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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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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): March 27, 1998
MERRILL LYNCH MORTGAGE INVESTORS, INC.
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(Exact name of registrant as specified in its governing instruments)
Delaware 333-38073 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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<PAGE>
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 March 27, 1998, a single series of mortgage pass-through certificates,
entitled Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1998-C2 (the "Certificates"), was issued pursuant to a
pooling and servicing agreement (the "Pooling Agreement") attached hereto as
Exhibit 4.1 and dated as of March 1, 1998, among Merrill Lynch Mortgage
Investors, Inc. as depositor (the "Registrant"), First Union National Bank as
master servicer, CRIIMI MAE Services Limited Partnership as special servicer,
and Norwest Bank Minnesota, National Association as trustee. The Certificates
consist of sixteen classes (each, a "Class") of Certificates, seven of which
Classes are designated as the "Class A-1 Certificates", the "Class A-2
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 nine of which
Classes are designated as the "Class F Certificates", the "Class G
Certificates", the "Class H Certificates", the "Class J Certificates", the
"Class K Certificates", the "Class L 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 401 multifamily and commercial mortgage loans
(the "Mortgage Loans") having an aggregate principal balance as of March 1, 1998
(the "Cut-off Date") of approximately $1,088,330,822. Each Mortgage Loan is
secured by a first mortgage lien on a fee simple estate in an income producing
property with the exception of four Mortgage Loans which are fully secured by a
leasehold estate in income-producing real property.
One hundred sixty (160) of the Mortgage Loans (the "MLMC Loans") having an
aggregate principal balance of approximately $631,231,877 (the "MLMC Balance"),
were acquired by the Registrant from Merrill Lynch Mortgage Capital Inc.
("MLMC"), 223 of the Mortgage Loans (the "DFC Loans") having an aggregate
principal balance of approximately $370,032,479 (the "DFC Balance"), were
acquired by the Registrant from Daiwa Finance Corp. ("DFC"), and 18 of the
Mortgage Loans (the "DREFC Loans"), having an aggregate principal balance of
approximately $87,066,466 (the "DREFC Balance"), were acquired by the Registrant
from Daiwa Real Estate Finance Corp. ("DREFC") pursuant to three Mortgage Loan
Purchase Agreements, each dated as of March 1, 1998 (collectively, the "Purchase
Agreements"), between the Registrant and MLMC, DFC or DREFC, as applicable. The
purchase prices (collectively the "Purchase Price") for the Mortgage Loans under
each Purchase Agreement consisted of a cash amount equal to (i) 100% of the
related Balance plus (ii) interest accrued on the related Mortgage Loans at the
related Mortgage Rate. 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, Fenner & Smith Incorporated ("MLPF&S") and Daiwa
Securities America Inc. ("Daiwa Securities") pursuant to an Underwriting
Agreement, dated as of March 24, 1998 (the "Underwriting Agreement"), among the
Registrant, MLPF&S and Daiwa Securities (pertaining to the Offered Certificates)
and a Certificate Purchase Agreement, dated as of March 27, 1998, among the
Registrant, MLPF&S and Daiwa Securities (pertaining to the Private
Certificates). The Registrant is a wholly-owned limited purpose finance
subsidiary of MLMC. On March 27, 1998, the Registrant transferred the Mortgage
Loans to the Trust Fund pursuant to the Pooling
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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:
<TABLE>
<CAPTION>
Initial Pass-Through
Class Initial Certificate Balance Rate
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<S> <C> <C>
A-1................................. $229,904,000 6.22%
A-2................................. $559,138,000 6.39%
B .................................. $ 32,650,000 (1)
C .................................. $ 59,859,000 (1)
D .................................. $ 70,742,000 (1)
E ................................. $ 16,325,000 (1)
IO ................................ (2) (3)
F ................................. $ 59,858,000 6.25%
G ................................. $ 5,442,000 6.25%
H ............................... $ 21,766,000 6.25%
J ............................... $ 5,442,000 6.25%
K ............................... $ 27,204,822 6.25%
L ............................... (4) (4)
R-I................................. N/A(5) N/A(5)
R-II................................ N/A(5) N/A(5)
R-III............................... N/A(5) N/A(5)
</TABLE>
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(1) The Pass-Through Rates applicable to the Class B, Class C, Class D and
Class E Certificates will equal the Weighted Average Net Mortgage Rate
minus 1.41%, 1.25%, 0.90% and 0.56%, respectively.
(2) The Class IO Certificates will not have a Certificate Balance nor will they
entitle the holders thereof to receive distributions of principal.
(3) Holders of the Class IO Certificates will be entitled to receive
distributions of interests in an amount equal to the aggregate interest
accrued on the notional amount of each of its Components.
(4) The Class L Certificates will not have a Certificate Balance nor will they
entitle the holders thereof to receive distributions of principal or
interest, other than certain amounts.
(5) The Class R-1, Class R-II and Class R-III Certificates have no Certificate
Balance and do not bear interest.
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The Offered Certificates and the Mortgage Loans are described in more
detail in the Prospectus, dated February 25, 1998, and the Prospectus
Supplement, dated March 24, 1998, 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 March 24, 1998, 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 March 1, 1998, among
Merrill Lynch Mortgage Investors, Inc. as depositor, First Union
National Bank as master servicer, CRIIMI MAE Services Limited
Partnership as special servicer, and Norwest Bank Minnesota,
National Association as trustee.
99.1 Mortgage Loan Purchase Agreement, dated as of March 1, 1998,
between Merrill Lynch Mortgage Investors, Inc. and Merrill Lynch
Mortgage Capital Inc.
99.2 Mortgage Loan Purchase Agreement, dated as of March 1, 1998,
between Merrill Lynch Mortgage Investors, Inc. and Daiwa Finance
Corp.
99.3 Mortgage Loan Purchase Agreement, dated as of March 1, 1998,
between Merrill Lynch Mortgage Investors, Inc. and Daiwa Real
Estate Finance Corp.
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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: April 10, 1998
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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 March 24, among Merrill Lynch Mortgage
Investors, Inc., Merrill Lynch, Pierce, Fenner & Smith and Daiwa Securities
America Inc.....................
4.1 Pooling and Servicing Agreement, dated as of March 1, 1998, among Merrill
Lynch Mortgage Investors, Inc. as depositor, First Union National Bank as
master servicer, CRIIMI MAE Services Limited Partnership as special
servicer, and Norwest Bank Minnesota, National Association as trustee......
99.1 Mortgage Loan Purchase Agreement, dated as of March 1, 1998, between
Merrill Lynch Mortgage Investors, Inc. and Merrill Lynch Mortgage Capital
Inc..................................
99.2 Mortgage Loan Purchase Agreement, dated as of March 1, 1998 between Merrill
Lynch Mortgage Investors, Inc. and Daiwa Finance Corp......................
99.3 Mortgage Loan Purchase Agreement, dated as of March 1, 1998 between Merrill
Lynch Mortgage Investors, Inc. and Daiwa Real Estate Finance Corp..........
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MERRILL LYNCH MORTGAGE INVESTORS, INC.
A DELAWARE CORPORATION
UNDERWRITING AGREEMENT
$968,618,000
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1998-C2
MARCH 24, 1998
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TABLE OF CONTENTS
Page
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1. Representations and Warranties.......................................... 2
(a) Representations and Warranties by the Company................... 2
(i) Compliance with Registration Requirements............... 2
(ii) Incorporated Documents.................................. 3
(iii) Independent Accountants................................. 3
(iv) Financial Information................................... 3
(v) No Material Adverse Change in Business.................. 3
(vi) Good Standing of the Company............................ 4
(vii) Authorization of Agreement.............................. 4
(viii) Authorization of Other Agreements....................... 4
(ix) Description of the Pooling and Servicing
Agreement............................................. 4
(x) Description of the Certificates......................... 4
(xi) Absence of Defaults and Conflicts....................... 4
(xii) Absence of Labor Dispute................................ 5
(xiii) Absence of Proceedings.................................. 5
(xiv) Accuracy of Exhibits.................................... 5
(xv) Possession of Intellectual Property..................... 6
(xvi) Absence of Further Requirements......................... 6
(xvii) Possession of Licenses and Permits...................... 6
(xvii) Tax Returns............................................. 6
(xviii) Compliance with Cuba Act................................ 6
(xx) Investment Company Act.................................. 7
(xxi) Environmental Laws...................................... 7
(xxii) No Liens................................................ 7
(xxiii) Sale of Mortgage Loans.................................. 8
(xxiv) Ratings................................................. 8
(xxv) Taxes................................................... 8
(b) Officer's Certificates.......................................... 8
2. Sale and Delivery to the Underwriters; Closing.......................... 8
(a) Certificates.................................................... 8
(b) Payment......................................................... 8
(c) Denominations; Registration..................................... 9
3. Covenants of the Company................................................ 9
(a) Compliance with Securities Regulations and Commission
Requests...................................................... 9
(b) Filing of Amendments............................................ 9
(c) Delivery of Registration Statements............................. 9
(d) Delivery of Prospectuses........................................ 10
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(e) Continued Compliance with Securities Laws....................... 10
(f) Blue Sky Qualifications......................................... 10
(g) Reporting Requirements.......................................... 11
(h) Rating of Certificates.......................................... 11
(i) DTC............................................................. 11
(j) Restriction on Sale of Securities............................... 11
4. Payment of Expenses..................................................... 11
(a) Expenses........................................................ 11
(b) Termination of Agreement........................................ 11
5. Conditions of Underwriters' or Obligations.............................. 12
(a) Effectiveness of Registration Statement......................... 12
(b) Opinion of Counsel for the Master Servicer...................... 12
(c) Opinion of Counsel for the Special Servicer..................... 12
(d) Opinion of Counsel for the Underwriters......................... 12
(e) Officers' Certificate of the Company............................ 12
(f) Officers' Certificates of the Master Servicer................... 12
(g) Officers' Certificate of the Special Servicer................... 13
(h) Accountant's Comfort Letter..................................... 13
(i) Bring-down Comfort Letter....................................... 13
(j) Maintenance of Rating........................................... 13
(k) Opinion of Counsel for Trustee.................................. 13
(l) Opinion of Tax and ERISA Counsel................................ 13
(m) Opinion of Counsel for the Company.............................. 14
(n) Additional Documents............................................ 14
(o) Termination of Agreement........................................ 14
6. Indemnification......................................................... 14
(a) Indemnification of Underwriter.................................. 14
(b) Indemnification of the Company, Directors and Officers.......... 15
7. Contribution............................................................ 17
8. Representations, Warranties and Agreements to Survive Delivery.......... 18
9. Termination of Agreement................................................ 18
(a) Termination; General............................................ 18
(b) Liabilities..................................................... 19
10. Notices................................................................. 19
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11. Parties................................................................. 19
12. GOVERNING LAW AND TIME.................................................. 19
13. Effect of Headings...................................................... 19
14. Miscellaneous........................................................... 19
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<PAGE>
$968,618,000
MERRILL LYNCH MORTGAGE INVESTORS, INC.
(a Delaware corporation)
Mortgage Pass-Through Certificates, Series 1998-C2
UNDERWRITING AGREEMENT
March 24, 1998
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
DAIWA SECURITIES AMERICA INC.
Financial Square, 32 Old Slip
New York, NY 10005-3538
Ladies and Gentlemen:
Merrill Lynch Mortgage Investors, Inc., a Delaware corporation (the
"Company") confirms its agreement with Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("Merrill Lynch") and Daiwa Securities America Inc. ("Daiwa"; Daiwa
and Merrill Lynch, each an "Underwriter" and, together, the "Underwriters"),
with respect to the issue and sale by the Company and the purchase by each
Underwriter of the initial certificate balance set forth in Schedule A hereto of
$968,618,000 aggregate initial certificate balance of the Company's Mortgage
Pass-Through Certificates, Series 1998-C2 (the "Certificates"). 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 Daiwa Real Estate Finance Corp. (collectively, the "Mortgage Loan
Sellers"). The Certificates are to be issued pursuant to a pooling and servicing
agreement, dated as of March 1, 1998 (the "Pooling and Servicing Agreement"),
among the Company as depositor, Norwest Bank Minnesota, National Association as
trustee (the "Trustee"), First Union National Bank as master servicer (the
"Master Servicer") and CRIIMI MAE Services Limited Partnership as special
servicer (the "Special Servicer"). Certificates issued in book-entry form will
be issued to Cede & Co. as nominee of The Depository Trust Company ("DTC")
pursuant to a letter agreement, to be dated as of the Closing Time (as defined
in Section 2(b)) (the "DTC Agreement"), among the Trust Fund, the Trustee and
DTC.
<PAGE>
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (File No. 333-38073) relating
to the Certificates, and the offering thereof from time to time in accordance
with Rule 415 under the Securities Act of 1933, as amended (the "1933 Act"), and
has filed, and proposes to file, such amendments thereto as may have been
required to the date hereof and as shall be required to the effective date
thereof pursuant to the 1933 Act and the rules of the Commission thereunder (the
"1933 Act Regulations"). Such registration statement, as amended at the time
when each becomes effective under the 1933 Act and at the Closing Time defined
below, is referred to herein as the "Registration Statement". The Company
proposes to file with the Commission pursuant to Rule 424(b)(5) under the 1933
Regulations a supplement (the "Prospectus Supplement") to the form of prospectus
(as may be amended in connection with such Prospectus Supplement, the "Basic
Prospectus"; the Basic Prospectus, together with the Prospectus Supplement, the
"Prospectus"). Any preliminary form of the Prospectus that has heretofore been
filed pursuant to Rule 424(b) or prior to the effective date of the Registration
Statement, pursuant to Rule 402(a) or 424(a) is hereinafter called a
"preliminary prospectus".
For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the Prospectus or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering Analysis and
Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which are incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934, as amended (the "1934
Act") which is incorporated by reference in the Registration Statement, such
preliminary prospectus or the Prospectus, as the case may be.
Capitalized terms used but not defined herein shall have the meanings given
to them in the Pooling and Servicing Agreement.
1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to each Underwriter as of the date hereof, and as of the Closing
Time referred to in Section 2(b) hereof, and agrees with each Underwriter as
follows:
(i) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-3 under the 1933 Act. The Registration
Statement has become effective under the 1933 Act and 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 are pending or, to the knowledge of the Company, are
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contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with. At the time
the Registration Statement became effective and at the Closing Time, the
Registration Statement and any amendments and supplements thereto complied
and will comply in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations and the Trust Indenture Act of 1939, as
amended (the "1939 Act") and the rules and regulations of the Commission
thereunder (the "1939 Act Regulations"), and did not and will not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. Neither the Prospectus nor any amendments or supplements
thereto, at the time the Prospectus or any such amendment or supplement was
issued and at the Closing Time, included or will include an untrue
statement of a material fact or omitted or will omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or Prospectus
made in reliance upon and in conformity with information furnished to the
Company in writing by the Underwriters expressly for use in the
Registration Statement or Prospectus.
The Prospectus filed as part of the Registration Statement as
originally filed or as part of any amendment thereto, or filed pursuant to
Rule 424 under the 1933 Act, complied when so filed in all material
respects with the 1933 Act Regulations and the Prospectus delivered to each
Underwriter for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to
be incorporated by reference in the Registration Statement and the
Prospectus, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read together
with the other information in the Prospectus, at the time the Registration
Statement became effective, at the time the Prospectus was issued and at
the Closing Time, did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
(iii) Independent Accountants. The accountants who certified the
financial information included in the Registration Statement are
independent certified public accountants as required by the 1933 Act and
the 1933 Act Regulations.
(iv) Financial Information. The financial information included in the
Registration Statement and the Prospectus present fairly the financial
position of the Company.
(v) No Material Adverse Change in Business. Since the respective dates
as of which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the
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financial condition, earnings, business affairs or business prospects of
the Company (a "Material Adverse Effect"), whether or not arising in the
ordinary course of business and (B) there have been no transactions entered
into by the Company, other than those in the ordinary course of business,
which are material with respect to the Company.
(vi) Good Standing of the Company. The Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform its
obligations under this Agreement; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in each
other jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect.
(vii) Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
(viii) Authorization of Other Agreements. Each of the Pooling and
Servicing Agreement, the Mortgage Loan Purchase Agreements and this
Agreement has been duly authorized and, at the Closing Time, will have been
duly executed and delivered by the Company and will each constitute a
legal, valid and binding instrument enforceable against the Company in
accordance with its terms, subject (i) to applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting
creditors' rights generally, (ii) as to enforceability, to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law) and (iii) as to enforceability with respect
to rights of indemnity thereunder, to limitations of public policy under
applicable securities laws.
(ix) Description of the Pooling and Servicing Agreement. The
description of the Pooling and Servicing Agreement in the Prospectus
conforms in all material respects with the terms thereof. At the Closing
Time, the Pooling and Servicing Agreement will conform in all material
respects to the description thereof contained in the Prospectus.
(x) Description of the Certificates. At the Closing Time, the
Certificates will have been duly and validly authorized and executed by the
Trustee, and, assuming authentication as specified in the Pooling and
Servicing Agreement, will be validly issued and outstanding and entitled to
the benefits of the Pooling and Servicing Agreement. The description of the
Certificates in the Prospectus conforms or will conform in all material
respects with the terms thereof and will be in substantially the respective
forms filed or incorporated by reference, as the case may be, as exhibits
to the Registration Statement.
(xi) Absence of Defaults and Conflicts. The Company is not in
violation of its charter or by-laws or in default in the performance or
observance of any
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obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease
or other agreement or instrument to which the Company is a party or by
which it or any of them may be bound, or to which any of the property or
assets of the Company is subject (collectively, "Agreements and
Instruments") except for such defaults that would not result in a Material
Adverse Effect; and the execution, delivery and performance of this
Agreement and any other agreement or instrument entered into or issued or
to be entered into or issued by the Company in connection with the
transactions contemplated hereby or thereby or in the Registration
Statement and the consummation of the transactions contemplated herein and
in the Registration Statement (including the issuance and sale of the
Certificates) and compliance by the Company with its obligations hereunder
have been duly authorized by all necessary corporate action and do not and
will not, whether with or without the giving of notice or passage of time
or both, conflict with or constitute a breach of, or default or a Repayment
Event (as defined below) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Company
pursuant to, the Agreements and Instruments except for such conflicts,
breaches or defaults or liens, charges or encumbrances that, singly or in
the aggregate, would not result in a Material Adverse Effect, nor will such
action result in any violation of the provisions of the charter or by-laws
of the Company or any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any of
its assets or properties. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf) the
right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by the Company or its affiliates.
(xii) Absence of Labor Dispute. No labor dispute with the employees of
the Company exists or, to the knowledge of the Company, is imminent.
(xiii) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the Company
threatened, against or affecting the Company which would reasonably be
expected to result in a Material Adverse Effect, or which would reasonably
be expected to materially and adversely affect the properties or assets of
the Company or the consummation of this Agreement or the performance by the
Company or its obligations hereunder. The aggregate of all pending legal or
governmental proceedings to which the Company is a party or of which any of
its property or assets is the subject which are not described in the
Registration Statement, including ordinary routine litigation incidental to
the business, would not reasonably be expected to result in a Material
Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or documents which
are required to be described in the Registration Statement, the Prospectus
or the documents incorporated by reference therein or to be filed as
exhibits thereto which have not been so described and filed as required.
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<PAGE>
(xv) Possession of Intellectual Property. The Company owns or
possesses, or can acquire on reasonable terms, adequate patents, patent
rights, licenses, inventions, copyrights, know-how (including trade secrets
and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks, trade names
or other intellectual property (collectively, "Intellectual Property")
necessary to carry on the business now operated by it, and the Company has
not received any notice or is not otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company and which infringement or conflict (if the subject of any
unfavorable decision, ruling or finding) or invalidity or inadequacy,
singly or in the aggregate, would result in a Material Adverse Effect.
(xvi) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale of
the Certificates hereunder or the consummation of the transactions
contemplated by this Agreement, except such as may be required under the
1933 Act Regulations, the 1939 Act Regulations or state securities or blue
sky laws.
(xvii) Possession of Licenses and Permits. The Company possesses such
permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate federal,
state, local or foreign regulatory agencies or bodies necessary to conduct
the business now operated by them; the Company is in compliance with the
terms and conditions of all such Governmental Licenses, except where the
failure so to comply would not, singly or in the aggregate, have a Material
Adverse Effect; all of the Governmental Licenses are valid and in full
force and effect, except when the invalidity of such Governmental Licenses
or the failure of such Governmental Licenses to be in full force and effect
would not have a Material Adverse Effect; and the Company has not received
any notice of proceedings relating to the revocation or modification of any
such Governmental Licenses which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
(xvii) Tax Returns. The Company has filed all federal, state, local
and foreign tax returns that are required to be filed or has duly requested
extensions thereof and has paid all taxes required to be paid by it and any
related assessments, fines or penalties, except for any such tax,
assessment, fine or penalty that is being contested in good faith and by
appropriate proceedings; and adequate charges, accruals and reserves have
been provided for in respect of all federal, state, local and foreign taxes
for all periods as to which the tax liability of the Company has not been
finally determined or remains open to examination by applicable taxing
authorities.
(xviii) Compliance with Cuba Act. The Company has complied with, and
is and will be in compliance with, the provisions of that certain Florida
act relating to
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disclosure of doing business with Cuba, codified as Section 517.075 of the
Florida statutes, and the rules and regulations thereunder (collectively,
the "Cuba Act") or is exempt therefrom.
(xx) Investment Company Act. The Company is not and upon the issuance
and sale of the Certificates as herein contemplated and the application of
the net proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended
(the "1940 Act"). The Trust Fund is not required to be registered as an
"investment company" under the 1940 Act.
(xxi) Environmental Laws. Except as described in the Registration
Statement and except such matters as would not, singly or in the aggregate,
result in a Material Adverse Effect, (A) the Company is not in violation of
any federal, state, local or foreign statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or
administrative order, consent, decree or judgment, relating to pollution or
protection of human health, the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata)
or wildlife, including, without limitation, laws and regulations relating
to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum or
petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company has all permits, authorizations and approvals
required under any applicable Environmental Laws and is in compliance with
its requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company and (D) there are no
events or circumstances that would reasonably be expected to form the basis
of an order for clean-up or remediation, or an action, suit or proceeding
by any private party or governmental body or agency, against or affecting
the Company relating to Hazardous Materials or Environmental Laws.
(xxii) No Liens. 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 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.
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(xxiii) Sale of Mortgage Loans. 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.
(xxiv) Ratings. At the Closing Time, the respective classes of
Certificates shall have been assigned ratings no lower than those set forth
in Schedule A hereto by the nationally recognized statistical rating
organizations identified in Schedule A hereto (the "Rating Agencies").
(xxv) Taxes. Any taxes, fees and other governmental charges in
connection with the execution, delivery and issuance of this Agreement, the
Pooling and Servicing Agreement, the Mortgage Loan Purchase Agreements and
the Certificates payable by the Company (other than income taxes) have been
paid or will be paid at or prior to the Closing Time.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company delivered to the Underwriters or to counsel for the Underwriters shall
be deemed a representation and warranty by the Company to the Underwriters to
the matters covered thereby.
2. Sale and Delivery to the Underwriters; Closing.
(a) Certificates. On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees to purchase from
the Company, at the purchase price set forth in Schedule A, the aggregate
initial certificate balance of Certificates set forth in Schedule A opposite the
name of such Underwriter.
(b) Payment. Payment of the purchase price for, and delivery of
certificates for, 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, at 10:00 A.M. on or about March 27, 1998 or such other time not later
than ten business days after such date as shall be agreed upon by the
Underwriters and the Company (such time and date of payment and delivery being
herein called the "Closing Time").
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
each Underwriter for the account of such Underwriter of certificates for the
Certificates to be purchased by them. The
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certificates representing the Certificates shall be registered in the name of
Cede & Co., pursuant to the DTC Agreement and shall be made available for
examination and packaging by the Underwriters in the City of New York not later
than 10:00 A.M. on the last business day prior to the Closing Time.
(c) Denominations; Registration. Certificates for the Certificates shall be
in such denominations and registered in such names as the Underwriters may
request in writing at least one full business day before the Closing Time.
3. Covenants of the Company. The Company covenants with each Underwriter as
follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company will notify each Underwriter immediately, and confirm the notice in
writing, (i) when any post-effective amendment to the Registration Statement
shall become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments from the
Commission, (iii) of any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the Prospectus or for
additional information, and (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or of any order
preventing or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Certificates for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Company will promptly effect the filings necessary pursuant
to Rule 424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under Rule 424(b)
was received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any such order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give each Underwriter notice of
its intention to file or prepare any amendment to the Registration Statement or
any amendment, supplement or revision to either the Basic Prospectus or to the
Prospectus, whether pursuant to the 1933 Act, the 1934 Act or otherwise (other
than reports to be filed pursuant to the 1934 Act), will furnish each
Underwriter with copies of any such documents a reasonable amount of time prior
to such proposed filing or use, as the case may be, and will not file or use any
such document to which either Underwriter or counsel for the Underwriters shall
object.
(c) Delivery of Registration Statements. The Company has furnished or will
deliver to each Underwriter and counsel for the Underwriters, without charge,
signed copies of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to each Underwriter without charge, a conformed
copy of the Registration Statement as originally filed and of each amendment
thereto (without exhibits) for each of the Underwriters. The copies of the
Registration Statement and each amendment thereto furnished to
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each Underwriter will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus, if
any, as each such Underwriter reasonably requested, and the Company hereby
consents to the use of such copies for purposes permitted by the 1933 Act. The
Company will furnish to each Underwriter, without charge, during the period when
the Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
such number of copies of the Prospectus (as amended or supplemented) as each
such Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to each Underwriter will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply with
the 1933 Act and the 1933 Act Regulations, the 1934 Act and the 1934 Act
Regulations and the 1939 Act and the 1939 Act Regulations so as to permit the
completion of the distribution of the Certificates as contemplated in this
Agreement and in the Prospectus. If at any time when a prospectus is required by
the 1933 Act to be delivered in connection with sales of the Certificates, any
event shall occur or condition shall exist as a result of which it is necessary,
in the opinion of counsel for the Underwriters or for the Company, to amend the
Registration Statement or amend or supplement the Prospectus in order that the
Prospectus will not include any untrue statements of a material fact or omit to
state a material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend or
supplement the Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Company will promptly prepare and file with
the Commission, subject to Section 3(b), such amendment or supplement as may be
necessary to correct such statement or omission or to make the Registration
Statement or the Prospectus comply with such requirements, and the Company will
furnish to each Underwriter such number of copies of such amendment or
supplement as each such Underwriter may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with each Underwriter, to qualify the Certificates for offering and
sale under the applicable securities laws of such states and other jurisdictions
as each such Underwriter may designate and to maintain such qualifications in
effect for a period of not less than one year from the later of the effective
date of the Registration Statement; provided, however, that the Company shall
not be obligated to file any general consent to service of process or to qualify
as a foreign corporation or as a dealer in securities in any jurisdiction in
which it is not so qualified or to subject itself to taxation in respect of
doing business in any jurisdiction in which it is not otherwise so subject. In
each jurisdiction in which the Certificates have been so qualified, the Company
will file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement. The Company
will also supply each Underwriter with such information
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as is necessary for the determination of the legality of the Certificates for
investment under the laws of such jurisdictions as each such Underwriter may
request.
(g) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(h) Rating of Certificates. The Company shall take all reasonable action
necessary to enable Standard & Poor's Ratings Service, a division of McGraw
Hill, Inc. ("S&P"), and Moody's Investors Service, Inc. ("Moody's") to provide
their respective credit ratings of the Certificates as described in the
Prospectus.
(i) DTC. The Company will cooperate with each Underwriter and use its best
efforts to permit the Certificates to be eligible for clearance and settlement
through the facilities of DTC.
(j) Restriction on Sale of Securities. During the period from the date
hereof to the Closing Time, the Company will not, without the prior written
consent of the Underwriters, directly or indirectly, issue, sell, offer or agree
to sell, grant any option for the sale of, or otherwise dispose of, any other
mortgage-related securities of the Company or securities of the Company that are
convertible into, or exchangeable for, the Certificates or such other
securities.
4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the performance
of its obligations under this Agreement, including (i) the preparation, printing
and any filing of the Registration Statement (including any schedules or
exhibits and any document incorporated therein by reference) originally filed
and of each amendment or supplement thereto, (ii) the preparation, printing and
delivery to each Underwriter of this Agreement, the Pooling and Servicing
Agreement and such other documents as may be required in connection with the
offering, purchase, sale and delivery of the Certificates, (iii) the
preparation, issuance and delivery of the certificates for the Certificates to
each Underwriter, including any charges of DTC in connection therewith, (iv) the
fees and disbursements of the Company's accountants and other advisors, (v) the
qualification of the Certificates under securities laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Survey and any supplement
thereto, (vi) the printing and delivery to each Underwriter of copies of each
preliminary prospectus and of the Prospectus and any amendments or supplements
thereto, (vii) the fees and expenses of the Trustee, the Master Servicer and the
Special Servicer, including the fees and disbursements of counsel for the
Trustee, the Master Servicer and the Special Servicer in connection with the
Pooling and Servicing Agreement and the Certificates and (viii) any fees payable
in connection with the rating of the Certificates.
(b) Termination of Agreement. If this Agreement is terminated by either
Underwriter in accordance with the provisions of Section 5 or Section 9(a)(i)
hereof, the
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Company shall reimburse such Underwriter for all of its out-of-pocket expenses,
including the reasonable fees and disbursements of counsel for such Underwriter.
5. Conditions of Underwriters' Obligations. The obligations of each
Underwriter hereunder are subject to the accuracy of the representations and
warranties of the Company contained in Section 1 hereof or in certificates of
any officer of the Company delivered pursuant to the provisions hereof, to the
performance by the Company of its covenants and other obligations hereunder, and
to the following further conditions:
(a) Effectiveness of Registration Statement. At the Closing Time no stop
order suspending the effectiveness of the Registration Statement shall have been
issued under the 1933 Act or proceedings therefor initiated or threatened by the
Commission, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of
counsel to the Underwriters.
(b) Opinion of Counsel for the Master Servicer. At the Closing Time, each
Underwriter shall have received the favorable opinion, dated as of the Closing
Time, of counsel for the Master Servicer, in form and substance satisfactory to
counsel for the Underwriters.
(c) Opinion of Counsel for the Special Servicer. At the Closing Time, each
Underwriter shall have received the favorable opinion, dated as of the Closing
Time, of counsel for the Special Servicer, in form and substance satisfactory to
counsel for the Underwriters.
(d) Opinion of Counsel for the Underwriters. At the Closing Time, each
Underwriter shall have received the favorable opinions, dated as of the Closing
Time, of counsel for the Underwriters. Such counsel may also state that, insofar
as such opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Underwriters and certificates
of public officials.
(e) Officers' Certificate of the Company. At the Closing Time, there shall
not have been, since the date hereof or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
financial condition, earnings, business affairs or business prospects of the
Company, whether or not arising in the ordinary course of business, and each
Underwriter shall have received a certificate of the President or a Vice
President of the Company dated as of the Closing Time, to the effect that (i)
there has been no such material adverse change, (ii) the representations and
warranties in Section 1(a) hereof are true and correct with the same force and
effect as though expressly made at and as of the Closing Time, (iii) each has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are pending or are
contemplated by the Commission.
(f) Officers' Certificates of the Master Servicer. At the Closing Time,
there shall not have been, since the date hereof or since the respective dates
as of which information is given in the Prospectus, any material adverse change
in the financial condition, earnings, business affairs or business prospects of
the Master Servicer and its subsidiaries considered as one
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enterprise, whether or not arising in the ordinary course of business, and each
Underwriter shall have received a certificate of the President or a Vice
President of the Master Servicer, dated as of the Closing Time, to that effect.
(g) Officers' Certificate of the Special Servicer. At the Closing Time,
there shall not have been, since the date hereof or since the respective dates
as of which information is given in the Prospectus, any material adverse change
in the financial condition, earnings, business affairs or business prospects of
the Special Servicer and its subsidiaries considered as one enterprise, whether
or not arising in the ordinary course of business, and each Underwriter shall
have received a certificate of the President or a Vice President of the Special
Servicer, dated as of the Closing Time, to that effect.
(h) Accountant's Comfort Letter. At or prior to the time of the execution
of this Agreement, each Underwriter shall have received from Deloitte & Touche
LLP ("Deloitte") a letter dated such date, in form and substance satisfactory to
each Underwriter, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to each Underwriter with respect to
certain financial information contained in the Registration Statement and the
Prospectus.
(i) Bring-down Comfort Letter. At the Closing Time, each Underwriter shall
have received from Deloitte a letter, dated as of the Closing Time, to the
effect that they reaffirm the statements made in the letter furnished pursuant
to subsection (h) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to the Closing Time.
(j) Maintenance of Rating. At the Closing Time, the Certificates shall have
received the ratings set forth in Schedule A and the Company shall have
delivered to each Underwriter a letter dated the Closing Time, from each such
rating agency, or other evidence satisfactory to each Underwriter, confirming
that the Certificates have such ratings.
(k) Opinion of Counsel for Trustee. At the Closing Time, each Underwriter
shall have received the favorable opinion, dated as of the Closing Time, of
counsel for the Trustee, in form and substance satisfactory to counsel for the
Underwriters.
(l) Opinion of Tax and ERISA Counsel. At the Closing Time, each Underwriter
shall have received a favorable opinion, dated as of the Closing Time, 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 860G 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 "Material 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.
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<PAGE>
(m) Opinion of Counsel for the Company. At the Closing Time, each
Underwriter shall have received the favorable opinion, dated as of the Closing
Time, of counsel for the Company, in form and substance satisfactory to counsel
for the Underwriters.
(n) Additional Documents. At the Closing Time, counsel for the Underwriters
shall have been furnished with such documents and opinions as they may require
for the purpose of enabling them to pass upon the issuance and sale of the
Certificates as herein contemplated, 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 each Underwriter and counsel for
the Underwriters.
(o) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement may be terminated by either Underwriter by notice to the Company at
any time at or prior to the Closing Time, and such termination shall be without
liability of any party to any other party except as provided in Section 4 and
except that Sections 1, 6, 7 and 8 shall survive any such termination and remain
in full force and effect.
