thereby pursuant
to the terms hereof, or (2) any loss, liability or expense incurred by reason of
willful misfeasance, bad faith or negligence in the performance of the Trustee's
obligations and duties hereunder, or as may arise from a breach of any
representation, warranty or covenant of the Trustee made herein. The provisions
of this Section 8.05(b) and
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of Section 8.05(c) shall survive any resignation or removal of the Trustee and
appointment of a successor trustee.
(c) If the Trustee Liability arises from the issuance or sale of the
Certificates and the indemnification provided for in Section 8.05(b) is invalid
or unenforceable, then the Trust Fund shall contribute to the amount paid or
payable by the Trustee as a result of such Trustee Liability in such proportion
as is appropriate to reflect the relative fault of any other parties on the one
hand and the Trustee on the other in connection with the actions or omissions
which resulted in such Trustee Liability, as well as any other relevant
equitable considerations.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be an association or a corporation
organized and doing business under the laws of the United States of America or
any State thereof or the District of Columbia, authorized under such laws to
exercise trust powers, having a combined capital and surplus of at least
$100,000,000 and subject to supervision or examination by federal or state
banking authority. If such association or corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such association or corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. The Fiscal Agent shall at all times
maintain a long-term unsecured debt rating of at least "AA" by each Rating
Agency or such other rating that shall not result in the qualification,
downgrading or withdrawal of the rating or ratings assigned to one or more
Classes of the Certificates by any Rating Agency. In case at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section, the Trustee shall resign immediately in the manner and with the effect
specified in Section 8.07; provided that if the Trustee shall cease to be so
eligible because its combined capital and surplus is no longer at least
$100,000,000 or its long-term unsecured debt rating no longer conforms to the
requirements of the immediately preceding sentence, and if the Trustee proposes
to the other parties hereto to enter into an agreement with (and reasonably
acceptable to) each of them, and if in light of such agreement the Trustee's
continuing to act in such capacity would not (as evidenced in writing by each
Rating Agency) cause any Rating Agency to qualify, downgrade or withdraw any
rating assigned thereby to any Class of Certificates, then upon the execution
and delivery of such agreement the Trustee shall not be required to resign, and
may continue in such capacity, for so long as none of the ratings assigned by
the Rating Agencies to the Certificates is adversely affected thereby. The
corporation or association serving as Trustee may have normal banking and trust
relationships with the Depositor, the Master Servicer, the Special Servicer and
their respective Affiliates.
SECTION 8.07. Resignation and Removal of Trustee.
(a) The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Depositor, the Master
Servicer, the Special Servicer and to all Certificateholders. Upon such notice
of resignation, the Fiscal
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Agent shall also be deemed to have resigned. Upon receiving such notice of
resignation, the Master Servicer shall promptly appoint a successor trustee
acceptable to the Depositor by written instrument, in duplicate, which
instrument shall be delivered to the resigning Trustee and to the successor
trustee. A copy of such instrument shall be delivered to the Depositor, the
Special Servicer and the Certificateholders by the Master Servicer. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Depositor or the Master Servicer, or if at any time the
Trustee shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, or if the Trustee shall fail, if the Trustee is the Paying Agent
(other than by reason of the failure of either the Master Servicer or the
Special Servicer to timely perform its obligations hereunder or as a result of
other circumstances beyond the Trustee's reasonable control), to timely deliver
any current or revised Distribution Date Statement, Collection Report or Updated
Mortgage Loan Schedule required by Section 4.02 and such failure shall continue
unremedied for a period of five days, or if the Paying Agent (if different from
the Trustee) fails to make distributions required pursuant to Sections 3.05(b)
or 4.01, then the Depositor may remove the Trustee and Fiscal Agent and appoint
a successor trustee and successor fiscal agent, if necessary, acceptable to the
Master Servicer by written instrument, in duplicate, which instrument shall be
delivered to the Trustee so removed and to the successor trustee. A copy of such
instrument shall be delivered to the Master Servicer, the Special Servicer and
the Certificateholders by the Depositor. Any resignation or termination of the
Trustee shall result in the simultaneous resignation or termination, as
applicable, of the Fiscal Agent.
(c) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and Fiscal Agent and appoint a
successor trustee and successor fiscal agent, if necessary, by written
instrument or instruments, in triplicate, signed by such Holders or their
attorneys-in-fact duly authorized, one complete set of which instruments shall
be delivered to the Master Servicer, one complete set to the Trustee so removed,
one complete set to the Fiscal Agent so removed, one complete set to the
successor Trustee so appointed and one complete set to the successor Fiscal
Agent so appointed. A copy of such instrument shall be delivered to the
Depositor, the Special Servicer and the remaining Certificateholders by the
successor so appointed. In the event that the Trustee or Fiscal Agent is
terminated or removed pursuant to this Section 8.07, all of its rights and
obligations under this Agreement and in and to the Mortgage Loans shall be
terminated, other than any rights or obligations that accrued prior to the date
of such termination or removal (including the right to receive all fees,
expenses and other amounts (including, without limitation, P&I Advances and
accrued interest thereon) accrued or owing to it under this Agreement, with
respect to periods prior to the date of such termination or removal and no
termination without cause shall be effective until the payment of such amounts
to the Trustee and the Fiscal Agent).
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(d) Any resignation or removal of the Trustee and Fiscal Agent and
appointment of a successor trustee and successor fiscal agent pursuant to any of
the provisions of this Section 8.07 shall not become effective until acceptance
of appointment by the successor trustee and, if necessary, successor fiscal
agent as provided in Section 8.08.
SECTION 8.08. Successor Trustee.
(a) Any successor trustee and successor fiscal agent appointed as provided
in Section 8.07 shall execute, acknowledge and deliver to the Depositor, the
Master Servicer, the Special Servicer and to its predecessor trustee and
predecessor fiscal agent, as the case may be, an instrument accepting such
appointment hereunder and, with respect to any successor trustee, acknowledging
that such successor trustee shall be subject to that certain letter agreement by
and between the initial Trustee and Continental Wingate Associates, Inc., dated
as of June 26, 1997, and thereupon the resignation or removal of the predecessor
trustee and predecessor fiscal agent shall become effective and such successor
trustee and successor fiscal agent, without any further act, deed or conveyance,
shall become fully vested with all the rights, powers, duties and obligations of
its predecessor hereunder, with the like effect as if originally named as
trustee herein. The predecessor trustee shall deliver to the successor trustee
all Mortgage Files and related documents and statements held by it hereunder
(other than any Mortgage Files at the time held on its behalf by a Custodian,
which Custodian shall become the agent of the successor trustee), and the
Depositor, the Master Servicer, the Special Servicer and the predecessor trustee
shall execute and deliver such instruments and do such other things as may
reasonably be required to more fully and certainly vest and confirm in the
successor trustee all such rights, powers, duties and obligations, and to enable
the successor trustee to perform its obligations hereunder.
(b) No successor trustee shall accept appointment as provided in this
Section 8.08, unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 8.06.
(c) Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, such successor trustee shall mail notice of the succession of
such trustee hereunder to the Depositor and the Certificateholders.
SECTION 8.09. Merger or Consolidation of Trustee.
Any entity into which the Trustee may be merged or converted or with which
it may be consolidated or any entity resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any entity succeeding to
the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided such entity shall be eligible under the provisions
of Section 8.06, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
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SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located, the
Master Servicer and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this Section
8.10, such powers, duties, obligations, rights and trusts as the Master Servicer
and the Trustee may consider necessary or desirable. If the Master Servicer
shall not have joined in such appointment within 15 days after the receipt by it
of a request to do so, or in case an Event of Default in respect of the Master
Servicer shall have occurred and be continuing, the Trustee alone shall have the
power to make such appointment. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 8.06 hereunder and no notice to Holders of Certificates of the
appointment of co-trustee(s) or separate trustee(s) shall be required under
Section 8.08 hereof.
(b) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Master Servicer or the Special Servicer hereunder), the
Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to the Trust Fund or any portion thereof in any such jurisdiction)
shall be exercised and performed by such separate trustee or co-trustee at the
direction of the Trustee.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
(d) Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign
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or be removed, all of its estates, properties, rights, remedies and trusts shall
vest in and be exercised by the Trustee, to the extent permitted by law, without
the appointment of a new or successor trustee.
(e) The appointment of a co-trustee or separate trustee under this Section
8.10 shall not relieve the Trustee of its duties and responsibilities hereunder.
SECTION 8.11. Appointment of Custodians.
The Trustee may appoint at the Trustee's expense one or more Custodians to
hold all or a portion of the Mortgage Files as agent for the Trustee. Each
Custodian shall be a depository institution supervised and regulated by a
federal or state banking authority, shall have combined capital and surplus of
at least $10,000,000, shall be qualified to do business in the jurisdiction in
which it holds any Mortgage File and shall not be the Depositor or any Affiliate
of the Depositor. Neither the Master Servicer nor the Special Servicer shall
have any duty to verify that any such Custodian is qualified to act as such in
accordance with the preceding sentence. The Trustee may enter into agreements to
appoint a Custodian which is not the Trustee, provided that, such agreement: (i)
is consistent with this Agreement in all material respects and requires the
Custodian to comply with this Agreement in all material respects and requires
the Custodian to comply with all of the applicable conditions of this Agreement;
(ii) provides that if the Trustee shall for any reason no longer act in the
capacity of Trustee hereunder (including, without limitation, by reason of an
Event of Default), the successor Trustee or its designee may thereupon assume
all of the rights and, except to the extent they arose prior to the date of
assumption, obligations of the Custodian under such agreement or alternatively,
may terminate such agreement without cause and without payment of any penalty or
termination fee; and (iii) does not permit the Custodian any rights of
indemnification that may be satisfied out of assets of the Trust Fund. The
appointment of one or more Custodians shall not relieve the Trustee from any of
its obligations hereunder, and the Trustee shall remain responsible for all acts
and omissions of any Custodian. The initial Custodian shall be the Trustee.
Notwithstanding anything herein to the contrary, if the Trustee is no longer the
Custodian, any provision or requirement herein requiring notice or any
information or documentation to be provided to the Custodian shall be construed
to require that such notice, information or documents also be provided to the
Trustee. Any Custodian hereunder shall at all times maintain a fidelity bond and
errors and omissions policy in amounts customary for custodians performing
duties similar to those set forth in this Agreement.
SECTION 8.12. Appointment of Authenticating Agents.
(a) The Trustee may appoint one or more Authenticating Agents, which shall
be authorized to act on behalf of the Trustee in authenticating Certificates.
Each Authenticating Agent must be organized and doing business under the laws of
the United States of America or of any State, authorized under such laws to do a
trust business, have a combined capital and surplus of at least $15,000,000, and
be subject to supervision or examination by federal or state authorities. Each
Authenticating Agent shall be subject to the same obligations, standard of care,
protection and indemnities as would be imposed on, or
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would protect, the Trustee hereunder. The initial Authenticating Agent shall be
the Trustee. Notwithstanding anything herein to the contrary, if the Trustee is
no longer the Authenticating Agent, any provision or requirement herein
requiring notice or any information or documentation to be provided to the
Authenticating Agent shall be construed to require that such notice, information
or documentation also be provided to the Trustee.
(b) Any Person into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion, or consolidation to which any Authenticating Agent shall be
a party, or any Person succeeding to the corporate agency business of any
Authenticating Agent, shall continue to be the Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at least 30
days' advance written notice of resignation to the Trustee, the Certificate
Registrar, the Master Servicer, the Special Servicer and the Depositor. The
Trustee may at any time terminate the agency of any Authenticating Agent by
giving written notice of termination to such Authenticating Agent, the Master
Servicer, the Certificate Registrar and the Depositor. Upon receiving a notice
of resignation or upon such a termination, or in case at any time any
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 8.12, the Trustee may appoint a successor
Authenticating Agent, in which case the Trustee shall given written notice of
such appointment to the Master Servicer, the Certificate Registrar and the
Depositor and shall mail notice of such appointment to all Holders of
Certificates; provided, however, that no successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 8.12. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally named as
Authenticating Agent. No Authenticating Agent shall have responsibility or
liability for any action taken by it as such at the direction of the Trustee.
SECTION 8.13. Appointment of Paying Agent.
The Trustee may appoint a Paying Agent for the purpose of making
distributions to Certificateholders hereunder. The Trustee shall cause such
Paying Agent to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee that such Paying Agent will hold all
sums held by it for the payment to Certificateholders in an Eligible Account in
trust for the benefit of the Certificateholders entitled thereto until such sums
shall be paid to the Certificateholders. All funds remitted by the Trustee or
the Master Servicer to any such Paying Agent for the purpose of making
distributions shall be paid to Certificateholders on each Distribution Date and
any amounts not so paid shall be returned on such Distribution Date to the
Trustee or the Master Servicer, as applicable. If the Paying Agent is not the
Trustee or the Master Servicer, the Trustee or the Master Servicer shall remit
to the Paying Agent on the Business Day prior to each Distribution Date, by wire
transfer in immediately available funds, the funds to be distributed on such
Distribution Date. Any Paying Agent shall be either a bank or trust company or
otherwise
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authorized under law to exercise corporate trust powers and shall have a rating
of at least "A" (or its equivalent) by each of Fitch, Standard & Poor's and
Moody's, or such lower rating as will not result in qualification, downgrading
or withdrawal of the ratings then assigned to the Certificates, as evidenced in
writing by the Rating Agencies. The Trustee may enter into agreements to appoint
a Paying Agent which is not the Trustee, provided that, such agreement: (i) is
consistent with this Agreement in all material respects and requires the Paying
Agent to comply with this Agreement in all material respects and requires the
Paying Agent to comply with all of the applicable conditions of this Agreement;
(ii) provides that if the Trustee shall for any reason no longer act in the
capacity of Trustee hereunder (including, without limitation, by reason of an
Event of Default), the successor Trustee or its designee may thereupon assume
all of the rights and, except to the extent they arose prior to the date of
assumption, obligations of the Paying Agent under such agreement or
alternatively, may terminate such agreement without cause and without payment of
any penalty or termination fee; and (iii) does not permit the Paying Agent any
rights of indemnification that may be satisfied out of assets of the Trust Fund.
The appointment of any Paying Agent shall not relieve the Trustee from any of
its obligations hereunder, and the Trustee shall remain responsible for all acts
and omissions of any Paying Agent. The initial Paying Agent shall be the
Trustee. Notwithstanding anything herein to the contrary, if the Trustee is no
longer the Authenticating Agent, any provision or requirement herein requiring
notice or any information to be provided to the Authenticating Agent shall be
construed to require that such notice, information or documentation also be
provided to the Trustee.
SECTION 8.14. Appointment of REMIC Administrators.
(a) The Trustee may appoint one or more REMIC Administrators, which shall
be authorized to act on behalf of the Trustee in performing the functions set
forth in Sections 3.17 and 10.01 herein. Each REMIC Administrator must be
acceptable to the Trustee and must be organized and doing business under the
laws of the United States of America or of any State and be subject to
supervision or examination by federal or state authorities.
(b) Any Person into which any REMIC Administrator may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion, or consolidation to which any REMIC Administrator shall be a
party, or any Person succeeding to the corporate agency business of any REMIC
Administrator, shall continue to be the REMIC Administrator without the
execution or filing of any paper or any further act on the part of the Trustee
or the REMIC Administrator.
(c) Any REMIC Administrator may at any time resign by giving at least 30
days' advance written notice of resignation to the Trustee, the Certificate
Registrar, the Paying Agent, the Master Servicer, the Special Servicer and the
Depositor. The Trustee may at any time terminate the agency of any REMIC
Administrator by giving written notice of termination to such REMIC
Administrator , the Master Servicer, the Certificate Registrar and the
Depositor. Upon receiving a notice of resignation or upon such a termination, or
in case at any time any REMIC Administrator shall cease to be eligible in
accordance with
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the provisions of this Section 8.14, the Trustee may appoint a successor REMIC
Administrator, in which case the Trustee shall given written notice of such
appointment to the Master Servicer and the Depositor and shall mail notice of
such appointment to all Holders of Certificates; provided, however, that no
successor REMIC Administrator shall be appointed unless eligible under the
provisions of this Section 8.14. Any successor REMIC Administrator upon
acceptance of its appointment hereunder shall become vested with all the rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as REMIC Administrator. No REMIC Administrator
shall have responsibility or liability for any action taken by it as such at the
direction of the Trustee.
SECTION 8.15. Access to Certain Information.
The Trustee shall afford to the Master Servicer, the Special Servicer and
the Depositor, any Certificateholder and to the OTS, the FDIC and any other
banking or insurance regulatory authority that may exercise authority over any
Certificateholder, access to any documentation regarding the Mortgage Loans
within its control that may be required to be provided by this Agreement or by
applicable law. Such access shall be afforded without charge but only upon
reasonable prior written request and during normal business hours at the offices
of the Trustee designated by it.
SECTION 8.16. Representations and Warranties of Trustee.
The Trustee hereby represents and warrants to the Master Servicer, the
Special Servicer, the Fiscal Agent and the Depositor and for the benefit of the
Certificateholders, as of the Closing Date, that:
(i) The Trustee is a national banking association duly organized, validly
existing and in good standing under the laws of the United States of America.
(ii) The execution and delivery of this Agreement by the Trustee, and the
performance and compliance with the terms of this Agreement by the Trustee, will
not violate the Trustee's articles of incorporation and by-laws or constitute a
default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in the breach of, any material agreement
or other instrument to which it is a party or which is applicable to it or any
of its assets.
(iii) Except to the extent that the laws of certain jurisdictions in which
any part of the Trust Fund may be located require that a co-trustee or separate
trustee be appointed to act with respect to such property as contemplated by
Section 8.10, the Trustee has the full power and authority to carry on its
business as now being conducted and to enter into and consummate all
transactions contemplated by this Agreement, has duly authorized the execution,
delivery and performance of this Agreement, and has duly executed and delivered
this Agreement.
(iv) This Agreement, assuming due authorization, execution and delivery by
the other parties hereto, constitutes a valid and binding obligation of the
Trustee, enforceable
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against the Trustee in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights generally, and (B) general
principles of equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) The Trustee is not in violation of, and its execution and delivery of
this Agreement and its performance and compliance with the terms of this
Agreement, including, but not limited to, its responsibility to make P&I
Advances if the Master Servicer fails to make a P&I Advance pursuant to Section
7.02, will not constitute a violation of, any law, any order or decree of any
court or arbiter, or any order, regulation or demand of any federal, state or
local governmental or regulatory authority, which violation, in the Trustee's
good faith and reasonable judgment, is likely to affect materially and adversely
affect the ability of the Trustee to perform its obligations under this
Agreement.
(vi) No litigation is pending or, to the best of the Trustee's knowledge,
threatened against the Trustee that, if determined adversely to the Trustee,
would prohibit the Trustee from entering into this Agreement or, in the
Trustee's good faith and reasonable judgment, is likely to materially and
adversely affect the ability of the Trustee to perform its obligations under
this Agreement.
(vii) Any consent, approval, authorization or order of any court or
governmental agency or body required for the execution, delivery and performance
by the Trustee of or compliance by the Trustee with this Agreement or the
consummation of the transactions contemplated by this Agreement has been
obtained and is effective.
SECTION 8.17. Reports to the Securities and Exchange Commission; Available
Information.
The Depositor shall prepare for filing, and the Trustee shall execute, on
behalf of the Trust Fund, and file with the Securities and Exchange Commission,
any and all reports, statements and information respecting the Trust Fund and/or
the Certificates required to be filed on behalf of the Trust Fund under the
Exchange Act. The Depositor shall pay the Trustee a fee determined by the
Depositor and the Trustee for each filing that the Depositor directs the Trustee
to make through the EDGAR System, as compensation to the Trustee in addition to
the Trustee Fee hereunder. Upon such filing with the Securities and Exchange
Commission, the Trustee shall promptly deliver to the Depositor, the Master
Servicer and the Controlling Class Representative a copy of any such executed
report, statement or information. The Depositor shall promptly file, and
exercise its reasonable best efforts to obtain a favorable response to,
no-action requests to, or requests for other appropriate exemptive relief from,
the Securities and Exchange Commission regarding the usual and customary
exemption from certain reporting requirements granted to issuers of securities
similar to the Certificates. The Depositor agrees to indemnify and hold harmless
the Trustee with respect to any liability, cost or expenses, including
reasonable attorneys' fees, arising from the Trustee's execution of such
reports, statements and information that contain errors or omissions or is
otherwise misleading, provided, however, that if the indemnification provided
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for herein is invalid or unenforceable, then the Depositor shall contribute to
the amount paid by the Trustee as a result of such liability in such amount s is
necessary to limit the Trustee's responsibility for any such payment to any
amount resulting from its own fault.
SECTION 8.18. Fiscal Agent Appointed; Concerning the Fiscal Agent.
(a) The Trustee hereby appoints ABN AMRO Bank N.V. as the initial Fiscal
Agent hereunder for the purposes of exercising and performing the obligations
and duties imposed upon the Fiscal Agent by Section 4.03.
(b) The Fiscal Agent undertakes to perform such duties and only such duties
as are specifically set forth in Section 4.03.
(c) No provision of this Agreement shall be construed to relieve the Fiscal
Agent from liability for its own negligent failure to act or its own willful
misfeasance or for a breach of a representation or warranty contained herein;
provided, however, that (i) the duties and obligations of the Fiscal Agent shall
be determined solely by the express provisions of Section 4.03, the Fiscal Agent
shall not be liable except for the performance of such duties and obligations,
no implied covenants or obligations shall be read into this Agreement against
the Fiscal Agent and, in the absence of bad faith on the part of the Fiscal
Agent, the Fiscal Agent may conclusively rely, as to the truth and resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Fiscal Agent by the Depositor, the Master Servicer,
the Special Servicer or the Trustee and which on their face do not contradict
the requirements of this Agreement, and (ii) the provisions of clause (ii) of
Section 8.01(c) shall apply to the Fiscal Agent.
(d) Except as otherwise provided in Section 8.18(c), the Fiscal Agent also
shall have the benefit of provisions of clauses (i), (ii), (iii) (other than the
proviso thereto), (iv), (v) (other than the proviso thereto), (vi) and (vii) of
Section 8.02.
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ARTICLE IX
TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All Mortgage
Loans.
Subject to Section 9.02, the Trust Fund and the respective obligations and
responsibilities under this Agreement of the Depositor, the Master Servicer, the
Special Servicer, the Fiscal Agent and the Trustee (other than the obligations
of the Paying Agent on behalf of the Trustee to provide for and make payments to
Certificateholders as hereafter set forth) shall terminate upon payment (or
provision for payment) (i) to the Certificateholders of all amounts held by or
on behalf of the Trustee and required hereunder to be so paid on the
Distribution Date following the earlier to occur of (A) the purchase by the
Depositor or the Master Servicer of all Mortgage Loans and each REO Property
remaining in REMIC I at a price equal to (1) the aggregate Purchase Price of all
the Mortgage Loans included in REMIC I, plus (2) the appraised value of each REO
Property, if any, included in REMIC I, such appraisal to be conducted by an
Independent Appraiser selected by the Master Servicer and approved by the
Trustee, minus (3) if the purchaser is the Master Servicer, the aggregate amount
of unreimbursed Advances made by the Master Servicer, together with any interest
accrued and payable to the Master Servicer in respect of unreimbursed Advances
in accordance with Sections 3.03(d) and 4.03(d) and any unpaid Master Servicing
Fees remaining outstanding (which items shall be deemed to have been paid or
reimbursed to the Master Servicer in connection with such purchase), and (B) the
final payment or other liquidation (or any advance with respect thereto) of the
last Mortgage Loan or REO Property remaining in REMIC I, and (ii) to the
Trustee, the Fiscal Agent, the Master Servicer, the Special Servicer and the
officers, directors, employees and agents of each of them of all amounts which
may have become due and owing to any of them hereunder; provided, however, that
in no event shall the trust created hereby continue beyond the expiration of 21
years from the death of the last survivor of the descendants of Joseph P.
Kennedy, the late ambassador of the United States to the Court of St. James,
living on the date hereof.
The Depositor or the Master Servicer may at its option elect to purchase
all of the Mortgage Loans and each REO Property remaining in REMIC I as
contemplated by clause (i) of the preceding paragraph by giving written notice
to the other parties hereto no later than 60 days prior to the anticipated date
of purchase; provided, however, that (i) the aggregate Stated Principal Balance
of the Mortgage Pool at the time of such election is less than 1% of the
aggregate Cut-off Date Balance of the Mortgage Pool set forth in the Preliminary
Statement, and (ii) the Master Servicer shall not have the right to effect such
a purchase if, within 30 days following the Master Servicer's delivery of a
notice of election pursuant to this paragraph, the Depositor shall give notice
of its election to purchase all of the Mortgage Loans and each REO Property
remaining in REMIC I and shall thereafter effect such purchase in accordance
with the terms hereof. If the Trust Fund is to be terminated in connection with
the Master Servicer's or the Depositor's purchase of all of the Mortgage Loans
and each REO Property remaining in REMIC I, the Master Servicer or the
Depositor, as applicable, shall
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deliver to the Paying Agent for deposit in the Distribution Account not later
than the P&I Advance Date relating to the Distribution Date on which the final
distribution on the Certificates is to occur an amount in immediately available
funds equal to the above-described purchase price. In addition, the Master
Servicer shall transfer to the Distribution Account all amounts required to be
transferred thereto on such P&I Advance Date from the Certificate Account
pursuant to the first paragraph of Section 3.04(b), together with any other
amounts on deposit in the Certificate Account that would otherwise be held for
future distribution. Upon confirmation that such final deposit has been made,
the Trustee shall release or cause to be released to the Master Servicer or the
Depositor, as applicable, the Mortgage Files for the remaining Mortgage Loans
and shall execute all assignments, endorsements and other instruments furnished
to it by the Master Servicer or the Depositor, as applicable, as shall be
necessary to effectuate transfer of the Mortgage Loans and REO Properties to the
Master Servicer (or its designee) or the Depositor (or its designees), as
applicable. Any transfer of Mortgage Loans to the Depositor pursuant to this
paragraph shall be on a servicing-released basis.
Notice of any termination shall be given promptly by the Trustee by letter
to Certificateholders mailed (a) if such notice is given in connection with the
Master Servicer's or Depositor's purchase of the Mortgage Loans and each REO
Property remaining in REMIC I, not earlier than the 15th day and not later than
the 25th day of the month next preceding the month of the final distribution on
the Certificates or (b) otherwise during the month of such final distribution on
or before the Determination Date in such month to the extent a Responsible
Officer of the Trustee has knowledge of such termination, but in any event not
less than five days prior to such final Distribution Date, in each case
specifying (i) the Distribution Date upon which the Trust Fund will terminate
and final payment of the Certificates will be made, (ii) the amount of any such
final payment and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made only upon presentation
and surrender of the Certificates at the offices of the Certificate Registrar or
such other location therein designated. The Trustee shall give such notice to
the Master Servicer, the Special Servicer and the Depositor at the time such
notice is given to Certificateholders.
Upon presentation and surrender of the Certificates by the
Certificateholders on the final Distribution Date, the Paying Agent shall
distribute to each Certificateholder so presenting and surrendering its
Certificates such Certificateholder's Percentage Interest of that portion of the
amounts then on deposit in the Distribution Account that are allocable to
payments on the Class of Certificates so presented and surrendered. Amounts on
deposit in the Distribution Account as of the final Distribution Date, exclusive
of any portion thereof that would be payable to any Person in accordance with
clauses (ii) through (viii) of Section 3.05(b), and further exclusive of any
portion thereof that represents Prepayment Premiums and Yield Maintenance
Charges, shall be allocated in the following order of priority, in each case to
the extent of remaining available funds:
(i) to distributions of interest to the Holders of the Senior
Certificates, in an amount equal to, and pro rata in accordance with, all
Distributable Certificate Interest
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in respect of each Class of Senior Certificates for such Distribution Date
and, to the extent not previously paid, for all prior Distribution Dates;
(ii) to distributions of principal to the Holders of the Class A-1
Certificates, in an amount equal to the Class Principal Balance of the
Class A-1 Certificates outstanding immediately prior to such Distribution
Date;
(iii) after the Class Principal Balance of the Class A-1 Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class A-2 Certificates, in an amount equal to the Class Principal
Balance of the Class A-2 Certificates outstanding immediately prior to such
Distribution Date;
(iv) after the Class Principal Balance of the Class A-1 Certificates
and Class A-2 Certificates have been reduced to zero, to distributions of
principal to the Holders of the Class A-3 Certificates, in an amount equal
to the Class Principal Balance of the Class A-3 Certificates outstanding
immediately prior to such Distribution Date;
(v) to distributions to the Holders of the Class A-1, Class A-2 and
Class A-3 Certificates, in an amount equal to, and pro rata in accordance
with all Realized Losses and Additional Trust Fund Expenses previously
allocated to such Classes of Certificates and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any, previously
allocated to such Classes of Certificates and not previously reimbursed;
(vi) to distributions of interest to the Holders of the Class B
Certificates in an amount equal to all Distributable Certificate Interest
in respect of such Class of Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(vii) after the Class Principal Balance of the Class A-1 Certificates,
the Class A-2 Certificates and the Class A-3 Certificates have been reduced
to zero, to distributions of principal to the Holders of the Class B
Certificates, in an amount equal to the Class Principal Balance of the
Class B Certificates outstanding immediately prior to such Distribution
Date;
(viii) to distributions to the Holders of the Class B Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class B
Certificates and not previously reimbursed;
(ix) to distributions of interest to the Holders of the Class C
Certificates in an amount equal to all Distributable Certificate Interest
in respect of such Class of Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
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(x) after the Class Principal Balance of the Class B Certificates has
been reduced to zero, to distributions of principal to the Holders of the
Class C Certificates, in an amount equal to the Class Principal Balance of
the Class C Certificates outstanding immediately prior to such Distribution
Date;
(xi) to distributions to the Holders of the Class C Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class C
Certificates and not previously reimbursed;
(xii) to distributions of interest to the Holders of the Class D
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class D Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xiii) after the Class Principal Balance of the Class C Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class D Certificates, in an amount equal to the Class Principal Balance
of the Class D Certificates outstanding immediately prior to such
Distribution Date;
(xiv) to distributions to the Holders of the Class D Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class D
Certificates and not previously reimbursed;
(xv) to distributions of interest to the Holders of the Class E
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class E Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xvi) after the Class Principal Balance of the Class D Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class E Certificates, in an amount equal to the Class Principal Balance
of the Class E Certificates outstanding immediately prior to such
Distribution Date;
(xvii) to distributions to the Holders of the Class E Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class E
Certificates and not previously reimbursed;
(xviii) to distributions of interest to the Holders of the Class F
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class F Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
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(xix) after the Class Principal Balance of the Class E Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class F Certificates, in an amount equal to the Class Principal Balance
of the Class F Certificates outstanding immediately prior to such
Distribution Date;
(xx) to distributions to the Holders of the Class F Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class F
Certificates and not previously reimbursed;
(xxi) to distributions of interest to the Holders of the Class G
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class G Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxii) after the Class Principal Balance of the Class F Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class G Certificates, in an amount equal to the Class Principal Balance
of the Class G Certificates outstanding immediately prior to such
Distribution Date;
(xxiii) to distributions to the Holders of the Class G Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class G
Certificates and not previously reimbursed;
(xxiv) to distributions of interest to the Holders of the Class H
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class H Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxv) after the Class Principal Balance of the Class G Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class H Certificates, in an amount equal to the Class Principal Balance
of the Class H Certificates outstanding immediately prior to such
Distribution Date;
(xxvi) to distributions to the Holders of the Class H, in an amount
equal to, and in reimbursement of, all Realized Losses and Additional Trust
Fund Expenses, if any, previously allocated to the Class H Certificates and
not previously reimbursed;
(xxvii) to distributions of interest to the Holders of the Class J
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class J Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
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(xxviii) after the Class Principal Balance of the Class H Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class J Certificates, in an amount equal to the Class Principal Balance
of the Class J Certificates outstanding immediately prior to such
Distribution Date;
(xxix) to distributions to the Holders of the Class J, in an amount
equal to, and in reimbursement of, all Realized Losses and Additional Trust
Fund Expenses, if any, previously allocated to the Class J Certificates and
not previously reimbursed; and
(xxx) to distributions to the Holders of the Class R-III Certificates,
in an amount equal to the balance, if any, of the Available Distribution
Amount for such Distribution Date remaining after the distributions to be
made on such Distribution Date pursuant to clauses (i) through (xxix)
above.
Any Prepayment Premiums on deposit in the Certificate Account as of the
final Distribution Date shall be distributed among the Holders of the Class A-1,
Class A-2, Class A-3, Class B, Class C, Class D, Class E, Class F, Class G,
Class H, Class J and Class IO Certificates and any Additional Interest on
deposit in the Additional Interest Distribution Account as of the final
Distribution Date shall be distributed to Gemstone Acquisition Corporation or
its assignee in accordance with Section 4.01(b). Anything in this Section 9.01
to the contrary notwithstanding, Gemstone Acquisition Corporation or its
assignee shall receive that portion of the Additional Interest on deposit in the
Additional Interest Distribution Account, as its interest may appear. Any funds
not distributed to any Holder or Holders of Certificates of such Class on such
Distribution Date because of the failure of such Holder or Holders to tender
their Certificates shall, on such date, be set aside and held uninvested in
trust and credited to the account or accounts of the appropriate non-tendering
Holder or Holders. If any Certificates as to which notice has been given
pursuant to this Section 9.01 shall not have been surrendered for cancellation
within six months after the time specified in such notice, the Paying Agent
shall mail a second notice to the remaining non-tendering Certificateholders to
surrender their Certificates for cancellation in order to receive the final
distribution with respect thereto. If within one year after the second notice
all such Certificates shall not have been surrendered for cancellation, the
Paying Agent, directly or through an agent, shall take such reasonable steps to
contact the remaining non-tendering Certificateholders concerning the surrender
of their Certificates as it shall deem appropriate. The costs and expenses of
holding such funds in trust and of contacting such Certificateholders following
the first anniversary of the delivery of such second notice to the non-tendering
Certificateholders shall be paid out of such funds. No interest shall accrue or
be payable to any former Holder on any amount held in trust hereunder. If,
within nine months after the second notice, all of the Certificates shall not
have been surrendered for cancellation, the Class R-III Certificateholder shall
be entitled to all unclaimed funds and other assets which remain subject
thereto.
All actual distributions on the respective Classes of REMIC III
Certificates on the final Distribution Date in accordance with foregoing
provisions of this Section 9.01 shall
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be deemed to have first been distributed from REMIC I to REMIC II on the various
REMIC I Regular Interests in accordance with Section 4.01(j).
SECTION 9.02. Additional Termination Requirements.
(a) If the Depositor or the Master Servicer purchases all of the Mortgage
Loans and each REO Property remaining in REMIC I as provided in Section 9.01,
the Trust Fund (and, accordingly, REMIC I, REMIC II and REMIC III) shall be
terminated in accordance with the following additional requirements, unless the
Master Servicer or the Depositor, as applicable, obtains at its own expense and
delivers to the Trustee and, in the case of the Depositor, to the Trustee and
the Master Servicer, an Opinion of Counsel, addressed to the Trustee and the
Master Servicer, to the effect that the failure of the Trust Fund to comply with
the requirements of this Section 9.02 will not result in the imposition of taxes
on "prohibited transactions" of REMIC I, REMIC II and REMIC III as defined in
Section 860F of the Code or cause REMIC I, REMIC II and REMIC III to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) the Trustee shall specify the first day in the 90-day liquidation
period in a statement attached to the final Tax Return for each of REMIC I,
REMIC II and REMIC III pursuant to Treasury regulation Section 1.860F-1 and
shall satisfy all requirements of a qualified liquidation under Section
860F of the Code and any regulations thereunder as set forth in an Opinion
of Counsel obtained by the purchasing party at the expense of the Trust
Fund;
(ii) during such 90-day liquidation period and at or prior to the time
of making of the final payment on the Certificates, the Trustee shall sell
all of the assets of REMIC I to the Master Servicer or the Depositor, as
applicable, for cash; and
(iii) at the time of the making of the final payment on the
Certificates, the Paying Agent shall distribute or credit, or cause to be
distributed or credited, to the Certificateholders in accordance with
Section 9.01 all cash on hand (other than cash retained to meet claims),
and each of REMIC I, REMIC II and REMIC III shall terminate at that time.
(b) By their acceptance of Certificates, the Holders thereof hereby agree
to authorize the Trustee to specify the 90-day liquidation period for each of
REMIC I, REMIC II and REMIC III, which authorization shall be binding upon all
successor Certificateholders.
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ARTICLE X
ADDITIONAL REMIC PROVISIONS
SECTION 10.01. REMIC Administration.
(a) The REMIC Administrator shall elect to treat each of REMIC I, REMIC II
and REMIC III as a REMIC under the Code and, if necessary, under applicable
state law. Such election will be made on Form 1066 or other appropriate federal
or state Tax Returns for the taxable year ending on the last day of the calendar
year in which the Certificates are issued.
(b) The REMIC I Regular Interests, the REMIC II Regular Interests and the
Regular Certificates (including in the case of the Class IO Certificates, each
of its Components) are hereby designated as "regular interests" (within the
meaning of Section 860G(a)(1) of the Code) in REMIC I, REMIC II and REMIC III,
respectively. The Class R-I Certificates, the Class R-II Certificates and the
Class R-III Certificates are hereby designated as the single class of "residual
interests" (within the meaning of Section 860G(a)(2) of the Code) in REMIC I,
REMIC II and REMIC III, respectively. None of the Master Servicer, the Special
Servicer or the Trustee shall (to the extent within its control) permit the
creation of any other "interests" in REMIC I, REMIC II or REMIC III (within the
meaning of Treasury regulation Section 1.860D-1(b)(1)).
(c) The Closing Date is hereby designated as the "startup day" of REMIC I,
REMIC II and REMIC III within the meaning of Section 860G(a)(9) of the Code.
(d) The Plurality Residual Certificateholder as to the applicable taxable
year is hereby designated as the Tax Matters Person of each of REMIC I, REMIC II
and REMIC III, and shall act on behalf of the related REMIC in relation to any
tax matter or controversy and shall represent the related REMIC in any
administrative or judicial proceeding relating to an examination or audit by any
governmental taxing authority; provided that the REMIC Administrator is hereby
irrevocably appointed to act and shall act (in consultation with the Tax Matters
Person for each of REMIC I, REMIC II and REMIC III) as agent and
attorney-in-fact for the Tax Matters Person for each of REMIC I, REMIC II and
REMIC III in the performance of its duties as such.
(e) Solely for purposes of Treasury Regulation Sections
1.860G-1(a)(4)(iii), June 18, 2029, has been designated the "latest possible
maturity date" of each REMIC I Regular Interest, REMIC II Regular Interest and
each Class of Regular Certificates.
(f) The Trustee shall pay any and all ordinary tax-related expenses of any
of REMIC I, REMIC II OR REMIC III. Extraordinary expenses including, but not
limited to, any professional fees or expenses related to audits or any
administrative or judicial proceedings with respect to any of REMIC I, REMIC II
OR REMIC III that involve the
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Internal Revenue Service or state or local taxing authorities will be expenses
of the Trust Fund.
(g) Within 30 days after the Closing Date, the REMIC Administrator shall
prepare and file with the Internal Revenue Service Form 8811, "Information
Return for Real Estate Mortgage Investment Conduits (REMIC) and Issuers of
Collateralized Debt Obligations" for the Trust Fund. In addition, the REMIC
Administrator shall prepare, sign and file all of the other Tax Returns in
respect of REMIC I, REMIC II and REMIC III. The expenses of preparing and filing
such returns shall be borne by the REMIC Administrator without any right of
reimbursement therefor. The other parties hereto shall provide on a timely basis
to the REMIC Administrator or its designee such information with respect to each
of REMIC I, REMIC II and REMIC III as is in its possession and reasonably
requested by the REMIC Administrator to enable it to perform its obligations
under this Article. Without limiting the generality of the foregoing, the
Depositor, within ten days following the REMIC Administrator's request therefor,
shall provide in writing to the REMIC Administrator such information as is
reasonably requested by the REMIC Administrator for tax purposes, as to the
valuations and issue prices of the Certificates, and the REMIC Administrator's
duty to perform its reporting and other tax compliance obligations under this
Article X shall be subject to the condition that it receives from the Depositor
such information possessed by the Depositor that is necessary to permit the
Trustee to perform such obligations.
(h) The REMIC Administrator shall perform on behalf of each of REMIC I,
REMIC II and REMIC III all reporting and other tax compliance duties that are
the responsibility of each such REMIC under the Code, the REMIC Provisions or
other compliance guidance issued by the Internal Revenue Service or, with
respect to State and Local Taxes, any state or local taxing authority. Included
among such duties, the REMIC Administrator shall provide to: (i) any Transferor
of a Residual Certificate, such information as is necessary for the application
of any tax relating to the transfer of a Residual Certificate to any Person who
is not a Permitted Transferee; (ii) the Certificateholders, such information or
reports as are required by the Code or the REMIC Provisions, including, without
limitation, reports relating to interest, original issue discount and market
discount or premium (using the Prepayment Assumption as required hereunder); and
(iii) the Internal Revenue Service, the name, title, address and telephone
number of the Person who will serve as the representative of each of REMIC I,
REMIC II and REMIC III.
(i) The REMIC Administrator shall perform its duties hereunder so as to
maintain the status of each of REMIC I, REMIC II and REMIC III as a REMIC under
the REMIC Provisions (and the Trustee, the Master Servicer and the Special
Servicer shall assist the REMIC Administrator to the extent reasonably requested
by the REMIC Administrator and to the extent of information within the
Trustee's, the Master Servicer's or the Special Servicer's possession or
control). None of the REMIC Administrator, Master Servicer, the Special
Servicer, the REMIC Administrator or the Trustee shall knowingly take (or cause
any of REMIC I, REMIC II or REMIC III to take) any action or fail to take (or
fail to cause to be taken) any action that, under the REMIC Provisions, if taken
or not taken, as the case may be, could (i) endanger the status of any of REMIC
I, REMIC II or REMIC III as a REMIC, or (ii)
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except as provided in Section 3.17(a), result in the imposition of a tax upon
any of REMIC I, REMIC II or REMIC III (including, but not limited to, the tax on
prohibited transactions as defined in Section 860F(a)(2) of the Code, the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code or the result
in the imposition of a tax on "net income from foreclosure property" as defined
in Section 860G(c) of the Code) (any such endangerment or imposition, except as
provided in Section 3.17(a)(iii), an "Adverse REMIC Event"), unless the REMIC
Administrator has obtained or received an Opinion of Counsel (at the expense of
the party requesting such action or at the expense of the Trust Fund if the
REMIC Administrator seeks to take such action or to refrain from acting for the
benefit of the Certificateholders) to the effect that the contemplated action
will not result in an Adverse REMIC Event. The REMIC Administrator shall not
take any action or fail to take any action (whether or not authorized hereunder)
as to which the Master Servicer or the Special Servicer has advised it in
writing that either the Master Servicer or the Special Servicer has received or
obtained an Opinion of Counsel to the effect that an Adverse REMIC Event could
occur with respect to such action. In addition, prior to taking any action with
respect to REMIC I, REMIC II or REMIC III, or causing any of REMIC I, REMIC II
or REMIC III to take any action, that is not expressly permitted under the terms
of this Agreement, the Master Servicer and the Special Servicer shall consult
with the REMIC Administrator or its designee, in writing, with respect to
whether such action could cause an Adverse REMIC Event to occur. Neither the
Master Servicer nor the Special Servicer shall take any such action or cause any
of REMIC I, REMIC II or REMIC III to take any such action as to which the REMIC
Administrator has advised it in writing that an Adverse REMIC Event could occur,
and neither the Master Servicer nor the Special Servicer shall have any
liability hereunder for any action taken by it in accordance with the written
instruments of the REMIC Administrator. The REMIC Administrator may consult with
counsel to make such written advice, and the cost of same shall be borne by the
party seeking to take the action not permitted by this Agreement, but in no
event at the cost or expense of the Trust Fund or the Trustee. At all times as
may be required by the Code, the REMIC Administrator shall make reasonable
efforts to ensure that substantially all of the assets of REMIC I, REMIC II and
REMIC III will consist of "qualified mortgages" as defined in Section 860G(a)(3)
of the Code and "permitted investments" as defined in Section 860G(a)(5) of the
Code.
(j) If any tax is imposed on any of REMIC I, REMIC II or REMIC III,
including, without limitation, "prohibited transactions" taxes as defined in
Section 860F(a)(2) of the Code, any tax on "net income from foreclosure
property" as defined in Section 860G(c) of the Code, any taxes on contributions
to REMIC I, REMIC II or REMIC III after the Startup Day pursuant to Section
860G(d) of the Code, and any other tax imposed by the Code or any applicable
provisions of State or Local Tax laws (other than any tax permitted to be
incurred by the Special Servicer pursuant to Section 3.17(a)), such tax,
together with all incidental costs and expenses (including, without limitation,
penalties and reasonable attorneys' fees), shall be charged to and paid by: (i)
the REMIC Administrator, if such tax arises out of or results from a breach by
the REMIC Administrator of any of its obligations under this Article X provided
that no liability shall be imposed upon the REMIC Administrator under this
clause if another party has responsibility for payment of such tax under clauses
(ii) - (vi) of this Section; (ii) the Special Servicer, if such tax arises out
of or
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results from a breach by the Special Servicer of any of its obligations
under Article III or this Article X; (iii) the Master Servicer, if such tax
arises out of or results from a breach by the Master Servicer of any of its
obligations under Article III or this Article X; (iv) the Trustee, if such tax
arises out of or results from a breach by the Trustee of any of its obligations
under this Article X; (v) the Depositor, if such tax was imposed due to the fact
that any of the Mortgage Loans did not, at the time of their transfer to the
REMIC I, constitute a "qualified mortgage" as defined in Section 860G(a)(3) of
the Code; or (vi) the Trust Fund in all other instances. Any tax permitted to be
incurred by the Special Servicer pursuant to Section 3.17(a)(iii) shall be
charged to and paid by the Trust Fund. Any such amounts payable by the Trust
Fund shall be paid by the Paying Agent upon the written direction of the REMIC
Administrator out of amounts on deposit in the Distribution Account in reduction
of the Available Distribution Amount pursuant to Section 3.05(b).
(k) The REMIC Administrator shall, for federal income tax purposes,
maintain books and records with respect to each of REMIC I, REMIC II and REMIC
III on a calendar year and on an accrual basis.
(1) Following the Startup Day, none of the Trustee, the Master Servicer and
the Special Servicer shall accept any contributions of assets to REMIC I, REMIC
II or REMIC III unless it shall have received an Opinion of Counsel (at the
expense of the party seeking to cause such contribution and in no event at the
expense of the Trust Fund or the Trustee) to the effect that the inclusion of
such assets in such REMIC will not cause: (i) such REMIC to fail to qualify as a
REMIC at any time that any Certificates are outstanding; or (ii) the imposition
of any tax on such REMIC under the REMIC Provisions or other applicable
provisions of federal, state and local law or ordinances.
(m) None of the Trustee, the Master Servicer and the Special Servicer shall
consent to or, to the extent it is within the control of such Person, permit:
(i) the sale or disposition of any of the Mortgage Loans (except in connection
with (A) the foreclosure of a Mortgage Loan, including, but not limited to, the
sale or other disposition of a Mortgaged Property acquired by deed in lieu of
foreclosure, (B) the bankruptcy of REMIC I, REMIC II or REMIC III, (C) the
termination of REMIC I, REMIC II and REMIC III pursuant to Article IX of this
Agreement, or (D) a purchase of Mortgage Loans pursuant to or as contemplated by
Article II or III of this Agreement); (ii) the sale or disposition of any
investments in the Certificate Account, the Distribution Account or the REO
Account for gain; or (iii) the acquisition of any assets for REMIC I, REMIC II
or REMIC III (other than a Mortgaged Property acquired through foreclosure, deed
in lieu of foreclosure or otherwise in respect of a defaulted Mortgage Loan and
other than Permitted Investments acquired in connection with the investment of
funds in the Certificate Account, the Distribution Account or the REO Account);
in any event unless it has received an Opinion of Counsel (at the expense of the
party seeking to cause such sale, disposition, or acquisition but in no event at
the expense of the Trust Fund or the Trustee) to the effect that such sale,
disposition, or acquisition will not cause: (x) REMIC I, REMIC II or REMIC III
to fail to qualify as a REMIC at any time that any Certificates are outstanding;
or (y) the imposition of any tax on REMIC I, REMIC II or
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REMIC III under the REMIC Provisions or other applicable provisions of federal,
state and local law or ordinances.
(n) Except in connection with Section 3.17(a)(iii), none of the Trustee,
the Master Servicer and the Special Servicer shall enter into any arrangement by
which REMIC I, REMIC II or REMIC III will receive a fee or other compensation
for services nor permit REMIC I, REMIC II or REMIC III to receive any income
from assets other than "qualified mortgages" as defined in Section 860G(a)(3) of
the Code or "permitted investments" as defined in Section 860G(a)(5) of the
Code.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment.
(a) Except as otherwise provided in Section 7.06(c), this Agreement may be
amended from time to time by the mutual agreement of the Depositor, the Master
Servicer, the Special Servicer and the Trustee, without the consent of any of
the Certificateholders, (i) to cure any ambiguity, (ii) to correct, modify or
supplement any provision herein which may be inconsistent with any other
provision herein, (iii) to add any other provisions with respect to matters or
questions arising hereunder which shall not be inconsistent with the provisions
hereof, (iv) to relax or eliminate any requirement hereunder imposed by the
REMIC Provisions if the REMIC Provisions are amended or clarified such that any
such requirement may be relaxed or eliminated, or (v) if such amendment, as
evidenced by an Opinion of Counsel delivered to the Master Servicer, the Special
Servicer and the Trustee, is reasonably necessary to comply with any
requirements imposed by the Code or any successor or amendatory statute or any
temporary or final regulation, revenue ruling, revenue procedure or other
written official announcement or interpretation relating to federal income tax
laws or any such proposed action which, if made effective, would apply
retroactively to any of the REMICs created hereunder at least from the effective
date of such amendment, or would be necessary to avoid the occurrence of a
prohibited transaction or to reduce the incidence of any tax that would arise
from any actions taken with respect to the operation of any such REMIC; provided
that such action (except any amendment described in clause (v) above) shall not,
as evidenced by an Opinion of Counsel obtained by or delivered to the Master
Servicer, the Special Servicer and the Trustee (which opinion, insofar as
economic issues are concerned, may rely upon the assurance of the Rating
Agencies described below), adversely affect in any material respect the
interests of any Certificateholder; and provided further that the Master
Servicer, the Special Servicer, the Fiscal Agent and the Trustee shall have
first obtained from each Rating Agency written assurance that such amendment
will not cause the qualification, downgrading or withdrawal of the then current
rating on any Class of Certificates.
(b) Except as otherwise provided in Section 7.06(c), this Agreement may
also be amended from time to time by the agreement of the Depositor, the Master
Servicer, the Special Servicer, the Fiscal Agent and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in any
manner the amount of, or delay the timing of, payments received or advanced on
Mortgage Loans which are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, (ii) as evidenced by an Opinion
of Counsel obtained by or delivered to the Master Servicer, the Special
Servicer, the Fiscal Agent and the Trustee (which opinion, insofar as economic
issues are concerned, may rely upon the assurance of the Rating Agencies
described below), adversely affect in any material respect the interests of the
Holders of any Class of Certificates in a manner other than as described in (i)
without the consent of the Holders of all
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Certificates of such Class, (iii) modify the provisions of this Section 11.01
without the consent of the Holders of all Certificates then outstanding, (iv)
modify the provisions of Section 3.20 without the consent of the Holders of
Certificates entitled to all of the Voting Rights or (v) modify the specified
percentage of Voting Rights which are required to be held by Certificateholders
to consent or not to object to any action pursuant to any provision of this
Agreement without the consent of the Holders of all Certificates then
outstanding. Notwithstanding any other provision of this Agreement, for purposes
of the giving or withholding of consents pursuant to this Section 11.01,
Certificates registered in the name of the Depositor or any Affiliate of the
Depositor shall be entitled to the same Voting Rights with respect to matters
described above as they would if any other Person held such Certificates, so
long as neither the Depositor nor any of its Affiliates is performing servicing
duties with respect to any of the Mortgage Loans.
(c) Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall first have
obtained or been furnished with an Opinion of Counsel (at the expense of the
party seeking such amendment) to the effect that (i) such amendment or the
exercise of any power granted to the Trustee, the Fiscal Agent, the Master
Servicer or the Special Servicer in accordance with such amendment will not
result in the imposition of a tax on either of REMIC I, REMIC II or REMIC III
pursuant to the REMIC Provisions or cause either of REMIC I, REMIC II or REMIC
III to fail to qualify as a REMIC at any time that any Certificates are
outstanding and (ii) such amendment complies with the provisions of this Section
11.01.
(d) Promptly after the execution of any such amendment, the Trustee shall
send a copy thereof to each Certificateholder.
(e) It shall not be necessary for the consent of Certificateholders under
this Section 11.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
(f) Each of the Master Servicer, the Special Servicer, the Fiscal Agent and
the Trustee may but shall not be obligated to enter into any amendment pursuant
to this Section that affects its rights, duties and immunities under this
Agreement or otherwise.
(g) The cost of any Opinion of Counsel to be delivered pursuant to Section
11.01(a), (b) or (c) shall be borne by the Person seeking the related amendment,
except that if the Master Servicer, the Special Servicer, the Fiscal Agent or
the Trustee requests any amendment of this Agreement that protects or is in
furtherance of the rights and interests of Certificateholders, the cost of any
Opinion of Counsel required in connection therewith pursuant to Section 11.01(a)
or (c) shall be payable out of the Certificate Account or the Distribution
Account pursuant to Section 3.05.
<PAGE>
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SECTION 11.02. Recordation of Agreement; Counterparts.
(a) To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Master Servicer at the expense of the Trust Fund, but only upon direction
accompanied by an Opinion of Counsel (the cost of which may be paid out of the
Certificate Account pursuant to Section 3.05(a)) to the effect that such
recordation materially and beneficially affects the interests of the
Certificateholders; provided, however, that the Trustee shall have no obligation
or responsibility to determine whether any such recordation of this Agreement is
required.
(b) For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
SECTION 11.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust Fund, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
(b) No Certificateholder shall have any right to vote (except as expressly
provided for herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any provision of
this Agreement to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Agreement or any Mortgage Loan, unless,
with respect to any suit, action or proceeding upon or under or with respect to
this Agreement, such Holder previously shall have given to the Trustee a written
notice of default hereunder, and of the continuance thereof, as hereinbefore
provided, and unless also the Holders of Certificates entitled to at least 25%
of the Voting Rights shall have made written request upon the Trustee to
institute such action, suit or proceeding in its own name as Trustee hereunder
and shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses and liabilities to be incurred therein or
thereby, and the Trustee, for 60 days after its receipt of such notice, request
and offer of indemnity, shall have neglected or refused to institute any such
action, suit or proceeding. It is understood and intended, and expressly
covenanted by each
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Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates shall have any right in any manner
whatsoever by virtue of any provision of this Agreement to affect, disturb or
prejudice the rights of the Holders of any other of such Certificates, or to
obtain or seek to obtain priority over or preference to any other such Holder,
which priority or preference is not otherwise provided for herein, or to enforce
any right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
SECTION 11.04. Governing Law.
This Agreement and the Certificates shall be construed in accordance with
the internal laws of the State of New York applicable to agreements made and to
be performed in said State, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
SECTION 11.05. Notices.
Any communications provided for or permitted hereunder shall be in writing
and, unless otherwise expressly provided herein, shall be deemed to have been
duly given when delivered to: (i) in the case of the Depositor, Merrill Lynch
Mortgage Investors, Inc., World Financial Center, North Tower, 250 Vesey Street,
New York, New York 10281, Attention: the Secretary, with a copy to the
treasurer, facsimile number: 212-449-0735; (ii) in the case of the Master
Servicer, GE Capital Asset Management Corporation, 363 N. Sam Houston Parkway
E., 12th Floor, Houston, Texas 77060, Attention: Legal Department MLMI 1997 C-1,
facsimile number: 281-405-7153; (iii) in the case of the Special Servicer, GE
Capital Realty Group, Inc., 16479 Dallas Parkway, Suite 400, Dallas, Texas
75248, Attention: Legal Department-MLMI 1997 C-1, facsimile number:
214-447-2647; (iv) in the case of the Trustee, the Corporate Trust Office,
facsimile number: 312-904-2084; and (v) in the case of the Rating Agencies, (A)
Fitch Investors Service, L.P., One State Street Plaza, New York, New York 10004,
Attention: Commercial Mortgage Surveillance, facsimile number: 212-635-0295; (B)
Moody's Investors Service, Inc., 99 Church Street, New York, New York 10007,
Attention: CMBS Monitoring; facsimile number: 212-553-1350; and (C) Standard &
Poor's Ratings Group, 25 Broadway, New York, New York 10004, Attention: Real
Estate Ratings Group, Surveillance Manager, facsimile number: 212-412-0597; or
as to each such Person such other address as may hereafter be furnished by such
Person to the parties hereto in writing. Any communication required or permitted
to be delivered to a Certificateholder shall be deemed to have been duly given
when mailed first class, postage prepaid, to the address of such Holder as shown
in the Certificate Register.
SECTION 11.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements,
<PAGE>
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provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.
SECTION 11.07. Grant of a Security Interest.
The Depositor intends that the conveyance of the Depositor's right, title
and interest in and to the Mortgage Loans pursuant to this Agreement shall
constitute a sale and not a pledge of security for a loan. If such conveyance is
deemed to be a pledge of security for a loan, however, the Depositor intends
that the rights and obligations of the parties to such loan shall be established
pursuant to the terms of this Agreement. The Depositor also intends and agrees
that, in such event, (i) the Depositor shall be deemed to have granted to the
Trustee (in such capacity) a first priority security interest in the Depositor's
entire right, title and interest in and to the assets constituting the Trust
Fund, including, without limitation, the Mortgage Loans, all principal and
interest received or receivable with respect to the Mortgage Loans (other than
principal and interest payments due and payable prior to the Cut-off Date and
any Principal Prepayments received prior to the Cut-off Date), all amounts held
from time to time in the Certificate Account, the Distribution Account and, if
established, the REO Account and all reinvestment earnings on such amounts, and
all of the Depositor's right, title and interest in and to the proceeds of any
title, hazard or other Insurance Policies related to such Mortgage Loans, and
(ii) this Agreement shall constitute a security agreement under applicable law.
The Depositor shall file or cause to be filed, as a precautionary filing, a Form
UCC-1 substantially in the form attached as Exhibit J hereto in all appropriate
locations in the State of New York promptly following the initial issuance of
the Certificates, and the Master Servicer shall prepare and file at each such
office, and the Trustee shall execute, continuation statements with respect
thereto, in each case within six months prior to the fifth anniversary of the
immediately preceding filing. The Depositor shall cooperate in a reasonable
manner with the Trustee and the Master Servicer in preparing and filing such
continuation statements. This Section 11.07 shall constitute notice to the
Trustee pursuant to any of the requirements of the New York UCC.
SECTION 11.08. Successors and Assigns; Beneficiaries.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the respective successors and assigns of the parties hereto, and all
such provisions shall inure to the benefit of the Certificateholders. No other
person, including, without limitation, any Mortgagor, shall be entitled to any
benefit or equitable right, remedy or claim under this Agreement.
SECTION 11.9. Article and Section Headings.
The article and section headings herein are for convenience of reference
only, and shall not limit or otherwise affect the meaning hereof.
<PAGE>
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SECTION 11.10. Notices to Rating Agencies.
(a) The Trustee shall promptly provide notice to each Rating Agency with
respect to each of the following of which it has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Event of Default that has not been cured;
(iii) the resignation or termination of the Master Servicer or the
Special Servicer;
(iv) the repurchase of Mortgage Loans by any of the Mortgage Loan
Sellers pursuant to either of the Mortgage Loan Purchase Agreements;
(v) any change in the location of the Distribution Account; and
(vi) the final payment to any Class of Certificateholders.
(b) The Master Servicer shall promptly provide notice to each Rating Agency
with respect to each of the following of which it has actual knowledge:
(i) the resignation or removal of the Trustee or the Fiscal Agent; and
(ii) any change in the location of the Certificate Account or the
Additional Interest Distribution Account.
(c) The Special Servicer shall furnish each Rating Agency with respect to a
non-performing or defaulted Mortgage Loan such information as the Rating Agency
shall reasonably request and which the Special Servicer can reasonably provide
in accordance with applicable law and without waiving any attorney-client
privilege attached to such information. The Special Servicer may attach any
reasonable disclaimer it deems appropriate to such information.
(d) To the extent applicable, each of the Master Servicer and the Special
Servicer shall promptly furnish to each Rating Agency copies of the following
items:
(i) each of its annual statements as to compliance described in
Section 3.13;
(ii) each of its annual independent public accountants' servicing
reports described in Section 3.14;
(iii) any Officers' Certificate delivered to the Trustee pursuant to
Section 4.03(c) or 3.08;
<PAGE>
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(iv) each of the inspection reports described in Section 3.12(a) and
the statements and reports described in Section 3.12(b); and
(v) each Updated Mortgage Loan Schedule described in Section 3.12(c).
(e) The Trustee shall (i) make available to each Rating Agency, upon
reasonable notice, the items described in Section 3.15 and Section 4.02(a) and
(ii) promptly deliver to each Rating Agency a copy of any notices given pursuant
to Section 7.03(a) or Section 7.03(b).
SECTION 11.11. Complete Agreement.
This Agreement embodies the complete agreement among the parties and may
not be varied or terminated except by a written agreement conforming to the
provisions of Section 11.01. All prior negotiations or representations of the
parties are merged into this Agreement and shall have no force or effect unless
expressly stated herein.
<PAGE>
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IN WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto by their respective officers thereunto duly authorized, in each case as
of the day and year first above written.
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Depositor
By: /s/ Bruce L. Ackerman
-----------------------------------------
Name: Bruce L. Ackerman
Title: Vice President
GE CAPITAL ASSET MANAGEMENT CORPORATION
Master Servicer
By: /s/ Bethann C. Roberts
-----------------------------------------
Name: Bethann C. Roberts
Title: President and Chief Executive
Officer
GE CAPITAL REALTY GROUP, INC.
Special Servicer
By: /s/ Robert S. Riggs
----------------------------------------
Name: Robert S. Riggs
Title:
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Bethann C. Roberts
----------------------------------------
Name: Bethann C. Roberts
Title: Authorized Signatory
<PAGE>
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LaSALLE NATIONAL BANK
Trustee
By: /s/ Susan Franklin
----------------------------------------
Name: Susan Franklin
Title: Vice President
ABN AMRO BANK N.V.
Fiscal Agent
By: /s/ Robert C. Smolka
----------------------------------------
Name: Robert C. Smolka
Title: Group Vice President
By: /s/ Irene Pazik
----------------------------------------
Name: Irene Pazik
Title: Vice President
<PAGE>
CLASS A-1 MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: _____ per annum A-1 Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal
Agreement: Balance of this Class A-1
Certificate as of the Closing Date:
$
Closing Date: Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No. CUSIP No.
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G,
CLASS H, AND CLASS J CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE, THE CLASS A-2 CERTIFICATES
AND THE CLASS A-3 CERTIFICATES MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class A-1 Certificate (obtained by dividing the
principal amount of this Class A-1 Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class A-1 Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class A-1
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Merrill Lynch
Mortgage Investors, Inc. (hereinafter called the "Depositor", which term
-2-
<PAGE>
includes any successor entity under the Agreement), GE Capital Asset Management
Corporation (in such capacity, hereinafter called the "Master Servicer", which
term includes any successor entity under the Agreement), GE Capital Realty
Group, Inc. in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
18th day of each month or, if such 18th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of the
Class A-1 Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class A-1
Certificates will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or
-3-
<PAGE>
Additional Trust Fund Expense previously allocated to this Certificate, which
reimbursement is to occur after the date on which this Certificate is
surrendered as contemplated by the preceding sentence, will be made by check
mailed to the address of the Holder that surrenders this Certificate as such
address last appears in the Certificate Register or to any such other address of
which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of the
Certificate Principal Balance hereof is binding on such Holder and all future
Holders of this Certificate and any Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class A-1 Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class A-1
Certificates are exchangeable for new Class A-1 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-1 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of Class A-1 Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in
-4-
<PAGE>
connection with any transfer or exchange of Class A-1 Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Paying Agent and the Certificate Registrar and any agent of
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Paying Agent, the Certificate Registrar or any such agent
shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and each REO Property remaining in the Trust
Fund. The Agreement permits, but does not require, the Master Servicer or the
Depositor to purchase from the Trust Fund all Mortgage Loans and each REO
Property remaining therein. The exercise of such right will effect early
retirement of the Class A-1 Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Pool at the
time of purchase being less than 1% of the aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange
-5-
<PAGE>
herefor or in lieu hereof whether or not notation of such consent is made upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, including any amendment necessary to maintain the status
of the Trust Fund (or designated portions thereof) as a REMIC, without the
consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal laws of
the State of New York applicable to agreements made and to be performed in said
State, and the obligations, rights and remedies of the Holder hereof shall be
determined in accordance with such laws.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:
---------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1 Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK
as Authenticating Agent
By:
---------------------------------
Authorized Officer
-7-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
-8-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to ____________________________________________
_______________________________________________________________________________
for the account of ____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to ____________)
and all applicable statements and notices should be mailed to __________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee named
above, or ______________, as its agent.
-9-
<PAGE>
CLASS A-2 MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: _____ per annum A-2 Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal
Agreement: Balance of this Class A-2
Certificate as of the Closing
Date: $
Closing Date: Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No. CUSIP No.
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G,
CLASS H, AND CLASS J CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE, THE CLASS A-1 CERTIFICATES
AND THE CLASS A-3 CERTIFICATES MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class A-2 Certificate (obtained by dividing the
principal amount of this Class A-2 Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class A-2 Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class A-2
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Merrill Lynch
Mortgage Investors, Inc. (hereinafter called the "Depositor", which term
-2-
<PAGE>
includes any successor entity under the Agreement), GE Capital Asset Management
Corporation (in such capacity, hereinafter called the "Master Servicer", which
term includes any successor entity under the Agreement), GE Capital Realty
Group, Inc. (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
18th day of each month or, if such 18th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of the
Class A-2 Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class A-2
Certificates will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or
-3-
<PAGE>
Additional Trust Fund Expense previously allocated to this Certificate, which
reimbursement is to occur after the date on which this Certificate is
surrendered as contemplated by the preceding sentence, will be made by check
mailed to the address of the Holder that surrenders this Certificate as such
address last appears in the Certificate Register or to any such other address of
which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of the
Certificate Principal Balance hereof is binding on such Holder and all future
Holders of this Certificate and any Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class A-2 Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class A-2
Certificates are exchangeable for new Class A-2 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-2 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of Class A-2 Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in
-4-
<PAGE>
connection with any transfer or exchange of Class A-2 Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Paying Agent and the Certificate Registrar and any agent of the Depositor, the
Master Servicer, the Special Servicer, the Trustee, the Fiscal Agent, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Fiscal
Agent, the Paying Agent, the Certificate Registrar or any such agent shall be
affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and each REO Property remaining in the Trust
Fund. The Agreement permits, but does not require, the Master Servicer or the
Depositor to purchase from the Trust Fund all Mortgage Loans and each REO
Property remaining therein. The exercise of such right will effect early
retirement of the Class A-2 Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Pool at the
time of purchase being less than 1% of the aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange
-5-
<PAGE>
herefor or in lieu hereof whether or not notation of such consent is made upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, including any amendment necessary to maintain the status
of the Trust Fund (or designated portions thereof) as a REMIC, without the
consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal laws of
the State of New York applicable to agreements made and to be performed in said
State, and the obligations, rights and remedies of the Holder hereof shall be
determined in accordance with such laws.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:
---------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-2 Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:
---------------------------------
Authorized Officer
-7-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
-8-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to ____________________________________________
_______________________________________________________________________________
for the account of ____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to ____________)
and all applicable statements and notices should be mailed to _________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee named
above, or ______________, as its agent.
-9-
<PAGE>
CLASS A-3 MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: _____ per annum A-3 Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal
Agreement: Balance of this Class A-3
Certificate as of the Closing
Date: $
Closing Date: Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No. CUSIP No.
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G,
CLASS H, AND CLASS J CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE, THE CLASS A-1 CERTIFICATES
AND THE CLASS A-2 CERTIFICATES MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class A-3 Certificate (obtained by
dividing the principal amount of this Class A-3 Certificate (its "Certificate
Principal Balance") as of the Closing Date by the aggregate principal amount of
all the Class A-3 Certificates (their "Class Principal Balance") as of the
Closing Date) in that certain beneficial ownership interest evidenced by all the
Class A-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Merrill
Lynch Mortgage Investors, Inc. (hereinafter called the "Depositor", which term
-2-
<PAGE>
includes any successor entity under the Agreement), GE Capital Asset Management
Corporation (in such capacity, hereinafter called the "Master Servicer", which
term includes any successor entity under the Agreement), GE Capital Realty
Group, Inc. (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
18th day of each month or, if such 18th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of the
Class A-3 Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class A-3
Certificates will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or
-3-
<PAGE>
Additional Trust Fund Expense previously allocated to this Certificate, which
reimbursement is to occur after the date on which this Certificate is
surrendered as contemplated by the preceding sentence, will be made by check
mailed to the address of the Holder that surrenders this Certificate as such
address last appears in the Certificate Register or to any such other address of
which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of the
Certificate Principal Balance hereof is binding on such Holder and all future
Holders of this Certificate and any Certificate issued upon the transfer hereof
or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class A-3 Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class A-3
Certificates are exchangeable for new Class A-3 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-3 Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of Class A-3 Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in
-4-
<PAGE>
connection with any transfer or exchange of Class A-3 Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Paying Agent and the Certificate Registrar and any agent of the Depositor, the
Master Servicer, the Special Servicer, the Trustee, the Fiscal Agent, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Fiscal
Agent, the Paying Agent, the Certificate Registrar or any such agent shall be
affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and each REO Property remaining in the Trust
Fund. The Agreement permits, but does not require, the Master Servicer or the
Depositor to purchase from the Trust Fund all Mortgage Loans and each REO
Property remaining therein. The exercise of such right will effect early
retirement of the Class A-3 Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Pool at the
time of purchase being less than 1% of the aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
Fiscal Agent and the rights of the Certificateholders under the Agreement at any
time by the Depositor, the Master Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of Certificates entitled to
at least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange
-5-
<PAGE>
herefor or in lieu hereof whether or not notation of such consent is made upon
this Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, including any amendment necessary to maintain the status
of the Trust Fund (or designated portions thereof) as a REMIC, without the
consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal laws of
the State of New York applicable to agreements made and to be performed in said
State, and the obligations, rights and remedies of the Holder hereof shall be
determined in accordance with such laws.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:
---------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-3 Certificates referred to in the within-
mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:
---------------------------------
Authorized Officer
-7-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to ____________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
for the account of ____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to ____________)
and all applicable statements and notices should be mailed to _________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee named
above, or ______________, as its agent.
-9-
<PAGE>
CLASS IO MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Date of Pooling and Servicing Aggregate Certificate Notional
Agreement: Amount of the Class IO Certificates
as of the Closing Date:
$
Closing Date: Certificate Notional Amount of this
Class IO Certificate as of the
Closing Date:
$
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No. CUSIP No.
THIS CERTIFICATE IS NOT ENTITLED TO INTEREST ON THE CERTIFICATE NOTIONAL
AMOUNT, BUT IS ENTITLED TO RECEIVE INTEREST ON ITS COMPONENTS AS SET FORTH IN
THE POOLING AND SERVICING AGREEMENT
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE"). THE FOLLOWING INFORMATION IS PROVIDED SOLELY
FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT
("OID") RULES TO THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS JUNE
26, 1997. ASSUMING THAT THE MORTGAGE LOANS PREPAY AT AN ASSUMED RATE OF
PREPAYMENT USED SOLELY FOR THE PURPOSES OF APPLYING THE OID RULES TO THE
CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE PROSPECTUS DATED JUNE 5, 1997 AND
THE PROSPECTUS SUPPLEMENT DATED JUNE 20, 1997 RELATING TO THIS CERTIFICATE) OF
0% (THE "PREPAYMENT ASSUMPTION"), THIS $200,000,000 OF INITIAL COMPONENT
NOTIONAL AMOUNT, THE YIELD TO MATURITY IS ___% PER ANNUM, AND THE AMOUNT OF OID
ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____________ PER
$1,000 OF INITIAL CERTIFICATE NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD.
NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON
THE PREPAYMENT ASSUMPTION OR AT ANY OTHER RATE.
THIS CERTIFICATE DOES NOT HAVE A CERTIFICATE PRINCIPAL BALANCE AND WILL NOT
ENTITLE THE HOLDER HEREOF TO DISTRIBUTIONS OF PRINCIPAL.
-2-
<PAGE>
This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Class IO Certificate in that certain beneficial
ownership interest evidenced by all the Class IO Certificates in the Trust Fund
created pursuant to a Pooling and Servicing Agreement, dated as specified above
(the "Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter
called the "Depositor", which term includes any successor entity under the
Agreement), GE Capital Asset Management Corporation (in such capacity,
hereinafter called the "Master Servicer", which term includes any successor
entity under the Agreement), GE Capital Realty Group, Inc. (in such capacity,
hereinafter called the "Special Servicer", which term includes any successor
entity under the Agreement), General Electric Capital Corporation (or any
successor entity under the Agreement), ABN AMRO Bank N.V. (hereinafter called
the "Fiscal Agent", which term includes any successor entity under the
Agreement) and LaSalle National Bank (hereinafter called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on the
18th day of each month or, if such 18th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of the
Class IO Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class IO
Certificates will be made by LaSalle National Bank as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) and is the registered owner of Class
IO Certificates the aggregate initial Certificate Notional Amount of which is at
least $5,000,000, or otherwise by check mailed to the address of such
Certificateholder as it
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<PAGE>
appears in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate will be made in like manner, but only upon
presentation and surrender of this Certificate at the offices of the Trustee or
such other location specified in the notice to Certificateholders of such final
distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class IO Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class IO
Certificates are exchangeable for new Class IO Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices of the Certificate Registrar, duly endorsed by, or accompanied by a
written instrument of transfer in the form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class IO Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer or
exchange of Class IO Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class IO
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Fiscal Agent, the Paying Agent and the Certificate Registrar and any agent of
the Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes,
-4-
<PAGE>
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, Certificate Registrar or any such
agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall terminate
upon distribution (or provision for distribution) to the Certificateholders of
all amounts held by or on behalf of the Trustee and required to be distributed
to them pursuant to the Agreement following the earlier of (i) the final payment
or other liquidation (or any advance with respect thereto) of the last Mortgage
Loan or REO Property remaining in the Trust Fund, and (ii) the purchase by the
Master Servicer or the Depositor at a price determined as provided in the
Agreement of all Mortgage Loans and each REO Property remaining in the Trust
Fund. The Agreement permits, but does not require, the Master Servicer or the
Depositor to purchase from the Trust Fund all Mortgage Loans and each REO
Property remaining therein. The exercise of such right will effect early
retirement of the Class IO Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Pool at the
time of purchase being less than 1% of the aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trusteeand the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by the
Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that it will
look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
-5-
<PAGE>
This Certificate shall be construed in accordance with the internal laws of
the State of New York applicable to agreements made and to be performed in said
State, and the obligations, rights and remedies of the Holder hereof shall be
determined in accordance with such laws.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:
---------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class IO Certificates referred to in the within-
mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:
---------------------------------
Authorized Officer
-7-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
-8-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to ____________________________________________
_______________________________________________________________________________
for the account of ____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to ____________)
and all applicable statements and notices should be mailed to _________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee named
above, or ______________, as its agent.
-9-
<PAGE>
CLASS B MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: _____ per annum B Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: of this Class B Certificate as of the
Closing Date: $
Closing Date: Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No. CUSIP No.
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<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS A-3 CERTIFICATES AND THE CLASS IO CERTIFICATES OF THE
SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH
INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL
ACCOUNT IF (I) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (II) THE
CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO
SUCH TRANSFER. AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F
CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE
PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON
DESCRIBED IN CLAUSE (B) OF THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO
THAT EFFECT SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO THE AGREEMENT.
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<PAGE>
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES AND THE CLASS A-3 CERTIFICATES OF THE SAME SERIES ARE
REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE
CERTIFICATE PRINCIPAL BALANCE OF THE CLASS C, CLASS D, CLASS E, CLASS F, CLASS
G, CLASS H, AND CLASS J CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN
LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING
CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class B Certificate (obtained by dividing
the principal amount of this Class B Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class B Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class B
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Merrill Lynch
Mortgage Investors, Inc. (hereinafter called the "Depositor", which term
includes any successor entity under the Agreement), GE Capital Asset Management
Corporation (in such capacity, hereinafter called the "Master Servicer", which
term includes any successor entity under the Agreement), GE Capital Realty
Group, Inc. (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
-3-
<PAGE>
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class B Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on this Class B
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
-4-
<PAGE>
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class B Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class B
Certificates are exchangeable for new Class B Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class B Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of a Class B Certificate or any interest therein shall
be made to (A) a Plan or (B) any Person who is directly or indirectly purchasing
the Class B Certificate or interest therein on behalf of, as named fiduciary of,
as trustee of, or with assets of a Plan (including, without limitation, any
insurance company using assets in its general or separate account that may
constitute assets of a Plan). As a condition to its registration of the transfer
of a Class B Certificate, the Certificate Registrar shall have the right to
require the prospective transferee of such Certificate, if it is not a Plan or
Person described in clause (B) of the preceding sentence, to execute a
certification to that effect substantially in the form of Exhibit H to the
Agreement.
No service charge will be imposed for any registration of transfer
or exchange of Class B Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class B
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
-5-
<PAGE>
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, the Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the Master Servicer or the Depositor to purchase from the Trust Fund
all Mortgage Loans and each REO Property remaining therein. The exercise of such
right will effect early retirement of the Class B Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trusteeand the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange hereof or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature,
-6-
<PAGE>
this Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:_________________________________
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Dated:
-------------------------------------------------
Signature by or on behalf of Assignor
-------------------------------------------------
Signature Guaranteed
-9-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to
________________________________________________________________________________
__________________________________________ for the account of
- ----------------------------------------------------------------.
Distributions made by check (such check to be made payable to
____________________________________) and all applicable statements and notices
should be mailed to ______________________
_______________________________________________________________________________.
This information is provided by ____________________, the Assignee
named above, or _____________________, as its agent.
-10-
<PAGE>
CLASS C MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: _____ per annum C Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: of this Class C Certificate as of the
Closing Date: $
Closing Date: Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No. CUSIP No.
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS IO
AND CLASS B CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING,
WITHOUT LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR
SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT
SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (I) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (II) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER.
AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE PROSPECTIVE TRANSFEREE
OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE AGREEMENT.
-2-
<PAGE>
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1, CLASS A-2,
CLASS A-3 AND CLASS B CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO,
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, AND CLASS
J CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class C Certificate (obtained by dividing
the principal amount of this Class C Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class C Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class C
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Merrill Lynch
Mortgage Investors, Inc. (hereinafter called the "Depositor", which term
includes any successor entity under the Agreement), GE Capital Asset Management
Corporation (in such capacity, hereinafter called the "Master Servicer", which
term includes any successor entity under the Agreement), GE Capital Realty
Group, Inc. (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
-3-
<PAGE>
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class C Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on this Class C
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
-4-
<PAGE>
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class C Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class C
Certificates are exchangeable for new Class C Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class C Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of a Class C Certificate or any interest therein shall
be made to (A) a Plan or (B) any Person who is directly or indirectly purchasing
the Class C Certificate or interest therein on behalf of, as named fiduciary of,
as trustee of, or with assets of a Plan (including, without limitation, any
insurance company using assets in its general or separate account that may
constitute assets of a Plan). As a condition to its registration of transfer of
a Class C Certificate, the Certificate Registrar shall have the right to require
the prospective transferee of such Certificate, if it is not a Plan or Person
described in clause (B) of the preceding sentence, to execute a certification to
that effect substantially in the form of Exhibit H to the Agreement.
No service charge will be imposed for any registration of transfer
or exchange of Class C Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class C
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
-5-
<PAGE>
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, the Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the Master Servicer or the Depositor to purchase from the Trust Fund
all Mortgage Loans and each REO Property remaining therein. The exercise of such
right will effect early retirement of the Class C Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature,
-6-
<PAGE>
this Certificate shall not be entitled to any benefit under the Agreement or be
valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By: _____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class C Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By: ______________________________
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
- --------------------------------------------------------------------------------
_________________________________________________________________.
- --------------------------------------------------------------------------------
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
-9-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to
____________________________________________________________ for the account of
________________________________________.
Distributions made by check (such check to be made payable to
____________________) and all applicable statements and notices should be mailed
to _____________________________________________________________________________
- ----------------------------------------------------------------.
This information is provided by _____________________, the Assignee
named above, or ________________________, as its agent.
-10-
<PAGE>
CLASS D MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: _____ per annum D Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: of this Class D Certificate as of the
Closing Date: $
Closing Date: Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No. CUSIP No.
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B AND CLASS C CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH
INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN); PROVIDED THAT SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL
ACCOUNT IF (I) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (II) THE
CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO
SUCH TRANSFER. AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F
CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE
PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON
DESCRIBED IN CLAUSE (B) OF THE PRECEDING
-2-
<PAGE>
SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN THE FORM OF
EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1 CLASS A-2, CLASS
A-3, CLASS B AND CLASS C CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO,
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS E, CLASS F, CLASS G, CLASS H, AND CLASS J
CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class D Certificate (obtained by dividing
the principal amount of this Class D Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class D Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class D
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Merrill Lynch
Mortgage Investors, Inc. (hereinafter called the "Depositor", which term
includes any successor entity under the Agreement), GE Capital Asset Management
Corporation (in such capacity, hereinafter called the "Master Servicer", which
term includes any successor entity under the Agreement), GE Capital Realty
Group, Inc. (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by
-3-
<PAGE>
virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class D Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on this Class D
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holders hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred,
-4-
<PAGE>
with respect to the Mortgage Loans and the payment of interest on such advances
and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class D Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class D
Certificates are exchangeable for new Class D Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class D Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of a Class D Certificate or any interest therein shall
be made to (A) a Plan or (B) any Person who is directly or indirectly purchasing
the Class D Certificate or interest therein on behalf of, as named fiduciary of,
as trustee of, or with assets of a Plan (including, without limitation, any
insurance company using assets in its general or separate account that may
constitute assets of a Plan). As a condition to its registration of transfer of
a Class D Certificate, the Certificate Registrar shall have the right to require
the prospective transferee of such Certificate, if it is not a Plan or Person
described in clause (B) of the preceding sentence, to execute a certification to
that effect substantially in the form of Exhibit H to the Agreement.
No service charge will be imposed for any registration of transfer
or exchange of Class D Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class D
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such
-5-
<PAGE>
other name as is requested by an authorized representative of DTC, transfers of
interests in this Certificate shall be made through the book-entry facilities of
DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, the Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the Master Servicer or the Depositor to purchase from the Trust Fund
all Mortgage Loans and each REO Property remaining therein. The exercise of such
right will effect early retirement of the Class D Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund
-6-
<PAGE>
(or designated portions thereof) as a REMIC, without the consent of the Holders
of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By: _______________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class D Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By: ______________________
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
- --------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
-9-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of distribution:
Distributions shall, if permitted, be made by wire transfer or otherwise,
in immediately available funds, to
- -------------------------------------------------------------------------------
for the account of ------------------------------------------------------------.
Distributions made by check (such check to be made payable to
____________________) and all applicable statements and notices should be mailed
to _____________________________________________________________________________
________________________________________________.
This information is provided by _________________________, the Assignee
named above, or ____________________________, as its agent.
-10-
<PAGE>
CLASS E MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: _____ per annum E Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: of this Class E Certificate as of the
Closing Date: $
Closing Date: Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management LaSalle National Bank
Corporation
Special Servicer: CUSIP No.
GE Capital Realty Group, Inc.
Certificate No.
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE CERTIFICATE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS IO
AND CLASS B, CLASS C AND CLASS D CERTIFICATES OF THE SAME SERIES TO THE EXTENT
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING,
WITHOUT LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR
SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT
SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (I) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (II) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER.
AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE PROSPECTIVE TRANSFEREE
OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE
-2-
<PAGE>
"CODE"). THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF
APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO
THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS JUNE 26, 1997. ASSUMING
THAT THE MORTGAGE LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR
THE PURPOSES OF APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS
DEFINED IN THE PROSPECTUS DATED JUNE 5, 1997 AND THE PROSPECTUS SUPPLEMENT DATED
JUNE 20, 1997 RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"),
THIS $16,816,000 OF INITIAL CERTIFICATE BALANCE AMOUNT, THE YIELD TO MATURITY IS
____% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL
PERIOD IS NO MORE THAN $___________ PER $1,000 OF INITIAL CERTIFICATE BALANCE
AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE THAT THE
MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT ASSUMPTION OR AT
ANY OTHER RATE.
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1, CLASS A-2,
CLASS A-3, CLASS B, CLASS C AND CLASS D CERTIFICATES OF THE SAME SERIES IS
REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE
CERTIFICATE PRINCIPAL BALANCE OF THE CLASS F, CLASS G, CLASS H, AND CLASS J
CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class E Certificate (obtained by dividing
the principal amount of this Class E Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class E Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class E
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Merrill Lynch
Mortgage Investors, Inc. (hereinafter called the "Depositor", which term
includes any successor entity under the Agreement), GE Capital Asset Management
Corporation (in such capacity, hereinafter called the "Master Servicer", which
term includes any successor entity under the Agreement), GE Capital Realty
Group, Inc. (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings
-3-
<PAGE>
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class D Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on this Class E
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holders hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
-4-
<PAGE>
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class E Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class E
Certificates are exchangeable for new Class E Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class E Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of a Class E Certificate or any interest therein shall
be made to (A) a Plan or (B) any Person who is directly or indirectly purchasing
the Class D Certificate or interest therein on behalf of, as named fiduciary of,
as trustee of, or with assets of a Plan (including, without limitation, any
insurance company using assets in its general or separate account that may
constitute assets of a Plan). As a condition to its registration of transfer of
a Class E Certificate, the Certificate Registrar shall have the right to require
the prospective transferee of such Certificate, if it is not a Plan or Person
described in clause (B) of the preceding sentence, to execute a certification to
that effect substantially in the form of Exhibit H to the Agreement.
No service charge will be imposed for any registration of transfer
or exchange of Class E Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class E
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or
-5-
<PAGE>
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Special Servicer, the Trustee, the Fiscal Agent, the Paying
Agent, the Certificate Registrar or any such agent shall be affected by notice
to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the Master Servicer or the Depositor to purchase from the Trust Fund
all Mortgage Loans and each REO Property remaining therein. The exercise of such
right will effect early retirement of the Class D Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to
-6-
<PAGE>
agreements made and to be performed in said State, and the obligations, rights
and remedies of the Holder hereof shall be determined in accordance with such
laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class E Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK
as Authenticating Agent
By:______________________________
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of Assignor
-------------------------------------
Signature Guaranteed
-9-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to
- --------------------------------------------------------------------------------
for the account of_____________________________________________________________
- -------------------------------------------------------------------------------.
Distributions made by check (such check to be made
payable to_________________________________ ) and all applicable statements and
notices should be mailed to ____________________________________
_____________________________________________________________________________.
This information is provided by ______________________,
the Assignee named above, or ______________, as its agent.
-10-
<PAGE>
CLASS F MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: ____% per annum F Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal
Agreement: Balance of this Class F Certificate
as of the Closing Date: $
Closing Date: Aggregate Stated Principal Balance
of the Mortgage Loans as of the
Closing Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer: CUSIP No.
GE Capital Realty Group, Inc.
Certificate No.
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B, CLASS C, CLASS D AND CLASS E CERTIFICATES OF THE SAME SERIES TO THE
EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING,
WITHOUT LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR
SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT (a)
SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (i) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER
AND (b) SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH
TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF
THE CODE. AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F
CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE
PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON
DESCRIBED IN CLAUSE (B) OF THE
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PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS JUNE 26, 1997. ASSUMING THAT THE MORTGAGE
LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF
APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE
PROSPECTUS DATED JUNE 5, 1997 AND THE PROSPECTUS SUPPLEMENT DATED JUNE 20, 1997
RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"), THIS
$1,000,000 OF INITIAL CERTIFICATE BALANCE AMOUNT, THE YIELD TO MATURITY IS ___%
PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS
NO MORE THAN $____________ PER $1,000 OF INITIAL CERTIFICATE NOTIONAL AMOUNT,
COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE
LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT ASSUMPTION OR AT ANY OTHER
RATE.
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1, CLASS A-2,
CLASS A-3, CLASS B, CLASS C, CLASS D AND CLASS E CERTIFICATES OF THE SAME SERIES
IS REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE
CERTIFICATE PRINCIPAL BALANCE OF THE CLASS G, CLASS H , AND CLASS J CERTIFICATES
OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE
TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Merrill Lynch, Pierce, Fenner & Smith is the
registered owner of the Percentage Interest evidenced by this Class F
Certificate (obtained by dividing the principal amount of this Class F
Certificate (its "Certificate Principal Balance") as of the Closing Date by the
aggregate principal amount of all the Class F Certificates (their "Class
Principal Balance") as of the Closing Date) in that certain beneficial ownership
interest evidenced by all the Class F Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter called
the "Depositor", which term includes any successor entity under the Agreement),
GE Capital Asset Management Corporation (in such capacity, hereinafter called
the "Master Servicer", which term includes any successor entity under the
Agreement), GE Capital
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Realty Group, Inc. (in such capacity, hereinafter called the "Special Servicer",
which term includes any successor entity under the Agreement), General Electric
Capital Corporation (or any successor entity under the Agreement), ABN AMRO Bank
N.V. (hereinafter called the "Fiscal Agent", which term includes any successor
entity under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class F Certificates on the applicable Distribution Date pursuant to the
Agreement. All Distributions made under the Agreement on this Class F
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address
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<PAGE>
last appears in the Certificate Register or to any such other address of which
the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class F Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class F
Certificates are exchangeable for new Class F Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class F Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class F Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor or any of its
affiliates), then the Certificate Registrar shall refuse to register such
transfer unless it receives either: (i) a certificate from the Certificateholder
desiring to effect such transfer substantially in the form
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<PAGE>
attached as Exhibit G-1 to the Agreement, and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
either Exhibit G-2 or Exhibit G-3 to the Agreement; or (ii) an Opinion of
Counsel satisfactory to the Certificate Registrar to the effect that such
transfer may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Trust Fund or of the
Depositor, the Master Servicer, the Special Servicer, the Trustee or the
Certificate Registrar in their respective capacities as such), together with the
written certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class F Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class F Certificate without
registration or qualification. Any Class F Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class F Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class F Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class F
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, the Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the
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<PAGE>
Master Servicer or the Depositor to purchase from the Trust Fund all Mortgage
Loans and each REO Property remaining therein. The exercise of such right will
effect early retirement of the Class F Certificates; however, such right to
purchase is subject to the aggregate Stated Principal Balance of the Mortgage
Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class F Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:
--------------------------------------
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
- ----------------------------------------------------
- ----------------------------------------------------
- ----------------------------------------------------
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:_____________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
--------------------------------------
Signature by or on behalf of Assignor
--------------------------------------
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to _________________________________
_______________________________________________________________________________
for the account of ____________________________________________________________.
_______________________________________________________________________________
Distributions made by check (such check to be made payable to
_______________________) and all applicable statements and notices should be
mailed to _____________________________________________________________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee
named above, or ______________, as its agent.
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<PAGE>
CLASS G MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: ____% per annum G Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal
Agreement: Balance of this Class G
Certificate as of the Closing
Date: $
Closing Date: Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer: CUSIP No.
GE Capital Realty Group, Inc.
Certificate No.
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B, CLASS C, CLASS D, CLASS E AND CLASS F CERTIFICATES OF THE SAME
SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING,
WITHOUT LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR
SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT (a)
SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (i) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER
AND (b) SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH
TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF
THE CODE. AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS G
CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE
PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON
DESCRIBED IN CLAUSE (B) OF THE
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PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS JUNE 26, 1997. ASSUMING THAT THE MORTGAGE
LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF
APPLYING THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE
PROSPECTUS DATED JUNE 5, 1997 AND THE PROSPECTUS SUPPLEMENT DATED JUNE 20, 1997
RELATING TO THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"), THIS
$1,799,039 OF INITIAL CERTIFICATE BALANCE AMOUNT, THE YIELD TO MATURITY IS ___%
PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS
NO MORE THAN $____________ PER $1,000 OF INITIAL CERTIFICATE NOTIONAL AMOUNT,
COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE
LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT ASSUMPTION OR AT ANY OTHER
RATE.
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1, CLASS A-2,
CLASS A-3, CLASS B, CLASS C, CLASS D, CLASS E AND CLASS F CERTIFICATES OF THE
SAME SERIES IS REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE
PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE
AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS H AND CLASS J CERTIFICATES
OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE
TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Merrill Lynch, Pierce, Fenner & Smith is the
registered owner of the Percentage Interest evidenced by this Class G
Certificate (obtained by dividing the principal amount of this Class G
Certificate (its "Certificate Principal Balance") as of the Closing Date by the
aggregate principal amount of all the Class G Certificates (their "Class
Principal Balance") as of the Closing Date) in that certain beneficial ownership
interest evidenced by all the Class G Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter called
the "Depositor", which term includes any successor entity under the Agreement),
GE Capital Asset Management Corporation (in such
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<PAGE>
capacity, hereinafter called the "Master Servicer", which term includes any
successor entity under the Agreement), GE Capital Realty Group, Inc. (in such
capacity, hereinafter called the "Special Servicer", which term includes any
successor entity under the Agreement), General Electric Capital Corporation (or
any successor entity under the Agreement), ABN AMRO Bank N.V. (hereinafter
called the "Fiscal Agent", which term includes any successor entity under the
Agreement) and LaSalle National Bank (hereinafter called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class F Certificates on the applicable Distribution Date pursuant to the
Agreement. All Distributions made under the Agreement on this Class G
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the
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<PAGE>
preceding sentence, will be made by check mailed to the address of the Holder
that surrenders this Certificate as such address last appears in the Certificate
Register or to any such other address of which the Trustee is subsequently
notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class G Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class G
Certificates are exchangeable for new Class G Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class G Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class G Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor or any of its
affiliates), then the Certificate Registrar shall refuse to register such
transfer unless it
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<PAGE>
receives either: (i) a certificate from the Certificateholder desiring to effect
such transfer substantially in the form attached as Exhibit G-1 to the
Agreement, and a certificate from such Certificateholder's prospective
transferee substantially in the form attached as either Exhibit G-2 or Exhibit
G-3 to the Agreement; or (ii) an Opinion of Counsel satisfactory to the
Certificate Registrar to the effect that such transfer may be made without
registration under the Securities Act (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Master Servicer, the Special
Servicer, the Trustee or the Certificate Registrar in their respective
capacities as such), together with the written certification(s) as to the facts
surrounding such transfer from the Certificateholder desiring to effect such
transfer and/or such Certificateholder's prospective transferee on which such
Opinion of Counsel is based. None of the Depositor, the Trustee or the
Certificate Registrar is obligated to register or qualify the Class G
Certificates under the Securities Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of any
Class G Certificate without registration or qualification. Any Class G
Certificateholder desiring to effect such a transfer shall, and by the
acceptance of its Class G Certificate agrees to, indemnify the Trustee, the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class G Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class G
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, the Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement
-6-
<PAGE>
of all Mortgage Loans and each REO Property remaining in the Trust Fund. The
Agreement permits, but does not require, the Master Servicer or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class F
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class G Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:
--------------------------------------
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
- ----------------------------------------------------
- ----------------------------------------------------
- ----------------------------------------------------
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:_____________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
--------------------------------------
Signature by or on behalf of Assignor
--------------------------------------
Signature Guaranteed
-9-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to _________________________________
_______________________________________________________________________________
for the account of ____________________________________________________________.
_______________________________________________________________________________
Distributions made by check (such check to be made payable to
_______________________) and all applicable statements and notices should be
mailed to ___________________________________________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee
named above, or ______________, as its agent.
-10-
<PAGE>
CLASS H MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily mortgage loans (the "Mortgage
Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: ____% per annum H Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal
Agreement: Balance of this Class H Certificate
as of the Closing Date: $
Closing Date: Aggregate Stated Principal Balance
of the Mortgage Loans as of the
Closing Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer: CUSIP No.
GE Capital Realty Group, Inc.
Certificate No.
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F AND CLASS G CERTIFICATES OF THE
SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING,
WITHOUT LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR
SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT (a)
SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (i) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER
AND (b) SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH
TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF
THE CODE. AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS H
CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE
PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON
DESCRIBED IN CLAUSE (B) OF THE
-2-
<PAGE>
PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE FOLLOWING
INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE. THE ISSUE
DATE OF THIS CERTIFICATE IS JUNE 26, 1997. ASSUMING THAT THE MORTGAGE LOANS
PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF APPLYING
THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE PROSPECTUS
DATED JUNE 5, 1997 AND THE PROSPECTUS SUPPLEMENT DATED JUNE 20, 1997 RELATING TO
THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"), THIS $3,597,294 OF
INITIAL CERTIFICATE BALANCE AMOUNT, THE YIELD TO MATURITY IS ___% PER ANNUM, AND
THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN
$____________ PER $1,000 OF INITIAL CERTIFICATE NOTIONAL AMOUNT, COMPUTED UNDER
THE EXACT METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL PREPAY
AT A RATE BASED ON THE PREPAYMENT ASSUMPTION OR AT ANY OTHER RATE.
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1, CLASS A-2,
CLASS A-3, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F AND CLASS G CERTIFICATES
OF THE SAME SERIES IS REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF
THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS J CERTIFICATES OF THE
SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE
TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Merrill Lynch, Pierce, Fenner & Smith is the
registered owner of the Percentage Interest evidenced by this Class H
Certificate (obtained by dividing the principal amount of this Class H
Certificate (its "Certificate Principal Balance") as of the Closing Date by the
aggregate principal amount of all the Class H Certificates (their "Class
Principal Balance") as of the Closing Date) in that certain beneficial ownership
interest evidenced by all the Class H Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter called
the "Depositor", which term includes any successor entity under
-3-
<PAGE>
the Agreement), GE Capital Asset Management Corporation (in such capacity,
hereinafter called the "Master Servicer", which term includes any successor
entity under the Agreement), GE Capital Realty Group, Inc. (in such capacity,
hereinafter called the "Special Servicer", which term includes any successor
entity under the Agreement), General Electric Capital Corporation (or any
successor entity under the Agreement), ABN AMRO Bank N.V. (hereinafter called
the "Fiscal Agent", which term includes any successor entity under the
Agreement) and LaSalle National Bank (hereinafter called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class H Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on this Class H
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on
-4-
<PAGE>
which this Certificate is surrendered as contemplated by the preceding sentence,
will be made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class H Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class H
Certificates are exchangeable for new Class H Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class H Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class H Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor or any of its
affiliates), then the Certificate
-5-
<PAGE>
Registrar shall refuse to register such transfer unless it receives either: (i)
a certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel satisfactory to the Certificate Registrar to the
effect that such transfer may be made without registration under the Securities
Act (which Opinion of Counsel shall not be an expense of the Trust Fund or of
the Depositor, the Master Servicer, the Special Servicer, the Trustee or the
Certificate Registrar in their respective capacities as such), together with the
written certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class G Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class H Certificate without
registration or qualification. Any Class H Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class H Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class H Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class H
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, the Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or
-6-
<PAGE>
the Depositor at a price determined as provided in the Agreement of all Mortgage
Loans and each REO Property remaining in the Trust Fund. The Agreement permits,
but does not require, the Master Servicer or the Depositor to purchase from the
Trust Fund all Mortgage Loans and each REO Property remaining therein. The
exercise of such right will effect early retirement of the Class G Certificates;
however, such right to purchase is subject to the aggregate Stated Principal
Balance of the Mortgage Pool at the time of purchase being less than 1% of the
aggregate Stated Principal Balance of the Mortgage Loans as of the Closing Date
specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:_________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class H Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:_________________________________
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
___________________________________________________
___________________________________________________
___________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-9-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to__________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable
to_________________________ ) and all applicable statements and notices should
be mailed to __________________________________________________________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee
named above, or ______________, as its agent.
-10-
<PAGE>
CLASS J MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily mortgage loans (the "Mortgage
Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Initial Pass-Through Class Principal Balance of the Class
Rate: ____% per annum J Certificates as of the Closing
Date: $
Date of Pooling and Servicing Initial Certificate Principal
Agreement: Balance of this Class J Certificate
as of the Closing Date: $
Closing Date: Aggregate Stated Principal Balance
of the Mortgage Loans as of the
Closing Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer: CUSIP No.
GE Capital Realty Group, Inc.
Certificate No.
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., LASALLE NATIONAL BANK, GE CAPITAL ASSET
MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC CAPITAL
CORPORATION, ABN AMRO BANK N.V. OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER
THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, AND CLASS H
CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE ON BEHALF OF,
AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING,
WITHOUT LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR
SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT (a)
SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (i) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER
AND (b) SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH
TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF
THE CODE. AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS J
CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE
PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON
DESCRIBED IN CLAUSE (B) OF THE
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PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE. THE FOLLOWING
INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL
INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE. THE ISSUE
DATE OF THIS CERTIFICATE IS JUNE 26, 1997. ASSUMING THAT THE MORTGAGE LOANS
PREPAY AT AN ASSUMED RATE OF PREPAYMENT USED SOLELY FOR THE PURPOSES OF APPLYING
THE OID RULES TO THE CERTIFICATES EQUAL TO A CPR (AS DEFINED IN THE PROSPECTUS
DATED JUNE 5, 1997 AND THE PROSPECTUS SUPPLEMENT DATED JUNE 20, 1997 RELATING TO
THIS CERTIFICATE) OF 0% (THE "PREPAYMENT ASSUMPTION"), THIS $4,496,961 OF
INITIAL CERTIFICATE BALANCE AMOUNT, THE YIELD TO MATURITY IS ___% PER ANNUM, AND
THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN
$____________ PER $1,000 OF INITIAL CERTIFICATE NOTIONAL AMOUNT, COMPUTED UNDER
THE EXACT METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL PREPAY
AT A RATE BASED ON THE PREPAYMENT ASSUMPTION OR AT ANY OTHER RATE.
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1, CLASS A-2,
CLASS A-3, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, AND CLASS H
CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION
OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN
ADDITION, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED
BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING
CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ABOVE.
This certifies that Merrill Lynch, Pierce, Fenner & Smith is the
registered owner of the Percentage Interest evidenced by this Class J
Certificate (obtained by dividing the principal amount of this Class J
Certificate (its "Certificate Principal Balance") as of the Closing Date by the
aggregate principal amount of all the Class J Certificates (their "Class
Principal Balance") as of the Closing Date) in that certain beneficial ownership
interest evidenced by all the Class J Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter called
the "Depositor", which term includes any successor entity under the Agreement),
GE Capital Asset Management Corporation (in such capacity, hereinafter called
the "Master Servicer", which term
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includes any successor entity under the Agreement), GE Capital Realty Group,
Inc. (in such capacity, hereinafter called the "Special Servicer", which term
includes any successor entity under the Agreement), General Electric Capital
Corporation (or any successor entity under the Agreement), ABN AMRO Bank N.V.
(hereinafter called the "Fiscal Agent", which term includes any successor entity
under the Agreement) and LaSalle National Bank (hereinafter called the
"Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class J Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on this Class J
Certificate will be made by LaSalle National Bank, as paying agent (the "Paying
Agent"), by wire transfer of immediately available funds to the account of the
Person entitled thereto at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent distributions) or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Trustee or such other location specified in
the notice to the Holder hereof of such final distribution. Also notwithstanding
the foregoing, any distribution that may be made with respect to this
Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address
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of the Holder that surrenders this Certificate as such address last appears in
the Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class J Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class J
Certificates are exchangeable for new Class J Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class J Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class J Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor or any of its
affiliates), then the Certificate Registrar shall refuse to register such
transfer unless it receives either: (i) a certificate from the Certificateholder
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desiring to effect such transfer substantially in the form attached as Exhibit
G-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit G-2
or Exhibit G-3 to the Agreement; or (ii) an Opinion of Counsel satisfactory to
the Certificate Registrar to the effect that such transfer may be made without
registration under the Securities Act (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Master Servicer, the Special
Servicer, the Trustee or the Certificate Registrar in their respective
capacities as such), together with the written certification(s) as to the facts
surrounding such transfer from the Certificateholder desiring to effect such
transfer and/or such Certificateholder's prospective transferee on which such
Opinion of Counsel is based. None of the Depositor, the Trustee or the
Certificate Registrar is obligated to register or qualify the Class J
Certificates under the Securities Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of any
Class J Certificate without registration or qualification. Any Class J
Certificateholder desiring to effect such a transfer shall, and by the
acceptance of its Class J Certificate agrees to, indemnify the Trustee, the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class J Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class J
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent and the Certificate Registrar and
any agent of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the Person in
whose name this Certificate is registered as the owner hereof for all purposes,
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Fiscal Agent, the Paying Agent, the Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the
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Trust Fund. The Agreement permits, but does not require, the Master Servicer or
the Depositor to purchase from the Trust Fund all Mortgage Loans and each REO
Property remaining therein. The exercise of such right will effect early
retirement of the Class J Certificates; however, such right to purchase is
subject to the aggregate Stated Principal Balance of the Mortgage Pool at the
time of purchase being less than 1% of the aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and the Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and the
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class J Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
____________________________________________________
____________________________________________________
____________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:_____________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to__________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable
to_________________________________ ) and all applicable statements and notices
should be mailed to ___________________________________________________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee
named above, or ______________, as its agent.
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<PAGE>
CLASS R-I MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Date of Pooling and Servicing Percentage Interest evidenced by
Agreement: this Class R-I Certificate: 100%
Closing Date: Aggregate Stated Principal Balance
of the Mortgage Loans as of the
Closing Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No.
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<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., STATE STREET BANK AND CALIFORNIA, GE CAPITAL
ASSET MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC
CAPITAL CORPORATION, THE FISCAL AGENT OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, AND CLASS J
CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 THE ("SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH
INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN). AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F CERTIFICATE,
THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE PROSPECTIVE
TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN
CLAUSE (B) OF THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT
SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUEMTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH
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TRANSFER RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE
OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE.
This certifies that Merrill Lynch, Pierce, Fenner & Smith is the
registered owner of the Percentage Interest evidenced by this Class R-I
Certificate (as specified above) in that certain beneficial ownership interest
evidenced by all the Class R-I Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter called
the "Depositor", which term includes any successor entity under the Agreement),
GE Capital Asset Management Corporation (in such capacity, hereinafter called
the "Master Servicer", which term includes any successor entity under the
Agreement), GE Capital Realty Group, Inc. in such capacity, hereinafter called
the "Special Servicer", which term includes any successor entity under the
Agreement), General Electric Capital Corporation (or any successor entity under
the Agreement), ABN AMRO Bank N.V. (hereinafter called the "Fiscal Agent", which
term includes any successor entity under the Agreement) and LaSalle National
Bank (hereinafter called the "Trustee", which term includes any successor entity
under the Agreement), a summary of certain of the pertinent provisions of which
is set forth hereafter. To the extent not defined herein, the capitalized terms
used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount, if any, required to be distributed to the
Holders of the Class R-I Certificates on the applicable Distribution Date
pursuant to the Agreement. All distributions made under the Agreement on this
Class R-I Certificate will be made by check mailed to the address of the Person
entitled thereto, as such name and address appear in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate will
be made in like manner, but only upon
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presentation and surrender of this Certificate at the offices of the Trustee or
such other location specified in the notice to Certificateholders of such final
distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class R-I Certificates are issuable in fully registered form
only without coupons in minimum denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Class R-I Certificates are exchangeable for new
Class R-I Certificates in authorized denominations evidencing the same aggregate
Percentage Interest, as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class R-I Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class R-I Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If a transfer of any R-I Certificate is to be
made without registration under the Securities Act (other than in connection
with the initial issuance thereof or the initial transfer thereof by the
Depositor or any of its affiliates), then the Certificate Registrar shall refuse
to register such transfer unless it receives either: (i) a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit G-1 to the Agreement, and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
either Exhibit G-2 or Exhibit G-3 to the Agreement; or (ii) an
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Opinion of Counsel satisfactory to the Certificate Registrar to the effect that
such transfer may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Trust Fund or of the
Depositor, the Master Servicer, the Special Servicer, the Trustee or the
Certificate Registrar in their respective capacities as such), together with the
written certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class R-I Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class R-I Certificate without
registration or qualification. Any Class R-I Certificateholder desiring to
effect such a transfer shall, and by the acceptance of its Class R-I Certificate
agrees to, indemnify the Trustee, the Certificate Registrar and the Depositor
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.
No transfer of a Class R-I Certificate or any interest therein shall
be made to (A) a Plan or (B) any Person who is directly or indirectly purchasing
the Class R-1 Certificate or interest therein on behalf of, as named fiduciary
of, as trustee of, or with assets of a Plan (including, without limitation, any
insurance company using assets in its general or separate account that may
constitute assets of a Plan). As a condition to its registration of transfer of
a Class R-1 Certificate, the Certificate Registrar shall have the right to
require the prospective transferee of such Certificate, if it is not a Plan or
Person described in clause (B) of the preceding sentence, to execute a
certification to that effect substantially in the form of Exhibit H to the
Agreement.
Each Person who has or who acquires any Ownership Interest in this
Certificate shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of Section 5.02(d) of the
Agreement and, if any purported Transferee shall become a Holder of this
Certificate in violation of the provisions of such Section 5.02(d), to have
irrevocably authorized LaSalle National Bank, as paying agent (the "Paying
Agent"), under clause (ii)(A) of such Section 5.02(d) to deliver payments to a
Person other than such Person and to have irrevocably authorized the Certificate
Registrar under clause (ii)(B) of such Section 5.02(d) to negotiate the terms of
any mandatory sale and to execute all instruments of Transfer and to do all
other things necessary in connection with any such sale. Each Person holding or
acquiring any Ownership Interest in this Certificate must be a Permitted
Transferee and shall promptly notify the Master Servicer, the Paying Agent and
the Certificate Registrar of any change or impending change in
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its status as a Permitted Transferee. In connection with any proposed Transfer
of any Ownership Interest in this Certificate, the Certificate Registrar shall
require delivery to it, and shall not register the Transfer of this Certificate
until its receipt of, an affidavit and agreement substantially in the form
attached as Exhibit I-1 to the Agreement (a "Transfer Affidavit and Agreement")
from the proposed Transferee, in form and substance satisfactory to the
Certificate Registrar, representing and warranting, among other things, that
such Transferee is a Permitted Transferee, that it is not acquiring its
Ownership Interest in this Certificate as a nominee, trustee or agent for any
Person that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in this Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of Section 5.02(d) of the
Agreement and agrees to be bound by them. Notwithstanding the delivery of a
Transfer Affidavit and Agreement by a proposed Transferee, if a Responsible
Officer of the Certificate Registrar has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in this Certificate to such proposed Transferee shall be effected.
Each Person holding or acquiring any Ownership Interest in this
Certificate shall agree (x) to require a Transfer Affidavit and Agreement from
any other Person to whom such Person attempts to transfer its Ownership Interest
herein and (y) not to transfer its Ownership Interest unless it provides to the
Certificate Registrar a certificate substantially in the form attached as
Exhibit I-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring such Ownership Interest, if it is, or is holding such Ownership
Interest on behalf of, a "pass-through interest holder".
The provisions of Section 5.02(d) of the Agreement may be modified,
added to or eliminated, provided that there shall have been delivered to the
Certificate Registrar and the Master Servicer the following: (a) written
confirmation from each Rating Agency to the effect that the modification of,
addition to or elimination of such provisions will not cause such Rating Agency
to downgrade its then-current ratings of any Class of Certificates; and (b) an
Opinion of Counsel, in form and substance satisfactory to the Certificate
Registrar and the Master Servicer, to the effect that such modification of,
addition to or elimination of such provisions will not cause the Trust Fund to
(x) cease to qualify as a REMIC or (y) be subject to an entity-level tax caused
by the Transfer of any Class R-I Certificate to a Person which is not a
Permitted Transferee, or
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<PAGE>
cause a Person other than the prospective Transferee to be subject to a
REMIC-related tax caused by the Transfer of a Class R-I Certificate to a Person
which is not a Permitted Transferee.
A "Permitted Transferee" is any Transferee other than a
"Disqualified Organization" or a "Non-United States Person". A "Disqualified
Organization" is any of (i) the United States, any State or political
subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing (other than an instrumentality which is
a corporation if all of its activities are subject to tax and, except for the
FHLMC, a majority of its board of directors is not selected by such governmental
unit), (ii) a foreign government, any international organization, or any agency
or instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter I of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381 of the Code and
(v) any other Person so designated by the Trustee based upon an Opinion of
Counsel provided to it that the holding of an Ownership Interest in a Class R-I
Certificate by such Person may cause the Trust Fund or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class
R-I Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
A "Non-United States Person" is any Person other than a United
States Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, or an
estate or trust whose income from sources without the United States is income
for United States federal income tax purposes regardless of its connection of a
trade or business within the United States.
No service charge will be imposed for any registration of transfer
or exchange of Class R-I Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class R-I
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, Fiscal Agent, the Paying Agent and the Certificate Registrar and any
agent of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent or
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<PAGE>
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Special Servicer, the Trustee, Fiscal Agent, the Paying
Agent, the Certificate Registrar or any such agent shall be affected by notice
to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the Master Servicer or the Depositor to purchase from the Trust Fund
all Mortgage Loans and each REO Property remaining therein. The exercise of such
right will effect early retirement of the Certificates; however, such right to
purchase is subject to the aggregate Stated Principal Balance of the Mortgage
Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-I Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:_______________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall be made by check payable to____________________
_______________________________________________________________________________
and mailed to__________________________________________________________________
Applicable statements and notices should be mailed to _____________
_______________________________________________________________________________.
This information is provided by ___________________________________,
the Assignee named above, or ______________, as its agent.
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<PAGE>
CLASS R-II MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Date of Pooling and Servicing Percentage Interest evidenced by
Agreement: this Class R-II Certificate: 100%
Closing Date: Aggregate Stated Principal Balance
of the Mortgage Loans as of the
Closing Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No.
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<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., STATE STREET BANK AND CALIFORNIA, GE CAPITAL
ASSET MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC
CAPITAL CORPORATION, THE FISCAL AGENT OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, AND CLASS J
CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH
INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN). AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F CERTIFICATE,
THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE PROSPECTIVE
TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN
CLAUSE (B) OF THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT
SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH
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<PAGE>
TRANSFER RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE
OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE.
This certifies that Merrill Lynch, Pierce, Fenner & Smith is the
registered owner of the Percentage Interest evidenced by this Class R-II
Certificate (obtained by dividing the principal amount of this Class R-II
Certificate (as specified above) in that certain beneficial ownership interest
evidenced by all the Class R-II Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter called
the "Depositor", which term includes any successor entity under the Agreement),
GE Capital Asset Management Corporation (in such capacity, hereinafter called
the "Master Servicer", which term includes any successor entity under the
Agreement), GE Capital Realty Group, Inc. (in such capacity, hereinafter called
the "Special Servicer", which term includes any successor entity under the
Agreement), General Electric Capital Corporation (or any successor entity under
the Agreement), ABN AMRO Bank N.V. (hereinafter called the "Fiscal Agent", which
term includes any successor entity under the Agreement) and LaSalle National
Bank (hereinafter called the "Trustee", which term includes any successor entity
under the Agreement), a summary of certain of the pertinent provisions of which
is set forth hereafter. To the extent not defined herein, the capitalized terms
used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount, if any, required to be distributed to the
Holders of this Class R-II Certificate on the applicable Distribution Date
pursuant to the Agreement. All distributions made under the Agreement on this
Class R-II Certificate will be made by check mailed to the address of the Person
entitled thereto, as such name and address appear in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this
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<PAGE>
Certificate will be made in like manner, but only upon presentation and
surrender of this Certificate at the offices of the Trustee or such other
location specified in the notice to Certificateholders of such final
distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class R-II Certificates are issuable in fully registered form
only without coupons in minimum denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Class R-II Certificates are exchangeable for new
Class R-II Certificates in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class R-II Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class R-II Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor or any of its
affiliates), then the Certificate Registrar shall refuse to register such
transfer unless it receives either: (i) a certificate from the Certificateholder
desiring to effect such transfer substantially in the form attached as Exhibit
G-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit G-2
or Exhibit G-3 to the Agreement; or (ii) an Opinion of Counsel satisfactory to
the
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<PAGE>
Certificate Registrar to the effect that such transfer may be made without
registration under the Securities Act (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Master Servicer, the Special
Servicer, the Trustee or the Certificate Registrar in their respective
capacities as such), together with the written certification(s) as to the facts
surrounding such transfer from the Certificateholder desiring to effect such
transfer and/or such Certificateholder's prospective transferee on which such
Opinion of Counsel is based. None of the Depositor, the Trustee or the
Certificate Registrar is obligated to register or qualify the Class R-II
Certificates under the Securities Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of any
Class R-II Certificate without registration or qualification. Any Class R-II
Certificateholder desiring to effect such a transfer shall, and by the
acceptance of its Class R-II Certificate agrees to, indemnify the Trustee, the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of a Class R-II Certificate or any interest therein
shall be made to (A) a Plan or (B) any Person who is directly or indirectly
purchasing the Class R-II Certificate or interest therein on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan (including, without
rotation, any insurance company using assets in its general or separate account
that may constitute assets of a Plan). As a condition to its registration of
transfer of a Class R-II Certificate, the Certificate Registrar shall have the
right to require the prospective transferee of such Certificate, if it is not a
Plan or Person described in clause (B) of the preceding sentence, to execute a
certification to that effect substantially in the form of Exhibit H to the
Agreement.
Each Person who has or who acquires any Ownership Interest in this
Certificate shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of Section 5.02(d) of the
Agreement and, if any purported Transferee shall become a Holder of this
Certificate in violation of the provisions of such Section 5.02(d), to have
irrevocably authorized LaSalle National Bank, as paying agent (the "Paying
Agent"), under clause (ii)(A) of such Section 5.02(d) to deliver payments to a
Person other than such Person and to have irrevocably authorized the Certificate
Registrar under clause (ii)(B) of such Section 5.02(d) to negotiate the terms of
any mandatory sale and to execute all instruments of Transfer and to do all
other things necessary in connection with any such sale. Each Person holding or
acquiring any Ownership Interest in this Certificate must be a Permitted
Transferee and shall promptly notify the Master Servicer, the Paying Agent and
the Certificate Registrar of any change or impending change in its status as a
Permitted Transferee. In connection with any
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<PAGE>
proposed Transfer of any Ownership Interest in this Certificate, the Certificate
Registrar shall require delivery to it, and shall not register the Transfer of
this Certificate until its receipt of, an affidavit and agreement substantially
in the form attached as Exhibit I-1 to the Agreement (a "Transfer Affidavit and
Agreement") from the proposed Transferee, in form and substance satisfactory to
the Certificate Registrar, representing and warranting, among other things, that
such Transferee is a Permitted Transferee, that it is not acquiring its
Ownership Interest in this Certificate as a nominee, trustee or agent for any
Person that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in this Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of Section 5.02(d) of the
Agreement and agrees to be bound by them. Notwithstanding the delivery of a
Transfer Affidavit and Agreement by a proposed Transferee, if a Responsible
Officer of the Certificate Registrar has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in this Certificate to such proposed Transferee shall be effected.
Each Person holding or acquiring any Ownership Interest in this
Certificate shall agree (x) to require a Transfer Affidavit and Agreement from
any other Person to whom such Person attempts to transfer its Ownership Interest
herein and (y) not to transfer its Ownership Interest unless it provides to the
Certificate Registrar a certificate substantially in the form attached as
Exhibit I-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring such Ownership Interest, if it is, or is holding such Ownership
Interest on behalf of, a "pass-through interest holder".
The provisions of Section 5.02(d) of the Agreement may be modified,
added to or eliminated, provided that there shall have been delivered to the
Certificate Registrar and the Master Servicer the following: (a) written
confirmation from each Rating Agency to the effect that the modification of,
addition to or elimination of such provisions will not cause such Rating Agency
to downgrade its then-current ratings of any Class of Certificates; and (b) an
Opinion of Counsel, in form and substance satisfactory to the Certificate
Registrar and the Master Servicer, to the effect that such modification of,
addition to or elimination of such provisions will not cause the Trust Fund to
(x) cease to qualify as a REMIC or (y) be subject to an entity-level tax caused
by the Transfer of any Class R-II Certificate to a Person which is not a
Permitted Transferee, or cause a Person other than the prospective Transferee to
be
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<PAGE>
subject to a REMIC-related tax caused by the Transfer of a Class R-II
Certificate to a Person which is not a Permitted Transferee.
A "Permitted Transferee" is any Transferee other than a
"Disqualified Organization" or a "Non-United States Person". A "Disqualified
Organization" is any of (i) the United States, any State or political
subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing (other than an instrumentality which is
a corporation if all of its activities are subject to tax and, except for the
FHLMC, a majority of its board of directors is not selected by such governmental
unit), (ii) a foreign government, any international organization, or any agency
or instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter I of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381 of the Code and
(v) any other Person so designated by the Trustee based upon an Opinion of
Counsel provided to it that the holding of an Ownership Interest in a Class R-II
Certificate by such Person may cause the Trust Fund or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class
R-II Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
A "Non-United States Person" is any Person other than a United
States Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, or an
estate or trust whose income from sources without the United States is income
for United States federal income tax purposes regardless of its connection of a
trade or business within the United States.
No service charge will be imposed for any registration of transfer
or exchange of Class R-II Certificates, but the Certificate Registrar may
require payment of a but sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
R-II Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, Fiscal Agent, the Paying Agent and the Certificate Registrar and any
agent of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent or the Certificate Registrar may treat the Person in whose name
this
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<PAGE>
Certificate is registered as the owner hereof for all purposes, and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, Fiscal Agent,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the Master Servicer or the Depositor to purchase from the Trust Fund
all Mortgage Loans and each REO Property remaining therein. The exercise of such
right will effect early retirement of the Certificates; however, such right to
purchase is subject to the aggregate Stated Principal Balance of the Mortgage
Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and Fiscal
Agent, and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
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<PAGE>
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-II Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-11-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall be by check made payable to____________________
_______________________________________________________________________________
and mailed to_________________________________________________________________.
Applicable statements and notices should be mailed to _____________
_______________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee
named above, or ______________, as its agent.
-12-
<PAGE>
CLASS R-III MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1997-C1
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Date of Pooling and Servicing Percentage Interest evidenced by
Agreement: this Class R-III Certificate: 100%
Closing Date: Aggregate Stated Principal Balance
of the Mortgage Loans as of the
Closing Date: $
First Distribution Date:
Master Servicer: Trustee:
GE Capital Asset Management Corporation LaSalle National Bank
Special Servicer:
GE Capital Realty Group, Inc.
Certificate No.
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN MERRILL
LYNCH MORTGAGE INVESTORS, INC., STATE STREET BANK AND CALIFORNIA, GE CAPITAL
ASSET MANAGEMENT CORPORATION, GE CAPITAL REALTY GROUP, INC., GENERAL ELECTRIC
CAPITAL CORPORATION, THE FISCAL AGENT OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS A-3, CLASS
IO, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, AND CLASS J
CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE PROHIBITED TRANSACTIONS RESTRICTIONS OF
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY
PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH
INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN). AS A CONDITION TO THIS REGISTRATION OF TRANSFER OF A CLASS F CERTIFICATE,
THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE PROSPECTIVE
TRANSFEREE OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN
CLAUSE (B) OF THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT
SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO THE AGREEMENT.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH
-2-
<PAGE>
TRANSFER RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE
OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE.