6. Indemnification.
(a) Indemnification of Underwriters. The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls such
Underwriter, as the case may be, within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or
the omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Computational
Materials, ABS Term Sheets or Collateral Term Sheets distributed by such
Underwriter, unless such untrue statement or alleged untrue statement of a
material fact was made in reliance upon and in conformity with Derived
Information provided by such Underwriter to the Company expressly for use
in the Registration Statement, the Prospectus, the Computational Materials,
ABS Term Sheets or Collateral Term Sheets and the untrue statement or
alleged untrue statement did not derive from an inaccuracy in the
Seller-Provided Information used in the preparation of such Computational
Materials, ABS Term Sheets or Collateral Term Sheets;
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(iii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company; and
(iv) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by such Underwriter),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i), (ii)
or (iii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by such
Underwriter expressly for use in the Registration Statement (or any amendment
thereto), or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(b) Indemnification of the Company, Directors and Officers. Each
Underwriter agrees to indemnify and hold harmless the Company and each person,
if any, who controls the Company within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act as follows (i) against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto) in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter expressly for use in the Registration Statement (or amendment
thereto) or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), and (ii) against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or alleged
untrue statements made in the Computational Materials, Collateral Term Sheets or
ABS Term Sheets to the extent that such untrue statement or alleged untrue
statement of a material fact was made in reliance upon and in conformity with
Derived Information provided by such Underwriter expressly for use in the
Computational Materials, the ABS Term Sheets or the Collateral Term Sheets and
the untrue statements or alleged untrue statements did not derive from an
inaccuracy in the Seller-Provided Information used in the preparation of such
Computational Materials, ABS Term Sheets or Collateral Term Sheets.
For purposes of this Agreement, "Computational Materials" shall have the
meaning given such term in the No-Action Letter of May 20, 1994 issued by the
Commission to Kidder, Peabody
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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 of February 20, 1995
issued by the Commission to the Public Securities Association (the "PSA Letter"
and, together with the Kidder/PSA Letter, the "No-Action Letters"), but shall
include only those Computational Materials that have been prepared or delivered
to prospective investors by such Underwriter. For purposes hereof, "ABS 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 or Collateral Term
Sheets that have been prepared or delivered to prospective investors by such
Underwriter. For purposes hereof, "Derived Information" means such portion, if
any, of the information delivered to the Company by such Underwriter for filing
with the Commission on Form 8-K and (i) is not contained in the Prospectus
without taking into account information incorporated therein by reference, and
(ii) does not constitute Seller-Provided Information. "Seller-Provided
Information" means any computer tape (or other information) furnished to such
Underwriter by or on behalf of the Company, including, but not limited to, any
information provided by any Mortgage Loan Seller expressly for use in the
Registration Statement (or any amendment thereto), or any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) Actions against Parties; Notification. 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 hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by the Underwriters and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. 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. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party
-16-
<PAGE>
for fees and expenses of counsel, such indemnifying party agrees that it shall
be liable for any settlement of the nature contemplated by Section 6(a)(iii)
effected without its written consent if (i) such settlement is entered into more
that 45 days after receipt by such indemnifying party of the aforesaid request,
(ii) such indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
7. Contribution. If the indemnification provided for in Section 6 hereof is
for any reason unavailable to or insufficient to hold harmless an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and such Underwriter on the other hand from the offering of the
Certificates pursuant to this Agreement or (ii) if the allocation provided by
clause (i) 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 such
Underwriter on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and such
Underwriter on the other hand in connection with the offering of the
Certificates pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Certificates pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by such Underwriter, in
each case as set forth on the cover of the Prospectus, bear to the aggregate
initial public offering price of the Certificates as set forth on such cover.
The relative fault of the Company on the one hand and such Underwriter on the
other hand shall be determined by reference to, among other things, whether any
such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company, or by such Underwriter and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and each Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, each Underwriter shall
not be required to contribute any amount in excess of the amount by which the
total price at which the
-17-
<PAGE>
Certificates underwritten by such Underwriter and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (with the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls each
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter and
each person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company. Each Underwriter's obligations to contribute
pursuant to this Section 7 is in proportion to the initial certificate balance
of Certificates set forth opposite its name in Schedule A hereto.
8. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company submitted pursuant hereto, shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of each Underwriter or controlling person, or by or on behalf of
the Company, and shall survive delivery of the Certificates to each Underwriter.
9. Termination of Agreement.
(a) Termination; General. Either Underwriter may terminate this Agreement,
by notice to the Company, at any time at or prior to the Closing Time (i) if
there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the financial condition, earnings, business affairs
or business prospects of the Company or any of the Mortgage Loan Sellers,
whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States, any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change or development involving a prospective change in national
or international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of such Underwriter,
impracticable to market the Certificates or to enforce contracts for the sale of
the Certificates, or (iii) if trading in any securities of the Company or any of
the Mortgage Loan Sellers has been suspended or limited by the Commission or the
New York Stock Exchange, or if trading generally on the American Stock Exchange
or the New York Stock Exchange or in the NASDAQ National Market System has been
suspended or limited, or minimum or maximum prices for trading have been fixed,
or maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental authority, or (iv) if a
banking moratorium has been declared by either Federal or New York authorities.
-18-
<PAGE>
(b) Liabilities. If this Agreement is terminated pursuant to the Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
10. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. 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 10281-1315, 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.
11. Parties. This Agreement shall each inure to the benefit of and be
binding upon each Underwriter, 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 each Underwriter,
the Company and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their 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 each Underwriter, the Company and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Certificates from any Underwriter shall be deemed
to be a successor by reason merely of such purchase.
12. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
13. Effect of Headings. The Article and Section headings herein and the
Table of Contents are for convenience only and shall not affect the construction
hereof.
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.
-19-
<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/ MICHAEL M. McGOVERN
-----------------------------------------------
Name: Michael M. McGovern
Title: Authorized Signatory
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ ROBERT FITZPATRICK
--------------------------------------
Name: Robert Fitzpatrick
Title: Authorized Signatory
DAIWA SECURITIES AMERICA INC.
By: /s/ HIROKI NOMURA
--------------------------------------
Name: Hiroki Nomura
Title: Executive Vice President
-20-
<PAGE>
SCHEDULE A
UNDERWRITING AGREEMENT, DATED MARCH 24, 1998
CUT-OFF DATE: March 1, 1998
CERTIFICATES: Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1998-C2
<TABLE>
<CAPTION>
Percent of Percent of
Initial Initial
Certificate Certificate
Initial Balance to be Balance to be
Class Certificate Purchased by Purchased by Initial Pass- Purchase
Designation Balance of Class Merrill Lynch Daiwa Through Rate Price(1) Rating(2)
----------- ---------------- ------------- ------------- ------------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
A-1 $229,904,000 58% 42% 6.22% 100.500000% Aaa/AAA
A-2 $559,138,000 58% 42% 6.39% 100.718750% Aaa/AAA
B $ 32,650,000 58% 42% (3) 100.734375% Aa2/AA
C $ 59,859,000 58% 42% (3) 100.687500% A2/A
D $ 70,742,000 58% 42% (3) 100.734375% Baa2/BBB
E $ 16,325,000 58% 42% (3) 100.718750% Baa3/BBB-
IO (4) 58% 42% (4) 9.128593% Aaa/AAAr
</TABLE>
- ----------
(1) Expressed as a percentage of the initial aggregate Certificate Balance 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 amount thereof to be
purchased from the Cut-Off Date to but not including the Closing Date.
(2) By each of Moody's Investors Service, Inc. and Standard & Poor's Rating
Services, respectively.
(3) The Pass-Through Rates applicable to the Class B, Class C, Class D and
Class E Certificates will equal the Weighted Average Net Mortgage Rate
minus 1.41%, 1.25%, 0.90% and 0.56%, respectively.
(4) The Class IO Certificates will not have a principal balance nor will they
entitle the holders thereof to receive distributions of principal, but will
entitle such holders to receive payments of interest equal to the aggregate
of the interest accrued on the notional amount of each of its Components.
The initial notional amount is $1,088,330,822.
================================================================================
MERRILL LYNCH MORTGAGE INVESTORS, INC.
Depositor
and
FIRST UNION NATIONAL BANK
Master Servicer
and
CRIIMI MAE SERVICES LIMITED PARTNERSHIP
Special Servicer
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of March 1, 1998
Mortgage Pass-Through Certificates
Series 1998-C2
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I DEFINITIONS
SECTION 1.01. Defined Terms............................................... 2
Accrued Certificate Interest.......................................... 2
Accrued Component Interest............................................ 3
Acquisition Date...................................................... 3
Additional Interest................................................... 3
Additional Interest Distribution Account.............................. 3
Additional Interest Rate.............................................. 3
Additional Trust Fund Expense......................................... 3
Advance............................................................... 4
Adverse REMIC Event................................................... 4
Affiliate............................................................. 4
Agreement............................................................. 4
Anticipated Repayment Date............................................ 4
Appraisal............................................................. 4
Appraisal Reduction Amount............................................ 4
Appraised Value....................................................... 5
ARD Mortgage Loans.................................................... 5
Assignment of Leases.................................................. 5
Assumed Scheduled Payment............................................. 5
Authenticating Agent.................................................. 5
Available Distribution Amount......................................... 5
Balloon Mortgage Loan................................................. 6
Balloon Payment....................................................... 6
Bankruptcy Code....................................................... 6
Book-Entry Certificate................................................ 6
Breach................................................................ 6
Business Day.......................................................... 6
CERCLA................................................................ 6
Certificate........................................................... 6
Certificate Account................................................... 6
Certificate Factor.................................................... 7
Certificate Notional Amount........................................... 7
Certificate Owner..................................................... 7
Certificate Principal Balance......................................... 7
Certificate Register.................................................. 7
Certificate Registrar................................................. 7
Certificateholder..................................................... 7
Class................................................................. 8
i
<PAGE>
Page
----
Class A-1 Certificate................................................. 8
Class A-2 Certificate................................................. 8
Class B Certificate................................................... 8
Class C Certificate................................................... 8
Class D Certificate................................................... 8
Class E Certificate................................................... 8
Class F Certificate................................................... 8
Class G Certificate................................................... 8
Class H Certificate................................................... 8
Class IO Certificate.................................................. 9
Class J Certificate................................................... 9
Class K Certificate................................................... 9
Class L Certificate................................................... 9
Class Prepayment Percentage........................................... 9
Class Principal Balance............................................... 9
Class R-I Certificate................................................. 9
Class R-II Certificate................................................ 9
Class R-III Certificate............................................... 10
Closing Date.......................................................... 10
Code.................................................................. 10
Collection Period..................................................... 10
Comparative Financial Status Report................................... 10
Component............................................................. 10
Component Notional Amount............................................. 10
Controlling Class..................................................... 10
Corporate Trust Office................................................ 11
Corrected Mortgage Loan............................................... 11
CSSA Loan File Report................................................. 11
CSSA Property File Report............................................. 11
Custodian............................................................. 11
Cut-off Date.......................................................... 11
Cut-off Date Balance.................................................. 11
Debt Service Coverage Ratio........................................... 11
Defaulted Mortgage Loan............................................... 11
Defeasance Collateral................................................. 12
Defeasance Loan....................................................... 12
Definitive Certificate................................................ 12
Delinquent Loan Status Report......................................... 12
Depositor............................................................. 12
Depository............................................................ 12
Depository Participant................................................ 12
Determination Date.................................................... 12
Directly Operate...................................................... 12
Disqualified Organization............................................. 13
Distributable Certificate Interest.................................... 13
ii
<PAGE>
Page
----
Distribution Account.................................................. 13
Distribution Date..................................................... 13
Distribution Date Statement........................................... 13
Document Defect....................................................... 13
Due Date.............................................................. 14
Eligible Account...................................................... 14
Environmental Assessment.............................................. 14
ERISA................................................................. 14
Escrow Payment........................................................ 14
Event of Default...................................................... 14
Exchange Act.......................................................... 14
FDIC.................................................................. 14
FHLMC................................................................. 15
Final Recovery Determination.......................................... 15
FNMA.................................................................. 15
Hazardous Materials................................................... 15
Historical Loan Modification Report................................... 15
Historical Loss Estimate Report....................................... 15
Holder................................................................ 15
HUD-Approved Servicer................................................. 15
Impound Reserve....................................................... 15
Independent........................................................... 15
Independent Appraiser................................................. 16
Independent Contractor................................................ 16
Insurance Policy...................................................... 16
Insurance Proceeds.................................................... 16
Interested Person..................................................... 16
Investment Account.................................................... 17
Issue Price........................................................... 17
Late Collections...................................................... 17
Liquidation Event..................................................... 17
Liquidation Proceeds.................................................. 17
Loan Payoff Notification Report....................................... 18
Loan-to-Value Ratio................................................... 18
Majority Subordinate Certificateholder................................ 18
Master Servicer....................................................... 18
Master Servicing Fee.................................................. 18
Master Servicing Fee Rate............................................. 18
Merrill Lynch......................................................... 18
Monthly Payment....................................................... 18
Moody's............................................................... 18
Mortgage.............................................................. 19
Mortgage File......................................................... 19
Mortgage Loan......................................................... 20
Mortgage Loan Purchase Agreements..................................... 20
iii
<PAGE>
Page
----
Mortgage Loan Schedule................................................ 20
Mortgage Loan Seller.................................................. 21
Mortgage Note......................................................... 21
Mortgage Pool......................................................... 21
Mortgage Rate......................................................... 21
Mortgaged Property.................................................... 22
Mortgagor............................................................. 22
Net Aggregate Prepayment Interest Shortfall........................... 22
Net Investment Earnings............................................... 22
Net Investment Loss................................................... 22
Net Mortgage Rate..................................................... 22
Net Operating Income.................................................. 22
New Lease............................................................. 23
NOI Adjustment Worksheet.............................................. 23
Nonrecoverable Advance................................................ 23
Nonrecoverable P&I Advance............................................ 23
Nonrecoverable Servicing Advance...................................... 23
Non-Registered Certificate............................................ 23
Non-United States Person.............................................. 23
Officers' Certificate................................................. 23
Operating Statement Analysis.......................................... 23
Opinion of Counsel.................................................... 23
Original Component Notional Amount.................................... 24
Original Class Principal Balance...................................... 24
OTS................................................................... 24
Ownership Interest.................................................... 24
Pass-Through Rate..................................................... 24
Paying Agent.......................................................... 24
Percentage Interest................................................... 24
Percentage Premium.................................................... 25
Permitted Investments................................................. 25
Permitted Transferee.................................................. 26
Person................................................................ 27
Phase I Environmental Assessment...................................... 27
P&I Advance........................................................... 27
P&I Advance Date...................................................... 27
P&I Advance Date...................................................... 27
Plurality Residual Certificateholder.................................. 27
Prepayment Assumption................................................. 27
Prepayment Interest Excess............................................ 27
Prepayment Interest Shortfall......................................... 27
Prepayment Premium.................................................... 27
Prime Rate............................................................ 28
Principal Distribution Amount......................................... 28
Principal Prepayment.................................................. 29
iv
<PAGE>
Page
----
Principal Recovery Fee................................................ 29
Prospectus............................................................ 29
Prospectus Supplement................................................. 29
Purchase Price........................................................ 29
Qualified Insurer..................................................... 30
Rated Final Distribution Date......................................... 30
Rating Agency......................................................... 30
Realized Loss......................................................... 30
Record Date........................................................... 30
Registered Certificate................................................ 30
Regular Certificate................................................... 30
Reimbursement Rate.................................................... 31
Remaining Cash Flow................................................... 31
REMIC................................................................. 31
REMIC I............................................................... 31
REMIC I Regular Interest.............................................. 31
REMIC I Remittance Rate............................................... 31
REMIC II.............................................................. 31
REMIC II Regular Interest............................................. 31
REMIC II Remittance Rate.............................................. 32
REMIC III............................................................. 32
REMIC III Certificate................................................. 32
REMIC Administrator................................................... 32
REMIC Provisions...................................................... 32
Rents from Real Property.............................................. 32
REO Account........................................................... 32
REO Acquisition....................................................... 32
REO Disposition....................................................... 32
REO Extension......................................................... 32
REO Loan.............................................................. 32
REO Property.......................................................... 33
REO Revenues.......................................................... 33
REO Tax............................................................... 33
REO Status Report..................................................... 33
Request for Release................................................... 34
Required Appraisal.................................................... 34
Required Appraisal Mortgage Loan...................................... 34
Required Appraisal Value.............................................. 34
Reserve Account....................................................... 34
Reserve Funds......................................................... 34
Residual Certificate.................................................. 34
Responsible Officer................................................... 34
Revised Rate.......................................................... 35
Scheduled Payment..................................................... 35
Securities Act........................................................ 35
v
<PAGE>
Page
----
Senior Certificate.................................................... 35
Sequential Pay Certificate............................................ 35
Servicing Account..................................................... 35
Servicing Advances.................................................... 35
Servicing Fee......................................................... 36
Servicing File........................................................ 36
Servicing Officer..................................................... 36
Servicing Standard.................................................... 36
Servicing Transfer Event.............................................. 36
Single Certificate.................................................... 36
Special Servicer...................................................... 36
Special Servicing Fee................................................. 36
Special Servicing Fee Rate............................................ 37
Specially Serviced Mortgage Loan...................................... 37
Standard & Poor's..................................................... 39
Startup Day........................................................... 39
State and Local Taxes................................................. 39
Stated Maturity Date.................................................. 39
Stated Principal Balance.............................................. 39
Subordinated Certificate.............................................. 39
Sub-Servicer.......................................................... 39
Sub-Servicing Agreement............................................... 40
Tax Matters Person.................................................... 40
Tax Returns........................................................... 40
Transfer.............................................................. 40
Transferee............................................................ 40
Transferor............................................................ 40
Trust Fund............................................................ 40
Trustee............................................................... 40
Trustee's Fee......................................................... 40
Trustee Fee Rate...................................................... 40
Trustee Liability..................................................... 40
UCC................................................................... 41
UCC Financing Statement............................................... 41
Uncertificated Accrued Interest....................................... 41
Uncertificated Distributable Interest................................. 41
Uncertificated Principal Balance...................................... 41
Underwriter........................................................... 42
United States Person.................................................. 42
USAP.................................................................. 42
Voting Rights......................................................... 42
Watch List............................................................ 42
Weighted Average Effective REMIC I Remittance Rate.................... 43
Yield Maintenance Charge.............................................. 43
vi
<PAGE>
Page
----
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND
WARRANTIES; ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans................................. 44
SECTION 2.02. Acceptance of the Trust Fund by Trustee...................... 45
SECTION 2.03. Mortgage Loan Seller's Repurchase of Mortgage Loans
for Document Defects and Breaches of
Representations and Warranties............................ 46
SECTION 2.04. Representations and Warranties of Depositor.................. 48
SECTION 2.05. Execution, Authentication and Delivery of Class R-I
Certificates; Creation of REMIC I Regular
Interests................................................. 50
SECTION 2.06. Conveyance of REMIC I Regular Interests; Acceptance
of REMIC II by Trustee.................................... 50
SECTION 2.07. Execution, Authentication and Delivery of Class R-II
Certificates.............................................. 51
SECTION 2.08. Conveyance of REMIC II Regular Interests; Acceptance
of REMIC III by Trustee................................... 51
SECTION 2.09. Execution, Authentication and Delivery of REMIC III
Certificates.............................................. 51
SECTION 2.10. Execution, Authentication and Delivery of Class L
Certificates.............................................. 51
ARTICLE III ADMINISTRATION AND SERVICING OF THE TRUST FUND
SECTION 3.01. Administration of the Mortgage Loans......................... 52
SECTION 3.02. Collection of Mortgage Loan Payments......................... 53
SECTION 3.03. Collection of Taxes, Assessments and Similar Items;
Servicing Accounts; Reserve Accounts...................... 54
SECTION 3.04. Certificate Account and Distribution Account................. 57
SECTION 3.05. Permitted Withdrawals From the Certificate Account
and the Distribution Account.............................. 59
SECTION 3.06 Investment of Funds in the Servicing Accounts, the
Reserve Accounts, the Certificate Account and the
REO Account............................................... 63
SECTION 3.07. Maintenance of Insurance Policies; Errors and
Omissions and Fidelity Coverage........................... 65
SECTION 3.08. Enforcement of Alienation Clauses............................ 67
SECTION 3.09. Realization Upon Defaulted Mortgage Loans; Required
Appraisals................................................ 68
SECTION 3.10. Trustee and Custodian to Cooperate; Release of
Mortgage Files............................................ 71
SECTION 3.11. Servicing Compensation....................................... 72
SECTION 3.12. Property Inspections; Collection of Financial
Statements; Delivery of Certain Reports................... 75
SECTION 3.13. Annual Statement as to Compliance............................ 77
SECTION 3.14. Reports by Independent Public Accountants.................... 77
SECTION 3.15. Access to Certain Information................................ 78
SECTION 3.16. Title to REO Property; REO Account........................... 80
vii
<PAGE>
Page
----
SECTION 3.17. Management of REO Property................................... 82
SECTION 3.18. Sale of Mortgage Loans and REO Properties.................... 85
SECTION 3.19. Additional Obligations of Master Servicer.................... 88
SECTION 3.20. Modifications, Waivers, Amendments and Consents.............. 88
SECTION 3.21. Transfer of Servicing Between Master Servicer and
Special Servicer; Record Keeping.......................... 91
SECTION 3.22. Sub-Servicing Agreements..................................... 93
SECTION 3.23. Representations, Warranties and Covenants of Master
Servicer and Special Servicer............................. 95
SECTION 3.24. Sub-Servicing Agreement Representation and Warranty.......... 99
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions................................................ 99
SECTION 4.02. Statements to Certificateholders; CSSA Loan File
Report.................................................... 107
SECTION 4.03. P&I Advances................................................. 113
SECTION 4.04. Allocation of Realized Losses and Additional Trust
Fund Expenses............................................. 115
SECTION 4.05. Calculations................................................. 116
SECTION 4.06. Use of Agents................................................ 116
ARTICLE V THE CERTIFICATES
SECTION 5.01. The Certificates............................................. 117
SECTION 5.02. Registration of Transfer and Exchange of
Certificates.............................................. 117
SECTION 5.03. Book-Entry Certificates...................................... 123
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates............ 124
SECTION 5.05. Persons Deemed Owners........................................ 124
ARTICLE VI THE DEPOSITOR, THE MASTER SERVICER AND THE
SPECIAL SERVICER
SECTION 6.01. Liability of Depositor, Master Servicer and Special
Servicer.................................................. 125
SECTION 6.02. Merger, Consolidation or Conversion of Depositor or
Master Servicer or Special Servicer....................... 125
SECTION 6.03. Limitation on Liability of Depositor, Master
Servicer and Special Servicer............................. 125
SECTION 6.04. Resignation of Master Servicer and the Special
Servicer; Assignment of Rights and Obligations............ 126
SECTION 6.05. Rights of Depositor and Trustee in Respect of Master
Servicer and the Special Servicer......................... 127
SECTION 6.06. Depositor, Master Servicer and Special Servicer to
Cooperate with Trustee.................................... 128
SECTION 6.07. Depositor, Special Servicer and Trustee to Cooperate
with Master Servicer...................................... 128
viii
<PAGE>
Page
----
SECTION 6.08. Depositor, Master Servicer and Trustee to Cooperate
with Special Servicer..................................... 128
SECTION 6.09. Designation of Special Servicer by the Controlling
Class..................................................... 128
SECTION 6.10. Master Servicer or Special Servicer as Owner of a
Certificate............................................... 130
ARTICLE VII DEFAULT
SECTION 7.01. Events of Default............................................ 131
SECTION 7.02. Trustee to Act; Appointment of Successor..................... 135
SECTION 7.03. Notification to Certificateholders........................... 136
SECTION 7.04. Waiver of Events of Default.................................. 136
SECTION 7.05. Additional Remedies of Trustee Upon Event of Default......... 137
ARTICLE VIII CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee............................................ 138
SECTION 8.02. Certain Matters Affecting Trustee............................ 139
SECTION 8.03. Trustee Not Liable for Validity or Sufficiency of
Certificates or Mortgage Loans............................ 140
SECTION 8.04. Trustee May Own Certificates................................. 141
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of
Trustee................................................... 141
SECTION 8.06. Eligibility Requirements for Trustee......................... 142
SECTION 8.07. Resignation and Removal of Trustee........................... 142
SECTION 8.08. Successor Trustee............................................ 144
SECTION 8.09. Merger or Consolidation of Trustee........................... 144
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee................ 144
SECTION 8.11. Appointment of Custodians.................................... 146
SECTION 8.12. Appointment of Authenticating Agents......................... 146
SECTION 8.13. Appointment of Paying Agent.................................. 147
SECTION 8.14. Appointment of REMIC Administrators.......................... 148
SECTION 8.15. Access to Certain Information................................ 149
SECTION 8.16. Representations, Warranties and Covenants of Trustee......... 149
SECTION 8.17. Reports to the Securities and Exchange Commission;
Available Information..................................... 150
ARTICLE IX TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All
Mortgage Loans............................................ 152
SECTION 9.02. Additional Termination Requirements.......................... 158
ARTICLE X ADDITIONAL REMIC PROVISIONS
SECTION 10.01. REMIC Administration........................................ 160
ix
<PAGE>
Page
----
ARTICLE XI MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment................................................... 165
SECTION 11.02. Recordation of Agreement; Counterparts...................... 167
SECTION 11.03. Limitation on Rights of Certificateholders.................. 167
SECTION 11.04. Governing Law............................................... 168
SECTION 11.05. Notices..................................................... 168
SECTION 11.06. Severability of Provisions.................................. 169
SECTION 11.07. Grant of a Security Interest................................ 169
SECTION 11.08. Successors and Assigns; Beneficiaries....................... 169
SECTION 11.09. Article and Section Headings................................ 169
SECTION 11.10. Notices to and From Rating Agencies......................... 170
SECTION 11.11. Complete Agreement.......................................... 171
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 IO Certificate A-3 Section 1.01 Definition
of "Class IO Certificate"
Form of Class B Certificate A-4 Section 1.01 Definition
of "Class B Certificate"
Form of Class C Certificate A-5 Section 1.01 Definition
of "Class C Certificate"
Form of Class D Certificate A-6 Section 1.01 Definition
of "Class D Certificate"
Form of Class E Certificate A-7 Section 1.01 Definition
of "Class E Certificate"
Form of Class F Certificate A-8 Section 1.01 Definition
of "Class F Certificate"
Form of Class G Certificate A-9 Section 1.01 Definition
of "Class G Certificate"
Form of Class H Certificate A-10 Section 1.01 Definition
of "Class H Certificate"
Form of Class J Certificate A-11 Section 1.01 Definition
of "Class J Certificate"
Form of Class K Certificate A-12 Section 1.01 Definition
of "Class K Certificate"
Form of Class L Certificate A-13 Section 1.01 Definition
of "Class L Certificate"
Form of Class R-I Certificate A-14 Section 1.01 Definition
of "Class R-I Certificate"
xi
<PAGE>
EXHIBITS
Exhibit Description Exhibit No. Section Reference
------------------- ---------- -----------------
Form of Class R-II Certificate A-15 Section 1.01 Definition
of "Class R-II Certificate"
Form of Class R-III Certificate A-16 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 Transferor Certificate F-1 Section 5.02(b)
Form of Transferee Certificate F-2 Section 5.02(b)
for QIBs
Form of Transferee Certificate F-3 Section 5.02(b)
for Non-QIBs
Form of Transferee Letter for G Section 5.02(c)
Transfers of Subordinated
Certificates to Non-Plan
Entities
Form of Transfer Affidavit and H-1 Section 5.02(d)(i)(B)
Agreement regarding Class R-I,
R-II and R-III Certificates
Form of Transferor Certificate H-2 Section 5.02(d)(i)(D)
regarding Class R-I, R-II and
R-III Certificates
xii
<PAGE>
EXHIBITS
Exhibit Description Exhibit No. Section Reference
------------------- ---------- -----------------
Form of Notice and I-1 Section 6.09
Acknowledgment
Form of Acknowledgment of I-2 Section 6.09
Proposed Special Servicer
[RESERVED] J
Form of Schedule of K Section 4.02(a)
Certificateholders
Form of CSSA Property File L Section 3.12(c)
Report
Form of Comparative Financial M Section 3.12(b) and 3.12(c)
Status Report
Form of REO Status Report N Section 3.12(b) and 3.12(c)
Form of Watch List O Section 3.12(b) and 3.12(c)
Form of Delinquent Loan Status P Section 3.12(b) and 3.12(c)
Report
Form of Historical Loan Q Section 3.12(b) and 3.12(c)
Modification Report
Form of Historical Loss R Section 3.12(b) and 3.12(c)
Estimate Report
Form of NOI Adjustment S Section 3.12(b) and 3.12(c)
Worksheet
Form of Operating Statement T Section 3.12(b) and 3.12(c)
Analysis
Form of Loan Payoff U Section 3.12(b) and 3.12(c)
Notification Report
Form of CSSA Loan File Report V Section 4.02(b)
Form of Certificateholder W-1 Section 3.15
Confirmation Certificate
Form of Prospective Purchaser W-2 Section 3.15
Certificate
xiii
<PAGE>
EXHIBITS
Exhibit Description Exhibit No. Section Reference
------------------- ---------- -----------------
Form of Lost Note Affidavit X Definition of Mortgage
and Indemnity File
xiv
<PAGE>
This Pooling and Servicing Agreement (this "Agreement") is dated and
effective as of March 1, 1998, among MERRILL LYNCH MORTGAGE INVESTORS, INC., as
Depositor, FIRST UNION NATIONAL BANK, as Master Servicer, CRIIMI MAE SERVICES
LIMITED PARTNERSHIP, as Special Servicer, and NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee.
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 and a portion of the interest payments
thereon other than Additional Interest as well as certain other related assets
subject to this Agreement as 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 under the federal income tax law. Except as
provided below, each 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 unmodified Net Mortgage Rate as of the Closing Date of the Mortgage Loan to
which such REMIC I Regular Interest relates and an initial Uncertificated
Principal Balance equal to the Cut-Off Date Balance of the Mortgage Loan to
which such REMIC I Regular Interest relates. None of the REMIC I Regular
Interests will be certificated.
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 REMIC II Remittance Rate with respect to each Class of the REMIC II
Regular Interests will be calculated in accordance with the definition of "REMIC
II Remittance Rate". The initial Uncertificated Principal Balance of each Class
of the REMIC II Regular Interests will equal the Original Class Principal
Balance of the corresponding Class of the REMIC III Certificates described
below. None of the REMIC II Regular Interests will be certificated.
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. For federal income tax purposes, each Class of the
Regular Certificates (other than the Class IO Certificates) and each of the
Components of the Class IO Certificates will be designated as a separate regular
interest in REMIC III for purposes of the REMIC Provisions under federal income
tax law.
<PAGE>
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The following table sets forth the Class designation of the REMIC III
Certificates other than the Class IO and Class R-III Certificates, the
corresponding REMIC II Regular Interests, the corresponding Component of the
Class IO Certificates and the Original Class Principal Balance for each Class of
the Regular Certificates other than the Class IO Certificates.
Corresponding
Class of
REMIC II
Class Regular Corresponding Original Class
Designation Interests IO Component Principal Balance
----------- --------- ------------ -----------------
Class A-1 P IO-A1 $229,904,000
Class A-2 Q IO-A2 $559,138,000
Class B R IO-B $ 32,650,000
Class C S IO-C $ 59,859,000
Class D T IO-D $ 70,742,000
Class E U IO-E $ 16,325,000
Class F V IO-F $ 59,858,000
Class G W IO-G $ 5,442,000
Class H X IO-H $ 21,766,000
Class J Y IO-J $ 5,442,000
Class K Z IO-K $ 27,204,822
The Class L Certificates will not constitute an interest in REMIC I, REMIC
II or REMIC III.
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer, the Special Servicer and the Trustee agree as follows:
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
<PAGE>
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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 each Component of the Class
IO Certificates 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 ARD Mortgage Loans
indicated on the Mortgage Loan Schedule as having a Revised Rate, interest
accrued on such ARD Mortgage Loan at the Additional Interest Rate and any
interest which accrues on such interest at the Revised 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 "Norwest Bank Minnesota,
National Association, in trust for Holders of Merrill Lynch Mortgage Investors,
Inc., Mortgage Pass-Through Certificates, Series 1998-C2, 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.
"Additional Interest Rate": With respect to each of the ARD Mortgage Loans,
the excess of (i) the applicable Revised Rate over (ii) the applicable Mortgage
Rate immediately prior to the related Anticipated Repayment Date, 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 and the Trustee 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
<PAGE>
-4-
purposes of the allocations contemplated by Section 4.04 no such expense shall
be deemed to 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.
"Anticipated Repayment Date": With respect to an ARD Mortgage Loan, the
date upon which such ARD Mortgage Loan commences accruing interest at the
Revised Rate.
"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 or the Trustee, 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 and Additional
Trust Fund Expenses in respect of such Required Appraisal Mortgage Loan, (iv)
all related unreimbursed Advances (plus accrued interest thereon) made by or on
behalf of the Master Servicer, the Special Servicer or the Trustee 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, 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,
<PAGE>
-5-
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.
"ARD Mortgage Loans": The Mortgage Loans noted as such on the Mortgage Loan
Schedule, which Mortgage Loans substantially fully amortize through their
respective remaining terms to maturity, but provide that if the unamortized
principal amount thereof is not repaid on a specified date prior to maturity set
forth in the related Mortgage Note, the Mortgage Loan will accrue at a higher
interest rate the collection of which will be limited as hereinafter provided in
this Agreement.
"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.
"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
<PAGE>
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Servicer or the Trustee 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, Rockville, Maryland, Minneapolis,
Minnesota or the cities in which the Corporate Trust Office of the Trustee or
the offices of the Master Servicer (as of the Closing Date, Charlotte, North
Carolina) are 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.
"Certificate": Any one of the Depositor's Mortgage Pass-Through
Certificates, Series 1998-C2, 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 "First Union
National Bank, as Master Servicer
<PAGE>
-7-
for Norwest Bank Minnesota, National Association, as Trustee, on behalf of and
in trust for the registered holders of Merrill Lynch Mortgage Investors, Inc.,
Mortgage Pass-Through Certificates, Series 1998-C2."
"Certificate Factor": With respect to any Class of Sequential Pay
Certificates, as of any date of determination, a fraction, expressed as a
decimal carried to eight places, the numerator of which is the then current
Class Principal Balance of such Class of Sequential Pay 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 each of the Components.
"Certificate Owner": With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Certificate as reflected on the books of the
Depository or on the books of a Depository Participant or on the books of an
indirect participating brokerage firm for which a Depository Participant acts as
agent.
"Certificate Principal Balance": With respect to any Sequential Pay
Certificate, as of any date of determination, the then outstanding principal
amount of such Certificate equal to the product of (a) the 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, or the Trustee
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),
any Certificate registered in the name of the Depositor, any Mortgage Loan
Seller, the Master Servicer, the Special Servicer, or the Trustee, 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, 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
<PAGE>
-8-
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 portion of 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 portion of 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-4
attached hereto, and evidencing a portion of 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-5
attached hereto, and evidencing a portion of 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-6
attached hereto, and evidencing a portion of 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-7
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class F Certificate": Any one of the Certificates with a "Class F"
designation on the face thereof, substantially in the form of Exhibit A-8
attached hereto, and evidencing a portion of 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-9
attached hereto, and evidencing a portion of 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-10 attached hereto,
and evidencing a portion of a "regular interest" in REMIC III for purposes of
the REMIC Provisions.
<PAGE>
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"Class IO Certificate": Any one of the Certificates with a "Class IO"
designation on the face thereof, substantially in the form of Exhibit A-3
attached hereto, and evidencing a portion of the aggregate of the Components,
each of which shall constitute a separate "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-11 attached hereto,
and evidencing a portion of a "regular interest" in REMIC III for purposes of
the REMIC Provisions.
"Class K Certificate": Any of the Certificates with a "Class K" designation
on the face thereof, substantially in the form of Exhibit A-12 attached hereto,
and evidencing a portion of a "regular interest" in REMIC III for purposes of
the REMIC Provisions.
"Class L Certificate": Any of the Certificates with a "Class L" designation
on the face thereof, substantially in the form of Exhibit A-13 attached hereto,
and evidencing the right to receive Additional Interest, which portion of the
Trust Fund will be treated as a grantor trust (and not as part of REMIC I, REMIC
II or REMIC III) for federal income tax purposes.
"Class Prepayment Percentage": With respect to any Distribution Date and
any Class of the Sequential Pay Certificates, the percentage obtained by
dividing the portion, if any, of the Principal Distribution Amount distributed
to the respective Class of Sequential Pay Certificates on such Distribution
Date, by the total Principal Distribution Amount distributed to all Classes of
Sequential Pay Certificates on such Distribution Date.
"Class Principal Balance": As of the Closing Date, the Class Principal
Balance of each Class of Sequential Pay 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). Distributions in respect of
a reimbursement of Realized Losses and Additional Trust Fund Expenses previously
allocated to a Class of Sequential Pay Certificates shall not constitute
distributions of principal and shall not result in reduction of the related
Class Principal Balance.
"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-14
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-15
attached hereto, and evidencing the sole class of "residual interests" in REMIC
II for purposes of the REMIC Provisions.
<PAGE>
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"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-16
attached hereto, and evidencing the sole class of "residual interests" in REMIC
III for purposes of the REMIC Provisions.
"Closing Date": March 27, 1998.
"Code": The Internal Revenue Code of 1986, as amended.
"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.
"Comparative Financial Status Report": A report substantially containing
the content described in Exhibit N attached hereto, setting forth, among other
things, the occupancy, revenue, net operating income and Debt Service Coverage
Ratio for each Mortgage Loan or the related Mortgaged Property, as of the last
day of the calendar month immediately preceding the preparation of such report,
for (i) each of the three immediately preceding monthly periods (to the extent
such information is available), (ii) the most current available year-to-date,
(iii) the previous two full fiscal years, and (iv) the "base year" (representing
the original analysis of information used as of the Cut-Off Date). For the
purposes of the Special Servicer's production of any such report that is
required to state information for any period prior to the Cut-Off Date, the
Special Servicer may conclusively rely (without independent verification),
absent manifest error, on information provided to it by the related Mortgage
Loan Seller.
"Component": Each of the eleven Components of the Class IO Certificates,
and collectively, the "Components," each evidencing a separate "regular
interest" in REMIC III for purposes of the REMIC Provisions and corresponding to
a Class of Sequential Pay Certificates.
"Component Notional Amount": With respect to each Component and any
Distribution Date, an amount equal to the Class Principal Balance of its
corresponding Class of Sequential Pay Certificates as of such Distribution Date.
"Controlling Class": As of any date of determination, the Class of
Sequential Pay Certificates outstanding (a) which bears the latest alphabetical
Class designation and (b) the Class Principal Balance of which is greater than
each of (i) 20% of the Original Class Principal Balance thereof and (ii) 1% of
the aggregate Class Principal Balance of all Sequential Pay Certificates;
provided, however, that if no such Class of Certificates has a Class Principal
Balance greater than each of (i) 20% of its Original Class Balance and (ii) 1%
of the aggregate Class Principal Balance of all Sequential Pay Certificates, the
Controlling Class shall be the Class of Sequential Pay Certificates bearing the
latest alphabetical Class designation. With respect to determining the
Controlling Class, the Class A-1 and Class A-2 Certificates shall be deemed a
single Class of Certificates.
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"Corporate Trust Office": The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 11000 Broken Land Parkway, Columbia,
Maryland 21044-3562, Attn: Corporate Trust Services (CMBS) -- Merrill Lynch
Series 1998-C2.
"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".
"CSSA Loan File Report": The monthly report in the "CSSA loan file" format
substantially containing the information called for therein for the Mortgage
Loans, a form of which is attached hereto as Exhibit V.
"CSSA Property File Report": The monthly report in the "CSSA property file"
format containing the information called for therein for each Mortgaged
Property, a form of which is attached hereto as Exhibit L, which for each
Distribution Date shall set forth certain information set forth therein as of
the end of the preceding calendar month.
"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, a Mortgage Loan Seller or an Affiliate of the
Depositor or a Mortgage Loan Seller. 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": March 1, 1998.
"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.
"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 related Mortgage or Mortgage Note and without
regard to any acceleration of payments under
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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 identified as a Defeasance Loan on the
Mortgage Loan Schedule which permits the related Mortgagor to pledge Defeasance
Collateral to the holder of such Mortgage Loan in lieu of prepayment.
"Definitive Certificate": As defined in Section 5.03(a).
"Delinquent Loan Status Report": A report substantially containing the
content described in Exhibit P attached hereto setting forth, among other
things, those Mortgage Loans which, as of the close of business on the
Determination Date immediately preceding the preparation of such report, were
delinquent 30-59 days, delinquent 60-89 days, delinquent 90 days or more,
current but are Specially Serviced Mortgage Loans or were in foreclosure but
were not REO Property.
"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 Exchange Act.
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the tenth day
of the month in which such Distribution Date occurs, or if such tenth day is not
a Business Day, the next Business Day.
"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 Special Servicer or any Sub-Servicer on
behalf of the Trust Fund, shall not be considered to Directly Operate an REO
Property solely because such Special Servicer or Sub-
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Servicer establishes rental terms, chooses tenants, enters into or renews
leases, deals with taxes and insurance, or makes decisions as to repairs or
capital expenditures with respect to such REO Property.
"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 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 "Norwest Bank Minnesota, National Association,
as Trustee, in trust for the registered holders of Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series 1998-C2."
"Distribution Date": The later of (a) the 15th day of any month, or if such
15th day is not a Business Day, the Business Day immediately following and (b)
the fourth Business Day following the related Determination Date, commencing on
April 16, 1998.
"Distribution Date Statement": As defined in Section 4.02(a).
"Document Defect": As defined in Section 2.03(a).
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"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 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 (including the Trustee),
and (a) with respect to deposits held for 30 days or more in such account, the
long-term deposit or unsecured debt obligations of which are rated "AA" by
Standard & Poor's, and "A2" by Moody's (if then rated by Moody's) or, in each
such case, 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 (b) with respect to deposits held for less than 30 days in such account, the
short-term deposits of which are rated P-1 by Moody's (if then rated by Moody's)
and A-1 by Standard & Poor's or, in each such case, 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 (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.
"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 a
multifamily 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.
"Event of Default": One or more of the events described in Section 7.01(a).
"Exchange Act": The Securities Exchange Act of 1934.
"FDIC": Federal Deposit Insurance Corporation or any successor.
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"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 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, the Special Servicer 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.
"FNMA": Federal National Mortgage Association or any successor.
"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.
"Historical Loan Modification Report": A report substantially containing
the content described in Exhibit Q attached hereto, setting forth, among other
things, those Mortgage Loans which, as of the close of business on the
Determination Date immediately preceding the preparation of such report, have
been modified pursuant to this Agreement (i) during the related Collection
Period and (ii) since the Cut-Off Date, showing the original and the revised
terms thereof.
"Historical Loss Estimate Report": A report substantially containing the
content described in Exhibit R attached hereto, setting forth, among other
things, as of the close of business on the Determination Date immediately
preceding the preparation of such report, (i) the aggregate amount of
Liquidation Proceeds and expenses relating to each Final Recovery Determination
made, both during the related Collection Period and historically, and (ii) the
amount of Realized Losses occurring during the related Collection Period, set
forth on a Mortgage Loan-by-Mortgage Loan basis.
"Holder": A Certificateholder.
"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.
"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
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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, who is, if the
State in which the subject Mortgaged Property is located certifies or licenses
appraisers, certified or licensed in such State, and who has a minimum of five
years experience in the subject property type and market.
"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 Regulations 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.
"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, the Trustee, any Holder of a Certificate, or any
Affiliate of any such Person.
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"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 default interest or late
payment fees, whether as payments, Insurance Proceeds, Liquidation Proceeds or
otherwise, which represent late collections 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, the Special Servicer 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, the
Special Servicer 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, the Special Servicer or the Master Servicer pursuant to Section 9.01.
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"Loan Payoff Notification Report": A report substantially containing the
content described in Exhibit U attached hereto setting forth, among other things
for each Mortgage Loan where notice of anticipated payoff has been received as
of the Determination Date immediately preceding the preparation of such report
the control number, the property name, the amount of principal expected to be
paid, the expected date of payment and the estimated amount of Yield Maintenance
Charge or Percentage Premium due.
"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 Sequential Pay Certificates with
the latest alphabetical 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 and Class A-2 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": First Union National Bank, its successor in interest, or
any successor master servicer appointed as herein provided.
"Master Servicing Fee": With respect to each Mortgage Loan and REO Loan,
the fee payable to the Master Servicer pursuant to Section 3.11(a).
"Master Servicing Fee Rate": With respect to each Mortgage Loan the per
annum rate set forth for such Mortgage Loan under the column "Master Servicing
Fee" on the Mortgage Loan Schedule.
"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
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Person designated by the Depositor, notice of which designation shall be given
in writing to the Trustee, 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, (or with respect to Mortgage
Loans control numbers 501, 247, 131, 174, 183, 227 and 260, a
lost note affidavit and indemnity (a form of which is attached
hereto as Exhibit X) with a copy of such Mortgage Note attached
thereto) endorsed (without recourse, representation or warranty,
express or implied) to the order of Norwest Bank Minnesota,
National Association, as trustee for the registered holders of
Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1998-C2;
(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 (if such
item is a document separate from the Mortgage) and of any
intervening assignment thereof, in each case with evidence of
recording indicated thereon;
(iv) (a) an original executed assignment of the Mortgage in recordable
form, (b) any related Assignment of Leases (if such item is a
document separate from the Mortgage) in recordable form and (c)
any other recorded document relating to the Mortgage Loan
otherwise included in the Mortgage File, in favor of Norwest Bank
Minnesota, National Association as trustee for the registered
holders of Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1998-C2, in recordable form;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of Norwest Bank Minnesota, National
Association, as trustee for the registered holders of Merrill
Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1998-C2;
(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;
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(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 related
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 related
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 Norwest Bank Minnesota,
National Association, as trustee for the registered holders of
Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1998-C2 in recordable form.
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 a Responsible Officer of the Trustee or Custodian has actual knowledge of
their existence
"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 March 1, 1998, between the Depositor and the
respective Mortgage Loan Sellers 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;
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(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 Mortgage on a
leasehold interest;
(ix) whether the Mortgage Loan is an ARD Mortgage Loan and if so, the
Anticipated Repayment Date and the Revised Rate;
(x) the Master Servicing Fee Rate;
(xi) the related Mortgage Loan Seller;
(xii) the related Sub-Servicer;
(xiii) whether such Mortgage Loan is a Defeasance Loan;
(xiv) whether the interest accrual method for such Mortgage Loan is
actual/360 or 30/360; and
(xv) whether such Mortgage Loan is cross defaulted with any other
Mortgage Loan.
"Mortgage Loan Seller": Each of Merrill Lynch Mortgage Capital Inc. or its
successor in interest, Daiwa Real Estate Finance Corp. or its successors 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)
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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 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 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 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 applicable Master 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 interest in respect of 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 Weighted Average Effective REMIC I Remittance
Rate, the REMIC II Remittance Rate and the Pass-Through Rate for each of the
Components 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.
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"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.
"NOI Adjustment Worksheet": A report prepared by the Special Servicer,
substantially containing the content described in Exhibit T attached hereto,
presenting the computations made in accordance with the methodology described in
Exhibit S to "normalize" the full year net operating income and debt service
coverage numbers used in the other reports required by this Agreement, delivered
to the Master Servicer with each annual operating statement for a Mortgaged
Property pursuant to Section 3.12(b).
"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 by the Master Servicer or
Trustee, as the case may be, that, as determined by the Master Servicer in
accordance with the Servicing Standard with respect to such P&I Advance 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 by the Master
Servicer, the Special Servicer or Trustee, as the case may be, that, as
determined by the Master Servicer, the Special Servicer or the Trustee 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 K, Class L, Class
R-I, Class R-II or Class R-III Certificate.
"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.
"Operating Statement Analysis": With respect to each Mortgage Loan and REO
Property, a report substantially containing the content described in Exhibit T
attached hereto.
"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.
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"Original Component Notional Amount": With respect to each Component, the
initial Component Notional Amount thereof as of the Closing Date equal to the
Original Class Principal Balance of the corresponding Class of Sequential Pay
Certificates as of the Closing Date.
"Original Class Principal Balance": With respect to any Class of Sequential
Pay 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": For any Distribution Date, with respect to:
(i) the Class A-1 and Class A-2 Certificates, 6.22% and 6.39%,
respectively;
(ii) the Class B, C, D and E Certificates, the REMIC II Remittance
Rate for such Distribution Date minus 1.41%, 1.25%, 0.90 and
0.56%, respectively;
(iii) each of the Class F, G, H, J and K Certificates, 6.25%;
(iv) Components IO-A1 and IO A-2, the REMIC II Remittance Rate for
such Distribution Date minus 6.22 and 6.39%, respectively;
(v) Components IO-B, IO-C, IO-D and IO-E, 1.41%, 1.25%, 0.90% and
0.56%, respectively; and
(vi) Component IO-F, IO-G, IO-H, IO-J and IO-K, the REMIC II
Remittance Rate for such Distribution Date minus 6.25%.
"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.
"Percentage Interest": With respect to any Sequential Pay Certificate, a
percentage, the numerator of which is the initial Certificate Principal Balance
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 of the
relevant Class. With respect to any Class IO Certificate, a percentage, the
numerator of which is the initial Certificate Notional Amount of such
Certificate as of the Closing Date, as specified on the face thereof, and the
denominator of which is the aggregate Original Class Principal Balances of the
Sequential Pay Certificates. With respect to a Class L Certificate or a
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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) 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 Standard &
Poor's. Interest may either be 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 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 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;
(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 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
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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 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 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
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 be 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 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.
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"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 or the Trustee 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).
"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), except each ARD Mortgage Loan is assumed to be paid in full on its
Anticipated Repayment Date.
"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 Master Servicing Fee) accrued on the amount
of such Principal Prepayment during the period from and after such Due Date, to
the extent collected (exclusive of any Prepayment Premium collected).
"Prepayment Interest Shortfall": With respect to any Mortgage Loan (other
than a Specially Serviced 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 (excluding Additional
Interest), to the extent not collected from the related Mortgagor (without
regard to any Prepayment Premium that may have been collected), that would have
accrued at a rate per annum equal to the sum of (x) the Net Mortgage Rate for
such Mortgage Loan and (y) the Trustee Fee Rate 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 or Percentage Premium
paid or payable, as the context requires, by a Mortgagor in connection with a
Principal Prepayment.
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"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 and the Special Servicer in writing
of its selection.
"Principal Distribution Amount": With respect to any Distribution Date, the
aggregate of the following (without duplication):
(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;
(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
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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 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 February 25, 1998, as supplemented by
the Prospectus Supplement, relating to the Registered Certificates.
"Prospectus Supplement": The prospectus supplement dated March
24, 1998, 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, the Special Servicer 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 other 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.
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"Qualified Insurer": An insurance company or security or bonding company
qualified to write the related Insurance Policy in the relevant jurisdiction.
"Rated Final Distribution Date": Solely for purposes of satisfying Treasury
Regulations Section 1.860G-1(a)(4)(iii) and with respect to (i) each REMIC I
Regular Interest, (ii) each REMIC II Regular Interest, (iii) each Class of
Regular Certificates (other than the Class IO Certificates) and (iv) each
Component, February 15, 2030.
"Rating Agency": Each of 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 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 or previously accrued interest 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 or interest 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 B, Class C, Class
D, Class E or Class IO Certificate.
"Regular Certificate": Any REMIC III Certificate other than a Class R-III
Certificate.
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"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 an ARD 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 (excluding (X)
payments of principal and interest due, and principal prepayments received, on
or before the Cut-Off Date, (Y) the Additional Interest, and any other interest
payable on the Mortgage Loans which is attributable to any portion of a
Servicing Fee that is deemed to be in excess of the amount which constitutes
reasonable servicing compensation within the meaning of the REMIC Provisions,
and (Z) the Reserve Funds in the Reserve Accounts), together with all documents
included in the related Mortgage Files and any Escrow Payments; (ii) any REO
Property acquired in 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 (other than amounts excluded
pursuant to clause (i) above); and (iv) the rights of the Depositor under 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 as of the Cut-Off Date 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 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 REMIC II Remittance Rate in effect from time to time, and 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
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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 REMIC II Regular Interest
for any Distribution Date, the Weighted Average Effective REMIC I Remittance
Rate for such Distribution Date.
"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 B, Class C, Class
D, Class E, Class F, Class G, Class H, Class J, Class K, 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.
"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 "CRIIMI MAE Services Limited
Partnership, as Special Servicer, in trust for Holders of Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series 1998-C2.".
"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).
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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, the Special Servicer or the Trustee, for the
payment of, the costs of operating, managing and maintaining the related REO
Property or for the reimbursement to the Master Servicer, the Special Servicer
or the Trustee for other related Servicing Advances) 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 or
the Trustee in respect of the predecessor Mortgage Loan as of the date of the
related REO Acquisition, including, without limitation, any unpaid 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 or the
Trustee in respect of such Servicing Advances and P&I Advances in accordance
with Sections 3.03(d) and 4.03(d), shall continue to be payable or reimbursable
to the Master Servicer, the Special Servicer or the Trustee, 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 of the Trust Fund
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).
"REO Status Report": A report substantially containing the content
described in Exhibit N attached hereto, setting forth, among other things, with
respect to each REO Property that was included in the Trust Fund as of the close
of business on the Determination Date immediately preceding the preparation of
such report, (i) the acquisition date of such REO Property, (ii) the amount of
income collected with respect to such REO Property (net of related expenses) and
other amounts, if any, received on such REO Property during the related
Collection Period and (iii) the value of the REO Property based on the most
recent appraisal or other valuation thereof available to the Special Servicer as
of such Determination Date (including any prepared internally by the Special
Servicer).
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"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 (i) that is sixty
(60) days or more delinquent in respect of any Monthly Payments, (ii) that is an
REO Loan as to which the related REO Property is acquired on behalf of the Trust
Fund, (iii) that has been modified by the Special Servicer to reduce the amount
of any Monthly Payment, other than a Balloon Payment, (iv) to which a receiver
is appointed and continues in such capacity in respect of the related Mortgage
Property, (v) the Mortgagor of which shall have filed a petition or been
subjected to the appointment of a conservator or receiver or liquidator in any
insolvency or related proceeding or (vi) a Balloon Payment with respect to which
is due and has not been paid on its Stated Maturity Date.
"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.
"Residual Certificate": A Class R-I, Class R-II or Class R-III Certificate.
"Responsible Officer": When used with respect to the Trustee, any officer
or assistant officer in the Corporate Trust Department of the Trustee or any
other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers to
whom a particular matter is referred by the Trustee because of such officer's
knowledge of and familiarity with the particular subject.
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"Revised Rate": With respect to an ARD Mortgage Loan, the increased
interest rate after the Anticipated Repayment Date (in the absence of a default)
for such ARD Mortgage Loan, as calculated and as set forth in the related
Mortgage loan documents.
"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 an ARD Mortgage 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 or Class IO Certificate.
"Sequential Pay Certificate": Any Class A-1, Class A-2, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J or Class K Certificates.
"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,
Special Servicer or the Trustee (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 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, (f) the operation,
management, maintenance and liquidation of any REO Property, including, without
limitation, appraisals and (g) compliance with the obligations of the Master
Servicer or the Trustee set forth in Section 2.03(a). 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.
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"Servicing Fee": The Master Servicing Fee and the Special Servicing Fee.
"Servicing File": Any documents (other than documents required to be part
of the related Mortgage File) in the possession of the Depositor (and delivered
to the Master Servicer or Special Servicer) 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, the servicing and administration of the Mortgage Loans for which it is
responsible hereunder (a) 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 with similar borrowers (i) for other third-party portfolios,
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, (b) with a view to the
maximization of the recovery on such Mortgage Loan on a net present value basis,
and (c) without regard to (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 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; and (v) the ownership, servicing or management for others of
any other mortgage loans or mortgaged property.
"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": CRIIMI MAE Services Limited Partnership, 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).
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"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 (x) 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 (y) if the Master
Servicer or any of its Affiliates owns an economic interest in such
Mortgage Loan or such Mortgagor, failed to make any Monthly Payment on
or before the related P&I Advance Date; 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 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,
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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 have consented to (or otherwise have been
subjected 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 have admitted in writing its inability to
pay its debts generally as they become due, filed a petition to take
advantage of any applicable insolvency or reorganization statute, made
an assignment for the benefit of its creditors, or voluntarily
suspended payment of its obligations; or
(g) the Master Servicer shall have received notice of the commencement of
foreclosure or similar proceedings with respect to the related
Mortgaged Property;
provided, however, that a Mortgage Loan 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 5 days following 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;
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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 in writing to the Trustee, the Master Servicer and
the Special Servicer, and specific ratings of Standard & Poor's Ratings 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 any states of Delaware, Maryland,
Minnesota and New York 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 or Class K Certificate.
"Sub-Servicer": Any Person with which the Master Servicer or the Special
Servicer has entered into a Sub-Servicing Agreement.
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"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.
"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 Regulations Section 1.860F-4(d) and Temporary Treasury
Regulations Section 301.6231(a)(7)-1T, which Person shall be the applicable
Plurality Residual Certificateholder.
"Tax Returns": With respect to (i) each of the REMICs created hereunder,
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, and (ii) with respect to Additional Interest and any other
portion of the Trust Fund that does not constitute part of REMIC I, REMIC II and
REMIC III, Internal Revenue Service Form 1041, together, in each case, 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.
"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.
"Trust Fund": Collectively, (i) all of the assets of REMIC I, REMIC II and
REMIC III, and (ii) the Additional Interest and any other interest on the
Mortgage Loans which is attributable to any portion of a Servicing Fee that is
deemed to be in excess of the amount of such Servicing Fee that constitutes
reasonable servicing compensation within the meaning of the REMIC Provisions.
"Trustee": Norwest Bank Minnesota, National Association, its successor in
interest, or any successor trustee appointed as herein provided.
"Trustee Fee": The fee designated as such and payable to the Trustee
pursuant to Section 8.05.
"Trustee Fee Rate": 0.004% per annum.
"Trustee Liability": As defined in Section 8.05(b).
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"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 as of the
commencement of the Collection Period 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 Distributable 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 REMIC II Remittance Rate, accrued
on the Uncertificated Principal Balance of such REMIC II Regular Interest
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 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. As of the Cut-Off Date, the Uncertificated Principal
Balance of each REMIC II Regular Interest shall equal the Original Class
Principal Balance of the corresponding Class of REMIC III Certificates. On each
Distribution Date, the Uncertificated Principal Balance of each REMIC II 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
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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 such Realized Losses and Additional Trust Fund Expenses
deemed to have been allocated thereto on such Distribution Date pursuant to
Section 4.04(c).
"Underwriters": Merrill Lynch and Daiwa Securities America Inc.
"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 is includible in gross income for United States federal income tax
purposes regardless of its source, 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, all within the meaning of Section 7701(a) of the Code.
"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 Sequential Pay 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 any of the Master Servicer, the Special Servicer
and any Affiliate thereof is the holder of any Certificate, neither the Master
Servicer, the Special Servicer nor any Affiliate thereof, in its capacity as a
Certificateholder, shall have Voting Rights with respect to matters concerning
compensation affecting the Master Servicer or the Special Servicer. The Class
IO, Class R-I, Class R-II, Class R-III and Class L Certificates shall not have
any Voting Rights.
"Watch List": As of each Determination Date a report, substantially in the
form of Exhibit O attached hereto, identifying each Mortgage Loan that is not a
Specially Serviced Mortgage Loan (i) with a Debt Service Coverage Ratio of less
than 1.05, (ii) that has a Stated Maturity Date occurring in the next sixty
days, (iii) that is delinquent in its real estate taxes, (iv) for which any
outstanding Advances exits, (v) that has been a Specially Serviced Mortgage Loan
in the past 90 days, (vi) for which the Debt Service Coverage Ratio has
decreased by more than 10% in the prior 12 months, (vii) for which any lease
relating to more than 25% of the related Mortgaged Property has expired, been
terminated, is in default or will expire within the next three months, (viii)
that is late in making its Monthly Payment three or more times in the preceding
twelve months, (ix) that the related Mortgagor has material deferred maintenance
for the related Mortgaged Property or (x) that is 30 or more days delinquent.
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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 eight decimal places, of the respective REMIC I
Remittance Rates in respect of all of the REMIC I Regular Interests as of the
commencement of the related Collection Period, 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 Trust
Fund, without recourse, for the benefit of the Certificateholders (and for the
benefit of the other parties to this Agreement as their respective interests may
appear) all the right, title and interest of the Depositor, in, to and under (i)
the Mortgage Loans, (ii) each of the Mortgage Loan Purchase Agreements and (iii)
all other assets included or to be included in the Trust Fund. 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 and the Special 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 45 days following the later of
the Closing Date or the delivery of such assignments and UCC Financing
Statements to the Custodian) 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 timely delivered to
the Custodian in final, recordable form, 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 clause (iv) of the
definition of "Mortgage File" and each UCC-2 and UCC-3 assignment in favor of
the Trustee and so 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 or its
designee following recording, and each such UCC-2 and UCC-3 assignment shall
reflect that the file copy thereof should be returned to the Custodian or its
designee following filing (and the Custodian shall forward a copy of each
document to the Master Servicer upon receipt); provided, that in those instances
where the public recording office retains the original assignment of Mortgage or
assignment of Assignment of Leases, the
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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 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 the Trust Fund 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 the Trust Fund, 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 the Trust Fund, 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, the Trustee 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, the Trustee 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 forty-five (45) 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 actually known by
a Responsible Officer of
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the Trustee to be required, clauses (vi) and (viii) 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 appear to 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 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 45 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, the
Trustee 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) through (v) and (vii)
and, to the extent provided in the related Mortgage File, clauses (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 appear to 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 or the value of
the affected Mortgage Loan, such party shall give prompt written notice to the
other parties hereto and to the Rating Agencies. Promptly upon becoming aware of
any such Document Defect or Breach
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(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 (or, in the case of a Document Defect or Breach relating to a Mortgage
Loan not being a "qualified mortgage" within the meaning of the REMIC
Provisions, not later than 90 days of any party to this Agreement discovering
such Document Defect or Breach), if such Document Defect or Breach shall
materially and adversely affect the value of the related Mortgage Loan or the
interest of the Certificateholders therein, 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 (other than omissions solely due to a document not
having been returned by the related recording office) cannot be cured within
such 90-day period, repurchase the affected Mortgage Loan at the applicable
Purchase Price not later than the end of such 90-day period 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,
such Document Defect or Breach does not relate to the Mortgage Loan not being
treated as a "qualified mortgage" within the meaning of the REMIC Provisions,
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 (or,
failing such cure, to repurchase the related Mortgage Loan); 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. For a period of two years from the Closing Date, so
long as there remains any Mortgage File as to which there is any uncured
Document Defect and so long as the related Mortgage Loan Seller shall provide
the Officer's Certificate described above as to the reasons such Document Defect
remains uncured and as to the actions being taken to pursue cure, the Trustee
shall on a quarterly basis prepare and deliver to the other parties a written
report as to the status of such uncured Document Defects; provided, however,
that if such Document Defect shall materially and adversely affect the value of
such Mortgage Loan or the interests of the holders of the Certificate therein,
the Mortgage Loan Seller shall in all cases on or prior to the second
anniversary of the Closing Date either cause such Document Defect to be cured or
repurchase the affected Mortgage Loan. 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 or the Trustee, as the case may be, in carrying out its duties pursuant
to this Section 2.03 shall constitute a Servicing Advance; provided, however,
that the Master Servicer or the Trustee, as the case may be,
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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 any powers of attorney that are prepared and delivered
to the Trustee by the Master Servicer and are necessary to permit the Master
Servicer to do so. The Master Servicer shall indemnify the Trustee for any
reasonable costs, fees, 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, 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 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.
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(iii) No consent, approval or authorization of or designation,
declaration, notice or filing with any governmental authority, corporation,
person or firm on the part of the Depositor is required in connection with
the valid execution and delivery of this Agreement or the consummation of
any other transactions contemplated hereby.
(iv) 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.
(v) 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.
(vi) 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.
(vii) The transfer of the Mortgage Loans to the Trust Fund as
contemplated herein requires no regulatory approval, other than any such
approvals as have been obtained, and is not subject to any bulk transfer or
similar law in effect in any applicable jurisdiction.
(viii) No litigation is pending or, to the best of the Depositor's
knowledge, threatened against the Depositor that, if determined adversely
to the Depositor, would prohibit the Depositor from entering into this
Agreement or, in the Depositor's good faith and reasonable judgment, is
likely to materially and adversely affect either the ability of the
Depositor to perform its obligations under this Agreement or the financial
condition of the Depositor.
(ix) Immediately prior to the transfer of the 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;
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and (B) the Depositor has full right and authority to sell, assign and
transfer the Mortgage Loans.
(x) 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 and to the Rating Agencies.
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, in its capacity as
Trustee, of the assets included in the Trust Fund. Concurrently with such
assignment and in exchange therefor, (a) the Trustee agrees to hold a portion of
each of the Mortgage Loans (other than Additional Interest) as part of REMIC I
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
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 Trust Fund for the benefit of the respective Holders of the
REMIC II Regular Interests and the Class R-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 the REMIC II Regular Interests and the Class R-II
Certificates.
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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 written
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 Trust Fund for the benefit of the Holders of the REMIC III
Certificates. The Trustee acknowledges the assignment to it of the REMIC II
Regular Interests and declares that it holds and will hold the same in trust for
the exclusive use and benefit of all present and future Holders of the REMIC III
Certificates.
SECTION 2.09. 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 written 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.
SECTION 2.10. Execution, Authentication and Delivery of Class L
Certificates.
The Certificate Registrar has executed, and the Trustee, as the
Authenticating Agent, has authenticated and delivered to or upon the written
order of the Depositor, the Class L Certificates evidencing the entire
beneficial ownership of the Additional Interest. The rights of the holders of
the Class L Certificates to receive distributions from the proceeds of the
Additional Interest in respect of their Class L Certificates, and all ownership
interests evidenced or constituted by the Classes of L 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 Trust Fund, for the benefit of the
Certificateholders, in accordance with any and all applicable laws, the terms of
this Agreement and the terms 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 each Specially Serviced Mortgage Loan and REO Property and shall
render such services with respect to all Mortgage Loans and REO Properties as
are specifically provided for herein. 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), the Master Servicer and the Special
Servicer, subject to Section 6.09, each shall have full power and authority,
acting alone, to do or cause to be done any and all things in connection with
such servicing and administration which it may deem necessary or desirable.
Without limiting the generality of the foregoing, each of the 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 execute any limited powers of attorney and other documents
furnished by the Master Servicer or the Special Servicer that are necessary or
appropriate to enable them to carry out their servicing and administrative
duties hereunder. The Master Servicer shall indemnify the Trustee for any
reasonable costs, fees, 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) 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.
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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 default 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 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 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, late charges, Prepayment Premiums and default interest; fifth, as a
recovery of any remaining principal of such Mortgage Loan to the extent of its
entire remaining unpaid principal balance; and sixth, with respect to any ARD
Mortgage Loan after its Anticipated Repayment Date, as a recovery of any
interest to accrue on such ARD Mortgage Loan at a rate in excess of the related
Mortgage Rate. All amounts collected on any Mortgage Loan in the form of
Liquidation Proceeds of the nature described in clauses (iv) through (vi) of the
definition thereof shall be deemed to be applied: first, as a recovery of any
related and unreimbursed 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 to
but not including the Due Date in the Collection Period of receipt; 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; and fourth, with respect to any ARD Mortgage Loan after its Anticipated
Repayment Date, as a recovery of any interest to accrue on such ARD Mortgage
Loan at a rate in excess of the related Mortgage Rate. No such amounts shall be
applied to the items constituting additional servicing compensation as described
in the first sentence of Section 3.11(b) or 3.11(d) unless and until all
principal and interest then due and payable on such
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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 on any
Mortgage Loan shall not alter in any way the right of the Master Servicer, the
Special Servicer, the Trustee or any other Person to receive payments from the
Certificate Account as set forth in clauses (ii) through (xiv) of Section
3.05(a) from amounts so applied.
(c) With respect to an ARD Mortgage Loan, notwithstanding any provision
herein to the contrary, the Master Servicer or the Special Servicer, as the case
may be, shall have the authority, subject to Section 3.20 hereof, to waive or
otherwise modify any Additional Interest due and accruing if the related
Mortgagor demonstrates (to the satisfaction of the Master Servicer or the
Special Servicer) its ability to prepay the entire principal balance of the
related ARD Mortgage Loan and accrued and unpaid interest thereon at the
applicable Mortgage Rate, any related and unreimbursed Servicing Advances plus
any interest thereon and any Additional Trust Fund Expenses in respect of such
Mortgage Loan.
SECTION 3.03. Collection of Taxes, Assessments and Similar Items; Servicing
Accounts; Reserve Accounts.
(a) The Master Servicer shall, as to all 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. 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 Escrow Payments and comparable items; (ii) reimburse the
Master Servicer, the Trustee or the Special Servicer for any Servicing Advances;
(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; (v) pay itself interest and investment income on balances
in the Servicing Account as described in Section 3.06(b), if and to the extent
not required by law or the terms of Mortgage Loan to be paid to the Mortgagor;
or (vi) clear and terminate the Servicing Account at the termination of this
Agreement in accordance with Section 9.01. To the extent permitted by law or the
applicable Mortgage Loan, funds in the Servicing Accounts may be invested only
in Permitted Investments in accordance with the provisions of Section 3.06. 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 shall, as to all Mortgage Loans, (i)
maintain accurate records with respect to the related Mortgaged Property
reflecting the status of real estate taxes, assessments and other similar items
that are or may become a lien thereon and the status of insurance premiums and
any ground rents payable in respect thereof and (ii) use
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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 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 all Mortgage
Loans, enforce the requirement of the related Mortgage that the Mortgagor make
payments in respect of such items at the time they first become due.
(c) The Master Servicer shall, as to all Mortgage Loans, 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), and (iii) premiums on Insurance Policies, in each instance if and
to the extent Escrow Payments (if any) collected from the related Mortgagor are
insufficient to pay such item when due and the related Mortgagor has failed to
pay such item on a timely basis, and provided that the particular Servicing
Advance would not, if made, constitute a Nonrecoverable Servicing 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). 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 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 ability to
charge and collect from the Mortgagor such costs together with interest thereon.