This certifies that Merrill Lynch, Pierce, Fenner & Smith is the
registered owner of the Percentage Interest evidenced by this Class R-III
Certificate (obtained by dividing the principal amount of this Class R-III
Certificate (as specified above) in that certain beneficial ownership interest
evidenced by all the Class R-III Certificates in the Trust Fund created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Merrill Lynch Mortgage Investors, Inc. (hereinafter called
the "Depositor", which term includes any successor entity under the Agreement),
GE Capital Asset Management Corporation (in such capacity, hereinafter called
the "Master Servicer", which term includes any successor entity under the
Agreement), GE Capital Realty Group, Inc. (in such capacity, hereinafter called
the "Special Servicer", which term includes any successor entity under the
Agreement), General Electric Capital Corporation (or any successor entity under
the Agreement), ABN AMRO Bank N.V. (hereinafter called the "Fiscal Agent", which
term includes any successor entity under the Agreement) and LaSalle National
Bank (hereinafter called the "Trustee", which term includes any successor entity
under the Agreement), a summary of certain of the pertinent provisions of which
is set forth hereafter. To the extent not defined herein, the capitalized terms
used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount, if any, required to be distributed to the
Holders of this Class R-III Certificate on the applicable Distribution Date
pursuant to the Agreement. All distributions made under the Agreement on this
Class R-III Certificate will be made by check mailed to the address of the
Person entitled thereto, as such name and address appear in the Certificate
Register. Notwithstanding the foregoing, the final distribution on this
-3-
<PAGE>
Certificate will be made in like manner, but only upon presentation and
surrender of this Certificate at the offices of the Trustee or such other
location specified in the notice to Certificateholders of such final
distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class R-III Certificates are issuable in fully registered form
only without coupons in minimum denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Class R-III Certificates are exchangeable for new
Class R-III Certificates in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class R-II Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class R-III Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor or any of its
affiliates), then the Certificate Registrar shall refuse to register such
transfer unless it receives either: (i) a certificate from the Certificateholder
desiring to effect such transfer substantially in the form attached as Exhibit
G-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit G-2
or Exhibit G-3 to the Agreement; or (ii) an Opinion of Counsel satisfactory to
the
-4-
<PAGE>
Certificate Registrar to the effect that such transfer may be made without
registration under the Securities Act (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Master Servicer, the Special
Servicer, the Trustee or the Certificate Registrar in their respective
capacities as such), together with the written certification(s) as to the facts
surrounding such transfer from the Certificateholder desiring to effect such
transfer and/or such Certificateholder's prospective transferee on which such
Opinion of Counsel is based. None of the Depositor, the Trustee or the
Certificate Registrar is obligated to register or qualify the Class R-III
Certificates under the Securities Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of any
Class R-III Certificate without registration or qualification. Any Class R-III
Certificateholder desiring to effect such a transfer shall, and by the
acceptance of its Class R-II Certificate agrees to, indemnify the Trustee, the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of a Class R-III Certificate or any interest therein
shall be made to (A) a Plan or (B) any Person who is directly or indirectly
purchasing the Class R-III Certificate or interest therein on behalf of, as
named fiduciary of, as trustee of, or with assets of a Plan (including, without
rotation, any insurance company using assets in its general or separate account
that may constitute assets of a Plan). As a condition to its registration of
transfer of a Class R-III Certificate, the Certificate Registrar shall have the
right to require the prospective transferee of such Certificate, if it is not a
Plan or Person described in clause (B) of the preceding sentence, to execute a
certification to that effect substantially in the form of Exhibit H to the
Agreement.
Each Person who has or who acquires any Ownership Interest in this
Certificate shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of Section 5.02(d) of the
Agreement and, if any purported Transferee shall become a Holder of this
Certificate in violation of the provisions of such Section 5.02(d), to have
irrevocably authorized GE Capital Asset Management Corporation, N.A., as paying
agent (the "Paying Agent"), under clause (ii)(A) of such Section 5.02(d) to
deliver payments to a Person other than such Person and to have irrevocably
authorized the Certificate Registrar under clause (ii)(B) of such Section
5.02(d) to negotiate the terms of any mandatory sale and to execute all
instruments of Transfer and to do all other things necessary in connection with
any such sale. Each Person holding or acquiring any Ownership Interest in this
Certificate must be a Permitted Transferee and shall promptly notify the Master
Servicer, the Paying Agent and the Certificate Registrar of any change or
impending change in its status as a Permitted
-5-
<PAGE>
Transferee. In connection with any proposed Transfer of any Ownership Interest
in this Certificate, the Certificate Registrar shall require delivery to it, and
shall not register the Transfer of this Certificate until its receipt of, an
affidavit and agreement substantially in the form attached as Exhibit I-1 to the
Agreement (a "Transfer Affidavit and Agreement") from the proposed Transferee,
in form and substance satisfactory to the Certificate Registrar, representing
and warranting, among other things, that such Transferee is a Permitted
Transferee, that it is not acquiring its Ownership Interest in this Certificate
as a nominee, trustee or agent for any Person that is not a Permitted
Transferee, that for so long as it retains its Ownership Interest in this
Certificate, it will endeavor to remain a Permitted Transferee, and that it has
reviewed the provisions of Section 5.02(d) of the Agreement and agrees to be
bound by them. Notwithstanding the delivery of a Transfer Affidavit and
Agreement by a proposed Transferee, if a Responsible Officer of the Certificate
Registrar has actual knowledge that the proposed Transferee is not a Permitted
Transferee, no Transfer of an Ownership Interest in this Certificate to such
proposed Transferee shall be effected.
Each Person holding or acquiring any Ownership Interest in this
Certificate shall agree (x) to require a Transfer Affidavit and Agreement from
any other Person to whom such Person attempts to transfer its Ownership Interest
herein and (y) not to transfer its Ownership Interest unless it provides to the
Certificate Registrar a certificate substantially in the form attached as
Exhibit I-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring such Ownership Interest, if it is, or is holding such Ownership
Interest on behalf of, a "pass-through interest holder".
The provisions of Section 5.02(d) of the Agreement may be modified,
added to or eliminated, provided that there shall have been delivered to the
Certificate Registrar and the Master Servicer the following: (a) written
confirmation from each Rating Agency to the effect that the modification of,
addition to or elimination of such provisions will not cause such Rating Agency
to downgrade its then-current ratings of any Class of Certificates; and (b) an
Opinion of Counsel, in form and substance satisfactory to the Certificate
Registrar and the Master Servicer, to the effect that such modification of,
addition to or elimination of such provisions will not cause the Trust Fund to
(x) cease to qualify as a REMIC or (y) be subject to an entity-level tax caused
by the Transfer of any Class R-II Certificate to a Person which is not a
Permitted Transferee, or
-6-
<PAGE>
cause a Person other than the prospective Transferee to be subject to a
REMIC-related tax caused by the Transfer of a Class R-1I Certificate to a Person
which is not a Permitted Transferee.
A "Permitted Transferee" is any Transferee other than a
"Disqualified Organization" or a "Non-United States Person". A "Disqualified
Organization" is any of (i) the United States, any State or political
subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing (other than an instrumentality which is
a corporation if all of its activities are subject to tax and, except for the
FHLMC, a majority of its board of directors is not selected by such governmental
unit), (ii) a foreign government, any international organization, or any agency
or instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter I of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381 of the Code and
(v) any other Person so designated by the Trustee based upon an Opinion of
Counsel provided to it that the holding of an Ownership Interest in a Class
R-III Certificate by such Person may cause the Trust Fund or any Person having
an Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class
R-III Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
A "Non-United States Person" is any Person other than a United
States Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, or an
estate or trust whose income from sources without the United States is income
for United States federal income tax purposes regardless of its connection of a
trade or business within the United States.
No service charge will be imposed for any registration of transfer
or exchange of Class R-III Certificates, but the Certificate Registrar may
require payment of a but sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
R-III Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, Fiscal Agent, the Paying Agent and the Certificate Registrar and any
agent of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent or
-7-
<PAGE>
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Special Servicer, the Trustee, Fiscal Agent, the Paying
Agent, the Certificate Registrar or any such agent shall be affected by notice
to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier of (i) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Master Servicer or the Depositor at a
price determined as provided in the Agreement of all Mortgage Loans and each REO
Property remaining in the Trust Fund. The Agreement permits, but does not
require, the Master Servicer or the Depositor to purchase from the Trust Fund
all Mortgage Loans and each REO Property remaining therein. The exercise of such
right will effect early retirement of the Certificates; however, such right to
purchase is subject to the aggregate Stated Principal Balance of the Mortgage
Pool at the time of purchase being less than 1% of the aggregate Stated
Principal Balance of the Mortgage Loans as of the Closing Date specified on the
face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer, the Trustee and Fiscal
Agent and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Master Servicer, the Special Servicer, the Trustee and
Fiscal Agent with the consent of the Holders of Certificates entitled to at
least 51% of the Voting Rights allocated to the affected Classes. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, including any amendment necessary to maintain the status of the
Trust Fund (or designated portions thereof) as a REMIC, without the consent of
the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
-8-
<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-9-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated:
LASALLE NATIONAL BANK,
as Certificate Registrar
By:___________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-III Certificates referred to in the
within-mentioned Agreement.
LASALLE NATIONAL BANK,
as Authenticating Agent
By:___________________________________
Authorized Officer
-10-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new
Mortgage Pass-Through Certificate of a like Percentage Interest and Class to the
above named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
_______________________________________________________________________________
_______________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-11-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall be by check made payable to____________________
_______________________________________________________________________________
and mailed to_________________________________________________________________.
Applicable statements and notices should be mailed to _____________
_______________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ______________________, the Assignee
named above, or ______________, as its agent.
-12-
<PAGE>
<TABLE>
EXHIBIT B
MLMI 1997-C1
MORTGAGE LOAN SCHEDULE
<CAPTION>
Control
Number Property Name Address City State Zip Code
- ------ ------------- ------- ---- ----- --------
<S> <C> <C> <C> <C> <C>
1 INT - The Crescent City Apartments 8501 Broadway Street Houston TX 77061
2 INT - The Park Apartments 4040 Schannen Boulevard Corpus Christi TX 78413
3 PP-Days Inn-Cody 524 Yellowstone Cody WY 82414
4 Days Inn-Norfolk 1001 Omaha Norfolk NE 68701
5 Towne Center Apartments 65 East Olive Gilbert AZ 85234
6 Ramada Limited - Austin 9102 Burnett Road Austin TX 78758
7 Sunrise Commons Apartments 8123 Sunrise Boulevard Citrus Heights CA 95610
8 IRM-Meadow Lakes Apartments 1401 Lakewood Ave Modesto CA 95354
9 Diablo View Apartments 4265 Clayton Road Concord CA 94521
10 IRM-Glenbrook Apartments 8725 La Riviera Drive Sacramento CA 95826
11 Casa Del Sol Apartments 14250 Borego Road Victorville CA 92392
12 Rush Creek Apartments 2625 Community Drive Dallas TX 75220
13 Northaven Apartments 11457 Dennis Road Dallas TX 75229
14 Salvio Pacheco Square 2151 Salvio Concord CA 94520
15 Roosevelt Center 2800-2820 Roosevelt Street Carlsbad CA 92008
16 Eastgate Square Shopping Center 164 U.S. Highway 17 East Palatka FL 32131
17 Lochwood Apartments 11117 Lochwood Boulevard Dallas TX 75218
18 Southpoint Apartments 4002 E. Southern Ave. Phoenix AZ 85040
19 MacArthur Crossing 7750 North MacArthur Blvd. Irving TX 75063
20 Carondelet Building 7710-7730 Carondelet Avenue Clayton MO 63105
21 Guild Building 7912 Bonhomme Ave. St. Louis MO 63105
22 Lease-All Orangethorpe 920-980 E. Orangethorpe Ave. Anaheim CA 92801
23 Lease-All Anaheim 1550-1600 South Anaheim Blvd. Anaheim CA 92805
24 Westlake Business Center 31200 - 31220 La Baya Drive Westlake Village CA 91361
25 Oregon Building 494 State Street Salem OR 97301
26 Riverview Apartments 2111 West 17th Street Santa Ana CA 92706
27 Walnut Woods Apartments 275 E. Minnesota Avenue Turlock CA 95832
28 Creekside Gardens Apartments 300 Bel Air Drive Vacaville CA 95687
29 Willowbrook Business Park 11515 - 11555 SW Durham Road Tigard OR 97223
30 Callens Corner Phase II 18637-18729 Brookhurst Street Fountain Valley CA 92708
31 Driftwood Apartments 800 West Grant Line Road Tracy CA 95376
32 Lincoln Village Apartments 2211 W. Campbell Avenue Phoenix AZ 85015
33 Country Glen Apartments 7575 Power Inn Road Sacramento CA 95828
34 Mountain Park Apartments 1350-1421 Custer Avenue Atlanta GA 30316
35 Foxworth Apartments 4789 Manzanita Avenue Carmichael CA 95608
36 New Peachtree Apartments 3354 Burk Drive Chamblee GA 30341
37 Ashdale Garden Apartments 2450 Ashdale Drive Austin TX 78757
38 Western Apartments 411 North Avenue Trinidad CO 81082
39 The Highlands Apartments 11201 Lake Highlands Drive Dallas TX 75218
40 10 Corporate Park 10 Corporate Park Irvine CA 92714
41 SCO Training Facility 400 Encinal Street Santa Cruz CA 95060
42 McCallum Meadows Apts. 7760 McCallum Blvd. Dallas TX 75252
43 Shilo Inn-Bend 3105 O.B. Riley Road Bend OR 97701
44 Shilo Inn-Coeur d'Alene 702 W. Appleway Coeur d'Alene ID 83814
45 Shilo Inn-Nampa 1401 Shilo Drive Nampa ID 83687
46 Plaza Las Palmas West Valley Parkway Escondido CA 92029
47 Shilo Inn-Tillamook 2515 N. Main Tillamook OR 97141-9246
48 Shilo Inn-Salt Lake City 206 South West Temple Salt Lake City UT 84101
49 Shilo Inn-Elko 2401 Mountain City Highway Elko NV 89801
50 Crosspointe Plaza 799 New Haven Road Naugatuck CT 06770
51 Back Bay Court 3601 Jamboree Road Newport Beach CA 92660
52 Park Central 7901-7963 Central Ave. Capitol Heights MD 20743
53 Lindberg Station 711 Morosgo Drive, N.E. Atlanta GA 30324
54 Westway Business Plaza 8000 Harwin Drive Houston TX 77036
55 Hastings Ranch Plaza 3801-3883 E. Foothill Bl. Pasadena CA 91107
56 Pirani Best Western - Airport Executel 20717 Pacific Highway South Seattle WA 98198
57 Best Western - Federal Way Executel 31611 20th Avenue South Federal Way WA 98003
58 Blue Mountain View Apartments 150 South Wilbur Walla Walla WA 99362
59 Ramada Inn 5526 North Interstate 35 North Austin TX 78751
60 Waterford Marketplace 503-555 Capital Expressway San Jose CA 95136
61 Union Square Shopping Center Union Deposit Road Harrisburg PA 17109
62 Club Secane Apartments 100 Oak Lane Darby Township PA 19036
63 Bryton Hill Manor Apartments 519 South Richey Pasadena TX 77506
64 Greeley Super 8 Motel 2423 West 29th Street Greeley CO 80631
65 Meridian Executive Center 815 NW 57th Avenue Miami FL 33026
66 North View Business Center 4665 North Avenue Oceanside CA 92056
67 Palisades Business Park Summit Avenue Plano TX 75074
68 Maple Leaf Building 23 East Street Cambridge MA 02141
69 Centlivre Village Apartments 2903 Westbrook Drive Ft. Wayne IN 46805
70 Pinewood Place Mobile Home Park 8539 Monterey Pine Place Tomball TX 77375
71 Southbrooke Manor 1105 West Main Street Edna (Victoria) TX 77957
72 Hampton Inn-Anderson 120 Interstate Boulevard Anderson SC 29621
73 Creekview Apartments 151 Little Creek Road Cedar Hill TX 75104
74 The Marketplace in University City 3202-3368 Governor Drive San Diego CA 92122
75 Greenview Apartments 7141 North 16th Street Phoenix AZ 85020
76 Whitemarsh Shopping Center Ridge Pike & Butler Pike Montgomery County PA 19428
77 Hampton Inn - Houston 20035 N.W. Freeway Houston TX 77065
78 Holiday Inn Express 1610 W. Nugent Avenue Temple TX 76504
79 Telstar Apartments 510 Westmount Dallas TX 75211
80 Mill Run Apartments 2732 W. Colorado Dallas TX 75211
81 Aldrich Plaza Route #9 Howell Township NJ 07731
82 Ho Jo Inn - Wilmington 3901 Market Street Wilmington NC 28403
83 Springwood Apartments 410 Sulphur Springs Road Greenville SC 29617
84 Woodley Downs Apartments 3923 Wodley Road Montgomery AL 36116
85 Rowland Heights Shopping Ctr NWC of Nogales & Pomona Fwy Rowland Heights CA 91748
86 Goose Creek Plaza S. C. 6900 Garth Road Baytown TX 77521
87 Oaks of Arlington Apartments 2100 Ascension Arlington TX 76006
88 Quail Meadows Apartments 10201 Telephone Road Houston TX 77471
89 Sherwood Court Apartments 4503-4531 McPherson Ave. St Louis MO 63108
90 Three Fountains Apartments 2400 Buffalo Gap Rd Abilene TX 79605
91 Avenel Blockbuster 1392 Route 35 North Woodbridge NJ 07001
92 St. Augustine Beach Holiday Inn 860 State Road A1A St. Augustine Beach FL 32084
93 Barkwood Apartments 5050 Yale Houston TX 77018
94 Wing Ong Plaza Thomas Road Phoenix AZ 85006
95 Parkside Aparments 325 W. 5th Avenue Mesa AZ 85201
96 Ridgeway Village Apartments 6033 W. Bethany Home Rd. Glendale AZ 85301
97 The Trails Apartments - Multifamily 3109 Chapel Creek Drive Dallas TX 75220
98 Crestridge Apartments 6417 Ridgecrest Road Dallas TX 75231
99 Comfort Inn - Richardson 220 W. Spring Valley Road Richardson TX 75081
100 Cherrywood Square Apartments 6077 S. Norcross Tucker Road Norcross GA 30093
101 Elkins Park Square 8080 Old York Road Cheltenham Township PA 19027
102 Fairfield Inn by Marriott 150 Crossways Boulevard Chesapeake VA 23320
103 Wildwood Apartments 3321 Peppertree Circle Decatur GA 30034
104 Thunderbird Business Park 3001 West Indian School Phoenix AZ 85017
105 Long Beach Avenue 1250 Long Beach Avenue Los Angeles CA 90021
106 Ball Park Inn - Arlington 903 N. Collins Arlington TX 76011
107 Best Western Inn 13700 LBJ Freeway Garland TX 75041
108 Holiday Inn Express-Plano 5021 West Plano Parkway Plano TX 75093
109 Quality Inn/Airport 5575 West Amelia Earhart Drive Salt Lake City UT 84116
110 Cinnamon Tree Apartments 111 South 1400 West Cedar City UT 84720
111 BDR - Francis Court III - Multifamily 1621 West Rialto Avenue Rialto CA 92376
112 BDR - Francis Court IV - Multifamily 1680 West Rialto Avenue Rialto CA 92376
113 BDR - Francis Court V - Multifamily 160 N. Linden Avenue Rialto CA 92376
114 Whispering Oaks Apartments 10010 Greenfork Drive Houston TX 77036
115 BDR - Sierra Point Apartments 1439 North Lilac Avenue Rialto CA 92376
116 Falls of Maplewood Apts. 9600 Glenfield Court Houston TX 77096
117 Huntington Apartments 5700 Boca Raton Blvd. Fort Worth TX 76112
118 Greenfield Apartments 2105 Cedar Bayou Baytown TX 77520
119 Moors Landing Apartments 294 Merion Avenue Carney's Point NJ 08069
120 Best Western - Park Suites 640 Park Blvd East Plano TX 75074
121 Comfort Inn - Plano 621 Central Parkway East Plano TX 75074
122 Parkwood Apartments 2450 Peach Tree Drive Fairfield CA 94533
123 Peachwood Apartments 2215 Peach Tree Drive Fairfield CA 94533
124 Days Inn-Union City 6840 Shannon Pkwy South Union City GA 30294
125 Riverview Manor Apartments 715-903 Donaldson Street Highland Park NJ 08904
126 Kasco Industrial Portfolio Various El Paso TX 79906
127 Best Western-Courtyard Inn 1225 Janesville Ave Ft. Atkinson WI 53538
128 Super 8 - Whitewater, WI 917 E. Milwaukee Ave. Whitewater WI 53190
129 Pompano Plaza 1401 South Federal Highway Pompano Beach FL 33062
130 Lincoln Menlo Phase VIII 1003-1005 Hamilton Court Menlo Park CA 94025
131 AAAAA Rent-A-Space - Foster City 1221 E. Hillsdale Blvd Foster City CA 94404
132 AAAAA Rent-A-Space - Colma 3601 Junipero Serra Colma CA 94014
133 Caruth Plaza Shopping 9000 N. Central Expressway Dallas TX 75215
134 River Oaks Village Shopping Cr 3700 Lorna Road Hoover AL 35216
135 Wyncove Apartments 3251 Commerce Drive East Point GA 30344
136 Wyncreek Apartments 588 Little Street Marietta GA 30060
137 Brookside Apartments 3661 North Decatur Road Decatur GA 30032
138 Highland Point Shopping Center 1900-1952 FM Road 407 Highland Village TX 75067
139 Holiday Inn - St. Augustine 1300 Ponce de Leon Boulevard St. Augustine FL 32804
140 Rustic Village Apartments 9303 Town Park Drive Houston TX 77036
141 Northrich Village Shopping Ctr 510-520 Arapaho Road Richardson TX 75080
142 2-8 Washington Avenue 2-8 Washington Avenue Chelsea MA 02150
143 Riverview Apartments 78 Pheasant Road Peterborough NH 03458
144 Del Norte Apartments 6134 4th Street, NW Village of Los Ranchos NM 87107
145 Budgetel Inn - Atlanta Airport 2480 Old National Parkway College Park GA 30349
146 Holiday Inn Express-Oakhurst 40662 Highway 41 Oakhurst CA 91301
147 Holiday Inn Express-Mariposa 5059 Highway 140 Mariposa CA 95338
148 Holiday Inn Express-Fresno 6051 North Thesta Street Fresno CA 93710
149 Flower Avenue Shopping Center 8701-8749 Flower Avenue Silver Spring MD 20901
150 Riverwalk Plaza 20 MacCorkle Ave., Southwest South Charleston WV 25315
151 Ashley Gables Apartments 2225 131st Avenue East Tampa FL 33612
152 Plymouth Towne Apartments 107 Haggerty Road Plymouth MI 48170
153 Brook Apartments 5328 Montgomery Boulevard N.E. Albuquerque NM 87109
154 Woodridge Plaza Shopping Ctr 6969 Gulf Freeway Houston TX 77087
155 El Royale Apartments 1414 N. Riverside Avenue Rialto CA 92376
156 Terrytown Village Apartments 733 Carrollwood Village Drive Gretna LA 70056
157 Santa Fe Square 5231 Blanco Road San Antonio TX 78213
158 Lochhaven Apartments 2900 NW 56th Avenue Lauderhill FL 33313
159 Valle Sereno Apartments 9133 Kernel Circle El Paso TX 79907
160 Landmark Towers Apartments 601 NW 42nd Avenue Plantation FL 33317
161 Spring Ridge Apartments 3604 Legendary Drive Dallas TX 74224
162 Danubia Apartments 5301-5325 North 17th Street McAllen TX 78504
163 Harker Heights Shopping Center 702-706 Edwards Drive Killeen TX 76543
164 Capitol Plaza Shopping Center South Blvd. & Woodley Road Montgomery AL 36116
165 9343 North Loop East 9343 North Loop East Houston TX 77029
166 Belleview Plaza Shopping Ctr NEC of Aaron Aronov Blvd & Belleview Drive Fairfield AL 35064
167 Enterprise Square Shopping Ctr Central Xpressway/Premier Dr Plano TX 75075
168 Waverly Place Shopping Center SEC Kildaire Farm Rd &Tyron Rd Cary NC 27511
169 Polo Grounds Shopping Center 890 South Military Trail West Palm Beach FL 33406
170 Marshall Plaza 919 West College Street Marshall MO 65340
171 The Woods of Mandarin 3200 Hartley Road Jacksonville FL 32257
172 Kristopher Woods Apartments 762-792 Jolly Avenue South Clarkston GA 30021
173 Lantern Ridge Apartments 1810 Roswell Road Marietta GA 30062
174 The Thicket Apartments 5816 Covington Highway Decatur GA 30035
175 Lakeside Villa Apartments 3600 Ashford Dunwoody Road Atlanta GA 30319
176 Shoreham Apartments 2001 Dawson Road Albany GA 31707
177 Tahoe North Apartments-Phase I 1000 Holcomb Bridge Road Roswell GA 30076
178 Tahoe North Apartments-PhaseII 1000 Holcomb Bridge Road Roswell GA 30076
179 Century American Insurance Blg 2828 Croasdaile Drive Durham NC 27705
180 Apopka Square Center 823 Semoran Blvd. S.R.436/441 Apopka FL 32703
181 Castro Commons Prof. Center 1172 and 1174 Castro Street Mountain View CA 94043
182 Markham Building 2301 14th Street Gulfport MS 39501
183 Morristown Plaza Shopping Ctr 30 Lafayette Ave Morristown NJ 07960
184 Atlantic Square Shopping Ctr. 2500 - 2780 E. Atlantic Blvd. Pompano Beach FL 33062
185 264 Water Street 264 Water Street New York NY 10038
186 Banyan Bay Apartments 703 NE 63rd Street Miami FL 33138
187 Bentsen Grove 810 N. Bentsen Palm Drive Mission TX 78572
188 Collegiate Suites 1101A Patrick Henry Drive Blacksburg VA 24060
189 Cottonwood Apartments 6441 Cypress Street Santa Fe NM 85701
190 El Dorado/Pipers Cove Apartments 240/270 El Dorado Boulevard Houston TX 77598
191 Glen Apartments 2809 West Glen Drive Falls Church VA 22046
193 Las Brisas 302 E. Union Avenue Las Cruces NM 88001
194 Morningstar Self Storage 10833 Monroe Road Matthews NC 28105
195 Oak Meadow Park 31750 NW Pacific North Plains OR 97133
196 Pepper Hill Apartments 3484 Mountainbrook Ave N. Charleston SC 29420
197 Pines of Green Run 1302 Pine Cone Circle Virginia Beach VA 23456
198 Quail Hill 5102 Galley Road Colorado Springs CO 80915
199 Stockdale Villa 3535 Stine Road Bakersfield CA 93309
200 The Chalet 6115 Jack Finney Boulevard Greenville TX 75402
201 Vista Village 5000 Butte Street Boulder CO 80301
202 Arizona Acres 9421 E. Apache Trail Mesa AZ 85207
203 Bonita Vista 2175 West Southern Avenue Apache Junction AZ 85220
204 Country Club 5600 S. Country Club Road Tucson AZ 85706
205 Rock Shadows 600 S. Idaho Road Apache Junction AZ 85220
207 Sandy Lakes Apartments 3650 E. Lake Mead Blvd. Las Vegas NV 89115
208 Tuckertown Village 41 Little Pond Road S. Kingstown RI 02879
209 6550 Collins 6550 Collins Avenue Miami Beach FL 33141
210 The Landings Apartments 3306 West Main Street Kalamazoo MI 49006
211 Claire Tower 1041 Marion Street Columbia SC 29201
212 Holden Crossing 3700 S. Holden Road Greensboro NC 27406
213 West Chase 301 N. Shackleford Road Little Rock AR 72211
214 InnsbrookApartments 18800 Innsbrook Drive Northville MI 48167
215 Holiday/Hampton 1813 W. Mercury Blvd. Hampton VA 23666
(2) 216 Terrace View 600 Trillo Road Baltimore MD 21225
(2) 216 Terrace View MD
217 Springfield Apartments 18500 Redmond Way Redmond WA 98052
218 Lakehurst Shurguard Mini-Storage 6040 Lakehurst Drive Orlando FL 32819
219 Boca / Deerfield Self Storage 3604 NW 2nd & 950 S. Powerline Rd Boca Raton & Deerfield FL 33431 & 33442
220 Devonshire Apartments 12648 N.E. 144th Street Kirkland WA 98034
</TABLE>
- ---------------
(1) Servicing Fees consist of Sub-Servicing, Master Servicing, Special
Servicing and Trustee Fees.
(2) Control Number 216 Represent Two Mortgage Loan for One Property.
<PAGE>
<TABLE>
MLMI 1997-C1
MORTGAGE LOAN SCHEDULE
<CAPTION>
Control Original Cut-off Date Monthly Gross Remaining Maturity Ground
Number Balance Balance Payment Rate Term Amort Date Lease
- ------ -------- ------------ ------- ----- ---- ----- -------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 $ 4,700,000 $ 4,684,339.29 $ 34,815.14 8.100 55 355 1/1/02 No
2 $ 4,080,000 $ 4,058,608.87 $ 31,760.86 8.100 55 295 1/1/02 No
3 $ 1,600,000 $ 1,593,543.56 $ 15,334.49 9.900 237 237 3/1/17 No
4 $ 1,610,000 $ 1,603,503.21 $ 15,430.33 9.900 237 237 3/1/17 No
5 $ 4,150,000 $ 4,142,388.64 $ 31,880.50 8.490 117 357 3/1/07 No
6 $ 1,400,000 $ 1,389,663.91 $ 12,803.99 9.230 235 235 1/1/17 No
7 $ 5,624,000 $ 5,610,169.98 $ 43,164.00 8.480 80 356 2/1/04 No
8 $ 5,516,000 $ 5,502,435.57 $ 42,335.11 8.480 80 356 2/1/04 No
9 $ 3,098,000 $ 3,090,381.68 $ 23,777.04 8.480 80 356 2/1/04 No
10 $ 6,280,000 $ 6,264,556.80 $ 48,198.78 8.480 80 356 2/1/04 No
11 $ 1,200,000 $ 1,195,781.32 $ 9,440.40 8.750 114 354 12/1/06 No
12 $ 4,200,000 $ 4,187,764.97 $ 33,904.49 8.530 117 297 3/1/07 No
13 $ 5,000,000 $ 4,984,185.50 $ 39,869.56 8.630 116 320 2/1/07 No
14 $ 7,800,000 $ 7,770,811.96 $ 62,238.67 8.690 79 325 1/1/04 No
15 $ 3,150,000 $ 3,136,042.12 $ 26,715.67 9.130 115 295 1/1/07 No
16 $ 1,376,000 $ 1,371,084.16 $ 11,603.93 9.060 116 296 2/1/07 No
17 $ 2,180,000 $ 2,173,659.83 $ 17,612.75 8.540 81 297 3/1/04 No
18 $ 2,800,000 $ 2,793,657.66 $ 22,288.09 8.880 116 356 2/1/07 No
19 $ 9,850,000 $ 9,803,536.17 $ 80,981.15 8.750 115 295 1/1/07 No
20 $ 3,550,000 $ 3,533,634.63 $ 29,524.52 8.890 79 295 1/1/04 No
21 $ 850,000 $ 846,081.53 $ 7,069.25 8.890 79 295 1/1/04 No
22 $ 2,850,000 $ 2,835,715.10 $ 23,299.14 8.970 113 323 11/1/06 No
23 $ 5,509,000 $ 5,482,701.83 $ 44,853.24 8.970 113 329 11/1/06 No
24 $ 1,600,000 $ 1,592,315.47 $ 13,034.93 8.640 115 295 1/1/07 No
25 $ 1,000,000 $ 998,025.35 $ 8,436.45 9.340 117 327 3/1/07 No
26 $ 9,635,000 $ 9,616,136.91 $ 71,843.37 8.170 57 357 3/1/02 No
27 $ 3,580,000 $ 3,573,298.36 $ 27,248.50 8.390 81 357 3/1/04 No
28 $ 7,600,000 $ 7,585,773.05 $ 57,845.98 8.390 81 357 3/1/04 No
29 $ 1,930,000 $ 1,926,718.19 $ 16,608.15 9.310 118 298 4/1/07 No
30 $ 4,087,500 $ 4,081,391.57 $ 32,473.26 8.640 118 328 4/1/07 Yes
31 $ 3,650,000 $ 3,645,376.46 $ 27,549.64 8.300 82 358 4/1/04 No
32 $ 2,200,000 $ 2,195,915.21 $ 16,807.08 8.430 117 357 3/1/07 No
33 $ 2,700,000 $ 2,696,607.69 $ 20,455.28 8.340 82 358 4/1/04 No
34 $ 2,250,000 $ 2,245,896.91 $ 18,712.72 8.890 118 298 4/1/07 No
35 $ 2,130,000 $ 2,127,285.30 $ 16,031.94 8.270 82 358 4/1/04 No
36 $ 1,850,000 $ 1,846,512.95 $ 15,134.32 8.690 118 298 4/1/07 No
37 $ 1,400,000 $ 1,396,585.29 $ 10,784.64 8.520 116 356 2/1/07 No
38 $ 1,200,000 $ 1,195,368.11 $ 9,735.61 8.590 116 296 2/1/07 No
39 $ 4,200,000 $ 4,192,468.81 $ 32,592.49 8.600 117 357 3/1/07 No
40 $ 2,390,000 $ 2,386,259.71 $ 18,573.71 8.390 58 328 4/1/02 No
41 $ 4,600,000 $ 4,592,164.98 $ 39,552.39 9.300 142 298 4/1/09 No
42 $ 6,500,000 $ 6,488,272.56 $ 50,302.19 8.570 117 357 3/1/07 No
43 $ 6,650,000 $ 6,580,645.53 $ 60,775.90 9.220 233 233 11/1/16 No
44 $ 5,740,000 $ 5,680,136.14 $ 52,459.20 9.220 233 233 11/1/16 No
45 $ 4,480,000 $ 4,433,276.99 $ 40,943.77 9.220 233 233 11/1/16 No
46 $10,750,000 $10,733,361.32 $ 83,988.07 8.450 142 328 4/1/09 No
47 $ 5,040,000 $ 4,987,436.61 $ 46,061.74 9.220 233 233 11/1/16 No
48 $11,200,000 $11,083,192.48 $102,359.42 9.220 233 233 11/1/16 No
49 $ 3,440,000 $ 3,404,123.40 $ 31,438.96 9.220 233 233 11/1/16 No
50 $ 6,586,000 $ 6,573,483.41 $ 53,655.05 8.640 82 298 4/1/04 No
51 $ 6,500,000 $ 6,490,778.60 $ 52,910.29 8.920 118 328 4/1/07 No
52 $ 2,030,000 $ 2,018,082.81 $ 17,750.16 9.510 113 293 11/1/06 No
53 $ 1,100,000 $ 1,093,308.80 $ 8,731.84 8.330 114 294 12/1/06 No
54 $ 2,600,000 $ 2,579,176.46 $ 26,324.55 8.970 177 177 3/1/12 No
55 $ 8,200,000 $ 8,170,699.56 $ 66,863.42 8.940 235 325 1/1/17 Yes
56 $ 4,075,000 $ 4,039,703.22 $ 37,824.83 9.440 234 234 12/1/16 No
57 $ 4,825,000 $ 4,783,206.88 $ 44,786.45 9.440 234 234 12/1/16 No
58 $ 1,975,000 $ 1,966,969.08 $ 15,622.04 8.810 113 353 11/1/06 No
59 $ 3,300,000 $ 3,276,333.88 $ 30,674.18 9.460 235 235 1/1/17 No
60 $ 4,400,000 $ 4,380,206.45 $ 35,139.64 8.700 114 324 12/1/06 No
61 $15,000,000 $14,926,238.37 $117,953.45 8.470 78 318 12/1/03 No
62 $ 1,400,000 $ 1,391,566.25 $ 11,169.59 8.390 114 294 12/1/06 No
63 $ 5,500,000 $ 5,472,216.85 $ 43,659.18 8.330 55 295 1/1/02 No
64 $ 1,540,000 $ 1,529,382.21 $ 14,627.43 9.770 235 235 1/1/17 No
65 $ 4,833,000 $ 4,806,120.49 $ 40,161.95 8.880 54 294 12/1/01 No
66 $ 3,400,000 $ 3,389,511.74 $ 26,094.88 8.480 79 355 1/1/04 No
67 $ 3,100,000 $ 3,084,841.48 $ 25,024.74 8.530 115 295 1/1/07 No
68 $ 4,400,000 $ 4,384,487.71 $ 37,347.38 9.140 176 296 2/1/12 No
69 $ 5,400,000 $ 5,384,061.91 $ 43,300.46 8.450 117 297 3/1/07 No
70 $ 2,000,000 $ 1,988,821.84 $ 16,578.97 8.850 114 294 12/1/06 No
71 $ 3,500,000 $ 3,488,182.96 $ 30,336.44 9.400 116 296 2/1/07 No
72 $ 2,542,000 $ 2,528,142.84 $ 24,245.23 9.830 236 236 2/1/17 No
73 $ 1,650,000 $ 1,648,137.35 $ 13,110.40 8.860 178 358 4/1/12 No
74 $ 7,200,000 $ 7,187,021.65 $ 60,225.04 8.960 118 298 4/1/07 No
75 $ 1,850,000 $ 1,846,460.88 $ 15,021.58 8.600 118 298 4/1/07 No
76 $ 7,250,000 $ 7,245,767.97 $ 56,673.70 8.680 119 359 5/1/07 No
77 $ 2,400,000 $ 2,397,343.24 $ 21,916.76 9.630 263 263 5/1/19 No
78 $ 2,100,000 $ 2,097,162.02 $ 19,987.98 9.800 239 239 5/1/17 No
79 $ 988,000 $ 987,127.50 $ 8,331.89 9.060 179 299 5/1/12 No
80 $ 1,230,000 $ 1,228,913.80 $ 10,372.70 9.060 179 299 5/1/12 No
81 $ 7,000,000 $ 6,996,348.17 $ 57,435.16 9.220 119 359 5/1/07 No
82 $ 1,223,000 $ 1,220,097.70 $ 13,277.42 10.180 179 179 5/1/12 No
83 $ 2,000,000 $ 1,998,865.89 $ 15,834.10 8.820 119 359 5/1/07 No
84 $ 1,450,000 $ 1,448,689.32 $ 12,089.01 8.920 179 299 5/1/12 No
85 $12,800,000 $12,792,920.42 $102,439.58 8.940 119 359 5/1/07 Yes
86 $ 2,070,000 $ 2,068,293.37 $ 18,042.37 9.470 119 299 5/1/07 No
87 $ 4,520,000 $ 4,517,284.23 $ 34,883.10 8.540 119 359 5/1/07 No
88 $ 3,200,000 $ 3,197,059.05 $ 26,460.95 8.820 119 299 5/1/07 No
89 $ 1,160,000 $ 1,159,372.95 $ 9,375.39 9.050 119 359 5/1/07 No
90 $ 1,600,000 $ 1,598,608.12 $ 13,591.87 9.150 119 299 5/1/07 No
91 $ 1,480,000 $ 1,478,723.24 $ 12,623.43 9.200 83 299 5/1/04 No
92 $ 4,580,000 $ 4,536,489.76 $ 44,076.68 9.960 233 233 11/1/16 No
93 $ 2,475,000 $ 2,458,535.06 $ 20,348.05 8.750 77 293 11/1/03 No
94 $ 1,625,000 $ 1,618,160.63 $ 14,129.85 9.440 115 295 1/1/07 No
95 $ 1,750,000 $ 1,743,189.69 $ 14,138.68 8.540 116 296 2/1/07 No
96 $ 3,500,000 $ 3,491,410.70 $ 26,887.17 8.490 116 356 2/1/07 No
97 $ 3,600,000 $ 3,586,707.87 $ 27,706.40 8.510 174 354 12/1/11 No
98 $ 800,000 $ 799,530.11 $ 6,236.55 8.650 59 359 5/1/02 No
99 $ 1,800,000 $ 1,800,000.00 $ 16,754.86 9.480 240 240 6/1/17 No
100 $ 1,950,000 $ 1,950,000.00 $ 15,992.07 8.720 120 300 6/1/07 No
101 $ 3,600,000 $ 3,600,000.00 $ 29,842.15 8.850 120 300 6/1/07 No
102 $ 3,600,000 $ 3,600,000.00 $ 33,041.23 9.280 240 240 6/1/17 No
103 $ 2,567,000 $ 2,564,755.70 $ 21,753.50 9.120 299 299 5/1/22 No
104 $ 3,845,000 $ 3,841,643.96 $ 32,610.08 9.130 83 299 5/1/04 No
105 $ 5,060,000 $ 5,060,000.00 $ 38,799.49 8.470 120 360 6/1/07 No
106 $ 2,250,000 $ 2,233,884.43 $ 20,928.89 9.470 235 235 1/1/17 No
107 $ 2,600,000 $ 2,581,377.56 $ 24,184.50 9.470 235 235 1/1/17 No
108 $ 2,780,000 $ 2,759,215.55 $ 25,245.28 9.130 235 235 1/1/17 No
109 $ 6,370,000 $ 6,316,541.50 $ 60,169.32 9.690 234 234 12/1/16 No
110 $ 1,470,000 $ 1,456,255.74 $ 13,065.68 8.830 234 234 12/1/16 No
111 $ 1,350,000 $ 1,344,881.93 $ 10,265.74 8.380 114 354 12/1/06 No
112 $ 850,000 $ 846,777.51 $ 6,463.61 8.380 114 354 12/1/06 No
113 $ 1,500,000 $ 1,494,313.26 $ 11,406.38 8.380 114 354 12/1/06 No
114 $ 1,560,000 $ 1,552,446.14 $ 12,656.30 8.590 115 295 1/1/07 No
115 $ 2,020,000 $ 2,015,348.32 $ 15,963.54 8.800 116 356 2/1/07 No
116 $ 1,550,000 $ 1,544,172.07 $ 12,743.23 8.750 80 296 2/1/04 No
117 $ 2,510,000 $ 2,508,438.30 $ 19,068.96 8.370 59 359 5/1/02 No
118 $ 2,580,000 $ 2,578,440.24 $ 19,856.26 8.510 119 359 5/1/07 No
119 $ 3,000,000 $ 3,000,000.00 $ 24,399.89 8.620 120 300 6/1/07 No
120 $ 2,750,000 $ 2,750,000.00 $ 25,293.38 9.310 240 240 6/1/17 No
121 $ 1,750,000 $ 1,750,000.00 $ 16,095.78 9.310 240 240 6/1/17 No
122 $ 3,955,000 $ 3,955,000.00 $ 29,796.05 8.280 84 360 6/1/04 No
123 $ 2,250,000 $ 2,250,000.00 $ 16,950.98 8.280 84 360 6/1/04 No
124 $ 2,500,000 $ 2,500,000.00 $ 23,417.68 9.570 240 240 6/1/17 No
125 $ 2,600,000 $ 2,600,000.00 $ 21,216.98 8.660 120 300 6/1/07 No
126 $ 9,500,000 $ 9,500,000.00 $ 77,665.94 8.920 120 324 6/1/07 Yes
127 $ 1,750,000 $ 1,750,000.00 $ 15,781.15 9.460 264 264 6/1/19 No
128 $ 1,700,000 $ 1,700,000.00 $ 15,444.32 9.560 264 264 6/1/19 No
129 $ 3,250,000 $ 3,250,000.00 $ 26,852.28 8.810 120 300 6/1/07 No
130 $ 5,400,000 $ 5,400,000.00 $ 43,810.26 8.590 84 300 6/1/04 No
131 $ 5,690,000 $ 5,690,000.00 $ 49,990.49 9.570 300 300 6/1/22 No
132 $10,550,000 $10,550,000.00 $ 92,688.87 9.570 300 300 6/1/22 No
133 $11,770,000 $11,770,000.00 $ 91,085.67 8.570 120 360 6/1/07 No
134 $ 1,600,000 $ 1,402,153.88 $ 16,109.51 8.875 140 140 2/1/09 No
135 $ 1,350,000 $ 1,322,582.08 $ 12,602.10 10.350 58 274 4/1/02 No
136 $ 1,550,000 $ 1,519,333.10 $ 12,795.92 8.800 64 280 10/1/02 No
137 $ 1,750,000 $ 1,730,840.10 $ 15,554.38 8.830 113 233 11/1/06 No
138 $ 3,350,000 $ 3,329,755.36 $ 27,228.67 8.740 113 305 11/1/06 No
139 $ 2,236,000 $ 2,233,541.46 $ 21,135.35 9.700 119 239 5/1/07 No
140 $ 2,900,000 $ 2,880,433.32 $ 25,337.20 9.500 112 292 10/1/06 No
141 $ 4,100,000 $ 4,058,692.79 $ 36,178.46 9.625 108 288 6/1/06 No
142 $ 715,000 $ 708,991.15 $ 6,281.76 9.570 110 290 8/1/06 No
143 $ 1,315,000 $ 1,303,658.83 $ 10,954.50 8.910 51 291 9/1/01 No
144 $ 2,814,000 $ 2,799,269.53 $ 22,318.88 8.840 111 351 9/1/06 No
145 $ 2,200,000 $ 2,185,375.73 $ 20,489.82 10.320 171 291 9/1/11 No
146 $ 1,520,000 $ 1,501,372.72 $ 14,668.33 10.000 171 231 9/1/11 No
147 $ 1,700,000 $ 1,679,166.84 $ 16,405.37 10.000 171 231 9/1/11 No
148 $ 1,980,000 $ 1,955,735.49 $ 19,107.43 10.000 171 231 9/1/11 No
149 $ 2,450,000 $ 2,433,332.15 $ 21,320.48 9.450 112 292 10/1/06 No
150 $ 8,690,000 $ 8,629,348.28 $ 74,689.60 9.295 112 292 10/1/06 No
151 $ 7,400,000 $ 7,361,948.07 $ 56,010.46 8.330 76 352 10/1/03 No
152 $ 3,109,000 $ 3,089,015.28 $ 26,005.51 8.960 113 293 11/1/06 No
153 $ 3,785,500 $ 3,761,046.84 $ 31,586.52 8.930 113 293 11/1/06 No
154 $ 2,850,000 $ 2,819,977.91 $ 25,899.36 9.140 77 233 11/1/03 No
155 $ 2,500,000 $ 2,471,310.48 $ 20,793.73 9.375 63 339 9/1/02 No
156 $ 1,980,000 $ 1,956,168.34 $ 15,753.77 8.875 100 340 10/1/05 No
157 $ 1,800,000 $ 1,783,443.59 $ 15,883.23 9.625 49 289 7/1/01 No
158 $ 3,000,000 $ 2,908,488.79 $ 26,034.70 8.500 222 222 12/1/15 No
159 $ 1,925,000 $ 1,850,991.07 $ 19,668.03 9.125 166 166 4/1/11 No
160 $ 2,700,000 $ 2,660,360.22 $ 22,197.88 8.750 105 285 3/1/06 No
161 $ 1,625,000 $ 1,602,984.02 $ 13,916.20 9.250 285 285 3/1/21 No
162 $ 1,718,000 $ 1,708,816.22 $ 14,760.27 9.750 73 349 7/1/03 No
163 $ 2,300,000 $ 2,287,271.00 $ 19,159.96 8.910 114 294 12/1/06 No
164 $ 4,700,000 $ 4,672,725.28 $ 38,226.50 8.620 78 294 12/1/03 No
165 $ 2,575,000 $ 2,563,533.25 $ 21,785.91 9.100 115 295 1/1/07 No
166 $ 6,065,000 $ 6,043,116.31 $ 50,897.26 9.000 80 296 2/1/04 No
167 $ 6,180,000 $ 6,158,336.76 $ 52,668.77 9.190 116 296 2/1/07 No
168 $10,880,000 $10,853,609.73 $ 87,975.61 8.550 117 297 3/1/07 No
169 $ 5,200,000 $ 5,185,024.76 $ 42,222.81 8.600 117 297 3/1/07 No
170 $ 1,900,000 $ 1,897,301.51 $ 16,442.02 9.380 118 298 4/1/07 No
171 $ 5,485,000 $ 5,445,335.00 $ 43,033.05 8.720 48 348 6/1/01 No
172 $ 4,045,000 $ 4,020,626.08 $ 33,042.98 9.170 109 349 7/1/06 No
173 $ 3,650,000 $ 3,627,413.08 $ 29,473.84 9.040 109 349 7/1/06 No
174 $ 7,392,000 $ 7,346,256.87 $ 59,690.58 9.040 73 349 7/1/03 No
175 $ 6,620,000 $ 6,582,518.12 $ 53,218.39 8.990 74 350 8/1/03 No
176 $ 2,978,000 $ 2,959,571.57 $ 24,047.42 9.040 109 349 7/1/06 No
177 $ 5,845,000 $ 5,817,174.34 $ 45,815.76 8.710 76 352 10/1/03 No
178 $ 8,335,000 $ 8,295,320.51 $ 65,333.50 8.710 76 352 10/1/03 No
179 $ 4,500,000 $ 4,478,598.32 $ 36,843.72 8.700 55 295 1/1/02 No
180 $ 2,335,000 $ 2,322,992.78 $ 18,363.52 8.220 79 295 1/1/04 No
181 $ 5,900,000 $ 5,896,181.15 $ 49,391.43 8.970 119 299 5/1/07 Yes
182 $ 2,175,000 $ 2,173,807.80 $ 19,078.55 9.550 119 299 5/1/07 No
183 $ 2,940,000 $ 2,938,245.31 $ 25,197.92 9.260 119 299 5/1/07 No
184 $ 4,100,000 $ 4,100,000.00 $ 34,154.72 8.910 120 300 6/1/07 No
185 $ 3,682,500 $ 3,672,031.89 $ 30,101.00 8.680 117 297 3/1/07 No
186 $10,400,000 $10,372,055.90 $ 76,674.00 8.050 116 356 1/31/07 No
187 $ 3,734,000 $ 3,719,890.99 $ 30,622.77 8.720 116 296 1/31/07 No
188 $ 4,560,000 $ 4,555,861.10 $ 35,863.77 8.747 118 358 4/1/07 No
189 $ 8,000,000 $ 7,974,914.20 $ 62,080.94 8.600 114 354 11/30/06 No
190 $ 9,791,000 $ 9,779,433.09 $ 76,257.91 8.640 118 358 4/1/07 No
191 $ 5,400,000 $ 5,391,492.16 $ 44,198.24 8.880 118 316 4/1/07 No
193 $ 3,500,000 $ 3,493,627.98 $ 29,132.57 8.900 299 299 5/1/22 No
194 $ 2,000,000 $ 1,991,115.03 $ 16,483.66 8.780 115 295 12/31/06 No
195 $ 1,345,000 $ 1,343,474.40 $ 10,668.00 8.840 118 358 4/1/07 No
196 $ 2,595,000 $ 2,585,221.51 $ 21,334.63 8.750 116 296 1/31/07 No
197 $ 7,000,000 $ 6,981,169.26 $ 51,608.00 8.050 116 356 1/31/07 No
198 $ 2,850,000 $ 2,835,605.64 $ 23,702.78 8.890 114 294 11/30/06 No
199 $ 2,978,000 $ 2,968,147.93 $ 24,197.74 9.110 113 353 10/31/06 No
200 $ 1,462,000 $ 1,455,096.84 $ 11,723.20 8.450 115 295 1/1/07 No
201 $ 3,879,000 $ 3,864,084.07 $ 30,846.38 8.869 112 352 9/30/06 Yes
202 $ 2,550,000 $ 2,524,946.87 $ 18,764.33 8.030 68 344 1/26/03 No
203 $ 5,500,000 $ 5,475,918.34 $ 45,846.00 9.400 109 349 6/26/06 No
204 $ 2,450,000 $ 2,439,101.51 $ 19,943.00 9.130 74 350 7/17/03 No
205 $ 4,800,000 $ 4,771,985.26 $ 38,760.12 9.040 107 347 3/27/06 No
207 $ 3,639,000 $ 3,635,775.70 $ 30,638.10 9.040 119 299 5/1/07 No
208 $ 2,000,000 $ 1,998,932.33 $ 16,251.00 9.110 119 359 5/1/07 No
209 $ 2,025,000 $ 2,023,856.47 $ 16,061.00 8.840 143 359 4/23/09 No
210 $ 2,836,000 $ 2,833,427.96 $ 23,605.71 8.900 119 299 5/1/07 No
211 $ 2,000,000 $ 1,998,283.29 $ 17,100.00 9.230 119 299 5/1/07 No
212 $ 8,100,000 $ 8,100,000.00 $ 67,864.00 8.980 120 300 6/1/07 No
213 $ 2,500,000 $ 2,500,000.00 $ 20,894.38 8.950 120 300 6/1/07 No
214 $10,200,000 $10,200,000.00 $ 79,261.00 9.380 50 360 8/1/01 No
215 $11,000,000 $10,715,936.00 $101,673.99 9.380 43 223 12/31/00 Yes
(2) 216 $ 2,779,000 $ 2,725,965.85 $ 23,373.34 8.680 65 281 10/31/02 No
(2) 216 $ 325,090 $ 323,899.56 $ 2,710.80 8.920 65 298 10/31/02
217 $ 6,400,000 $ 6,361,564.34 $ 55,050.52 9.630 110 350 7/31/06 No
218 $ 1,700,000 $ 1,693,652.82 $ 14,580.66 9.730 110 350 7/31/06 No
219 $13,000,000 $13,000,000.00 $106,702.08 8.730 120 300 6/1/07 No
220 $ 4,700,000 $ 4,672,264.50 $ 39,312.19 9.310 111 351 8/31/06 No
</TABLE>
- ---------------
(1) Servicing Fees consist of Sub-Servicing, Master Servicing, Special
Servicing and Trustee Fees.
(2) Control Number 216 Represent Two Mortgage Loan for One Property.
<PAGE>
<TABLE>
MLMI 1997-C1
MORTGAGE LOAN SCHEDULE
<CAPTION>
Control Underwriting Net Subservicing (1) Servicing Fee
Number Reserves Rate Fees Fees Subservicer
- ------ ------------ ---- ------------ ---------------- -----------
<S> <C> <C> <C> <C> <C>
1 225 per unit 8.035 0.060 0.065 L.J. Melody & Co.
2 265 per unit 8.035 0.060 0.065 L.J. Melody & Co.
3 4% of gross rev. 9.895 0.000 0.005 GE Capital Asset Management
4 4% of gross rev. 9.895 0.000 0.005 GE Capital Asset Management
5 270 per unit 8.485 0.000 0.005 GE Capital Asset Management
6 4% of gross rev. 9.225 0.000 0.005 GE Capital Asset Management
7 321 per unit 8.415 0.060 0.065 L.J. Melody & Co.
8 250 per unit 8.415 0.060 0.065 L.J. Melody & Co.
9 250 per unit 8.415 0.060 0.065 L.J. Melody & Co.
10 290 per unit 8.415 0.060 0.065 L.J. Melody & Co.
11 200 per unit 8.685 0.060 0.065 L.J. Melody & Co.
12 250 per unit 8.525 0.000 0.005 GE Capital Asset Management
13 286 per unit 8.625 0.000 0.005 GE Capital Asset Management
14 0.15 per sq. ft. 8.625 0.060 0.065 L.J. Melody & Co.
15 0.15 per sq. ft. 9.125 0.000 0.005 GE Capital Asset Management
16 0.15 per sq. ft. 9.055 0.000 0.005 GE Capital Asset Management
17 300 per unit 8.535 0.000 0.005 GE Capital Asset Management
18 250 per unit 8.815 0.060 0.065 L.J. Melody & Co.
19 0.15 per sq. ft. 8.745 0.000 0.005 GE Capital Asset Management
20 0.15 per sq. ft. 8.885 0.000 0.005 GE Capital Asset Management
21 0.15 per sq. ft. 8.885 0.000 0.005 GE Capital Asset Management
22 0.18 per sq. ft. 8.905 0.060 0.065 L.J. Melody & Co.
23 0.18 per sq. ft. 8.905 0.060 0.065 L.J. Melody & Co.
24 0.19 per sq. ft. 8.635 0.000 0.005 GE Capital Asset Management
25 0.24 per sq. ft. 9.275 0.060 0.065 Key Corp
26 250 per unit 8.165 0.000 0.005 GE Capital Asset Management
27 263 per unit 8.325 0.060 0.065 L.J. Melody & Co.
28 301 per unit 8.325 0.060 0.065 L.J. Melody & Co.
29 0.15 per sq. ft. 9.305 0.000 0.005 GE Capital Asset Management
30 0.15 per sq. ft. 8.575 0.060 0.065 L.J. Melody & Co.
31 250 per unit 8.235 0.060 0.065 L.J. Melody & Co.
32 253 per unit 8.425 0.000 0.005 GE Capital Asset Management
33 250 per unit 8.275 0.060 0.065 L.J. Melody & Co.
34 250 per unit 8.885 0.000 0.005 GE Capital Asset Management
35 250 per unit 8.205 0.060 0.065 L.J. Melody & Co.
36 250 per unit 8.685 0.000 0.005 GE Capital Asset Management
37 250 per unit 8.515 0.000 0.005 GE Capital Asset Management
38 250 per unit 8.585 0.000 0.005 GE Capital Asset Management
39 200 per unit 8.595 0.000 0.005 GE Capital Asset Management
40 0.15 per sq. ft. 8.325 0.060 0.065 L.J. Melody & Co.
41 0.15 per sq. ft. 9.295 0.000 0.005 GE Capital Asset Management
42 250 per unit 8.565 0.000 0.005 GE Capital Asset Management
43 4% of gross rev. 9.155 0.060 0.065 Key Corp
44 4% of gross rev. 9.155 0.060 0.065 Key Corp
45 4% of gross rev. 9.155 0.060 0.065 Key Corp
46 0.22 per sq. ft. 8.445 0.000 0.005 GE Capital Asset Management
47 4% of gross rev. 9.155 0.060 0.065 Key Corp
48 4% of gross rev. 9.155 0.060 0.065 Key Corp
49 4% of gross rev. 9.155 0.060 0.065 Key Corp
50 0.15 per sq. ft. 8.635 0.000 0.005 GE Capital Asset Management
51 0.15 per sq. ft. 8.915 0.000 0.005 GE Capital Asset Management
52 0.15 per sq. ft. 9.505 0.000 0.005 GE Capital Asset Management
53 250 per unit 8.325 0.000 0.005 GE Capital Asset Management
54 0.15 per sq. ft. 8.905 0.060 0.065 L.J. Melody & Co.
55 0.15 per sq. ft. 8.875 0.060 0.065 L.J. Melody & Co.
56 4% of gross rev. 9.375 0.060 0.065 L.J. Melody & Co.
57 4% of gross rev. 9.375 0.060 0.065 L.J. Melody & Co.
58 250 per unit 8.805 0.000 0.005 GE Capital Asset Management
59 4% of gross rev. 9.455 0.000 0.005 GE Capital Asset Management
60 0.15 per sq. ft. 8.635 0.060 0.065 L.J. Melody & Co.
61 0.18 per sq. ft. 8.465 0.000 0.005 GE Capital Asset Management
62 250 per unit 8.385 0.000 0.005 GE Capital Asset Management
63 250 per unit 8.265 0.060 0.065 L.J. Melody & Co.
64 4% of gross rev. 9.765 0.000 0.005 GE Capital Asset Management
65 0.15 per sq. ft. 8.815 0.060 0.065 L.J. Melody & Co.
66 0.15 per sq. ft. 8.475 0.000 0.005 GE Capital Asset Management
67 0.15 per sq. ft. 8.525 0.000 0.005 GE Capital Asset Management
68 0.15 per sq. ft. 9.135 0.000 0.005 GE Capital Asset Management
69 250 per unit 8.445 0.000 0.005 GE Capital Asset Management
70 50 per pad 8.845 0.000 0.005 GE Capital Asset Management
71 250 per bed 9.395 0.000 0.005 GE Capital Asset Management
72 4% of gross rev. 9.825 0.000 0.005 GE Capital Asset Management
73 200 per unit 8.855 0.000 0.005 GE Capital Asset Management
74 0.15 per sq. ft. 8.955 0.000 0.005 GE Capital Asset Management
75 250 per unit 8.595 0.000 0.005 GE Capital Asset Management
76 0.15 per sq. ft. 8.675 0.000 0.005 GE Capital Asset Management
77 4% of gross rev. 9.625 0.000 0.005 GE Capital Asset Management
78 4% of gross rev. 9.795 0.000 0.005 GE Capital Asset Management
79 250 per unit 9.055 0.000 0.005 GE Capital Asset Management
80 250 per unit 9.055 0.000 0.005 GE Capital Asset Management
81 0.15 per sq. ft. 9.215 0.000 0.005 GE Capital Asset Management
82 4% of gross rev. 10.175 0.000 0.005 GE Capital Asset Management
83 303.39 per unit 8.815 0.000 0.005 GE Capital Asset Management
84 250 per unit 8.915 0.000 0.005 GE Capital Asset Management
85 0.15 per sq. ft. 8.935 0.000 0.005 GE Capital Asset Management
86 0.16 per sq. ft. 9.465 0.000 0.005 GE Capital Asset Management
87 225 per unit 8.535 0.000 0.005 GE Capital Asset Management
88 250 per unit 8.755 0.060 0.065 L.J. Melody & Co.
89 200 per unit 9.045 0.000 0.005 GE Capital Asset Management
90 275 per unit 9.145 0.000 0.005 GE Capital Asset Management
91 0.15 per sq. ft. 9.135 0.060 0.065 L.J. Melody & Co.
92 4% of gross rev. 9.895 0.060 0.065 L.J. Melody & Co.
93 275 per unit 8.685 0.060 0.065 L.J. Melody & Co.