If the Master Servicer or Special Servicer is required under any provision
of this Agreement (including, but not limited to, this Section 3.03(c)) to make
a Servicing Advance, but neither does so within 15 days after such Advance is
required to be made, the Trustee shall, if a Responsible Officer of the Trustee
has actual knowledge of such failure on the part of the Master Servicer or
Special Servicer, as the case may be, give written notice of such failure, as
applicable, to the Master Servicer or the Special Servicer. If such Servicing
Advance is not made by the Master Servicer or the Special Servicer within three
Business Days after such notice then (subject to a determination that such
Servicing Advance would not be a Nonrecoverable Servicing Advance) the Trustee
shall make such Servicing Advance. Any failure by the Master Servicer or the
Special Servicer to make a Servicing Advance hereunder shall constitute an Event
of Default by the Master Servicer or the Special Servicer, as the case may be,
subject to and as provided in Section 7.01.
(d) In connection with its recovery of any Servicing Advance from
the Certificate Account pursuant to Section 3.05(a), each of the Master
Servicer, the Special Servicer and the Trustee shall be entitled to receive, out
of any amounts then on deposit in the Certificate Account, any unpaid interest
at the Reimbursement Rate in effect from time to
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time, compounded annually, 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, the Special Servicer or the Trustee, as
appropriate and in accordance with Section 3.05(a), for any Servicing Advance as
soon as practicable after funds available for such purpose are deposited in the
Certificate Account.
(e) The determination by either the Master Servicer, the Trustee or the
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, 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; which appraisal shall 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 and conducted in accordance with the standards of the
Appraisal Institute performed pursuant to Section 3.09(a) by 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. The Trustee shall be entitled to rely, conclusively, on any
determination by the Master Servicer or the Special Servicer that a Servicing
Advance, if made, would be a Nonrecoverable Advance; provided, however, that if
the Master Servicer or the Special Servicer has failed to make a Servicing
Advance for reasons other than a determination by the Master Servicer or the
Special Servicer, as applicable, that such Servicing Advance would be a
Nonrecoverable Advance, the Trustee shall make such Servicing Advance within the
time periods required by Section 3.03(c) unless the Trustee, in good faith,
makes a determination that such Servicing Advance would be a Nonrecoverable
Advance.
(f) The Master Servicer shall, as to all 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 (i) 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 and (ii) to pay the
Master Servicer interest and investment income earned on amounts in the Reserve
Accounts as described below. To the extent permitted in the applicable Mortgage,
funds in the Reserve Accounts may be invested in Permitted Investments in
accordance with the provisions of Section 3.06. All Reserve Accounts shall be
Eligible Accounts. The Reserve Accounts
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shall not be considered part of the segregated pool of assets comprising REMIC
I, REMIC II or REMIC III. Consistent with the Servicing Standard, the Master
Servicer may waive or extend the date set forth in any agreement governing such
Reserve Accounts by which the required repairs and/or capital improvements at
the related Mortgaged Property must be completed if the related Mortgagor is
diligently undertaking such repairs or capital improvements.
SECTION 3.04. Certificate Account and 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 shall deposit or cause to be
deposited in the Certificate Account, within one Business Day of receipt of
available funds (in the case of payments by Mortgagors or other collections on
the Mortgage Loans) or as otherwise required hereunder, the following payments
and collections received or made by 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 Additional 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; and
(vii) any amounts required to be transferred from an REO Account
pursuant to Section 3.16(c).
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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, amounts to be deposited in Reserve Accounts, and
amounts that the Master Servicer and the Special Servicer are entitled to retain
as additional servicing compensation pursuant to Sections 3.11(b) and (d), 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 Sections 3.11(b) and (d) assumption
fees, late charges and other transaction fees received by the Master Servicer to
which the Special Servicer is entitled pursuant to either of such Sections 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, 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 two Business Days 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. All amounts on deposit in the Distribution
Account shall remain uninvested.
In addition, the Master Servicer shall, as and when required hereunder,
deliver to the Paying Agent for deposit in the Distribution Account:
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(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
(iv) the Purchase Price paid in connection with the purchase by the
Master Servicer 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 the Holders of the Class L Certificates or their assignees.
The Additional Interest Distribution Account shall be established and maintained
as an Eligible Account as part of the Trust Fund but shall not constitute part
of REMIC I, REMIC II or REMIC III. 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 the Holders of
the Class L Certificates on the first Distribution Date after which there are no
longer any Mortgage Loans outstanding, the Trustee shall terminate the
Additional Interest Distribution Account. All amounts on deposit in the
Additional Interest Distribution Account shall remain uninvested.
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);
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(ii) to reimburse the Trustee and itself, in that order, for
unreimbursed P&I Advances, the Master Servicer's right to reimburse the
Trustee and itself, in that order, pursuant to this clause (ii) with
respect to any P&I Advance (other than Nonrecoverable Advances, which are
reimbursable pursuant to clause (vii) below) being limited to, amounts that
represent Late Collections of interest (net of the related Master 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 Master 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, out of general collections on the
Mortgage Loans and any REO Property, earned and unpaid Special Servicing
Fees in respect of each Specially Serviced Mortgage Loan and REO 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,
Special Servicer or Depositor pursuant to Section 9.01);
(vi) to reimburse the Trustee first and then itself and the Special
Servicer on a pari passu basis for any unreimbursed Servicing Advances, the
Trustee's, the Master Servicer's or Special Servicer's right, as the case
may be, 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 from the Liquidation
Proceeds, Insurance Proceeds and, if applicable, REO Revenues received in
respect of the
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particular Mortgage Loan or REO Property as to which such Servicing Advance
was made;
(vii) to reimburse the Trustee first, and then itself and the Special
Servicer on a pari passu basis, for any unreimbursed Advances that have
been determined to be Nonrecoverable Advances or to pay, with respect to
any Mortgage Loan or REO Loan as to which a Final Recovery Determination
has been made, any related earned Master Servicing Fee to itself, that
remained unpaid in accordance with clause (iii) above;
(viii) at such time as it reimburses itself, the Special Servicer or
the Trustee for any unreimbursed Advance pursuant to clause (ii), (vi) or
(vii) above or reimburses the Special Servicer pursuant to Section 3.09 for
any unreimbursed Servicing Advance, to pay the Trustee first, and then
itself and the Special Servicer on a pari passu basis, out of general
collections on the Mortgage Loans and any REO Properties, any interest
accrued and payable thereon in accordance with Section 3.03(d) or 4.03(d),
as applicable;
(ix) to pay, out of general collections on the Mortgage Loans and any
REO Property, 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, out of general collections on the Mortgage Loans and any
REO Properties, 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, out of general collections on the Mortgage Loans and any
REO Properties, 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, out of general collections on the Mortgage Loans and
any REO Properties, 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
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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.
The Master Servicer shall keep and maintain separate accounting records, on
a loan-by-loan and property-by-property basis in the case of REO Property 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) or the Trustee from the
Certificate Account amounts permitted to be paid to the Special Servicer (or to
such third-party contractors) or the Trustee therefrom promptly upon receipt of
a certificate of a Servicing Officer of the Special Servicer or of a Responsible
Officer of the Trustee, as the case may be, describing the item and amount to
which the Special Servicer (or such third-party contractors) or the Trustee 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 an
Advance, the Trustee shall 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 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) [RESERVED]
(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
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Organization", (B) as contemplated by Section 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;
(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; and
(viii) 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 Servicing Accounts, the Reserve
Accounts, the Certificate Account and the REO Account.
(a) The Master Servicer may direct in writing any depository
institution maintaining a Servicing Account, a Reserve Account or the
Certificate 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, unless payable
on demand, no later than the Business Day immediately preceding the next
succeeding date on which such funds are required to be withdrawn from such
account pursuant to this Agreement. In the event that the Master Servicer shall
have failed to give investment directions for any Servicing Account, any Reserve
Account or the Certificate Account (exclusive of any accounts as are held by the
Master Servicer) 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 held in the REO account shall
be invested in securities described in clause (i) of the definition of the term
"Permitted Investments"; and such funds held in such other accounts shall be
invested in securities described in clause (v) of such definition. 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 Servicing Accounts, the Reserve Accounts
and the Certificate Account) and the Special Servicer (with respect to Permitted
Investments of amounts in the REO Account), on behalf of
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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 (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, Servicing Accounts and
Reserve Accounts), 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
any of the Servicing Accounts, the Reserve Accounts or the Certificate 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 3.03(a), 3.03(f) or
3.05(a), 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 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 Servicing Accounts and the Reserve
Accounts) 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 and the Special Servicer or the Master Servicer fails to deposit any
losses with respect to such Permitted Investment pursuant to Section 3.06(b),
the Trustee may and, subject to Section 8.02, upon the written
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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 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 (with respect to Mortgage Loans other than
Specially Serviced Mortgaged Loans) and the Special Servicer (with respect to
Specially Serviced Mortgage Loans) shall, consistent with the Servicing
Standard, 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 exercise its reasonable best efforts to obtain
the required insurance coverage from Qualified Insurers that have a "claims
paying ability" rating of at least "A" from Standard & Poor's and a comparable
rating from at least one other nationally recognized statistical rating agency.
The Majority Subordinate Certificateholder may request that earthquake insurance
be secured by the Master Servicer or the Special Servicer, as applicable, for
one or more Mortgaged Properties at the expense of the Majority Subordinate
Certificateholder. 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" and "A2" from Standard & Poor's and Moody's, respectively (if then
rated by Moody's) (or Standard & Poor's and a comparable rating from one other
nationally recognized statistical rating agency, if such insurer is not 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. 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 Trust Fund; in each case such insurance shall
be issued by an insurer authorized under applicable law to issue such insurance.
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
lessors, as the case may be, and in
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each case in accordance with the terms of the related Mortgage and 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 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" and "A2"
or better from Standard & Poor's and Moody's, respectively (or Standard & Poor's
and a comparable rating from one other nationally recognized statistical rating
agency, if such insurer is not rated by Moody's) or such lower rating of any
Rating Agency or rating from any other 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" and "Aa3" or better from Standard & Poor's and Moody's (if then rated by
Moody's) respectively, or such lower rating of any Rating Agency or rating from
any other 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, such fidelity bond
to 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 cause the qualification, downgrading or withdrawal of any rating
assigned by any Rating Agency to the Certificates (as evidenced in writing from
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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" and "Aa3" or better
from 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, 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, 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, are rated at least "A" or the equivalent
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 all Mortgage Loans, the Special Servicer, on behalf of the
Trustee as the mortgagee of record, shall, to the extent permitted by applicable
law, 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 Special Servicer has determined,
consistent with the Servicing Standard, that waiver of such restrictions would
be in accordance with the Servicing Standard. Promptly after the Special
Servicer has made any such determination, the Special Servicer shall deliver to
the Trustee, the Rating Agencies and the Master Servicer an Officers'
Certificate setting forth the basis for such determination. Neither the Master
Servicer nor the Special Servicer shall (a) exercise any such waiver in respect
of a due-on-encumbrance provision for any Mortgage Loan or (b)
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exercise a due on sale provision for any Mortgage Loan that had a Cut-Off Date
Balance in excess of 5% of the aggregate Cut-Off Date Balances of all Mortgage
Loans without receiving the prior written confirmation from the Rating Agencies
that such action would not result in a downgrading, qualification or withdrawal
of the ratings then assigned to the Certificates.
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), 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 advance all costs and expenses (other than costs or expenses that
would, if incurred, constitute a Nonrecoverable Servicing Advance) incurred by
it in any such proceedings, and shall be entitled to reimbursement therefor as
provided in 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 by an Independent Appraiser or other expert in
real estate matters; which Appraisal shall 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. With respect to each Required
Appraisal Mortgage Loan, the Special Servicer will be required to obtain a
Required Appraisal within 60 days of a Mortgage Loan becoming a Required
Appraisal Mortgage Loan (unless an appraisal meeting the requirements of a
Required Appraisal was obtained for such Required Appraisal Mortgage Loan within
the prior 3 months in which case such appraisal shall be the Required Appraisal)
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 Special Servicer shall advance the cost of such Required Appraisal;
provided, however, that such expense will be subject to reimbursement to the
Special Servicer as a Servicing Advance out of the Certificate Account pursuant
to Section 3.05(a).
(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 Trust Fund,
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, 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 which was performed by
an Independent Person who regularly conducts Environmental Assessments and which
was performed within six months prior to any such acquisition of title or other
action (a copy of such Environmental Assessment shall be delivered to the
Trustee and the Master Servicer), 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
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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
with respect to the affected Mortgaged Property.
The Special Servicer shall undertake, in good faith, reasonable efforts to
make the determination referred to in the preceding paragraph and may
conclusively rely on the Environmental Assessment referred to above in making
such determination. The cost of any such 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, may be reimbursed to
the Special Servicer from the Certificate Account as a Servicing Advance; and if
any such Environmental Assessment so warrants, the Special Servicer shall, as a
Servicing Advance, 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.
(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) of the
first sentence thereof has not been satisfied with respect to any Mortgaged
Property securing a defaulted Mortgage Loan, the Special Servicer shall take
such action as is in accordance with the Servicing Standard (other than
proceeding against the Mortgaged Property) and, at such time as it deems
appropriate, may, on behalf of the 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 and the
Trustee 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 (i)
and (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
Mortgage Loan or REO Property and the basis thereof. Each Final Recovery
Determination shall be evidenced by an Officers' Certificate delivered to the
Trustee and the Master Servicer 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 in writing 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. No expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall 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 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
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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
stated by the Special Servicer to be 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 Master 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 Master Servicing Fee shall accrue at the
related Master Servicing Fee Rate and on the same principal amount and in the
same manner respecting which the related interest payment due on such Mortgage
Loan or deemed to be due on such REO Loan is computed. The Master 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 Master 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 unpaid Master
Servicing Fees in respect of any Mortgage Loan or REO Loan out of that portion
of related Insurance Proceeds or Liquidation Proceeds
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allocable as recoveries of interest, to the extent permitted by Section
3.05(a)(iii). The right to receive the Master 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 (i) late charges,
default interest, assumption application fees, modification fees for Mortgage
Loan modifications made pursuant to Section 3.20(i), 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, and (ii) fifty percent (50%) of any
assumption fee to the extent actually paid by a Mortgagor with respect to any
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) and (ii)
interest and other income earned on the Certificate Account and to the extent
not required to be paid to any Mortgagor under applicable law, interest or other
income earned on deposits in the Reserve Accounts and the Servicing Accounts 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).
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 same principal amount and
in the same manner respecting which the related interest payment due on such
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,
Corrected Mortgage Loan and REO Loan, the Special Servicer shall be entitled to
the Principal Recovery Fee payable out of, and 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
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Mortgage Loan (or, in the case of an REO Loan, in respect of the related REO
Property) and allocable as a recovery of principal in accordance with Section
3.02(b) or the definition of "REO Loan", as applicable; provided that 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 Depositor, the Master Servicer, the
Special Servicer or the Majority Subordinate Certificateholder 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 the
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 (i) late charges,
default interest, assumption application fees, 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 Specially Serviced
Mortgage Loan, (ii) fifty percent (50%) of assumption fees collected on all
Mortgage Loans and (iii) one hundred percent (100%) of modification fees
collected on all Mortgage Loans other than modifications made by the Master
Servicer pursuant to Section 3.20(i), in each case to the extent actually paid
by the related Mortgagor, shall be retained by the Special Servicer or 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 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
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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
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 at its expense perform or cause to be
performed a physical inspection of a Mortgaged Property as soon as practicable
after a related Mortgage Loan becomes a Specially Serviced Mortgage Loan and, in
any event, shall at its expense perform or cause to be performed an inspection
of all the Mortgaged Properties at least once per calendar year (or in the case
of Mortgage Loans with an initial principal balance of less than $3,000,000,
every other calendar year), if the Special Servicer has not already done so in
that calendar year pursuant to the preceding sentence. The Special Servicer
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 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. The Special
Servicer shall make copies of all such inspection reports available for review
by Certificateholders and Certificate Owners during normal business hours at the
offices of the Special Servicer at all times after a date no later than 30 days
of the related inspection. The Special Servicer shall forward copies of any such
inspection reports to the applicable Sub Servicer, the Master Servicer and the
Trustee upon request.
The Special Servicer will, promptly (but in no event later than 60 days)
after a Mortgage Loan becomes a Specially Serviced Mortgage Loan, give written
notice to each Rating Agency, 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.
(b) Not later than 2:00 P.M. on the second Business Day prior to each
Determination Date, the Special Servicer shall deliver or cause to be delivered
to the Master Servicer the following reports with respect to the Mortgage Loans
(and, if applicable, the related REO Properties) providing the required
information as of the end of the preceding calendar month: (i) a CSSA Property
File Report; (ii) a Comparative Financial Status Report; (iii) a NOI Adjustment
Worksheet and (iv) an Operating Statement Analysis. Not later than 2:00 P.M. on
the second Business Day following each Determination Date, the Special Servicer
shall deliver or cause to be delivered to the Master Servicer the following
reports with respect to the Mortgage Loans (and, if applicable, the related REO
Properties) providing the required information as of such Determination Date:
(i) a Historical Loss Estimate Report; (ii) a Historical Loan Modification
Report; (iii) an REO Status Report; and (iv) a Watch List Report.
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(c) Not later than 12:00 Noon on the third Business Day after each
Determination Date, the Master Servicer shall deliver or cause to be delivered
to the Trustee (A) the following reports with respect to the Mortgage Loans
(and, if applicable, the related REO Properties) providing the required
information as of the end of the preceding calendar month: (i) the CSSA Property
File Report received from the Special Servicer pursuant to Section 3.12(b); (ii)
the Comparative Financial Status Report received from the Special Servicer
pursuant to Section 3.12(b); (iii) the NOI Adjustment Worksheet received from
the Special Servicer pursuant to Section 3.12(b) and (iv) the Operating
Statement Analysis received from the Special Servicer pursuant to Section
3.12(b) and (B) the following reports with respect thereto providing the
required information as of such Determination Date: (i) the Delinquent Loan
Status Report; (ii) the Historical Loss Estimate Report received from the
Special Servicer pursuant to Section 3.12(b); (iii) the Historical Loan
Modification Report received from the Special Servicer pursuant to Section
3.12(b); (iv) the REO Status Report received from the Special Servicer pursuant
to Section 3.12(b); (v) a Watch List Report; and (vi) a Loan Payoff Notification
Report.
(d) The Special Servicer will deliver to the Master Servicer the reports
set forth in Section 3.12(b) and the Master Servicer shall deliver to the
Trustee the reports set forth in Section 3.12(c) in an electronic format
reasonably acceptable to the Special Servicer and the Master Servicer with
respect to the reports set forth in Section 3.12(b), and the Master Servicer and
the Trustee with respect to the reports set forth in Section 3.12(c). The Master
Servicer may, absent manifest error, conclusively rely on the reports to be
provided by the Special Servicer pursuant to Section 3.12(b). The Trustee may,
absent manifest error, conclusively rely on the reports to be provided by the
Master Servicer pursuant to Section 3.12(c). In the case of information or
reports to be furnished by the Master Servicer to the Trustee pursuant to
Section 3.12(c), to the extent that such information is based on reports to be
provided by the Special Servicer pursuant to Section 3.12(b) and to the extent
that such reports are to be prepared and delivered by the Special Servicer
pursuant to Section 3.12(b), the Master Servicer shall have no obligation to
provide such information or reports until it has received such information or
reports from the Special Servicer and the Master Servicer shall not be in
default hereunder due to a delay in providing the reports required by Section
3.12(c) caused by the Special Servicer's failure to timely provide any report
required under Section 3.12(b) of this Agreement.
The Special Servicer shall, consistent with the Servicing Standard,
endeavor to obtain quarterly and annual operating statements and rent rolls with
respect to each of the Mortgage Loans and REO Properties, which efforts shall
include in the case of Mortgage Loans, a letter sent to the related Mortgagor
each quarter (followed up with telephone calls) requesting such quarterly and
annual operating statements and rent rolls until they are received to the extent
such action is consistent with applicable law. With respect to each Mortgaged
Property and REO Property the Special Servicer will prepare and deliver an
Operating Statement Analysis as set forth in Section 3.12(b) for the related
Mortgaged Property or REO Property for or as of the end the prior calendar month
together with copies of the operating statements and rent rolls for the related
Mortgaged Property or REO Property.
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Within ten days after receipt by the Special Servicer of any annual
operating statements with respect to any Mortgaged Property or REO Property, the
Special Servicer shall prepare or update an NOI Adjustment Worksheet for such
Mortgaged Property or REO Property (with the annual operating statements
attached thereto as an exhibit).
The Special Servicer shall maintain one Operating Statement Analysis report
for each Mortgaged Property and REO Property. The Operating Statement Analysis
report for each Mortgaged Property is to be updated by the Special Servicer and
such updated report shall be delivered in electronic format to the Trustee
within thirty days after receipt by the Special Servicer of updated operating
statements for such Mortgaged Property. The Special Servicer will use the
"Normalized" column from the NOI Adjustment Worksheet to update the Operating
Statement Analysis report and will use any operating statements received with
respect to any Mortgaged Property to update the Operating Statement Analysis
report for such Mortgaged Property, such updates to be completed in electronic
format and delivered to the Trustee within thirty days after receipt of the
necessary information.
SECTION 3.13. Annual Statement as to Compliance.
Each of the Master Servicer and the Special Servicer shall deliver to the
Trustee, the Underwriters, and the Rating Agencies, and, in the case of the
Special Servicer, to the Master Servicer, on or before April 30 of each year,
beginning April 30, 1999, 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 April 30 of each year, beginning April 30, 1999 each of the
Master Servicer and the Special Servicer at its expense 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,
the Underwriters, the Rating Agencies, 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
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Closing Date through December 31, 1998) 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.
(a) Upon ten days prior written notice, the Master Servicer (with respect
to the items in clauses (a), (b), (c), (d) and (h) below), the Special Servicer
(with respect to the items in clauses (e), (f), (g), (h) and (i) below) and the
Trustee to the extent any such items are in its possession, shall make available
at their respective offices primarily responsible for administration of the
Mortgage Loans (or in the case of Norwest Bank Minnesota, National Association,
at its Corporate Trust Office, except with respect to item (g), which will be
maintained at its offices in New York or Minnesota), during normal business
hours, for review by any Certificateholder or any person identified by a Holder
or its designated agent in writing to the Trustee, the Master Servicer or the
Special Servicer, as the case may be, as a prospective transferee of such an
interest, the Trustee, the Rating Agencies, the Underwriters and anyone
specified thereby and the Depositor originals or copies of the following items:
(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 and all reports, statements and analyses delivered by the Master
Servicer since the Closing Date pursuant to Section 3.12(c), (c) all Officers'
Certificates delivered by the Master Servicer since the Closing Date pursuant to
Section 3.13, (d) all accountants' reports delivered to the Master 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 in
respect of each Mortgaged Property and delivered to the Master Servicer, (f) the
most recent Mortgaged Property annual operating statements and rent roll, if
any, collected by or on behalf of the Special Servicer and delivered to the
Master Servicer, (g) any and all modifications, waivers and amendments of the
terms of a Mortgage Loan entered into by the Special Servicer, (h) any and all
Officers' Certificates and other evidence delivered by the Master Servicer or
the Special Servicer, as the case may be, to support its determination that any
Advance was or, if made, would be a Nonrecoverable Advance, and (i) any
operating statements, budgets, rent rolls or financial statements. Copies of any
and all of the foregoing items will be available from the Master Servicer or the
Special Servicer, as the case may be, upon request at the expense of the
requesting party and shall be provided to any of the Rating Agencies at no cost
pursuant to any of their requests.
In connection with providing access to or copies of the items described in
the preceding paragraph pursuant to this Section 3.15, the Trustee shall
require: (a) in the case of Certificate Owners, a confirmation executed by the
requesting Person substantially in the form
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of Exhibit W-1 hereto (or such other form as may be reasonably acceptable to the
Trustee) generally to the effect that such Person is a beneficial holder of
Book-Entry Certificates and, subject to the last sentence of this paragraph,
will keep such information confidential (except that such Certificate Owner may
provide such information to any other Person that holds or is contemplating the
purchase of any Certificate or interest therein, provided that such other Person
confirms in writing such ownership interest or prospective ownership interest
and agrees to keep such information confidential); and (b) in the case of a
prospective purchaser of a Certificate or an interest therein, confirmation
executed by the requesting Person substantially in the form of Exhibit W-2
hereto (or such other form as may be reasonably acceptable to the Trustee)
generally to the effect that such Person is a prospective purchaser of a
Certificate or an interest therein, is requesting the information for use in
evaluating a possible investment in Certificates and, subject to the last
sentence of this paragraph, will otherwise keep such information confidential.
The Holders of the Certificates, by their acceptance thereof, will be deemed to
have agreed, subject to the last sentence of this paragraph, to keep such
information confidential (except that any Holder may provide such information
obtained by it to any other Person that holds or is contemplating the purchase
of any Certificate or interest therein, provided that such other Person confirms
in writing such ownership interest or prospective ownership interest and agrees
to keep such information confidential). Notwithstanding the foregoing, no
Certificateholder, Certificate Owner or prospective Certificateholder or
Certificate Owner shall be obligated to keep confidential any information
received from the Trustee pursuant to this Section 3.15 that has previously been
made available via the Trustee's Internet Website or has previously been filed
with the Commission, and the Trustee shall not require either of the
certifications contemplated by the second preceding sentence in connection with
providing any information pursuant to this Section 3.15 that has previously been
made available via the Trustee's Internet Website or has previously been filed
with the Commission.
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 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 or the Special Servicer, as the case may be, designated by it.
The Trustee, the Master Servicer, the Special Servicer and the Underwriters
may require payment from the Certificateholder 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.
(b) The Trustee will make available each month, to any interested party,
the Distribution Date Statement via the Trustee's Internet Website, electronic
bulletin board and
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fax-on-demand service. In addition, pursuant to the terms of one or more written
agreements (each an "Internet Disclosure Agreement") that may be entered into
after the date hereof, between the Depositor on the one hand and the Trustee or
the Master Servicer on the other hand, the Trustee or the Master Servicer, as
the case may be, may make available certain information, reports and documents
with respect to the Mortgage Loans and the transactions contemplated hereby,
including, without limitation, the CSSA Loan File Report, the CSSA Property File
Report and the reports contemplated by Section 3.12(c), on the Trustee's or the
Master Servicer's internet website. None of the Depositor, the Master Servicer
or the Trustee possesses any obligation to enter an Internet Disclosure
Agreement. The Trustee and the Master Servicer will not post or disclose
information, reports, data files or documents with respect to the Mortgage Loans
and the transactions contemplated hereby unless it is expressly permitted to
post such information pursuant to the terms hereof or pursuant to the terms of
an Internet Disclosure Agreement. Provided that the each of the Master Servicer,
the Special Servicer and the Trustee prepare and disseminate all information and
reports pursuant to the terms of this Agreement, none of the Master Servicer,
the Special Servicer or the Trustee shall be liable for the dissemination of
such information or reports.
If three or more Holders (hereinafter referred to as "Applicants" with a
single Person which (together with its Affiliates) is the Holder of more than
one Class of Certificates being viewed as a single Applicant for these purposes)
apply in writing to the Trustee, and such application states that the
Applicants' desire to communicate with other Holders with respect to their
rights under this Agreement or under the Certificates and is accompanied by a
copy of the communication which such Applicants propose to transmit, then the
Trustee shall, within five Business Days after the receipt of such application,
send, at the Applicants' expense, the written communication proffered by the
Applicants to all Certificateholders at their addresses as they appear in the
Certificate Register.
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 or its nominee on behalf of the
Certificateholders. The Special Servicer, on behalf of the Trust Fund, shall
sell any REO Property by the end of the third year following the calendar year
in which REMIC I acquires ownership of such REO Property for purposes of Section
860G(a)(8) of the Code, unless the Special Servicer either (i) applies, more
than sixty days prior to the end of such third succeeding calendar year, 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
end of such third succeeding calendar year 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
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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 written 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 or such other Person
as may be directed by 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
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
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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 from such review
that:
(i) None of the income from Directly Operating such Mortgaged Property
would be subject to tax as "net income from foreclosure property" within
the meaning of the REMIC Provisions or 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 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
reasonably 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
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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. All
of the REMIC Administrator's expenses (including any fees and expenses of
counsel or other experts reasonably retained by it) incurred pursuant to
this section shall be reimbursed to it from the Trust Fund in accordance
with Section 10.01(f).
The Special Servicer's decision as to how each REO Property shall be
managed and operated shall be based on the Servicing Standard and in any 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 the same manner as would prudent mortgage loan servicers and asset
managers operating acquired mortgaged property comparable to the respective
Mortgaged Property. 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.
(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 or, except as contemplated by Section
3.17(a), either 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:
(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
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Property, the Special Servicer shall 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 Special Servicer
determines, in accordance with the Servicing Standard, that such payment would
be a Nonrecoverable Advance; provided, however, that the Special 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;
(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.
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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),
2.02(b) and 9.01.
(b) Subject to Sections 2.03(a) and 2.02(b), 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,
notify 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 Special Servicer) may at its
option purchase such Mortgage Loan from 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 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 Certificateholders.
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
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10 days. Unless the Special Servicer determines that acceptance of any bid would
not be in the best economic interests of the Certificateholders, the Special
Servicer shall accept the highest cash bid received from any Person that
constitutes a fair price for such Mortgage Loan. In the absence of any bid
determined as provided below to be fair, the Special Servicer shall proceed with
respect to such Defaulted Mortgage Loan in accordance with Section 3.09.
The Special Servicer shall use its best efforts to solicit bids for each
REO Property in such manner as will be reasonably likely to realize a fair price
within the time period provided for by Section 3.16(a). The Special Servicer
shall accept the first (and, if multiple bids are received contemporaneously or
subsequently, the highest, provided that the Special Servicer is not obligated
to the first bidder) 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 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 Master Servicer shall not bid with respect to a Defaulted Mortgage
Loan or REO Property if the Special Servicer has informed it that the Special
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
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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 Master Servicer, 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 for the benefit of the Trust Fund 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 and without representations and warranties of title
and condition, unless liability for breach thereof is limited to recourse
against the Trust Fund, and if such sale is consummated in accordance with the
terms of this Agreement, neither the Special Servicer nor the Trustee shall have
any liability to any Certificateholder with respect to the purchase price
therefor accepted by the Special Servicer.
(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).
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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 Master Servicing Fee received by the Master
Servicer during such Collection Period and all servicing compensation in respect
of default interest and late charges received by the Master Servicer during such
Collection Period.
SECTION 3.20. Modifications, Waivers, Amendments and Consents.
(a) Subject to Sections 3.20(b) through 3.20(g) below, the Special Servicer
may, on behalf of the Trustee for the benefit of the Trust Fund, 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) Except as provided in 3.20(d) and the last sentence of Section 3.02(a),
the Special Servicer, on behalf of the Trustee, shall not agree or consent to
any modification, waiver or amendment of any term of any Mortgage Loan that
would:
(i) affect the amount or timing of any related payment of principal,
interest or other amount (including Prepayment Premiums, but excluding
default interest and 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 Special Servicer at the expense of the related Mortgagor
and upon which the Special Servicer may conclusively rely) of the property
to be released;
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(iv) in the judgment of the Special Servicer, otherwise materially
impair the security for such Mortgage Loan or reduce the likelihood of
timely payment of amounts due thereon.
(d) Notwithstanding Section 3.20(c), but subject to the third paragraph of
this Section 3.20(d), the Special Servicer may (i) reduce the amounts owing
under any Specially Serviced Mortgage Loan by forgiving principal, accrued
interest or any Prepayment Premium, (ii) reduce the amount of the monthly
payment on any Specially Serviced Mortgage Loan, including by way of a reduction
in the related Mortgage Rate, (iii) forbear in the enforcement of any right
granted under any Mortgage Note or Mortgage relating to a Specially Serviced
Mortgage Loan or (iv) accept a principal prepayment on any Specially Serviced
Mortgage Loan during any Lockout Period; provided that (A) the related Mortgagor
is in default with respect to the Specially Serviced Mortgage Loan or, in the
judgment of the Special Servicer, such default is reasonably foreseeable, (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 net
present value basis (the relevant discounting of amounts that will be
distributable to Certificateholders to be performed at the related Mortgage
Rate) and (C) such modification, waiver or amendment would not both (1) effect
an exchange or reissuance of the Mortgage Loan under Section 1001 of the Code
(and the Treasury regulations promulgated thereunder) and (2) 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.
In addition, notwithstanding Section 3.20(c), but subject to the third
paragraph of this Section 3.20(d), the Special Servicer may extend the date on
which any Balloon Payment is scheduled to be due in respect of a Specially
Serviced Mortgage Loan if the conditions set forth in the proviso to the prior
paragraph are satisfied and the Special Servicer has obtained an appraisal in
accordance with the Standards of the Appraisal Institute of the related
Mortgaged Property, performed by an Independent Appraiser, in connection with
such extension, which appraisal supports the determination of the Special
Servicer contemplated by clause (B) of the proviso to the immediately preceding
paragraph.
In no event will the Special Servicer (i) extend the maturity date of a
Mortgage Loan beyond a date that is two years prior to the Rated Final
Distribution Date, (ii) extend the maturity date of any Mortgage Loan which has
a Mortgage Rate below the prevailing interest rate for comparable loans at the
time of such modification as determined by the Special Servicer, unless (A) such
Mortgage Loan is a Balloon Loan, (B) the related Mortgagor has failed to make
the Balloon Payment at its scheduled maturity and (C) such Balloon Loan is not a
Specially Serviced Mortgage Loan (other than by reason of the failure to make
its Balloon Payment) and has not been delinquent with respect to a Monthly
Payment (other than the Balloon Payment) in the preceding twelve months, in
which case the Special Servicer may permit up to three one-year extensions at
the existing Mortgage Rate for such Mortgage Loan (provided that such limitation
of extensions made at below market rate shall not limit the ability of the
Special Servicer to extend the maturity date of any Mortgage Loan at an interest
rate at or in excess to the prevailing rate for comparable loans at the time of
such
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modification), (iii) if the Mortgage Loan is secured by a Ground Lease, extend
the maturity date of such Mortgage Loan beyond a date which is less than 10
years prior to the expiration of the term of such Ground Lease; (iv) reduce the
Mortgage Rate to a rate below the prevailing interest rate for comparable loans
at the time of such modification, as determined by the Special Servicer; or (v)
defer interest due on any Mortgage Loan in excess of 10% of the Stated Principal
Balance of such Mortgage Loan or defer the collection of interest on any
Mortgage Loan without accruing interest on such deferred interest at a rate at
least equal to the Mortgage Rate of such Mortgage Loan.