94 0.15 per sq. ft. 9.435 0.000 0.005 GE Capital Asset Management
95 250 per unit 8.535 0.000 0.005 GE Capital Asset Management
96 250 per unit 8.485 0.000 0.005 GE Capital Asset Management
97 250 per unit 8.505 0.000 0.005 GE Capital Asset Management
98 250 per unit 8.645 0.000 0.005 GE Capital Asset Management
99 4% of gross rev. 9.475 0.000 0.005 GE Capital Asset Management
100 250 per unit 8.715 0.000 0.005 GE Capital Asset Management
101 0.15 per sq. ft. 8.845 0.000 0.005 GE Capital Asset Management
102 4% of gross rev. 9.275 0.000 0.005 GE Capital Asset Management
103 250 per unit 9.115 0.000 0.005 GE Capital Asset Management
104 0.15 per sq. ft. 9.125 0.000 0.005 GE Capital Asset Management
105 250 per unit 8.465 0.000 0.005 GE Capital Asset Management
106 4% of gross rev. 9.465 0.000 0.005 GE Capital Asset Management
107 4% of gross rev. 9.465 0.000 0.005 GE Capital Asset Management
108 4% of gross rev. 9.125 0.000 0.005 GE Capital Asset Management
109 4% of gross rev. 9.685 0.000 0.005 GE Capital Asset Management
110 250 per unit 8.825 0.000 0.005 GE Capital Asset Management
111 250 per unit 8.375 0.000 0.005 GE Capital Asset Management
112 250 per unit 8.375 0.000 0.005 GE Capital Asset Management
113 251 per unit 8.375 0.000 0.005 GE Capital Asset Management
114 250 per unit 8.585 0.000 0.005 GE Capital Asset Management
115 225 per unit 8.795 0.000 0.005 GE Capital Asset Management
116 250 per unit 8.745 0.000 0.005 GE Capital Asset Management
117 250 per unit 8.365 0.000 0.005 GE Capital Asset Management
118 250 per unit 8.505 0.000 0.005 GE Capital Asset Management
119 250 per unit 8.615 0.000 0.005 GE Capital Asset Management
120 4% of gross rev. 9.305 0.000 0.005 GE Capital Asset Management
121 4% of gross rev. 9.305 0.000 0.005 GE Capital Asset Management
122 250 per unit 8.215 0.060 0.065 L.J. Melody & Co.
123 250 per unit 8.215 0.060 0.065 L.J. Melody & Co.
124 4% of gross rev. 9.565 0.000 0.005 GE Capital Asset Management
125 300 per unit 8.655 0.000 0.005 GE Capital Asset Management
126 0.15 per sq. ft. 8.915 0.000 0.005 GE Capital Asset Management
127 4% of gross rev. 9.455 0.000 0.005 GE Capital Asset Management
128 4% of gross rev. 9.555 0.000 0.005 GE Capital Asset Management
129 0.15 per sq. ft. 8.805 0.000 0.005 GE Capital Asset Management
130 0.15 per sq. ft. 8.585 0.000 0.005 GE Capital Asset Management
131 0.15 per sq. ft. 9.565 0.000 0.005 GE Capital Asset Management
132 0.15 per sq. ft. 9.565 0.000 0.005 GE Capital Asset Management
133 0.15 per sq. ft. 8.565 0.000 0.005 GE Capital Asset Management
134 0.1 Per Sq Ft 8.645 0.225 0.23 Collateral Mortgage, Ltd.
135 200 Per Unit 8.410 1.935 1.94 Collateral Mortgage, Ltd.
136 200 Per Unit 8.440 0.355 0.36 Collateral Mortgage, Ltd.
137 249.77 Per Unit 8.700 0.125 0.13 Collateral Mortgage, Ltd.
138 0.15 Per Sq Ft 8.610 0.125 0.13 Collateral Mortgage, Ltd.
139 464.8 Per Room 9.570 0.125 0.13 Continental Wingate Mortgage Group
140 254 Per Unit 9.370 0.125 0.13 Boatman's/NationsBank
141 0.15 Per Sq Ft 9.495 0.125 0.13 Continental Wingate Mortgage Group
142 322 Per Unit 9.440 0.125 0.13 Continental Wingate Mortgage Group
143 300 Per Unit 8.780 0.125 0.13 Continental Wingate Mortgage Group
144 250 Per Unit 8.710 0.125 0.13 Continental Wingate Mortgage Group
145 489.22 Per Room 10.190 0.125 0.13 Continental Wingate Mortgage Group
146 773 Per Room 9.870 0.125 0.13 Continental Wingate Mortgage Group
147 744 Per Room 9.870 0.125 0.13 Continental Wingate Mortgage Group
148 769 Per Room 9.870 0.125 0.13 Continental Wingate Mortgage Group
149 0.15 Per Sq Ft 9.320 0.125 0.13 Continental Wingate Mortgage Group
150 0.15 Per Sq Ft 9.165 0.125 0.13 Continental Wingate Mortgage Group
151 250 Per Unit 8.200 0.125 0.13 Continental Wingate Mortgage Group
152 300 per bed 8.830 0.125 0.13 Continental Wingate Mortgage Group
153 250 Per Unit 8.800 0.125 0.13 Continental Wingate Mortgage Group
154 0.2 Per Sq Ft 9.010 0.125 0.13 Continental Wingate Mortgage Group
155 371 Per Unit 9.120 0.250 0.255 Boatman's/NationsBank
156 150 Per Unit 8.620 0.250 0.255 Boatman's/NationsBank
157 220 Per Unit 9.370 0.250 0.255 Boatman's/NationsBank
158 280 Per Unit 8.245 0.250 0.255 Boatman's/NationsBank
159 145.28 Per Unit 8.870 0.250 0.255 Boatman's/NationsBank
160 226.63 Per Unit 8.495 0.250 0.255 Boatman's/NationsBank
161 275 Per Unit 8.995 0.250 0.255 Boatman's/NationsBank
162 266 Per Unit 9.495 0.250 0.255 Boatman's/NationsBank
163 0.15 Per Sq Ft 8.780 0.125 0.13 Continental Wingate Mortgage Group
164 0.15 Per Sq Ft 8.490 0.125 0.13 Continental Wingate Mortgage Group
165 0.15 Per Sq Ft 8.970 0.125 0.13 Continental Wingate Mortgage Group
166 0.19 Per Sq Ft 8.870 0.125 0.13 Continental Wingate Mortgage Group
167 0.15 Per Sq Ft 9.060 0.125 0.13 Continental Wingate Mortgage Group
168 0.15 Per Sq Ft 8.420 0.125 0.13 Continental Wingate Mortgage Group
169 0.16 Per Sq Ft 8.470 0.125 0.13 Continental Wingate Mortgage Group
170 0.2 Per Sq Ft 9.250 0.125 0.13 Continental Wingate Mortgage Group
171 250 Per Unit 8.590 0.125 0.13 Continental Wingate Mortgage Group
172 250 Per Unit 9.040 0.125 0.13 Continental Wingate Mortgage Group
173 250 Per Unit 8.910 0.125 0.13 Continental Wingate Mortgage Group
174 250 Per Unit 8.910 0.125 0.13 Continental Wingate Mortgage Group
175 269 Per Unit 8.860 0.125 0.13 Continental Wingate Mortgage Group
176 263 Per Unit 8.910 0.125 0.13 Continental Wingate Mortgage Group
177 254.22 Per Unit 8.580 0.125 0.13 Continental Wingate Mortgage Group
178 305 Per Unit 8.580 0.125 0.13 Continental Wingate Mortgage Group
179 0.15 Per Sq Ft 8.570 0.125 0.13 Continental Wingate Mortgage Group
180 0.15 Per Sq Ft 8.090 0.125 0.13 Continental Wingate Mortgage Group
181 0.15 Per Sq Ft 8.840 0.125 0.13 Continental Wingate Mortgage Group
182 0.37 Per Sq Ft 9.420 0.125 0.13 Continental Wingate Mortgage Group
183 0.18 Per Sq Ft 9.130 0.125 0.13 Continental Wingate Mortgage Group
184 0.15 Per Sq Ft 8.780 0.125 0.13 Continental Wingate Mortgage Group
185 200 per unit 8.675 0.000 0.005 GE Capital Asset Management
186 285 per unit 8.045 0.000 0.005 GE Capital Asset Management
187 56.41 per pad 8.715 0.000 0.005 GE Capital Asset Management
188 250 per unit 8.742 0.000 0.005 GE Capital Asset Management
189 28.65 per pad 8.595 0.000 0.005 GE Capital Asset Management
190 242.54 per unit 8.635 0.000 0.005 GE Capital Asset Management
191 250 per unit 8.875 0.000 0.005 GE Capital Asset Management
193 25 per pad 8.895 0.000 0.005 GE Capital Asset Management
194 0.15 per sq ft 8.775 0.000 0.005 GE Capital Asset Management
195 25 per pad 8.835 0.000 0.005 GE Capital Asset Management
196 350.56 per unit 8.745 0.000 0.005 GE Capital Asset Management
197 342.33 per unit 8.045 0.000 0.005 GE Capital Asset Management
198 25 per pad 8.885 0.000 0.005 GE Capital Asset Management
199 25 per pad 9.105 0.000 0.005 GE Capital Asset Management
200 200 per unit 8.445 0.000 0.005 GE Capital Asset Management
201 25 per pad 8.864 0.000 0.005 GE Capital Asset Management
202 25 per pad 8.025 0.000 0.005 GE Capital Asset Management
203 25 per pad 9.395 0.000 0.005 GE Capital Asset Management
204 25 per pad 9.125 0.000 0.005 GE Capital Asset Management
205 25 per pad 9.035 0.000 0.005 GE Capital Asset Management
207 273.08 per unit 9.035 0.000 0.005 GE Capital Asset Management
208 89.25 per pad 9.105 0.000 0.005 GE Capital Asset Management
209 0.15 per sq ft 8.835 0.000 0.005 GE Capital Asset Management
210 224.38 per unit 8.895 0.000 0.005 GE Capital Asset Management
211 275 per unit 9.225 0.000 0.005 GE Capital Asset Management
212 0.15 per sq ft 8.975 0.000 0.005 GE Capital Asset Management
213 0.15 per sq ft 8.945 0.000 0.005 GE Capital Asset Management
214 200 per unit 9.375 0.000 0.005 GE Capital Asset Management
215 0.04 %EGI 9.375 0.000 0.005 GE Capital Asset Management
(2) 216 25 per pad 8.675 0.000 0.005 GE Capital Asset Management
(2) 216
217 200 per unit 9.625 0.000 0.005 GE Capital Asset Management
218 0.2 per sq ft 9.725 0.000 0.005 GE Capital Asset Management
219 0.15 per sq ft 8.725 0.000 0.005 GE Capital Asset Management
220 200 per unit 9.305 0.000 0.005 GE Capital Asset Management
</TABLE>
- ---------------
(1) Servicing Fees consist of Sub-Servicing, Master Servicing, Special
Servicing and Trustee Fees.
(2) Control Number 216 Represent Two Mortgage Loan for One Property.
<PAGE>
EXHIBIT C
MLMI 1997-C1
Form of Schedule of Exceptions to Mortgage File Delivery
Control Borrower Document Document Exception
No. Name ID Status Description
- ------------- ---------------- -------------- ------------- ---------------
C-1
<PAGE>
EXHIBIT D-1
FORM OF MASTER SERVICER REQUEST FOR RELEASE
_________________ , 199_
LaSalle National Bank
135 LaSalle Street
Suite 1740
Chicago, Illinois 60674-4107
(Attention: MLMI Series 1997-C1)
Ladies and Gentlemen:
In connection with the administration of the Mortgage Files held by you as
Custodian under a certain Pooling and Servicing Agreement dated as of June 1,
1997 (the "Pooling and Servicing Agreement"), by and among Merrill Lynch
Mortgage Investors, Inc., as Depositor, GE Capital Asset Management Corporation,
as Master Servicer, GE Capital Realty Group, Inc. as Special Servicer, General
Electric Capital Corporation, ABN AMRO Bank N.V., as Fiscal Agent and you, as
Custodian, the undersigned hereby requests a release of the Mortgage File (or
the portion thereof specified below) held by you with respect to the following
described Mortgage Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
If only particular documents in the Mortgage File are requested, please specify
which:
Reason for requesting file (or portion thereof):
___________ 1. Mortgage Loan paid in full.
D-1-1
<PAGE>
The Master Servicer hereby certifies that all amounts
received in connection with the Mortgage Loan that are
required to be credited to the Certificate Account pursuant
to the Pooling and Servicing Agreement, have been or will
be so credited.
___________ 2. Other. (Describe)
The undersigned acknowledges that the above Mortgage File (or requested
portion thereof) will be held by the undersigned in accordance with the
provisions of the Pooling and Servicing Agreement and will be returned to you or
your designee within ten (10) days of our receipt thereof, unless the Mortgage
Loan has been paid in full, in which case the Mortgage File (or such portion
thereof) will be retained by us permanently.
D-1-2
<PAGE>
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
GE Capital Asset Management
Corporation,
as Master Servicer
By:_____________________________________
Name:
Title
D-1-3
<PAGE>
EXHIBIT D-2
FORM OF SPECIAL SERVICER REQUEST FOR RELEASE
________________ , 199_
LaSalle National Bank
135 LaSalle Street
Suite 1740
Chicago, Illinois 60674-4107
(Attention: MLMI Series 1997-C1)
Ladies and Gentlemen:
In connection with the administration of the Mortgage Files held by you as
Custodian under a certain Pooling and Servicing Agreement dated as of June 1,
1997 (the "Pooling and Servicing Agreement"), by and among Merrill Lynch
Mortgage Investors, Inc., as depositor, GE Capital Asset Management Corporation,
as Master Servicer and GE Capital Realty Group, Inc., as Special Servicer,
General Electric Capital Corporation, ABN AMRO Bank N.V., as Fiscal Agent and
you, as Custodian, the undersigned hereby requests a release of the Mortgage
File (or the portion thereof specified below) held by you with respect to the
following described Mortgage Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
If only particular documents in the Mortgage File are requested, please specify
which:
D-2-1
<PAGE>
Reason for requesting file (or portion thereof):
___________ 1. The Mortgage Loan is being foreclosed.
___________ 2. Other. (Describe)
The undersigned acknowledges that the above Mortgage File (or requested
portion thereof) will be held by the undersigned in accordance with the
provisions of the Pooling and Servicing Agreement and will be returned to you or
your designee within ten (10) days of our receipt thereof, unless the Mortgage
Loan is being foreclosed, in which case the Mortgage File (or such portion
thereof) will be returned when no longer required by us for such purpose.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
GE Capital Realty Group, Inc.,
as Special Servicer
By: _______________________________
Name:
Title:
D-2-2
<PAGE>
EXHIBIT E-1
CALCULATION OF NOI/DEBT SERVICE COVERAGE RATIOS
"Net Operating Income" shall mean the revenue derived from the use and
operation of a Mortgaged Property less operating expenses (such as utilities,
administrative expenses, repairs and maintenance, tenant improvement costs,
leasing commissions, management fees and advertising), fixed expenses (such as
insurance, real estate taxes and, if applicable, ground lease payments) and
reserves (such as reserves for tenant improvements and leasing commissions in
the case of Rental Properties and assumed reserves for ongoing capital
expenditures). Net cash flow does not reflect interest expenses and non-cash
items such as depreciation and amortization, and generally does not reflect
capital expenditures, but does reflect reserves for replacements.
In determining the "revenue" component of Net Operating Income for each
Rental Property, the Special Servicer shall rely on the most recent rent roll
supplied by the related borrower and where the actual vacancy shown thereon and
the market vacancy is less than 5%, the Special Servicer shall assume a 5%
vacancy in determining revenue from rents, except that in the case of certain
anchored shopping centers, space occupied by anchor tenants shall be disregarded
in performing the vacancy adjustment due to the length of the related leases or
creditworthiness of such tenants, in accordance with the respective Mortgage
Loan Seller's underwriting standards. In determining rental revenue for
multifamily properties, the Special Servicer shall either review rental revenue
shown on the rolling 12-month operating statements or annualize the rental
revenue shown on rent rolls or operating statements with respect to the prior
three to twelve month periods. For the other Rental Properties, the Special
Servicer shall annualize rental revenue shown on the most recent rent roll,
after applying the vacancy factor, without further regard to the terms
(including expiration dates) of the leases shown thereon. In the case of
hospitality properties, gross receipts shall be determined on the basis of
adjusted average daily occupancy shown on the borrower-supplied operating
statements. In the case of residential health care facilities, receipts shall be
based on historical occupancy levels, historical operating revenues and the then
current occupancy rates. Private occupancy rates shall be within current market
ranges and vacancy levels shall be at a minimum of 5%. In general, any
non-recurring items and non-property related revenue shall be eliminated from
the calculation except in the case of residential health care facilities.
E-1-1
<PAGE>
In determining the "expense" component of Net Operating Income for each
Mortgaged Property, the Special Servicer shall rely on the most recent financial
statements supplied by the related borrower, except that (a) if tax or insurance
expense information more current than that reflected in the financial statements
is available, the newer information shall be annualized and used, (b) with
respect to each Mortgaged Property, property management fees shall be assumed to
be 4% to 5% of effective gross revenue (except with respect to hospitality
properties, where a minimum of 4% of gross receipts shall be assumed, single
tenant properties, where a minimum of 2% of gross receipts shall be assumed and
self storage properties, where a minimum of 6% of gross receipts shall be
assumed) unless actual management fees are higher, in which case actual
management fees shall be assumed, (c) assumptions shall be made with respect to
reserves for leasing commission, tenant improvement expenses and capital
expenditures and (d) expenses shall be assumed to include annual replacement
reserves equal to (1) in the case of retail, office, and industrial properties,
not less than $0.10 and not more than $0.37 per square foot net rentable
commercial area, (2) in the case of multifamily and one mixed use
multifamily/retail properties, not less than $145 or more than $371 per
residential unit per year, depending on the condition of the property, (3) in
the case of hospitality properties, 4% of the gross revenues received by the
property owner on an ongoing basis or not less than $464 or more than $773 per
room, (4) in the case of residential healthcare facilities, $250 to $300 per bed
per year, (5) in the case of the mobile home parks, not less than $25 or more
than $90 per pad per year and (6) in the case of self storage facilities, not
less than $0.15 or more than $0.20 per square foot. In addition, in some
instances, the Special Servicer may recharacterize as capital expenditures those
items reported by borrowers as operating expenses (thus increasing "net
operating income") where determined appropriate.
E-1-2
<PAGE>
EXHIBIT E-2
FORM OF UPDATED MORTGAGE LOAN SCHEDULE
MERRILL LYNCH MORTGAGE PASS-THROUGH CERTIFICATES
Series 1997-C1
Payment Date:
Updated Mortgage Loan Schedule (Part 1 of 3)
- ------------------------------------------------------
Loan Property Loan
ID Name City State Type
- ------------------------------------------------------
0 XX XX XX 0
- ------------------------------------------------------------------------
At Closing
- ------------------------------------------------------------------------
Sched. Princ. Amort. Sched. Monthly
Balance Note Rate Term Term P+I Pymnt
- ------------------------------------------------------------------------
$0.00 0.00% 0 0 $0.00
- ------------------------------------------------------------------------
Current
- ------------------------------------------------------------------------
Sched. Princ. Amort. Sched. Monthly
Balance Note Rate Term Term P+I Pymnt
- ------------------------------------------------------------------------
$0.00 0.00% 0 0 $0.00
Loan Type Code: 01=Balloon Loan, 02=Fully Amortizing Loan, 03=Hyperamort. Loan
E-2-1
<PAGE>
MERRILL LYNCH MORTGAGE PASS-THROUGH CERTIFICATES
Series 1997-C1
Payment Date:
Updated Mortgage Loan Schedule (Part 2 of 3)
- --------------------------------------------------------------------------------
Property Property Total Total Replacement Capital
Loan ID Name Type Revenues Expenses Reserves Expenditures
- --------------------------------------------------------------------------------
0 XX 0 $0.00 $0.00 $0.00 $0.00
- --------------------------------------------------------------------------------
Leasing Tenant Date of Last Appraised
Commissions Improvements NOI Financial Stmnt DSCR Value
- --------------------------------------------------------------------------------
$0.00 $0.00 $0.00 00/00/00 0.00 $0.00
- --------------------------------------------------------------------------------
Appraised Appraised Occupancy Reserves at Reserves Loan Amt. Per
Date LTV % Closing Current sf., unit, bed
- --------------------------------------------------------------------------------
00/00/00 0.00 0.00% $0.00 $0.00 $0.00
Property Type Codes: 01=Industrial, 02=Mobile Home Park, 03=Hospitality,
04=Multifamily, 05=Office, 06=Self Storage, 07=Unanchored Retail,
08=Anchored Retail, 09=Health Care, 10=Mixed Use, 11=Other
E-2-2
<PAGE>
MERRILL LYNCH MORTGAGE PASS-THROUGH CERTIFICATES
Series 1997-C1
Payment Date:
Updated Mortgage Loan Schedule (Part 3 of 3)
<TABLE>
<CAPTION>
- --------------------------------------------------
Property Current Loan Payoff
Loan ID Name Status Date
- --------------------------------------------------
<S> <C> <C> <C>
0 XX 0 00/00/00
<CAPTION>
- -------------------------------------------------------------------------------------------------
Performance History
- -------------------------------------------------------------------------------------------------
Number of Times Since Closing
- -------------------------------------------------------------------------------------------------
30-59 days 60-89 days Special Workout/ Modified
Delinq. Delinq. Serviced Modified Date Foreclosure Bankruptcy REO
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
0 0 0 0 00/00/00 0 0 0
</TABLE>
Current Loan Status Code: 01=Specially Serviced, 02=In Process of Foreclosure,
03=Bankruptcy, 04=REO, 05=Prepaid in Full, 06=DPO
07=Foreclosure Sale, 08=Bankruptcy Sale,
09=REO Disposition, 10=Modification/Workout
E-2-3
<PAGE>
EXHIBIT F-1
FORM OF TRANSFEROR CERTIFICATE
_______________ __, 199_
LaSalle National Bank
[Address]
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1,
Class the "Certificates")
------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the
transfer by ____________________ (the "Transferor") to _______________________
(the "Transferee") of a Certificate (the "Transferred Certificate") [having an
initial principal balance as of June __, 1997 (the "Closing Date") of
$_____________] [evidencing a __% percentage interest in the Class to which it
belongs]. The Certificates were issued pursuant to the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June 1, 1997,
among Merrill Lynch Mortgage Investors, Inc., as depositor, GE Capital Asset
Management Corporation, as master servicer, GE Capital Realty Group, Inc., as
special servicer, General Electric Capital Corporation, LaSalle National Bank,
as trustee and ABN AMRO Bank N.V., as fiscal agent. All terms used herein and
not otherwise defined shall have the meanings set forth in the Pooling and
Servicing Agreement. The Transferor hereby certifies, represents and warrants to
you, as Certificate Registrar, that:
1. The Transferor is the lawful owner of the Transferred Certificate
with the full right to transfer such Certificate free from any and all
claims and encumbrances whatsoever.
2. Neither the Transferor nor anyone acting on its behalf has (a)
offered, transferred, pledged, sold or otherwise disposed of any
Certificate, any interest in any Certificate or any other similar security
to any person in any manner, (b) solicited any offer to buy or accepted a
transfer, pledge or other disposition of any Certificate, any interest in
any Certificate or any other similar security from any person in any
manner, (c) otherwise approached or negotiated with respect to any
Certificate, any interest in any Certificate or any other similar
F-1-1
<PAGE>
security with any person in any manner, (d) made any general solicitation
by means of general advertising or in any other manner, or (e) taken any
other action, which (in the case of any of the acts described in clauses
(a) through (e) hereof) would constitute a distribution of any Certificate
under the
F-1-2
<PAGE>
Securities Act of 1933 (the "Securities Act"), or would render the
disposition of any Certificate a violation of Section 5 of the Securities
Act or any state securities laws, or would require registration or
qualification of any Certificate pursuant to the Securities Act or any
state securities laws.
Very truly yours,
------------------------------
(Transferor)
By:___________________________
Name:_________________________
Title:________________________
F-1-3
<PAGE>
EXHIBIT F-2
FORM OF TRANSFEREE CERTIFICATE
FOR QIBs
________________ __, 199_
LaSalle National Bank
[Address]
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1,
Class (the "Certificates")
------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the
transfer by ____________________ (the "Transferor") to _______________________
(the "Transferee") of a Certificate (the "Transferred Certificate") [having an
initial principal balance as of June __, 1997 (the "Closing Date") of
$_____________] [evidencing a __% percentage interest in the Class to which it
belongs]. The Certificates were issued pursuant to the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June 1, 1997,
among Merrill Lynch Mortgage Investors, Inc., as depositor, GE Capital Asset
Management Corporation, as master servicer, GE Capital Realty Group, Inc., as
special servicer, General Electric Capital Corporation, and LaSalle National
Bank, as trustee and ABN AMRO Bank, N.V., as fiscal agent. All terms used herein
and not otherwise defined shall have the meanings set forth in the Pooling and
Servicing Agreement. The Transferee hereby certifies, represents and warrants to
you, as Certificate Registrar, that:
1. The Transferee is a "qualified institutional buyer" as that term
is defined in Rule 144A ("Rule 144A") under the Securities Act of 1933
(the "Securities Act") and has completed one of the forms of certification
to that effect attached hereto as Annex 1 and Annex 2. The Transferee is
aware that the sale to it is being made in reliance on Rule 144A. The
Transferee is acquiring the Transferred Certificate for its own account or
for the account of a qualified institutional buyer, and understands that
such Certificate may be resold, pledged or transferred only (i) to a
person reasonably believed to be a qualified institutional buyer that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that the resale, pledge or
transfer is being
F-2-1
<PAGE>
made in reliance on Rule 144A, or (ii) pursuant to another exemption from
registration under the Securities Act.
2. The Transferee has been furnished with all information regarding
(a) the Certificates and distributions thereon, (b) the nature,
performance and servicing of the Mortgage Loans, (c) the Pooling and
Servicing Agreement, and (d) any credit enhancement mechanism associated
with the Certificates, that it has requested.
Very truly yours,
------------------------------
(Transferee)
By:___________________________
Name:_________________________
Title:________________________
F-2-2
<PAGE>
ANNEX 1 TO EXHIBIT B-3
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor] (the
"Transferor") and LaSalle National Bank, as Certificate Registrar, with respect
to the mortgage pass-through certificate being transferred (the "Transferred
Certificate") as described in the Transferee Certificate to which this
certification relates and to which this certification is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificate (the "Transferee").
2. The Transferee is a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act of 1933 ("Rule 144A") because (i)
the Transferee owned and/or invested on a discretionary basis $_______________/
_______________ in securities (other than the excluded securities referred to
below) as of the end of the Transferee's most recent fiscal year (such amount
being calculated in accordance with Rule 144A) [Transferee must own and/or
invest on a discretionary basis at least $100,000,000 in securities unless
Transferee is a dealer, and, in that case, Transferee must own and/or invest on,
a discretionary basis at least $10,000,000 in securities.] and (ii) the
Transferee satisfies the criteria in the category marked below.
o Corporation, etc. The Transferee is a corporation (other than a
bank, savings and loan association or similar institution), business
trust, partnership, or any organization described in Section
501(c)(3) of the Internal Revenue Code of 1986.
o Bank. The Transferee (a) is a national bank or a banking
institution organized under the laws of any State, U.S. territory
or the District of Columbia, the business of which is
substantially confined to banking and is supervised by the State
or territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (b) has an audited
net worth of at least $25,000,000 as demonstrated in its latest
annual financial statements, a copy of which is attached hereto,
as of a date not more than 16 months preceding the date of sale
of the Certificate in the case of a U.S. bank, and not more than
18 months preceding such date of sale for a foreign bank or
equivalent institution.
F-2-3
<PAGE>
o Savings and Loan. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision
over any such institutions or is a foreign savings and loan
association or equivalent institution and (b) has an audited net
worth of at least $25,000,000 as demonstrated in its latest
annual financial statements, a copy of which is attached hereto,
as of a date not more than 16 months preceding the date of sale
of the Certificate in the case of a U.S. savings and loan
association, and not more than 18 months preceding such date of
sale for a foreign savings and loan association or equivalent
institution.
o Broker-dealer. The Transferee is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
o Insurance Company. The Transferee is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State, U.S.
territory or the District of Columbia.
o State or Local Plan. The Transferee is a plan established and
maintained by a State, its political subdivisions, or any agency
or instrumentality of the State or its political subdivisions,
for the benefit of its employees.
o ERISA Plan. The Transferee is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
Investment Advisor. The Transferee is an investment advisor
registered under the Investment Advisers Act of 1940.
o Other. (Please supply a brief description of the entity and a
cross-reference to the paragraph and subparagraph under subsection
(a)(1) of Rule 144A pursuant to which it qualifies. Note that
registered investment companies should complete Annex 2 rather than
this Annex 1.) ____________________________________________________
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the
F-2-4
<PAGE>
Transferee, (ii) securities that are part of an unsold allotment to or
subscription by the Transferee, if the Transferee is a dealer, (iii) bank
deposit notes and certificates of deposit, (iv) loan participations, (v)
repurchase agreements, (vi) securities owned but subject to a repurchase
agreement and (vii) currency, interest rate and commodity swaps. For purposes of
determining the aggregate amount of securities owned and/or invested on a
discretionary basis by the Transferee, the Transferee did not include any of the
securities referred to in this paragraph.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Transferee, the Transferee used
the cost of such securities to the Transferee, unless the Transferee reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities were valued at market. Further,
in determining such aggregate amount, the Transferee may have included
securities owned by subsidiaries of the Transferee, but only if such
subsidiaries are consolidated with the Transferee in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Transferee's direction.
However, such securities were not included if the Transferee is a
majority-owned, consolidated subsidiary of another enterprise and the Transferee
is not itself a reporting company under the Securities Exchange Act of 1934.
5. The Transferee acknowledges that it is familiar with Rule 144A and
understands that the parties to which this certification is being made are
relying and will continue to rely on the statements made herein because one or
more sales to the Transferee may be in reliance on Rule 144A.
---- ---- Will the Transferee be purchasing the
Yes No Transferred Certificate only for the
Transferee's own account?
6. If the answer to the foregoing question is "no", then in each case
where the Transferee is purchasing for an account other than its own, such
account belongs to a third party that is itself a "qualified institutional
buyer" within the meaning of Rule 144A, and the "qualified institutional buyer"
status of such third party has been established by the Transferee through one or
more of the appropriate methods contemplated by Rule 144A.
7. The Transferee will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Transferee's purchase of the Transferred
Certificate will constitute a
F-2-5
<PAGE>
reaffirmation of this certification as of the date of such purchase. In
addition, if the Transferee is a bank or savings and loan as provided above, the
Transferee agrees that it will furnish to such parties any updated annual
financial statements that become available on or before the date of such
purchase, promptly after they become available.
------------------------
Print Name of Transferee
By: ____________________________________
Name: ____________________________________
Title: ____________________________________
____________________________________
Date: ____________________________________
F-2-6
<PAGE>
ANNEX 2 TO EXHIBIT B-3
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor] (the
"Transferor") and LaSalle National Bank, as Certificate Registrar, with respect
to the mortgage pass-through certificate being transferred (the "Transferred
Certificate") as described in the Transferee Certificate to which this
certification relates and to which this certification is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificate (the "Transferee") or, if the
Transferee is a "qualified institutional buyer" as that term is defined in Rule
144A under the Securities Act of 1933 ("Rule 144A") because the Transferee is
part of a Family of Investment Companies (as defined below), is an executive
officer of the investment adviser (the "Adviser").
2. The Transferee is a "qualified institutional buyer" as defined in Rule
144A because (i) the Transferee is an investment company registered under the
Investment Company Act of 1940, and (ii) as marked below, the Transferee alone
owned and/or invested on a discretionary basis, or the Transferee's Family of
Investment Companies owned, at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Transferee's most
recent fiscal year. For purposes of determining the amount of securities owned
by the Transferee or the Transferee's Family of Investment Companies, the cost
of such securities was used, unless the Transferee or any member of the
Transferee's Family of Investment Companies, as the case may be, reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities of such entity were valued at
market.
o The Transferee owned and/or invested on a discretionary basis
$________________ in securities (other than the excluded securities
referred to below) as of the end of the Transferee's most recent
fiscal year (such amount being calculated in accordance with
Rule 144A).
o The Transferee is part of a Family of Investment Companies which
owned in the aggregate $_________________ in securities (other than
the excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
F-2-7
<PAGE>
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Transferee or are part of the Transferee's
Family of Investment Companies, (ii) bank deposit notes and certificates of
deposit, (iii) loan participations, (iv) repurchase agreements, (v) securities
owned but subject to a repurchase agreement and (vi) currency, interest rate and
commodity swaps. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Transferee, or owned by
the Transferee's Family of Investment Companies, the securities referred to in
this paragraph were excluded.
5. The Transferee is familiar with Rule 144A and understands that the
parties to which this certification is being made are relying and will continue
to rely on the statements made herein because one or more sales to the
Transferee will be in reliance on Rule 144A.
---- ---- Will the Transferee be purchasing the
Yes No Transferred Certificate only for the
Transferee's own account?
6. If the answer to the foregoing question is "no", then in each case
where the Transferee is purchasing for an account other than its own, such
account belongs to a third party that is itself a "qualified institutional
buyer" within the meaning of Rule 144A, and the "qualified institutional buyer"
status of such third party has been established by the Transferee through one or
more of the appropriate methods contemplated by Rule 144A.
[REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
F-2-8
<PAGE>
7. The undersigned will notify the parties to which this certification is
made of any changes in the information and conclusions herein. Until such
notice, the Transferee's purchase of the Transferred Certificate will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.
-----------------------------------
Print Name of Transferee or Adviser
-----------------------------------
By: _______________________________
Name: _____________________________
Title: ____________________________
IF AN ADVISER:
-----------------------------------
Print Name of Transferee
Date: _____________________________
F-2-9
<PAGE>
EXHIBIT F-3
FORM OF TRANSFEREE CERTIFICATE
FOR non-QIBs
_________________ __, 199_
LaSalle National Bank
135 LaSalle Street
Suite 1740
Chicago, Illinois 60674-4107
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificate, Series 1997-C1,
Class (the "Certificates")
------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
____________________ by (the "Transferor") to _______________________ (the
"Transferee") of a Certificate (the "Transferred Certificate") [having an
initial principal balance as of June __, 1997 (the "Closing Date") of
$_____________] [evidencing a __% percentage interest in the Class to which it
belongs]. The Certificates were issued pursuant to the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June __, 1997,
among Merrill Lynch Mortgage Investors, Inc., as depositor (the "Depositor"), GE
Capital Asset Management Corporation, as master servicer, GE Capital Realty
Group, Inc., as special servicer, General Electric Capital Corporation, LaSalle
National Bank, as trustee and ABN AMRO Bank, N.V., as fiscal agent. All terms
used herein and not otherwise defined shall have the meanings set forth in the
Pooling and Servicing Agreement. The Transferee hereby certifies, represents and
warrants to you, as Certificate Registrar, that:
1. The Transferee is acquiring the Transferred Certificate for its own
account for investment and not with a view to or for sale or transfer in
connection with any distribution thereof, in whole or in part, in any manner
which would violate the Securities Act of 1933, as amended (the "Securities
Act"), or any applicable state securities laws.
2. The Transferee understands that (a) the Certificates have not been and
will not be registered under the Securities Act or registered or qualified under
any applicable state securities laws, (b) neither the Depositor nor the Trustee
is obligated so to register or qualify the Certificates and (c) the Certificates
may not be resold or transferred unless they are
F-3-1
<PAGE>
(i) registered pursuant to the Securities Act and registered or qualified
pursuant to any applicable state securities laws or (ii) sold or transferred in
transactions which are exempt from such registration and qualification and the
Certificate Registrar has received either (A) certifications from both the
transferor and the transferee (substantially in the forms attached to the
Pooling and Servicing Agreement) setting forth the facts surrounding the
transfer or (B) an opinion of counsel satisfactory to the Certificate Registrar
with respect to the availability of such exemption, together with copies of the
certification(s) from the Transferor and/or Transferee setting forth the facts
surrounding the transfer upon which such opinion is based.
3. The Transferee understands that it may not sell or otherwise transfer
any portion of its interest in the Transferred Certificate except in compliance
with the provisions of Section 5.02 of the Pooling and Servicing Agreement,
which provisions it has carefully reviewed, and that the Transferred Certificate
will bear legends substantially to the following effect:
THE CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION
WHICH DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH
THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
- AND -
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986
(THE "CODE"), OR TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS
CERTIFICATE ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS
OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, WILL BE
REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
4. Neither the Transferee nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred any Certificate, any
interest in any Certificate or any other similar security to any person in any
manner, (b) solicited any offer to buy or accept a pledge, disposition or other
transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate or
any other similar security with any person in any manner, (d) made any general
solicitation by means of general advertising or in any other manner, or (e)
taken any other action, that (in the case of
F-3-2
<PAGE>
any of the acts described in clauses (a) through (e) above) would constitute a
distribution of any Certificate under the Securities Act, would render the
disposition of any Certificate a violation of Section 5 of the Securities Act or
any state securities law or would require registration or qualification of any
Certificate pursuant thereto. The Transferee will not act, nor has it authorized
or will it authorize any person to act, in any manner set forth in the foregoing
sentence with respect to any Certificate.
5. The Transferee has been furnished with all information regarding (a) the
Depositor, (b) the Certificates and distributions thereon, (c) the Pooling and
Servicing Agreement, and (d) all related matters, that it has requested.
6. The Transferee is an "accredited investor" as defined in Rule 501(a)(1),
(2), (3), (7) or (8) under the Securities Act and has such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of an investment in the Certificates; the Transferee has sought
such accounting, legal and tax advice as it has considered necessary to make an
informed investment decision; and the Transferee is able to bear the economic
risks of such an investment and can afford a complete loss of such investment.
Very truly yours,
------------------------------
(Transferee)
By:___________________________
Name:_________________________
Title:________________________
F-3-3
<PAGE>
EXHIBIT G
FORM OF TRANSFEREE LETTER
FOR TRANSFERS OF SUBORDINATED CERTIFICATES
TO NON-PLAN ENTITIES
________________ __, 199_
LaSalle National Bank
135 LaSalle Street
Suite 1740
Chicago, Illinois 60674-4107
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1,
Classes (the "Certificates")
------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
____________________ (the "Transferor") to _______________________ (the
"Transferee") of the Class ______________ Certificates (the "Transferred
Certificate") (having principal balances as of June __, 1997 (the "Closing
Date") of $_____________ evidencing a __% interest in the Classes to which they
belong]. The Certificates were issued pursuant to a Pooling and Servicing
Agreement, dated as of June 1, 1997 (the "Pooling and Servicing Agreement"),
among Merrill Lynch Mortgage Investors, Inc., as depositor, GE Capital Asset
Management Corporation, as master servicer, GE Capital Realty Group, Inc., as
special servicer, General Electric Capital Corporation, ABN AMRO Bank N.V., as
fiscal agent and LaSalle National Bank, as trustee (the "Trustee"). Capitalized
terms used but not defined herein shall have the meanings set forth in the
Pooling and Servicing Agreement. The Transferee hereby certifies, represents and
warrants to you that the Transferee is not an employee benefit plan within the
meaning of section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA") (a "Plan"), or a plan within the meaning of section
4975(e)(1) of the Internal Revenue Code of 1986, as amended (the "Code") (also,
a "Plan"), and the Transferee is not directly or indirectly purchasing the
Transferred Certificate on behalf of, as investment manager of, as named
fiduciary of, as trustee of, or with assets of a Plan (including any insurance
company using assets in its general or separate account that may constitute
assets of a Plan).
G-1
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this certificate as of the
date first written above.
[Name of Transferee]
By:___________________________
Name:_________________________
Title:________________________
G-2
<PAGE>
EXHIBIT H-1
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
PURSUANT TO SECTION 5.02(d)(i)(B)
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
[NAME OF OFFICER], being first duly sworn, deposes, and represents and
warrants:
1. That he is a [Title of Officer] of [Name of Owner] (the "Owner"), a
corporation duly organized and existing under the laws of the [State of
___________] [the United States], and the owner of the Merrill Lynch
Mortgage Investors, Inc., Mortgage Pass-Through Certificates, Series
1997-C1, Class [R-I, R-II, R-III] evidencing a ___% Percentage Interest
(the "Class [R-I, R-II, R-III] Certificates"). Capitalized terms used but
not defined herein have the meanings assigned to such terms in the Pooling
and Servicing Agreement dated as of June 1, 1997, among Merrill Lynch
Mortgage Investors, Inc., as Depositor, GE Capital Asset Management
Corporation as Master Servicer, GE Capital Realty Group, Inc., as Special
Servicer, General Electric Capital Corporation, ABN AMRO Bank N.V., as
Fiscal Agent and LaSalle National Bank, as Trustee.
2. That the Owner (i) is and will be a "Permitted Transferee" as of
______________, 199_ and (ii) is acquiring the Class [R-I, R-II, R-III]
Certificates for its own account or for the account of another Owner from
which it has received an affidavit in substantially the same form as this
affidavit. A "Permitted Transferee" is any person other than a
"disqualified organization" or a Non-United States Person. For this
purpose, a "disqualified organization" means any of the following: (i) the
United States, any State or political subdivision thereof, any possession
of the United States, or any agency or instrumentality of any of the
foregoing (other than an instrumentality which is a corporation if all of
its activities are subject to tax and, except of the FHLMC, a majority of
its board of directors is not selected by such governmental unit), (ii) a
foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which
is exempt from the tax imposed by Chapter 1 of the Code (unless such
organization is subject to the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural
H-1-1
<PAGE>
electric and telephone cooperatives described in Section 1381(a)(2)(C) of
the Code and (v) any other Person so designated by the Trustee based upon
an Opinion of Counsel that the holding of an Ownership Interest in a Class
[R-I, R-II, R-III] Certificate by such Person may cause the Trust Fund or
any Person having an Ownership Interest in any Class of Certificates, other
than such Person, to incur a liability for any federal tax imposed under
the Code that would not otherwise be imposed but for the Transfer of an
Ownership Interest in a Class [R-I, R-II, R-III] Certificate to such
Person. The terms "United States", "State" and "international organization"
shall have the meanings set forth in Section 7701 of the Code or successor
provisions.
A "Non-United States Person" is any Person other than a United States
Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in,
or under the laws of, the United States or any political subdivision
thereof, or an estate or trust 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.
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of the Class [R-I, R-II, R-III] Certificates to disqualified
organizations under the Internal Revenue Code of 1986 that applies to all
transfers of the Class [R-I, R-II, R-III] Certificates after March 31,
1988; (ii) that such tax would be on the transferor, or, if such transfer
is through an agent (which person includes a broker, nominee or middleman)
for a disqualified organization Transferee, on the agent; (iii) that the
person otherwise liable for the tax shall be relieved of liability for the
tax if the transferee furnishes to such person an affidavit that the
transferee is not a disqualified organization and, at the time of transfer,
such person does not have actual knowledge that the affidavit is false; and
(iv) that the Class [R-I, R-II, R-III] Certificates may be "noneconomic
residual interests" within the meaning of Treasury regulation section
1.860E-I(c)(2) and that the transferor of a "noneconomic residual interest"
will remain liable for any taxes due with respect to the income on such
residual interest, unless no significant purpose of the transfer is to
enable the transferor to impede the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding the Class [R-I, R-II, R-III] Certificates if at any time
during the taxable year of the pass-through entity a non-Permitted
Transferee is the record holder of an interest in such entity. For this
purpose, a "pass through entity" includes a regulated investment
H-1-2
<PAGE>
company, a real estate investment trust or common trust fund, a
partnership, trust or estate, and certain cooperatives.
5. That the Owner is aware that the Certificate Registrar will not
register the transfer of any Class [R-I, R-II, R-III] Certificate unless
the transferee, or the transferee's agent, delivers to the Trustee, among
other things, an affidavit in substantially the same form as this
affidavit. The Owner expressly agrees that it will not consummate any such
transfer if it knows or believes that any of the representations contained
in such affidavit and agreement are false.
6. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to
constitute a reasonable arrangement to ensure that the Class [R-I, R-II,
R-III] Certificates will only be owned, directly or indirectly, by
Permitted Transferees.
7. That the Owner's taxpayer identification number is _____________.
8. That the Owner has reviewed the restrictions set forth on the face
of the Class [R-I, R-II, R-III] Certificates and the provisions of Section
5.02 of the Pooling and Servicing Agreement under which the Class [R-I,
R-II, R-III] Certificates were issued (and, in particular, the Owner is
aware that such Section authorizes the Trustee to deliver payments to a
person other than the Owner and negotiate a mandatory sale by the Trustee
in the event that the Owner holds such Certificate in violation of Section
5.02); and that the Owner expressly agrees to be bound by and to comply
with such restrictions and provisions.
9. That the Owner is not acquiring and will not transfer the Class
[R-I, R-II, R-III] Certificates in order to impede the assessment or
collection of any tax.
10. That the Owner anticipates that it will, so long as it holds any
of the Class [R-I, R-II, R-III] Certificates, have sufficient assets to pay
any taxes owed by the holder of such Class [R-I, R-II, R-III] Certificates.
11. That the Owner has no present knowledge that it may become
insolvent or subject to a bankruptcy proceeding for so long as it holds any
of the Class [R-I, R-II, R-III] Certificates.
12. That the Owner has no present knowledge or expectation that it
will be unable to pay any United States taxes owed by it so long as any of
the Certificates remain outstanding. In this regard, the Owner hereby
represents to
H-1-3
<PAGE>
and for the benefit of the Person from whom it acquired the Class [R-I,
R-II, R-III] Certificates that the Owner intends to pay taxes associated
with holding the Class [R-I, R-II, R-III] Certificates as they become due,
fully understanding that it may incur tax liabilities in excess of any cash
flows generated by the Class [R-I, R-II, R-III] Certificates.
13. That the Owner is not acquiring the Class [R-I, R-II, R-III]
Certificates with the intent to transfer any of the Class [R-I, R-II,
R-III] Certificates to any person or entity that will not have sufficient
assets to pay any taxes owed by the holder of such Class [R-I, R-II, R-III]
Certificates, or that may become insolvent or subject to a bankruptcy
proceeding, for so long as the Class [R-I, R-II, R-III] Certificates remain
outstanding.
14. That Owner will, in connection with any transfer that it makes of
the Class [R-I, R-II, R-III] Certificates, obtain from its transferee the
representations required by Section 5.02(d) of the Pooling and Servicing
Agreement under which the Class [R-I, R-II, R-III] Certificates were issued
and will not consummate any such transfer if it knows, or knows facts that
should lead it to believe, that any such representations are false.
15. That Owner will, in connection with any transfer that it makes of
any Class [R-I, R-II, R-III] Certificate, deliver to the Certificate
Registrar an affidavit, which represents and warrants that it is not
transferring such Class [R-I, R-II, R-III] Certificate to impede the
assessment or collection of any tax and that it has no actual knowledge
that the proposed transferee: (i) has insufficient assets to pay any taxes
owed by such transferee as holder of such Class [R-I, R-II, R-III]
Certificate; (ii) may become insolvent or subject to a bankruptcy
proceeding, for so long as the Class [R-I, R-II, R-III] Certificates remain
outstanding; and (iii) is not a "Permitted Transferee".
H-1-4
<PAGE>
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on
its behalf, by its [Title of Officer] and Authorized Signatory, attested by its
Assistant Secretary, this ____ day of _____, 199_.
[NAME OF OWNER]
By:________________________________
[Name of Officer]
[Title of Officer]
- -------------------------------
[Assistant] Secretary
Personally appeared before me the above-named [Name of Officer], known or
proved to me to be the same person who executed the foregoing instrument and to
be [Title of Officer], and acknowledged to me that he executed the same as his
free act and deed and the free act and deed of the Owner.
Subscribed and sworn before me this ____ day of _____ 199_.
/s/
--------------------------------------
NOTARY PUBLIC
COUNTY OF ____________________
STATE OF _____________________
My Commission expires the
____ day of _____________, 19__.
H-1-5
<PAGE>
EXHIBIT H-2
FORM OF TRANSFEROR CERTIFICATE
PURSUANT TO SECTION 5.02(d)(i)(D)
__________________ , 199_
LaSalle National Bank
135 LaSalle Street
Suite 1740
Chicago, Illinois 60674-4107
(Attention: MLMI Series 1997-C1)
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1, Class [R-I, R-II,
R-III], evidencing a ____% percentage interest in the Class to
which they belong
--------------------------------------------------------------
Dear Sirs:
This letter is delivered to you in connection with the transfer by
_________________ (the "Transferor") to _________________ (the "Transferees") of
the captioned Class [R-I, R-II, R-III] Certificates (the "Class [R-I, R-II,
R-III] Certificates"), pursuant to Section 5.02 of the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June 1, 1997,
among Merrill Lynch Mortgage Investors, Inc., as depositor, GE Capital Asset
Management Corporation, as master servicer, GE Capital Realty Group, Inc., as
special servicer, General Electric Capital Corporation, ABN AMRO Bank N.V., as
fiscal agent and LaSalle National Bank, as trustee. All terms used herein and
not otherwise defined shall have the meanings set forth in the Pooling and
Servicing Agreement. The Transferor hereby represents and warrants to you, as
Certificate Registrar, that:
H-2-1
<PAGE>
1. No purpose of the Transferor relating to the transfer of the
Class [R-I, R-II, R-III] Certificates by the Transferor to the Transferee
is or will be to impede the assessment or collection of any tax.
2. The Transferor understands that the Transferee has delivered to
you a Transfer Affidavit and Agreement in the form attached to the Pooling
and Servicing Agreement as Exhibit I-1. The Transferor does not know or
believe that any representation contained therein is false.
3. The Transferor has at the time of this transfer conducted a
reasonable investigation of the financial condition of the Transferee as
contemplated by Treasury regulation section 1.860E-1(c)(4)(i) and, as a
result of that investigation, the Transferor has determined that the
Transferee has historically paid its debts as they became due and has
found no significant evidence to indicate that the Transferee will not
continue to pay its debts as they become due in the future. The Transferor
understands that the transfer of the Class [R-I, R-II, R-III] Certificates
may not be respected for United States income tax purposes (and the
Transferor may continue to be liable for United States income taxes
associated therewith) unless the Transferor has conducted such an
investigation.
Very truly yours,
By:______________________________
Name:
Title:
H-2-2
<PAGE>
Exhibit I-1
FORM OF NOTICE AND ACKNOWLEDGMENT
____________________ , 199_
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Fitch Investors Service, L.P.
One State Street Plaza
New York, New York 10004
Standard & Poor's Ratings Agency
25 Broadway
New York, New York 10004
Ladies and Gentlemen:
This notice is being delivered pursuant to Section 6.09 of the Pooling and
Servicing Agreement dated as of June 1, 1997 relating to Merrill Lynch Mortgage
Investors Inc., Mortgage Pass-Through Certificates, Series 1997-C1 (the
"Agreement"). Any term with initial capital letters not otherwise defined in
this notice has the meaning given such term in the Agreement.
Notice is hereby given that the Holders of Certificates evidencing a
majority of the Voting Rights allocated to the Controlling Class have designated
___________________ to serve as the Special Servicer under the Agreement.
The designation of ____________________ as Special Servicer will become
final if certain conditions are met and if neither of you delivers to LaSalle
National Bank, the trustee under the Agreement (the "Trustee"), within 45 days
after the date of the delivery of this notice to you, a written notice stating
that if the person designated to become the Special Servicer were to serve as
the Special Servicer, then the rating or ratings of one or more Classes of the
Certificates would be qualified, downgraded or withdrawn.
I-1-1
<PAGE>
Please acknowledge receipt of this notice by signing the enclosed copy of
this notice where indicated below and returning it to the Trustee, in the
enclosed stamped self-addressed envelope.
Very truly yours,
LaSalle National Bank
By: ______________________________
Title: ____________________________
I-1-2
<PAGE>
Receipt acknowledged:
Fitch Investors Standard & Poor's Moody's Investors
Service, L.P. Ratings Agency Service, Inc.
By:_________________ By:_________________ By:_________________
Title:______________ Title:______________ Title:______________
Date:_______________ Date:_______________ Date:_______________
I-1-3
<PAGE>
EXHIBIT I-2
FORM OF ACKNOWLEDGMENT OF PROPOSED SPECIAL SERVICER
__________________ , 199_
LaSalle National Bank
135 LaSalle Street
Suite 1740
Chicago, Illinois 60674-4107
Attention: MLMI Series 1997-C1
Ladies & Gentlemen:
Pursuant to Section 6.09 of the Pooling and Servicing Agreement dated as
of June 1, 1997 relating to Merrill Lynch Mortgage Investors Inc., Mortgage
Pass-Through Certificates, Series 1997-C1 (the "Agreement"), the undersigned
hereby agrees with all the other parties to the Agreement that the undersigned
shall serve as Special Servicer under, and as defined in, the Agreement. The
undersigned hereby acknowledges that, as of the date hereof, it is and shall be
a party to the Agreement and bound thereby to the full extent indicated therein
in the capacity of Special Servicer. The undersigned hereby makes, as of the
date hereof, the representations and warranties set forth in Section 3.23(b) as
if it were the Special Servicer thereunder.
______________________________
By: __________________________
Name: ________________________
Title: _______________________
I-2-1
<PAGE>
EXHIBIT J
Uniform Commercial Code - FINANCING STATEMENT - Form UCC-1
Important - Read instructions on back before filling out form
This FINANCING STATEMENT is No. of Additional 3.[ ] The Debtor is a
presented to a Filing Officer Sheets Prepared: transmitting facility
for filing pursuant to the
Uniform Commercial Code
- --------------------------------------------------------------------------------
1. Debtor(s) (Last Name 2. Secured Party(ies) 4.[ ] For Filing Officer:
First) and Address(es): Name(s) and Date, Time, No.
Address(es) Filing Office
- --------------------------------------------------------------------------------
5. This Financing Statement covers the following 6.[ ] Assignee(s) of
types (or items) of property: Secured Party and
Address(es)
7.[ ] The described crops
are growing or to be
grown on:*
[ ] The described
goods are or are to
be affixed to:*
[ ] The lumber to be
cut or minerals or
the like (including
oil and gas) is on:*
*(Describe Real
Estate Below)
[ ] Products of the Collateral are also covered.
- -------------------------------------------------------
8. Describe Real [ ] This statement 9. Name of a
Estate Here: is to be Record
indexed in the Owner
Real Estate
Records:
No. & Street Town or City County Section Block Lot
- --------------------------------------------------------------------------------
10. This statement is filed without the debtor's signature to perfect a
security interest in collateral (check appropriate box)
[ ] under a security agreement signed by debtor authorizing secured party to
file this statement, or
[ ] which is proceeds of the original collateral described above in which a
security interest was perfected, or
[ ] acquired after a change of name, identity of corporate structure of the
debtor, or
[ ] as to which the filing has lapsed, or already subject to a security
interest in another jurisdiction:
[ ] when the collateral was brought into the state, or [ ] when the debtor's
location was changed to this state.
- --------------------------------------- --------------------------------------
By ____________________________________ By ___________________________________
Signature(s) of Debtor(s) Signature(s) of Secured Party(ies)
(1) Filing Officer Copy-Numerical
J-1
<PAGE>
Standard Form - Form UCC-1 - Approved by Secretary of State of New York
J-2
<PAGE>
EXHIBIT A
This Exhibit A is attached to and incorporated in a financing statement
pertaining to MERRILL LYNCH MORTGAGE INVESTORS, INC., as Depositor (referred to
as the "Debtor" for the purpose of this financing statement only), and LaSalle
National Bank, as trustee for the holders of the Series 1997-C1 Certificates
(referred to as the "Secured Party" for purposes of this financing statement
only), under that certain Pooling and Servicing Agreement dated as of June 1,
1997 (the "Pooling and Servicing Agreement"), among the Debtor, GE Capital Asset
Management Corporation, as master servicer (in such capacity, the "Master
Servicer"), GE Capital Realty Group, Inc., as special servicer (in such
capacity, the "Special Servicer"), General Electric Capital Corporation, ABN
AMRO Bank N.V., as fiscal agent (in such capacity, the "Fiscal Agent") and the
Secured Party, relating to the issuance of the Debtor's Mortgage Pass-Through
Certificates, Class A-1, Class A-2, Class A-3, Class IO, Class B, Class C, Class
D, Class E, Class F, Class G, Class H, Class J, Class R-I, Class R-II and Class
R-III Series 1997-C1 (collectively, the "Series 1997-C1 Certificates").
Capitalized terms used herein and not defined shall have the respective meanings
given to them in the Pooling and Servicing Agreement. The attached financial
statement covers all of the Debtor's right (including the power to convey title
thereto), title and interest in and to the Trust Fund created by the Pooling and
Servicing Agreement, consisting of the following:
1. The mortgage notes or other evidence of indebtedness of a borrower
(the "Mortgage Notes") with respect to the mortgage loans (the "Mortgage
Loans") listed on the Mortgage Loan Schedule to the Pooling and Servicing
Agreement, which Mortgage Loan Schedule is attached hereto as Exhibit C;
2. The related mortgages, deeds of trust or other similar instruments
securing such Mortgage Notes (the "Mortgages");
3. With respect to each Mortgage Note and each Mortgage, each other
document in the related Mortgage File;
4. (a) the Certificate Account created by the Master Servicer pursuant
to the Pooling and Servicing Agreement, (b) all funds from time to time on
deposit in the Certificate Account, (c) the investments of any such funds
consisting of securities, instruments or other obligations (including the
Permitted Investments described on Exhibit B hereto), and (d) the general
intangibles consisting of the contractual right to payment, including the
right to payments of principal and interest and the right to enforce the
related payment obligations, arising from or under any such investments;
J-3
<PAGE>
5. All REO Property;
6. (a) the REO Account required to be maintained by the Special
Servicer pursuant to the Pooling and Servicing Agreement, (b) all funds
from time to time on deposit in the REO Account, (c) the investments of any
such funds consisting of securities, instruments or other obligations
(including the Permitted Investments described on Exhibit B hereto), and
(d) the general intangibles consisting of the contractual right to payment,
including the right to payments of principal and interest and the right to
enforce the related payment obligations, arising from or under any such
investments;
7. (a) the Reserve Account(s) and the Servicing Accounts maintained by
the Master Servicer or Special Servicer pursuant to the Pooling and
Servicing Agreement, (b) all funds from time to time on deposit in the
Reserve Account(s) or the Servicing Accounts, (c) the investments of any
such funds consisting of securities, instruments or other obligations
(including the Permitted Investments described on Exhibit B hereto), and
(d) the general intangibles consisting of the contractual right to payment,
including the right to payments of principal and interest and the right to
enforce the related payment obligations, arising from or under any such
investments;
8. (a) the Distribution Account and the Additional Interest
Distribution Account created by the Trustee pursuant to the Pooling and
Servicing Agreement, (b) all funds from time to time on deposit in the
Distribution Account and the Additional Interest Distribution Account, (c)
the investments of any such funds consisting of securities, instruments or
other obligations (including the Permitted Investments described on Exhibit
B hereto), and (d) the general intangibles consisting of the contractual
right to payment, including the right to payments of principal and interest
and the right to enforce the related payment obligations, arising from or
under any such investments;
9. All insurance policies, including the right to payments thereunder,
with respect to the Mortgage Loans required to be maintained pursuant to
the Pooling and Servicing Agreements, transferred to the Trust Fund and to
be serviced by the Master Servicer or Special Servicer; and
10. All income, payments, products and proceeds of any of the
foregoing, together with any additions thereto or substitutions therefor.
THE DEBTOR AND THE SECURED PARTY INTEND THE TRANSACTIONS CONTEMPLATED BY
THE POOLING AND SERVICING AGREEMENT TO CONSTITUTE A SALE OF THE INTEREST IN THE
MORTGAGE NOTES, THE RELATED
J-4
<PAGE>
MORTGAGES AND THE OTHER DOCUMENTS IN THE RELATED MORTGAGE FILES EVIDENCED BY THE
SERIES 1997-C1 CERTIFICATES, AND THIS FILING SHOULD NOT BE CONSTRUED AS A
CONCLUSION THAT A SALE HAS NOT OCCURRED. THE REFERENCES HEREIN TO MORTGAGE NOTES
SHOULD NOT BE CONSTRUED AS A CONCLUSION THAT ANY MORTGAGE NOTE IS NOT AN
INSTRUMENT WITHIN THE MEANING OF THE UNIFORM COMMERCIAL CODE OR THAT A FILING IS
NECESSARY TO PERFECT THE OWNERSHIP OR SECURITY INTEREST OF THE SECURED PARTY IN
ANY MORTGAGE NOTE, MORTGAGE OR OTHER DOCUMENT IN A MORTGAGE FILE. IN ADDITION,
THE REFERENCES HEREIN TO SECURITIES, INSTRUMENTS AND OTHER OBLIGATIONS
(INCLUDING, WITHOUT LIMITATION, PERMITTED INVESTMENTS) SHOULD NOT BE CONSTRUED
AS A CONCLUSION THAT ANY SECURITY, INSTRUMENT OR OTHER OBLIGATION (INCLUDING,
WITHOUT LIMITATION, ANY PERMITTED INVESTMENT) IS NOT AN INSTRUMENT, A
CERTIFICATED SECURITY OR AN UNCERTIFICATED SECURITY WITHIN THE MEANING OF THE
UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY APPLICABLE JURISDICTION, NOR SHOULD
THIS FINANCIAL STATEMENT BE CONSTRUED AS A CONCLUSION THAT A FILING IS NECESSARY
TO PERFECT THE OWNERSHIP OR SECURITY INTEREST OF THE SECURED PARTY IN THE
CONTRACTUAL RIGHT TO PAYMENT, INCLUDING THE RIGHT TO PAYMENTS OF PRINCIPAL AND
INTEREST AND THE RIGHT TO ENFORCE THE RELATED PAYMENT OBLIGATIONS, ARISING FROM
OR UNDER ANY SECURITY, INSTRUMENT OR OTHER OBLIGATION (INCLUDING, WITHOUT
LIMITATION, ANY PERMITTED INVESTMENT). WITH RESPECT TO THE FOREGOING, THIS
FILING IS MADE ONLY IN THE EVENT OF CONTRARY ASSERTIONS BY THIRD PARTIES.