The determination of the Special Servicer contemplated by clause (B) of the
proviso to the first paragraph, and clause (ii) of the third paragraph, of this
Section 3.20(d) shall be evidenced by an Officer's Certificate to such effect
delivered to the Trustee and the Master Servicer and describing in reasonable
detail the basis for the Special Servicer's determination. The Special Servicer
shall append to such Officer's Certificate any information including but not
limited to income and expense statements, rent rolls, property inspection
reports and appraisals that support such 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 Special Servicer's
ability to charge and collect from the Mortgagor costs otherwise collectible
under the terms of the related Mortgage Note and this Agreement together with
interest thereon.
(f) The 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 Special
Servicer be entitled to payment for such fees or expenses unless such payment is
collected from the related Mortgagor.
(g) The Special Servicer shall notify the Master Servicer, 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 Special Servicer pursuant to Section
3.15(g) hereof.
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(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 in writing of the
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 1998-C2.
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 Defeasance 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.
(i) For any Mortgage Loan other than a Specially Serviced Mortgage Loan and
subject to the rights of the Special Servicer set forth in this Section 3.20,
the Master Servicer shall be responsible for any request by a Mortgagor for the
consent of the mortgagee for a modification, waiver or amendment of any term
with respect to:
(i) Approving routine leasing activity (including any subordination,
standstill and attornment agreements) with respect to leases for less than
the lesser of (a) 20,000 square feet and (b) 20% of the related Mortgaged
Property; and
(ii) Approving a change of the property manager at the request of the
related Mortgagor provided that the successor property manager is not
affiliated with the Mortgagor and is a nationally or regionally recognized
manager of similar properties.
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
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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 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 and each Rating Agency (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 (xiii) of Section 4.02(a) and,
insofar as it relates to the Special Servicer, the information described in
clauses (xxiii) and (xxiv) 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 Special Servicer with respect to each Specially Serviced Mortgage
Loan and REO Property during the
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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) 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 or may terminate such subservicing agreement (except with
respect only to those Sub-Servicing Agreements in effect as of the Closing Date
subject to the provisions of Section 3.22(d)) without cause and without payment
of any penalty or termination fee (except with respect only to those
Sub-Servicing Agreements in effect as of the Closing Date as set forth in
Section 3.22(d)); (iii) provides that the Trustee, for the benefit of the
Certificateholders, shall be a third party beneficiary under such agreement, but
that (except to the extent the Trustee or its designee assumes the obligations
of the 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
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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.
(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.
(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 at any time it
considers such removal to be in the best interests of Certificateholders.
(d) In the event of the resignation, removal or other termination of First
Union National Bank or any successor Master Servicer hereunder for any reason,
the Trustee or other Person succeeding such resigning, removed or terminated
party as Master Servicer, shall elect, with respect to any Sub-Servicing
Agreement existing at the time of such termination: (i) to assume the rights and
obligations of the Master Servicer under such Sub-Servicing Agreement and
continue the sub-servicing arrangements thereunder on the same terms (including
without limitation the obligation to pay the same sub-servicing fee); (ii) to
enter into a new Sub-Servicing Agreement with such Sub-Servicer on such terms as
the Trustee or other successor Master Servicer and such Sub-Servicer shall
mutually agree (it being understood that such Sub-Servicer is under no
obligation to accept any such new Sub-Servicing Agreement or to enter into or
continue negotiations with the Trustee or other successor Master Servicer),
(iii) subject to the terms of the next paragraph, to terminate such
Sub-Servicing Agreement without cause and without the requirement to pay any fee
related to
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such termination, provided that no Sub-Servicer under a Sub-Servicing Agreement
that was in effect as of March 1, 1998, may be terminated without cause unless
it receives Sub-Servicer Termination Compensation, if any, as defined in the
Sub-Servicing Agreement for such Sub-Servicer; or (iv) to terminate the
Sub-Servicing Agreement if an Event of Default (as defined in such Sub-Servicing
Agreement) has occurred and is continuing or either of the events set forth in
clauses (i) or (ii) of the following paragraph has occurred and is continuing,
in each case without paying any sub-servicer termination fee. It shall be the
corporate obligation (not reimbursable by the Trust Fund or any of the other
parties to this Agreement) of the Person, who as successor Master Servicer,
terminates any Sub-Servicer without cause, and of its successors and assigns in
such capacity (to the extent contemplated by clause (iii) of the preceding
sentence), to pay Sub-Servicer Termination Compensation to such terminated
Sub-Servicer.
Each Sub-Servicing Agreement in effect as of March 1, 1998, provides, among
other things, that the Master Servicer may at its sole option, terminate any
rights the Sub-Servicer may have thereunder with respect to any or all Mortgage
Loans without paying any fee related to such termination if any of the Rating
Agencies (i) reduces the rating assigned to one or more Classes of the
respective Certificates as a result of the sub-servicing of the Mortgage Loans
by the Sub-Servicer, or (ii) advise the Master Servicer or the Trustee that it
will cause a qualification, downgrade or withdrawal of such rating due to the
continued servicing by the Sub-Servicer.
(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, Warranties and Covenants 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:
(i) The Master Servicer is a national banking association, duly
organized and in good standing under the laws of the United States of
America, 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 association or by-laws or constitute a default (or an event
which, with notice or
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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 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 receivership, 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, calculated on a consolidated basis.
(vii) Each officer, director, employee, consultant or advisor 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
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Agreement or the consummation of the transactions contemplated by this
Agreement has been obtained and is effective.
(x) The Master Servicer possesses all insurance required pursuant to
Section 3.07(c) 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 Maryland limited partnership, validly
existing and in good standing under the laws of the State of Maryland, 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 a breach of, any material agreement or other material
instrument to which it is a party or by which it is bound.
(iii) The Special Servicer has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement, has
duly authorized the execution, delivery and performance of this Agreement,
and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid, legal
and binding obligation of the Special Servicer, enforceable against the
Special Servicer in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and other
laws affecting the enforcement of creditors' rights generally, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(v) The Special Servicer is not in violation of, and its execution and
delivery of 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.
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(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 possesses all insurance required pursuant to
Section 3.07(c) 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.
(d) The Master Servicer covenants that by August 31, 1999, any custom-made
software or hardware designed or purchased or licensed by the Master Servicer
and used by the Master Servicer in the course of the operation or management of,
or the compiling, reporting or generation of data required by this Agreement
will not contain any deficiency (x) in the ability of such software or hardware
to identify correctly or perform calculations or other processing with respect
to dates after August 31, 1999 or (y) that would cause such software or hardware
to be fit no longer for the purpose for which it was intended by reason of the
changing of the date from 1999 to 2000. A breach of the covenant set forth in
this Section 3.23(d) shall constitute an Event of Default pursuant to Section
7.01(xi) and such Event of Default shall be the sole remedy against the Master
Servicer for the breach of this covenant.
(e) The Special Servicer covenants that by August 31, 1999, any custom-made
software or hardware designed or purchased or licensed by the Special Servicer
and used by the Special Servicer in the course of the operation or management
of, or the compiling, reporting or generation of data required by this Agreement
will not contain any deficiency (x) in the ability of such software or hardware
to identify correctly or perform calculations or
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other processing with respect to dates after August 31, 1999 or (y) that would
cause such software or hardware to be fit no longer for the purpose for which it
was intended by reason of the changing of the date from 1999 to 2000. A breach
of the covenant set forth in this Section 3.23(e) shall constitute an Event of
Default pursuant to Section 7.01(xi) and such Event of Default shall be the sole
remedy against the Special Servicer for the breach of this covenant.
SECTION 3.24. Sub-Servicing Agreement Representation and Warranty.
(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 each
Sub-Servicing Agreement satisfies the requirements for such Sub-Servicing
Agreements set forth in Sections 3.22(a) and the second paragraph of 3.22(d) in
all material respects.
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 solely 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
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(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) to distributions to the Holders of the Class A-1 Certificates and
the Class A-2 Certificates, pro rata, in accordance with the outstanding
Class Principal Balances of each such Classes of Certificates in an amount
equal to, 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;
(v) 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;
(vi) after the Class Principal Balances of the Class A-1 Certificates
and the Class A-2 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 any prior clause of this Section
4.01(a));
(vii) 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;
(viii) 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;
(ix) 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
pursuant to any prior clause of this Section 4.01(a));
(x) to distributions to the Holders of the Class C Certificates, in an
amount equal to, and in reimbursement of, all Realized Losses and
Additional
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Trust Fund Expenses, if any, previously allocated to the Class C
Certificates and not previously reimbursed;
(xi) 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;
(xii) 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
pursuant to any prior clause of this Section 4.01(a));
(xiii) 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;
(xiv) 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;
(xv) 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
pursuant to any prior clause of this Section 4.01(a));
(xvi) 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;
(xvii) 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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(xviii) 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
pursuant to any prior clause of this Section 4.01(a));
(xix) 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;
(xx) 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;
(xxi) 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
pursuant to any prior clause of this Section 4.01(a));
(xxii) 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;
(xxiii) 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;
(xxiv) 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
pursuant to any prior clause of this Section 4.01(a));
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(xxv) 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 the Class H
Certificates and not previously reimbursed;
(xxvi) 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;
(xxvii) 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 distributed on such
Distribution Date to the Holders of any other Class of Certificates
pursuant to any prior clause of this Section 4.01(a));
(xxviii) 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 the Class J
Certificates and not previously reimbursed;
(xxix) to distributions of interest to the Holders of Class K
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class K Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxx) after the Class Principal Balance of the Class J Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class K Certificates, in an amount (not to exceed the Class Principal
Balance of the Class K 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 any prior clauses of this Section 4.01(a));
(xxxi) to distributions to the Holders of the Class K 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 K
Certificates and not previously reimbursed; and
(xxxii) to distributions to the Holders of the Class R-I Certificates,
in an amount equal to the balance, if any, of the Available Distribution
Amount for
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such Distribution Date remaining after the distributions to be made on
such Distribution Date pursuant to clauses (i) through (xxxi) above.
(b) On each Distribution Date, the Paying Agent shall withdraw from the
Distribution Account any amount on deposit therein that represents Prepayment
Premiums actually collected on the Mortgage Loans and any REO Loans during the
related Collection Period and shall distribute such amount, as additional
interest, as follows: Until the aggregate Certificate Principal Balance of the
Sequential Pay Certificates has been reduced to zero, to the Holders of the
Sequential Pay Certificates, in the case of each Class thereof, in an amount
equal to the amount of each such Prepayment Premium, multiplied by (a) a
fraction (which in no event may be greater than one) the numerator of which is
equal to the excess, if any, of the Pass-Through Rate of such Class of
Sequential Pay Certificates over the relevant Discount Rate (as defined below),
and the denominator of which is equal to the excess, if any, of the Mortgage
Rate of the prepaid Mortgage Loan over the relevant Discount Rate, and (b) a
fraction, the numerator of which is equal to the amount of principal
distributable on such Class of Sequential Pay Certificates on such Distribution
Date, and the denominator of which is the Principal Distribution Amount for such
Distribution Date. The portion, if any, of the Prepayment Premium remaining
after any such payments to the Holders of the Sequential Pay Certificates will
be distributed to the Holders of the Class IO Certificates. The "Discount Rate"
applicable to any Class of Sequential Pay Certificates will be equal to the
yield (when compounded monthly) on the U.S. Treasury issue (primary issue) with
a maturity date closest to the maturity date for the prepaid Mortgage Loan. In
the event that there are two such U.S. Treasury issues (a) with the same coupon,
the issue with the lower yield will be utilized, and (b) with maturity dates
equally close to the maturity date for the prepaid Mortgage Loan, the issue with
the earliest maturity date will be utilized.
(c) On each Distribution Date any Additional Interest collected during the
related Collection Period and available in the Additional Interest Distribution
Account shall be distributed to the Holders of the Class L Certificates.
(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
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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 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, to the
extent it is not required to dispose of such unclaimed funds otherwise in
accordance with applicable state escheatment law, distribute the unclaimed funds
to the Class R-I 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
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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 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 first anniversary following
delivery of the second notice, the Paying Agent shall dispose of all unclaimed
funds and other assets in accordance with applicable state law.
(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 and the Class L 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 each Component of the
Class IO Certificates on each Distribution Date pursuant to Section 4.01(a),
4.01(b) or
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9.01 shall be deemed to have first been distributed from REMIC II to REMIC III
in respect of the REMIC II Regular Interest corresponding to the Class of
Certificates having the same alphabetical and numerical (if any) designation as
such Component to the extent of one month's interest accrued at a rate equal to
the Pass-Through Rate for such Component on the Uncertificated Principal Balance
of such REMIC II Regular Interest immediately prior to such Distribution Date.
(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 deemed distributions in respect of the REMIC I Regular
Interests, in an amount equal to, pro rata in accordance with, and in
reimbursement of previously allocated Realized Losses and Additional Trust
Fund Expenses (with compounded interest), allocated to each such REMIC I
Regular Interest.
Any Prepayment Premium distributed to any Class of Certificates on any
Distribution Date shall, in each case, be deemed to have been distributed from
REMIC I to REMIC II in respect of the REMIC I Regular Interest corresponding to
the prepaid Mortgage Loan or REO Loan, as the case may be, in respect of which
such premium was received.
SECTION 4.02. Statements to Certificateholders; CSSA Loan File Report.
(a) On each Distribution Date, the Trustee shall forward by mail (or
by electronic transmission acceptable to the recipient) to all of the Holders of
each Class of Regular Certificates, a statement (a "Distribution Date
Statement"), as to the distributions made on such Distribution Date, based
solely on information provided to it by the Master Servicer and the Special
Servicer, setting forth:
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(i) the amount of the distribution on such Distribution Date to the
Holders of each 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 each Class of Regular Certificates allocable to Distributable
Certificate Interest;
(iii) the amount of the distribution on such Distribution Date to the
Holders of each Class of Regular Certificates allocable to Prepayment
Premiums;
(iv) the amount of the distribution on such Distribution Date to the
Holders of each 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), 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 or the
Trustee 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 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;
(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 30-59 days, (B) delinquent 60-89 days, (C) delinquent more than
89 days, and (D) as to which foreclosure proceedings have been commenced;
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(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, and (C) a brief
description of any executed loan modification;
(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 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 (C) the amount of any Realized Loss
in connection with such Liquidation Event;
(xiii) 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)
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
(C) the amount of any Realized Loss in respect of the related REO Loan in
connection with such Final Recovery Determination;
(xiv) the Accrued Certificate Interest and Distributable Certificate
Interest in respect of each Class of Regular Certificates for such
Distribution Date;
(xv) any unpaid Distributable Certificate Interest in respect of each
Class of Regular Certificates after giving effect to the distributions made
on such Distribution Date;
(xvi) the Pass-Through Rate for each Class of Regular Certificates for
such Distribution Date;
(xvii) 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);
(xviii) the aggregate of all Realized Losses incurred during the
related Collection Period and all Additional Trust Fund Expenses incurred
during the related Collection Period;
(xix) the aggregate of all Realized Losses and Additional Trust Fund
Expenses that were allocated on such Distribution Date;
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(xx) 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;
(xxi) the Certificate Factor for each Class of Regular Certificates
immediately following such Distribution Date;
(xxii) the aggregate amount of interest on P&I Advances paid to the
Master Servicer and the Trustee during the related Collection Period in
accordance with Section 4.03(d);
(xxiii) the aggregate amount of interest on Servicing Advances paid to
the Master Servicer, the Trustee and the Special Servicer during the
related Collection Period in accordance with Section 3.03(d);
(xxiv) the aggregate amount of servicing fees paid to the Master
Servicer and the Special Servicer during the related Collection Period; and
(xxv) the amounts, if any, actually distributed with respect to the
Class R-I Certificates, Class R-II Certificates and Class R-III
Certificates on such Distribution Date.
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 of each applicable Class and per Single Certificate. In the
case of information provided to the Trustee as a basis for information to be
furnished pursuant to clauses (x) through (xiii), and (xxiv) above, insofar as
the underlying information is solely within the control of the Special Servicer,
the Trustee and the Master Servicer may, absent manifest error, conclusively
rely on the reports to be provided by the Special Servicer.
The Trustee may rely on and shall not be responsible absent manifest error
for the content or accuracy of any information provided by third parties for
purposes of preparing the Distribution Date Statement and may affix thereto any
disclaimer it deems appropriate in its reasonable discretion (without suggesting
liability on the part of any other party hereto).
The Trustee shall deliver or shall cause to be delivered on each
Distribution Date by first class mail to each Certificateholder, the Depositor,
the Underwriters; each Rating Agency and any other Person designated in writing
by the Depositor (on diskette or via such other electronic medium as is mutually
acceptable to the Trustee and the recipient) a copy of the following nine
reports or in the case of reports to Persons designated in writing by the
Depositor, any of the following nine reports delivered to it by the Master
Servicer pursuant to Section 3.12(c): (i) the Delinquent Loan Status Report,
(ii) the Historical Loss Estimate Report, (iii) the Historical Loan Modification
Report, (iv) the REO Status Report, (v) the
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Watch List, (vi) a Loan Payoff Notification Report, (vii) a Comparative
Financial Status Report, (viii) an Operating Statement Analysis and (ix) an NOI
Adjustment Worksheet. The Trustee shall deliver or shall cause to be delivered
on each Distribution Date by first class mail (or by electronic transmission
acceptable to the recipient) to each Certificateholder, the Underwriters, the
Depositor, each Rating Agency and each other Person that received a Distribution
Date Statement on such Distribution Date a hard copy (or by an electronic medium
acceptable to the recipient) of the CSSA Loan File Report and the CSSA Property
File Report containing information regarding each Mortgaged Property as of the
end of the preceding calendar month. The Trustee also shall deliver the CSSA
Loan File Report and CSSA Property File Report relating to any Distribution Date
by electronic medium (including computer diskette) to each Rating Agency and,
upon written request, to either Underwriter and to any Certificateholder or
Certificate Owner entitled to receive a hard copy thereof. Absent manifest
error, none of the Master Servicer or the Special Servicer shall be responsible
for the accuracy or completeness of any information supplied to it by a borrower
or third party that is included in any reports, statements, materials or
information prepared or provided by the Master Servicer or the Special Servicer,
as applicable. The Trustee shall not be responsible absent manifest error for
the accuracy or completeness of any information supplied to it for delivery
pursuant to this Section. Neither the Trustee, the Master Servicer nor the
Special Servicer shall have any obligation to verify the accuracy or
completeness of any information provided by a Mortgagor or third party.
The Trustee shall deliver a copy of each Comparative Financial Status
Report that it receives from the Master Servicer to the Depositor, the
Underwriters, and each Rating Agency promptly after its receipt thereof pursuant
to Section 3.12(c). Any Certificateholder may obtain a copy of each Comparative
Financial Status Report upon written request to the Trustee. Upon specific
written request, the Trustee shall deliver a copy of each NOI Adjustment
Worksheet that it receives from the Master Servicer pursuant to Section 3.12(c)
to the Depositor and each Rating Agency. The Trustee shall automatically deliver
a copy of each annual Operating Statement Analysis that it receives from the
Master Servicer pursuant to Section 3.12(c) to each Rating Agency and the
Underwriters on April 30th of such year. The Trustee shall deliver a copy of
each annual Operating Statement Analysis that it receives from the Master
Servicer pursuant to Section 3.12(c) to the Depositor. Any Certificateholder may
obtain a copy of any NOI Adjustment Worksheet or Operating Statement Analysis in
the possession of the Trustee upon written request and at the expense of such
Certificateholder.
Within a reasonable period of time after the end of each calendar year, the
Trustee shall send to each Person who at any time during the calendar year was a
Certificateholder of record, a report summarizing on an annual basis (if
appropriate) the items provided to Certificateholders pursuant to Section
4.02(a)(i), (ii), (iii) and (iv) above and such other information as may be
required to enable such Certificateholders to prepare their federal income tax
returns. Such information shall include the amount of original issue discount
accrued on each Class of Certificates and information regarding the expenses of
the Trust. Such requirement shall be deemed to be satisfied to the extent such
information is provided pursuant to applicable requirements of the Code from
time to time in force.
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On each Distribution Date, the Trustee shall forward 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.
If any Certificate Owner does not receive through the Depository or any of
its Depository Participants any of the statements, reports and/or other written
information described above in this Section 4.02(a) that it would otherwise be
entitled to receive if it were the Holder of a Definitive Certificate evidencing
its ownership interest in the related Class of Book Entry Certificates, then the
Trustee shall mail or cause the mailing of such statements, reports and/or other
written information to such Certificate Owner upon the request of such
Certificate Owner made in writing to the Corporate Trust Office (accompanied by
current verification of such Certificate Owner's ownership interest). Such
portion of such information as may be agreed upon by the Depositor and the
Trustee shall be furnished to any such Person via overnight courier delivery or
telecopy from the Trustee; provided that the cost of such overnight courier
delivery or telecopy shall be an expense of the party requesting such
information.
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 Special Servicer or Master Servicer,
as applicable, 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 or the Master
Servicer to violate any applicable law prohibiting disclosure of information
with respect to any Mortgagor and the failure of the Trustee, Master Servicer or
the Special Servicer to disseminate information for such reason shall not be a
breach hereof.
(b) Not later than 1:30 P.M. on the second Business Day following each
Determination Date the Master Servicer shall furnish to the Trustee, the
Depositor and the Underwriters, by electronic transmission (or in such other
form to which the Trustee, the Underwriters or the Depositor, as the case may
be, and the Master Servicer may agree), with a hard copy of such transmitted
information to follow not later than the third Business Day following such
Determination Date, an accurate and complete CSSA Loan File Report providing the
required information for the Mortgage Loans as of such Determination Date.
In the performance of its obligations set forth in Section 4.05 and its
other duties hereunder, the Trustee may conclusively rely on the CSSA Loan File
Report provided to it by the Master Servicer, and the Trustee shall not be
responsible to recompute, recalculate or verify the information provided to it
by the Master 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, shall not be in default
hereunder due to a delay in providing the CSSA Loan
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File Report caused by the Special Servicer's failure to timely provide any
report required under this Agreement and may, absent manifest error,
conclusively rely on the reports to be provided by the Special Servicer.
SECTION 4.03. P&I Advances.
(a) On or before 2:00 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 3:00 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 (704)
383-9356 (or such alternative number provided by the Master Servicer to the
Trustee in writing) and by telephone at telephone (704) 383-0535 (or such
alternative number provided by the Master Servicer to the Trustee in writing) as
soon as possible, but in any event before 4:00 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 10:00 a.m., New York City time, on the related Distribution Date,
then, subject to Section 4.03(c), (i) the Trustee shall, no later than 11:00
a.m., New York City time, on such related Distribution 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.
(b) The aggregate amount of P&I Advances to be made by the Master Servicer
or the Trustee 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 Master 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
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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 Master 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 or the Trustee 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 (A) the amount of the P&I Advance that would otherwise be
required without regard to this clause (ii), multiplied by (B) 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.
(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 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 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, as
applicable, shall rely on the Master Servicer's determination that the P&I
Advance would be a Nonrecoverable Advance if the Trustee 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 shall make such Advance within the time
periods required by Section 4.03(a) unless the Trustee, in good faith, makes a
determination prior to the times specified in
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Section 4.03(a) that such P&I Advance would be a Nonrecoverable Advance. The
Trustee 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 or the Trustee
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 and the Trustee out of any
amounts then on deposit in the Certificate Account, interest at the
Reimbursement Rate in effect from time to time compounded annually, 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 or the Trustee, as
applicable, for any outstanding P&I Advance made thereby as soon as practicable
after funds available for such purpose have been received by the Master
Servicer, and in no event shall interest accrue in accordance with this Section
4.03(d) on any P&I Advance as to which the corresponding Late Collection was
received by the Master Servicer as of the related P&I Advance Date.
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 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 K, Class J, Class H, Class
G, Class F, Class E, Class D, Class C and Class B Certificates, in that order,
until the respective remaining Class Principal Balance of each such Class has
been reduced to zero and second, to the Class A-1 and Class A-2 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. 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 any Regular Certificates on any Distribution Date shall be deemed to have
first been allocated to the corresponding class of REMIC II Regular Interest
with a corresponding reduction in the Uncertificated Principal Balance of such
REMIC II Regular Interest.
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(c) On each Distribution Date, following the deemed distributions to be
made in respect of the REMIC I Regular Interests pursuant to Section 4.01(j),
the Uncertified Principal Balance of each REMIC I Regular Interest (after taking
account of such deemed distributions) shall be reduced to equal the Stated
Principal Balance of the related Mortgage Loan or REO Loan, as the case may be,
that will be outstanding immediately following such Distribution Date. Such
reductions shall be deemed to be an allocation of Realized Losses and Additional
Trust Fund Expenses.
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 limited powers-of-attorney delivered by the Trustee to the Master
Servicer or 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 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 through A-16; 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, Class J and Class K Certificates, and in each such
case in integral multiples of $1 in excess thereof. Neither the Residual
Certificates nor the Class L Certificates will have any Certificate Principal
Balance or Certificate Notional Amount.
(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
(located as of the Closing Date at Norwest Center, Sixth and Marquette,
Minneapolis, Minnesota 55479-0113), may prescribe, the Certificate Registrar
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The Trustee is hereby initially
appointed (and
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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
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-1 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.
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(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 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, Class J or Class K
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 to execute a certification affidavit 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 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
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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 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 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 Regulations 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
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fact not permitted by this Section 5.02(d) or for making any payments due
on such Certificate to the Holder thereof or for taking any other action
with respect to such Holder under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of a
Residual 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 qualified
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 in its possession which is necessary to compute any tax imposed
(A) as a result of the Transfer of 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 Fund), to the effect that doing so will not cause any 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 AND THE SPECIAL SERVICER
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 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 or
organization, 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, and the Master Servicer shall keep in full effect
its existence and rights as a national banking association under the laws of the
United States.
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;
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provided, however, that this provision shall not protect the Depositor, the
Master Servicer or 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 by such party of a
representation, warranty or covenant made herein; or (iii) incurred by reason of
willful misfeasance, bad faith or negligence on the part of such party 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
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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 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. Each
of the Master Servicer and the Special Servicer shall have the right to resign
at any other time and 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 or Special 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 and except as provided in the preceding
paragraph, 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 paragraph 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, except as
otherwise provided herein, 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, each of the Master Servicer and, to the
extent relevant to the performance of the Special Servicer's duties hereunder,
the Special Servicer shall 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
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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 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 by the delivery to the Trustee, the Master Servicer and the
existing Special Servicer of a written notice stating such designation.
Notwithstanding the foregoing, with respect to any Specially Serviced Mortgage
Loan in respect of which the Holder or Holders of the Certificates evidencing a
majority of the Voting Rights allocated to the Controlling Class owns an
economic interest in the related Mortgagor or is the lender of partnership debt
to the related Mortgagor (the "Interested Holders"), the Holder or Holders of
the Certificates evidencing a majority of the Voting Rights allocated to the
Class of Sequential Pay Certificates (which meets the criteria set forth in
clauses (a) and (b) of the definition of Controlling Class and the majority of
the Voting Rights allocated thereto are not held by Interested Holders) shall
appoint one or more Persons to act as alternative special servicer or
alternative special servicers (in each case meeting the
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requirements set forth in Section 6.02) with respect to such Specially Serviced
Mortgage Loans and vest in such Person or Persons, in such capacity, such
powers, duties and obligations of the Special Servicer with respect to such
Specially Serviced Mortgage Loans, and such Holder or Holders shall give written
notice of such appointment to the Master Servicer, the Special Servicer and the
Trustee. 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. Any costs or expenses incurred in connection with the
replacement by such Holder 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, or the
appointment of an alternative special servicer shall be borne by the Controlling
Class. 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 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 (subject to customary bankruptcy
and insolvency qualifications). 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.
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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 (except as otherwise set forth in
the definition of "Certificateholder") 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 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.
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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; provided, however, that if such
failure to deposit or remit occurs only once in any consecutive
twelve-month period, which failure is corrected by 10:00 a.m., New York
City time on the related Distribution Date, then with respect to such one
failure only, a default shall be deemed not to have occurred; 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, 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, provided, however, that with respect to any such failure
which is not curable within such 30-day period, the Master Servicer or the
Special Servicer, as the case may be, shall have an additional cure period
of thirty (30) days to effect such cure so long as the Master Servicer or
the Special Servicer, as the case may be, has commenced to cure such
failure within the initial 30-day period and has provided the Trustee with
an Officer's Certificate certifying that it has diligently pursued, and is
continuing to pursue, a full cure; 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
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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,
provided, however, that with respect to any breach which is not curable
within such 30-day period, the Master Servicer or the Special Servicer, as
the case may be, shall have an additional cure period of thirty (30) days
so long as the Master Servicer or the Special Servicer, as the case may be,
has commenced to cure within the initial 30-day period and provided the
Trustee with an Officer's Certificate certifying that it has diligently
pursued, and is continuing to pursue, a full cure; 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 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 (which the Trustee shall promptly forward to the Master Servicer or
the Special Servicer as the case may be) 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
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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 related Distribution
Date, then with respect to such one failure only, a default shall be deemed
not to have occurred; or
(xi) the Master Servicer or the Special Servicer shall breach the
covenant set forth in Section 3.23(d) or 3.23(e), respectively.
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) and clause (xi)
of subsection (a) above shall occur with respect to the Master Servicer or the
Special Servicer (in either case, 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. 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
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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.
(c) The Master Servicer and the Special Servicer each agree that, if it is
terminated pursuant to 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) in the case of the Master
Servicer, the immediate transfer to the Trustee or a successor Master 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, the Additional Interest Distribution Account or a
Servicing Account (if the Master Servicer is the Defaulting Party) or that are
thereafter received by or on behalf of the terminated Master Servicer with
respect to any Mortgage Loan or (ii) in the case of the Special Servicer, 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 the terminated Special Servicer with respect to any Mortgage Loan
or REO Property (provided, however, that the Master Servicer and the Special
Servicer each shall, if terminated pursuant to 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).
(d) Any cost or expenses in connection with any actions to be taken by the
Master Servicer or Special Servicer or the Trustee pursuant to Section 7.01(c)
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 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.
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SECTION 7.02. Trustee to Act; Appointment of Successor.
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
all (and the former Master Servicer or the Special Servicer, as the case may be,
shall cease to have any) of the responsibilities, duties and liabilities (except
as provided in the next sentence) 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. Notwithstanding anything contrary in this Agreement, the Trustee
shall in no event be held responsible or liable with respect to any of the
representations and warranties of the resigning or terminated party (other than
the Trustee) or for any losses incurred by such 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 be
entitled to all fees and other compensation which the resigning or terminated
party would have been entitled to if the resigning or terminated party had
continued to act hereunder. Notwithstanding the above, the Trustee may, if it
shall be unwilling in its sole discretion 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; 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
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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 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.
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 written 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. Except as expressly
provided in Article VIII, under no circumstances shall the rights provided to
the Trustee under this Section 7.05 be construed as a duty or obligation of the
Trustee.
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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 if it was required to do so;
(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;
(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; and
(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 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 of the Depositor or the Master
Servicer or the Special Servicer, as the case may be, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations
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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 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 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 or any agent of the Trustee, in its individual or any other
capacity, may become the owner or pledgee of Certificates with the same rights
(except as otherwise provided in the definition of "Certificateholder") it would
have if it were not the Trustee 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
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 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 Principal Balance of the
Certificates. The Trustee 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, affiliate, 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, the Mortgage Loans 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
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provisions of this Section 8.05(b) and 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 Trustee shall also be an entity
with a credit rating of at least "AA" by each Rating Agency other than Moody's
and "Aa3" by Moody's 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
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Special Servicer and to all Certificateholders at their respective
addresses set forth in the Certificate Register. 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 report to be delivered by the Trustee pursuant to 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 appoint a successor trustee, 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.
(c) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee, 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 and one complete set to the successor trustee 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 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).
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(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.
SECTION 8.08. Successor Trustee.
(a) Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor, the Master Servicer, the
Special Servicer and to its predecessor trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with the
like effect as if originally named as trustee herein. The predecessor trustee
shall deliver to the successor trustee all Mortgage Files and related documents
and statements held by it hereunder (other than any Mortgage Files at the time
held on its behalf by a Custodian, which Custodian shall become the agent of the
successor trustee), and the Depositor, the 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.
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,
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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 cease to exist, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
(e) The appointment of a co-trustee or separate trustee under this Section
8.10 shall not relieve the Trustee of its duties and responsibilities hereunder.
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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 (other than the Trustee) 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 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.
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(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 authorized under law to exercise corporate trust powers and shall have
a rating of at least "A" (or its equivalent) by each of 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
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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 to the extent such Paying Agent would have
been responsible pursuant to the terms hereof. 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
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
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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, Warranties and Covenants of Trustee.
(a) The Trustee hereby represents and warrants to the Master Servicer, the
Special Servicer 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.
(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 organizational documents or
constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or result in a breach of, any
material agreement or other material instrument to which it is a party or
by which it is bound.
(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 against the Trustee in accordance
with the terms hereof, subject to (A) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally and the rights of creditors of banks, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
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(v) The Trustee is not in violation of, and its execution and delivery
of this Agreement and its performance and compliance with the terms of this
Agreement will not constitute a violation of, any law, 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 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 rIequired 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.
(b) The Trustee covenants that by August 31, 1999, any custom-made software
or hardware designed or purchased or licensed by the Trustee and used by the
Trustee in the course of the operation or management of, or the compiling,
reporting or generation of data required by this Agreement will not contain any
deficiency (x) in the ability of such software or hardware to identify correctly
or perform calculations or other processing with respect to dates after August
31, 1999 or (y) that would cause such software or hardware to be fit no longer
for the purpose for which it was intended by reason of the changing of the date
from 1999 to 2000.
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. Upon such filing with the Securities and Exchange Commission, the
Trustee shall promptly deliver to the Depositor and the Master Servicer 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
for herein is invalid or
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unenforceable, then the Depositor shall contribute to the amount paid by the
Trustee as a result of such liability in such amount as is necessary to limit
the Trustee's responsibility for any such payment to any amount resulting from
its own negligence or willful misconduct. The Trustee shall have no
responsibility to determine whether or not any filing may be required and shall
not have any responsibility to review or confirm in any way the accuracy or the
sufficiency of the contents of any such filing.
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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 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, the Master Servicer or
the Special 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 or the Special Servicer, the aggregate
amount of unreimbursed Advances made by the Master Servicer or the Special
Servicer, as the case may be, together with any interest accrued and payable to
the Master Servicer or the Special Servicer in respect of unreimbursed Advances
in accordance with Sections 3.03(d) and 4.03(d) and any unpaid Servicing Fees
remaining outstanding (which items shall be deemed to have been paid or
reimbursed to the Master Servicer or the Special Servicer, as the case may be,
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 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 earlier of (i) 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, or
(ii) the Rated Final Distribution Date specified in Section 10.01(e).