J-5
<PAGE>
EXHIBIT B
The term "Permitted Investments" shall include any of the following
securities or obligations:
(i) direct obligations of, or obligations fully guaranteed as
to timely payment of principal and interest by, the
United States or any agency or instrumentality thereof,
provided such obligations are backed by the full faith
and credit of the United States. Such obligations must
be limited to those instruments that have a predetermined
fixed dollar amount of principal due at maturity that
cannot vary or change. If rated, such an obligation
should not have an "r" highlighter affixed to its rating
by Standard & Poor's. Interest may either by fixed or
variable. Interest should be tied to a single interest
rate index plus a single fixed spread (if any), and move
proportionately with that index. Such investments should
not be relied upon for a fixed yield;
(ii) repurchase obligations with respect to any security
described in clause (i) above (having original maturities
of not more than 365 days), provided that the short-term
deposit or debt obligations, of the party agreeing to
repurchase such obligations are rated in the highest
rating category of each of Fitch, if rated by Fitch,
Moody's and Standard & Poor's or such lower rating as
will not result in qualification, downgrading or
withdrawal of the ratings then assigned to the
Certificates, as evidenced in writing by the Rating
Agencies. In addition, any such item should not have an
"r" highlighter affixed to its rating by Standard &
Poor's, and its terms should have a predetermined fixed
dollar amount of principal due at maturity that cannot
vary or change. Interest may either by fixed or variable,
and should be tied to a single interest rate index plus a
single fixed spread (if any), and move proportionately
with that index. Such investments should not be relied
upon for a fixed yield;
(iii) certificates of deposit, time deposits, demand deposits
and bankers' acceptances of any bank or trust company
organized under the laws of the United States or any
state thereof (having original maturities of not more
than 365 days), the short term obligations of which are
rated in the highest rating category of each of Fitch, if
rated by Fitch, Moody's and Standard & Poor's or
J-6
<PAGE>
such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to
the Certificates, as evidenced in writing by the Rating
Agencies. In addition, any such item should not have an "r"
highlighter affixed to its rating by Standard & Poor's, and
its terms should have a predetermined fixed dollar amount of
principal due at maturity that cannot very or change.
Interest may either by fixed or variable, and should be tied
to a single interest rate index plus a single fixed spread
(if any), and move proportionately with that index. Such
investments should not be relied upon for a fixed yield;
(iv) commercial paper (having original maturities of not more
than 365 days) of any corporation incorporated under the
laws of the United States or any state thereof (or if not
so incorporated, the commercial paper is United States
Dollar denominated and amounts payable thereunder are not
subject to any withholding imposed by any non-United
States jurisdiction) which is rated in the highest rating
category of each of Fitch, if rated by Fitch, Moody's and
Standard & Poor's. The commercial paper should not have
an "r" highlighter affixed to its rating by Standard &
Poor's and by its terms should have a predetermined fixed
dollar amount of principal due at maturity that cannot
vary or change. Interest may either by fixed or
variable. Interest should be tied to a single interest
rate index plus a single fixed spread (if any), and move
proportionately with that index. Such investments should
not be relied upon for a fixed yield;
(v) units of money market funds rated in the highest rating
category of Fitch, if rated by Fitch, Moody's and AAAm or
AAAm-G by Standard & Poor's or such lower rating as will not
result in qualification, downgrading or withdrawal of the
ratings then assigned to the Certificates, as evidenced in
writing by the Rating Agencies and which maintain a constant
net asset value;
(vi) any other obligation or security acceptable to each Rating
Agency, evidence of which acceptability shall be provided in
writing by each Rating Agency to the Master Servicer, the
Special Servicer and the Trustee;
J-7
<PAGE>
provided that (1) no investment described hereunder shall
evidence either the right to receive (x) only interest with
respect to such investment or (y) a yield to maturity
greater than 120% of the yield to maturity at par of the
underlying obligations; and (2) that no investment described
hereunder may be purchased at a price greater than par if
such investment may be prepaid or called at a price less
than its purchase price prior to stated maturity.
J-8
<PAGE>
EXHIBIT K
Form of Schedule of Certificateholders
Initial
Class Certificate Balance Name of Holder Address
----- ------------------- -------------- -------
K-1
<PAGE>
EXHIBIT L
FORM OF
MASTER SERVICER
COLLECTION REPORT
1997-C1 Merrill
- --------------------------------------------------------------------------------
Transaction Group Loan Prospectus Distribution Current
ID ID ID ID Date Beg.
Sched. Bal.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Current Ending Paid to Current Current Maturity Servicer
Sched. Date Index Rate Note Rate Date & Trust
Bal. Fee Rate
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Fee Rate/ Fee Rate/ Fee Rate/ Fee Rate/ Fee Rate/ Net Pass-
Strip Rate 1 Strip Rate 2 Strip Rate 3 Strip Rate 4 Strip Rate 5 Through
Rate
- --------------------------------------------------------------------------------
L-1
<PAGE>
1997-C1 Merrill
- --------------------------------------------------------------------------------
Next Index Next Note Next Rate Next Pymt Scheduled Int
Rate Rate Adjustment Adjustment Amt
Date Date
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Scheduled Prin Total Scheduled Neg Amt Unscheduled Other Prin
Amt P&I Due Deffered Prin Collection Adjstmnts
Int Amt
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Liquidation/ Prepymt Penalty/ Prepymt Int Liquidation/ Most Recent
Prepymt Date Yield Maint Excess Prepymt Code ASER $
Rec'd (Shortfall)
- --------------------------------------------------------------------------------
L-2
<PAGE>
1997-C1 Merrill
- --------------------------------------------------------------------------------
Most Recent Actual Total P&I Total T&I Other Exp
ASER Cumulative Balance Advance Advance Advance
Date ASER $ Outstanding Outstanding Outstanding
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Status of In Foreclosure REO Bankruptcy Net Proceeds
Loan Bnkruptcy Date Date Date Rec'd on
Liquidation
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Liquidation Realized Date of Mod Modified Modified Preceding
Expense Loss Last Mod Code Note Rate Pymt Rate Fiscal Year
To Trust Revenue
- --------------------------------------------------------------------------------
L-3
<PAGE>
1997-C1 Merrill
- --------------------------------------------------------------------------------
Preceding Preceding Preceding Preceding Fiscal
Fiscal Year Fiscal Year Fiscal Year Year DSCR
Expenses Year NOI Debt Serv Amt
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Preceding Fiscal Preceding FY Finc'l Second Precdng Second Precdng
Yr Physical Occup As Of Date FY Revenue FY Expenses
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Second Precdng Second Precdng Second Precdng Second Precdng
FY NOI FY Debt Service FY DSCR FY Physical
Occupancy
- --------------------------------------------------------------------------------
L-4
<PAGE>
1997-C1 Merrill
- --------------------------------------------------------------------------------
Second Precdng Most Recent Most Recent Most Recent Most Recent
FY Finc'l Fiscal YTD Fiscal YTD Fiscal YTD Fiscal YTD
As of Date Revenue Expenses NOI Debt Svce
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Most Recent Most Recent Most Recent Most Recent Most Recent
Fiscal YTD Fiscal YTD Phys. Fiscal YTD Fiscal YTD Appraisal
DSCR Occ. Start Date End Date Date
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Most Recent Workout Most Recent Most Recent Date Asset
Appraisal Strategy Spec Serv Master Serv is Expected
Value Code Transfer Dt Return Dt To Be Resolved
- --------------------------------------------------------------------------------
L-5
<PAGE>
1997-C1 Merrill
- --------------------------------------------------------------------------------
Year Last Total Int Total Prin Prior Month's
Renovated Advanced Advanced Delinquent
Recoveries
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Balance at Modified Modified Phase 1
Specially Amort. Term Date
Serv. Trf. Dt. Term
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Site Specially Gross Gross Sub-
Inspection Serviced Principal Interest Servicer
Date Status Code Collected Collected Serv. Fee
- --------------------------------------------------------------------------------
L-6
MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement, dated as of June 1, 1997 (the
"Agreement"), between Merrill Lynch Mortgage Capital Inc. (the "Seller") and
Merrill Lynch Mortgage Investors, Inc. (the "Purchaser").
The Seller intends to sell and the Purchaser intends to purchase, without
recourse except as specifically provided herein, certain multifamily and
commercial mortgage loans (the "Mortgage Loans") as provided herein. The
Purchaser intends to deposit them, together with the Daiwa Mortgage Loans (as
defined below) and GECA Mortgage Loans (as defined below), into a trust fund
(the "Trust Fund"), the beneficial ownership of which will be evidenced by
multiple classes (each, a "Class") of mortgage pass-through certificates (the
"Certificates"). One or more "real estate mortgage investment conduit" ("REMIC")
elections will be made with respect to the Trust Fund. The Trust Fund will be
created and the Certificates will be issued pursuant to a Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June 1, 1997 (the
"Cut-off Date"), among the Purchaser as depositor, GE Capital Asset Management
Corporation as master servicer (in such capacity, the "Master Servicer"), GE
Capital Realty Group, Inc. as special servicer (in such capacity, the "Special
Servicer"), General Electric Capital Corporation, ABN AMRO Bank N.V. as fiscal
agent (in such capacity, the "Fiscal Agent") and LaSalle National Bank as
trustee (the "Trustee"). Concurrently with the purchase of Mortgage Loans
pursuant to this Agreement, the Purchaser will also purchase multifamily and
commercial mortgage loans pursuant to a Mortgage Loan Purchase Agreement, dated
as of June 1, 1997, between Daiwa Finance Corp. ("Daiwa") and the Purchaser (the
"Daiwa Agreement") and pursuant to a Mortgage Loan Purchase Agreement, dated as
of June 1, 1997, between GE Capital Access, Inc. ("GECA") and the Purchaser (the
"GECA Agreement"). Such mortgage loans (the "Daiwa Mortgage Loans" and the "GECA
Mortgage Loans", respectively) will likewise be deposited into the Trust Fund.
Capitalized terms used but not defined herein have the respective meanings set
forth in the Pooling and Servicing Agreement.
Now, therefore, in consideration of the premises and the mutual agreements
set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
(a) The Seller agrees to sell, and the Purchaser agrees to purchase,
without recourse except as specifically provided herein, the Mortgage Loans
identified on the schedule (the "Mortgage Loan Schedule") annexed hereto as
Exhibit A. The Mortgage Loan Schedule may be amended to reflect the actual
Mortgage Loans. (The Mortgage Loans identified on the Mortgage
<PAGE>
Loan Schedule shall hereinafter be referred to as the "MLMC Mortgage Loans.")
The MLMC Mortgage Loans will have an aggregate principal balance of $498,496,030
(the "MLMC Balance") as of the close of business on the Cut-off Date, after
giving effect to any payments due before such date whether or not received. The
MLMC Balance, the Daiwa Balance (as defined in the Daiwa Agreement) and the GECA
Balance (as defined in the GECA Agreement) together equal an aggregate principal
balance (the "Initial Pool Balance") of $840,787,856. The purchase and sale of
the MLMC Mortgage Loans shall take place on June 26, 1997 or such other date as
shall be mutually acceptable to the parties hereto (the "Closing Date"). The
consideration for the MLMC Mortgage Loans shall consist of a cash amount equal
to (A) 100% of the MLMC Balance, plus (B) interest accrued on each MLMC Mortgage
Loan at the related Mortgage Rate, for the period from and including the Cut-off
Date up to but not including the Closing Date, which cash amount shall be paid
to the Seller or its designee by wire transfer in immediately available funds on
the Closing Date.
The Purchaser will assign to the Trustee, all of its right,
title and interest in and to the MLMC Mortgage Loans.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 hereof, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Purchaser, without
recourse, all the right, title and interest of the Seller in and to the MLMC
Mortgage Loans identified on the Mortgage Loan Schedule as of such date. The
Mortgage Loan Schedule, as it may be amended, shall conform to the requirements
set forth in this Agreement and the Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive all
scheduled payments of principal and interest due after the Cut-off Date, and all
other recoveries of principal and interest collected after the Cut-off Date
(other than in respect of principal and interest on the MLMC Mortgage Loans due
on or before the Cut-off Date). All scheduled payments of principal and interest
due on or before the Cut-off Date but collected after the Cut-off Date, and
recoveries of principal and interest collected on or before the Cut-off Date
(only in respect of principal and interest on the MLMC Mortgage Loans due on or
before the Cut-off Date), shall belong to, and be promptly remitted to, the
Seller.
(c) The Seller hereby represents and warrants that it has, on behalf
of the Purchaser, delivered to the Trustee, the documents and instruments
specified below with respect to each MLMC Mortgage Loan (each a "Mortgage
File"). All Mortgage Files so delivered will be held by the Trustee in escrow at
all times prior to the Closing Date. Each Mortgage File shall,
-2-
<PAGE>
except as otherwise disclosed on Exhibit B hereto, contain the following
documents:
(i) the original executed Mortgage Note, endorsed (including
interim endorsements and without recourse, representation or
warranty, express or implied) to the order of LaSalle National
Bank, as trustee for the registered holders of Merrill Lynch
Mortgage Investors, Inc., Mortgage Pass-Through Certificates,
Series 1997-C1;
(ii) an original or copy of the Mortgage and of any intervening
assignments thereof, in each case with evidence of recording
indicated thereon;
(iii) an original or copy of any related Assignment of Leases (with
recording information indicated thereon), if such item is a
document separate from the Mortgage;
(iv) an original executed assignment of the Mortgage, any related
Assignment of Leases (if such item is a document separate from
the Mortgage), and any other recorded document relating to the
Mortgage Loan otherwise included in the Mortgage File, in
favor of LaSalle National Bank, as trustee for the registered
holders of Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of LaSalle National Bank, as
trustee for the registered holders of Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series
1997-C1, in recordable form;
(vi) originals or copies of any written modification agreements in
those instances where the terms or provisions of the Mortgage
or Mortgage Note have been modified;
(vii) the original or a copy of the policy or certificate of
lender's title insurance issued in connection with the
origination of such Mortgage Loan, or, if such policy has not
been issued, an irrevocable, binding commitment to issue such
title insurance policy; and
(viii) filed copies of any prior UCC Financing Statements in favor
of the originator of such
-3-
<PAGE>
Mortgage Loan or in favor of any assignee prior to the Trustee
(but only to the extent the Seller had possession of such UCC
Financing Statements prior to the Closing Date) and, if there
is an effective UCC Financing Statement in favor of the Seller
on record with the applicable public office for UCC Financing
Statements, an original UCC-2 or UCC-3, as appropriate, in
favor of LaSalle National Bank, as trustee for the registered
holders of Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1.
(d) Within 30 days following the Closing Date, the Purchaser shall
submit or cause to be submitted for recordation or filing, as the case may be,
in the appropriate public office for real property records or Uniform Commercial
Code financing statements, as appropriate, each assignment of Mortgage and each
assignment of Assignment of Leases referred to in clause (iv) of subsection (c)
above and each UCC-2 and UCC-3 in favor of and delivered to the Trustee
constituting part of the Mortgage File. If any such document or instrument is
lost or returned unrecorded or unfiled, as the case may be, because of a defect
therein, then the Seller shall promptly prepare a substitute therefor or cure
such defect or cause such to be done, as the case may be, and the Seller shall
promptly deliver such substitute or corrected document or instrument to the
Purchaser or its designee.
(e) All documents necessary to the servicing of the MLMC Mortgage
Loans and in the Seller's possession (the "Additional Mortgage Loan Documents")
that are not required to be delivered to the Trustee shall be delivered or
caused to be delivered by the Seller to the Master Servicer or at the direction
of the Master Servicer, to the appropriate sub-servicer.
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants with
the Purchaser, as of the date hereof, that:
(i) The Seller is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and is duly authorized
and qualified to transact any and all business contemplated by this Agreement
and possesses all requisite authority, power, licenses, permits and franchises
to execute, deliver and comply with its obligations under the terms of this
Agreement and to carry on its business as currently conducted by it, except
-4-
<PAGE>
to the extent that the failure to obtain the same would not, in the Seller's
good faith judgment, materially and adversely affect the condition (financial or
other), operations of the Seller or its properties, or the value of the Mortgage
Loans.
(ii) This Agreement has been duly and validly authorized, executed
and delivered by the Seller and, assuming due authorization, execution and
delivery hereof by the Purchaser, constitutes a legal, valid and binding
obligation of the Seller, enforceable against the Seller in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights in general and by general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law), or
by public policy considerations underlying the securities laws, to the extent
that such public policy considerations limit the enforceability of the
provisions of this Agreement which purport to provide indemnification from
liabilities under applicable securities laws.
(iii) The execution and delivery of this Agreement by the Seller and
the Seller's performance and compliance with the terms of this Agreement will
not (A) violate the Seller's certificate of incorporation or By-Laws, (B)
violate any law or regulation or any administrative decree or order to which it
is subject or (C) constitute a default (or an event which, with notice or lapse
of time, or both, would constitute a default) under, or result in the breach of,
any material contract, agreement or other instrument to which the Seller is a
party or which may be applicable to the Seller or any of its assets.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or other governmental agency or body, which default might have
consequences that would, in the Seller's reasonable and good faith judgment,
materially and adversely affect the condition (financial or other) or operations
of the Seller or its properties or have consequences that would materially and
adversely affect its performance hereunder.
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any certificate of incorporation, bylaws or any other
corporate restriction or any judgment, order, writ, injunction, decree, law or
regulation that would, in the Seller's reasonable and good faith judgment,
materially and adversely affect the ability of the Seller to perform its
obligations under this Agreement or that requires the consent of any third
person
-5-
<PAGE>
to the execution of this Agreement or the performance by the Seller of its
obligations under this Agreement.
(vi) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Seller of or compliance by the Seller with this Agreement or
the consummation of the transactions contemplated by this Agreement and no bulk
sale law applies to such transactions.
(vii) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller that would, in the Seller's good faith
and reasonable judgment, prohibit its entering into this Agreement or adversely
affect the performance by the Seller of its obligations under this Agreement.
(viii) Under generally accepted accounting principles ("GAAP") and
for federal income tax purposes, the Seller will report the transfer of the MLMC
Mortgage Loans to the Purchaser as a sale of the MLMC Mortgage Loans to the
Purchaser in exchange for consideration consisting of a cash amount equal to (A)
100% of the MLMC Balance, plus (B) interest accrued on each MLMC Mortgage Loan
at the related Mortgage Rate, for the period from and including the Cut-off Date
up to but not including the Closing Date. The consideration received by the
Seller upon the sale of the MLMC Mortgage Loans to the Purchaser will constitute
reasonably equivalent value and fair consideration for the MLMC Mortgage Loans.
The Seller will be solvent at all relevant times prior to, and will not be
rendered insolvent by, the sale of the MLMC Mortgage Loans to the Purchaser. The
Seller is not selling the MLMC Mortgage Loans to the Purchaser with any intent
to hinder, delay or defraud any of the creditors of the Seller.
(ix) Immediately prior to the sale of the MLMC Mortgage Loans to the
Purchaser as herein contemplated, the Seller will have good title thereto and be
the sole owner thereof, and such sale will transfer the MLMC Mortgage Loans to
the Purchaser free and clear of any pledge, lien, encumbrance or security
interest.
(x) The Prospectus dated June 5, 1997, as of the date of the
Prospectus Supplement dated June 20, 1997 (the "Prospectus Supplement"), or as
of the Closing Date, does not include any untrue statement of a material fact
relating to the MLMC Mortgage Loans or the Seller in the Sections entitled
"SUMMARY-Mortgage Loan Sellers", "SUMMARY-The Mortgage Pool" and "DESCRIPTION OF
THE MORTGAGE POOL" in the Prospectus Supplement, or omitted or omits to state
therein a material fact necessary in order to make the statements in such
Sections relating to the MLMC Mortgage Loans or the Seller, in light of the
circumstances under which they were
-6-
<PAGE>
made, not misleading, and the Memorandum (as defined in the Certificate Purchase
Agreement, dated as of June 26, 1997), as of the date thereof or as of the
Closing Date, insofar as the Memorandum incorporates such sections of the
Prospectus Supplement, does not include any untrue statement of a material fact
relating to the MLMC Mortgage Loans or the Seller or omitted or omits to state
therein a material fact necessary in order to make the statements therein
relating to the MLMC Mortgage Loans or the Seller, in the light of the
circumstances under which they were made, not misleading. As the sole remedy for
breach of this representation, the Seller shall indemnify the Purchaser against
any and all losses, claims, damages or liabilities to which the Purchaser may
become subject as a result of the breach of the representations contained in
this Section 3(a)(x) pursuant to Section 7 hereof.
(b) The Seller hereby represents and warrants for the benefit of the
Purchaser and the Trustee for the benefit of the Certificateholders, as of the
Closing Date, with respect to each MLMC Mortgage Loan, that:(i) The Seller has
good and marketable title to, and is the sole owner and holder of, the Mortgage
Loan.
(ii) The Seller has full right and authority to sell, assign and
transfer the Mortgage Loan.
(iii) The information pertaining to the Mortgage Loan set forth in
the Mortgage Loan Schedule is true, correct and complete in all material
respects as of the Cut-off Date.
(iv) The related Mortgagor has represented to the Seller or the
Mortgagee, as applicable, that as of the date of origination of the Mortgage
Loan, such Mortgagor, lessee and/or operator was in possession of all licenses,
permits, and authorizations then required for use of the Mortgaged Property
which were valid and in full force and effect as of the origination date.
(v) The origination, servicing and collection practices used by the
Seller and, to the best of Seller's knowledge, any prior holder of the Mortgage
Note have been in all respects legal, proper and prudent and have met customary
industry standards.
(vi) The Seller is transferring the Mortgage Loan to the Purchaser
free and clear of any liens, pledges, charges and security interests and the
related Mortgage and Mortgage Note do not prohibit such transfer.
(vii) The proceeds of the Mortgage Loan have been fully disbursed
and there is no requirement for future advances thereunder.
-7-
<PAGE>
(viii) If such Mortgage Loan was originated by the Seller or an
affiliate thereof, the Mortgage Loan complied with all applicable usury,
truth-in-lending, real estate settlement, equal credit opportunity, disclosure
and any other material laws applicable to such origination as of the origination
date; and if such Mortgage Loan was not originated by the Seller or an affiliate
thereof, then, to the best of the Seller's knowledge after having performed the
type of due diligence customarily performed by prudent institutional commercial
and multifamily mortgage lenders, the Mortgage Loan complied with all applicable
usury, truth-in-lending, real estate settlement, equal credit opportunity,
disclosure and any other material laws applicable to the origination of such
Mortgage Loan as of the origination date.
(ix) Each of the related Mortgage Note, related Mortgage and other
agreements executed in connection therewith is the legal, valid and binding
obligation of the maker thereof (subject to any non-recourse provisions
contained in any of the foregoing agreements and any applicable state
anti-deficiency legislation), enforceable in the applicable state in accordance
with its terms and contains customary and enforceable provisions such as to
render the rights and remedies of the holder thereof adequate for the
realization against the related Mortgaged Property or properties of the benefits
of the security, including realization by judicial or, if applicable,
non-judicial foreclosure, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally, and by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and, to the best of Seller's knowledge, there is no valid defense,
counterclaim or right of offset or rescission available to the related Mortgagor
as of the Closing Date with respect to such Mortgage Note, Mortgage or other
agreements.
(x) The Mortgage File contains an Assignment of Leases (or the
related Mortgage provides for such an assignment), which creates, in favor of
the holder of the Note, a valid first-priority assignment of or security
interest in the right to receive all payments due under the related leases, and
no other person owns any interest therein superior to or of equal priority with
the interest created under such assignment; provided that the enforceability of
such lien is subject to applicable bankruptcy, insolvency, reorganization,
moratorium, and other laws affecting the enforcement of creditors' rights
generally, and by the application of the rules of equity.
(xi) Since the origination of the Mortgage Loan the terms of the
related Mortgage Note, Mortgage and
-8-
<PAGE>
Security Agreements have not been impaired, waived, modified, altered,
satisfied, canceled or subordinated by the Seller, the originator or the
servicer thereof in any respect, except, in each of the foregoing instances, by
written instruments that are a part of the related Mortgage File, recorded in
the applicable public recording office if necessary to maintain the priority of
the lien of the related Mortgage and Security Agreements and delivered to the
Purchaser.
(xii) The Mortgage Loan complies with the Seller's or the Seller's
affiliate's that originated the Mortgage Loan underwriting policies in effect as
of such Mortgage Loan's origination date or, in the case of Mortgage Loans
acquired by the Seller (other than from an affiliate), as of the date of such
acquisition, (as applicable), and, except for the Mortgage Loans acquired by the
Seller, is on a form commonly used by the Seller as of such date.
(xiii) The related Mortgage Note is not secured by any collateral
that is not being transferred to the Purchaser and each Mortgage Loan that is
cross-collateralized is cross-collateralized only with other Mortgage Loans sold
pursuant to this Agreement.
(xiv) The assignment of the related Mortgage and Assignment of
Leases to the Trustee constitutes the legal, valid, binding and enforceable
assignment of such Mortgage in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally, and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(xv) The Mortgage Loan is not a participation interest in a mortgage
loan, but is a whole loan, and the Seller does not own any equity interest in
the Mortgagor.
(xvi) Except with respect to the Mortgage Loans listed on Exhibit C
attached hereto, which provide for hyperamortization, the Mortgage Loan does not
contain any terms providing for a contingent interest, or negative amortization.
(xvii) The related Mortgage creates a first-mortgage lien on the
related Mortgaged Property. Such lien has priority over all other liens and
encumbrances (including mechanic's or materialmen's liens) except for (A) the
lien for current real estate taxes and assessments not yet due and payable and
(B) covenants, conditions and restrictions, rights of way, easements and other
non-lien matters that are of public record and are referred to in the related
lender's title insurance policy, none of which,
-9-
<PAGE>
individually or in the aggregate, materially interferes with the security
intended to be provided by such Mortgage. A UCC financing statement has been
filed and/or recorded in all places necessary to perfect a valid security
interest in the personal property, granted under such Mortgage for which
perfection is accomplished by the filing of a UCC financing statement; any
security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid
and enforceable first lien and first priority security interest on the property
described therein, provided that enforceability may be limited by bankruptcy or
other laws affecting creditor's rights or by the application of the rules of
equity.
(xviii) The related Mortgage Note and Mortgage do not require the
Mortgagee thereof to release any portion of the related Mortgaged Property from
the lien of the Mortgage that would have a material and adverse affect on the
related Mortgage Loan except upon payment in full of the Mortgage Loan.
(xix) As of the Cut-off Date, there are no delinquent taxes,
assessments or other governmental charges which would be a lien against the
related Mortgaged Property affecting the related Mortgaged Property or an escrow
of funds in an amount sufficient to cover such payments has been established.
(xx) Except as set forth in Exhibit D attached hereto, all escrows,
reserves, deposits and other payments relating to the Mortgage Loan are under
the control of the Seller or servicer of such Mortgage Loan and all amounts
required as of the date hereof under the Mortgage Loan Documents to be deposited
by the related Mortgagor have been deposited and to the best of Seller's
knowledge, to the extent such amounts have been applied, they have been applied
as intended. All such escrows, reserves, deposits and other payments have been
conveyed by the Seller to the Trustee.
(xxi) (A) Except for certain delinquent payments, none of which were
thirty (30) or more days past the date when first due, since the later of one
year prior to the Closing Date or, if applicable, the date of acquisition by the
Mortgage Loan Seller of such Mortgage Loan, through the Cut-Off Date, there was
no material default, breach, violation or event of acceleration existing under
the related Mortgage or the related Mortgage Note, and to the best knowledge of
Seller, after due inquiry, no event which, with the passage of time or with
notice and the expiration of any grace or cure period, would constitute a
material default, breach, violation or event of acceleration; and (B) the Seller
has not waived any material
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default, breach, violation or event of acceleration of any of the foregoing,
and, pursuant to the terms of the related Mortgage or the related Mortgage Note,
no person or party other than the holder of such Mortgage Note may declare any
event of default or accelerate the related indebtedness under either of such
Mortgage or Mortgage Note.
(xxii) Except as set forth in Exhibit E attached hereto, the related
Mortgage provides that the Mortgagor is required to provide to the Mortgagee at
least annually an operating statement, rent roll (if applicable and if requested
by the Mortgagee) and balance sheet, and if requested in accordance with the
terms of the Mortgage Loan, rent rolls, with respect to the Mortgaged Property
certified by a duly authorized officer of the Mortgagor as true and correct as
of the date thereof.
(xxiii) There is no proceeding known to the Seller to be pending,
after due inquiry, or threatened in writing for the total or partial
condemnation of a material part of the related Mortgaged Property, and the
Mortgaged Property is free and clear of any damage not covered by insurance that
would materially and adversely affect its value as security for the Mortgage
Loan; to the Seller's actual knowledge, there are no pending actions, suits or
proceedings by or before any court or governmental authority against or
affecting the related Mortgagor or the related Mortgaged Property that, if
determined adversely to such Mortgagor or Mortgaged Property, would materially
and adversely affect the value of the Mortgaged Property or the ability of the
Mortgagor to pay principal, interest or any other amounts due under such
Mortgage Loan.
(xxiv) Based on the type of due diligence customarily performed by
prudent institutional commercial and multifamily mortgage lenders, each
improvement located on or forming part of the related Mortgaged Property
complies with applicable laws and zoning ordinances, or constitutes a legal
non-conforming use or structure or, if such an improvement does not so comply,
such non-compliance does not materially and adversely affect the value or
operation of the Mortgaged Property.
(xxv) None of the improvements included for the purpose of
determining the appraised value of the related Mortgaged Property at the time of
the origination of the Mortgage Loan lies outside of the boundaries and building
restriction lines of the related Mortgaged Property, except for certain
immaterial encroachments therefrom, and no improvements on adjoining properties
materially encroach upon the related Mortgaged Property.
(xxvi) The related Mortgaged Property is covered by an ALTA lender's
title insurance policy or its
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equivalent, insuring for the benefit of the original holder of the related Note,
its successors and assigns, that the related Mortgage is a valid first mortgage
lien on such Mortgaged Property in the original principal amount of the related
Note, subject only to the exceptions stated therein, which do not and will not
materially and adversely interfere with (1) the ability of the related Mortgagor
timely to pay in full the principal and interest on the related Mortgage Note,
or (2) the use of such Mortgaged Property for the use currently being made
thereof, or (3) the value of the Mortgaged Property, and such policy is freely
assignable to the trustee without the consent of or any notification to the
insurer; and such title insurance policy is in full force and effect, no claims
have been made thereunder and to the best knowledge of the Seller, no holder of
the related Mortgage has done anything that would materially impair the coverage
under such policy.
(xxvii) The related Mortgaged Property is insured by a fire and
extended perils insurance policy that provides coverage in an amount not less
than the lesser of (a) the outstanding principal balance of the Mortgage Loan
and (b) the full replacement cost and, in any event, such insurance policy is in
an amount necessary to avoid the operation of any co-insurance provisions with
respect to the Mortgaged Property; each related Mortgage obligates the related
Mortgagor to maintain or cause to be maintained all such insurance and at such
Mortgagor's failure to do so, does not prohibit the Mortgagee from maintaining
such insurance, and such insurance requires, or the related Mortgage requires
the Mortgagor to cause the related insurer to provide, prior notice to the
Mortgagee at termination or cancellation, and no such notice has been received;
any insurance proceeds in respect of a casualty loss or taking, will be applied
either to the repair or restoration of all or part of the related Mortgaged
Property or the payment of the outstanding principal balance of the related
Mortgage Loan, except for certain amounts not greater than amounts which would
be considered prudent by an institutional commercial mortgage lender with
respect to a similar mortgage loan and which are set forth in the related
Mortgage. Except as set forth on Exhibit F attached hereto, the Mortgagee is
named as a beneficiary under such insurance policy.
(xxviii) Except as set forth on Exhibit G attached hereto, the
related Mortgaged Property is insured by business interruption or rent
insurance, in an amount at least equal to 12 months (or, in the case of the
Mortgage Loans listed in Exhibit H attached hereto, 6 months) of operations of
such Mortgaged Property and comprehensive general liability insurance in an
amount not less than $1 million per occurrence.
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(xxix) Except as set forth on Exhibit I attached hereto, no
improvements on a related Mortgaged Property are located in a "flood hazard
area" as defined by the Federal Insurance Administration or, if so located, are
covered by flood hazard insurance.
(xxx) The Mortgage Loan represents a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code. The Seller represents and warrants
that, either as of the date of origination or the Closing Date, the fair market
value of the property securing the Mortgage Loan was not less than 80% of the
"adjusted issue price" (within the meaning of the REMIC Provisions) of such
Mortgage Loan.
(xxxi) Prepayment Premiums and Yield Maintenance Charges payable
with respect to the Mortgage Loan, if any, constitute "customary prepayment
penalties" within the meaning of Treasury regulation Section 1.860G-1(b)(2).
(xxxii) A Phase I Environmental Site Assessment was performed with
respect to the related Mortgaged Property. Such Phase I Environmental Site
Assessment was performed within eight (8) months prior to their respective dates
of origination. A report of such Phase I Environmental Site Assessment has been
delivered to the Purchaser, and the Seller (or its affiliate that originated the
Mortgage Loan), having made no independent inquiry other than reviewing such
report, has no knowledge of any material and adverse environmental condition or
circumstance affecting the related Mortgaged Property that was not disclosed in
such report. To the extent any such condition or circumstance was disclosed,
there has been escrowed an amount of money considered sufficient by the Seller,
based upon the related environmental reports, to cure and remedy such condition
or circumstance as recommended in the Phase I or, where applicable, Phase II
Environmental Site Assessment or such condition has been cured and remedied. The
Seller has received no notice of any other such condition or circumstance.
(xxxiii) The Mortgage Loan contains a representation made by the
Mortgagor in substance that it has not and will not use, cause or permit to
exist on the related Mortgaged Property any hazardous materials in any manner
that violates federal, state or local laws, ordinances, regulations or orders.
The Mortgage Loan requires that the Mortgagor will defend and hold the holder of
the Mortgage and its successors and/or assigns harmless from and against any and
all losses, liabilities, damages, injuries, penalties, fines, expenses, and
claims of any kind whatsoever (including attorney's fees and costs) paid,
incurred, or suffered by, or asserted against, any such party resulting from a
breach of any representation, warranty or covenant relating to environmental
matters given
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by the Mortgagor under the related Mortgage except for those resulting from
gross negligence or willful misconduct by the holder of the Mortgage or those
which are initially placed on, in or under the Mortgaged Property after
foreclosure or other taking of title to the Mortgaged Property by the holder of
the Mortgage. Subject to the last sentence of this clause (xxxiii), to the best
of the Seller's knowledge, having made no independent inquiry other than
reviewing Phase I and Phase II (where applicable) Environmental Site
Assessments, (i) the Mortgaged Property is in material compliance with all
applicable federal, state and local laws pertaining to environmental regulation,
contamination or clean-up, and (ii) no notice of violation of such laws has been
issued by any governmental agency or authority, except as disclosed in
environmental or engineering assessments, including Phase I Environmental Site
Assessments or additional assessments (including Phase II Environmental Site
Assessments). To the extent any material violation was disclosed, there has been
escrowed an amount of money considered sufficient by the Seller, based upon the
related environmental reports, to cure and remedy such condition or circumstance
as recommended in the Phase I or Phase II Environmental Site Assessment or such
condition has been cured and remedied.
(xxxiv) To the best knowledge of the Seller, after due inquiry at
origination, the Mortgagor is not a debtor in any state or federal bankruptcy,
insolvency, reorganization or similar proceeding.
(xxxv) No advance of funds has been made directly or indirectly, by
the Seller to the Mortgagor other than pursuant to the Note and to Seller's (or
its affiliate's that originated the Mortgage Loan) knowledge, no funds have been
received from any person other than such Mortgagor for or on account of payments
due on the Note.
(xxxvi) The related Mortgage prohibits, without the prior written
consent of the holder of such Mortgage, any sale or transfer of, or pledge or
lien on, the related Mortgaged Property, whether such lien may be equal or
subordinate to the lien of the related Mortgages, other than (1) certain
subordinate liens governed by standstill agreements which each provide that the
subordinate lender may not accelerate or otherwise take any remedial action for
so long as the Mortgage Loan is outstanding (the Mortgaged Properties encumbered
by such subordinate liens and the principal amounts of and interest rates on the
related debt are set forth on Exhibit J-1 attached hereto) and (2) certain
subordinate liens that may be incurred in the future on the Mortgaged Properties
set forth on Exhibit J-2 attached hereto, provided that the future subordinate
debt secured by such liens (a) when combined with the applicable Mortgage Loan
does not exceed an 80% loan-to-value and has
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at least a 1.20 debt service coverage and (b) is subject to a standstill
agreement with provisions similar to those represented above for existing
subordinate liens.
(xxxvii) If the related Mortgaged Property is a retail, office,
industrial or multifamily property, to the best of Seller's (or its affiliate's
that originated the Mortgage Loan) knowledge, (i) the information contained in
the related schedule of leases or most recent rent roll, as the case may be, is
true and correct in all material respects, (ii) all leases set forth therein are
in full force and effect, and (iii) except as set forth in Exhibit K attached
hereto, based on Mortgagor's representations, tenant estoppel certificates or
other documents obtained by the Seller (or its affiliate that originated the
Mortgage Loan) from the related Mortgagor and/or tenants in connection with the
origination of the related Mortgage Loan, no material default by the Mortgagor
or the lessees has occurred under such leases, nor, to the best of the Seller's
knowledge, is there any existing condition which, but for the passage of time or
the giving of notice, or both, would result in a material default under the
terms of such lease.
(xxxviii) Except with respect to the Mortgage Loans identified in
Exhibit L attached hereto, if the principal balance of the related Mortgage Loan
is greater than $10 million, the related Mortgagor is a person, other than an
individual, which is formed or organized solely for the purpose of owning and
operating the Mortgaged Property (or has covenanted to restrict its operations
to owning or operating the Mortgaged Property), does not engage in any business
unrelated to such property and its financing, does not have any assets other
than those related to its interest in the property or its financing, or any
indebtedness other than as permitted by the related Mortgage and the other
Mortgage Loan documents, has its own books and records and accounts separate and
apart from any other person, and holds itself out as being a legal entity,
separate and apart from any other person.
(xxxix) With respect to any Mortgage Loan that is secured in whole
or in part by the interest of a Mortgagor as a lessee under a Ground Lease (for
these purposes, the term "Ground Lease" includes any related ground lessor
estoppels and any other writings from ground lessor) but not by the related fee
interest:
(A) Such Ground Lease or a memorandum thereof has been duly recorded and
such Ground Lease permits the interest of the lessee thereunder to be encumbered
by the related Mortgage or, if consent of the lessor thereunder is required, it
has been obtained prior to the Closing Date;
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(B) The Mortgagor's interest in such Ground Lease is to the Trustee
without the consent of the lessor thereunder (or, if any such consent is
required, it has been obtained prior to the Closing Date) and, in the event that
it is so assigned, is further assignable by the Trustee and its successors
without a need to obtain the consent of such lessor;
(C) Such Ground Lease may not be amended, modified, canceled or terminated
without the prior written consent of the Mortgagee and that any such action
without such consent is not binding on the Mortgagee, its successors or assigns.
(D) Unless otherwise set forth in the Ground Lease, the Ground Lease does
not permit any increase in the amount of rent payable by the Ground Lessee
thereunder during the term of the Mortgage Loan.
(E) To the best of the Seller's knowledge, at the Closing Date, such
Ground Lease is in full force and effect and no default or condition which with
passage of time would become a default, has occurred under such Ground Lease;
(F) Such Ground Lease requires the lessor thereunder to give notice of any
default by the lessee to the Mortgagee; and such Ground Lease, or an estoppel or
consent letter received by the Mortgagee from the lessor, further provides that
no notice of termination given under such Ground Lease is effective against the
mortgagee unless a copy has been delivered to the mortgagee in the manner
described in such Ground Lease or estoppel or consent letter;
(G) The ground lessee's interest in the Ground Lease (I) is not subject to
any liens or encumbrances superior to, or of equal priority with, the related
Mortgage, other than the related ground lessor's related fee interest and any
exceptions stated in the related title insurance policy or opinion of title,
which exceptions do not and will not materially and adversely interfere with (1)
the ability of the related Mortgagor timely to pay in full the principal and
interest on the related Mortgage Note, (2) the use of such Mortgaged Property
for the use currently being made thereof, or (3) the value of the Mortgaged
Property and (II) will not be interfered with in the event of any foreclosure or
other action taken by any mortgagee of the ground lessor's fee interest.
(H) A Mortgagee is permitted a reasonable opportunity (including, where
necessary, sufficient time to gain possession of the interest of the lessee
under such Ground Lease) to cure any curable default under such Ground Lease
before the lessor thereunder may terminate such Ground Lease; and
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(I) Such Ground Lease has an original term (including any extension
options set forth therein) that extends not less than 10 years beyond the final
maturity date of the related Mortgage Loan.
(J) Under the terms of such Ground Lease and the related Mortgage, taken
together, any related insurance proceeds or condemnation proceeds, will be
applied either to the repair or restoration of all or part of the related
Mortgaged Property, with the lessee's mortgagee or a trustee appointed by it
having the right to hold and disburse such proceeds as the repair or restoration
progresses, or to the payment of the outstanding principal balance of the
Mortgage Loan together with any accrued interest thereon; and
(K) Such Ground Lease does not impose any restrictions on subletting which
would be viewed as commercially unreasonable by a prudent commercial mortgage
lender.
(L) Upon request, the Ground Lessor is required to enter into a new lease
upon termination of the Ground Lease for any reason, on substantially similar
terms and conditions as the old lease including the rejection of the lease in
bankruptcy.
(M) To the best of Seller's (or its affiliate's which originated the
Mortgage Loan) knowledge, the terms of the related Ground Lease have not been
waived, modified, altered, satisfied, impaired, cancelled, subordinated or
rescinded in any manner which materially interferes with the security intended
to be provided by such Mortgage.
(xl) As of the Cut-off Date, the aggregate principal amount of any
Mortgage Loan or group of Mortgage Loans made to one borrower or group of
affiliated borrowers does not exceed $54,071,697. Based on information obtained
from the related Mortgagor at the time of origination, a list of borrowers or
groups of affiliated borrowers with multiple Mortgage Loans is attached hereto
as Exhibit M.
(xli) With respect to any Mortgage Loan that is secured in whole or
in part by a Mortgaged Property which is operated as a residential health care
facility (a "Facility"), if any:
(A) All governmental licenses, permits, regulatory agreements or other
approvals or agreements necessary or desirable for the use and operation of each
Facility as intended are held by the related Mortgagor or the operator of the
Facility, and are in full force and effect, including, without limitation, a
valid certificate of need ("CON") or similar certificate, license, or approval
issued by the applicable department of health for the requisite
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number of beds, and approved provider status in any approved provider payment
program (collectively, the "Licenses").
(B) The Licenses (a) may not be, and have not been, transferred to any
location other than the Facility; (b) have not been pledged as collateral
security for any other loan or indebtedness; and (c) are held free from
restrictions or known conflicts which would materially impair the use or
operation of the Facility as intended, and are not provisional, probationary or
restricted in any way.
(C) As of the Cut-off Date and to Seller's knowledge, without inquiry, as
of the Cut-off Date, the Facility has not received a "Level A" (or equivalent)
violation which has not been cured to the satisfaction of the applicable
governmental agency, and no statement of charges or deficiencies has been made
or penalty enforcement action has been undertaken against the Facility, its
operator or the Mortgagor or against any officer, director or stockholder of
such operator or the Mortgagor by any governmental agency during the last three
calendar years, and there have been no violations over the past three years
which have threatened the Facility's, the operator's or the Mortgagor's
certification for participation in Medicare or Medicaid or the other third-party
payors' programs.
(xlii) If the related Mortgage is a deed of trust, a trustee, duly
qualified under applicable law to serve as such, is properly designated and
serving under such Mortgage.
(c) If the Seller receives notice of a Document Defect or a Breach
(the "Defect/Breach Notice"), which materially and adversely affects the
interests of the Certificateholders, then the Seller shall within 90 days after
its receipt of the Defect/Breach Notice (i) cure such Document Defect or Breach,
as the case may be, in all material respects, which shall include payment of
losses and any Additional Trust Fund Expenses associated therewith, or (ii)
repurchase the affected MLMC Mortgage Loan (or the related Mortgaged Property)
from the Trustee at a price equal to the Purchase Price; provided, however, that
if such Document Defect or Breach is capable of being cured but not within such
90-day period and the Seller has commenced and is diligently proceeding with the
cure of such Document Defect or Breach within such 90-day period, the Seller
shall have an additional 90 days to complete such cure; and provided, further,
that with respect to such additional 90-day period the Seller shall have
delivered an Officer's Certificate to the Trustee setting forth the reason such
Document Defect or Breach is not capable of being cured within the initial
90-day period and what actions the Seller is pursuing in connection with the
cure thereof and stating
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that the Seller anticipates that such Document Defect or Breach will be cured
within the additional 90-day period. Notwithstanding the foregoing, the delivery
of a commitment to issue a policy of lender's title insurance as described in
Section 3(b)(xxvi) in lieu of the delivery of the actual policy of lender's
title insurance shall not be considered a Document Defect with respect to any
Mortgage File if such actual policy of insurance is delivered to the Trustee or
a Custodian on its behalf not later than the 90th day following the Closing
Date. The Seller's obligation to cure a Document Defect or Breach or to
repurchase any affected MLMC Mortgage Loan as described above shall constitute
the sole and exclusive remedy for a Document Defect or Breach.
SECTION 4. Representations and Warranties of the Purchaser. In order to
induce the Seller to enter into this Agreement, the Purchaser hereby represents
and warrants for the benefit of the Seller as of the date hereof that:
(a) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. The Purchaser has
the full corporate power and authority and legal right to acquire the MLMC
Mortgage Loans from the Seller and to transfer the MLMC Mortgage Loans to the
Trustee.
(b) This Agreement has been duly and validly authorized, executed
and delivered by the Purchaser, all requisite action by the Purchaser's
directors and officers has been taken in connection therewith, and (assuming the
due authorization, execution and delivery hereof by the Seller) this Agreement
constitutes the valid, legal and binding agreement of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as such enforcement
may be limited by (A) laws relating to bankruptcy, insolvency, reorganization,
receivership or moratorium, (B) other laws relating to or affecting the rights
of creditors generally, or (C) general equity principles (regardless of whether
such enforcement is considered in a proceeding in equity or at law).
(c) Except as may be required under federal or state securities laws
(and will be obtained on a timely basis), no consent, approval, authorization or
order of, registration or filing with, or notice to, any governmental authority
or court, is required, under federal or state law, for the execution, delivery
and performance by the Purchaser of or compliance by the Purchaser with this
Agreement, or the consummation by the Purchaser of any transaction described in
this Agreement.
(d) None of the acquisition of the MLMC Mortgage Loans by the
Purchaser, the transfer of the MLMC Mortgage Loans to the Trustee, and the
execution, delivery or
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performance of this Agreement by the Purchaser, conflicts or will conflict with,
results or will result in a breach of, or constitutes or will constitute a
default under (A) any term or provision of the Purchaser's Articles of
Incorporation or Bylaws, (B) any term or provision of any material agreement,
contract, instrument or indenture, to which the Purchaser is a party or by which
the Purchaser is bound, or (C) any law, rule, regulation, order, judgment, writ,
injunction or decree of any court or governmental authority having jurisdiction
over the Purchaser or its assets.
(e) Under GAAP and for federal income tax purposes, the Purchaser
will report the transfer of the MLMC Mortgage Loans by the Seller to the
Purchaser as a sale of the MLMC Mortgage Loans to the Purchaser in exchange for
consideration consisting of a cash amount equal to (A) 100% of the MLMC Balance,
plus (B) interest accrued on each MLMC Mortgage Loan at the related Mortgage
Rate, for the period from and including the Cut-off Date up to but not including
the Closing Date.
SECTION 5. Closing. The closing of the sale of the Mortgage Loans (the
"Closing") shall be held at the offices of Willkie Farr & Gallagher, One
Citicorp Center, 153 East 53rd Street, New York, New York 10022 at 10:00 A.M.,
New York time, on the Closing Date.
The Closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller set
forth in Sections 3(a), 3(b) and 3(c) of this Agreement and all of the
representations and warranties of the Purchaser set forth in Section 4 of this
Agreement shall be true and correct in all material respects as of the Closing
Date;
(b) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and acceptable to the
Purchaser, shall be duly executed and delivered by all signatories as required
pursuant to the respective terms thereof;
(c) The Seller shall have delivered and released to the Custodian
and the Master Servicer, respectively, all documents represented to have been or
required to be delivered to the Trustee and the Master Servicer pursuant to
Section 2 of this Agreement;
(d) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with and
the Seller shall have the ability to comply with all terms and
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conditions and perform all duties and obligations required to be complied with
or performed after the Closing Date; and
(e) The Seller shall have paid all fees and expenses payable by it
to the Purchaser or otherwise pursuant to this Agreement.
Both parties agree to use their best efforts to perform their
respective obligations hereunder in a manner that will enable the Purchaser to
purchase the MLMC Mortgage Loans on the Closing Date.
SECTION 6. Closing Documents. The Closing Documents shall consist of the
following:
(a) This Agreement duly executed by the Purchaser and the Seller;
(b) A Certificate of the Seller, executed by a duly authorized
officer or other authorized signatory of the Seller and dated the Closing Date,
and upon which the Purchaser and the Underwriters may rely, to the effect that:
(1) the representations and warranties of the Seller in this Agreement are true
and correct in all material respects at and as of the Closing Date with the same
effect as if made on such date; and (ii) the Seller has, in all material
respects, complied with all the agreements and satisfied all the conditions on
its part that are required under this Agreement to be performed or satisfied at
or prior to the date hereof;
(c) An Officer's Certificate from an officer of the Seller, in his
or her individual capacity, dated the Closing Date, and upon which the Purchaser
may rely, to the effect that each individual who, as an officer or
representative of the Seller, signed this Agreement or any other document or
certificate delivered on or before the Closing Date in connection with the
transactions contemplated herein, was at the respective times of such signing
and delivery, and is as of the Closing Date, duly elected or appointed,
qualified and acting as such officer or representative, and the signatures of
such persons appearing on such documents and certificates are their genuine
signatures;
(d) [Reserved].
(e) The resolutions of the board of directors of the Seller and any
requisite shareholder consent authorizing the Seller's entering into the
transactions contemplated by this Agreement (or other evidence of such
authorization acceptable to the Purchaser), the certificate of incorporation and
by-laws of the Seller, and a certificate of good standing of the Seller issued
by the Secretary of
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State of the State of Delaware not earlier than sixty (60) days prior to the
Closing Date;
(f) A written opinion of counsel for the Seller in form and
substance acceptable to the Purchaser and its counsel, with any modifications
required by the rating agencies identified in the Prospectus Supplement (the
"Rating Agencies"), dated the Closing Date and addressed to the Purchaser, the
Underwriters and each of the Rating Agencies, together with such other written
opinions as may be required by the Rating Agencies; and
(g) Such further certificates, opinions and documents as the
Purchaser may reasonably request.
SECTION 7. Indemnification.
(a) The Seller agrees to indemnify and hold harmless the Purchaser,
the Underwriters, their respective officers and directors, and each person, if
any, who controls the Purchaser or the Underwriters within the meaning of either
Section 15 of the Securities Act of 1933 (the "1933 Act") or Section 20 of the
Securities Exchange Act of 1934 (the "1934 Act"), against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the 1933 Act, the 1934 Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based in whole or in part upon any untrue statement or alleged untrue
statement of a material fact relating to the MLMC Mortgage Loans or the Seller
contained in the Sections entitled "SUMMARY-Mortgage Loan Sellers", "SUMMARY-The
Mortgage Pool" and "DESCRIPTION OF THE MORTGAGE POOL" in the Prospectus
Supplement, and in the Private Placement Memorandum insofar as the Private
Placement Memorandum incorporates such sections of the Prospectus Supplement, or
arise out of or are based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances in which they were made,
not misleading, which untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon any information furnished to the
Purchaser by the Seller or approved by the Seller, or upon any document
delivered to the Purchaser by the Seller, or upon any of the representations,
warranties, covenants or agreements of the Seller as set forth in this Agreement
(collectively, the "Seller's Information"), it being acknowledged that the
statements set forth in the Prospectus Supplement under the caption
"SUMMARY-Mortgage Loan Sellers", SUMMARY-The Mortgage Pool" and "DESCRIPTION OF
THE MORTGAGE POOL" and statements in the Private Placement Memorandum insofar as
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the Private Placement Memorandum incorporates such sections of the Prospectus
Supplement, in each case solely to the extent relating to or based (in whole or
in part) on information relating to the MLMC Mortgage Loans or the Seller, are
to be the only statements made in reliance upon information furnished or
approved by the Seller, or upon documents delivered to the Purchaser by the
Seller, or upon any of the representations, warranties, covenants or agreements
of the Seller as set forth in this Agreement.
(b) Promptly after receipt by any person entitled to indemnification
under this Section 7 (an "indemnified party") of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against the Seller (the "indemnifying party") under this Section 7, notify
the indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party will not relieve it from any liability that
it may have to any indemnified party otherwise than under this Section 7. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein, and to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel satisfactory to such indemnified party; provided, however, that if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party or parties shall have reasonably
concluded that there may be legal defenses available to it or them and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, unless (i) the indemnified party shall have
employed separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel, approved by the Purchaser, representing all the
indemnified parties under Section 7(a) who are parties to such action), (ii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action
-23-
<PAGE>
or (iii) the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party; and except that, if
clause (i) or (iii) is applicable, such liability shall only be in respect of
the counsel referred to in such clause (i) or (iii).
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under Section 7(a) hereof or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
the indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified and indemnifying parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by such parties.
(d) The Purchaser and the Seller agree that it would not be just and
equitable if contribution pursuant to Section 7(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the considerations referred to in Section 7(c) above. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in this Section 7 shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim, except where the indemnified party is required to bear such
expenses pursuant to this Section 7, which expenses the indemnifying party shall
pay as and when incurred, at the request of the indemnified party, to the extent
that the indemnifying party will be ultimately obligated to pay such expenses.
If any expenses so paid by the indemnifying party are subsequently determined to
not be required to be borne by the indemnifying party hereunder, the party that
received such payment shall promptly refund the amount so paid to the party
which made such payment. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The indemnity and contribution agreements contained in this
Section 7 shall remain operative and in
-24-
<PAGE>
full force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by the Purchaser, the Underwriters, any of their
respective directors or officers, or any person controlling the Purchaser or the
Underwriters, and (iii) acceptance of and payment for any of the Certificates.
(f) The Underwriters shall be third-party beneficiaries of the
provisions of this Section 7.
-25-
<PAGE>
SECTION 8. Costs. The Seller shall pay (or shall reimburse the Purchaser
to the extent that the Purchaser has paid) the Seller's pro rata portion of the
aggregate of the following amounts (the Seller's pro rata portion to be
determined according to the percentage that the MLMC Balance represents of the
Initial Pool Balance): (i) the costs and expenses of printing (or otherwise
reproducing) and delivering a preliminary and final Prospectus and Memorandum
relating to the Certificates; (ii) the initial fees, costs, and expenses of the
Trustee (including reasonable attorneys' fees); (iii) the filing fee charged by
the Securities and Exchange Commission for registration of the Certificates so
registered; (iv) the fees charged by the Rating Agencies to rate the
Certificates so rated; (v) the expense of recording any assignment of Mortgage
or assignment of Assignment of Leases as contemplated by Section 2 hereof; and
(vi) the cost of obtaining a "comfort letter" from a firm of certified public
accountants selected by the Purchaser with respect to numerical information in
respect of the MLMC Mortgage Loans and the Seller included in the Prospectus and
Memorandum. All other costs and expenses in connection with the transactions
contemplated hereunder shall be borne by the party incurring such expense.
SECTION 9. Notices. All notices, copies, requests, consents, demands and
other communications required hereunder shall be in writing and telecopied or
delivered to the intended recipient at the "Address for Notices" specified
beneath its name on the signature pages hereof or, as to either party, at such
other address as shall be designated by such party in a notice hereunder to the
other party. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 10. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement, incorporated herein by reference or contained in the certificates of
officers of the Seller submitted pursuant hereto, shall remain operative and in
full force and effect and shall survive delivery of the MLMC Mortgage Loans by
the Seller to the Purchaser (and by the Purchaser to the Trustee).
SECTION 11. Severability of Provisions. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
which is held to be void or unenforceable shall be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation, warranty or covenant of
this Agreement that is prohibited or unenforceable or is held to be void or
unenforceable in any particular jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such
-26-
<PAGE>
prohibition or unenforceability in any particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. To
the extent permitted by applicable law, the parties hereto waive any provision
of law which prohibits or renders void or unenforceable any provision hereof.
SECTION 12. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but which together shall
constitute one and the same agreement.
SECTION 13. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES,
OBLIGATIONS AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED IN
ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF NEW YORK. THE PARTIES HERETO
INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 14. Further Assurances. The Seller and the Purchaser agree to
execute and deliver such instruments and take such further actions as the other
party may, from time to time, reasonably request in order to effectuate the
purposes and to carry out the terms of this Agreement.
SECTION 15. Successors and Assigns. The rights and obligations of the
Seller under this Agreement shall not be assigned by the Seller without the
prior written consent of the Purchaser, except that any person into which the
Seller may be merged or consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Seller is a party, or any
person succeeding to all or substantially all of the business of the Seller,
shall be the successor to the Seller hereunder. The Purchaser has the right to
assign its interest under this Agreement, in whole or in part, as may be
required to effect the purposes of the Pooling and Servicing Agreement, and the
assignee shall, to the extent of such assignment, succeed to the rights and
obligations hereunder of the Purchaser. Subject to the foregoing, this Agreement
shall bind and inure to the benefit of and be enforceable by the Seller and the
Purchaser, and their permitted successors and assigns, and the officers,
directors and controlling persons referred to in Section 7.
SECTION 16. Amendments. No term or provision of this Agreement may be
waived or modified unless such waiver or modification is in writing and signed
by a duly authorized officer of the party against whom such waiver or
modification is sought to be enforced.
-27-
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective duly authorized officers as of the
date first above written.
SELLER
MERRILL LYNCH MORTGAGE CAPITAL INC.
By: /s/ Robert J. Fitzpatrick
------------------------------------
Name: Robert J. Fitzpatrick
Title: Vice President
Address for Notices:
100 Church Street, 18th Floor
New York, New York 10080-6518
Attention:
Telecopier No.: (212) 602-7552
Telephone No.: (212) 602-7501
PURCHASER
MERRILL LYNCH MORTGAGE
INVESTORS, INC.