The Depositor, the Master Servicer or the Special 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
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terminated in connection with the Master Servicer's, the Special Servicer's or
the Depositor's purchase of all of the Mortgage Loans and each REO Property
remaining in REMIC I, the Master Servicer, the Special Servicer or the
Depositor, as applicable, shall 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 written
confirmation that such final deposit has been made, the Trustee shall release or
cause to be released to the Master Servicer, the Special 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, the Special 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), the Special
Servicer 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, the Special 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, shall be allocated in the
following order of priority, in each case to the extent of remaining available
funds:
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(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 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) to distributions to the Holders of the Class A-1 and Class A-2
Certificates, in an amount equal to, and pro rata in accordance with the
amount of Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to such Classes of Certificates and for which no
reimbursement has previously been received, to reimburse such Holders for
such Realized Losses and Additional Trust Fund Expenses, if any;
(v) 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;
(vi) after the Class Principal Balance of the Class A-1 Certificates
and the Class A-2 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;
(vii) 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;
(viii) 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;
(ix) 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;
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(x) 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;
(xi) 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;
(xii) 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;
(xiii) 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;
(xiv) 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;
(xv) 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;
(xvi) 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;
(xvii) 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;
(xviii) 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;
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(xix) 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;
(xx) 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;
(xxi) 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;
(xxii) 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;
(xxiii) 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;
(xxiv) 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;
(xxv) 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;
(xxvi) 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;
(xxvii) 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;
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(xxviii) 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;
(xxix) to distributions of interest to the Holders of the Class K
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class K Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxx) after the Class Principal Balance of the Class J Certificates
has been reduced to zero, to distributions of principal to the Holders of
the Class K Certificates, in an amount equal to the Class Principal Balance
of the Class K Certificates outstanding immediately prior to such
Distribution Date;
(xxxi) to distributions to the Holders of the Class K, in an amount
equal to, and in reimbursement of, all Realized Losses and Additional Trust
Fund Expenses, if any, previously allocated to the Class K Certificates and
not previously reimbursed; and
(xxxii) to distributions to the Holders of the Class R-I 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 (xxxi)
above.
Any Prepayment Premiums on deposit in the Certificate Account as of the
final Distribution Date shall be distributed among the Holders of the Regular
Certificates, and any Additional Interest on deposit in the Additional Interest
Distribution Account as of the final Distribution Date shall be distributed to
the Holders of Class L Certificates, in accordance with Sections 4.01(b) and
4.01(c), respectively. Anything in this Section 9.01 to the contrary
notwithstanding, the Holders of Class L Certificates 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
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hereunder. If, within one year after the second notice, all of the Certificates
shall not have been surrendered for cancellation, the Class R-I
Certificateholder shall be entitled to all unclaimed funds and other assets
which remain subject thereto (to the extent it is not required to dispose of
such unclaimed funds and assets otherwise in accordance with applicable state
escheatment law.)
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 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, the Master Servicer or the Special 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, the Special Servicer or the Depositor,
as applicable, obtains at its own expense and delivers to the Trustee and the
REMIC Administrator and, in the case of the Depositor, to the Trustee and the
Master Servicer, an Opinion of Counsel, addressed to the Trustee, the REMIC
Administrator 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 or
REMIC III as defined in Section 860F of the Code or cause REMIC I, REMIC II or
REMIC III to fail to qualify as a REMIC at any time that any Certificates are
outstanding:
(i) the REMIC Administrator shall specify the first day in the 90-day
liquidation period in a statement attached to the final Tax Return for each
of REMIC I, REMIC II and REMIC III pursuant to Treasury Regulations 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
such purchasing party;
(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.
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(b) By their acceptance of Certificates, the Holders thereof hereby agree
to authorize the REMIC Administrator 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 (or 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 Regulations 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) Each 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 Regulations Sections
1.860G-1(a)(4)(iii), February 15, 2030, has been designated the "latest possible
maturity date" of each REMIC I Regular Interest, each REMIC II Regular Interest
and each Class of Regular Certificates (or in the case of the Class IO
Certificates, each of its Components).
(f) The Trustee shall pay any and all ordinary tax-related expenses of any
of REMIC I, REMIC II or REMIC III from the Trust Fund. Any taxes, penalties,
interest or 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 Internal Revenue Service or state or local taxing
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authorities will (to the extent not payable by a specified Person pursuant to
Section 10.01(j)) 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 ordinary 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 expressly permitted by this Agreement, but
in no event at the cost or expense of the Trust Fund, the REMIC Administrator 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
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under clauses (ii)-(vi) of this Section; (ii) the Special Servicer, if such tax
arises out of or results from a breach by the Special Servicer of any of its
obligations under Article III or this Article X; (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, to the extent it is within its control, 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.
<PAGE>
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ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment.
(a) This Agreement may be amended from time to time by the mutual agreement
of the 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 involving a Class of
Certificates rated by a Rating Agency 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 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) This Agreement may also be amended from time to time by the agreement
of the Depositor, the Master Servicer, the Special Servicer 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
and the Trustee (which opinion, insofar as economic issues involving a Class of
Certificates rated by a Rating Agency are concerned, may rely upon the assurance
of the Rating Agencies described below), adversely affect in any
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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
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 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 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 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, and without receiving notice to the contrary from
Holders of Certificates entitled to at least 25% of the Voting Rights, shall
have neglected or refused to
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institute any such action, suit or proceeding. It is understood and intended,
and expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatsoever by virtue of any provision of this
Agreement to affect, disturb or prejudice the rights of the Holders of any other
of such Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder, which priority or preference is not otherwise provided
for herein, or to enforce any right under this Agreement, except in the manner
herein provided and for the equal, ratable and common benefit of all
Certificateholders. For the protection and enforcement of the provisions of this
Section, 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 without
regard to conflicts of law principles.
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, First Union National Bank, First Union Capital Markets Group, One
First Union Center, 301 South College Street, Charlotte, North Carolina
28288-1075, Attention: Merrill Lynch Mortgage Pass-Through Certificates, Series
1998-C2, facsimile number: 704-383-9356; (iii) in the case of the Special
Servicer, CRIIMI MAE Services Limited Partnership, 11200 Rockville Pike,
Rockville, Maryland 20852, Attention: Legal Department - Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series 1998-C2; (iv) in the
case of the Trustee, Norwest Bank Minnesota, National Association, Corporate
Trust Department, 11000 Broken Land Parkway, Columbia, Maryland 21044-3562,
facsimile number 410-884-2360; and (v) in the case of the Rating Agencies, (A)
Moody's Investors Service, Inc., 99 Church Street, New York, New York 10007,
Attention: CMBS Monitoring; facsimile number: 212-553-1350; and (B) 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.
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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, 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, and (ii) this Agreement shall constitute a security agreement under
applicable law. 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. Each of the
Sub-Servicers that is a party to a Sub-Servicing Agreement on the Closing Date
shall be a third party beneficiary to obligations of a successor Master Servicer
under Section 3.22(d), provided that the sole remedy for any claim by a
Sub-Servicer as a third party beneficiary pursuant to this Section 11.08 shall
be against a successor Master Servicer solely in its corporate capacity and no
Sub-Servicer shall have any rights or claims against the Trust Fund or any party
hereto (other than a successor Master Servicer in its corporate capacity as set
forth in this Section 11.08) as a result of any rights conferred on such
Sub-Servicer as a third party beneficiary pursuant to this Section 11.08. This
Agreement may not be amended in any manner that would adversely affect its
rights as a third party beneficiary without its consent.
SECTION 11.09. 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.
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SECTION 11.10. Notices to and From 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 or the
Additional Interest 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; and
(ii) any change in the location of the Certificate 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 and not previously delivered, 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 by it to the Trustee
pursuant to Section 4.03(c) or 3.08; and
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(iv) each of its inspection reports described in Section 3.12(a) and
the statements and reports described in Section 3.12(b), 3.12(c) and
3.12(d).
(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.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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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 ACKERMAN
----------------------------------------
Name: Bruce Ackerman
Title: Authorized Signatory
FIRST UNION NATIONAL BANK
Master Servicer
By: /s/ TIMOTHY S. RYAN
----------------------------------------
Name: Timothy S. Ryan
Title: Vice President
CRIIMI MAE SERVICES LIMITED PARTNERSHI
Special Servicer
By: CRIIMI MAE SERVICES, INC.
Its general Partner
By: /s/ DAVID B. IONNAVONE
----------------------------------------
Name: David B. Ionnavone
Title: Senior Vice President/General Counsel
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
Trustee
By: /s/ RONALD M. FELDMAN
----------------------------------------
Name: Ronald M. Feldman
Title: Vice President
<PAGE>
EXHIBIT A-1
FORM OF CLASS A-1 CERTIFICATE
CLASS A-1 MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
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: March 1, 1998 Balance of this Class A-1
Certificate as of the Closing Date:
$-----------
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$-----------
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No. ______________
<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 THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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, AS AMENDED (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, CLASS J AND CLASS K CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO,
THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE, 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-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
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the
-2-
<PAGE>
Agreement), CRIIMI MAE Services Limited Partnership (in such capacity,
hereinafter called the "Special Servicer", which term includes any successor
entity under the Agreement) and Norwest Bank Minnesota, National Association
(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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 Norwest
Bank Minnesota, National Association, 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
-3-
<PAGE>
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 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.
-4-
<PAGE>
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 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 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, the Special 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, the Special 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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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.
-5-
<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.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated: March 27, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
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.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION
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 prvided by ______________________, the Assignee named
above, or ______________, as its agent.
-9-
<PAGE>
EXHIBIT A-2
FORM OF CLASS A-2 CERTIFICATE
CLASS A-2 MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
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: March 1, 1998 Balance of this Class A-2
Certificate as of the Closing Date:
$-----------
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$-----------
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No. ____________
<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 THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, , THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 AS AMENDED (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, CLASS J AND CLASS K CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO,
THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE AND THE CLASS A-1
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
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the
-2-
<PAGE>
Agreement), CRIIMI MAE Services Limited Partnership (in such capacity,
hereinafter called the "Special Servicer", which term includes any successor
entity under the Agreement) and Norwest Bank Minnesota, National Association
(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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 Norwest
Bank Minnesota, National Association, 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
-3-
<PAGE>
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 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.
-4-
<PAGE>
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 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 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, the Special 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, the Special 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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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.
-5-
<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.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated: March 27, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
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.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION
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 prvided by ______________________, the Assignee named
above, or ______________, as its agent.
-9-
<PAGE>
EXHIBIT A-3
FORM OF CLASS IO CERTIFICATES
CLASS IO MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
Pass-Through
Rate: Variable
Date of Pooling and Servicing Aggregate Certificate Notional
Agreement: March 1, 1998 Amount of the Class IO Certificates
as of the Closing Date:
$-------------
Closing Date: March 27, 1998 Certificate Notional Amount of this
Class IO Certificate as of the
Closing Date: $-------------
First Distribution Date: Aggregate Stated Principal Balance
April 16, 1998 of the Mortgage loans as of the
Cut-Off Date $_____________
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 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.
<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 THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 EVIDENCES A
BENEFICIAL OWNERSHIP INTEREST IN ELEVEN "REGULAR INTERESTS" 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, AS
AMENDED (THE "CODE"). THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE
PURPOSES OF APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID")
RULES TO THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 26, 1998.
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 FEBRUARY 25, 1998 AND THE PROSPECTUS
SUPPLEMENT DATED MARCH 19, 1998 RELATING TO THIS CERTIFICATE) OF 0% AND THAT THE
ARD LOANS ARE REPAID IN FULL ON THEIR RESPECTIVE ANTICIPATED REPAYMENT DATES AS
SET FORTH IN SUCH PROSPECTUS SUPPLEMENT (THE "PREPAYMENT ASSUMPTION"), THIS
CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $________ OF OID PER $1,000 OF
INITIAL CERTIFICATE NOTIONAL AMOUNT, THE YIELD TO MATURITY IS ___% PER ANNUM,
AND THE AMOUNT OF OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN
$____________ PER $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), First Union National Bank (in such capacity, hereinafter called the
"Master Servicer", which term includes any successor entity under the
Agreement), CRIIMI MAE Services Limited Partnership (in such capacity,
hereinafter called the "Special Servicer", which term includes any successor
entity under the Agreement), and Norwest Bank Minnesota, National Association
(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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 Norwest
Bank Minnesota, National Association 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 will
be made in like manner, but only upon
-3-
<PAGE>
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
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 Paying Agent, the
Certificate
-4-
<PAGE>
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, the Special 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, the Special 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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By _________________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class IO Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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 prvided by ______________________, the Assignee named
above, or ______________, as its agent.
-9-
<PAGE>
EXHIBIT A-4
FORM OF CLASS B CERTIFICATE
FORM OF CLASS B MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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: Variable B Certificates as of the Closing
Date: $__________
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: March 1, 1998 of this Class B
Certificate as of the Closing Date:
$___________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$___________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services
Limited Partnership
Certificate No. 1 CUSIP No. ___________
<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., NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
CRIIMI MAE SERVICES LIMITED PARTNERSHIP, 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, 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, AS AMENDED (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 G TO THE POOLING AND SERVICING
AGREEMENT REFEREED TO HEREIN.
-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 CODE.
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS A-1 CERTIFICATES,
AND THE CLASS A-2 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,
CLASS J, CLASS K AND CLASS L 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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), (or any successor
entity under the Agreement) and Norwest Bank Minnesota, National Association
(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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the
-3-
<PAGE>
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 Norwest Bank Minnesota,
National Association, 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.
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.
-4-
<PAGE>
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.
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
-5-
<PAGE>
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 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 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, 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
-6-
<PAGE>
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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By:
----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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>
EXHIBIT A-5
FORM OF CLASS C CERTIFICATE
FORM OF CLASS C MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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: Variable C Certificates as of the Closing
Date: $__________
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: March 1, 1998 of this Class C Certificate as of
the Closing Date: $____________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$_____________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services
Limited Partnership
Certificate No. 1 CUSIP No. ___________
<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., NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
CRIIMI MAE SERVICES LIMITED PARTNERSHIP, 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 IO CERTIFICATES, AND THE 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, AS AMENDED (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 G TO THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
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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 BALANCE OF THE CLASS A-1 CERTIFICATES,
CLASS A-2 AND CLASS B 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 D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J,
CLASS K AND CLASS L 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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), (or any successor
entity under the Agreement) and Norwest Bank Minnesota, National Association
(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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the
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<PAGE>
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 Norwest Bank Minnesota,
National Association, 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.
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.
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<PAGE>
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 the 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.
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
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<PAGE>
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 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, 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
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<PAGE>
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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class C Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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>
EXHIBIT A-6
FORM OF CLASS D CERTIFICATE
CLASS D MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
Pass-Through Class Principal Balance of the
Rate: Variable Class D Certificates as of the
Closing Date: $__________
Date of Pooling and Servicing Initial Certificate Principal
Agreement: March 1, 1998 Balance of this Class D
Certificate as of the Closing Date:
$__________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$__________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No. ______________
<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 THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 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, AS AMENDED (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 D CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE
THE PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A CERTIFICATION
SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
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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 BALANCE OF THE CLASS A-1, CLASS A-2,
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, CLASS J, CLASS K,
AND CLASS L 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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), and Norwest Bank
Minnesota, National Association (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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination Date), commencing on the
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<PAGE>
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 Norwest Bank Minnesota, National Association, 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.
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
-4-
<PAGE>
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 to execute a certification
substantially in the form of Exhibit G 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 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 Paying Agent or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes,
-5-
<PAGE>
and none of the Depositor, the Master Servicer, the Special Servicer, the
Trustee, 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, the Special 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, the Special 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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated: March 27, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By: _______________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class D Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
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>
EXHIBIT A-7
FORM OF CLASS E CERTIFICATE
CLASS E MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
Pass-Through Class Principal Balance of the
Rate: Variable Class E Certificates as of the
Closing Date: $__________
Date of Pooling and Servicing Initial Certificate Principal
Agreement: March 1, 1998 Balance of this Class E
Certificate as of the Closing
Date: $_____________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$___________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer: CUSIP No. ______________
CRIIMI MAE Services Limited
Partnership
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 THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 IO, 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, AS AMENDED (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 E CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE
THE PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A CERTIFICATION
SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
-2-
<PAGE>
CONDUIT" (A "REMIC") AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G
AND 860D OF THE CODE. THE FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE
PURPOSES OF APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID")
RULES TO THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 26, 1998.
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 FEBRUARY 25, 1998 AND THE PROSPECTUS
SUPPLEMENT DATED MARCH 19, 1998 RELATING TO THIS CERTIFICATE) OF 0% AND THAT THE
ARD LOANS ARE REPAID IN FULL ON THEIR RESPECTIVE ANTICIPATED REPAYMENT DATES AS
SET FORTH IN SUCH PROSPECTUS SUPPLEMENT (THE "PREPAYMENT ASSUMPTION"), THIS
CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $________ OF OID PER $1,000 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 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, CLASS J, CLASS K, AND CLASS
L 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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), and Norwest Bank
Minnesota, National Association (hereinafter called the
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<PAGE>
"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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 E 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 Norwest
Bank Minnesota, National Association, 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.
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<PAGE>
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 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 to execute a certification
substantially in the form of Exhibit G to the Agreement.
No service charge will be imposed for any registration of transfer or
exchange of Class E Certificates, but the
-5-
<PAGE>
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
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 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, the Special 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, the Special 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 E 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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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
-6-
<PAGE>
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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: ______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class E Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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
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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>
EXHIBIT A-8
FORM OF CLASS F CERTIFICATE
CLASS F MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
Pass-Through Class Principal Balance of the
Rate: _____% per annum Class F Certificates as of the
Closing Date: $___________
Date of Pooling and Servicing Initial Certificate Principal
Agreement: March 1, 1998 Balance of this Class F
Certificate as of the Closing
Date: $_________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$__________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer: CUSIP No. ______________
CRIIMI MAE Services Limited
Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 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 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.
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, AS AMENDED (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 (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 ITS REGISTRATION OF TRANSFER
OF A CLASS F CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO
REQUIRE THE PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A
CERTIFICATION SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
-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 CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 26, 1998. 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 FEBRUARY 25, 1998 AND THE PROSPECTUS SUPPLEMENT DATED MARCH 19,
1998 RELATING TO THIS CERTIFICATE) OF 0% AND THAT THE ARD LOANS ARE REPAID IN
FULL ON THEIR RESPECTIVE ANTICIPATED REPAYMENT DATES AS SET FORTH IN SUCH
PROSPECTUS SUPPLEMENT (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $________ OF OID PER $1,000 OF INITIAL CERTIFICATE
PRINCIPAL BALANCE, THE YIELD TO MATURITY IS ___% PER ANNUM, AND THE AMOUNT OF
OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____________ PER
$1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE EXACT
METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL 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 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, CLASS J AND CLASS K 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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the
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<PAGE>
"Special Servicer", which term includes any successor entity under the
Agreement), and Norwest Bank Minnesota, National Association (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 15th day of each month or, if such 15th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date") (provided,
however, that the Distribution Date will be no earlier than the fourth Business
Day following the related Determination 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 Norwest Bank Minnesota, National Association, 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.
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<PAGE>
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 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 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
F-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit F-2
or
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<PAGE>
Exhibit F-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 upon acquisition
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
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 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, the Special 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, the Special 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;
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<PAGE>
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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: ____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class F Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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>
EXHIBIT A-9
FORM OF CLASS G CERTIFICATE
CLASS G MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
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: March 1, 1998 Balance of this Class G
Certificate as of the Closing
Date: $_________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$_______________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer: CUSIP No. ______________
CRIIMI MAE Services Limited Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 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 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.
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, AS AMENDED (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 (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 ITS REGISTRATION OF TRANSFER
OF A CLASS G CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO
REQUIRE THE PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A
CERTIFICATION SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
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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. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 26, 1998. 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 FEBRUARY 25, 1998 AND THE PROSPECTUS SUPPLEMENT DATED MARCH 19,
1998 RELATING TO THIS CERTIFICATE) OF 0% AND THAT THE ARD LOANS ARE REPAID IN
FULL ON THEIR RESPECTIVE ANTICIPATED REPAYMENT DATES AS SET FORTH IN SUCH
PROSPECTUS SUPPLEMENT (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $________ OF OID PER $1,000 OF INITIAL CERTIFICATE
PRINCIPAL BALANCE, THE YIELD TO MATURITY IS ___% PER ANNUM, AND THE AMOUNT OF
OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____________ PER
$1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE EXACT
METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL 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 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, CLASS J, CLASS K, AND CLASS L
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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the
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<PAGE>
"Special Servicer", which term includes any successor entity under the
Agreement), and Norwest Bank Minnesota, National Association (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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 G 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 Norwest
Bank Minnesota, National Association, 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.
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<PAGE>
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 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 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
F-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit F-2
or
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<PAGE>
Exhibit F-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 upon acquisition
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
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 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, the Special 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, the Special 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;
-6-
<PAGE>
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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By:
---------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class G Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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>
EXHIBIT A-10
FORM OF CLASS H CERTIFICATE
CLASS H MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
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: March 1, 1998 Balance of this Class H
Certificate as of the Closing
Date: $___________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$_______________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer: CUSIP No. ______________
CRIIMI MAE Services Limited Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 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 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.
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, AS AMENDED (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 (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 ITS REGISTRATION OF TRANSFER
OF A CLASS H CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO
REQUIRE THE PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A
CERTIFICATION SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
-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 CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 26, 1998. 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 FEBRUARY 25, 1998 AND THE PROSPECTUS SUPPLEMENT DATED MARCH 19,
1998 RELATING TO THIS CERTIFICATE) OF 0% AND THAT THE ARD LOANS ARE REPAID IN
FULL ON THEIR RESPECTIVE ANTICIPATED REPAYMENT DATES AS SET FORTH IN SUCH
PROSPECTUS SUPPLEMENT (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $________ OF OID PER $1,000 OF INITIAL CERTIFICATE
PRINCIPAL BALANCE, THE YIELD TO MATURITY IS ___% PER ANNUM, AND THE AMOUNT OF
OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____________ PER
$1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE EXACT
METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL 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 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, CLASS K, AND CLASS L
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 the Agreement), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services
-3-
<PAGE>
Limited Partnership (in such capacity, hereinafter called the "Special
Servicer", which term includes any successor entity under the Agreement), and
Norwest Bank Minnesota, National Association (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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 Norwest
Bank Minnesota, National Association, 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
-4-
<PAGE>
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 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 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
-5-
<PAGE>
in the form attached as Exhibit F-1 to the Agreement, and a certificate from
such Certificateholder's prospective transferee substantially in the form
attached as either Exhibit F-2 or Exhibit F-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 upon acquisition 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
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 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, the Special 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, the Special Servicer or
-6-
<PAGE>
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 H 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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By:
--------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class H Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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>
EXHIBIT A-11
FORM OF CLASS J CERTIFICATE
CLASS J MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
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: March 1, 1998 Balance of this Class J
Certificate as of the Closing
Date: $_________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$______________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer: CUSIP No. _______________
CRIIMI MAE Services Limited Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 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 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.
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, AS AMENDED (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 (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 ITS REGISTRATION OF TRANSFER
OF A CLASS J CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO
REQUIRE THE PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A
CERTIFICATION SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
-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 CODE. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 26, 1998. 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 FEBRUARY 25, 1998 AND THE PROSPECTUS SUPPLEMENT DATED MARCH 19,
1998 RELATING TO THIS CERTIFICATE) OF 0% AND THAT THE ARD LOANS ARE REPAID IN
FULL ON THEIR RESPECTIVE ANTICIPATED REPAYMENT DATES AS SET FORTH IN SUCH
PROSPECTUS SUPPLEMENT (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $________ OF OID PER $1,000 OF INITIAL CERTIFICATE
PRINCIPAL BALANCE, THE YIELD TO MATURITY IS ___% PER ANNUM, AND THE AMOUNT OF
OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____________ PER
$1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE EXACT
METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL 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 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, IF
THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS K 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 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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services
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<PAGE>
Limited Partnership (in such capacity, hereinafter called the "Special
Servicer", which term includes any successor entity under the Agreement), and
Norwest Bank Minnesota, National Association (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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 Norwest
Bank Minnesota, National Association, 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
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<PAGE>
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 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 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
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<PAGE>
in the form attached as Exhibit F-1 to the Agreement, and a certificate from
such Certificateholder's prospective transferee substantially in the form
attached as either Exhibit F-2 or Exhibit F-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 upon acquisition 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
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 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, the Special 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, the Special Servicer or
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<PAGE>
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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By:
---------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class J Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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>
EXHIBIT A-12
FORM OF CLASS K CERTIFICATE
CLASS K MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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.
Pass-Through Class Principal Balance of the Class
Rate: _____% per annum K Certificates as of the Closing
Date: $_________
Date of Pooling and Servicing Initial Certificate Principal
Agreement: March 1, 1998 Balance of this Class K
Certificate as of the Closing
Date: $_________
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$_________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer: CUSIP No. _______________
CRIIMI MAE Services Limited
Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 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 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.
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, AS AMENDED (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 (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 ITS REGISTRATION OF TRANSFER
OF A CLASS K CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO
REQUIRE THE PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A
CERTIFICATION SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
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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. THE
FOLLOWING INFORMATION IS PROVIDED SOLELY FOR THE PURPOSES OF APPLYING THE U.S.
FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT ("OID") RULES TO THIS CERTIFICATE.
THE ISSUE DATE OF THIS CERTIFICATE IS MARCH 26, 1998. 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 FEBRUARY 25, 1998 AND THE PROSPECTUS SUPPLEMENT DATED MARCH 19,
1998 RELATING TO THIS CERTIFICATE) OF 0% AND THAT THE ARD LOANS ARE REPAID IN
FULL ON THEIR RESPECTIVE ANTICIPATED REPAYMENT DATES AS SET FORTH IN SUCH
PROSPECTUS SUPPLEMENT (THE "PREPAYMENT ASSUMPTION"), THIS CERTIFICATE HAS BEEN
ISSUED WITH NO MORE THAN $________ OF OID PER $1,000 OF INITIAL CERTIFICATE
PRINCIPAL BALANCE, THE YIELD TO MATURITY IS ___% PER ANNUM, AND THE AMOUNT OF
OID ATTRIBUTABLE TO THE INITIAL ACCRUAL PERIOD IS NO MORE THAN $____________ PER
$1,000 OF INITIAL CERTIFICATE PRINCIPAL BALANCE, COMPUTED UNDER THE EXACT
METHOD. NO REPRESENTATION IS MADE THAT THE MORTGAGE LOANS WILL 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 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, 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 K Certificate (obtained
by dividing the principal amount of this Class K Certificate (its "Certificate
Principal Balance") as of the Closing Date by the aggregate principal amount of
all the Class K Certificates (their "Class Principal Balance") as of the Closing
Date) in that certain beneficial ownership interest evidenced by all the Class K
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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), and Norwest Bank
Minnesota, National Association (hereinafter called the "Trustee", which term
includes any successor entity
-3-
<PAGE>
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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 K Certificates on
the applicable Distribution Date pursuant to the Agreement. All distributions
made under the Agreement on this Class K Certificate will be made by Norwest
Bank Minnesota, National Association, 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.
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<PAGE>
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 K 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 K
Certificates are exchangeable for new Class K 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 K Certificates in authorized
denominations evidencing the same aggregate Percentage Interest will be issued
to the designated transferee or transferees.
No transfer of any Class K 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 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 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
F-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit
F-2 or
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<PAGE>
Exhibit F-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 K
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 K Certificate without registration or qualification. Any Class K
Certificateholder desiring to effect such a transfer shall, and upon acquisition
of its Class K 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 K 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 K
Certificates.
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 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 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, the Special 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, the Special 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 K Certificates;
-6-
<PAGE>
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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: ______________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class K Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
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>
EXHIBIT A-13
FORM OF CLASS L CERTIFICATE
CLASS L MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in the Additional Interest included
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.
Percentage Interest evidenced by
this Class L Certificate: _____%
Date of Pooling and Servicing
Agreement: March 1, 1998
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date:
$___________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 EVIDENCES AN UNDIVIDED BENEFICIAL OWNERSHIP INTEREST IN THE
ADDITIONAL INTEREST DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS 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.
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, AS AMENDED (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).
This certifies that _________________ is the registered owner of the
Percentage Interest on the face of this Certificate specified in that certain
beneficial ownership interest evidenced by all the Class L 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), First Union National Bank (in such capacity, hereinafter
called the "Master Servicer", which term includes any successor entity under the
Agreement), CRIIMI MAE Services Limited Partnership (in such capacity,
hereinafter called the "Special Servicer", which term includes any successor
entity under the Agreement), and Norwest Bank Minnesota, National Association
(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,
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<PAGE>
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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 L Certificates on
the applicable Distribution Date pursuant to the Agreement. All distributions
made under the Agreement on this Class L Certificate will be made by Norwest
Bank Minnesota, National Association, 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 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.
The Certificates are limited in right of distribution to certain
collections and recoveries of the Additional Interest paid on certain of the
Mortgage Loans, all as more specifically set forth herein and in the Agreement.
Any distribution to the Holder of this Certificate 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 L Certificates are issuable in fully registered form only without
coupons. As provided in the Agreement and subject to certain limitations therein
set forth, Class L Certificates are exchangeable for new Class L
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<PAGE>
Certificates in 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 L Certificates evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.
No transfer of any Class L 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 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 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
F-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit F-2
or Exhibit F-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 L
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 L Certificate without registration or qualification. Any Class L
Certificateholder desiring to effect such a transfer shall, and upon acquisition
of its Class L 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 L Certificates, but the
-4-
<PAGE>
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 L Certificates.
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 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 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, the Special 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, the Special 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 L 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 Cut-Off Date.
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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. The Agreement also permits the
amendment thereof, in certain limited circumstances, including any amendment
necessary to maintain the status of a portion of the Trust Fund 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.
-5-
<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.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated: March 28, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
By: ______________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class L Certificates referred to in the within-mentioned
Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Certificate Registrar
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>
EXHIBIT A-14
FORM OF CLASS R-I CERTIFICATE
CLASS R-I MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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: March 1, 1998 this Class R-I Certificate: _____%
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date: $___________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 ALL OF THE REMIC I REGULAR INTERESTS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS 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.
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, AS AMENDED (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 ITS REGISTRATION OF TRANSFER OF A CLASS R-I
CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE THE
PROSPECTIVE TRANSFEREE OF SUCH CERTIFICATE TO EXECUTE A CERTIFICATION
SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL
TAX-RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH TRANSFER
RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE.
-2-
<PAGE>
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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), and Norwest Bank
Minnesota, National Association (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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date") (provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 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
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<PAGE>
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, 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 as
authorized in the Agreement 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 F-1 to the Agreement, and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
either Exhibit F-2 or Exhibit F-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
-4-
<PAGE>
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 upon acquisition 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 to execute a
certification substantially in the form of Exhibit G 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 Norwest Bank Minnesota, National Association, 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
proposed Transfer of any Ownership Interest in this Certificate, the Certificate
Registrar shall require delivery to it, and shall not register the Transfer of
this Certificate until its receipt of, an affidavit and agreement substantially
in the form attached as Exhibit H-1 to the Agreement (a "Transfer Affidavit and
Agreement") from the proposed Transferee, 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
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<PAGE>
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 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 H-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of Temporary Treasury Regulations 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 doing so 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 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
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<PAGE>
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
whose income is includible in gross income for United States federal income tax
purposes regardless of its source, 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.
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, 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 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
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<PAGE>
the Trust Fund, and (ii) the purchase by the Master Servicer, the Special
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, the Special
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 Cut-Off 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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Authentication 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>
EXHIBIT A-15
FORM OF CLASS R-II CERTIFICATE
CLASS R-II MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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: March 1, 1998 this Class R-II Certificate: _____%
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Cut-Off Date: $___________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 ALL OF THE REMIC II REGULAR INTERESTS
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS 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.
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, AS AMENDED (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 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 TO EXECUTE A CERTIFICATION
SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL
TAX-RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH TRANSFER
RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE.
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<PAGE>
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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), and Norwest Bank
Minnesota, National Association (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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date")(provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 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
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<PAGE>
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, 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
as authorized in the Agreement, 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 or qualification. If a Transfer of any R-II 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 F-1 to the Agreement, and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
either Exhibit F-2 or Exhibit F-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
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<PAGE>
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 upon acquisition 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 to execute a
certification substantially in the form of Exhibit G 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 Norwest Bank Minnesota, National Association, 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
proposed Transfer of any Ownership Interest in this Certificate, the Certificate
Registrar shall require delivery to it, and shall not register the Transfer of
this Certificate until its receipt of, an affidavit and agreement substantially
in the form attached as Exhibit H-1 to the Agreement (a "Transfer Affidavit and
Agreement") from the proposed Transferee, 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
-5-
<PAGE>
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 H-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of Temporary Treasury Regulations 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 doing so 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 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
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<PAGE>
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
whose income is includible in gross income for United States federal income tax
purposes regardless of its source, 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.
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, 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 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
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<PAGE>
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, the Special 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, the Special 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 Cut-Off 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
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer 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. 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: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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
-10-
<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.
-11-
<PAGE>
EXHIBIT A-16
FORM OF CLASS R-III CERTIFICATE
CLASS R-III MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
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: March 1, 1998 this Class R-III Certificate: _____%
Closing Date: March 27, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans as of
the Cut-Off Date: $________________
First Distribution Date:
April 16, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services
Limited Partnership
Certificate No. 1
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN THE
DEPOSITOR, THE UNDERWRITERS, THE MASTER SERVICER, THE SPECIAL SERVICER, THE
TRUSTEE, THE MORTGAGE LOAN SELLERS OR ANY OF THEIR 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 IO, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J, CLASS K, AND
CLASS L CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS 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.
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, AS AMENDED (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 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 TO EXECUTE A CERTIFICATION
SUBSTANTIALLY IN THE FORM OF EXHIBIT G TO THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH TRANSFER
RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN,
-2-
<PAGE>
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), First Union National Bank
(in such capacity, hereinafter called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, hereinafter called the "Special Servicer", which
term includes any successor entity under the Agreement), and Norwest Bank
Minnesota, National Association (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
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (each, a "Distribution Date")(provided, however, that
the Distribution Date will be no earlier than the fourth Business Day following
the related Determination 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 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.
-3-
<PAGE>
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, 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 as authorized in the Agreement 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-III 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 or qualification. If a Transfer of any R-II Certificate is to be
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
F-1 to the Agreement, and a certificate from such Certificateholder's
prospective transferee substantially in the form attached as either Exhibit F-2
or Exhibit F-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
-4-
<PAGE>
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 upon acquisition
of its Class R-III 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 to execute a
certification substantially in the form of Exhibit G 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 Norwest Bank Minnesota, National Association, 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
proposed Transfer of any Ownership Interest in this Certificate, the Certificate
Registrar shall require delivery to it, and shall not register the Transfer of
this Certificate until its receipt of, an affidavit and agreement substantially
in the form attached as Exhibit H-1 to the Agreement (a "Transfer Affidavit and
Agreement") from the
-5-
<PAGE>
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 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 H-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of Temporary Treasury Regulations 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 doing so 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-III 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 Class R-III 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
-6-
<PAGE>
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
whose income is includible in gross income for United States federal income tax
purposes regardless of its source, 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.