By: /s/ Bruce L. Ackerman
------------------------------------
Name: Bruce L. Ackerman
Title: Vice President
Address for Notices:
World Financial Center
New York, New York 10281
Attention:
Telecopier No.: (212) 449-7684
Telephone No.: (212) 449-5849
-28-
<PAGE>
<TABLE>
EXHIBIT A
MLMI-C1
MERRILL LYNCH
MORTGAGE LOAN SCHEDULE
<CAPTION>
Control
Number Property_Name Address City State
------ ------------- ------- ---- -----
<S> <C> <C> <C> <C>
1 INT - The Crescent City Apartments 8501 Broadway Street Houston TX
2 INT - The Park Apartments 4040 Schannen Boulevard Corpus Christi TX
3 PP-Days Inn-Cody 524 Yellowstone Cody WY
4 Days Inn-Norfolk 1001 Omaha Norfolk NE
5 Towne Center Apartments 65 East Olive Gilbert AZ
6 Ramada Limited - Austin 9102 Burnett Road Austin TX
7 Sunrise Commons Apartments 8123 Sunrise Boulevard Citrus Heights CA
8 IRM-Meadow Lakes Apartments 1401 Lakewood Ave Modesto CA
9 Diablo View Apartments 4265 Clayton Road Concord CA
10 IRM-Glenbrook Apartments 8725 La Riviera Drive Sacramento CA
11 Casa Del Sol Apartments 14250 Borego Road Victorville CA
12 Rush Creek Apartments 2625 Community Drive Dallas TX
13 Northaven Apartments 11457 Dennis Road Dallas TX
14 Salvio Pacheco Square 2151 Salvio Concord CA
15 Roosevelt Center 2800-2820 Roosevelt Street Carlsbad CA
16 Eastgate Square Shopping Center 164 U.S. Highway 17 East Palatka FL
17 Lochwood Apartments 11117 Lochwood Boulevard Dallas TX
18 Southpoint Apartments 4002 E. Southern Ave. Phoenix AZ
19 MacArthur Crossing 7750 North MacArthur Blvd. Irving TX
20 Carondelet Building 7710-7730 Carondelet Avenue Clayton MO
21 Guild Building 7912 Bonhomme Ave. St. Louis MO
22 Lease-All Orangethorpe 920-980 E. Orangethorpe Ave. Anaheim CA
23 Lease-All Anaheim 1550-1600 South Anaheim Blvd. Anaheim CA
24 Westlake Business Center 31200 - 31220 La Baya Drive Westlake Village CA
25 Oregon Building 494 State Street Salem OR
26 Riverview Apartments 2111 West 17th Street Santa Ana CA
27 Walnut Woods Apartments 275 E. Minnesota Avenue Turlock CA
28 Creekside Gardens Apartments 300 Bel Air Drive Vacaville CA
29 Willowbrook Business Park 11515 - 11555 SW Durham Road Tigard OR
30 Callens Corner Phase II 18637-18729 Brookhurst Street Fountain Valley CA
31 Driftwood Apartments 800 West Grant Line Road Tracy CA
32 Lincoln Village Apartments 2211 W. Campbell Avenue Phoenix AZ
33 Country Glen Apartments 7575 Power Inn Road Sacramento CA
34 Mountain Park Apartments 1350-1421 Custer Avenue Atlanta GA
35 Foxworth Apartments 4789 Manzanita Avenue Carmichael CA
36 New Peachtree Apartments 3354 Burk Drive Chamblee GA
37 Ashdale Garden Apartments 2450 Ashdale Drive Austin TX
38 Western Apartments 411 North Avenue Trinidad CO
39 The Highlands Apartments 11201 Lake Highlands Drive Dallas TX
40 10 Corporate Park 10 Corporate Park Irvine CA
41 SCO Training Facility 400 Encinal Street Santa Cruz CA
42 McCallum Meadows Apts. 7760 McCallum Blvd. Dallas TX
43 Shilo Inn-Bend 3105 O.B. Riley Road Bend OR
44 Shilo Inn-Coeur d'Alene 702 W. Appleway Coeur d'Alene ID
45 Shilo Inn-Nampa 1401 Shilo Drive Nampa ID
46 Plaza Las Palmas West Valley Parkway Escondido CA
47 Shilo Inn-Tillamook 2515 N. Main Tillamook OR
48 Shilo Inn-Salt Lake City 206 South West Temple Salt Lake City UT
49 Shilo Inn-Elko 2401 Mountain City Highway Elko NV
50 Crosspointe Plaza 799 New Haven Road Naugatuck CT
51 Back Bay Court 3601 Jamboree Road Newport Beach CA
52 Park Central 7901-7963 Central Ave. Capitol Heights MD
53 Lindberg Station 711 Morosgo Drive, N.E. Atlanta GA
54 Westway Business Plaza 8000 Harwin Drive Houston TX
55 Hastings Ranch Plaza 3801-3883 E. Foothill Bl. Pasadena CA
56 Pirani Best Western - Airport Executel 20717 Pacific Highway South Seattle WA
57 Best Western - Federal Way Executel 31611 20th Avenue South Federal Way WA
58 Blue Mountain View Apartments 150 South Wilbur Walla Walla WA
59 Ramada Inn 5526 North Interstate 35 North Austin TX
60 Waterford Marketplace 503-555 Capital Expressway San Jose CA
61 Union Square Shopping Center Union Deposit Road Harrisburg PA
62 Club Secane Apartments 100 Oak Lane Darby Township PA
63 Bryton Hill Manor Apartments 519 South Richey Pasadena TX
64 Greeley Super 8 Motel 2423 West 29th Street Greeley CO
65 Meridian Executive Center 815 NW 57th Avenue Miami FL
66 North View Business Center 4665 North Avenue Oceanside CA
67 Palisades Business Park Summit Avenue Plano TX
68 Maple Leaf Building 23 East Street Cambridge MA
69 Centlivre Village Apartments 2903 Westbrook Drive Ft. Wayne IN
70 Pinewood Place Mobile Home Park 8539 Monterey Pine Place Tomball TX
71 Southbrooke Manor 1105 West Main Street Edna (Victoria) TX
72 Hampton Inn-Anderson 120 Interstate Boulevard Anderson SC
73 Creekview Apartments 151 Little Creek Road Cedar Hill TX
74 The Marketplace in University City 3202-3368 Governor Drive San Diego CA
75 Greenview Apartments 7141 North 16th Street Phoenix AZ
76 Whitemarsh Shopping Center Ridge Pike & Butler Pike Montgomery County PA
77 Hampton Inn - Houston 20035 N.W. Freeway Houston TX
78 Holiday Inn Express 1610 W. Nugent Avenue Temple TX
79 Telstar Apartments 510 Westmount Dallas TX
80 Mill Run Apartments 2732 W. Colorado Dallas TX
<CAPTION>
Remaining
Control Original Cut-off Date Monthly Gross ----------- Maturity Ground
Number Zip Code Balance Balance Payment Rate Term Amort Date Lease
------ -------- ----------- -------------- ----------- ----- ----- ----- ------ -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 77061 $ 4,700,000 $ 4,684,339.29 $ 34,815.14 8.100 55 355 1/1/02 No
2 78413 $ 4,080,000 $ 4,058,608.87 $ 31,760.86 8.100 55 295 1/1/02 No
3 82414 $ 1,600,000 $ 1,593,543.56 $ 15,334.49 9.900 237 237 3/1/17 No
4 68701 $ 1,610,000 $ 1,603,503.21 $ 15,430.33 9.900 237 237 3/1/17 No
5 85234 $ 4,150,000 $ 4,142,388.64 $ 31,880.50 8.490 117 357 3/1/07 No
6 78758 $ 1,400,000 $ 1,389,663.91 $ 12,803.99 9.230 235 235 1/1/17 No
7 95610 $ 5,624,000 $ 5,610,169.98 $ 43,164.00 8.480 80 356 2/1/04 No
8 95354 $ 5,516,000 $ 5,502,435.57 $ 42,335.11 8.480 80 356 2/1/04 No
9 94521 $ 3,098,000 $ 3,090,381.68 $ 23,777.04 8.480 80 356 2/1/04 No
10 95826 $ 6,280,000 $ 6,264,556.80 $ 48,198.78 8.480 80 356 2/1/04 No
11 92392 $ 1,200,000 $ 1,195,781.32 $ 9,440.40 8.750 114 354 12/1/06 No
12 75220 $ 4,200,000 $ 4,187,764.97 $ 33,904.49 8.530 117 297 3/1/07 No
13 75229 $ 5,000,000 $ 4,984,185.50 $ 39,869.56 8.630 116 320 2/1/07 No
14 94520 $ 7,800,000 $ 7,770,811.96 $ 62,238.67 8.690 79 325 1/1/04 No
15 92008 $ 3,150,000 $ 3,136,042.12 $ 26,715.67 9.130 115 295 1/1/07 No
16 32131 $ 1,376,000 $ 1,371,084.16 $ 11,603.93 9.060 116 296 2/1/07 No
17 75218 $ 2,180,000 $ 2,173,659.83 $ 17,612.75 8.540 81 297 3/1/04 No
18 85040 $ 2,800,000 $ 2,793,657.66 $ 22,288.09 8.880 116 356 2/1/07 No
19 75063 $ 9,850,000 $ 9,803,536.17 $ 80,981.15 8.750 115 295 1/1/07 No
20 63105 $ 3,550,000 $ 3,533,634.63 $ 29,524.52 8.890 79 295 1/1/04 No
21 63105 $ 850,000 $ 846,081.53 $ 7,069.25 8.890 79 295 1/1/04 No
22 92801 $ 2,850,000 $ 2,835,715.10 $ 23,299.14 8.970 113 323 11/1/06 No
23 92805 $ 5,509,000 $ 5,482,701.83 $ 44,853.24 8.970 113 329 11/1/06 No
24 91361 $ 1,600,000 $ 1,592,315.47 $ 13,034.93 8.640 115 295 1/1/07 No
25 97301 $ 1,000,000 $ 998,025.35 $ 8,436.45 9.340 117 327 3/1/07 No
26 92706 $ 9,635,000 $ 9,616,136.91 $ 71,843.37 8.170 57 357 3/1/02 No
27 95832 $ 3,580,000 $ 3,573,298.36 $ 27,248.50 8.390 81 357 3/1/04 No
28 95687 $ 7,600,000 $ 7,585,773.05 $ 57,845.98 8.390 81 357 3/1/04 No
29 97223 $ 1,930,000 $ 1,926,718.19 $ 16,608.15 9.310 118 298 4/1/07 No
30 92708 $ 4,087,500 $ 4,081,391.57 $ 32,473.26 8.640 118 328 4/1/07 Yes
31 95376 $ 3,650,000 $ 3,645,376.46 $ 27,549.64 8.300 82 358 4/1/04 No
32 85015 $ 2,200,000 $ 2,195,915.21 $ 16,807.08 8.430 117 357 3/1/07 No
33 95828 $ 2,700,000 $ 2,696,607.69 $ 20,455.28 8.340 82 358 4/1/04 No
34 30316 $ 2,250,000 $ 2,245,896.91 $ 18,712.72 8.890 118 298 4/1/07 No
35 95608 $ 2,130,000 $ 2,127,285.30 $ 16,031.94 8.270 82 358 4/1/04 No
36 30341 $ 1,850,000 $ 1,846,512.95 $ 15,134.32 8.690 118 298 4/1/07 No
37 78757 $ 1,400,000 $ 1,396,585.29 $ 10,784.64 8.520 116 356 2/1/07 No
38 81082 $ 1,200,000 $ 1,195,368.11 $ 9,735.61 8.590 116 296 2/1/07 No
39 75218 $ 4,200,000 $ 4,192,468.81 $ 32,592.49 8.600 117 357 3/1/07 No
40 92714 $ 2,390,000 $ 2,386,259.71 $ 18,573.71 8.390 58 328 4/1/02 No
41 95060 $ 4,600,000 $ 4,592,164.98 $ 39,552.39 9.300 142 298 4/1/09 No
42 75252 $ 6,500,000 $ 6,488,272.56 $ 50,302.19 8.570 117 357 3/1/07 No
43 97701 $ 6,650,000 $ 6,580,645.53 $ 60,775.90 9.220 233 233 11/1/16 No
44 83814 $ 5,740,000 $ 5,680,136.14 $ 52,459.20 9.220 233 233 11/1/16 No
45 83687 $ 4,480,000 $ 4,433,276.99 $ 40,943.77 9.220 233 233 11/1/16 No
46 92029 $10,750,000 $10,733,361.32 $ 83,988.07 8.450 142 328 4/1/09 No
47 97141-9246 $ 5,040,000 $ 4,987,436.61 $ 46,061.74 9.220 233 233 11/1/16 No
48 84101 $11,200,000 $11,083,192.48 $102,359.42 9.220 233 233 11/1/16 No
49 89801 $ 3,440,000 $ 3,404,123.40 $ 31,438.96 9.220 233 233 11/1/16 No
50 06770 $ 6,586,000 $ 6,573,483.41 $ 53,655.05 8.640 82 298 4/1/04 No
51 92660 $ 6,500,000 $ 6,490,778.60 $ 52,910.29 8.920 118 328 4/1/07 No
52 20743 $ 2,030,000 $ 2,018,082.81 $ 17,750.16 9.510 113 293 11/1/06 No
53 30324 $ 1,100,000 $ 1,093,308.80 $ 8,731.84 8.330 114 294 12/1/06 No
54 77036 $ 2,600,000 $ 2,579,176.46 $ 26,324.55 8.970 177 177 3/1/12 No
55 91107 $ 8,200,000 $ 8,170,699.56 $ 66,863.42 8.940 235 325 1/1/17 Yes
56 98198 $ 4,075,000 $ 4,039,703.22 $ 37,824.83 9.440 234 234 12/1/16 No
57 98003 $ 4,825,000 $ 4,783,206.88 $ 44,786.45 9.440 234 234 12/1/16 No
58 99362 $ 1,975,000 $ 1,966,969.08 $ 15,622.04 8.810 113 353 11/1/06 No
59 78751 $ 3,300,000 $ 3,276,333.88 $ 30,674.18 9.460 235 235 1/1/17 No
60 95136 $ 4,400,000 $ 4,380,206.45 $ 35,139.64 8.700 114 324 12/1/06 No
61 17109 $15,000,000 $14,926,238.37 $117,953.45 8.470 78 318 12/1/03 No
62 19036 $ 1,400,000 $ 1,391,566.25 $ 11,169.59 8.390 114 294 12/1/06 No
63 77506 $ 5,500,000 $ 5,472,216.85 $ 43,659.18 8.330 55 295 1/1/02 No
64 80631 $ 1,540,000 $ 1,529,382.21 $ 14,627.43 9.770 235 235 1/1/17 No
65 33026 $ 4,833,000 $ 4,806,120.49 $ 40,161.95 8.880 54 294 12/1/01 No
66 92056 $ 3,400,000 $ 3,389,511.74 $ 26,094.88 8.480 79 355 1/1/04 No
67 75074 $ 3,100,000 $ 3,084,841.48 $ 25,024.74 8.530 115 295 1/1/07 No
68 02141 $ 4,400,000 $ 4,384,487.71 $ 37,347.38 9.140 176 296 2/1/12 No
69 46805 $ 5,400,000 $ 5,384,061.91 $ 43,300.46 8.450 117 297 3/1/07 No
70 77375 $ 2,000,000 $ 1,988,821.84 $ 16,578.97 8.850 114 294 12/1/06 No
71 77957 $ 3,500,000 $ 3,488,182.96 $ 30,336.44 9.400 116 296 2/1/07 No
72 29621 $ 2,542,000 $ 2,528,142.84 $ 24,245.23 9.830 236 236 2/1/17 No
73 75104 $ 1,650,000 $ 1,648,137.35 $ 13,110.40 8.860 178 358 4/1/12 No
74 92122 $ 7,200,000 $ 7,187,021.65 $ 60,225.04 8.960 118 298 4/1/07 No
75 85020 $ 1,850,000 $ 1,846,460.88 $ 15,021.58 8.600 118 298 4/1/07 No
76 19428 $ 7,250,000 $ 7,245,767.97 $ 56,673.70 8.680 119 359 5/1/07 No
77 77065 $ 2,400,000 $ 2,397,343.24 $ 21,916.76 9.630 263 263 5/1/19 No
78 76504 $ 2,100,000 $ 2,097,162.02 $ 19,987.98 9.800 239 239 5/1/17 No
79 75211 $ 988,000 $ 987,127.50 $ 8,331.89 9.060 179 299 5/1/12 No
80 75211 $ 1,230,000 $ 1,228,913.80 $ 10,372.70 9.060 179 299 5/1/12 No
<CAPTION>
Control Underwriting Net Subservicing (1)Servicing
Number Reserves Rate Fees Fees Subservicer
------ ------------------ ----- ------------ ----- -------------
<S> <C> <C> <C> <C> <C>
1 225 per unit 8.035 0.060 0.065 L.J. Melody & Co.
2 265 per unit 8.035 0.060 0.065 L.J. Melody & Co.
3 4% of gross rev. 9.895 0.000 0.005 GE Capital Asset Management
4 4% of gross rev. 9.895 0.000 0.005 GE Capital Asset Management
5 270 per unit 8.485 0.000 0.005 GE Capital Asset Management
6 4% of gross rev. 9.225 0.000 0.005 GE Capital Asset Management
7 321 per unit 8.415 0.060 0.065 L.J. Melody & Co.
8 250 per unit 8.415 0.060 0.065 L.J. Melody & Co.
9 250 per unit 8.415 0.060 0.065 L.J. Melody & Co.
10 290 per unit 8.415 0.060 0.065 L.J. Melody & Co.
11 200 per unit 8.685 0.060 0.065 L.J. Melody & Co.
12 250 per unit 8.525 0.000 0.005 GE Capital Asset Management
13 286 per unit 8.625 0.000 0.005 GE Capital Asset Management
14 0.15 per sq. ft. 8.625 0.060 0.065 L.J. Melody & Co.
15 0.15 per sq. ft. 9.125 0.000 0.005 GE Capital Asset Management
16 0.15 per sq. ft. 9.055 0.000 0.005 GE Capital Asset Management
17 300 per unit 8.535 0.000 0.005 GE Capital Asset Management
18 250 per unit 8.815 0.060 0.065 L.J. Melody & Co.
19 0.15 per sq. ft. 8.745 0.000 0.005 GE Capital Asset Management
20 0.15 per sq. ft. 8.885 0.000 0.005 GE Capital Asset Management
21 0.15 per sq. ft. 8.885 0.000 0.005 GE Capital Asset Management
22 0.18 per sq. ft. 8.905 0.060 0.065 L.J. Melody & Co.
23 0.18 per sq. ft. 8.905 0.060 0.065 L.J. Melody & Co.
24 0.19 per sq. ft. 8.635 0.000 0.005 GE Capital Asset Management
25 0.24 per sq. ft. 9.275 0.060 0.065 Key Corp
26 250 per unit 8.165 0.000 0.005 GE Capital Asset Management
27 263 per unit 8.325 0.060 0.065 L.J. Melody & Co.
28 301 per unit 8.325 0.060 0.065 L.J. Melody & Co.
29 0.15 per sq. ft. 9.305 0.000 0.005 GE Capital Asset Management
30 0.15 per sq. ft. 8.575 0.060 0.065 L.J. Melody & Co.
31 250 per unit 8.235 0.060 0.065 L.J. Melody & Co.
32 253 per unit 8.425 0.000 0.005 GE Capital Asset Management
33 250 per unit 8.275 0.060 0.065 L.J. Melody & Co.
34 250 per unit 8.885 0.000 0.005 GE Capital Asset Management
35 250 per unit 8.205 0.060 0.065 L.J. Melody & Co.
36 250 per unit 8.685 0.000 0.005 GE Capital Asset Management
37 250 per unit 8.515 0.000 0.005 GE Capital Asset Management
38 250 per unit 8.585 0.000 0.005 GE Capital Asset Management
39 200 per unit 8.595 0.000 0.005 GE Capital Asset Management
40 0.15 per sq. ft. 8.325 0.060 0.065 L.J. Melody & Co.
41 0.15 per sq. ft. 9.295 0.000 0.005 GE Capital Asset Management
42 250 per unit 8.565 0.000 0.005 GE Capital Asset Management
43 4% of gross rev. 9.155 0.060 0.065 Key Corp
44 4% of gross rev. 9.155 0.060 0.065 Key Corp
45 4% of gross rev. 9.155 0.060 0.065 Key Corp
46 0.22 per sq. ft. 8.445 0.000 0.005 GE Capital Asset Management
47 4% of gross rev. 9.155 0.060 0.065 Key Corp
48 4% of gross rev. 9.155 0.060 0.065 Key Corp
49 4% of gross rev. 9.155 0.060 0.065 Key Corp
50 0.15 per sq. ft. 8.635 0.000 0.005 GE Capital Asset Management
51 0.15 per sq. ft. 8.915 0.000 0.005 GE Capital Asset Management
52 0.15 per sq. ft. 9.505 0.000 0.005 GE Capital Asset Management
53 250 per unit 8.325 0.000 0.005 GE Capital Asset Management
54 0.15 per sq. ft. 8.905 0.060 0.065 L.J. Melody & Co.
55 0.15 per sq. ft. 8.875 0.060 0.065 L.J. Melody & Co.
56 4% of gross rev. 9.375 0.060 0.065 L.J. Melody & Co.
57 4% of gross rev. 9.375 0.060 0.065 L.J. Melody & Co.
58 250 per unit 8.805 0.000 0.005 GE Capital Asset Management
59 4% of gross rev. 9.455 0.000 0.005 GE Capital Asset Management
60 0.15 per sq. ft. 8.635 0.060 0.065 L.J. Melody & Co.
61 0.18 per sq. ft. 8.465 0.000 0.005 GE Capital Asset Management
62 250 per unit 8.385 0.000 0.005 GE Capital Asset Management
63 250 per unit 8.265 0.060 0.065 L.J. Melody & Co.
64 4% of gross rev. 9.765 0.000 0.005 GE Capital Asset Management
65 0.15 per sq. ft. 8.815 0.060 0.065 L.J. Melody & Co.
66 0.15 per sq. ft. 8.475 0.000 0.005 GE Capital Asset Management
67 0.15 per sq. ft. 8.525 0.000 0.005 GE Capital Asset Management
68 0.15 per sq. ft. 9.135 0.000 0.005 GE Capital Asset Management
69 250 per unit 8.445 0.000 0.005 GE Capital Asset Management
70 50 per pad 8.845 0.000 0.005 GE Capital Asset Management
71 250 per bed 9.395 0.000 0.005 GE Capital Asset Management
72 4% of gross rev. 9.825 0.000 0.005 GE Capital Asset Management
73 200 per unit 8.855 0.000 0.005 GE Capital Asset Management
74 0.15 per sq. ft. 8.955 0.000 0.005 GE Capital Asset Management
75 250 per unit 8.595 0.000 0.005 GE Capital Asset Management
76 0.15 per sq. ft. 8.675 0.000 0.005 GE Capital Asset Management
77 4% of gross rev. 9.625 0.000 0.005 GE Capital Asset Management
78 4% of gross rev. 9.795 0.000 0.005 GE Capital Asset Management
79 250 per unit 9.055 0.000 0.005 GE Capital Asset Management
80 250 per unit 9.055 0.000 0.005 GE Capital Asset Management
</TABLE>
-29-
<PAGE>
<TABLE>
MLMI 1997-C1
MORTGAGE LOAN SCHEDULE
MERRILL LYNCH
<CAPTION>
Control
Number Property_Name Address City State
------ ------------- ------- ---- -----
<S> <C> <C> <C> <C>
81 Aldrich Plaza Route #9 Howell Township NJ
82 Ho Jo Inn - Wilmington 3901 Market Street Wilmington NC
83 Springwood Apartments 410 Sulphur Springs Road Greenville SC
84 Woodley Downs Apartments 3923 Wodley Road Montgomery AL
85 Rowland Heights Shopping Ctr NWC of Nogales & Pomona Fwy Rowland Heights CA
86 Goose Creek Plaza S. C. 6900 Garth Road Baytown TX
87 Oaks of Arlington Apartments 2100 Ascension Arlington TX
88 Quail Meadows Apartments 10201 Telephone Road Houston TX
89 Sherwood Court Apartments 4503-4531 McPherson Ave. St Louis MO
90 Three Fountains Apartments 2400 Buffalo Gap Rd Abilene TX
91 Avenel Blockbuster 1392 Route 35 North Woodbridge NJ
92 St. Augustine Beach Holiday Inn 860 State Road A1A St. Augustine Beach FL
93 Barkwood Apartments 5050 Yale Houston TX
94 Wing Ong Plaza Thomas Road Phoenix AZ
95 Parkside Aparments 325 W. 5th Avenue Mesa AZ
96 Ridgeway Village Apartments 6033 W. Bethany Home Rd. Glendale AZ
97 The Trails Apartments - Multifamily 3109 Chapel Creek Drive Dallas TX
98 Crestridge Apartments 6417 Ridgecrest Road Dallas TX
99 Comfort Inn - Richardson 220 W. Spring Valley Road Richardson TX
100 Cherrywood Square Apartments 6077 S. Norcross Tucker Road Norcross GA
101 Elkins Park Square 8080 Old York Road Cheltenham Township PA
102 Fairfield Inn by Marriott 150 Crossways Boulevard Chesapeake VA
103 Wildwood Apartments 3321 Peppertree Circle Decatur GA
104 Thunderbird Business Park 3001 West Indian School Phoenix AZ
105 Long Beach Avenue 1250 Long Beach Avenue Los Angeles CA
106 Ball Park Inn - Arlington 903 N. Collins Arlington TX
107 Best Western Inn 13700 LBJ Freeway Garland TX
108 Holiday Inn Express-Plano 5021 West Plano Parkway Plano TX
109 Quality Inn/Airport 5575 West Amelia Earhart Drive Salt Lake City UT
110 Cinnamon Tree Apartments 111 South 1400 West Cedar City UT
111 BDR - Francis Court III - Multifamily 1621 West Rialto Avenue Rialto CA
112 BDR - Francis Court IV - Multifamily 1680 West Rialto Avenue Rialto CA
113 BDR - Francis Court V - Multifamily 160 N. Linden Avenue Rialto CA
114 Whispering Oaks Apartments 10010 Greenfork Drive Houston TX
115 BDR - Sierra Point Apartments 1439 North Lilac Avenue Rialto CA
116 Falls of Maplewood Apts. 9600 Glenfield Court Houston TX
117 Huntington Apartments 5700 Boca Raton Blvd. Fort Worth TX
118 Greenfield Apartments 2105 Cedar Bayou Baytown TX
119 Moors Landing Apartments 294 Merion Avenue Carney's Point NJ
120 Best Western - Park Suites 640 Park Blvd East Plano TX
121 Comfort Inn - Plano 621 Central Parkway East Plano TX
122 Parkwood Apartments 2450 Peach Tree Drive Fairfield CA
123 Peachwood Apartments 2215 Peach Tree Drive Fairfield CA
124 Days Inn-Union City 6840 Shannon Pkwy South Union City GA
125 Riverview Manor Apartments 715-903 Donaldson Street Highland Park NJ
126 Kasco Industrial Portfolio Various El Paso TX
127 Best Western-Courtyard Inn 1225 Janesville Ave Ft. Atkinson WI
128 Super 8 - Whitewater, WI 917 E. Milwaukee Ave. Whitewater WI
129 Pompano Plaza 1401 South Federal Highway Pompano Beach FL
130 Lincoln Menlo Phase VIII 1003-1005 Hamilton Court Menlo Park CA
131 AAAAA Rent-A-Space - Foster City 1221 E. Hillsdale Blvd Foster City CA
132 AAAAA Rent-A-Space - Colma 3601 Junipero Serra Colma CA
133 Caruth Plaza Shopping 9000 N. Central Expressway Dallas TX
<CAPTION>
Remaining
Control Original Cut-off Date Monthly Gross ----------- Maturity Ground
Number Zip Code Balance Balance Payment Rate Term Amort Date Lease
------ -------- ----------- -------------- ----------- ----- ----- ----- ------ -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
81 07731 $ 7,000,000 $ 6,996,348.17 $ 57,435.16 9.220 119 359 5/1/07 No
82 28403 $ 1,223,000 $ 1,220,097.70 $ 13,277.42 10.180 179 179 5/1/12 No
83 29617 $ 2,000,000 $ 1,998,865.89 $ 15,834.10 8.820 119 359 5/1/07 No
84 36116 $ 1,450,000 $ 1,448,689.32 $ 12,089.01 8.920 179 299 5/1/12 No
85 91748 $12,800,000 $12,792,920.42 $102,439.58 8.940 119 359 5/1/07 Yes
86 77521 $ 2,070,000 $ 2,068,293.37 $ 18,042.37 9.470 119 299 5/1/07 No
87 76006 $ 4,520,000 $ 4,517,284.23 $ 34,883.10 8.540 119 359 5/1/07 No
88 77471 $ 3,200,000 $ 3,197,059.05 $ 26,460.95 8.820 119 299 5/1/07 No
89 63108 $ 1,160,000 $ 1,159,372.95 $ 9,375.39 9.050 119 359 5/1/07 No
90 79605 $ 1,600,000 $ 1,598,608.12 $ 13,591.87 9.150 119 299 5/1/07 No
91 07001 $ 1,480,000 $ 1,478,723.24 $ 12,623.43 9.200 83 299 5/1/04 No
92 32084 $ 4,580,000 $ 4,536,489.76 $ 44,076.68 9.960 233 233 11/1/16 No
93 77018 $ 2,475,000 $ 2,458,535.06 $ 20,348.05 8.750 77 293 11/1/03 No
94 85006 $ 1,625,000 $ 1,618,160.63 $ 14,129.85 9.440 115 295 1/1/07 No
95 85201 $ 1,750,000 $ 1,743,189.69 $ 14,138.68 8.540 116 296 2/1/07 No
96 85301 $ 3,500,000 $ 3,491,410.70 $ 26,887.17 8.490 116 356 2/1/07 No
97 75220 $ 3,600,000 $ 3,586,707.87 $ 27,706.40 8.510 174 354 12/1/11 No
98 75231 $ 800,000 $ 799,530.11 $ 6,236.55 8.650 59 359 5/1/02 No
99 75081 $ 1,800,000 $ 1,800,000.00 $ 16,754.86 9.480 240 240 6/1/17 No
100 30093 $ 1,950,000 $ 1,950,000.00 $ 15,992.07 8.720 120 300 6/1/07 No
101 19027 $ 3,600,000 $ 3,600,000.00 $ 29,842.15 8.850 120 300 6/1/07 No
102 23320 $ 3,600,000 $ 3,600,000.00 $ 33,041.23 9.280 240 240 6/1/17 No
103 30034 $ 2,567,000 $ 2,564,755.70 $ 21,753.50 9.120 299 299 5/1/22 No
104 85017 $ 3,845,000 $ 3,841,643.96 $ 32,610.08 9.130 83 299 5/1/04 No
105 90021 $ 5,060,000 $ 5,060,000.00 $ 38,799.49 8.470 120 360 6/1/07 No
106 76011 $ 2,250,000 $ 2,233,884.43 $ 20,928.89 9.470 235 235 1/1/17 No
107 75041 $ 2,600,000 $ 2,581,377.56 $ 24,184.50 9.470 235 235 1/1/17 No
108 75093 $ 2,780,000 $ 2,759,215.55 $ 25,245.28 9.130 235 235 1/1/17 No
109 84116 $ 6,370,000 $ 6,316,541.50 $ 60,169.32 9.690 234 234 12/1/16 No
110 84720 $ 1,470,000 $ 1,456,255.74 $ 13,065.68 8.830 234 234 12/1/16 No
111 92376 $ 1,350,000 $ 1,344,881.93 $ 10,265.74 8.380 114 354 12/1/06 No
112 92376 $ 850,000 $ 846,777.51 $ 6,463.61 8.380 114 354 12/1/06 No
113 92376 $ 1,500,000 $ 1,494,313.26 $ 11,406.38 8.380 114 354 12/1/06 No
114 77036 $ 1,560,000 $ 1,552,446.14 $ 12,656.30 8.590 115 295 1/1/07 No
115 92376 $ 2,020,000 $ 2,015,348.32 $ 15,963.54 8.800 116 356 2/1/07 No
116 77096 $ 1,550,000 $ 1,544,172.07 $ 12,743.23 8.750 80 296 2/1/04 No
117 76112 $ 2,510,000 $ 2,508,438.30 $ 19,068.96 8.370 59 359 5/1/02 No
118 77520 $ 2,580,000 $ 2,578,440.24 $ 19,856.26 8.510 119 359 5/1/07 No
119 08069 $ 3,000,000 $ 3,000,000.00 $ 24,399.89 8.620 120 300 6/1/07 No
120 75074 $ 2,750,000 $ 2,750,000.00 $ 25,293.38 9.310 240 240 6/1/17 No
121 75074 $ 1,750,000 $ 1,750,000.00 $ 16,095.78 9.310 240 240 6/1/17 No
122 94533 $ 3,955,000 $ 3,955,000.00 $ 29,796.05 8.280 84 360 6/1/04 No
123 94533 $ 2,250,000 $ 2,250,000.00 $ 16,950.98 8.280 84 360 6/1/04 No
124 30294 $ 2,500,000 $ 2,500,000.00 $ 23,417.68 9.570 240 240 6/1/17 No
125 08904 $ 2,600,000 $ 2,600,000.00 $ 21,216.98 8.660 120 300 6/1/07 No
126 79906 $ 9,500,000 $ 9,500,000.00 $77,665.94 8.920 120 324 6/1/07 Yes
127 53538 $ 1,750,000 $ 1,750,000.00 $ 15,781.15 9.460 264 264 6/1/19 No
128 53190 $ 1,700,000 $ 1,700,000.00 $ 15,444.32 9.560 264 264 6/1/19 No
129 33062 $ 3,250,000 $ 3,250,000.00 $ 26,852.28 8.810 120 300 6/1/07 No
130 94025 $ 5,400,000 $ 5,400,000.00 $ 43,810.26 8.590 84 300 6/1/04 No
131 94404 $ 5,690,000 $ 5,690,000.00 $ 49,990.49 9.570 300 300 6/1/22 No
132 94014 $10,550,000 $10,550,000.00 $ 92,688.87 9.570 300 300 6/1/22 No
133 75215 $11,770,000 $11,770,000.00 $ 91,085.67 8.570 120 360 6/1/07 No
<CAPTION>
Control Underwriting Net Subservicing (1)Servicing
Number Reserves Rate Fees Fees Subservicer
------ ------------------ ----- ------------ ----- -------------
<S> <C> <C> <C> <C> <C>
81 0.15 per sq. ft. 9.215 0.000 0.005 GE Capital Asset Management
82 4% of gross rev. 10.175 0.000 0.005 GE Capital Asset Management
83 303.39 per unit 8.815 0.000 0.005 GE Capital Asset Management
84 250 per unit 8.915 0.000 0.005 GE Capital Asset Management
85 0.15 per sq. ft. 8.935 0.000 0.005 GE Capital Asset Management
86 0.16 per sq. ft. 9.465 0.000 0.005 GE Capital Asset Management
87 225 per unit 8.535 0.000 0.005 GE Capital Asset Management
88 250 per unit 8.755 0.060 0.065 L.J. Melody & Co.
89 200 per unit 9.045 0.000 0.005 GE Capital Asset Management
90 275 per unit 9.145 0.000 0.005 GE Capital Asset Management
91 0.15 per sq. ft. 9.135 0.060 0.065 L.J. Melody & Co.
92 4% of gross rev. 9.895 0.060 0.065 L.J. Melody & Co.
93 275 per unit 8.685 0.060 0.065 L.J. Melody & Co.
94 0.15 per sq. ft. 9.435 0.000 0.005 GE Capital Asset Management
95 250 per unit 8.535 0.000 0.005 GE Capital Asset Management
96 250 per unit 8.485 0.000 0.005 GE Capital Asset Management
97 250 per unit 8.505 0.000 0.005 GE Capital Asset Management
98 250 per unit 8.645 0.000 0.005 GE Capital Asset Management
99 4% of gross rev. 9.475 0.000 0.005 GE Capital Asset Management
100 250 per unit 8.715 0.000 0.005 GE Capital Asset Management
101 0.15 per sq. ft. 8.845 0.000 0.005 GE Capital Asset Management
102 4% of gross rev. 9.275 0.000 0.005 GE Capital Asset Management
103 250 per unit 9.115 0.000 0.005 GE Capital Asset Management
104 0.15 per sq. ft. 9.125 0.000 0.005 GE Capital Asset Management
105 250 per unit 8.465 0.000 0.005 GE Capital Asset Management
106 4% of gross rev. 9.465 0.000 0.005 GE Capital Asset Management
107 4% of gross rev. 9.465 0.000 0.005 GE Capital Asset Management
108 4% of gross rev. 9.125 0.000 0.005 GE Capital Asset Management
109 4% of gross rev. 9.685 0.000 0.005 GE Capital Asset Management
110 250 per unit 8.825 0.000 0.005 GE Capital Asset Management
111 250 per unit 8.375 0.000 0.005 GE Capital Asset Management
112 250 per unit 8.375 0.000 0.005 GE Capital Asset Management
113 251 per unit 8.375 0.000 0.005 GE Capital Asset Management
114 250 per unit 8.585 0.000 0.005 GE Capital Asset Management
115 225 per unit 8.795 0.000 0.005 GE Capital Asset Management
116 250 per unit 8.745 0.000 0.005 GE Capital Asset Management
117 250 per unit 8.365 0.000 0.005 GE Capital Asset Management
118 250 per unit 8.505 0.000 0.005 GE Capital Asset Management
119 250 per unit 8.615 0.000 0.005 GE Capital Asset Management
120 4% of gross rev. 9.305 0.000 0.005 GE Capital Asset Management
121 4% of gross rev. 9.305 0.000 0.005 GE Capital Asset Management
122 250 per unit 8.215 0.060 0.065 L.J. Melody & Co.
123 250 per unit 8.215 0.060 0.065 L.J. Melody & Co.
124 4% of gross rev. 9.565 0.000 0.005 GE Capital Asset Management
125 300 per unit 8.655 0.000 0.005 GE Capital Asset Management
126 0.15 per sq. ft. 8.915 0.000 0.005 GE Capital Asset Management
127 4% of gross rev. 9.455 0.000 0.005 GE Capital Asset Management
128 4% of gross rev. 9.555 0.000 0.005 GE Capital Asset Management
129 0.15 per sq. ft. 8.805 0.000 0.005 GE Capital Asset Management
130 0.15 per sq. ft. 8.585 0.000 0.005 GE Capital Asset Management
131 0.15 per sq. ft. 9.565 0.000 0.005 GE Capital Asset Management
132 0.15 per sq. ft. 9.565 0.000 0.005 GE Capital Asset Management
133 0.15 per sq. ft. 8.565 0.000 0.005 GE Capital Asset Management
</TABLE>
-30-
<PAGE>
EXHIBIT B
MORTGAGE FILE SCHEDULE
None.
-31-
<PAGE>
<TABLE>
EXHIBIT C
MLMI 1997-C1
MERRILL LYNCH
LIST OF MORTGAGE LOANS WHICH
PROVIDE FOR HYPERAMORTIZATION
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
- ------- ------------- ------------- ----------- ------------
<S> <C> <C> <C>
85 Rowland Heights Shopping Ctr Anchored Retail $12,800,000 $12,792,920
</TABLE>
-32-
<PAGE>
EXHIBIT D
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xx)
None.
-33-
<PAGE>
EXHIBIT E
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxii)
None.
-34-
<PAGE>
EXHIBIT F
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxvii)
None.
-35-
<PAGE>
EXHIBIT G
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxviii)
None.
-36-
<PAGE>
EXHIBIT H
LIST OF MORTGAGED PROPERTIES WHICH CARRY
SIX MONTHS OF BUSINESS INTERRUPTION
OR RENT INSURANCE
None.
-37-
<PAGE>
EXHIBIT I
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxix)
None.
-38-
<PAGE>
<TABLE>
EXHIBIT J-1
MLMI-C1
MERRILL LYNCH
MORTGAGED PROPERTIES SUBJECT TO
SECONDARY LIENS
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
- ------ ------------- ------------- ------- -----------
<S> <C> <C> <C> <C>
12 Rush Creek Apartments Multifamily $4,200,000 $4,187,765
21 Guild Building Office $ 850,000 $ 846,082
25 Oregon Building Office $1,000,000 $ 998,025
30 Callens Corner Phase II Anchored Retail $4,087,500 $4,081,392
56 Pirani Best Western - Airport Executel Hospitality $4,075,000 $4,039,703
57 Best Western - Federal Way Executel Hospitality $4,825,000 $4,783,207
84 Woodley Downs Apartments Multifamily $1,450,000 $1,448,689
92 St. Augustine Beach Holiday Inn Hospitality $4,580,000 $4,536,490
101 Elkins Park Square Unanchored Retail $3,600,000 $3,600,000
</TABLE>
-39-
<PAGE>
<TABLE>
EXHIBIT J-2
MLMI 1997-C1
MERRILL LYNCH
MORTGAGED PROPERTIES WITH POTENTIAL
FUTURE LIENS
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
- ------ ------------- ------------- ------- ------------
<S> <C> <C> <C> <C>
104 Thunderbird Business Park Industrial $3,845,000 $3,841,644
7 Sunrise Commons Apartments Multifamily $5,624,000 $5,610,170
8 IRM-Meadow Lakes Apartments Multifamily $5,516,000 $5,502,436
9 Diablo View Apartments Multifamily $3,098,000 $3,090,382
10 IRM-Glenbrook Apartments Multifamily $6,280,000 $6,264,557
14 Salvio Pacheco Square Office/Retail $7,800,000 $7,770,812
27 Walnut Woods Apartments Multifamily $3,580,000 $3,573,298
28 Creekside Gardens Apartments Multifamily $7,600,000 $7,585,773
31 Driftwood Apartments Multifamily $3,650,000 $3,645,376
33 Country Glen Apartments Multifamily $2,700,000 $2,696,608
35 Foxworth Apartments Multifamily $2,130,000 $2,127,285
122 Parkwood Apartments Multifamily $3,955,000 $3,955,000
123 Peachwood Apartments Multifamily $2,250,000 $2,250,000
-40-
</TABLE>
<PAGE>
EXHIBIT K
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxxvii)
None.
-41-
<PAGE>
<TABLE>
EXHIBIT L
MLMI 1997-C1
MERRILL LYNCH
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxxviii)
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
- ------ ------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
85 Rowland Heights Shopping Ctr Anchored Retail $12,800,000 $12,792,920
</TABLE>
-42-
<PAGE>
<TABLE>
EXHIBIT M
MLMI 1997-C1
MERRILL LYNCH
LIST OF PRINCIPAL BORROWERS
WITH MULTIPLE MORTGAGE LOANS
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
- ------ ------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
1 INT - The Crescent City Apartments Multifamily $ 4,700,000 $ 4,684,339
2 INT - The Park Apartments Multifamily $ 4,080,000 $ 4,058,609
3 PP-Days Inn-Cody Hospitality $ 1,600,000 $ 1,593,544
4 Days Inn-Norfolk Hospitality $ 1,610,000 $ 1,603,503
6 Ramada Limited - Austin Hospitality $ 1,400,000 $ 1,389,664
108 Holiday Inn Express-Plano Hospitality $ 2,780,000 $ 2,759,216
7 Sunrise Commons Apartments Multifamily $ 5,624,000 $ 5,610,170
8 IRM-Meadow Lakes Apartments Multifamily $ 5,516,000 $ 5,502,436
9 Diablo View Apartments Multifamily $ 3,098,000 $ 3,090,382
10 IRM-Glenbrook Apartments Multifamily $ 6,280,000 $ 6,264,557
14 Salvio Pacheco Square Office/Retail $ 7,800,000 $ 7,770,812
27 Walnut Woods Apartments Multifamily $ 3,580,000 $ 3,573,298
28 Creekside Gardens Apartments Multifamily $ 7,600,000 $ 7,585,773
31 Driftwood Apartments Multifamily $ 3,650,000 $ 3,645,376
33 Country Glen Apartments Multifamily $ 2,700,000 $ 2,696,608
35 Foxworth Apartments Multifamily $ 2,130,000 $ 2,127,285
122 Parkwood Apartments Multifamily $ 3,955,000 $ 3,955,000
123 Peachwood Apartments Multifamily $ 2,250,000 $ 2,250,000
20 Carondelet Building Office $ 3,550,000 $ 3,533,635
21 Guild Building Office $ 850,000 $ 846,082
22 Lease-All Orangethorpe Industrial $ 2,850,000 $ 2,835,715
23 Lease-All Anaheim Industrial $ 5,509,000 $ 5,482,702
43 Shilo Inn-Bend Hospitality $ 6,650,000 $ 6,580,646
44 Shilo Inn-Coeur d'Alene Hospitality $ 5,740,000 $ 5,680,136
45 Shilo Inn-Nampa Hospitality $ 4,480,000 $ 4,433,277
47 Shilo Inn-Tillamook Hospitality $ 5,040,000 $ 4,987,437
48 Shilo Inn-Salt Lake City Hospitality $11,200,000 $11,083,192
49 Shilo Inn-Elko Hospitality $ 3,440,000 $ 3,404,123
56 Pirani Best Western - Airport Executel Hospitality $ 4,075,000 $ 4,039,703
57 Best Western - Federal Way Executel Hospitality $ 4,825,000 $ 4,783,207
62 Club Secane Apartments Multifamily $ 1,400,000 $ 1,391,566
125 Riverview Manor Apartments Multifamily $ 2,600,000 $ 2,600,000
65 Meridian Executive Center Office $ 4,833,000 $ 4,806,120
114 Whispering Oaks Apartments Multifamily $ 1,560,000 $ 1,552,446
79 Telstar Apartments Multifamily $ 988,000 $ 987,128
80 Mill Run Apartments Multifamily $ 1,230,000 $ 1,228,914
95 Parkside Aparments Multifamily $ 1,750,000 $ 1,743,190
96 Ridgeway Village Apartments Multifamily $ 3,500,000 $ 3,491,411
106 Ball Park Inn - Arlington Hospitality $ 2,250,000 $ 2,233,884
107 Best Western Inn Hospitality $ 2,600,000 $ 2,581,378
111 BDR - Francis Court III - Multifamily Multifamily $ 1,350,000 $ 1,344,882
112 BDR - Francis Court IV - Multifamily Multifamily $ 850,000 $ 846,778
113 BDR - Francis Court V - Multifamily Multifamily $ 1,500,000 $ 1,494,313
115 BDR - Sierra Point Apartments Multifamily $ 2,020,000 $ 2,015,348
120 Best Western - Park Suites Hospitality $ 2,750,000 $ 2,750,000
121 Comfort Inn - Plano Hospitality $ 1,750,000 $ 1,750,000
127 Best Western-Courtyard Inn Hospitality $ 1,750,000 $ 1,750,000
128 Super 8 - Whitewater, WI Hospitality $ 1,700,000 $ 1,700,000
131 AAAAA Rent-A-Space - Foster City Self Storage $ 5,690,000 $ 5,690,000
132 AAAAA Rent-A-Space - Colma Self Storage $10,550,000 $10,550,000
<CAPTION>
Control
Number Borrower Entity Name Principal Name
- ------ -------------------- --------------
<S> <C> <C>
1 Intercapital Hobby Place I, LP Edward I. Biskind
2 Intercapital Park Park I, LP Edward I. Biskind
3 PBS Enterprises, Inc. Piyush Patel
4 Yogi of Norfolk, Inc. Piyush Patel
6 Artex Hospitality, Inc. Bharatkumar V. Patel
108 Las Colinas Hospitality, Inc. Bharatkumar V. Patel
7 Sunrise Boulevard Associates John O. Van Hofwegen
8 Meadow Lakes Investors John O. Van Hofwegen
9 Diablo View Investors John O. Van Hofwegen
10 Glenbrook Associates John O. Van Hofwegen
14 Salvio Pacheco Square Investors John O. Van Hofwegen
27 Walnut Woods Investors John O. Van Hofwegen
28 Creekside Gardens Investors John O. Van Hofwegen
31 Grantline Gardens Group John O. Van Hofwegen
33 Country Glen Investors John O. Van Hofwegen
35 Foxworth Investors John O. Van Hofwegen
122 Parkwood Group, L.P. John O. Van Hofwegen
123 Peachwood Investors, L.P. John O. Van Hofwegen
20 Clayton Carondelet Buildings, LLC Arthur Loomstein
21 Guild Building, L.L.C. Arthur Loomstein
22 Lease-All Orangethorpe Robert Leaverton
23 Lease-All Anaheim Robert Leaverton
43 Shilo Inn, Bend, LLC Mark S. Hemstreet
44 Shilo Inn, Coeur d'Alene, LLC Mark S. Hemstreet
45 Shilo Inn, Nampa Suites, LLC Mark S. Hemstreet
47 Shilo Inn, Tillamook, LLC Mark S. Hemstreet
48 Shilo Inn, Salt Lake City, LLC Mark S. Hemstreet
49 Shilo Inn, Elko, LLC Mark S. Hemstreet
56 Piramco Sea-Tac, Inc. Same excl Madatali Pirani
57 Piramco Federal Way, Inc. Same excl Madatali Pirani
62 Club Secane 87 Associates Norman Feinstein
125 N.J. 1984 Associates-Highland Park, L.L.C. Norman Feinstein
65 Waterside Center Corp d/b/a Merician Executive Center Mahendra D. Sharma
114 TTSF, L.P. #2 Mahendra D. Sharma
79 Telstar Associates Curtis K. Harshaw
80 Chantelle Associates Curtis K. Harshaw
95 Parkside Mesa, L.L.C Terrance K. and Elizabeth L. Barry
96 Ridgeway Village Apartments, LLC Terrance K. and Elizabeth L. Barry
106 Arlington Hosts Corporation Chandrakant Patel
107 Garland Hospitality, Inc. Chandrakant Patel
111 1621 Rialto, LLC Donald Braham
112 1680 Rialto, LLC Donald Braham
113 160 Linden, LLC Donald Braham
115 1439 Lilac L.L.C. Donald Braham
120 Park Suites Hotels, Inc. Prashant Bhakta
121 E. Plano Hospitality, Inc. d/b/a Comfort Inn Plano Prashant Bhakta
127 R & K Development Corp. Ramesh Shah
128 Whitewater Hotel Inc. Ramesh Shah
131 AAAAA-Rent-A-Space Foster City Ltd., LP KN Productions Inc.
132 AAAAA-Rent-A-Space Colma Ltd., LP KN Productions Inc.
</TABLE>
-43-
MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement, dated as of June 1, 1997 (the
"Agreement"), between Daiwa Finance Corp. (the "Seller") and Merrill Lynch
Mortgage Investors, Inc. (the "Purchaser").
The Seller intends to sell and the Purchaser intends to purchase,
without recourse except as specifically provided herein, certain multifamily and
commercial mortgage loans (the "Mortgage Loans") as provided herein. The
Purchaser intends to deposit them, together with the MLMC Mortgage Loans (as
defined below) and GECA Mortgage Loans (as defined below), into a trust fund
(the "Trust Fund"), the beneficial ownership of which will be evidenced by
multiple classes (each, a "Class") of mortgage pass-through certificates (the
"Certificates"). One or more "real estate mortgage investment conduit" ("REMIC")
elections will be made with respect to the Trust Fund. The Trust Fund will be
created and the Certificates will be issued pursuant to a Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June 1, 1997 (the
"Cut-off Date"), among the Purchaser as depositor, GE Capital Asset Management
Corporation as master servicer (in such capacity, the "Master Servicer"), GE
Capital Realty Group, Inc. as special servicer (in such capacity, the "Special
Servicer"), General Electric Capital Corporation, ABN AMRO Bank N.V. as fiscal
agent (in such capacity, the "Fiscal Agent") and LaSalle National Bank as
trustee (the "Trustee"). Concurrently with the purchase of Mortgage Loans
pursuant to this Agreement, the Purchaser will also purchase multifamily and
commercial mortgage loans pursuant to a Mortgage Loan Purchase Agreement, dated
as of June 1, 1997, between Merrill Lynch Mortgage Capital Inc. ("MLMC") and the
Purchaser (the "MLMC Agreement") and pursuant to a Mortgage Loan Purchase
Agreement, dated as of June 1, 1997, between GE Capital Access, Inc. ("GECA")
and the Purchaser (the "GECA Agreement"). Such mortgage loans (the "MLMC
Mortgage Loans" and the "GECA Mortgage Loans", respectively) will likewise be
deposited into the Trust Fund. Capitalized terms used but not defined herein
have the respective meanings set forth in the Pooling and Servicing Agreement.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
(a) The Seller agrees to sell, and the Purchaser agrees to purchase,
without recourse except as specifically provided herein, the Mortgage Loans
identified on the schedule (the "Mortgage Loan Schedule") annexed hereto as
Exhibit A. The Mortgage Loan Schedule may be amended to reflect the actual
<PAGE>
Mortgage Loans. (The Mortgage Loans identified on the Mortgage Loan Schedule
shall hereinafter be referred to as the "Daiwa Mortgage Loans.") The Daiwa
Mortgage Loans will have an aggregate principal balance of $181,313,093.17 (the
"Daiwa Balance") as of the close of business on the Cut-off Date, after giving
effect to any payments due before such date whether or not received. The Daiwa
Balance, the MLMC Balance (as defined in the MLMC Agreement) and the GECA
Balance (as defined in the GECA Agreement) together equal an aggregate principal
balance (the "Initial Pool Balance") of $840,787,856. The purchase and sale of
the Daiwa Mortgage Loans shall take place on June 26, 1997 or such other date as
shall be mutually acceptable to the parties hereto (the "Closing Date"). The
consideration for the Daiwa Mortgage Loans shall consist of a cash amount equal
to (A) 101.97% of the Daiwa Balance, plus (B) interest accrued on each Daiwa
Mortgage Loan at the related Mortgage Rate, for the period from and including
the Cut-off Date up to but not including the Closing Date, which cash amount
shall be paid to the Seller or its designee by wire transfer in immediately
available funds on the Closing Date.
The Purchaser will assign to the Trustee, all of its right, title
and interest in and to the Daiwa Mortgage Loans.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 hereof, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Purchaser, without
recourse, all the right, title and interest of the Seller in and to the Daiwa
Mortgage Loans identified on the Mortgage Loan Schedule as of such date. The
Mortgage Loan Schedule, as it may be amended, shall conform to the requirements
set forth in this Agreement and the Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive all
scheduled payments of principal and interest due after the Cut-off Date, and all
other recoveries of principal and interest collected after the Cut-off Date
(other than in respect of principal and interest on the Daiwa Mortgage Loans due
on or before the Cut-off Date). All scheduled payments of principal and interest
due on or before the Cut-off Date but collected after the Cut-off Date, and
recoveries of principal and interest collected on or before the Cut-off Date
(only in respect of principal and interest on the Daiwa Mortgage Loans due on or
before the Cut-off Date), shall belong to, and be promptly remitted to, the
Seller.
(c) The Seller hereby represents and warrants that it has, on behalf
of the Purchaser, delivered to the Trustee, the documents and instruments
specified below with respect to each Daiwa Mortgage Loan (each a "Mortgage
File"). All Mortgage Files so delivered will be held by the Trustee in escrow at
all times
-2-
<PAGE>
prior to the Closing Date. Each Mortgage File shall, except as otherwise
disclosed on Exhibit B hereto, contain the following documents:
(i) the original executed Mortgage Note, endorsed (including
interim endorsements and without recourse, representation or
warranty, express or implied) to the order of LaSalle National
Bank, as trustee for the registered holders of Merrill Lynch
Mortgage Investors, Inc., Mortgage Pass-Through Certificates,
Series 1997-C1;
(ii) an original or copy of the Mortgage and of any intervening
assignments thereof, in each case with evidence of recording
indicated thereon;
(iii) an original or copy of any related Assignment of Leases (with
recording information indicated thereon), if such item is a
document separate from the Mortgage;
(iv) an original executed assignment of the Mortgage, any related
Assignment of Leases (if such item is a document separate from
the Mortgage), and any other recorded document relating to the
Mortgage Loan otherwise included in the Mortgage File, in
favor of LaSalle National Bank, as trustee for the registered
holders of Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of LaSalle National Bank, as
trustee for the registered holders of Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series
1997-C1, in recordable form;
(vi) originals or copies of any written modification agreements in
those instances where the terms or provisions of the Mortgage
or Mortgage Note have been modified;
(vii) the original or a copy of the policy or certificate of
lender's title insurance issued in connection with the
origination of such Mortgage Loan, or, if such policy has not
been issued, an irrevocable, binding commitment to issue such
title insurance policy; and
-3-
<PAGE>
(viii) filed copies of any prior UCC Financing Statements in favor
of the originator of such Mortgage Loan or in favor of any
assignee prior to the Trustee (but only to the extent the
Seller had possession of such UCC Financing Statements prior
to the Closing Date) and, if there is an effective UCC
Financing Statement in favor of the Seller on record with the
applicable public office for UCC Financing Statements, an
original UCC-2 or UCC-3, as appropriate, in favor of LaSalle
National Bank, as trustee for the registered holders of
Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1997-C1.
(d) Within 30 days following the Closing Date, the Purchaser shall
submit or cause to be submitted for recordation or filing, as the case may be,
in the appropriate public office for real property records or Uniform Commercial
Code financing statements, as appropriate, each assignment of Mortgage and each
assignment of Assignment of Leases referred to in clause (iv) of subsection (c)
above and each UCC-2 and UCC-3 in favor of and delivered to the Trustee
constituting part of the Mortgage File. If any such document or instrument is
lost or returned unrecorded or unfiled, as the case may be, because of a defect
therein, then the Seller shall promptly prepare a substitute therefor or cure
such defect or cause such to be done, as the case may be, and the Seller shall
promptly deliver such substitute or corrected document or instrument to the
Purchaser or its designee.
(e) All documents necessary to the servicing of the Daiwa Mortgage
Loans and in the Seller's possession (the "Additional Mortgage Loan Documents")
that are not required to be delivered to the Trustee shall be delivered or
caused to be delivered by the Seller to the Master Servicer or at the direction
of the Master Servicer, to the appropriate sub-servicer.
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants with
the Purchaser, as of the date hereof, that:
(i) The Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of New York and
is duly authorized and qualified to transact any and all business
contemplated by this Agreement and possesses all requisite authority,
power, licenses, permits and franchises to execute, deliver and comply
with its obligations under the terms of this Agreement and to carry on its
business as currently conducted by it, except to the extent that the
failure to obtain the same would not,
-4-
<PAGE>
in the Seller's good faith judgment, materially and adversely affect the
condition (financial or other), operations of the Seller or its
properties, or the value of the Mortgage Loans.
(ii) This Agreement has been duly and validly authorized,
executed and delivered by the Seller and, assuming due authorization,
execution and delivery hereof by the Purchaser, constitutes a legal, valid
and binding obligation of the Seller, enforceable against the Seller in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights in general and by general
equity principles (regardless of whether such enforcement is considered in
a proceeding in equity or at law), or by public policy considerations
underlying the securities laws, to the extent that such public policy
considerations limit the enforceability of the provisions of this
Agreement which purport to provide indemnification from liabilities under
applicable securities laws.
(iii) The execution and delivery of this Agreement by the
Seller and the Seller's performance and compliance with the terms of this
Agreement will not (A) violate the Seller's certificate of incorporation
or By-Laws, (B) violate any law or regulation or any administrative decree
or order to which it is subject or (C) constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default)
under, or result in the breach of, any material contract, agreement or
other instrument to which the Seller is a party or which may be applicable
to the Seller or any of its assets.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or other governmental agency or body, which default might
have consequences that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the condition (financial or
other) or operations of the Seller or its properties or have consequences
that would materially and adversely affect its performance hereunder.
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any certificate of incorporation, bylaws or any
other corporate restriction or any judgment, order, writ, injunction,
decree, law or regulation that would, in the Seller's reasonable and good
faith judgment, materially and adversely affect the ability of the Seller
to perform its obligations under this Agreement or that requires the
consent of any third person to the execution of this Agreement or the
performance by the Seller of its obligations under this Agreement.
-5-
<PAGE>
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery and
performance by the Seller of or compliance by the Seller with this
Agreement or the consummation of the transactions contemplated by this
Agreement and no bulk sale law applies to such transactions.
(vii) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller that would, in the Seller's good
faith and reasonable judgment, prohibit its entering into this Agreement
or adversely affect the performance by the Seller of its obligations under
this Agreement.
(viii) Under generally accepted accounting principles ("GAAP")
and for federal income tax purposes, the Seller will report the transfer
of the Daiwa Mortgage Loans to the Purchaser as a sale of the Daiwa
Mortgage Loans to the Purchaser in exchange for consideration consisting
of a cash amount equal to (A) 101.97% of the Daiwa Balance, plus (B)
interest accrued on each Daiwa Mortgage Loan at the related Mortgage Rate,
for the period from and including the Cut-off Date up to but not including
the Closing Date. The consideration received by the Seller upon the sale
of the Daiwa Mortgage Loans to the Purchaser will constitute reasonably
equivalent value and fair consideration for the Daiwa Mortgage Loans. The
Seller will be solvent at all relevant times prior to, and will not be
rendered insolvent by, the sale of the Daiwa Mortgage Loans to the
Purchaser. The Seller is not selling the Daiwa Mortgage Loans to the
Purchaser with any intent to hinder, delay or defraud any of the creditors
of the Seller.
(ix) Immediately prior to the sale of the Daiwa Mortgage Loans
to the Purchaser as herein contemplated, the Seller will have good title
thereto and be the sole owner thereof, and such sale will transfer the
Daiwa Mortgage Loans to the Purchaser free and clear of any pledge, lien,
encumbrance or security interest.
(x) The Prospectus dated June 5, 1997, as of the date of the
Prospectus Supplement dated June 20, 1997 (the "Prospectus Supplement"),
or as of the Closing Date, does not include any untrue statement of a
material fact relating to the Daiwa Mortgage Loans or the Seller in the
Sections entitled "SUMMARY-Mortgage Loan Sellers", "SUMMARY-The Mortgage
Pool" and "DESCRIPTION OF THE MORTGAGE POOL" in the Prospectus Supplement,
or omitted or omits to state therein a material fact necessary in order to
make the statements in such Sections relating to the Daiwa Mortgage Loans
or the Seller, in light of the circumstances under which they were made,
not misleading, and the Memorandum (as defined in the Certificate Purchase
Agreement, dated as of June 26, 1997),
-6-
<PAGE>
as of the date thereof or as of the Closing Date, insofar as the
Memorandum incorporates such sections of the Prospectus Supplement, does
not include any untrue statement of a material fact relating to the Daiwa
Mortgage Loans or the Seller or omitted or omits to state therein a
material fact necessary in order to make the statements therein relating
to the Daiwa Mortgage Loans or the Seller, in the light of the
circumstances under which they were made, not misleading. As the sole
remedy for breach of this representation, the Seller shall indemnify the
Purchaser against any and all losses, claims, damages or liabilities to
which the Purchaser may become subject as a result of the breach of the
representations contained in this Section 3(a)(x) pursuant to Section 7
hereof.
(b) The Seller hereby represents and warrants for the benefit of the
Purchaser and the Trustee for the benefit of the Certificateholders, as of the
Closing Date, with respect to each Daiwa Mortgage Loan, that:
(i) The Seller has good and marketable title to, and is the
sole owner and holder of, the Mortgage Loan.
(ii) The Seller has full right and authority to sell, assign
and transfer the Mortgage Loan.
(iii) The information pertaining to the Mortgage Loan set
forth in the Mortgage Loan Schedule is true, correct and complete in all
material respects as of the Cut-off Date.
(iv) The related Mortgagor has represented to the Seller or
the Mortgagee, as applicable, that as of the date of origination of the
Mortgage Loan, such Mortgagor, lessee and/or operator was in possession of
all licenses, permits, and authorizations then required for use of the
Mortgaged Property which were valid and in full force and effect as of the
origination date.
(v) The origination, servicing and collection practices used
by the Seller and, to the best of Seller's knowledge, any prior holder of
the Mortgage Note have been in all respects legal, proper and prudent and
have met customary industry standards.
(vi) The Seller is transferring the Mortgage Loan to the
Purchaser free and clear of any liens, pledges, charges and security
interests and the related Mortgage and Mortgage Note do not prohibit such
transfer.
(vii) The proceeds of the Mortgage Loan have been fully
disbursed and there is no requirement for future advances thereunder.
-7-
<PAGE>
(viii) If such Mortgage Loan was originated by the Seller or
an affiliate thereof, the Mortgage Loan complied with all applicable
usury, truth-in-lending, real estate settlement, equal credit opportunity,
disclosure and any other material laws applicable to such origination as
of the origination date; and if such Mortgage Loan was not originated by
the Seller or an affiliate thereof, then, to the best of the Seller's
knowledge after having performed the type of due diligence customarily
performed by prudent institutional commercial and multifamily mortgage
lenders, the Mortgage Loan complied with all applicable usury,
truth-in-lending, real estate settlement, equal credit opportunity,
disclosure and any other material laws applicable to the origination of
such Mortgage Loan as of the origination date.