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, 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 Paying Agent, the
Certificate Registrar or any such agent shall be affected by notice to the
contrary.
-7-
<PAGE>
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, the Special 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, the Special 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 Cut-Off 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 rights
of the Certificateholders under the Agreement at any time by the Depositor, the
Master Servicer, the Special Servicer 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. 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.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this Certificate
to be duly executed.
Dated: March 27, 1998
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
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.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Authenticating Agent
By:
---------------------------------------
Authorized Officer
-9-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Mortgage Pass-Through Certificate and hereby authorize(s) the registration of
transfer of such interest to assignee on the Certificate Register of the Trust
Fund.
I (we) further direct the Certificate Registrar to issue a new Mortgage
Pass-Through Certificate of a like Percentage Interest and Class to the above
named assignee and deliver such Mortgage Pass-Through Certificate to the
following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_______________________________________________
Signature by or on behalf of Assignor
_______________________________________________
Signature Guaranteed
-10-
<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.
-11-
<PAGE>
EXHIBIT B
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
100 10000 Old Katy Road Office/Service Center 10000 Old Katy Road Houston TX 77055
101 1031 South Santa Fe Avenue 1031 South Santa Fe Avenue Vista CA 92083
102 200 South La Brea Retail Center 200 South La Brea Avenue Los Angeles CA 90036
103 3000/3100 Carlisle Buildings 3000/3100 Carlisle Dallas TX 75204
104 380/400 Woodview Avenue 380/400 Woodview Avenue Morgan Hill CA 95037
105 518 Raymond Avenue 518 Raymond Avenue Santa Monica CA 90405
106 524 Raymond Avenue 524 Raymond Avenue Santa Monica CA 90405
107 650 Selig Drive Facility 650 Selig Drive Atlanta GA 30041
108 8000 Centre Park 8000 Centre Park Drive Austin TX 78754
109 AAAAA Rent-A-Space - Hayward 24700 Mission Blvd Hayward CA 94544
110 Antioch Ramada Inn 2436 Mahogany Way Antioch CA 94507
111 Applewood Grove Shopping Center 1975 Youngfield Street Golden CO 80401
112 Arbor Oaks Apartments 3434 & 3500 West Little York Houston TX 77091
113 Atrium at Chesterfield 16305 Swingley Ridge Drive St. Louis MO 63017
114 Avondale Apartments 1st Avenue and Route 41 Avondale PA 19311
115 Bay Pointe South Apartments 4613 Bayshore Drive Naples FL 34112
116 Belcourt Apartments 3117 North 7th Avenue Phoenix AZ 85013
117 Best Western-LaPorte 705 Hwy I-45 South La Porte TX 77571
118 Best Western - Pearl 257 S Pearson Road Pearl MS 39208
119 Best Western Anahiem Hills 5710 East La Palma Avenue Anaheim CA 92807
120 Brea Plaza 1555-1643 Imperial Hwy/
409-477 Associated Road Brea CA 92621
121 Briarbend Apartments 349 Briarbend New Braunfels TX 78130
122 Briergreen Apartments 3 Saw Grass Road Charleston SC 29412
123 Broadmoor Mobile Home Park 55 West Washington Street Yakima WA 98903
124 Butler Pike Office Building 4070 Butler Pike Plymouth PA 19444
125 Cambridge Park Apts 2259 Bonaparte Blvd. Montgomery AL 36116
126 Canyon Crest Shopping Center Canyon Crest & Central Ave Riverside CA 92507
127 Carlsbad Inn 3075 Carlsbad Boulevard Carlsbad CA 92008
128 Carlsbad Ramada Inn 751 Macadamia Drive Carlsbad CA 92009
129 Cedar Apartments 424-534 37th Street SE Auburn WA 98002
130 Cedars Apartments 403 Longmire Conroe TX 77304
131 Cedarvale Highlands 3908/3916/3924 Beau d'Rue Dr. Eagan MN 55122
133 Chambers Cove Apartments 201-272 Chambers Cove Drive Macon GA 31206
134 Chandler Village Phase I & II NE Corner Chandler Blvd @ 54th St. Chandler AZ 85226
135 Charles-Orms Building 10 Orms Street Providence RI 02904
136 Chateau De Vie Apartments 1521 Reagan Hill Austin TX 78752
137 Chelsea Mini Storage 224 12th Street New York NY 10001
138 Cimarron Pointe Apartments 8301 North Council Road Oklahoma City OK 73132
139 Clarkstown Executive Park 704 & 706 Executive Blvd./
612 & 614 Corporate Way Valley Cottage NY 10989
140 Comfort Inn - Dallas 8901 East R L Thornton Freeway Dallas TX 75228
141 Comfort Inn - Greenwood 1215 E.Highway 72 Bypass Greenwood SC 29649
142 Comfort Inn - Indiana 3801 N. Frontage Road Michigan City IN 46360
143 Comfort Inn - Vicksburg 3959 East Clay Street Vicksburg MS 39180
144 Comfort Inn Jackson 2800 Greenway Drive Jackson MS 39204
145 Comfort Inn Ruston 1801 N Service Road Ruston LA 71270
146 Comfort Suites - Stafford 4820 Techniplex Drive Stafford TX 77477
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------ MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
100 2,730,161.67 21,682.38 8.250 113 293 08/01/2007 No Balloon
101 976,665.13 7,639.22 8.000 117 297 12/01/2007 No Balloon
102 5,238,721.73 37,466.63 7.710 117 357 12/01/2007 No Balloon
103 1,989,223.34 15,343.70 7.930 115 295 10/01/2007 No Balloon
104 2,096,001.55 14,488.64 7.260 82 358 01/01/2005 No HyperAm
105 1,023,900.59 7,677.98 7.490 175 295 10/01/2012 No Balloon
106 1,033,841.40 7,752.52 7.490 175 295 10/01/2012 No Balloon
107 6,585,217.39 49,332.88 7.630 178 298 01/01/2013 No Balloon
108 3,202,341.25 24,169.07 7.850 116 320 11/01/2007 No Balloon
109 3,393,201.20 26,989.31 8.330 298 298 01/01/2023 No Fully Amortizing
110 2,532,591.98 23,049.45 9.010 113 233 08/01/2007 No HyperAm
111 2,252,034.76 17,237.43 7.750 117 297 12/01/2007 No Balloon
112 2,992,591.28 21,158.49 7.480 177 357 12/01/2012 No Balloon
113 13,485,479.70 93,476.85 7.280 117 357 12/01/2007 No HyperAm
114 1,074,276.87 8,519.52 8.780 111 351 06/01/2007 No Balloon
115 4,776,012.97 34,520.56 7.790 113 353 08/01/2007 No Balloon
116 3,161,678.32 25,896.78 8.560 48 288 03/01/2002 No Balloon
117 1,341,074.68 11,985.58 8.690 236 236 11/01/2017 No Fully Amortizing
118 1,691,212.92 14,656.32 8.290 237 237 12/01/2017 Yes Fully Amortizing
119 2,155,295.52 18,564.48 8.250 239 239 02/01/2018 Yes Fully Amortizing
120 13,193,866.61 99,521.55 8.010 79 325 10/01/2004 No Balloon
121 1,296,969.38 8,912.42 7.300 117 357 12/01/2007 No Balloon
122 3,139,459.73 22,039.00 7.400 116 356 11/01/2007 No Balloon
123 2,844,506.86 19,486.24 7.170 118 358 01/01/2008 No Balloon
124 2,096,076.13 14,692.33 7.400 118 358 01/01/2008 No HyperAm
125 3,497,970.15 27,635.90 7.560 260 260 11/01/2019 No Fully Amortizing
126 18,964,066.65 131,744.78 7.310 118 358 01/01/2008 No HyperAm
127 3,975,001.18 35,348.43 8.750 116 236 11/01/2007 No HyperAm
128 3,976,960.84 36,194.84 9.010 113 233 08/01/2007 No HyperAm
129 1,376,411.09 9,436.50 7.170 117 357 12/01/2007 No Balloon
130 2,245,651.49 15,352.90 7.150 118 358 01/01/2008 No Balloon
131 2,927,347.12 21,062.52 7.750 114 354 09/01/2007 No Balloon
133 2,145,273.70 16,589.35 7.830 114 294 09/01/2007 No Balloon
134 2,338,090.46 18,622.90 8.310 115 295 10/01/2007 No Balloon
135 3,934,687.24 29,730.59 8.270 114 354 09/01/2007 No Balloon
136 1,782,058.45 13,496.89 7.730 80 296 11/01/2004 No Balloon
137 16,047,887.96 150,053.42 7.380 177 177 12/01/2012 No Fully Amortizing
138 5,378,367.21 37,170.05 7.350 116 356 11/01/2007 No Balloon
139 11,238,226.77 86,020.93 7.840 115 295 10/01/2007 No Balloon
140 1,391,531.21 12,605.17 9.010 236 236 11/01/2017 No Fully Amortizing
141 1,692,325.97 15,317.21 9.020 237 237 12/01/2017 No Fully Amortizing
142 1,490,196.96 13,426.34 8.800 236 236 11/01/2017 No Fully Amortizing
143 2,188,628.49 18,967.00 8.290 237 237 12/01/2017 No Fully Amortizing
144 2,576,612.61 22,329.34 8.290 237 237 12/01/2017 No Fully Amortizing
145 2,089,145.37 18,104.87 8.290 237 237 12/01/2017 No Fully Amortizing
146 1,990,058.03 17,041.31 8.250 117 237 12/01/2007 No HyperAm
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
100 0.095 MLMC First Union 30/360
101 0.125 MLMC MLCC Actual/360
102 0.095 MLMC L.J. Melody 30/360
103 0.095 MLMC First Union 30/360
104 0.095 MLMC L.J. Melody Actual/360
105 0.095 MLMC First Union Actual/360
106 0.095 MLMC First Union Actual/360
107 0.095 MLMC L.J. Melody 30/360
108 0.095 MLMC First Union Actual/360
109 0.125 MLMC MLCC 30/360
110 0.095 MLMC First Union 30/360
111 0.095 MLMC First Union Actual/360
112 0.095 MLMC First Union Actual/360
113 0.095 MLMC First Union Actual/360
114 0.095 MLMC First Union 30/360
115 0.095 MLMC First Union 30/360
116 0.095 MLMC First Union 30/360
117 0.095 MLMC First Union Actual/360
118 0.095 MLMC First Union Actual/360
119 0.125 MLMC MLCC Actual/360
120 0.095 MLMC First Union 30/360
121 0.095 MLMC L.J Melody 30/360
122 0.095 MLMC First Union Actual/360
123 0.095 MLMC L.J. Melody Actual/360
124 0.095 MLMC First Union Actual/360
125 0.095 MLMC First Union Yes Actual/360
126 0.095 MLMC L.J. Melody Actual/360
127 0.090 MLMC GCAM 30/360
128 0.095 MLMC First Union 30/360
129 0.125 MLMC MLCC Actual/360
130 0.095 MLMC L.J. Melody Actual/360
131 0.235 MLMC Arbor 30/360
133 0.095 MLMC First Union Actual/360
134 0.095 MLMC Robert C. Wilson 30/360
135 0.095 MLMC First Union 30/360
136 0.095 MLMC First Union 30/360
137 0.095 MLMC First Union Actual/360
138 0.095 MLMC First Union Actual/360
139 0.095 MLMC First Union 30/360
140 0.095 MLMC First Union 30/360
141 0.095 MLMC First Union 30/360
142 0.095 MLMC First Union Actual/360
143 0.095 MLMC First Union Actual/360
144 0.095 MLMC First Union Actual/360
145 0.095 MLMC First Union Actual/360
146 0.125 MLMC MLCC 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
147 Commons at Briargate 2845 Freewood Point Colorado Springs CO 80920
148 Commons of Laporte 2400 Andrew Laporte IN 46350
149 Copper Hill Apartments 3440 El Dorado Hills Blvd El Dorado Hills CA 95762
150 Costa Neuporte Senior Apartments 2283 Fairview Road Costa Mesa CA 92627
151 Courts at West University 3810 Law Houston TX 77005
152 Courtside/Harrigan's Plaza 5900, 5920 & 5930 West I-20 Arlington TX 76017
153 Creekwood Apartments 710 North 46th Street Killeen TX 76543
154 Crystal Cove Apartments 15615 Blue Ash Drive Houston TX 77090
155 Days Inn 914 Riverview Road Rock Hill SC 29730
156 Days Inn-Fresno 4061 N. Blackstone Avenue Fresno CA 93726
157 Days Inn - Alice 555 N. Johnson Alice TX 78332
158 Days Inn - Southeast 1850 Embassy Square Blvd. Forest Hills KY 40299
159 Days Inn-Lawrenceville 731 West Pike Street Lawrenceville GA 30245
160 DFW Corporate Park 2100 Highway 360 Grand Prairie TX 75050
161 Dickson Kroger Shopping Center Highway 70-Bypass Dickson TN 37055
163 Econo Lodge 962 Riverview Road Rock Hill SC 29730
164 Edgemont Plaza 3071-3167 Provo Canyon Rd/3060 North St. Provo UT 84604
165 Embassy Plaza 6050-6140 Lankershim Blvd North Hollywood CA 91606
166 Evergreen Ridge Apartments 3815 Susan Drive San Bruno CA 94066
167 Farnham Park Office Building 7887 San Felipe Houston TX 77063
168 Forest Park Apartment 303 Des Plaines and 7456 Washington Forest Park IL 60130
169 Fossil Hill Apartments 5700 N. Beach Street Haltom City TX 76137
170 Gannon Place Apartments 3839 Gannon Lane Dallas TX 75237
171 Garden View 16200 West Nine Mile Road Southfield MI 48075
172 Gardens Apartments 1420 17th Street SE Auburn WA 98002
173 Gardenwood Apartments 1400 Gardenia St. San Antonio TX 78201
174 Garfield Villas & Hillcrest Apts. 5150-5220 East 88th Street Garfield Heights OH 44125
175 Goff Building 321 West Main Street Clarksburg WV 26301
176 Hampton Inn - Greensboro 7803 National Service Road Greensboro NC 27409
177 Hampton Inn - Newnan 50 Hampton Way Newnan GA 30265
178 Hampton Inn Peachtree 300 Westpark Drive Peachtree City GA 30269
179 Harvey's Racquet Club Apts 3301 Hudnall Street Dallas TX 75235
180 Hillview Apartments 200 Shalimar Drive Glascow KY 42141
181 Holiday Inn - Brainerd 2025 South 6th Street Brainerd MN 56401
182 Holiday Inn Express - Arlington 2451 Randoll Mill Road Arlington TX 76011
183 Holiday Inn Express - Brentwood 8820 Brentwood Blvd. Brentwood CA 94513
184 Holiday Inn Express - Brownsburg 31 Maplehurst Drive Brownsburg IN 46112
185 Holiday Inn Express - Columbia 1554 Bear Creek Pike Columbia TN 38401
186 Holiday Inn Express - Edinburg 1806 S Closner Blvd Edinburg TX 78539
187 Holiday Inn Express - Goose Creek 103 Redbank Road Goose Creek SC 29445
188 Holmes Center Office Building 3251 W. 6th Street Los Angeles CA 90020
189 Horizon Court Office Building 7450 Horizon Drive Columbus OH 48235
190 Howard Johnson San Mateo 2110 South El Camino Real San Mateo CA 94403
191 Hub Apartments 3136 Hudnall Dallas TX 75235
192 KAR Printing Building 13930 NW 60th Avenue Miami Lakes FL 33014
193 La Costa Apartments 4303 Mariposa Drive Irving TX 75038
194 Lackawanna Station Shopping Plaza One Lackawanna Plaza Montclair NJ 07042
195 Lake Forest Business Park 22512 Aspen St, / 23901 Remme Ridge Lake Forest CA 92630
196 Lake Shore Park Apartments Lake Shore Drive Watervliet NY 12189
197 Lancaster East Shopping Center East Lancaster & Edgewood Fort Worth TX 76112
198 Lawrence Shopping Center 2495 U.S. Route 1 Lawrenceville NJ 08648
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ----------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
147 13,589,232.59 96,191.64 7.580 78 354 09/01/2004 No Balloon
148 4,381,410.55 29,683.87 7.060 118 358 01/01/2008 No Balloon
149 2,495,220.54 17,196.60 7.230 118 358 01/01/2008 No Balloon
150 4,381,549.50 31,918.32 7.880 114 354 09/01/2007 No Balloon
151 2,990,545.17 21,636.56 7.400 117 321 12/01/2007 No Balloon
152 2,693,447.29 19,229.41 7.580 117 357 12/01/2007 No Balloon
153 1,491,461.90 12,118.41 7.430 237 237 12/01/2017 No Fully Amortizing
154 3,386,749.97 24,098.88 7.530 115 355 10/01/2007 No Balloon
155 1,739,206.15 16,247.38 9.310 236 236 11/01/2017 No Fully Amortizing
156 1,472,578.56 13,016.58 8.560 237 237 12/01/2017 No Fully Amortizing
157 1,694,592.12 14,806.84 8.550 238 238 01/01/2018 No Fully Amortizing
158 1,789,084.14 16,183.49 8.990 236 236 11/01/2017 No Fully Amortizing
159 997,132.35 9,236.58 9.370 238 238 01/01/2018 No Fully Amortizing
160 8,785,813.87 59,138.81 7.100 118 358 01/01/2008 No Balloon
161 3,239,282.90 23,440.80 7.820 115 355 10/01/2007 No HyperAm
163 2,087,047.40 19,496.85 9.310 236 236 11/01/2017 No Fully Amortizing
164 1,844,324.65 13,167.88 7.320 117 327 12/01/2007 No Balloon
165 5,380,043.59 40,946.06 8.000 176 326 11/01/2012 No Balloon
166 14,263,427.09 98,770.86 7.270 177 357 12/01/2012 No Balloon
167 1,413,680.42 11,221.71 8.160 116 296 11/01/2007 No Balloon
168 3,593,126.90 24,787.95 7.240 118 358 01/01/2008 No Balloon
169 6,487,282.14 43,951.06 7.060 82 358 01/01/2005 No Balloon
170 4,072,221.04 28,121.18 7.250 118 358 01/01/2008 No Balloon
171 2,401,202.27 17,980.45 7.500 117 297 12/01/2007 No Balloon
172 2,595,125.59 18,145.37 7.375 118 358 01/01/2008 No Balloon
173 1,197,730.54 8,320.72 7.310 118 358 01/01/2008 No Balloon
174 1,914,568.32 13,794.94 7.780 116 356 11/01/2007 No Balloon
175 1,970,006.98 16,270.49 8.870 174 306 08/01/2012 No Balloon
176 4,430,539.87 33,816.90 7.820 116 296 11/01/2007 No HyperAm
177 3,744,081.85 33,283.77 8.700 114 234 09/01/2007 No Balloon
178 2,467,089.43 23,189.12 9.430 231 231 06/01/2017 No Fully Amortizing
179 6,262,958.36 49,619.09 8.470 75 315 06/01/2004 No Balloon
180 997,589.16 7,154.16 7.625 117 357 12/01/2007 No Balloon
181 3,542,197.24 30,167.76 8.100 239 239 02/01/2018 No Fully Amortizing
182 2,586,576.02 22,432.20 8.300 237 237 12/01/2017 No Fully Amortizing
183 1,741,165.32 15,323.47 8.500 237 237 12/01/2017 No Fully Amortizing
184 2,600,558.83 22,716.44 8.420 238 238 01/01/2018 No Fully Amortizing
185 1,691,818.47 14,763.76 8.510 237 237 12/01/2017 No Fully Amortizing
186 1,760,938.03 15,356.26 8.375 237 237 12/01/2017 No Fully Amortizing
187 1,542,497.79 13,949.20 8.875 237 237 12/01/2017 No Fully Amortizing
188 2,327,142.98 16,575.54 7.570 119 359 02/01/2008 No Balloon
189 11,938,392.28 94,453.69 8.230 115 295 10/01/2007 No Balloon
190 2,285,715.37 20,398.78 8.800 236 236 11/01/2017 No Fully Amortizing
191 6,932,926.25 54,926.99 8.470 75 315 06/01/2004 No Balloon
192 1,572,489.25 12,053.50 7.790 299 299 02/01/2023 No Fully Amortizing
193 2,890,408.48 20,431.17 7.470 116 356 11/01/2007 No Balloon
194 10,386,646.32 69,247.90 6.910 119 359 02/01/2008 No Balloon
195 6,373,853.73 47,005.56 8.010 114 354 09/01/2007 No Balloon
196 8,257,688.50 59,118.45 7.690 113 353 08/01/2007 No Balloon
197 1,594,667.56 12,032.79 7.700 117 297 12/01/2007 No Balloon
198 13,898,025.04 109,822.28 8.190 113 293 08/01/2007 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
147 0.095 MLMC First Union 30/360
148 0.095 MLMC First Union Actual/360
149 0.095 MLMC L.J. Melody Actual/360
150 0.095 MLMC First Union 30/360
151 0.095 MLMC First Union Actual/360
152 0.095 MLMC L.J. Melody Actual/360
153 0.095 MLMC First Union Actual/360
154 0.095 MLMC First Union Actual/360
155 0.095 MLMC First Union Actual/360
156 0.125 MLMC MLCC Actual/360
157 0.125 MLMC MLCC 30/360
158 0.095 MLMC First Union 30/360
159 0.125 MLMC MLCC 30/360
160 0.095 MLMC L.J. Melody 30/360
161 0.090 MLMC GCAM Actual/360
163 0.095 MLMC First Union Actual/360
164 0.095 MLMC Robert C. Wilson Actual/360
165 0.095 MLMC First Union Actual/360
166 0.095 MLMC First Union Actual/360
167 0.095 MLMC First Union Actual/360
168 0.095 MLMC First Union Actual/360
169 0.095 MLMC L.J. Melody Actual/360
170 0.095 MLMC First Union Actual/360
171 0.125 MLMC MLCC Actual/360
172 0.095 MLMC L.J. Melody Actual/360
173 0.095 MLMC First Union Actual/360
174 0.245 MLMC Arbor Actual/360
175 0.095 MLMC First Union 30/360
176 0.090 MLMC GCAM 30/360
177 0.090 MLMC GCAM 30/360
178 0.090 MLMC GCAM 30/360
179 0.095 MLMC Robert C. Wilson 30/360 Cntrl #'s 191, 216
180 0.095 MLMC First Union Actual/360
181 0.095 MLMC First Union Actual/360
182 0.095 MLMC First Union Actual/360
183 0.095 MLMC First Union Actual/360
184 0.125 MLMC MLCC Actual/360
185 0.095 MLMC First Union 30/360
186 0.095 MLMC First Union Actual/360
187 0.095 MLMC First Union Actual/360
188 0.095 MLMC First Union Actual/360
189 0.095 MLMC First Union 30/360
190 0.095 MLMC First Union 30/360
191 0.095 MLMC Robert C. Wilson 30/360 Cntrl #'s T121179, 216
192 0.095 MLMC L.J. Melody Actual/360
193 0.095 MLMC First Union Actual/360
194 0.095 MLMC First Union Actual/360
195 0.095 MLMC First Union 30/360
196 0.095 MLMC First Union 30/360
197 0.095 MLMC L.J. Melody 30/360
198 0.095 MLMC First Union 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
199 Learwood Square Shopping Center Lear/Nagel and Walker Roads Avon Lake OH 44012
200 Little Saigon Plaza II 9842 Bolsa Ave. Westminster CA 92683
201 Madison Parke Apartments 10501 Steppington Drive Dallas TX 75230
202 Martin Plaza 2420 Martin Blvd Fairfield CA 94533
203 Meadow Oaks Apartments 7770 Meadow Road Dallas TX 75231
204 Meadows Centre 8230-8350 West 80 Blvd. Arvada CO 80005
205 Mesa Tech Industrial/R&D Building 10540 Heater Court San Diego CA 92121
206 Metric Place 1921 Cedar Bend Drive Austin TX 78758
207 Michael's Aurora Plaza 15151 East Mississippi Avenue Aurora CO 80012
208 Mission Bell Plaza 453-593 W. Los Angeles Avenue Moorpark CA 93021
209 Modesto Ramada Inn 2001 West Orangeburg Avenue Modesto CA 95350
210 Monroe Town Center 337 Applegarth Road Cranbury NJ 08520
211 Newport Landing Apartments 10850 Kingsley Road Dallas TX 75238
212 Northwood Hills Apartments 13980 Peyton Dr. Dallas TX 75240
213 Office Court at St Michael's 460 St. Michael's Drive Santa Fe NM 87505
214 Office Max 7610 S Kentucky Oklahoma City OK 73159
215 Oliver Corners Shopping Center Hesperian Blvd & West Hayward CA 94545
216 Park Apartments 5414 Cedar Springs Road Dallas TX 75235
217 Park Place Apartments 9303 Woodfair Houston TX 77036
218 Parkway Plaza Shopping Center 3115 Parker Road & Independence Parkway Plano TX 75023
219 PoPolo Village 4444 FM 1960 Houston TX 77068
220 Portsmouth Industrial Park 124, 300 and 350 Heritage Ave. Portsmouth NH 03801
221 Radford Place Condominiums 3922 Evergreen Irving TX 75061
222 Regency Manor Apartments 2075 Regency Road Lexington KY 40503
223 Regency Park Apartments 4770 North 7th Street Phoenix AZ 85014
224 Ridge Landing Apartments 919 Corder Road Warner Robbins GA 31088
225 Ridglea West Shopping Center 6550 Camp Bowie Blvd. Fort Worth TX 76116
226 River Manor Apartments 200 Colorado Avenue Parachute CO 81635
227 Roadway Inn - Killeen 517 W. Veterans Memorial Blvd Killeen TX 76541
228 Rowesix Office Building 4224 Sixth Avenue Lacey WA 98509
229 Salem Manor 124 York Street Salem NJ 08079
230 Savannah Heights Apartments 2600 Arroyo Avenue Dallas TX 75219
231 Serrano Highlands Apartments 25421 Alta Loma Lake Forest CA 92630
232 Shamrock East Apartments 736 East Foster Avenue State College PA 16801
233 Sheraton Bangor International Airport 308 Godfrey Boulevard Bangor ME 04401
234 Sherwood 70 Associates 155 West 70th Street New York NY 10023
235 Snider Plaza 6801 Hillcrest & 6730 Snider Pl University Park TX 75205
236 South Oak & Taylor Oak Apts. 165 S. Oak Park & 415 South Taylor Oak Park IL 60302
237 Southgate Shopping Center Highway 79 and 21st Street Heath OH 43056
238 Spring Lake Apartments 8800 Hammerly Blvd Houston TX 77080
239 Spring Lake Lakehomes 2217 Hollister Houston TX 77080
240 Spring Village Apartments 601 Poplar Street Sharon Hill PA 19079
241 Sterling Pointe Apartments 6001 Oakland Hills Drive Fort Worth TX 76112
242 Summerfield Villas 8852 E. Bellevue Scottsdale AZ 85257
243 Summit South 300 Centerville Road Warwick RI 02866
244 Tanglewod Apartments 11185 Magnolia Avenue Riverside CA 92505
245 Vallejo Ramada Inn 1000 Admiral Callaghan Lane Vallejo CA 94591
246 Valley View Apartments (Chud) Vermont View Drive Colonie NY 12189
247 Valley View Apartments 7700-7736 Greenview Terrace Baltimore MD 21204
248 Villa Verde Apartments 4200 - 4260 West First Street Santa Ana CA 92704
249 Village at Collin Creek 601 - 641 Plano Parkway Plano TX 75075
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------ MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
199 3,390,166.45 24,170.33 7.670 116 356 11/01/2007 No HyperAm
200 4,689,498.95 34,625.51 7.630 118 322 01/01/2008 No Balloon
201 1,397,502.20 10,137.48 7.750 118 358 01/01/2008 No Balloon
202 2,685,775.46 20,964.40 8.070 55 295 10/01/2002 No Balloon
203 748,661.90 5,430.79 7.750 118 358 01/01/2008 No Balloon
204 4,187,008.02 30,783.56 7.875 116 356 11/01/2007 No Balloon
205 2,840,589.49 20,098.76 7.480 116 356 11/01/2007 No Balloon
206 1,930,968.03 16,055.17 8.830 115 295 10/01/2007 No Balloon
207 6,777,509.53 47,907.57 7.470 116 356 11/01/2007 No Balloon
208 8,423,864.19 64,005.19 8.330 114 354 09/01/2007 No HyperAm
209 2,690,878.99 24,490.04 9.010 113 233 08/01/2007 No HyperAm
210 3,443,820.57 24,908.87 7.720 118 358 01/01/2008 No Balloon
211 2,475,271.60 17,093.27 7.250 118 358 01/01/2008 No Balloon
212 3,748,825.26 26,700.89 7.340 117 321 12/01/2007 No Balloon
213 4,753,340.15 34,298.79 7.810 118 358 01/01/2008 No Balloon
214 1,796,625.40 12,562.18 7.375 118 358 01/01/2008 No HyperAm
215 7,727,996.04 55,629.10 7.770 116 356 11/01/2007 No Balloon
216 3,761,745.18 29,802.91 8.470 75 315 06/01/2004 No Balloon
217 2,909,404.44 19,990.91 7.200 118 358 01/01/2008 No Balloon
218 1,790,668.76 14,096.01 8.170 79 295 10/01/2004 No Balloon
219 3,267,850.83 23,191.51 7.630 117 357 12/01/2007 No Balloon
220 2,649,593.60 21,810.70 7.625 118 238 01/01/2008 No Balloon
221 938,207.78 6,478.90 7.250 118 358 01/01/2008 No Balloon
222 1,197,046.35 8,480.13 7.500 177 357 12/01/2012 No Balloon
223 8,783,753.30 62,118.96 7.490 118 358 01/01/2008 No Balloon
224 1,616,893.56 12,504.63 7.830 114 294 09/01/2007 No Balloon
225 1,555,030.09 12,019.67 7.980 117 297 12/01/2007 No Balloon
226 4,007,472.78 28,020.64 7.375 118 358 01/01/2008 No Balloon
227 1,081,105.78 9,499.29 8.500 238 238 01/01/2018 No Fully Amortizing
228 3,815,922.42 27,619.70 7.720 117 357 12/01/2007 No Balloon
229 1,990,346.17 15,026.33 7.580 116 296 11/01/2007 No Balloon
230 1,832,842.39 13,054.60 7.540 115 355 10/01/2007 No Balloon
231 12,465,157.89 89,392.22 7.030 118 298 01/01/2008 No Balloon
232 1,425,416.96 10,264.59 7.660 116 356 11/01/2007 No Balloon
233 3,089,850.80 26,550.40 8.320 238 238 01/01/2018 Yes Fully Amortizing
234 2,193,155.40 16,070.33 7.840 116 356 11/01/2007 No Balloon
235 1,195,770.66 9,152.62 7.750 117 297 12/01/2007 No Balloon
236 1,896,396.97 13,148.18 7.290 118 358 01/01/2008 No Balloon
237 10,958,660.08 79,508.79 7.730 115 355 10/01/2007 No Balloon
238 3,371,455.91 23,509.65 7.340 117 357 12/01/2007 No Balloon
239 2,334,172.92 16,422.16 7.430 117 357 12/01/2007 No Balloon
240 2,491,116.42 17,962.16 7.780 115 355 10/01/2007 No Balloon
241 2,794,690.26 19,376.27 7.290 118 358 01/01/2008 No Balloon
242 3,810,088.89 26,145.39 7.180 117 357 12/01/2007 No Balloon
243 3,241,581.18 24,546.81 7.640 142 298 01/01/2010 No Balloon
244 1,397,285.01 9,528.85 7.125 118 358 01/01/2008 No Balloon
245 2,146,767.41 19,538.01 9.010 113 233 08/01/2007 No HyperAm
246 10,247,492.97 73,363.86 7.690 113 353 08/01/2007 No Balloon
247 7,660,004.07 58,010.00 8.280 112 352 07/01/2007 No Balloon
248 8,039,797.98 56,537.17 7.520 55 355 10/01/2002 No Balloon
249 7,890,268.98 55,814.35 7.500 119 359 02/01/2008 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
199 0.090 MLMC GCAM Actual/360
200 0.095 MLMC First Union Actual/360
201 0.125 MLMC MLCC Yes Actual/360
202 0.095 MLMC First Union 30/360
203 0.125 MLMC MLCC Yes Actual/360
204 0.095 MLMC First Union Actual/360
205 0.095 MLMC L.J. Melody Actual/360
206 0.095 MLMC First Union 30/360
207 0.095 MLMC First Union Actual/360
208 0.095 MLMC First Union 30/360
209 0.095 MLMC First Union 30/360
210 0.095 MLMC L.J. Melody Actual/360
211 0.095 MLMC First Union Actual/360
212 0.095 MLMC L.J. Melody 30/360
213 0.095 MLMC First Union 30/360
214 0.095 MLMC First Union Actual/360
215 0.095 MLMC First Union 30/360
216 0.095 MLMC Robert C. Wilson 30/360 Cntrl #'s 179, 191
217 0.095 MLMC L.J. Melody Actual/360
218 0.095 MLMC First Union 30/360
219 0.095 MLMC L.J. Melody 30/360
220 0.125 MLMC MLCC Actual/360
221 0.095 MLMC First Union Actual/360
222 0.095 MLMC First Union Actual/360
223 0.095 MLMC First Union Actual/360
224 0.095 MLMC First Union Actual/360
225 0.095 MLMC First Union 30/360
226 0.095 MLMC First Union Actual/360
227 0.095 MLMC First Union Actual/360
228 0.095 MLMC First Union Actual/360
229 0.095 MLMC First Union Actual/360
230 0.095 MLMC First Union Actual/360
231 0.095 MLMC First Union Actual/360
232 0.125 MLMC MLCC Actual/360
233 0.125 MLMC MLCC 30/360
234 0.095 MLMC First Union Actual/360
235 0.095 MLMC L.J. Melody Actual/360
236 0.095 MLMC First Union Actual/360
237 0.095 MLMC First Union Yes Actual/360
238 0.095 MLMC First Union Actual/360
239 0.095 MLMC First Union Actual/360
240 0.095 MLMC First Union 30/360
241 0.095 MLMC First Union Actual/360
242 0.125 MLMC MLCC Actual/360
243 0.125 MLMC MLCC Actual/360
244 0.095 MLMC First Union Actual/360
245 0.095 MLMC First Union 30/360
246 0.095 MLMC First Union 30/360
247 0.095 MLMC First Union 30/360
248 0.095 MLMC Robert C. Wilson 30/360
249 0.095 MLMC L.J. Melody Actual/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
250 Village Green Apartments III/IV W180 N8526 Town Hall Rd Menomonee WI 53051
251 Village Shopping Center 2700 Anderson Lane Austin TX 78757
252 Villas of Josey Ranch 2050 Keller Springs Rd. Carrollton TX 75006
253 Virginia Village Apartments 4904 Fran Place Alexandria VA 22312
254 Westbury Square Office/Retail Center 2301 West Park Row Arlington TX 76013
255 Westchester Manor 107 Westchester Circle Athens GA 30606
256 Wickes Headquarters 706 N. Deerpath Road Vernon Hills IL 60061