(ix) Each of the related Mortgage Note, related Mortgage and
other agreements executed in connection therewith is the legal, valid and
binding obligation of the maker thereof (subject to any non-recourse
provisions contained in any of the foregoing agreements and any applicable
state anti-deficiency legislation), enforceable in the applicable state in
accordance with its terms and contains customary and enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for the realization against the related Mortgaged Property or
properties of the benefits of the security, including realization by
judicial or, if applicable, non-judicial foreclosure, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally, and by general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law), and, to
the best of Seller's knowledge, there is no valid defense, counterclaim or
right of offset or rescission available to the related Mortgagor as of the
Closing Date with respect to such Mortgage Note, Mortgage or other
agreements.
(x) The Mortgage File contains an Assignment of Leases (or the
related Mortgage provides for such an assignment), which creates, in favor
of the holder of the Note, a valid first-priority assignment of or
security interest in the right to receive all payments due under the
related leases, and no other person owns any interest therein superior to
or of equal priority with the interest created under such assignment;
provided that the enforceability of such lien is subject to applicable
bankruptcy, insolvency, reorganization, moratorium, and other laws
affecting the enforcement of creditors' rights generally, and by the
application of the rules of equity.
(xi) Since the origination of the Mortgage Loan the terms of
the related Mortgage Note, Mortgage and
-8-
<PAGE>
Security Agreements have not been impaired, waived, modified, altered,
satisfied, canceled or subordinated by the Seller, the originator or the
servicer thereof in any respect, except, in each of the foregoing
instances, by written instruments that are a part of the related Mortgage
File, recorded in the applicable public recording office if necessary to
maintain the priority of the lien of the related Mortgage and Security
Agreements and delivered to the Purchaser.
(xii) The Mortgage Loan complies with the Seller's or the
Seller's affiliate's that originated the Mortgage Loan underwriting
policies in effect as of such Mortgage Loan's origination date or, in the
case of Mortgage Loans acquired by the Seller (other than from an
affiliate), as of the date of such acquisition, (as applicable), and,
except for the Mortgage Loans acquired by the Seller, is on a form
commonly used by the Seller as of such date.
(xiii) The related Mortgage Note is not secured by any
collateral that is not being transferred to the Purchaser and each
Mortgage Loan that is cross-collateralized is cross-collateralized only
with other Mortgage Loans sold pursuant to this Agreement.
(xiv) The assignment of the related Mortgage and assignment of
leases to the Trustee constitutes the legal, valid, binding and
enforceable assignment of such Mortgage in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights generally, and by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in
equity or at law).
(xv) The Mortgage Loan is not a participation interest in a
mortgage loan, but is a whole loan, and the Seller does not own any equity
interest in the Mortgagor.
(xvi) Except with respect to the Mortgage Loans listed on
Exhibit C attached hereto, which provide for hyperamortization, the
Mortgage Loan does not contain any terms providing for a contingent
interest, or negative amortization.
(xvii) The related Mortgage creates a first-mortgage lien on
the related Mortgaged Property. Such lien has priority over all other
liens and encumbrances (including mechanic's or materialmen's liens)
except for (A) the lien for current real estate taxes and assessments not
yet due and payable and (B) covenants, conditions and restrictions, rights
of way, easements and other non-lien matters that are of public record and
are referred to in the related lender's title insurance policy, none of
which,
-9-
<PAGE>
individually or in the aggregate, materially interferes with the security
intended to be provided by such Mortgage. A UCC financing statement has
been filed and/or recorded in all places necessary to perfect a valid
security interest in the personal property, granted under such Mortgage
for which perfection is accomplished by the filing of a UCC financing
statement; any security agreement, chattel mortgage or equivalent document
related to and delivered in connection with the Mortgage Loan establishes
and creates a valid and enforceable first lien and first priority security
interest on the property described therein, provided that enforceability
may be limited by bankruptcy or other laws affecting creditor's rights or
by the application of the rules of equity.
(xviii) The related Mortgage Note and Mortgage do not require
the Mortgagee thereof to release any portion of the related Mortgaged
Property from the lien of the Mortgage that would have a material and
adverse affect on the related Mortgage Loan except upon payment in full of
the Mortgage Loan.
(xix) As of the Cut-off Date, there are no delinquent taxes,
assessments or other governmental charges which would be a lien against
the related Mortgaged Property affecting the related Mortgaged Property or
an escrow of funds in an amount sufficient to cover such payments has been
established.
(xx) Except as set forth in Exhibit D attached hereto, all
escrows, reserves, deposits and other payments relating to the Mortgage
Loan are under the control of the Seller or servicer of such Mortgage Loan
and all amounts required as of the date hereof under the Mortgage Loan
Documents to be deposited by the related Mortgagor have been deposited and
to the best of Seller's knowledge, to the extent such amounts have been
applied, they have been applied as intended. All such escrows, reserves,
deposits and other payments have been conveyed by the Seller to the
Trustee.
(xxi) (A) Except for certain delinquent payments, none of
which were thirty (30) or more days past the date when first due, since
the later of one year prior to the Closing Date or, if applicable, the
date of acquisition by the Mortgage Loan Seller of such Mortgage Loan,
through the Cut-Off Date, there was no material default, breach, violation
or event of acceleration existing under the related Mortgage or the
related Mortgage Note, and to the best knowledge of Seller, after due
inquiry, no event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a material
default, breach, violation or event of acceleration; and (B) the Seller
has not waived any material
-10-
<PAGE>
default, breach, violation or event of acceleration of any of the
foregoing, and, pursuant to the terms of the related Mortgage or the
related Mortgage Note, no person or party other than the holder of such
Mortgage Note may declare any event of default or accelerate the related
indebtedness under either of such Mortgage or Mortgage Note.
(xxii) Except as set forth in Exhibit E attached hereto, the
related Mortgage provides that the Mortgagor is required to provide to the
Mortgagee at least annually an operating statement, rent roll (if
applicable and if requested by the Mortgagee) and balance sheet, and if
requested in accordance with the terms of the Mortgage Loan, rent rolls,
with respect to the Mortgaged Property certified by a duly authorized
officer of the Mortgagor as true and correct as of the date thereof.
(xxiii) There is no proceeding known to the Seller to be
pending, after due inquiry, or threatened in writing for the total or
partial condemnation of a material part of the related Mortgaged Property,
and the Mortgaged Property is free and clear of any damage not covered by
insurance that would materially and adversely affect its value as security
for the Mortgage Loan; to the Seller's actual knowledge, there are no
pending actions, suits or proceedings by or before any court or
governmental authority against or affecting the related Mortgagor or the
related Mortgaged Property that, if determined adversely to such Mortgagor
or Mortgaged Property, would materially and adversely affect the value of
the Mortgaged Property or the ability of the Mortgagor to pay principal,
interest or any other amounts due under such Mortgage Loan.
(xxiv) Based on the type of due diligence customarily
performed by prudent institutional commercial and multifamily mortgage
lenders, each improvement located on or forming part of the related
Mortgaged Property complies with applicable laws and zoning ordinances, or
constitutes a legal non-conforming use or structure or, if such an
improvement does not so comply, such non-compliance does not materially
and adversely affect the value or operation of the Mortgaged Property.
(xxv) None of the improvements included for the purpose of
determining the appraised value of the related Mortgaged Property at the
time of the origination of the Mortgage Loan lies outside of the
boundaries and building restriction lines of the related Mortgaged
Property, except for certain immaterial encroachments therefrom, and no
improvements on adjoining properties materially encroach upon the related
Mortgaged Property.
(xxvi) The related Mortgaged Property is covered by an ALTA
lender's title insurance policy or its
-11-
<PAGE>
equivalent, insuring for the benefit of the original holder of the related
Note, its successors and assigns, that the related Mortgage is a valid
first mortgage lien on such Mortgaged Property in the original principal
amount of the related Note, subject only to the exceptions stated therein,
which do not and will not materially and adversely interfere with (1) the
ability of the related Mortgagor timely to pay in full the principal and
interest on the related Mortgage Note, or (2) the use of such Mortgaged
Property for the use currently being made thereof, or (3) the value of the
Mortgaged Property, and such policy is freely assignable to the trustee
without the consent of or any notification to the insurer; and such title
insurance policy is in full force and effect, no claims have been made
thereunder and to the best knowledge of the Seller, no holder of the
related Mortgage has done anything that would materially impair the
coverage under such policy.
(xxvii) The related Mortgaged Property is insured by a fire
and extended perils insurance policy that provides coverage in an amount
not less than the lesser of (a) the outstanding principal balance of the
Mortgage Loan and (b) the full replacement cost and, in any event, such
insurance policy is in an amount necessary to avoid the operation of any
co-insurance provisions with respect to the Mortgaged Property; each
related Mortgage obligates the related Mortgagor to maintain or cause to
be maintained all such insurance and at such Mortgagor's failure to do so,
does not prohibit the Mortgagee from maintaining such insurance, and such
insurance requires, or the related Mortgage requires the Mortgagor to
cause the related insurer to provide, prior notice to the Mortgagee at
termination or cancellation, and no such notice has been received; any
insurance proceeds in respect of a casualty loss or taking, will be
applied either to the repair or restoration of all or part of the related
Mortgaged Property or the payment of the outstanding principal balance of
the related Mortgage Loan, except for certain amounts not greater than
amounts which would be considered prudent by an institutional commercial
mortgage lender with respect to a similar mortgage loan and which are set
forth in the related Mortgage. Except as set forth on Exhibit F attached
hereto, the Mortgagee is named as a beneficiary under such insurance
policy.
(xxviii) Except as set forth on Exhibit G attached hereto, the
related Mortgaged Property is insured by business interruption or rent
insurance, in an amount at least equal to 12 months (or, in the case of
the Mortgage Loans listed in Exhibit H attached hereto, 6 months) of
operations of such Mortgaged Property and comprehensive general liability
insurance in an amount not less than $1 million per occurrence.
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(xxix) Except as set forth on Exhibit I attached hereto, no
improvements on a related Mortgaged Property are located in a "flood
hazard area" as defined by the Federal Insurance Administration or, if so
located, are covered by flood hazard insurance.
(xxx) The Mortgage Loan represents a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code. The Seller
represents and warrants that, either as of the date of origination or the
Closing Date, the fair market value of the property securing the Mortgage
Loan was not less than 80% of the "adjusted issue price" (within the
meaning of the REMIC Provisions) of such Mortgage Loan.
(xxxi) Prepayment Premiums and Yield Maintenance Charges
payable with respect to the Mortgage Loan, if any, constitute "customary
prepayment penalties" within the meaning of Treasury regulation Section
1.860G-1(b)(2).
(xxxii) A Phase I Environmental Site Assessment was performed
with respect to the related Mortgaged Property. Such Phase I Environmental
Site Assessment was performed within eight (8) months (or 15 months with
respect to one of the Mortgaged Properties) prior to their respective
dates of origination. A report of such Phase I Environmental Site
Assessment has been delivered to the Purchaser, and the Seller (or its
affiliate that originated the Mortgage Loan), having made no independent
inquiry other than reviewing such report, has no knowledge of any material
and adverse environmental condition or circumstance affecting the related
Mortgaged Property that was not disclosed in such report. To the extent
any such condition or circumstance was disclosed, there has been escrowed
an amount of money considered sufficient by the Seller, based upon the
related environmental reports, to cure and remedy such condition or
circumstance as recommended in the Phase I or, where applicable, Phase II
Environmental Site Assessment or such condition has been cured and
remedied. The Seller has received no notice of any other such condition or
circumstance.
(xxxiii) The Mortgage Loan contains a representation made by
the Mortgagor in substance that it has not and will not use, cause or
permit to exist on the related Mortgaged Property any hazardous materials
in any manner that violates federal, state or local laws, ordinances,
regulations or orders. The Mortgage Loan requires that the Mortgagor will
defend and hold the holder of the Mortgage and its successors and/or
assigns harmless from and against any and all losses, liabilities,
damages, injuries, penalties, fines, expenses, and claims of any kind
whatsoever (including attorney's fees and costs) paid, incurred, or
suffered by, or asserted against, any such party resulting from a breach
of any representation,
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warranty or covenant relating to environmental matters given by the
Mortgagor under the related Mortgage except for those resulting from gross
negligence or willful misconduct by the holder of the Mortgage or those
which are initially placed on, in or under the Mortgaged Property after
foreclosure or other taking of title to the Mortgaged Property by the
holder of the Mortgage. Subject to the last sentence of this clause
(xxxiii), to the best of the Seller's knowledge, having made no
independent inquiry other than reviewing Phase I and Phase II (where
applicable) Environmental Site Assessments, (i) the Mortgaged Property is
in material compliance with all applicable federal, state and local laws
pertaining to environmental regulation, contamination or clean-up, and
(ii) no notice of violation of such laws has been issued by any
governmental agency or authority, except as disclosed in environmental or
engineering assessments, including Phase I Environmental Site Assessments
or additional assessments (including Phase II Environmental Site
Assessments). To the extent any material violation was disclosed, there
has been escrowed an amount of money considered sufficient by the Seller,
based upon the related environmental reports, to cure and remedy such
condition or circumstance as recommended in the Phase I or Phase II
Environmental Site Assessment or such condition has been cured and
remedied.
(xxxiv) To the best knowledge of the Seller, after due inquiry
at origination, the Mortgagor is not a debtor in any state or federal
bankruptcy, insolvency, reorganization or similar proceeding.
(xxxv) No advance of funds has been made directly or
indirectly, by the Seller to the Mortgagor other than pursuant to the Note
and to Seller's (or its affiliate's that originated the Mortgage Loan)
knowledge, no funds have been received from any person other than such
Mortgagor for or on account of payments due on the Note.
(xxxvi) The related Mortgage prohibits, without the prior
written consent of the holder of such Mortgage, any sale or transfer of,
or pledge or lien on, the related Mortgaged Property, whether such lien
may be equal or subordinate to the lien of the related Mortgages, other
than (1) certain subordinate liens governed by standstill agreements which
each provide that the subordinate lender may not accelerate or otherwise
take any remedial action for so long as the Mortgage Loan is outstanding
(the Mortgaged Properties encumbered by such subordinate liens and the
principal amounts of and interest rates on the related debt are set forth
on Exhibit J-1 attached hereto) and (2) certain subordinate liens that may
be incurred in the future on the Mortgaged Properties set forth on Exhibit
J-2 attached hereto, provided that the future subordinate debt secured by
such liens (a) when combined with the applicable
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Mortgage Loan does not exceed an 80% loan-to-value and has at least a 1.20
debt service coverage and (b) is subject to a standstill agreement with
provisions similar to those represented above for existing subordinate
liens.
(xxxvii) If the related Mortgaged Property is a retail,
office, industrial or multifamily property, to the best of Seller's (or
its affiliate's affiliate that originated the Mortgage Loan) knowledge,
(i) the information contained in the related schedule of leases or most
recent rent roll, as the case may be, is true and correct in all material
respects, (ii) all leases set forth therein are in full force and effect,
and (iii) except as set forth in Exhibit K attached hereto, based on
Mortgagor's representations, tenant estoppel certificates or other
documents obtained by the Seller (or its affiliate that originated the
Mortgage Loan) from the related Mortgagor and/or tenants in connection
with the origination of the related Mortgage Loan, no material default by
the Mortgagor or the lessees has occurred under such leases, nor, to the
best of the Seller's knowledge, is there any existing condition which, but
for the passage of time or the giving of notice, or both, would result in
a material default under the terms of such lease.
(xxxviii) Except with respect to the Mortgage Loans identified
in Exhibit L attached hereto, if the principal balance of the related
Mortgage Loan is greater than $10 million, the related Mortgagor is a
person, other than an individual, which is formed or organized solely for
the purpose of owning and operating the Mortgaged Property (or has
covenanted to restrict its operations to owning or operating the Mortgaged
Property), does not engage in any business unrelated to such property and
its financing, does not have any assets other than those related to its
interest in the property or its financing, or any indebtedness other than
as permitted by the related Mortgage and the other Mortgage Loan
documents, has its own books and records and accounts separate and apart
from any other person, and holds itself out as being a legal entity,
separate and apart from any other person.
(xxxix) With respect to any Mortgage Loan that is secured in
whole or in part by the interest of a Mortgagor as a lessee under a Ground
Lease (for these purposes, the term "Ground Lease" includes any related
ground lessor estoppels and any other writings from ground lessor) but not
by the related fee interest:
(A) Such Ground Lease or a memorandum thereof has been duly recorded
and such Ground Lease permits the interest of the lessee thereunder to be
encumbered by the related Mortgage or, if consent of the lessor thereunder
is required, it has been obtained prior to the Closing Date.
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(B) The Mortgagor's interest in such Ground Lease is assignable to
the Trustee without the consent of the lessor thereunder (or, if any such
consent is required, it has been obtained prior to the Closing Date) and,
in the event that it is so assigned, is further assignable by the Trustee
and its successors without a need to obtain the consent of such lessor.
(C) Such Ground Lease may not be amended, modified, canceled or
terminated without the prior written consent of the Mortgagee and that any
such action without such consent is not binding on the Mortgagee, its
successors or assigns.
(D) Unless otherwise set forth in the Ground Lease, the Ground Lease
does not permit any increase in the amount of rent payable by the Ground
Lessee thereunder during the term of the Mortgage Loan.
(E) To the best of the Seller's knowledge, at the Closing Date, such
Ground Lease is in full force and effect and no default or condition which
with passage of time would become a default, has occurred under such
Ground Lease.
(F) Such Ground Lease requires the lessor thereunder to give notice
of any default by the lessee to the Mortgagee; and such Ground Lease, or
an estoppel or consent letter received by the Mortgagee from the lessor,
further provides that no notice of termination given under such Ground
Lease is effective against the mortgagee unless a copy has been delivered
to the mortgagee in the manner described in such Ground Lease or estoppel
or consent letter.
(G) The ground lessee's interest in the Ground Lease (I) is not
subject to any liens or encumbrances superior to, or of equal priority
with, the related Mortgage, other than the related ground lessor's related
fee interest and any exceptions stated in the related title insurance
policy or opinion of title, which exceptions do not and will not
materially and adversely interfere with (1) the ability of the related
Mortgagor timely to pay in full the principal and interest on the related
Mortgage Note, (2) the use of such Mortgaged Property for the use
currently being made thereof, or (3) the value of the Mortgaged Property
and (II) will not be interfered with in the event of any foreclosure or
other action taken by any mortgagee of the ground lessor's fee interest.
(H) A Mortgagee is permitted a reasonable opportunity (including,
where necessary, sufficient time to gain possession of the interest of the
lessee under such Ground Lease) to cure any curable default under such
Ground Lease
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before the lessor thereunder may terminate such Ground Lease.
(I) Such Ground Lease has an original term (including any extension
options set forth therein) that extends not less than 10 years beyond the
final maturity date of the related Mortgage Loan.
(J) Under the terms of such Ground Lease and the related Mortgage,
taken together, any related insurance proceeds or condemnation proceeds,
will be applied either to the repair or restoration of all or part of the
related Mortgaged Property, with the lessee's mortgagee or a trustee
appointed by it having the right to hold and disburse such proceeds as the
repair or restoration progresses, or to the payment of the outstanding
principal balance of the Mortgage Loan together with any accrued interest
thereon.
(K) Such Ground Lease does not impose any restrictions on subletting
which would be viewed as commercially unreasonable by a prudent commercial
mortgage lender.
(L) Upon request, the Ground Lessor is required to enter into a new
lease upon termination of the Ground Lease for any reason, on
substantially similar terms and conditions as the old lease including the
rejection of the lease in bankruptcy.
(M) To the best of Seller's (or its affiliates which originated the
Mortgage Loan) knowledge, the terms of the related Ground Lease have not
been waived, modified, altered, satisfied, impaired, cancelled,
subordinated or rescinded in any manner which materially interferes with
the security intended to be provided by such Mortgage.
(xl) As of the Cut-off Date, the aggregate principal amount of
any Mortgage Loan or group of Mortgage Loans made to one borrower or group
of affiliated borrowers does not exceed $31,302,624. Based on information
obtained from the related Mortgagor at the time of origination, a list of
borrowers or groups of affiliated borrowers with multiple Mortgage Loans
is attached hereto as Exhibit M.(xli) With respect to any Mortgage Loan
that is secured in whole or in part by a Mortgaged Property which is
operated as a residential health care facility (a "Facility"), if any:
(A) All governmental licenses, permits, regulatory agreements or
other approvals or agreements necessary or desirable for the use and
operation of each Facility as intended are held by the related Mortgagor
or the operator of the Facility, and are in full force and effect,
including, without limitation, a valid certificate of need
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("CON") or similar certificate, license, or approval issued by the
applicable department of health for the requisite number of beds, and
approved provider status in any approved provider payment program
(collectively, the "Licenses").
(B) The Licenses (a) may not be, and have not been, transferred to
any location other than the Facility; (b) have not been pledged as
collateral security for any other loan or indebtedness; and (c) are held
free from restrictions or known conflicts which would materially impair
the use or operation of the Facility as intended, and are not provisional,
probationary or restricted in any way.
(C) As of the Cut-off Date and to Seller's knowledge, without
inquiry, as of the Cut-off Date, the Facility has not received a "Level A"
(or equivalent) violation which has not been cured to the satisfaction of
the applicable governmental agency, and no statement of charges or
deficiencies has been made or penalty enforcement action has been
undertaken against the Facility, its operator or the Mortgagor or against
any officer, director or stockholder of such operator or the Mortgagor by
any governmental agency during the last three calendar years, and there
have been no violations over the past three years which have threatened
the Facility's, the operator's or the Mortgagor's certification for
participation in Medicare or Medicaid or the other third-party payors'
programs.
(xlii) If the related Mortgage is a deed of trust, a trustee,
duly qualified under applicable law to serve as such, is properly
designated and serving under such Mortgage.
(c) If the Seller receives notice of a Document Defect or a Breach
(the "Defect/Breach Notice"), which materially and adversely affects the
interests of the Certificateholders, then the Seller shall within 90 days after
its receipt of the Defect/Breach Notice (i) cure such Document Defect or Breach,
as the case may be, in all material respects, which shall include payment of
losses and any Additional Trust Fund Expenses associated therewith, or (ii)
repurchase the affected Daiwa Mortgage Loan (or the related Mortgaged Property)
from the Trustee at a price equal to the Purchase Price; provided, however, that
if such Document Defect or Breach is capable of being cured but not within such
90-day period and the Seller has commenced and is diligently proceeding with the
cure of such Document Defect or Breach within such 90-day period, the Seller
shall have an additional 90 days to complete such cure; and provided, further,
that with respect to such additional 90-day period the Seller shall have
delivered an Officer's Certificate to the Trustee setting forth the reason such
Document Defect or Breach is not capable of being cured within the initial
90-day period and what actions the Seller is pursuing in connection with the
cure thereof and stating that the Seller anticipates that
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such Document Defect or Breach will be cured within the additional 90-day
period. Notwithstanding the foregoing, the delivery of a commitment to issue a
policy of lender's title insurance as described in Section 3(b)(xxvi) in lieu of
the delivery of the actual policy of lender's title insurance shall not be
considered a Document Defect with respect to any Mortgage File if such actual
policy of insurance is delivered to the Trustee or a Custodian on its behalf not
later than the 90th day following the Closing Date. The Seller's obligation to
cure a Document Defect or Breach or to repurchase any affected Daiwa Mortgage
Loan as described above shall constitute the sole and exclusive remedy for a
Document Defect or Breach.
SECTION 4. Representations and Warranties of the Purchaser. In order to
induce the Seller to enter into this Agreement, the Purchaser hereby represents
and warrants for the benefit of the Seller as of the date hereof that:
(a) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. The Purchaser has
the full corporate power and authority and legal right to acquire the Daiwa
Mortgage Loans from the Seller and to transfer the Daiwa Mortgage Loans to the
Trustee.
(b) This Agreement has been duly and validly authorized, executed
and delivered by the Purchaser, all requisite action by the Purchaser's
directors and officers has been taken in connection therewith, and (assuming the
due authorization, execution and delivery hereof by the Seller) this Agreement
constitutes the valid, legal and binding agreement of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as such enforcement
may be limited by (A) laws relating to bankruptcy, insolvency, reorganization,
receivership or moratorium, (B) other laws relating to or affecting the rights
of creditors generally, or (C) general equity principles (regardless of whether
such enforcement is considered in a proceeding in equity or at law).
(c) Except as may be required under federal or state securities laws
(and will be obtained on a timely basis), no consent, approval, authorization or
order of, registration or filing with, or notice to, any governmental authority
or court, is required, under federal or state law, for the execution, delivery
and performance by the Purchaser of or compliance by the Purchaser with this
Agreement, or the consummation by the Purchaser of any transaction described in
this Agreement.
(d) None of the acquisition of the Daiwa Mortgage Loans by the
Purchaser, the transfer of the Daiwa Mortgage Loans to the Trustee, and the
execution, delivery or performance of this Agreement by the Purchaser, conflicts
or will conflict with, results or will result in a breach of, or constitutes or
will constitute a default under (A) any term or provision of the
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Purchaser's Articles of Incorporation or Bylaws, (B) any term or provision of
any material agreement, contract, instrument or indenture, to which the
Purchaser is a party or by which the Purchaser is bound, or (C) any law, rule,
regulation, order, judgment, writ, injunction or decree of any court or
governmental authority having jurisdiction over the Purchaser or its assets.
(e) Under GAAP and for federal income tax purposes, the Purchaser
will report the transfer of the Daiwa Mortgage Loans by the Seller to the
Purchaser as a sale of the Daiwa Mortgage Loans to the Purchaser in exchange for
consideration consisting of a cash amount equal to (A) 101.97% of the Daiwa
Balance, plus (B) interest accrued on each Daiwa Mortgage Loan at the related
Mortgage Rate, for the period from and including the Cut-off Date up to but not
including the Closing Date.
SECTION 5. Closing. The closing of the sale of the Mortgage Loans (the
"Closing") shall be held at the offices of Willkie Farr & Gallagher, One
Citicorp Center, 153 East 53rd Street, New York, New York 10022 at 10:00 A.M.,
New York time, on the Closing Date.
The Closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller set
forth in Sections 3(a), 3(b) and 3(c) of this Agreement and all of the
representations and warranties of the Purchaser set forth in Section 4 of this
Agreement shall be true and correct in all material respects as of the Closing
Date;
(b) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and acceptable to the
Purchaser, shall be duly executed and delivered by all signatories as required
pursuant to the respective terms thereof;
(c) The Seller shall have delivered and released to the Custodian
and the Master Servicer, respectively, all documents represented to have been or
required to be delivered to the Trustee and the Master Servicer pursuant to
Section 2 of this Agreement;
(d) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with and
the Seller shall have the ability to comply with all terms and conditions and
perform all duties and obligations required to be complied with or performed
after the Closing Date; and
(e) The Seller shall have paid all fees and expenses payable by it
to the Purchaser or otherwise pursuant to this Agreement.
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Both parties agree to use their best efforts to perform their
respective obligations hereunder in a manner that will enable the Purchaser to
purchase the Daiwa Mortgage Loans on the Closing Date.
SECTION 6. Closing Documents. The Closing Documents shall consist of the
following:
(a) This Agreement duly executed by the Purchaser and the Seller;
(b) A Certificate of the Seller, executed by a duly authorized
officer or other authorized signatory of the Seller and dated the Closing Date,
and upon which the Purchaser and the Underwriters may rely, to the effect that:
(1) the representations and warranties of the Seller in this Agreement are true
and correct in all material respects at and as of the Closing Date with the same
effect as if made on such date; and (ii) the Seller has, in all material
respects, complied with all the agreements and satisfied all the conditions on
its part that are required under this Agreement to be performed or satisfied at
or prior to the date hereof;
(c) An Officer's Certificate from an officer of the Seller, in his
or her individual capacity, dated the Closing Date, and upon which the Purchaser
may rely, to the effect that each individual who, as an officer or
representative of the Seller, signed this Agreement or any other document or
certificate delivered on or before the Closing Date in connection with the
transactions contemplated herein, was at the respective times of such signing
and delivery, and is as of the Closing Date, duly elected or appointed,
qualified and acting as such officer or representative, and the signatures of
such persons appearing on such documents and certificates are their genuine
signatures;
(d) [Reserved];
(e) The resolutions of the board of directors of the Seller and any
requisite shareholder consent authorizing the Seller's entering into the
transactions contemplated by this Agreement (or other evidence of such
authorization acceptable to the Purchaser), the certificate of incorporation and
by-laws of the Seller, and a certificate of good standing of the Seller issued
by the Secretary of State of the State of Delaware not earlier than sixty (60)
days prior to the Closing Date;
(f) A written opinion of counsel for the Seller in form and
substance acceptable to the Purchaser and its counsel, with any modifications
required by the rating agencies identified in the Prospectus Supplement (the
"Rating Agencies"), dated the Closing Date and addressed to the Purchaser, the
Underwriters and each of the Rating Agencies, together with such other written
opinions as may be required by the Rating Agencies; and
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(g) Such further certificates, opinions and documents as the
Purchaser may reasonably request.
SECTION 7. Indemnification.
(a) The Seller agrees to indemnify and hold harmless the Purchaser,
the Underwriters, their respective officers and directors, and each person, if
any, who controls the Purchaser or the Underwriters within the meaning of either
Section 15 of the Securities Act of 1933 (the "1933 Act") or Section 20 of the
Securities Exchange Act of 1934 (the "1934 Act"), against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the 1933 Act, the 1934 Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based in whole or in part upon any untrue statement or alleged untrue
statement of a material fact relating to the Daiwa Mortgage Loans or the Seller
contained in the Sections entitled "SUMMARY-Mortgage Loan Sellers", "SUMMARY-The
Mortgage Pool" and "DESCRIPTION OF THE MORTGAGE POOL" in the Prospectus
Supplement, and in the Private Placement Memorandum insofar as the Private
Placement Memorandum incorporates such sections of the Prospectus Supplement, or
arise out of or are based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances in which they were made,
not misleading, which untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon any information furnished to the
Purchaser by the Seller or approved by the Seller, or upon any document
delivered to the Purchaser by the Seller, or upon any of the representations,
warranties, covenants or agreements of the Seller as set forth in this Agreement
(collectively, the "Seller's Information"), it being acknowledged that the
statements set forth in the Prospectus Supplement under the caption
"SUMMARY-Mortgage Loan Sellers", SUMMARY-The Mortgage Pool" and "DESCRIPTION OF
THE MORTGAGE POOL" and statements in the Private Placement Memorandum insofar as
the Private Placement Memorandum incorporates such sections of the Prospectus
Supplement, in each case solely to the extent relating to or based (in whole or
in part) on information relating to the Daiwa Mortgage Loans or the Seller, are
to be the only statements made in reliance upon information furnished or
approved by the Seller, or upon documents delivered to the Purchaser by the
Seller, or upon any of the representations, warranties, covenants or agreements
of the Seller as set forth in this Agreement.
(b) Promptly after receipt by any person entitled to indemnification
under this Section 7 (an "indemnified party") of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against the Seller (the "indemnifying party") under this Section 7, notify
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the indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party will not relieve it from any liability that
it may have to any indemnified party otherwise than under this Section 7. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein, and to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel satisfactory to such indemnified party; provided, however, that if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party or parties shall have reasonably
concluded that there may be legal defenses available to it or them and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, unless (i) the indemnified party shall have
employed separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel, approved by the Purchaser, representing all the
indemnified parties under Section 7(a) who are parties to such action), (ii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action or (iii) the indemnifying party has
authorized the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall only be in respect of the counsel referred to in such
clause (i) or (iii).
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under Section 7(a) hereof or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
the indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified
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and indemnifying parties shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by such parties.
(d) The Purchaser and the Seller agree that it would not be just and
equitable if contribution pursuant to Section 7(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the considerations referred to in Section 7(c) above. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in this Section 7 shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim, except where the indemnified party is required to bear such
expenses pursuant to this Section 7, which expenses the indemnifying party shall
pay as and when incurred, at the request of the indemnified party, to the extent
that the indemnifying party will be ultimately obligated to pay such expenses.
If any expenses so paid by the indemnifying party are subsequently determined to
not be required to be borne by the indemnifying party hereunder, the party that
received such payment shall promptly refund the amount so paid to the party
which made such payment. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The indemnity and contribution agreements contained in this
Section 7 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by the Purchaser,
the Underwriters, any of their respective directors or officers, or any person
controlling the Purchaser or the Underwriters, and (iii) acceptance of and
payment for any of the Certificates.
(f) The Underwriters shall be third-party beneficiaries of the
provisions of this Section 7.
SECTION 8. Costs. The Seller shall pay (or shall reimburse the Purchaser
to the extent that the Purchaser has paid) the Seller's pro rata portion of the
aggregate of the following amounts (the Seller's pro rata portion to be
determined according to the percentage that the Daiwa Balance represents of the
Initial Pool Balance): (i) the costs and expenses of printing (or otherwise
reproducing) and delivering a preliminary and final Prospectus and Memorandum
relating to the Certificates; (ii) the initial fees, costs, and expenses of the
Trustee (including reasonable attorneys' fees); (iii) the filing fee charged by
the Securities and Exchange Commission for registration of the Certificates so
registered; (iv) the fees charged by the Rating Agencies to rate the
Certificates so rated; (v) the expense of
-24-
<PAGE>
recording any assignment of Mortgage or assignment of Assignment of Leases as
contemplated by Section 2 hereof; and (vi) the cost of obtaining a "comfort
letter" from a firm of certified public accountants selected by the Purchaser
with respect to numerical information in respect of the Daiwa Mortgage Loans and
the Seller included in the Prospectus and Memorandum. All other costs and
expenses in connection with the transactions contemplated hereunder shall be
borne by the party incurring such expense.
SECTION 9. Notices. All notices, copies, requests, consents, demands and
other communications required hereunder shall be in writing and telecopied or
delivered to the intended recipient at the "Address for Notices" specified
beneath its name on the signature pages hereof or, as to either party, at such
other address as shall be designated by such party in a notice hereunder to the
other party. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 10. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement, incorporated herein by reference or contained in the certificates of
officers of the Seller submitted pursuant hereto, shall remain operative and in
full force and effect and shall survive delivery of the Daiwa Mortgage Loans by
the Seller to the Purchaser (and by the Purchaser to the Trustee).
SECTION 11. Severability of Provisions. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
which is held to be void or unenforceable shall be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation, warranty or covenant of
this Agreement that is prohibited or unenforceable or is held to be void or
unenforceable in any particular jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof.
SECTION 12. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but which together shall
constitute one and the same agreement.
SECTION 13. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES,
OBLIGATIONS AND RESPONSIBILITIES OF THE PARTIES HERETO
-25-
<PAGE>
SHALL BE GOVERNED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF NEW
YORK. THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW
YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 14. Further Assurances. The Seller and the Purchaser agree to
execute and deliver such instruments and take such further actions as the other
party may, from time to time, reasonably request in order to effectuate the
purposes and to carry out the terms of this Agreement.
SECTION 15. Successors and Assigns. The rights and obligations of the
Seller under this Agreement shall not be assigned by the Seller without the
prior written consent of the Purchaser, except that any person into which the
Seller may be merged or consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Seller is a party, or any
person succeeding to all or substantially all of the business of the Seller,
shall be the successor to the Seller hereunder. The Purchaser has the right to
assign its interest under this Agreement, in whole or in part, as may be
required to effect the purposes of the Pooling and Servicing Agreement, and the
assignee shall, to the extent of such assignment, succeed to the rights and
obligations hereunder of the Purchaser. Subject to the foregoing, this Agreement
shall bind and inure to the benefit of and be enforceable by the Seller and the
Purchaser, and their permitted successors and assigns, and the officers,
directors and controlling persons referred to in Section 7.
SECTION 16. Amendments. No term or provision of this Agreement may be
waived or modified unless such waiver or modification is in writing and signed
by a duly authorized officer of the party against whom such waiver or
modification is sought to be enforced.
-26-
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective duly authorized officers as of the
date first above written.
SELLER
DAIWA FINANCE CORP.
By: /s/ Frank J. Keane
------------------------------------
Name: Frank J. Keane
Title: Vice President
Address for Notices:
Financial Square, 32 Old Slip
New York, New York 10005-3538
Attention: Samuel Kirschner
Telecopier No.: (212) 612-6976
Telephone No.: (212) 612-6908
and
Attention: Frank J. Keane
Telecopier No.: (212) 612-6976
Telephone No.: (212) 612-6906
PURCHASER
MERRILL LYNCH MORTGAGE
INVESTORS, INC.
By: /s/ Bruce L. Ackerman
------------------------------------
Name: Bruce L. Ackerman
Title: Vice President
Address for Notices:
World Financial Center
New York, New York 10281
Attention:
Telecopier No.: (212) 449-7684
Telephone No.: (212) 449-5849
-27-
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT A
MLMI 1997-C1
DAIWA
MORTGAGE LOAN SCHEDULE
Control
Number Property_Name Address City
------ ------------- ------- ----
<S> <C> <C> <C>
134 River Oaks Village Shopping Cr 3700 Lorna Road Hoover
135 Wyncove Apartments 3251 Commerce Drive East Point
136 Wyncreek Apartments 588 Little Street Marietta
137 Brookside Apartments 3661 North Decatur Road Decatur
138 Highland Point Shopping Center 1900-1952 FM Road 407 Highland Village
139 Holiday Inn - St. Augustine 1300 Ponce de Leon Boulevard St. Augustine
140 Rustic Village Apartments 9303 Town Park Drive Houston
141 Northrich Village Shopping Ctr 510-520 Arapaho Road Richardson
142 2-8 Washington Avenue 2-8 Washington Avenue Chelsea
143 Riverview Apartments 78 Pheasant Road Peterborough
144 Del Norte Apartments 6134 4th Street, NW Village of Los Ranchos
145 Budgetel Inn - Atlanta Airport 2480 Old National Parkway College Park
146 Holiday Inn Express-Oakhurst 40662 Highway 41 Oakhurst
147 Holiday Inn Express-Mariposa 5059 Highway 140 Mariposa
148 Holiday Inn Express-Fresno 6051 North Thesta Street Fresno
149 Flower Avenue Shopping Center 8701-8749 Flower Avenue Silver Spring
150 Riverwalk Plaza 20 MacCorkle Ave., Southwest South Charleston
151 Ashley Gables Apartments 2225 131st Avenue East Tampa
152 Plymouth Towne Apartments 107 Haggerty Road Plymouth
153 Brook Apartments 5328 Montgomery Boulevard N.E. Albuquerque
154 Woodridge Plaza Shopping Ctr 6969 Gulf Freeway Houston
155 El Royale Apartments 1414 N. Riverside Avenue Rialto
156 Terrytown Village Apartments 733 Carrollwood Village Drive Gretna
157 Santa Fe Square 5231 Blanco Road San Antonio
158 Lochhaven Apartments 2900 NW 56th Avenue Lauderhill
159 Valle Sereno Apartments 9133 Kernel Circle El Paso
160 Landmark Towers Apartments 601 NW 42nd Avenue Plantation
161 Spring Ridge Apartments 3604 Legendary Drive Dallas
162 Danubia Apartments 5301-5325 North 17th Street McAllen
163 Harker Heights Shopping Center 702-706 Edwards Drive Killeen
164 Capitol Plaza Shopping Center South Blvd. & Woodley Road Montgomery
165 9343 North Loop East 9343 North Loop East Houston
166 Belleview Plaza Shopping Ctr NEC of Aaron Aronov Blvd & Belleview Drive Fairfield
167 Enterprise Square Shopping Ctr Central Xpressway/Premier Dr Plano
168 Waverly Place Shopping Center SEC Kildaire Farm Rd &Tyron Rd Cary
169 Polo Grounds Shopping Center 890 South Military Trail West Palm Beach
170 Marshall Plaza 919 West College Street Marshall
171 The Woods of Mandarin 3200 Hartley Road Jacksonville
172 Kristopher Woods Apartments 762-792 Jolly Avenue South Clarkston
173 Lantern Ridge Apartments 1810 Roswell Road Marietta
174 The Thicket Apartments 5816 Covington Highway Decatur
175 Lakeside Villa Apartments 3600 Ashford Dunwoody Road Atlanta
176 Shoreham Apartments 2001 Dawson Road Albany
177 Tahoe North Apartments-Phase I 1000 Holcomb Bridge Road Roswell
178 Tahoe North Apartments-PhaseII 1000 Holcomb Bridge Road Roswell
179 Century American Insurance Blg 2828 Croasdaile Drive Durham
180 Apopka Square Center 823 Semoran Blvd. S.R.436/441 Apopka
181 Castro Commons Prof. Center 1172 and 1174 Castro Street Mountain View
182 Markham Building 2301 14th Street Gulfport
183 Morristown Plaza Shopping Ctr 30 Lafayette Ave Morristown
184 Atlantic Square Shopping Ctr. 2500 - 2780 E. Atlantic Blvd. Pompano Beach
</TABLE>
<TABLE>
<CAPTION>
Control Original Cut-off Date Monthly Gross Remaining Maturity
Number State Zip Code Balance Balance Payment Rate Term Amort Date
------ ----- -------- -------- ------------ ------- ----- ---- ----- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
134 AL 35216 $ 1,600,000 $ 1,402,153.88 $16,109.51 8.875 140 140 2/1/09
135 GA 30344 $ 1,350,000 $ 1,322,582.08 $12,602.10 10.350 58 274 4/1/02
136 GA 30060 $ 1,550,000 $ 1,519,333.10 $12,795.92 8.800 64 280 10/1/02
137 GA 30032 $ 1,750,000 $ 1,730,840.10 $15,554.38 8.830 113 233 11/1/06
138 TX 75067 $ 3,350,000 $ 3,329,755.36 $27,228.67 8.740 113 305 11/1/06
139 FL 32804 $ 2,236,000 $ 2,233,541.46 $21,135.35 9.700 119 239 5/1/07
140 TX 77036 $ 2,900,000 $ 2,880,433.32 $25,337.20 9.500 112 292 10/1/06
141 TX 75080 $ 4,100,000 $ 4,058,692.79 $36,178.46 9.625 108 288 6/1/06
142 MA 02150 $ 715,000 $ 708,991.15 $ 6,281.76 9.570 110 290 8/1/06
143 NH 03458 $ 1,315,000 $ 1,303,658.83 $10,954.50 8.910 51 291 9/1/01
144 NM 87107 $ 2,814,000 $ 2,799,269.53 $22,318.88 8.840 111 351 9/1/06
145 GA 30349 $ 2,200,000 $ 2,185,375.73 $20,489.82 10.320 171 291 9/1/11
146 CA 91301 $ 1,520,000 $ 1,501,372.72 $14,668.33 10.000 171 231 9/1/11
147 CA 95338 $ 1,700,000 $ 1,679,166.84 $16,405.37 10.000 171 231 9/1/11
148 CA 93710 $ 1,980,000 $ 1,955,735.49 $19,107.43 10.000 171 231 9/1/11
149 MD 20901 $ 2,450,000 $ 2,433,332.15 $21,320.48 9.450 112 292 10/1/06
150 WV 25315 $ 8,690,000 $ 8,629,348.28 $74,689.60 9.295 112 292 10/1/06
151 FL 33612 $ 7,400,000 $ 7,361,948.07 $56,010.46 8.330 76 352 10/1/03
152 MI 48170 $ 3,109,000 $ 3,089,015.28 $26,005.51 8.960 113 293 11/1/06
153 NM 87109 $ 3,785,500 $ 3,761,046.84 $31,586.52 8.930 113 293 11/1/06
154 TX 77087 $ 2,850,000 $ 2,819,977.91 $25,899.36 9.140 77 233 11/1/03
155 CA 92376 $ 2,500,000 $ 2,471,310.48 $20,793.73 9.375 63 339 9/1/02
156 LA 70056 $ 1,980,000 $ 1,956,168.34 $15,753.77 8.875 100 340 10/1/05
157 TX 78213 $ 1,800,000 $ 1,783,443.59 $15,883.23 9.625 49 289 7/1/01
158 FL 33313 $ 3,000,000 $ 2,908,488.79 $26,034.70 8.500 222 222 12/1/15
159 TX 79907 $ 1,925,000 $ 1,850,991.07 $19,668.03 9.125 166 166 4/1/11
160 FL 33317 $ 2,700,000 $ 2,660,360.22 $22,197.88 8.750 105 285 3/1/06
161 TX 74224 $ 1,625,000 $ 1,602,984.02 $13,916.20 9.250 285 285 3/1/21
162 TX 78504 $ 1,718,000 $ 1,708,816.22 $14,760.27 9.750 73 349 7/1/03
163 TX 76543 $ 2,300,000 $ 2,287,271.00 $19,159.96 8.910 114 294 12/1/06
164 AL 36116 $ 4,700,000 $ 4,672,725.28 $38,226.50 8.620 78 294 12/1/03
165 TX 77029 $ 2,575,000 $ 2,563,533.25 $21,785.91 9.100 115 295 1/1/07
166 AL 35064 $ 6,065,000 $ 6,043,116.31 $50,897.26 9.000 80 296 2/1/04
167 TX 75075 $ 6,180,000 $ 6,158,336.76 $52,668.77 9.190 116 296 2/1/07
168 NC 27511 $10,880,000 $10,853,609.73 $87,975.61 8.550 117 297 3/1/07
169 FL 33406 $ 5,200,000 $ 5,185,024.76 $42,222.81 8.600 117 297 3/1/07
170 MO 65340 $ 1,900,000 $ 1,897,301.51 $16,442.02 9.380 118 298 4/1/07
171 FL 32257 $ 5,485,000 $ 5,445,335.00 $43,033.05 8.720 48 348 6/1/01
172 GA 30021 $ 4,045,000 $ 4,020,626.08 $33,042.98 9.170 109 349 7/1/06
173 GA 30062 $ 3,650,000 $ 3,627,413.08 $29,473.84 9.040 109 349 7/1/06
174 GA 30035 $ 7,392,000 $ 7,346,256.87 $59,690.58 9.040 73 349 7/1/03
175 GA 30319 $ 6,620,000 $ 6,582,518.12 $53,218.39 8.990 74 350 8/1/03
176 GA 31707 $ 2,978,000 $ 2,959,571.57 $24,047.42 9.040 109 349 7/1/06
177 GA 30076 $ 5,845,000 $ 5,817,174.34 $45,815.76 8.710 76 352 10/1/03
178 GA 30076 $ 8,335,000 $ 8,295,320.51 $65,333.50 8.710 76 352 10/1/03
179 NC 27705 $ 4,500,000 $ 4,478,598.32 $36,843.72 8.700 55 295 1/1/02
180 FL 32703 $ 2,335,000 $ 2,322,992.78 $18,363.52 8.220 79 295 1/1/04
181 CA 94043 $ 5,900,000 $ 5,896,181.15 $49,391.43 8.970 119 299 5/1/07
182 MS 39501 $ 2,175,000 $ 2,173,807.80 $19,078.55 9.550 119 299 5/1/07
183 NJ 07960 $ 2,940,000 $ 2,938,245.31 $25,197.92 9.260 119 299 5/1/07
184 FL 33062 $ 4,100,000 $ 4,100,000.00 $34,154.72 8.910 120 300 6/1/07
</TABLE>
<TABLE>
<CAPTION>
Control Ground Underwriting Net Subservicing (1)Servicing
Number Lease Reserves Rate Fees Fees Subservicer
------ ------ ------------ ---- ------------ ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C>
134 No 0.1 Per Sq Ft 8.645 0.225 0.23 Collateral Mortgage, Ltd.
135 No 200 Per Unit 8.410 1.935 1.94 Collateral Mortgage, Ltd.
136 No 200 Per Unit 8.440 0.355 0.36 Collateral Mortgage, Ltd.
137 No 249.77 Per Unit 8.700 0.125 0.13 Collateral Mortgage, Ltd.
138 No 0.15 Per Sq Ft 8.610 0.125 0.13 Collateral Mortgage, Ltd.
139 No 464.8 Per Room 9.570 0.125 0.13 Continental Wingate Mortgage Group
140 No 254 Per Unit 9.370 0.125 0.13 Boatman's/NationsBank
141 No 0.15 Per Sq Ft 9.495 0.125 0.13 Continental Wingate Mortgage Group
142 No 322 Per Unit 9.440 0.125 0.13 Continental Wingate Mortgage Group
143 No 300 Per Unit 8.780 0.125 0.13 Continental Wingate Mortgage Group
144 No 250 Per Unit 8.710 0.125 0.13 Continental Wingate Mortgage Group
145 No 489.22 Per Room 10.190 0.125 0.13 Continental Wingate Mortgage Group
146 No 773 Per Room 9.870 0.125 0.13 Continental Wingate Mortgage Group
147 No 744 Per Room 9.870 0.125 0.13 Continental Wingate Mortgage Group
148 No 769 Per Room 9.870 0.125 0.13 Continental Wingate Mortgage Group
149 No 0.15 Per Sq Ft 9.320 0.125 0.13 Continental Wingate Mortgage Group
150 No 0.15 Per Sq Ft 9.165 0.125 0.13 Continental Wingate Mortgage Group
151 No 250 Per Unit 8.200 0.125 0.13 Continental Wingate Mortgage Group
152 No 300 per bed 8.830 0.125 0.13 Continental Wingate Mortgage Group
153 No 250 Per Unit 8.800 0.125 0.13 Continental Wingate Mortgage Group
154 No 0.2 Per Sq Ft 9.010 0.125 0.13 Continental Wingate Mortgage Group
155 No 371 Per Unit 9.120 0.250 0.255 Boatman's/NationsBank
156 No 150 Per Unit 8.620 0.250 0.255 Boatman's/NationsBank
157 No 220 Per Unit 9.370 0.250 0.255 Boatman's/NationsBank
158 No 280 Per Unit 8.245 0.250 0.255 Boatman's/NationsBank
159 No 145.28 Per Unit 8.870 0.250 0.255 Boatman's/NationsBank
160 No 226.63 Per Unit 8.495 0.250 0.255 Boatman's/NationsBank
161 No 275 Per Unit 8.995 0.250 0.255 Boatman's/NationsBank
162 No 266 Per Unit 9.495 0.250 0.255 Boatman's/NationsBank
163 No 0.15 Per Sq Ft 8.780 0.125 0.13 Continental Wingate Mortgage Group
164 No 0.15 Per Sq Ft 8.490 0.125 0.13 Continental Wingate Mortgage Group
165 No 0.15 Per Sq Ft 8.970 0.125 0.13 Continental Wingate Mortgage Group
166 No 0.19 Per Sq Ft 8.870 0.125 0.13 Continental Wingate Mortgage Group
167 No 0.15 Per Sq Ft 9.060 0.125 0.13 Continental Wingate Mortgage Group
168 No 0.15 Per Sq Ft 8.420 0.125 0.13 Continental Wingate Mortgage Group
169 No 0.16 Per Sq Ft 8.470 0.125 0.13 Continental Wingate Mortgage Group
170 No 0.2 Per Sq Ft 9.250 0.125 0.13 Continental Wingate Mortgage Group
171 No 250 Per Unit 8.590 0.125 0.13 Continental Wingate Mortgage Group
172 No 250 Per Unit 9.040 0.125 0.13 Continental Wingate Mortgage Group
173 No 250 Per Unit 8.910 0.125 0.13 Continental Wingate Mortgage Group
174 No 250 Per Unit 8.910 0.125 0.13 Continental Wingate Mortgage Group
175 No 269 Per Unit 8.860 0.125 0.13 Continental Wingate Mortgage Group
176 No 263 Per Unit 8.910 0.125 0.13 Continental Wingate Mortgage Group
177 No 254.22 Per Unit 8.580 0.125 0.13 Continental Wingate Mortgage Group
178 No 305 Per Unit 8.580 0.125 0.13 Continental Wingate Mortgage Group
179 No 0.15 Per Sq Ft 8.570 0.125 0.13 Continental Wingate Mortgage Group
180 No 0.15 Per Sq Ft 8.090 0.125 0.13 Continental Wingate Mortgage Group
181 Yes 0.15 Per Sq Ft 8.840 0.125 0.13 Continental Wingate Mortgage Group
182 No 0.37 Per Sq Ft 9.420 0.125 0.13 Continental Wingate Mortgage Group
183 No 0.18 Per Sq Ft 9.130 0.125 0.13 Continental Wingate Mortgage Group
184 No 0.15 Per Sq Ft 8.780 0.125 0.13 Continental Wingate Mortgage Group
</TABLE>
-28-
<PAGE>
EXHIBIT B
MORTGAGE FILE SCHEDULE
None.
-29-
<PAGE>
EXHIBIT C
LIST OF MORTGAGE LOANS WHICH
PROVIDE FOR HYPERAMORTIZATION
None.
-30-
<PAGE>
EXHIBIT D
MLMI 1997-C1
DAIWA
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xx)
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
------- ------------- ------------- -------- ------------
<S> <C> <C> <C> <C>
140 Rustic Village Apartments Multifamily $2,900,000 $2,880,433
157 Santa Fe Square Multifamily $1,800,000 $1,783,444
159 Valle Sereno Apartments Multifamily $1,925,000 $1,850,991
160 Landmark Towers Apartments Multifamily $2,700,000 $2,660,360
161 Spring Ridge Apartments Multifamily $1,625,000 $1,602,984
162 Danubia Apartments Multifamily $1,718,000 $1,708,816
</TABLE>
Replacement reserves in an amount not to exceed $174,994.89 have not been
collected/received for the above properties.
-31-
<PAGE>
EXHIBIT E
MLMI 1997-C1
DAIWA
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxii)
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
------- ------------- ------------- -------- ------------
170 Marshall Plaza Anchored Retail $1,900,000 $1,897,302
-32-
<PAGE>
EXHIBIT F
MLMI 1997-C1
DAIWA
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxvii)
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
------- ------------- ------------- -------- ------------
170 Marshall Plaza * Anchored Retail $1,900,000 $1,897,302
*The mortgagee is not named as a beneficiary with the respect to the "out
parcels" only.
-33-
<PAGE>
EXHIBIT G
MLMI 1997-C1
DAIWA
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxviii)
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
------- ------------- ------------- -------- ------------
170 Marshall Plaza * Anchored Retail $1,900,000 $1,897,302
*No business interruption insurance exists with respect to the "out parcel"
only.
-34-
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT H
MLMI 1997-C1
DAIWA
LIST OF MORTGAGED PROPERTIES WHICH CARRY
SIX MONTHS OF BUSINESS INTERRUPTION
OR RENT INSURANCE
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
------- ------------- ------------- -------- ------------
<S> <C> <C> <C> <C>
140 Rustic Village Apartments Multifamily $2,900,000 $2,880,433
155 El Royale Apartments Multifamily $2,500,000 $2,471,310
156 Terrytown Village Apartments Multifamily $1,980,000 $1,956,168
157 Santa Fe Square Multifamily $1,800,000 $1,783,444
158 Lochhaven Apartments Multifamily $3,000,000 $2,908,489
159 Valle Sereno Apartments Multifamily $1,925,000 $1,850,991
160 Landmark Towers Apartments Multifamily $2,700,000 $2,660,360
161 Spring Ridge Apartments Multifamily $1,625,000 $1,602,984
162 Danubia Apartments Multifamily $1,718,000 $1,708,816
</TABLE>
-35-
<PAGE>
EXHIBIT I
MLMI 1997-C1
DAIWA
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxix)
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance
------- ------------- ------------- -------- ------------
<S> <C> <C> <C> <C>
139 Holiday Inn - St. Augustine * Hospitality $2,236,000 $2,233,541
</TABLE>
*Flood Insurance has been purchased and will be effective by July 26, 1997.
-36-
<PAGE>
EXHIBIT J-1
LIST OF MORTGAGED PROPERTIES SUBJECT TO
SECONDARY LIENS
None.
-37-
<PAGE>
EXHIBIT J-2
LIST OF MORTGAGED PROPERTIES SUBJECT TO
SECONDARY LIENS
None.
-38-
<PAGE>
EXHIBIT K
MLMI 1997-C1
DAIWA
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxxvii)
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Tenant Property Type Balance Balance
------- ------------- ------ ------------- -------- ------------
<S> <C> <C> <C> <C> <C>
164 Capitol Plaza Shopping Center 50 Off Store Anchored Retail $ 4,700,000 $ 4,672,725
168 Waverly Place Shopping Center Harris Teeter Anchored Retail $10,880,000 $10,853,610
182 Markham Building * Office $ 2,175,000 $ 2,173,808
*Various leases which in the aggregate do not have a material adverse impact on
the Mortgage Loan.
</TABLE>
-39-
<PAGE>
EXHIBIT L
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxxviii)
None.
-40-
<PAGE>
EXHIBIT M
MLMI 1997-C1
DAIWA
LIST OF PRINCIPAL BORROWERS
WITH MULTIPLE MORTGAGE LOANS
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Balance Balance Borrower Entity Name
------- ------------- ------------- -------- ------------- --------------------
<S> <C> <C> <C> <C> <C>
146 Holiday Inn Express-Oakhurst Hospitality $1,520,000 $1,501,373 Yogeshwar Investment Corp.
147 Holiday Inn Express-Mariposa Hospitality $1,700,000 $1,679,167 Rangnav, Inc.
148 Holiday Inn Express-Fresno Hospitality $1,980,000 $1,955,735 Valley Prime Investment Corp.
172 Kristopher Woods Apartments Multifamily $4,045,000 $4,020,626 Kristopher Woods Associates LP
173 Lantern Ridge Apartments Multifamily $3,650,000 $3,627,413 Lantern Ridge Associates, L.P.
176 Shoreham Apartments Multifamily $2,978,000 $2,959,572 Shoreman Associates, L.P.
177 Tahoe North Apartments-Phase I Multifamily $5,845,000 $5,817,174 Tahoe North I Associates, L.P.
178 Tahoe North Apartments-PhaseII Multifamily $8,335,000 $8,295,321 Tahoe North II Associates,L.P.
175 Lakeside Villa Apartments Multifamily $6,620,000 $6,582,518 Lakeside Villa Associates L.P.
166 Belleview Plaza Shopping Ctr Anchored Retail $6,065,000 $6,043,116 IPF/Belleview L P.
164 Capitol Plaza Shopping Center Anchored Retail $4,700,000 $4,672,725 IPF/Capitol Limited Partnershp
163 Harker Heights Shopping Center Anchored Retail $2,300,000 $2,287,271 Harker Hgts. Shopping Ctr. LLC
138 Highland Point Shopping Center Anchored Retail $3,350,000 $3,329,755 BLI Highland Point, LTD.
</TABLE>
Control
Number Principal Name
------- --------------
146 Mukesh Desai, A.K. Patel, J.D. Patel, S.K. Patel, K.K. Patel
147 Mukesh Desai, A.K. Patel, J.D. Patel, S.K. Patel, K.K. Patel
148 Mukesh Desai, A.K. Patel, J.D. Patel, S.K. Patel, K.K. Patel
172 Robert A. Fischbach, R.L. Dougherty
173 Robert A. Fischbach, R.L. Dougherty
176 Robert A. Fischbach, R.L. Dougherty
177 Robert A. Fischbach, R.L. Dougherty
178 Robert A. Fischbach, R.L. Dougherty
175 Robert A. Fischbach, R.L. Dougherty
166 K. Rosen, Michael Hochberger
164 K. Rosen, Michael Hochberger
163 David Lane
138 David Lane
-41-
MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement, dated as of June 1, 1997 (the
"Agreement"), between GE Capital Access, Inc. (the "Seller") and Merrill Lynch
Mortgage Investors, Inc. (the "Purchaser").
The Seller intends to sell and the Purchaser intends to purchase,
without recourse except as specifically provided herein, certain multifamily and
commercial mortgage loans (the "Mortgage Loans") as provided herein. The
Purchaser intends to deposit them, together with the Daiwa Mortgage Loans (as
defined below) and MLMC Mortgage Loans (as defined below), into a trust fund
(the "Trust Fund"), the beneficial ownership of which will be evidenced by
multiple classes (each, a "Class") of mortgage pass-through certificates (the
"Certificates"). One or more "real estate mortgage investment conduit" ("REMIC")
elections will be made with respect to the Trust Fund. The Trust Fund will be
created and the Certificates will be issued pursuant to a Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of June 1, 1997 (the
"Cut-off Date"), among the Purchaser as depositor, GE Capital Asset Management
Corporation as master servicer (in such capacity, the "Master Servicer"), GE
Capital Realty Group, Inc. as special servicer (in such capacity, the "Special
Servicer"), General Electric Capital Corporation, ABN AMRO Bank N.V. as fiscal
agent (in such capacity, the "Fiscal Agent") and LaSalle National Bank as
trustee (the "Trustee"). Concurrently with the purchase of Mortgage Loans
pursuant to this Agreement, the Purchaser will also purchase multifamily and
commercial mortgage loans pursuant to a Mortgage Loan Purchase Agreement, dated
as of June 1, 1997, between Daiwa Finance Corp. ("Daiwa") and the Purchaser (the
"Daiwa Agreement") and pursuant to a Mortgage Loan Purchase Agreement, dated as
of June 1, 1997, between Merrill Lynch Mortgage Capital Inc. ("MLMC") and the
Purchaser (the "MLMC Agreement"). Such mortgage loans (the "Daiwa Mortgage
Loans" and the "MLMC Mortgage Loans", respectively) will likewise be deposited
into the Trust Fund. Capitalized terms used but not defined herein have the
respective meanings set forth in the Pooling and Servicing Agreement.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
(a) The Seller agrees to sell, and the Purchaser agrees to purchase,
without recourse except as specifically provided herein, the Mortgage Loans
identified on the schedule (the "Mortgage Loan Schedule") annexed hereto as
Exhibit A. The Mortgage Loan Schedule may be amended to reflect the actual
<PAGE>
Mortgage Loans. (The Mortgage Loans identified on the Mortgage Loan Schedule
shall hereinafter be referred to as the "GECA Mortgage Loans.") The GECA
Mortgage Loans will have an aggregate principal balance of $160,978,732 (the
"GECA Balance") as of the close of business on the Cut-off Date, after giving
effect to any payments due before such date whether or not received. The GECA
Balance, the Daiwa Balance (as defined in the Daiwa Agreement) and the MLMC
Balance (as defined in the MLMC Agreement) together equal an aggregate principal
balance (the "Initial Pool Balance") of $840,787,856. The purchase and sale of
the GECA Mortgage Loans shall take place on June 26, 1997 or such other date as
shall be mutually acceptable to the parties hereto (the "Closing Date"). The
consideration for the GECA Mortgage Loans shall consist of a cash amount equal
to (A) 100% of the GECA Balance, plus (B) interest accrued on each MLMC Mortgage
Loan at the related Mortgage Rate, for the period from and including the Cut-off
Date up to but not including the Closing Date, which cash amount shall be paid
to the Seller or its designee by wire transfer in immediately available funds on
the Closing Date.
The Purchaser will assign to the Trustee, all of its right, title
and interest in and to the GECA Mortgage Loans.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 hereof, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Purchaser, without
recourse, all the right, title and interest of the Seller in and to the GECA
Mortgage Loans identified on the Mortgage Loan Schedule as of such date. The
Mortgage Loan Schedule, as it may be amended, shall conform to the requirements
set forth in this Agreement and the Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive all
scheduled payments of principal and interest due after the Cut-off Date, and all
other recoveries of principal and interest collected after the Cut-off Date
(other than in respect of principal and interest on the GECA Mortgage Loans due
on or before the Cut-off Date). All scheduled payments of principal and interest
due on or before the Cut-off Date but collected after the Cut-off Date, and
recoveries of principal and interest collected on or before the Cut-off Date
(only in respect of principal and interest on the GECA Mortgage Loans due on or
before the Cut-off Date), shall belong to, and be promptly remitted to, the
Seller.
(c) The Seller hereby represents and warrants that it has, on behalf
of the Purchaser, delivered to the Trustee, the documents and instruments
specified below with respect to each GECA Mortgage Loan (each a "Mortgage
File"). All Mortgage Files so delivered will be held by the Trustee in escrow at
all times prior to the Closing Date. Each Mortgage File shall, except as
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<PAGE>
otherwise disclosed on Exhibit B hereto, contain the following documents:
(i) the original executed Mortgage Note, endorsed (including
interim endorsements and without recourse,
representation or warranty, express or implied) to the
order of LaSalle National Bank, as trustee for the
registered holders of Merrill Lynch Mortgage Investors,
Inc., Mortgage Pass-Through Certificates, Series
1997-C1;
(ii) an original or copy of the Mortgage and of any
intervening assignments thereof, in each case with
evidence of recording indicated thereon;
(iii) an original or copy of any related Assignment of Leases
(with recording information indicated thereon), if such
item is a document separate from the Mortgage;
(iv) an original executed assignment of the Mortgage, any
related Assignment of Leases (if such item is a document
separate from the Mortgage), and any other recorded
document relating to the Mortgage Loan otherwise
included in the Mortgage File, in favor of LaSalle
National Bank, as trustee for the registered holders of
Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1;
(v) an original assignment of all unrecorded documents
relating to the Mortgage Loan, in favor of LaSalle
National Bank, as trustee for the registered holders of
Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1997-C1, in recordable
form;
(vi) originals or copies of any written modification
agreements in those instances where the terms or
provisions of the Mortgage or Mortgage Note have been
modified;
(vii) the original or a copy of the policy or certificate of
lender's title insurance issued in connection with the
origination of such Mortgage Loan, or, if such policy
has not been issued, an irrevocable, binding commitment
to issue such title insurance policy; and
(viii) filed copies of any prior UCC Financing Statements in
favor of the originator of such
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<PAGE>
Mortgage Loan or in favor of any assignee prior to the
Trustee (but only to the extent the Seller had
possession of such UCC Financing Statements prior to the
Closing Date) and, if there is an effective UCC
Financing Statement in favor of the Seller on record
with the applicable public office for UCC Financing
Statements, an original UCC-2 or UCC-3, as appropriate,
in favor of LaSalle National Bank, as trustee for the
registered holders of Merrill Lynch Mortgage Investors,
Inc., Mortgage Pass-Through Certificates, Series
1997-C1.
(d) Within 30 days following the Closing Date, the Purchaser shall
submit or cause to be submitted for recordation or filing, as the case may be,
in the appropriate public office for real property records or Uniform Commercial
Code financing statements, as appropriate, each assignment of Mortgage and each
assignment of Assignment of Leases referred to in clause (iv) of subsection (c)
above and each UCC-2 and UCC-3 in favor of and delivered to the Trustee
constituting part of the Mortgage File. If any such document or instrument is
lost or returned unrecorded or unfiled, as the case may be, because of a defect
therein, then the Seller shall promptly prepare a substitute therefor or cure
such defect or cause such to be done, as the case may be, and the Seller shall
promptly deliver such substitute or corrected document or instrument to the
Purchaser or its designee.
(e) All documents necessary to the servicing of the GECA Mortgage
Loans and in the Seller's possession (the "Additional Mortgage Loan Documents")
that are not required to be delivered to the Trustee shall be delivered or
caused to be delivered by the Seller to the Master Servicer or at the direction
of the Master Servicer, to the appropriate sub-servicer.
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants with
the Purchaser, as of the date hereof, that:
(i) The Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and
is duly authorized and qualified to transact any and all business
contemplated by this Agreement and possesses all requisite authority,
power, licenses, permits and franchises to execute, deliver and comply
with its obligations under the terms of this Agreement and to carry on its
business as currently conducted by it, except to the extent that the
failure to obtain the same would not, in the Seller's good faith judgment,
materially and adversely affect the condition (financial or other),
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<PAGE>
operations of the Seller or its properties, or the value of the Mortgage
Loans.
(ii) This Agreement has been duly and validly authorized,
executed and delivered by the Seller and, assuming due authorization,
execution and delivery hereof by the Purchaser, constitutes a legal, valid
and binding obligation of the Seller, enforceable against the Seller in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights in general and by general
equity principles (regardless of whether such enforcement is considered in
a proceeding in equity or at law), or by public policy considerations
underlying the securities laws, to the extent that such public policy
considerations limit the enforceability of the provisions of this
Agreement which purport to provide indemnification from liabilities under
applicable securities laws.
(iii) The execution and delivery of this Agreement by the
Seller and the Seller's performance and compliance with the terms of this
Agreement will not (A) violate the Seller's certificate of incorporation
or By-Laws, (B) violate any law or regulation or any administrative decree
or order to which it is subject or (C) constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default)
under, or result in the breach of, any material contract, agreement or
other instrument to which the Seller is a party or which may be applicable
to the Seller or any of its assets.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or other governmental agency or body, which default might
have consequences that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the condition (financial or
other) or operations of the Seller or its properties or have consequences
that would materially and adversely affect its performance hereunder.
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any certificate of incorporation, bylaws or any
other corporate restriction or any judgment, order, writ, injunction,
decree, law or regulation that would, in the Seller's reasonable and good
faith judgment, materially and adversely affect the ability of the Seller
to perform its obligations under this Agreement or that requires the
consent of any third person to the execution of this Agreement or the
performance by the Seller of its obligations under this Agreement.
-5-
<PAGE>
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery and
performance by the Seller of or compliance by the Seller with this
Agreement or the consummation of the transactions contemplated by this
Agreement and no bulk sale law applies to such transactions.
(vii) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller that would, in the Seller's good
faith and reasonable judgment, prohibit its entering into this Agreement
or adversely affect the performance by the Seller of its obligations under
this Agreement.
(viii) Under generally accepted accounting principles ("GAAP")
and for federal income tax purposes, the Seller will report the transfer
of the GECA Mortgage Loans to the Purchaser as a sale of the GECA Mortgage
Loans to the Purchaser in exchange for consideration consisting of a cash
amount equal to (A) 100% of the GECA Balance, plus (B) interest accrued on
each GECA Mortgage Loan at the related Mortgage Rate, for the period from
and including the Cut-off Date up to but not including the Closing Date.
The consideration received by the Seller upon the sale of the GECA
Mortgage Loans to the Purchaser will constitute reasonably equivalent
value and fair consideration for the GECA Mortgage Loans. The Seller will
be solvent at all relevant times prior to, and will not be rendered
insolvent by, the sale of the GECA Mortgage Loans to the Purchaser. The
Seller is not selling the GECA Mortgage Loans to the Purchaser with any
intent to hinder, delay or defraud any of the creditors of the Seller.
(ix) Immediately prior to the sale of the GECA Mortgage Loans
to the Purchaser as herein contemplated, the Seller will have good title
thereto and be the sole owner thereof, and such sale will transfer the
GECA Mortgage Loans to the Purchaser free and clear of any pledge, lien,
encumbrance or security interest.
(x) The Prospectus dated June 5, 1997, as of the date of the
Prospectus Supplement dated June 20, 1997 (the "Prospectus Supplement"),
or as of the Closing Date, does not include any untrue statement of a
material fact relating to the MLMC Mortgage Loans or the Seller in the
Sections entitled "SUMMARY-Mortgage Loan Sellers", "SUMMARY-The Mortgage
Pool" and "DESCRIPTION OF THE MORTGAGE POOL" in the Prospectus Supplement,
or omitted or omits to state therein a material fact necessary in order to
make the statements in such Sections relating to the GECA Mortgage Loans
or the Seller, in light of the circumstances under which they were made,
not misleading, and the Memorandum (as defined in the Certificate Purchase
Agreement, dated as of June 26, 1997), as of the date thereof or as of the
Closing Date, insofar as
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<PAGE>
the Memorandum incorporates such sections of the Prospectus Supplement,
does not include any untrue statement of a material fact relating to the
GECA Mortgage Loans or the Seller or omitted or omits to state therein a
material fact necessary in order to make the statements therein relating
to the GECA Mortgage Loans or the Seller, in the light of the
circumstances under which they were made, not misleading. As the sole
remedy for breach of this representation, the Seller shall indemnify the
Purchaser against any and all losses, claims, damages or liabilities to
which the Purchaser may become subject as a result of the breach of the
representations contained in this Section 3(a)(x) pursuant to Section 7
hereof.
(b) The Seller hereby represents and warrants for the benefit of the
Purchaser and the Trustee for the benefit of the Certificateholders, as of the
Closing Date, with respect to each GECA Mortgage Loan, that:
(i) The Seller has good and marketable title to, and is the
sole owner and holder of, the Mortgage Loan.
(ii) The Seller has full right and authority to sell, assign
and transfer the Mortgage Loan.
(iii) The information pertaining to the Mortgage Loan set
forth in the Mortgage Loan Schedule is true, correct and complete in all
material respects as of the Cut-off Date.
(iv) The related Mortgagor has represented to the Seller or
the Mortgagee, as applicable, that as of the date of origination of the
Mortgage Loan, such Mortgagor, lessee and/or operator was in possession of
all licenses, permits, and authorizations then required for use of the
Mortgaged Property which were valid and in full force and effect as of the
origination date.
(v) The origination, servicing and collection practices used
by the Seller and, to the best of Seller's knowledge, any prior holder of
the Mortgage Note have been in all respects legal, proper and prudent and
have met customary industry standards.
(vi) The Seller is transferring the Mortgage Loan to the
Purchaser free and clear of any liens, pledges, charges and security
interests and the related Mortgage and Mortgage Note do not prohibit such
transfer.
(vii) The proceeds of the Mortgage Loan have been fully
disbursed and there is no requirement for future advances thereunder.
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<PAGE>
(viii) If such Mortgage Loan was originated by the Seller or
an affiliate thereof, the Mortgage Loan complied with all applicable
usury, truth-in-lending, real estate settlement, equal credit opportunity,
disclosure and any other material laws applicable to such origination as
of the origination date; and if such Mortgage Loan was not originated by
the Seller or an affiliate thereof, then, to the best of the Seller's
knowledge after having performed the type of due diligence customarily
performed by prudent institutional commercial and multifamily mortgage
lenders, the Mortgage Loan complied with all applicable usury,
truth-in-lending, real estate settlement, equal credit opportunity,
disclosure and any other material laws applicable to the origination of
such Mortgage Loan as of the origination date.
(ix) Each of the related Mortgage Note, related Mortgage and
other agreements executed in connection therewith is the legal, valid and
binding obligation of the maker thereof (subject to any non-recourse
provisions contained in any of the foregoing agreements and any applicable
state anti-deficiency legislation), enforceable in the applicable state in
accordance with its terms and contains customary and enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for the realization against the related Mortgaged Property or
properties of the benefits of the security, including realization by
judicial or, if applicable, non-judicial foreclosure, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally, and by general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law), and, to
the best of Seller's knowledge, there is no valid defense, counterclaim or
right of offset or rescission available to the related Mortgagor as of the
Closing Date with respect to such Mortgage Note, Mortgage or other
agreements.
(x) The Mortgage File contains an Assignment of Leases (or the
related Mortgage provides for such an assignment), which creates, in favor
of the holder of the Note, a valid first-priority assignment of or
security interest in the right to receive all payments due under the
related leases, and no other person owns any interest therein superior to
or of equal priority with the interest created under such assignment;
provided that the enforceability of such lien is subject to applicable
bankruptcy, insolvency, reorganization, moratorium, and other laws
affecting the enforcement of creditors' rights generally, and by the
application of the rules of equity.
(xi) Since the origination of the Mortgage Loan the terms of
the related Mortgage Note, Mortgage and
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<PAGE>
Security Agreements have not been impaired, waived, modified, altered,
satisfied, canceled or subordinated by the Seller, the originator or the
servicer thereof in any respect, except, in each of the foregoing
instances, by written instruments that are a part of the related Mortgage
File, recorded in the applicable public recording office if necessary to
maintain the priority of the lien of the related Mortgage and Security
Agreements and delivered to the Purchaser.
(xii) The Mortgage Loan complies with the Seller's or the
Seller's affiliate's that originated the Mortgage Loan underwriting
policies in effect as of such Mortgage Loan's origination date or, in the
case of Mortgage Loans acquired by the Seller (other than from an
affiliate), as of the date of such acquisition, (as applicable), and,
except for the Mortgage Loans acquired by the Seller, is on a form
commonly used by the Seller as of such date.
(xiii) The related Mortgage Note is not secured by any
collateral that is not being transferred to the Purchaser and each
Mortgage Loan that is cross-collateralized is cross-collateralized only
with other Mortgage Loans sold pursuant to this Agreement.
(xiv) The assignment of the related Mortgage and assignment of
leases to the Trustee constitutes the legal, valid, binding and
enforceable assignment of such Mortgage in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights generally, and by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in
equity or at law).
(xv) The Mortgage Loan is not a participation interest in a
mortgage loan, but is a whole loan, and the Seller does not own any equity
interest in the Mortgagor.
(xvi) Except with respect to the Mortgage Loans listed on
Exhibit C attached hereto, which provide for hyperamortization, the
Mortgage Loan does not contain any terms providing for a contingent
interest, or negative amortization.
(xvii) The related Mortgage creates a first-mortgage lien on
the related Mortgaged Property. Such lien has priority over all other
liens and encumbrances (including mechanic's or materialmen's liens)
except for (A) the lien for current real estate taxes and assessments not
yet due and payable and (B) covenants, conditions and restrictions, rights
of way, easements and other non-lien matters that are of public record and
are referred to in the related lender's title insurance policy, none of
which,
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<PAGE>
individually or in the aggregate, materially interferes with the security
intended to be provided by such Mortgage. A UCC financing statement has
been filed and/or recorded in all places necessary to perfect a valid
security interest in the personal property, granted under such Mortgage
for which perfection is accomplished by the filing of a UCC financing
statement; any security agreement, chattel mortgage or equivalent document
related to and delivered in connection with the Mortgage Loan establishes
and creates a valid and enforceable first lien and first priority security
interest on the property described therein, provided that enforceability
may be limited by bankruptcy or other laws affecting creditor's rights or
by the application of the rules of equity.
(xviii) The related Mortgage Note and Mortgage do not require
the Mortgagee thereof to release any portion of the related Mortgaged
Property from the lien of the Mortgage that would have a material and
adverse affect on the related Mortgage Loan except upon payment in full of
the Mortgage Loan.
(xix) As of the Cut-off Date, there are no delinquent taxes,
assessments or other governmental charges which would be a lien against
the related Mortgaged Property affecting the related Mortgaged Property or
an escrow of funds in an amount sufficient to cover such payments has been
established.
(xx) Except as set forth in Exhibit D attached hereto, all
escrows, reserves, deposits and other payments relating to the Mortgage
Loan are under the control of the Seller or servicer of such Mortgage Loan
and all amounts required as of the date hereof under the Mortgage Loan
Documents to be deposited by the related Mortgagor have been deposited and
to the best of Seller's knowledge, to the extent such amounts have been
applied, they have been applied as intended. All such escrows, reserves,
deposits and other payments have been conveyed by the Seller to the
Trustee.
(xxi) (A) Except for certain delinquent payments, none of
which were thirty (30) or more days past the date when first due, since
the later of one year prior to the Closing Date or, if applicable, the
date of acquisition by the Mortgage Loan Seller of such Mortgage Loan,
through the Cut-Off Date, there was no material default, breach, violation
or event of acceleration existing under the related Mortgage or the
related Mortgage Note, and to the best knowledge of Seller, after due
inquiry, no event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute a material
default, breach, violation or event of acceleration; and (B) the Seller
has not waived any material
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<PAGE>
default, breach, violation or event of acceleration of any of the
foregoing, and, pursuant to the terms of the related Mortgage or the
related Mortgage Note, no person or party other than the holder of such
Mortgage Note may declare any event of default or accelerate the related
indebtedness under either of such Mortgage or Mortgage Note.
(xxii) Except as set forth in Exhibit E attached hereto, the
related Mortgage provides that the Mortgagor is required to provide to the
Mortgagee at least annually an operating statement, rent roll (if
applicable and if requested by the Mortgagee) and balance sheet, and if
requested in accordance with the terms of the Mortgage Loan, rent rolls,
with respect to the Mortgaged Property certified by a duly authorized
officer of the Mortgagor as true and correct as of the date thereof.
(xxiii) There is no proceeding known to the Seller to be
pending, after due inquiry, or threatened in writing for the total or
partial condemnation of a material part of the related Mortgaged Property,
and the Mortgaged Property is free and clear of any damage not covered by
insurance that would materially and adversely affect its value as security
for the Mortgage Loan; to the Seller's actual knowledge, there are no
pending actions, suits or proceedings by or before any court or
governmental authority against or affecting the related Mortgagor or the
related Mortgaged Property that, if determined adversely to such Mortgagor
or Mortgaged Property, would materially and adversely affect the value of
the Mortgaged Property or the ability of the Mortgagor to pay principal,
interest or any other amounts due under such Mortgage Loan.
(xxiv) Based on the type of due diligence customarily
performed by prudent institutional commercial and multifamily mortgage
lenders, each improvement located on or forming part of the related
Mortgaged Property complies with applicable laws and zoning ordinances, or
constitutes a legal non-conforming use or structure or, if such an
improvement does not so comply, such non-compliance does not materially
and adversely affect the value or operation of the Mortgaged Property.
(xxv) None of the improvements included for the purpose of
determining the appraised value of the related Mortgaged Property at the
time of the origination of the Mortgage Loan lies outside of the
boundaries and building restriction lines of the related Mortgaged
Property, except for certain immaterial encroachments therefrom, and no
improvements on adjoining properties materially encroach upon the related
Mortgaged Property.
(xxvi) The related Mortgaged Property is covered by an ALTA
lender's title insurance policy or its
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<PAGE>
equivalent, insuring for the benefit of the original holder of the related
Note, its successors and assigns, that the related Mortgage is a valid
first mortgage lien on such Mortgaged Property in the original principal
amount of the related Note, subject only to the exceptions stated therein,
which do not and will not materially and adversely interfere with (1) the
ability of the related Mortgagor timely to pay in full the principal and
interest on the related Mortgage Note, or (2) the use of such Mortgaged
Property for the use currently being made thereof, or (3) the value of the
Mortgaged Property, and such policy is freely assignable to the trustee
without the consent of or any notification to the insurer; and such title
insurance policy is in full force and effect, no claims have been made
thereunder and to the best knowledge of the Seller, no holder of the
related Mortgage has done anything that would materially impair the
coverage under such policy.
(xxvii) The related Mortgaged Property is insured by a fire
and extended perils insurance policy that provides coverage in an amount
not less than the lesser of (a) the outstanding principal balance of the
Mortgage Loan and (b) the full replacement cost and, in any event, such
insurance policy is in an amount necessary to avoid the operation of any
co-insurance provisions with respect to the Mortgaged Property; each
related Mortgage obligates the related Mortgagor to maintain or cause to
be maintained all such insurance and at such Mortgagor's failure to do so,
does not prohibit the Mortgagee from maintaining such insurance, and such
insurance requires, or the related Mortgage requires the Mortgagor to
cause the related insurer to provide, prior notice to the Mortgagee at
termination or cancellation, and no such notice has been received; any
insurance proceeds in respect of a casualty loss or taking, will be
applied either to the repair or restoration of all or part of the related
Mortgaged Property or the payment of the outstanding principal balance of
the related Mortgage Loan, except for certain amounts not greater than
amounts which would be considered prudent by an institutional commercial
mortgage lender with respect to a similar mortgage loan and which are set
forth in the related Mortgage. Except as set forth on Exhibit F attached
hereto, the Mortgagee is named as a beneficiary under such insurance
policy.
(xxviii) Except as set forth on Exhibit G attached hereto, the
related Mortgaged Property is insured by business interruption or rent
insurance, in an amount at least equal to 12 months (or, in the case of
the Mortgage Loans listed in Exhibit H attached hereto, 6 months) of
operations of such Mortgaged Property and comprehensive general liability
insurance in an amount not less than $1 million per occurrence.
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<PAGE>
(xxix) Except as set forth on Exhibit I attached hereto, no
improvements on a related Mortgaged Property are located in a "flood
hazard area" as defined by the Federal Insurance Administration or, if so
located, are covered by flood hazard insurance.
(xxx) The Mortgage Loan represents a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code. The Seller
represents and warrants that, either as of the date of origination or the
Closing Date, the fair market value of the property securing the Mortgage
Loan was not less than 80% of the "adjusted issue price" (within the
meaning of the REMIC Provisions) of such Mortgage Loan.
(xxxi) Prepayment Premiums and Yield Maintenance Charges
payable with respect to the Mortgage Loan, if any, constitute "customary
prepayment penalties" within the meaning of Treasury regulation Section
1.860G-1(b)(2).
(xxxii) A Phase I Environmental Site Assessment was performed
with respect to the related Mortgaged Property. Such Phase I Environmental
Site Assessment was performed within eight (8) months prior to their
respective dates of origination. A report of such Phase I Environmental
Site Assessment has been delivered to the Purchaser, and the Seller (or
its affiliate that originated the Mortgage Loan), having made no
independent inquiry other than reviewing such report, has no knowledge of
any material and adverse environmental condition or circumstance affecting
the related Mortgaged Property that was not disclosed in such report. To
the extent any such condition or circumstance was disclosed, there has
been escrowed an amount of money considered sufficient by the Seller,
based upon the related environmental reports, to cure and remedy such
condition or circumstance as recommended in the Phase I or, where
applicable, Phase II Environmental Site Assessment or such condition has
been cured and remedied. The Seller has received no notice of any other
such condition or circumstance.
(xxxiii) The Mortgage Loan contains a representation made by
the Mortgagor in substance that it has not and will not use, cause or
permit to exist on the related Mortgaged Property any hazardous materials
in any manner that violates federal, state or local laws, ordinances,
regulations or orders. The Mortgage Loan requires that the Mortgagor will
defend and hold the holder of the Mortgage and its successors and/or
assigns harmless from and against any and all losses, liabilities,
damages, injuries, penalties, fines, expenses, and claims of any kind
whatsoever (including attorney's fees and costs) paid, incurred, or
suffered by, or asserted against, any such party resulting from a breach
of any representation,
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warranty or covenant relating to environmental matters given by the
Mortgagor under the related Mortgage except for those resulting from gross
negligence or willful misconduct by the holder of the Mortgage or those
which are initially placed on, in or under the Mortgaged Property after
foreclosure or other taking of title to the Mortgaged Property by the
holder of the Mortgage. Subject to the last sentence of this clause
(xxxiii), to the best of the Seller's knowledge, having made no
independent inquiry other than reviewing Phase I and Phase II (where
applicable) Environmental Site Assessments, (i) the Mortgaged Property is
in material compliance with all applicable federal, state and local laws
pertaining to environmental regulation, contamination or clean-up, and
(ii) no notice of violation of such laws has been issued by any
governmental agency or authority, except as disclosed in environmental or
engineering assessments, including Phase I Environmental Site Assessments
or additional assessments (including Phase II Environmental Site
Assessments). To the extent any material violation was disclosed, there
has been escrowed an amount of money considered sufficient by the Seller,
based upon the related environmental reports, to cure and remedy such
condition or circumstance as recommended in the Phase I or Phase II
Environmental Site Assessment or such condition has been cured and
remedied.
(xxxiv) To the best knowledge of the Seller, after due inquiry
at origination, the Mortgagor is not a debtor in any state or federal
bankruptcy, insolvency, reorganization or similar proceeding.
(xxxv) No advance of funds has been made directly or
indirectly, by the Seller to the Mortgagor other than pursuant to the Note
and to Seller's (or its affiliate's that originated the Mortgage Loan)
knowledge, no funds have been received from any person other than such
Mortgagor for or on account of payments due on the Note.
(xxxvi) The related Mortgage prohibits, without the prior
written consent of the holder of such Mortgage, any sale or transfer of,
or pledge or lien on, the related Mortgaged Property, whether such lien
may be equal or subordinate to the lien of the related Mortgages, other
than (1) certain subordinate liens governed by standstill agreements which
each provide that the subordinate lender may not accelerate or otherwise
take any remedial action for so long as the Mortgage Loan is outstanding
(the Mortgaged Properties encumbered by such subordinate liens and the
principal amounts of and interest rates on the related debt are set forth
on Exhibit J-1 attached hereto) and (2) certain subordinate liens that may
be incurred in the future on the Mortgaged Properties set forth on Exhibit
J-2 attached hereto, provided that the future subordinate debt secured by
such liens (a) when combined with the applicable
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Mortgage Loan does not exceed an 80% loan-to-value and has at least a 1.20
debt service coverage and (b) is subject to a standstill agreement with
provisions similar to those represented above for existing subordinate
liens.
(xxxvii) If the related Mortgaged Property is a retail,
office, industrial or multifamily property, to the best of Seller's (or
its affiliate's affiliate that originated the Mortgage Loan) knowledge,
(i) the information contained in the related schedule of leases or most
recent rent roll, as the case may be, is true and correct in all material
respects, (ii) all leases set forth therein are in full force and effect,
and (iii) except as set forth in Exhibit K attached hereto, based on
Mortgagor's representations, tenant estoppel certificates or other
documents obtained by the Seller (or its affiliate that originated the
Mortgage Loan) from the related Mortgagor and/or tenants in connection
with the origination of the related Mortgage Loan, no material default by
the Mortgagor or the lessees has occurred under such leases, nor, to the
best of the Seller's knowledge, is there any existing condition which, but
for the passage of time or the giving of notice, or both, would result in
a material default under the terms of such lease.
(xxxviii) Except with respect to the Mortgage Loans identified
in Exhibit L attached hereto, if the principal balance of the related
Mortgage Loan is greater than $10 million, the related Mortgagor is a
person, other than an individual, which is formed or organized solely for
the purpose of owning and operating the Mortgaged Property (or has
covenanted to restrict its operations to owning or operating the Mortgaged
Property), does not engage in any business unrelated to such property and
its financing, does not have any assets other than those related to its
interest in the property or its financing, or any indebtedness other than
as permitted by the related Mortgage and the other Mortgage Loan
documents, has its own books and records and accounts separate and apart
from any other person, and holds itself out as being a legal entity,
separate and apart from any other person.
(xxxix) With respect to any Mortgage Loan that is secured in
whole or in part by the interest of a Mortgagor as a lessee under a Ground
Lease (for these purposes, the term "Ground Lease" includes any related
ground lessor estoppels and any other writings from ground lessor) but not
by the related fee interest:
(A) Such Ground Lease or a memorandum thereof has been duly
recorded and such Ground Lease permits the interest of the lessee
thereunder to be encumbered by the related Mortgage or, if consent of the
lessor thereunder is required, it has been obtained prior to the Closing
Date;
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(B) The Mortgagor's interest in such Ground Lease is
assignable to the Trustee without the consent of the lessor thereunder
(or, if any such consent is required, it has been obtained prior to the
Closing Date) and, in the event that it is so assigned, is further
assignable by the Trustee and its successors without a need to obtain the
consent of such lessor;
(C) Such Ground Lease may not be amended, modified, canceled
or terminated without the prior written consent of the Mortgagee and that
any such action without such consent is not binding on the Mortgagee, its
successors or assigns.
(D) Unless otherwise set forth in the Ground Lease, the Ground
Lease does not permit any increase in the amount of rent payable by the
Ground Lessee thereunder during the term of the Mortgage Loan.
(E) To the best of the Seller's knowledge, at the Closing
Date, such Ground Lease is in full force and effect and no default or
condition which with passage of time would become a default, has occurred
under such Ground Lease;
(F) Such Ground Lease requires the lessor thereunder to give
notice of any default by the lessee to the Mortgagee; and such Ground
Lease, or an estoppel or consent letter received by the Mortgagee from the
lessor, further provides that no notice of termination given under such
Ground Lease is effective against the mortgagee unless a copy has been
delivered to the mortgagee in the manner described in such Ground Lease or
estoppel or consent letter;
(G) The ground lessee's interest in the Ground Lease (I) is
not subject to any liens or encumbrances superior to, or of equal priority
with, the related Mortgage, other than the related ground lessor's related
fee interest and any exceptions stated in the related title insurance
policy or opinion of title, which exceptions do not and will not
materially and adversely interfere with (1) the ability of the related
Mortgagor timely to pay in full the principal and interest on the related
Mortgage Note, (2) the use of such Mortgaged Property for the use
currently being made thereof, or (3) the value of the Mortgaged Property
and (II) will not be interfered with in the event of any foreclosure or
other action taken by any mortgagee of the ground lessor's fee interest.
(H) A Mortgagee is permitted a reasonable opportunity
(including, where necessary, sufficient time to gain possession of the
interest of the lessee under such
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Ground Lease) to cure any curable default under such Ground Lease before
the lessor thereunder may terminate such Ground Lease.
(I) Such Ground Lease has an original term (including any
extension options set forth therein) that extends not less than 10 years
beyond the final maturity date of the related Mortgage Loan.
(J) Under the terms of such Ground Lease and the related
Mortgage, taken together, any related insurance proceeds or condemnation
proceeds, will be applied either to the repair or restoration of all or
part of the related Mortgaged Property, with the lessee's mortgagee or a
trustee appointed by it having the right to hold and disburse such
proceeds as the repair or restoration progresses, or to the payment of the
outstanding principal balance of the Mortgage Loan together with any
accrued interest thereon.
(K) Such Ground Lease does not impose any restrictions on
subletting which would be viewed as commercially unreasonable by a prudent
commercial mortgage lender.
(L) Upon request, the Ground Lessor is required to enter into
a new lease upon termination of the Ground Lease for any reason, on
substantially similar terms and conditions as the old lease including the
rejection of the lease in bankruptcy.
(M) To the best of Seller's (or its affiliates which
originated the Mortgage Loan) knowledge, the terms of the related Ground
Lease have not been waived, modified, altered, satisfied, impaired,
cancelled, subordinated or rescinded in any manner which materially
interferes with the security intended to be provided by such Mortgage.
(xl) As of the Cut-off Date, the aggregate principal amount of
any Mortgage Loan or group of Mortgage Loans made to one borrower or group
of affiliated borrowers does not exceed $17,353,225. Based on information
obtained from the related Mortgagor at the time of origination, a list of
borrowers or groups of affiliated borrowers with multiple Mortgage Loans
is attached hereto as Exhibit M.
(xli) With respect to any Mortgage Loan that is secured in
whole or in part by a Mortgaged Property which is operated as a
residential health care facility (a "Facility"), if any:
(A) All governmental licenses, permits, regulatory agreements or
other approvals or agreements necessary or desirable for the use and
operation of each Facility as intended are held by the related Mortgagor
or the operator
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of the Facility, and are in full force and effect, including, without
limitation, a valid certificate of need ("CON") or similar certificate,
license, or approval issued by the applicable department of health for the
requisite number of beds, and approved provider status in any approved
provider payment program (collectively, the "Licenses").
(B) The Licenses (a) may not be, and have not been, transferred to
any location other than the Facility; (b) have not been pledged as
collateral security for any other loan or indebtedness; and (c) are held
free from restrictions or known conflicts which would materially impair
the use or operation of the Facility as intended, and are not provisional,
probationary or restricted in any way.
(C) As of the Cut-off Date and to Seller's knowledge, without
inquiry, as of the Cut-off Date, the Facility has not received a "Level A"
(or equivalent) violation which has not been cured to the satisfaction of
the applicable governmental agency, and no statement of charges or
deficiencies has been made or penalty enforcement action has been
undertaken against the Facility, its operator or the Mortgagor or against
any officer, director or stockholder of such operator or the Mortgagor by
any governmental agency during the last three calendar years, and there
have been no violations over the past three years which have threatened
the Facility's, the operator's or the Mortgagor's certification for
participation in Medicare or Medicaid or the other third-party payors'
programs.
(c) If the Seller receives notice of a Document Defect or a Breach
(the "Defect/Breach Notice"), which materially and adversely affects the
interests of the Certificateholders, then the Seller shall within 90 days after
its receipt of the Defect/Breach Notice (i) cure such Document Defect or Breach,
as the case may be, in all material respects, which shall include payment of
losses and any Additional Trust Fund Expenses associated therewith, or (ii)
repurchase the affected GECA Mortgage Loan (or the related Mortgaged Property)
from the Trustee at a price equal to the Purchase Price; provided, however, that
if such Document Defect or Breach is capable of being cured but not within such
90-day period and the Seller has commenced and is diligently proceeding with the
cure of such Document Defect or Breach within such 90-day period, the Seller
shall have an additional 90 days to complete such cure; and provided, further,
that with respect to such additional 90-day period the Seller shall have
delivered an Officer's Certificate to the Trustee setting forth the reason such
Document Defect or Breach is not capable of being cured within the initial
90-day period and what actions the Seller is pursuing in connection with the
cure thereof and stating that the Seller anticipates that such Document Defect
or Breach will be cured within the additional 90-day period. Notwithstanding the
foregoing, the delivery of a commitment to issue a policy of lender's title
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insurance as described in Section 3(b)(xxvi) in lieu of the delivery of the
actual policy of lender's title insurance shall not be considered a Document
Defect with respect to any Mortgage File if such actual policy of insurance is
delivered to the Trustee or a Custodian on its behalf not later than the 90th
day following the Closing Date. The Seller's obligation to cure a Document
Defect or Breach or to repurchase any affected GECA Mortgage Loan as described
above shall constitute the sole and exclusive remedy for a Document Defect or
Breach.
SECTION 4. Representations and Warranties of the Purchaser. In order to
induce the Seller to enter into this Agreement, the Purchaser hereby represents
and warrants for the benefit of the Seller as of the date hereof that:
(a) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. The Purchaser has
the full corporate power and authority and legal right to acquire the GECA
Mortgage Loans from the Seller and to transfer the GECA Mortgage Loans to the
Trustee.
(b) This Agreement has been duly and validly authorized, executed
and delivered by the Purchaser, all requisite action by the Purchaser's
directors and officers has been taken in connection therewith, and (assuming the
due authorization, execution and delivery hereof by the Seller) this Agreement
constitutes the valid, legal and binding agreement of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as such enforcement
may be limited by (A) laws relating to bankruptcy, insolvency, reorganization,
receivership or moratorium, (B) other laws relating to or affecting the rights
of creditors generally, or (C) general equity principles (regardless of whether
such enforcement is considered in a proceeding in equity or at law).
(c) Except as may be required under federal or state securities laws
(and will be obtained on a timely basis), no consent, approval, authorization or
order of, registration or filing with, or notice to, any governmental authority
or court, is required, under federal or state law, for the execution, delivery
and performance by the Purchaser of or compliance by the Purchaser with this
Agreement, or the consummation by the Purchaser of any transaction described in
this Agreement.
(d) None of the acquisition of the GECA Mortgage Loans by the
Purchaser, the transfer of the GECA Mortgage Loans to the Trustee, and the
execution, delivery or performance of this Agreement by the Purchaser, conflicts
or will conflict with, results or will result in a breach of, or constitutes or
will constitute a default under (A) any term or provision of the Purchaser's
Articles of Incorporation or Bylaws, (B) any term or provision of any material
agreement, contract, instrument or indenture, to which the Purchaser is a party
or by which the
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Purchaser is bound, or (C) any law, rule, regulation, order, judgment, writ,
injunction or decree of any court or governmental authority having jurisdiction
over the Purchaser or its assets.
(e) Under GAAP and for federal income tax purposes, the Purchaser
will report the transfer of the GECA Mortgage Loans by the Seller to the
Purchaser as a sale of the GECA Mortgage Loans to the Purchaser in exchange for
consideration consisting of a cash amount equal to (A) 100% of the GECA Balance,
plus (B) interest accrued on each GECA Mortgage Loan at the related Mortgage
Rate, for the period from and including the Cut-off Date up to but not including
the Closing Date.
SECTION 5. Closing. The closing of the sale of the Mortgage Loans (the
"Closing") shall be held at the offices of Willkie Farr & Gallagher, One
Citicorp Center, 153 East 53rd Street, New York, New York 10022 at 10:00 A.M.,
New York time, on the Closing Date.
The Closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller set
forth in Sections 3(a), 3(b) and 3(c) of this Agreement and all of the
representations and warranties of the Purchaser set forth in Section 4 of this
Agreement shall be true and correct in all material respects as of the Closing
Date;
(b) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and acceptable to the
Purchaser, shall be duly executed and delivered by all signatories as required
pursuant to the respective terms thereof;
(c) The Seller shall have delivered and released to the Custodian
and the Master Servicer, respectively, all documents represented to have been or
required to be delivered to the Trustee and the Master Servicer pursuant to
Section 2 of this Agreement;
(d) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with and
the Seller shall have the ability to comply with all terms and conditions and
perform all duties and obligations required to be complied with or performed
after the Closing Date; and
(e) The Seller shall have paid all fees and expenses payable by it
to the Purchaser or otherwise pursuant to this Agreement.
Both parties agree to use their best efforts to perform their
respective obligations hereunder in a manner that will
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enable the Purchaser to purchase the GECA Mortgage Loans on the Closing Date.
SECTION 6. Closing Documents. The Closing Documents shall consist of the
following:
(a) This Agreement duly executed by the Purchaser and the Seller;
(b) A Certificate of the Seller, executed by a duly authorized
officer or other authorized signatory of the Seller and dated the Closing Date,
and upon which the Purchaser and the Underwriters may rely, to the effect that:
(1) the representations and warranties of the Seller in this Agreement are true
and correct in all material respects at and as of the Closing Date with the same
effect as if made on such date; and (ii) the Seller has, in all material
respects, complied with all the agreements and satisfied all the conditions on
its part that are required under this Agreement to be performed or satisfied at
or prior to the date hereof;
(c) An Officer's Certificate from an officer of the Seller, in his
or her individual capacity, dated the Closing Date, and upon which the Purchaser
may rely, to the effect that each individual who, as an officer or
representative of the Seller, signed this Agreement or any other document or
certificate delivered on or before the Closing Date in connection with the
transactions contemplated herein, was at the respective times of such signing
and delivery, and is as of the Closing Date, duly elected or appointed,
qualified and acting as such officer or representative, and the signatures of
such persons appearing on such documents and certificates are their genuine
signatures;
(d) [Reserved];
(e) The resolutions of the board of directors of the Seller and any
requisite shareholder consent authorizing the Seller's entering into the
transactions contemplated by this Agreement (or other evidence of such
authorization acceptable to the Purchaser), the certificate of incorporation and
by-laws of the Seller, and a certificate of good standing of the Seller issued
by the Secretary of State of the State of Delaware not earlier than sixty (60)
days prior to the Closing Date;
(f) A written opinion of counsel for the Seller in form and
substance acceptable to the Purchaser and its counsel, with any modifications
required by the rating agencies identified in the Prospectus Supplement (the
"Rating Agencies"), dated the Closing Date and addressed to the Purchaser, the
Underwriters and each of the Rating Agencies, together with such other written
opinions as may be required by the Rating Agencies; and
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(g) Such further certificates, opinions and documents as the
Purchaser may reasonably request.
SECTION 7. Indemnification.
(a) The Seller agrees to indemnify and hold harmless the Purchaser,
the Underwriters, their respective officers and directors, and each person, if
any, who controls the Purchaser or the Underwriters within the meaning of either
Section 15 of the Securities Act of 1933 (the "1933 Act") or Section 20 of the
Securities Exchange Act of 1934 (the "1934 Act"), against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the 1933 Act, the 1934 Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based in whole or in part upon any untrue statement or alleged untrue
statement of a material fact relating to the GECA Mortgage Loans or the Seller
contained in the Sections entitled "SUMMARY-Mortgage Loan Sellers", "SUMMARY-The
Mortgage Pool" and "DESCRIPTION OF THE MORTGAGE POOL" in the Prospectus
Supplement, and in the Private Placement Memorandum insofar as the Private
Placement Memorandum incorporates such sections of the Prospectus Supplement, or
arise out of or are based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances in which they were made,
not misleading, which untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon any information furnished to the
Purchaser by the Seller or approved by the Seller, or upon any document
delivered to the Purchaser by the Seller, or upon any of the representations,
warranties, covenants or agreements of the Seller as set forth in this Agreement
(collectively, the "Seller's Information"), it being acknowledged that the
statements set forth in the Prospectus Supplement under the caption
"SUMMARY-Mortgage Loan Sellers", SUMMARY-The Mortgage Pool" and "DESCRIPTION OF
THE MORTGAGE POOL" and statements in the Private Placement Memorandum insofar as
the Private Placement Memorandum incorporates such sections of the Prospectus
Supplement, in each case solely to the extent relating to or based (in whole or
in part) on information relating to the GECA Mortgage Loans or the Seller, are
to be the only statements made in reliance upon information furnished or
approved by the Seller, or upon documents delivered to the Purchaser by the
Seller, or upon any of the representations, warranties, covenants or agreements
of the Seller as set forth in this Agreement.
(b) Promptly after receipt by any person entitled to indemnification
under this Section 7 (an "indemnified party") of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against the Seller (the "indemnifying party") under this Section 7, notify
the indemnifying party in writing of the commencement thereof;
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but the omission so to notify the indemnifying party will not relieve it from
any liability that it may have to any indemnified party otherwise than under
this Section 7. In case any such action is brought against any indemnified party
and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to the extent
that it may elect by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party, to assume the
defense thereof, with counsel satisfactory to such indemnified party; provided,
however, that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party or parties shall have
reasonably concluded that there may be legal defenses available to it or them
and/or other indemnified parties that are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying party
to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel, approved by the
Purchaser, representing all the indemnified parties under Section 7(a) who are
parties to such action), (ii) the indemnifying party shall not have employed
counsel satisfactory to the indemnified party to represent the indemnified party
within a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall only be in respect of the counsel
referred to in such clause (i) or (iii).
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under Section 7(a) hereof or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
the indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified and indemnifying parties
shall be determined by reference to,
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among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by such parties.
(d) The Purchaser and the Seller agree that it would not be just and
equitable if contribution pursuant to Section 7(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the considerations referred to in Section 7(c) above. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in this Section 7 shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim, except where the indemnified party is required to bear such
expenses pursuant to this Section 7, which expenses the indemnifying party shall
pay as and when incurred, at the request of the indemnified party, to the extent
that the indemnifying party will be ultimately obligated to pay such expenses.
If any expenses so paid by the indemnifying party are subsequently determined to
not be required to be borne by the indemnifying party hereunder, the party that
received such payment shall promptly refund the amount so paid to the party
which made such payment. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The indemnity and contribution agreements contained in this
Section 7 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by the Purchaser,
the Underwriters, any of their respective directors or officers, or any person
controlling the Purchaser or the Underwriters, and (iii) acceptance of and
payment for any of the Certificates.
(f) The Underwriters shall be third-party beneficiaries of the
provisions of this Section 7.
SECTION 8. Costs. The Seller shall pay (or shall reimburse the Purchaser
to the extent that the Purchaser has paid) the Seller's pro rata portion of the
aggregate of the following amounts (the Seller's pro rata portion to be
determined according to the percentage that the GECA Balance represents the
Initial Pool Balance): (i) the costs and expenses of printing (or otherwise
reproducing) and delivering a preliminary and final Prospectus and Memorandum
relating to the Certificates; (ii) the initial fees, costs, and expenses of the
Trustee (including reasonable attorneys' fees); (iii) the filing fee charged by
the Securities and Exchange Commission for registration of the Certificates so
registered; (iv) the fees charged by the Rating Agencies to rate the
Certificates so rated; (v) the expense of recording any assignment of Mortgage
or assignment of Assignment
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of Leases as contemplated by Section 2 hereof; and (vi) the cost of obtaining a
"comfort letter" from a firm of certified public accountants selected by the
Purchaser with respect to numerical information in respect of the GECA Mortgage
Loans and the Seller included in the Prospectus and Memorandum. All other costs
and expenses in connection with the transactions contemplated hereunder shall be
borne by the party incurring such expense.
SECTION 9. Notices. All notices, copies, requests, consents, demands and
other communications required hereunder shall be in writing and telecopied or
delivered to the intended recipient at the "Address for Notices" specified
beneath its name on the signature pages hereof or, as to either party, at such
other address as shall be designated by such party in a notice hereunder to the
other party. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 10. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement, incorporated herein by reference or contained in the certificates of
officers of the Seller submitted pursuant hereto, shall remain operative and in
full force and effect and shall survive delivery of the GECA Mortgage Loans by
the Seller to the Purchaser (and by the Purchaser to the Trustee).
SECTION 11. Severability of Provisions. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
which is held to be void or unenforceable shall be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation, warranty or covenant of
this Agreement that is prohibited or unenforceable or is held to be void or
unenforceable in any particular jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereto waive any provision of law which prohibits
or renders void or unenforceable any provision hereof.
SECTION 12. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but which together shall
constitute one and the same agreement.
SECTION 13. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES,
OBLIGATIONS AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED IN
ACCORDANCE WITH THE INTERNAL LAWS AND
-25-
<PAGE>
DECISIONS OF NEW YORK. THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION
5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION 14. Further Assurances. The Seller and the Purchaser agree to
execute and deliver such instruments and take such further actions as the other
party may, from time to time, reasonably request in order to effectuate the
purposes and to carry out the terms of this Agreement.
SECTION 15. Successors and Assigns. The rights and obligations of the
Seller under this Agreement shall not be assigned by the Seller without the
prior written consent of the Purchaser, except that any person into which the
Seller may be merged or consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Seller is a party, or any
person succeeding to all or substantially all of the business of the Seller,
shall be the successor to the Seller hereunder. The Purchaser has the right to
assign its interest under this Agreement, in whole or in part, as may be
required to effect the purposes of the Pooling and Servicing Agreement, and the
assignee shall, to the extent of such assignment, succeed to the rights and
obligations hereunder of the Purchaser. Subject to the foregoing, this Agreement
shall bind and inure to the benefit of and be enforceable by the Seller and the
Purchaser, and their permitted successors and assigns, and the officers,
directors and controlling persons referred to in Section 7.
SECTION 16. Amendments. No term or provision of this Agreement may be
waived or modified unless such waiver or modification is in writing and signed
by a duly authorized officer of the party against whom such waiver or
modification is sought to be enforced.
-26-
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective duly authorized officers as of the
date first above written.
SELLER
GE CAPITAL ACCESS, INC.
By: /s/ James Vincent
-----------------------------------------
Name: James Vincent
Title: Authorized Signatory
Address for Notices:
292 Long Ridge Road
Stamford, Connecticut 06927
Attention: Managing Director, CMBS
Telecopier No.: (203) 357-6364
Telephone No.: (203) 961-5400
PURCHASER
MERRILL LYNCH MORTGAGE
INVESTORS, INC.
By: /s/ Bruce L. Ackerman
-----------------------------------------
Name: Bruce L. Ackerman
Title: Vice President
Address for Notices:
World Financial Center
New York, New York 10281
Attention:
Telecopier No.: (212) 449-7684
Telephone No.: (212) 449-5849
-27-
<PAGE>
EXHIBIT A
MLMI 1997-C1
Mortgage loan Schedule
GECA
<TABLE>
<CAPTION>
Control
Number Property_Name Address City State Zip Code
- ------- ------------- ------- ---- ----- --------
<S> <C> <C> <C> <C> <C>
185 264 Water Street 264 Water Street New York NY 10038
186 Banyan Bay Apartments 703 NE 63rd Street Miami FL 33138
187 Bentsen Grove 810 N. Bentsen Palm Drive Mission TX 78572
188 Collegiate Suites 1101A Patrick Henry Drive Blacksburg VA 24060
189 Cottonwood Apartments 6441 Cypress Street Santa Fe NM 85701
190 El Dorado/Pipers Cove Apartments 240/270 El Dorado Boulevard Houston TX 77598
191 Glen Apartments 2809 West Glen Drive Falls Church VA 22046
193 Las Brisas 302 E. Union Avenue Las Cruces NM 88001
194 Morningstar Self Storage 10833 Monroe Road Matthews NC 28105
195 Oak Meadow Park 31750 NW Pacific North Plains OR 97133
196 Pepper Hill Apartments 3484 Mountainbrook Ave N. Charleston SC 29420
197 Pines of Green Run 1302 Pine Cone Circle Virginia Beach VA 23456
198 Quail Hill 5102 Galley Road Colorado Springs CO 80915
199 Stockdale Villa 3535 Stine Road Bakersfield CA 93309
200 The Chalet 6115 Jack Finney Boulevard Greenville TX 75402
201 Vista Village 5000 Butte Street Boulder CO 80301
202 Arizona Acres 9421 E. Apache Trail Mesa AZ 85207
203 Bonita Vista 2175 West Southern Avenue Apache Junction AZ 85220
204 Country Club 5600 S. Country Club Road Tucson AZ 85706
205 Rock Shadows 600 S. Idaho Road Apache Junction AZ 85220
207 Sandy Lakes Apartments 3650 E. Lake Mead Blvd. Las Vegas NV 89115
208 Tuckertown Village 41 Little Pond Road S. Kingstown RI 02879
209 6550 Collins 6550 Collins Avenue Miami Beach FL 33141
210 The Landings Apartments 3306 West Main Street Kalamazoo MI 49006
211 Claire Tower 1041 Marion Street Columbia SC 29201
212 Holden Crossing 3700 S. Holden Road Greensboro NC 27406
213 West Chase 301 N. Shackleford Road Little Rock AR 72211
214 InnsbrookApartments 18800 Innsbrook Drive Northville MI 48167
215 Holiday/Hampton 1813 W. Mercury Blvd. Hampton VA 23666
(2) 216 Terrace View 600 Trillo Road Baltimore MD 21225
(2) 216 Terrace View MD
217 Springfield Apartments 18500 Redmond Way Redmond WA 98052
218 Lakehurst Shurguard Mini-Storage 6040 Lakehurst Drive Orlando FL 32819
219 Boca / Deerfield Self Storage 3604 NW 2nd & 950 S. Powerline Rd Boca Raton & Deerfield FL 33431 & 33442
220 Devonshire Apartments 12648 N.E. 144th Street Kirkland WA 98034
<CAPTION>
Control Original Cut-off Date Monthly Gross Remaining Maturity
Number Balance Balance Payment Rate Term Amort Date
------ ------- ------------ ------- ----- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C> <C>
185 $ 3,682,500 $ 3,672,031.89 $ 30,101.00 8.680 117 297 3/1/07
186 $10,400,000 $10,372,055.90 $ 76,674.00 8.050 116 356 1/31/07
187 $ 3,734,000 $ 3,719,890.99 $ 30,622.77 8.720 116 296 1/31/07
188 $ 4,560,000 $ 4,555,861.10 $ 35,863.77 8.747 118 358 4/1/07
189 $ 8,000,000 $ 7,974,914.20 $ 62,080.94 8.600 114 354 11/30/06
190 $ 9,791,000 $ 9,779,433.09 $ 76,257.91 8.640 118 358 4/1/07
191 $ 5,400,000 $ 5,391,492.16 $ 44,198.24 8.880 118 316 4/1/07
193 $ 3,500,000 $ 3,493,627.98 $ 29,132.57 8.900 299 299 5/1/22
194 $ 2,000,000 $ 1,991,115.03 $ 16,483.66 8.780 115 295 12/31/06
195 $ 1,345,000 $ 1,343,474.40 $ 10,668.00 8.840 118 358 4/1/07
196 $ 2,595,000 $ 2,585,221.51 $ 21,334.63 8.750 116 296 1/31/07
197 $ 7,000,000 $ 6,981,169.26 $ 51,608.00 8.050 116 356 1/31/07
198 $ 2,850,000 $ 2,835,605.64 $ 23,702.78 8.890 114 294 11/30/06
199 $ 2,978,000 $ 2,968,147.93 $ 24,197.74 9.110 113 353 10/31/06
200 $ 1,462,000 $ 1,455,096.84 $ 11,723.20 8.450 115 295 1/1/07
201 $ 3,879,000 $ 3,864,084.07 $ 30,846.38 8.869 112 352 9/30/06
202 $ 2,550,000 $ 2,524,946.87 $ 18,764.33 8.030 68 344 1/26/03
203 $ 5,500,000 $ 5,475,918.34 $ 45,846.00 9.400 109 349 6/26/06
204 $ 2,450,000 $ 2,439,101.51 $ 19,943.00 9.130 74 350 7/17/03
205 $ 4,800,000 $ 4,771,985.26 $ 38,760.12 9.040 107 347 3/27/06
207 $ 3,639,000 $ 3,635,775.70 $ 30,638.10 9.040 119 299 5/1/07
208 $ 2,000,000 $ 1,998,932.33 $ 16,251.00 9.110 119 359 5/1/07
209 $ 2,025,000 $ 2,023,856.47 $ 16,061.00 8.840 143 359 4/23/09
210 $ 2,836,000 $ 2,833,427.96 $ 23,605.71 8.900 119 299 5/1/07
211 $ 2,000,000 $ 1,998,283.29 $ 17,100.00 9.230 119 299 5/1/07
212 $ 8,100,000 $ 8,100,000.00 $ 67,864.00 8.980 120 300 6/1/07
213 $ 2,500,000 $ 2,500,000.00 $ 20,894.38
214 $10,200,000 $10,200,000.00 $ 79,261.00 9.380 50 360 8/1/01
215 $11,000,000 $10,715,936.00 $101,673.99 9.380 43 223 12/31/00
(2) 216 $ 2,779,000 $ 2,725,965.85 $ 23,373.34 8.680 65 281 10/31/02
(2) 216 $ 325,090 $ 323,899.56 $ 2,710.80 8.920 65 298 10/31/02
217 $ 6,400,000 $ 6,361,564.34 $ 55,050.52 9.630 110 350 7/31/06
218 $ 1,700,000 $ 1,693,652.82 $ 14,580.66 9.730 110 350 7/31/06
219 $13,000,000 $13,000,000.00 $106,702.08 8.730 120 300 6/1/07
220 $ 4,700,000 $ 4,672,264.50 $ 39,312.19 9.310 111 351 8/31/06
<CAPTION>
Control Ground Underwriting Net Subservicing (1) Servicing Fee
Number Lease Reserves Rate Fees Fees Subservicer
------ ----- ----------- ---- ------------ ----------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
185 No 200 per unit 8.675 0.000 0.005 GE Capital Asset Management
186 No 285 per unit 8.045 0.000 0.005 GE Capital Asset Management
187 No 56.41 per pad 8.715 0.000 0.005 GE Capital Asset Management
188 No 250 per unit 8.742 0.000 0.005 GE Capital Asset Management
189 No 28.65 per pad 8.595 0.000 0.005 GE Capital Asset Management
190 No 242.54 per unit 8.635 0.000 0.005 GE Capital Asset Management
191 No 250 per unit 8.875 0.000 0.005 GE Capital Asset Management
193 No 25 per pad 8.895 0.000 0.005 GE Capital Asset Management
194 No 0.15 per sq ft 8.775 0.000 0.005 GE Capital Asset Management
195 No 25 per pad 8.835 0.000 0.005 GE Capital Asset Management
196 No 350.56 per unit 8.745 0.000 0.005 GE Capital Asset Management
197 No 342.33 per unit 8.045 0.000 0.005 GE Capital Asset Management
198 No 25 per pad 8.885 0.000 0.005 GE Capital Asset Management
199 No 25 per pad 9.105 0.000 0.005 GE Capital Asset Management
200 No 200 per unit 8.445 0.000 0.005 GE Capital Asset Management
201 Yes 25 per pad 8.864 0.000 0.005 GE Capital Asset Management
202 No 25 per pad 8.025 0.000 0.005 GE Capital Asset Management
203 No 25 per pad 9.395 0.000 0.005 GE Capital Asset Management
204 No 25 per pad 9.125 0.000 0.005 GE Capital Asset Management
205 No 25 per pad 9.035 0.000 0.005 GE Capital Asset Management
207 No 273.08 per unit 9.035 0.000 0.005 GE Capital Asset Management
208 No 89.25 per pad 9.105 0.000 0.005 GE Capital Asset Management
209 No 0.15 per sq ft 8.835 0.000 0.005 GE Capital Asset Management
210 No 224.38 per unit 8.895 0.000 0.005 GE Capital Asset Management
211 No 275 per unit 9.225 0.000 0.005 GE Capital Asset Management
212 No 0.15 per sq ft 8.975 0.000 0.005 GE Capital Asset Management
213 No 0.15 per sq ft 8.945 0.000 0.005 GE Capital Asset Management
214 No 200 per unit 9.375 0.000 0.005 GE Capital Asset Management
215 Yes 0.04 %EGI 9.375 0.000 0.005 GE Capital Asset Management
(2)216 No 25 per pad 8.675 0.000 0.005 GE Capital Asset Management
217 No 200 per unit 9.625 0.000 0.005 GE Capital Asset Management
218 No 0.2 per sq ft 9.725 0.000 0.005 GE Capital Asset Management
219 No 0.15 per sq ft 8.725 0.000 0.005 GE Capital Asset Management
220 No 200 per unit 9.305 0.000 0.005 GE Capital Asset Management
</TABLE>
-28-
<PAGE>
EXHIBIT B
MORTGAGE FILE SCHEDULE
None.
-29-
<PAGE>
EXHIBIT C
MLMI 1997-C1
GECA
LIST OF MORTGAGE LOANS WHICH
PROVIDE FOR HYPERAMORTIZATION
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property_Name Property Type Balance Balance
- ------- ------------- ------------- ------- ------------
<S> <C> <C> <C> <C>
190 El Dorado/Pipers Cove Apartments Multifamily $ 9,791,000 $ 9,779,433
195 Oak Meadow Park Mobile Home Park $ 1,345,000 $ 1,343,474
209 6550 Collins Unanchored Retail $ 2,025,000 $ 2,023,856
219 Boca / Deerfield Self Storage Self Storage $13,000,000 $13,000,000
</TABLE>
-30-
<PAGE>
EXHIBIT D
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xx)
None.
-31-
<PAGE>
EXHIBIT E
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxii)
None.
-32-
<PAGE>
EXHIBIT F
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxvii)
None.
-33-
<PAGE>
EXHIBIT G
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxviii)
None.
-34-
<PAGE>
EXHIBIT H
LIST OF MORTGAGED PROPERTIES WHICH CARRY
SIX MONTHS OF BUSINESS INTERRUPTION
OR RENT INSURANCE
None.
-35-
<PAGE>
EXHIBIT I
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTION
TO SECTION 3(b)(xxix)
None.
-36-
<PAGE>
EXHIBIT J-1
LIST OF MORTGAGED PROPERTIES SUBJECT TO
SECONDARY LIENS
None.
-37-
<PAGE>
EXHIBIT J-2
MLMI 1997-C1
GECA
MORTGAGED PROPERTIES WITH POTENTIAL
FUTURE LIENS
Control Original Cut-Off Date
Number Property_Name Property Type Balance Balance
------ ------------- ------------- -------- ------------
200 The Chalet Multifamily $1,462,000 $1,455,097
-38-
<PAGE>
EXHIBIT K
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxxvii)
None.
-39-
<PAGE>
EXHIBIT L
MLMI 1997-C1
GECA
LIST OF MORTGAGE LOANS WHICH ARE EXCEPTIONS
TO SECTION 3(b)(xxxviii)
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property_Name Property Type Balance Balance
- ------- ------------- ------------- -------- ------------
<S> <C> <C> <C>
215 Holiday Inn/Hampton Inn Hospitality $11,000,000 $10,715,936
219 Boca / Deerfield Self Storage Self Storage $13,000,000 $13,000,000
</TABLE>
-40-
<PAGE>
EXHIBIT M
MLMI 1997-C1
GECA
LIST OF PRINCIPAL BORROWERS
WITH MULTIPLE MORTGAGE LOANS
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property_Name Property Type Balance Balance Borrower Entity Name
- ------- ------------- ------------- ------- ------------ --------------------
<S> <C> <C> <C> <C> <C>
186 Banyan Bay Apartments Multifamily $10,400,000 $10,372,056 Atlantic Properties Assoc. L.P.
197 Pines of Green Run Multifamily $ 7,000,000 $ 6,981,169 Pines of Green Run L.P.
198 Quail Hill Mobile Home Park $ 2,850,000 $ 2,835,606 Quail Hill MHP Ltd
199 Stockdale Villa Mobile Home Park $ 2,978,000 $ 2,968,148 Stockdale Villa MHP Ltd.
201 Vista Village Mobile Home Park $ 3,879,000 $ 3,864,084 Boulder Vista Village MHP Ltd.
217 Springfield Apartments Multifamily $ 6,400,000 $ 6,361,564 Springfield Properties L.P.
220 Devonshire Apartments Multifamily $ 4,700,000 $ 4,672,265 Devonshire Development LP
216 Terrace View Mobile Home Park $ 2,779,000 $ 2,725,966 RR&D Associates
216 Terrace View Mobile Home Park $ 325,090 $ 323,900 RR&D Associates
</TABLE>
-41-