257 Williamstown Apartments 3242 Norwalk Avenue Dallas TX 75220
258 Willowick & Willow Creek Apts 430-502 Southwest Parkway College Station TX 77840
259 Windfern Meadows Apartments 12919 Windfern Houston TX 77064
260 Windjammer Cove Apartments 79 Shaw Street Braintree MA 02184
261 Woodridge Apartments 2699 Ridge Road East Irondequoit NY 14622
300 Spring Branch Estates Apartments 7901 Ameilia Road Houston TX 77055
301 Holiday Inn Cortland 2 River Street Cortland NY 13045
302 Stoney Fields Estates 1059 Ocean Heights Avenue Egg Harbor Township NJ 08234
303 Waters Edge Apartments 394 Ocean Avenue Revere MA 02151
304 Northgate Distribution Center 1000 - 1200 Williams Drive Marietta GA 30066
305 Ebbets Field Apartments 1672-1726 Bedford Avenue Brooklyn NY 11225
306 The Grand Hotel 1045 Beach Drive Cape May NJ 08204
307 Windrush Apartments 4322 Kostoryz Road Corpus Christi TX 78415
308 Woodbury Place Apartments 802 Barry Street Corpus Christi TX 78411
309 Promenade Shopping Center -
Palm Beach Gardens 9810 - 9930 North Alternate A-1A Palm Beach Gardens FL 33408
310 Ramada Inn Foothills 6944 East Tanque Verde Road Tucson AZ 85715
311 Days Inn Coliseum 2420 West Thomas Road Phoenix AZ 85015
312 Ramada Inn - Bordentown 1083 Route 206 Bordentown NJ 08505
313 Comfort Inn - Maingate 7571 W. Irlo Bronson Memorial Highway Kissimmee FL 34747
314 Lido Plaza Shopping Center 4343 North Rancho Drive Las Vegas NV 89130
315 Southwood Square Shopping Center 2826-2850 South Main High Point NC 27263
316 Rockledge Apartments 2505 Verde Drive Colorado Springs CO 80910
317 Carmel Apartments 2010 Carmel Drive Colorado Springs CO 80910
318 Napa Town Center 1290 Napa Town Center Napa CA 95449
319 Days Inn Busch Gardens 2901 E. Busch Blvd Tampa FL 33612
320 Mill Village 365 Boston Post Road (Route 20) Sudbury MA 01776
321 Cedar Professional Building 204 Worcester Road Wellesley MA 02181
322 South Water Street 5 South Water Street Nantucket MA 02554
323 Wellesley Marketplace 239-251 Washington Street Wellesley MA 02181
324 The Wealshire 150 Jamestown Lane Lincolnshire IL 60069
325 Hampton Inn and Suites 6101 Sand Lake Road Orlando FL 32819
326 Hampton Inn 1975 N. Druid Hills Road Atlanta GA 30329
327 Days Inn Hotel 121 Days Inn Drive Easley SC 29640
328 The Majestic Hotel 1500 Sutter Street San Francisco CA 94109
329 Fortunoff 70 Charles Lindbergh Boulevard Uniondale NY 11553
330 Days Inn - Fort Lauderdale 1595 West Oakland Park Blvd. Fort Lauderdale FL 33311
331 Timmons Place & Timmons Square 3637 & 3701 West Alabama Houston TX 77027
332 Shops at Fairlane Meadows 15901 - 16301 Ford Road Dearborn MI 48126
333 Palm Glen Shopping Center 3501-3627 West Glendale Avenue Phoenix AZ 85051
334 Fairway Shopping Center 5859 West Indian School Road Phoenix AZ 85031
335 University Park Plaza 3350 South University Drive Davie FL 33328
336 Timbers North Apartments 2201 North 14th Street Ponca City OK 74602
337 Corporate Center at Beaumeade 44633 & 44645 Guilford Drive,
21641 Beaumede Circle Ashburn VA 22011
338 The Village Mall Shopping Center 4907 West 10th Street Great Bend KS 67530
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ----------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
250 1,796,568.11 12,406.40 7.250 178 358 01/01/2013 No Balloon
251 5,136,222.35 37,976.08 7.370 118 298 01/01/2008 No Balloon
252 6,845,755.37 49,574.73 7.810 113 353 08/01/2007 No Balloon
253 9,983,264.80 65,926.91 6.910 118 358 01/01/2008 No Balloon
254 2,241,483.86 17,335.37 8.120 116 320 11/01/2007 No Balloon
255 2,392,101.63 16,958.73 7.500 116 356 11/01/2007 No Balloon
256 5,307,965.38 43,332.31 8.570 112 292 07/01/2007 No Balloon
257 1,442,995.74 10,895.39 7.580 116 296 11/01/2007 No Balloon
258 5,090,372.50 35,437.79 7.330 118 358 01/01/2008 No Balloon
259 4,240,238.56 29,353.69 7.375 117 357 12/01/2007 No Balloon
260 2,887,413.45 22,114.38 7.860 296 296 11/01/2022 No Fully Amortizing
261 6,674,630.06 48,838.68 7.240 177 297 12/01/2012 No Balloon
300 2,048,228.94 16,900.70 8.710 75 292 06/05/2004 No Balloon
301 2,646,054.15 24,261.00 9.740 111 267 06/01/2007 No Balloon
302 1,599,659.70 13,610.43 9.090 112 292 07/01/2007 No Balloon
303 4,664,962.19 37,277.27 8.320 112 292 07/01/2007 No Balloon
304 4,678,099.18 38,947.22 8.820 112 292 07/01/2007 No Balloon
305 17,638,089.49 144,245.97 8.610 113 293 08/01/2007 No Balloon
306 8,440,020.39 75,997.49 9.345 114 258 09/01/2007 No Balloon
307 3,719,057.45 26,218.04 7.540 114 354 09/01/2007 No Balloon
308 7,438,114.91 52,436.08 7.540 114 354 09/01/2007 No Balloon
309 15,240,668.96 112,052.73 7.980 114 354 09/01/2007 No Balloon
310 3,777,705.12 31,692.04 8.620 115 271 10/01/2007 No Balloon
311 4,672,424.76 39,198.05 8.620 115 271 10/01/2007 No Balloon
312 3,594,409.38 29,934.45 8.530 115 271 10/01/2007 No Balloon
313 7,158,865.85 60,907.05 8.800 115 271 10/01/2007 No Balloon
314 6,983,194.97 53,010.96 7.780 118 298 01/01/2008 No Balloon
315 3,579,158.32 28,697.64 8.380 114 294 09/01/2007 No Balloon
316 5,882,520.95 41,455.85 7.550 116 356 11/01/2007 No Balloon
317 1,495,556.19 10,539.62 7.550 116 356 11/01/2007 No Balloon
318 6,470,703.66 48,564.17 7.625 116 296 11/01/2007 No Balloon
319 3,930,804.82 32,267.27 8.360 116 272 11/01/2007 No Balloon
320 2,688,338.01 20,642.67 7.890 116 296 11/01/2007 No Balloon
321 1,458,569.55 11,104.07 7.790 116 296 11/01/2007 No Balloon
322 2,588,587.61 19,706.88 7.790 116 296 11/01/2007 No Balloon
323 1,792,099.13 13,643.22 7.790 116 296 11/01/2007 No Balloon
324 15,933,738.61 125,084.67 8.150 116 296 11/01/2007 No Balloon
325 15,946,750.90 120,327.86 7.700 117 297 12/01/2007 No Balloon
326 6,727,535.52 50,763.32 7.700 117 297 12/01/2007 No Balloon
327 2,541,513.44 19,177.25 7.700 117 297 12/01/2007 No Balloon
328 5,684,840.47 46,376.33 8.310 82 274 01/01/2005 No Balloon
329 5,902,464.31 73,655.39 8.270 105 118 12/01/2006 Yes Balloon
330 2,736,636.29 22,464.55 8.360 116 272 11/01/2007 No Balloon
331 3,188,784.11 26,309.85 7.770 238 238 01/01/2018 No Fully Amortizing
332 12,769,942.59 96,184.22 8.180 107 348 02/01/2007 No Balloon
333 9,483,916.12 66,490.44 7.510 118 358 01/01/2008 No Balloon
334 947,804.01 7,370.05 8.060 118 298 01/01/2008 No Balloon
335 9,985,952.20 71,917.84 7.790 118 358 01/01/2008 No Balloon
336 548,739.73 4,290.63 8.125 118 298 01/01/2008 No Balloon
337 6,982,306.22 51,274.92 7.400 118 298 01/01/2008 No Balloon
338 2,145,621.25 15,926.95 7.800 118 322 01/01/2008 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
250 0.095 MLMC First Union Actual/360
251 0.095 MLMC First Union Actual/360
252 0.095 MLMC First Union 30/360
253 0.095 MLMC L.J. Melody 30/360
254 0.095 MLMC Robert C. Wilson Actual/360
255 0.095 MLMC First Union Actual/360
256 0.095 MLMC First Union 30/360
257 0.095 MLMC First Union Actual/360
258 0.095 MLMC L.J. Melody Actual/360
259 0.095 MLMC First Union 30/360
260 0.255 MLMC Arbor Actual/360
261 0.125 MLMC MLCC Actual/360
300 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
301 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
302 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
303 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
304 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
305 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
306 0.095 Daiwa Finance Corp. First Union Yes 30/360
307 0.095 Daiwa Finance Corp. First Union Yes Actual/360
308 0.095 Daiwa Finance Corp. First Union Yes Actual/360
309 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
310 0.095 Daiwa Finance Corp. First Union Yes 30/360
311 0.095 Daiwa Finance Corp. First Union Yes 30/360
312 0.095 Daiwa Finance Corp. First Union Yes Actual/360
313 0.095 Daiwa Finance Corp. First Union Yes 30/360
314 0.160 Daiwa Real Estate Finance Corp. Collateral Mortgage Yes Actual/360
315 0.160 Daiwa Finance Corp. Collateral Mortgage Actual/360
316 0.095 Daiwa Finance Corp. First Union Yes Actual/360
317 0.095 Daiwa Finance Corp. First Union Yes Actual/360
318 0.095 Daiwa Finance Corp. First Union Yes Actual/360
319 0.095 Daiwa Finance Corp. First Union 30/360
320 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
321 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
322 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
323 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
324 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
325 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
326 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
327 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
328 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
329 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
330 0.095 Daiwa Finance Corp. First Union 30/360
331 0.095 Daiwa Finance Corp. First Union Yes 30/360
332 0.160 Daiwa Finance Corp. Continental Wingate 30/360
333 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
334 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
335 0.095 Daiwa Finance Corp. First Union 30/360
336 0.095 Daiwa Finance Corp. First Union Actual/360
337 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
338 0.095 Daiwa Finance Corp. First Union Yes Actual/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
339 South Plaza Shopping Center 5500 Nolansville Road Nashville TN 37211
340 First Hill Medical Building 515 & 525 Minor Avenue Seattle WA 98104
341 Promenade Shopping Center -
Highlands Ranch, Colorado 2660 - 2690 East County Line Road Highlands Ranch CO 80126
535 Atrium Apartments 3401 Northwest 3rd Avenue Pompano Beach FL 33064
536 Fort Williams Square Shopping Center 1351-1389 Fort Williams Street Sylacuaga AL 35150
342 Plaza Terrace Apartments 1307 thru 1701 Plaza, 35th,
and Murdock Road Charlotte NC 28205
343 136 West 71st Street 136 West 71st Street New York NY 10023
344 Pines Apartments 2125 Stardust Court Alamogordo NM 88310
345 Golden Arms Apartments 1400 Utah Street Golden CO 80401
346 Le Chateau Apartments 3144 Chateau Boulevard East Point GA 30344
347 Pacific Cove Apartments 3619 East Monterosa Street Phoenix AZ 85018
348 Albany Avenue 601 Albany Avenue Brooklyn NY 11203
349 Broadway Inn Apartments 8477 East Broadway Boulevard Tucson AZ 85710
350 Shawnee Garden Apartments 6013 King Street Shawnee KS 66203
351 Tierra Alegre Apartments 3355 East Fort Lowell Road Tucson AZ 85716
352 2240 University Avenue 2240 University Avenue Bronx NY 10453
353 The Tropicaire Apartments 890 NW 45th Avenue Miami FL 33126
354 Woodland View Apartments 1195 Woodland Avenue Atlanta GA 30329
355 Coronado Heights 3066 North Balboa Avenue Tucson AZ 85705
356 Sheridan Apartments 78 Sheridan Drive Atlanta GA 30305
357 Vista Verde Apartments 3620 Verde Drive Colorado Springs CO 80910
358 Cedar Point Apartments 4411 Cedar Springs Road Dallas TX 75219
359 Hampstead Oaks Apartments 200 Hampstead Avenue Savannah GA 31405
360 Cordova Apartments 900 West Gate Drive Bossier LA 71112
540 New Haven, Westchester, 4021 & 4217 Hessmer Ave,
Willowdale Apartments 3212 Roberta Street Metairie LA 70002
361 Deerwood Apartments 2220 NW 55th Boulevard Gainesville FL 32606
362 Shadyedge, Tudor Court Apartments 810 - 812 South Negley Avenue, Pittsburgh,
131 Edgewood Avenue Edgewood Borough PA 15232 & 15218
365 Crotona Avenue 2314 - 2318 Crotona Avenue Bronx NY 10458
366 1020 & 1030 Boynton Avenue 1020 & 1030 Boynton Avenue Bronx NY 10472
367 Amberlake Apartments 4901 Bartow Road Acworth GA 30101
368 Pine Valley Estates Apartments 415 West Redd Road El Paso TX 79932
369 West 141st Street Apartments 111-115 West 141st Street New York NY 10030
370 West 24th Street 1300 - 1302 West 24th Street Austin TX 78705
371 Chestnut Hill Apartments 246 Chestnut Hill Road Marietta GA 30064
372 Courtyard Apartments 2300 North "A" Street Midland TX 79705
373 Century Heights Apartments 1305 West Woodrow Road Slaton TX 79364
374 Western Crest Apartments 3901 Avenue O Snyder TX 79549
375 Terwood Court Apartments 329 - 331 West Washington Westchester PA 19380
376 Winding Way Apartments 13266 Emily Road Dallas TX 75240
377 Morningside Bay Apartments 5995 Biscayne Boulevard Miami FL 33137
378 Del Toro Apartments 909 South Priest Drive Tempe AZ 85008
379 Eucalyptus Apartments 3055 N. Tyndall Tucson AZ 85719
380 Bonnie Lynn Apartments 2020 West Hayward Avenue Phoenix AZ 85021
381 Regal Oaks Apartments 115 Woodland Avenue Atlanta GA 30329
382 Papago Palms West 1835 North 51st Street Phoenix AZ 85008
383 Malibu Apartments 3655 North First Avenue Tucson AZ 85719
384 Darling Street Apartments 3,5 & 11 Darling Street Roxbury MA 02120
385 2025-2027 Walnut Street 2025 - 2027 Walnut Street Philadelphia PA 19103
386 Burlington Townhomes 102 Denise Drive Burlington NC 27215
387 Woodglen Apartments 818 Pinemont Houston TX 77018
388 Abbey Arms Apartments 2010 Abbey Road Norfolk VA 23518
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ----------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
339 12,478,701.74 87,145.18 7.470 118 358 01/01/2008 No Balloon
340 15,838,528.23 112,185.31 7.625 119 359 02/01/2008 No Balloon
341 7,687,935.32 56,502.24 7.420 119 299 02/01/2008 No Balloon
535 788,570.03 5,412.58 7.300 119 359 02/01/2008 No Balloon
536 2,246,537.26 16,832.74 7.640 119 299 02/01/2008 No Balloon
342 1,154,417.30 10,066.75 8.500 237 237 12/01/2017 No Fully Amortizing
343 562,612.58 4,519.26 8.875 69 344 12/01/2003 No Balloon
344 1,039,650.36 8,624.51 9.125 88 328 07/01/2005 No Balloon
345 1,332,586.74 10,820.77 8.875 88 328 07/01/2005 No Balloon
346 464,136.63 4,369.34 8.875 209 209 08/01/2015 No Fully Amortizing
347 510,017.23 4,230.89 9.125 88 328 07/01/2005 No Balloon
348 1,398,810.19 13,822.54 9.625 209 209 08/01/2015 No Fully Amortizing
349 573,070.82 5,154.81 9.500 89 269 08/01/2005 No Balloon
350 587,890.70 5,085.53 9.000 54 270 09/01/2002 No Balloon
351 958,012.64 8,021.09 9.250 90 330 09/01/2005 No Balloon
352 343,680.48 3,444.32 9.875 210 210 09/01/2015 No Fully Amortizing
353 988,589.78 9,132.44 10.000 64 280 07/01/2003 No Balloon
354 870,368.93 8,242.80 9.250 219 219 06/01/2016 No Fully Amortizing
355 638,948.29 5,792.39 9.750 100 280 07/01/2006 No Balloon
356 609,243.85 5,470.89 9.625 40 280 07/01/2001 No Balloon
357 492,118.42 4,499.52 9.875 101 281 08/01/2006 No Balloon
358 1,180,697.18 10,693.65 9.750 101 281 08/01/2006 No Balloon
359 1,470,406.70 12,802.91 9.250 66 282 09/01/2003 No Balloon
360 1,167,034.41 11,087.80 9.375 222 222 09/01/2016 No Fully Amortizing
540 1,263,318.57 10,798.49 8.875 92 272 11/01/2005 No Balloon
361 860,400.04 6,961.89 8.875 93 333 12/01/2005 No Balloon
362 609,599.39 5,100.59 9.250 91 331 10/01/2005 No Balloon
365 707,234.19 7,019.03 9.750 211 211 10/01/2015 No Fully Amortizing
366 1,433,582.89 14,227.76 9.750 211 211 10/01/2015 No Fully Amortizing
367 1,259,159.61 10,867.59 9.000 92 272 11/01/2005 No Balloon
368 1,285,304.72 13,786.35 8.500 153 153 12/01/2010 No Fully Amortizing
369 382,719.63 3,761.24 9.625 212 212 11/01/2015 No Fully Amortizing
370 764,746.51 7,069.69 8.750 214 214 01/01/2016 No Fully Amortizing
371 525,410.85 4,816.63 8.625 214 214 01/01/2016 No Fully Amortizing
372 1,101,562.42 9,537.44 9.125 98 278 05/01/2006 No Balloon
373 482,165.90 4,498.63 9.000 218 218 05/01/2016 No Fully Amortizing
374 603,034.53 5,673.63 9.125 218 218 05/01/2016 No Fully Amortizing
375 1,247,933.31 11,860.48 9.250 217 217 04/01/2016 No Fully Amortizing
376 482,686.29 4,579.33 9.250 218 218 05/01/2016 No Fully Amortizing
377 489,067.36 4,238.86 9.125 97 277 04/01/2006 No Balloon
378 259,587.40 2,269.41 9.250 62 278 05/01/2003 No Balloon
379 389,899.59 3,220.91 8.500 96 276 03/01/2006 No Balloon
380 537,973.99 4,662.75 9.125 97 277 04/01/2006 No Balloon
381 386,353.47 3,695.93 9.375 218 218 05/01/2016 No Fully Amortizing
382 622,201.99 5,182.86 9.250 62 338 05/01/2003 No Balloon
383 691,748.63 5,934.41 9.125 107 286 02/01/2007 No Balloon
384 1,268,746.20 10,530.25 9.250 104 344 11/01/2006 No Balloon
385 477,963.50 4,153.45 9.250 104 284 11/01/2006 No Balloon
386 347,193.95 3,106.05 9.625 104 284 11/01/2006 No Balloon
387 753,623.67 6,884.27 9.875 102 282 09/01/2006 No Balloon
388 488,427.81 4,281.87 9.375 105 285 12/01/2006 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
339 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
340 0.095 Daiwa Finance Corp. First Union Yes 30/360
341 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
535 0.095 Daiwa Finance Corp. First Union Actual/360
536 0.095 Daiwa Finance Corp. First Union Yes Actual/360
342 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
343 0.095 Daiwa Finance Corp. First Union 30/360
344 0.095 Daiwa Finance Corp. First Union 30/360
345 0.095 Daiwa Finance Corp. First Union 30/360
346 0.095 Daiwa Finance Corp. First Union 30/360
347 0.095 Daiwa Finance Corp. First Union 30/360
348 0.095 Daiwa Finance Corp. First Union 30/360
349 0.095 Daiwa Finance Corp. First Union 30/360
350 0.095 Daiwa Finance Corp. First Union 30/360
351 0.095 Daiwa Finance Corp. First Union 30/360
352 0.095 Daiwa Finance Corp. First Union 30/360
353 0.095 Daiwa Finance Corp. First Union 30/360
354 0.095 Daiwa Finance Corp. First Union 30/360
355 0.095 Daiwa Finance Corp. First Union 30/360
356 0.095 Daiwa Finance Corp. First Union 30/360
357 0.095 Daiwa Finance Corp. First Union 30/360
358 0.095 Daiwa Finance Corp. First Union 30/360
359 0.095 Daiwa Finance Corp. First Union 30/360
360 0.095 Daiwa Finance Corp. First Union 30/360
540 0.095 Daiwa Finance Corp. First Union 30/360
361 0.095 Daiwa Finance Corp. First Union 30/360
362 0.095 Daiwa Finance Corp. First Union 30/360
365 0.095 Daiwa Finance Corp. First Union 30/360
366 0.095 Daiwa Finance Corp. First Union 30/360
367 0.095 Daiwa Finance Corp. First Union 30/360
368 0.095 Daiwa Finance Corp. First Union 30/360
369 0.095 Daiwa Finance Corp. First Union 30/360
370 0.095 Daiwa Finance Corp. First Union 30/360
371 0.095 Daiwa Finance Corp. First Union 30/360
372 0.095 Daiwa Finance Corp. First Union 30/360
373 0.095 Daiwa Finance Corp. First Union 30/360
374 0.095 Daiwa Finance Corp. First Union 30/360
375 0.095 Daiwa Finance Corp. First Union 30/360
376 0.095 Daiwa Finance Corp. First Union 30/360
377 0.095 Daiwa Finance Corp. First Union 30/360
378 0.095 Daiwa Finance Corp. First Union 30/360
379 0.095 Daiwa Finance Corp. First Union 30/360
380 0.095 Daiwa Finance Corp. First Union 30/360
381 0.095 Daiwa Finance Corp. First Union 30/360
382 0.095 Daiwa Finance Corp. First Union 30/360
383 0.095 Daiwa Finance Corp. First Union Actual/360
384 0.095 Daiwa Finance Corp. First Union 30/360
385 0.095 Daiwa Finance Corp. First Union 30/360
386 0.095 Daiwa Finance Corp. First Union 30/360
387 0.095 Daiwa Finance Corp. First Union 30/360
388 0.095 Daiwa Finance Corp. First Union 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
541 Cameron Court Apartments 1675 Smyrna Roswell Road Smyrna GA 30136
389 Newport Central Townhomes 5506 Grover Avenue Austin TX 78756
390 Village Phoenix Apartments 2620 North 40th Street Phoenix AZ 85008
391 Woodside Court Apartments 103 - 105 South Narberth Avenue Narberth PA 19072
392 Concord Green Apartments 7001 Northline Drive Houston TX 77076
393 Bellerive Apartments 214 East Armour Boulevard Kansas City MO 64111
394 Prince Plaza Apartments 120 West Prince Road Tucson AZ 85705
395 Silver Club Apartments 5170 Silver Creek Drive Houston TX 77017
396 Beechnut Palms Apartments 8910 Beechnut Street Houston TX 77072
397 Foresight Village Apartments - Phase I 610 & 616 25 1/2 Road Grand Junction CO 81505
542 Pleasonton Valley Apartments 3735 Pleasanton Road San Antonio TX 78221
398 Canterbury Apartments 689 - 695 Farmington Avenue West Hartford CT 06107
399 Altos Park Apartments 1119 - 1131 Mary Ellen, NE Albuquerque NM 87112
400 Amberwood Apartments 800 Hamsted Street Fort Worth TX 76115
401 Pinon Terrace Apartments 8409 Comanche Road Albuquerque NM 87111
402 Second Street Apartments 80 - 86 Second Street Elizabeth NJ 07206
403 Steele Street Apartments 1421 Steele Street Denver CO 80218
404 Williams Street Apartments 1436 Williams Street Denver CO 80206
405 Beverly Rossmore Apartments 304 North Rossmore Avenue Los Angeles CA 90004
406 Chestnut Mansion 114 West Chestnut Street Kingston NY 12401
407 Riverside Village 1608 8th Street NE Auburn WA 98022
408 Woodlawn Apartments 3762 UpRiver Road Corpus Christi TX 78408
409 96 Wadsworth Terrace 96 Wadsworth Terrace New York NY 10005
410 Vanowen Street Apartments 16215 - 16221 Vanowen Street Van Nuys CA 94406
411 Saticoy Street Apartments 20445 Saticoy Street Canoga Park CA 91306
412 Bombay Apartments 11922 Burbank Boulevard North Hollywood CA 91607
413 Albion Manor Apartments 1500 - 10 South Albion Street Denver CO 80220
414 1479 Macombs Road 1479 Macombs Road Bronx NY 10452
415 The Seville Apartments 1148 William Street Bridgeport CT 06608
416 Denton Court Apartments 4735 Denton Street Dallas TX 75219
417 Mulberry Place Apartments 1661 Mulberry Street Charleston SC 29407
418 Windsor Apartments 4421 Windsor Drive Fort Smith AR 72904
419 Willow Pointe Apartments 3224 & 3212 Massard and 3207 & 3211 Enid Fort Smith AR 72903
420 Southtown Apartments 5039 South 31st Fort Smith AR 72903
421 470 Beacon Street 470 Beacon Street Boston MA 02117
422 Meadow Lea Apartments 8217 Fulton Street Houston TX 77022
423 Princess Apartments 1177 South Norton Ave. Los Angeles CA 90019
424 Villa Martel Apartments 3602 E. Monte Vista Road Phoenix AZ 85008
425 Stardust Apartments 5727 Gaston Avenue Dallas TX 75214
426 1808 Beverly Road 1808 Beverly Road Brooklyn NY 11226
427 Lake Avenue Apartments 144 Lake Avenue Manchester NH 03104
428 Shea Terrace Apartments 222-224 Sandpiper Drive Portsmouth VA 23704
429 Sunset Gardens 801 Las Lomas Avenue Pacific Palisades CA 90272
430 Country Creek Village Apartments 3783 Legendary Lane Dallas TX 75224
431 Pine Hill Apartments 367 Fletchwood Road Elkton MD 21921
432 Stoneridge Apartments 1500 South Lamar Boulevard Austin TX 78704
433 Highland Villas Apartments 210 North Avenue 55 Los Angeles CA 90042
434 Mount Vernon Manor Apartments 9225 Long Point Houston TX 77055
435 Lanier Place 1725 Lanier Place, NW Washington DC 20009
436 Tamarack Shadows Apartments 3101 North 36th Street Phoenix AZ 85018
437 Royal Poinciana 380 North Royal Poinciana Boulevard Miami Springs FL 33166
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS -------------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
541 803,411.94 7,049.94 9.375 104 284 11/01/2006 No Balloon
389 887,713.16 7,399.29 8.750 106 286 01/01/2007 No Balloon
390 620,635.69 5,504.28 9.500 103 283 10/01/2006 No Balloon
391 493,309.36 4,153.27 8.875 106 286 01/01/2007 No Balloon
392 1,233,273.56 10,383.16 8.875 286 286 01/01/2022 No Fully Amortizing
393 1,193,808.80 10,050.90 8.875 106 286 01/01/2007 No Balloon
394 399,898.64 3,468.35 9.250 106 286 01/01/2007 No Balloon
395 493,442.59 4,195.98 9.000 106 286 01/01/2007 No Balloon
396 986,885.16 8,391.96 9.000 106 286 01/01/2007 No Balloon
397 1,680,866.82 14,324.59 9.050 107 287 02/01/2007 No Balloon
542 642,945.64 5,566.48 9.250 107 287 02/01/2007 No Balloon
398 560,954.48 4,798.39 9.125 109 289 04/01/2007 No Balloon
399 653,264.81 5,806.20 9.625 110 290 05/01/2007 No Balloon
400 809,134.98 7,191.57 9.625 110 290 05/01/2007 No Balloon
401 1,298,379.73 11,446.14 9.520 110 290 05/01/2007 No Balloon
402 760,839.14 6,696.88 9.500 110 290 05/01/2007 No Balloon
403 213,908.38 1,882.82 9.500 110 290 05/01/2007 No Balloon
404 248,649.96 2,188.61 9.500 110 290 05/01/2007 No Balloon
405 991,827.29 8,391.96 9.000 110 290 05/01/2007 No Balloon
406 1,210,517.21 10,447.86 9.250 110 290 05/01/2007 No Balloon
407 714,990.33 6,228.17 9.375 111 291 06/01/2007 No Balloon
408 595,825.28 5,190.14 9.375 111 291 06/01/2007 No Balloon
409 843,938.67 7,279.25 9.250 111 291 06/01/2007 No Balloon
410 575,964.39 5,017.14 9.375 111 291 06/01/2007 No Balloon
411 1,097,311.53 9,558.51 9.375 111 291 06/01/2007 No Balloon
412 705,059.88 6,141.67 9.375 111 291 06/01/2007 No Balloon
413 843,938.67 7,279.25 9.250 111 291 06/01/2007 No Balloon
414 1,490,901.57 12,975.35 9.375 112 292 07/01/2007 No Balloon
415 484,467.51 4,174.86 9.250 112 292 07/01/2007 No Balloon
416 1,068,143.64 9,113.56 9.125 112 292 07/01/2007 No Balloon
417 715,056.61 5,919.43 8.750 112 292 07/01/2007 No Balloon
418 422,567.42 3,603.03 9.125 113 293 08/01/2007 No Balloon
419 661,193.68 5,637.69 9.125 113 293 08/01/2007 No Balloon
420 323,139.78 2,755.26 9.125 113 293 08/01/2007 No Balloon
421 715,407.88 6,103.96 9.125 112 292 07/01/2007 No Balloon
422 596,267.70 5,138.29 9.250 112 292 07/01/2007 No Balloon
423 734,688.75 6,273.52 9.125 112 292 07/01/2007 No Balloon
424 715,407.88 6,103.96 9.125 112 292 07/01/2007 No Balloon
425 377,576.34 3,221.54 9.125 112 292 07/01/2007 No Balloon
426 377,772.71 3,188.95 9.000 113 293 08/01/2007 No Balloon
427 323,003.49 2,671.97 8.750 113 293 08/01/2007 No Balloon
428 187,654.93 1,643.54 9.375 106 286 01/01/2007 No Balloon
429 500,594.44 4,629.68 9.125 228 228 03/01/2017 No Fully Amortizing
430 889,514.51 7,707.44 9.250 107 287 02/01/2007 No Balloon
431 1,583,206.12 13,840.37 9.375 48 288 03/01/2002 No Balloon
432 2,370,290.72 19,935.66 8.875 107 287 02/01/2007 No Balloon
433 1,207,470.97 9,901.91 9.125 70 346 01/01/2004 No Balloon
434 726,800.16 6,168.09 9.000 108 288 03/01/2007 No Balloon
435 885,530.29 8,389.18 9.500 229 229 04/01/2017 No Fully Amortizing
436 593,306.18 5,035.18 9.000 108 288 03/01/2007 No Balloon
437 457,831.44 4,943.37 9.625 170 170 05/01/2012 No Fully Amortizing
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
541 0.095 Daiwa Finance Corp. First Union 30/360
389 0.095 Daiwa Finance Corp. First Union 30/360
390 0.095 Daiwa Finance Corp. First Union 30/360
391 0.095 Daiwa Finance Corp. First Union 30/360
392 0.095 Daiwa Finance Corp. First Union 30/360
393 0.095 Daiwa Finance Corp. First Union 30/360
394 0.095 Daiwa Finance Corp. First Union 30/360
395 0.095 Daiwa Finance Corp. First Union 30/360 Cntrl # 396
396 0.095 Daiwa Finance Corp. First Union 30/360 Cntrl # 395
397 0.095 Daiwa Finance Corp. First Union Actual/360
542 0.095 Daiwa Finance Corp. First Union Actual/360
398 0.095 Daiwa Finance Corp. First Union Actual/360
399 0.095 Daiwa Finance Corp. First Union Actual/360
400 0.095 Daiwa Finance Corp. First Union Actual/360
401 0.095 Daiwa Finance Corp. First Union Actual/360
402 0.095 Daiwa Finance Corp. First Union Actual/360
403 0.095 Daiwa Finance Corp. First Union Actual/360
404 0.095 Daiwa Finance Corp. First Union Actual/360
405 0.095 Daiwa Finance Corp. First Union Actual/360
406 0.095 Daiwa Finance Corp. First Union Actual/360
407 0.095 Daiwa Finance Corp. First Union Actual/360
408 0.095 Daiwa Finance Corp. First Union Actual/360
409 0.095 Daiwa Finance Corp. First Union Actual/360
410 0.095 Daiwa Finance Corp. First Union Actual/360
411 0.095 Daiwa Finance Corp. First Union Actual/360
412 0.095 Daiwa Finance Corp. First Union Actual/360
413 0.095 Daiwa Finance Corp. First Union Actual/360
414 0.095 Daiwa Finance Corp. First Union Actual/360
415 0.095 Daiwa Finance Corp. First Union Actual/360
416 0.095 Daiwa Finance Corp. First Union Actual/360
417 0.095 Daiwa Finance Corp. First Union Actual/360
418 0.095 Daiwa Finance Corp. First Union Actual/360 Cntrl #'s 419, 420
419 0.095 Daiwa Finance Corp. First Union Actual/360 Cntrl #'s 418, 420
420 0.095 Daiwa Finance Corp. First Union Actual/360 Cntrl #'s 418, 419
421 0.095 Daiwa Finance Corp. First Union Actual/360
422 0.095 Daiwa Finance Corp. First Union Actual/360
423 0.095 Daiwa Finance Corp. First Union 30/360
424 0.095 Daiwa Finance Corp. First Union Actual/360
425 0.095 Daiwa Finance Corp. First Union Actual/360
426 0.095 Daiwa Finance Corp. First Union Actual/360
427 0.095 Daiwa Finance Corp. First Union Actual/360
428 0.095 Daiwa Finance Corp. First Union 30/360
429 0.095 Daiwa Finance Corp. First Union 30/360
430 0.095 Daiwa Finance Corp. First Union 30/360
431 0.095 Daiwa Finance Corp. First Union 30/360
432 0.095 Daiwa Finance Corp. First Union 30/360
433 0.095 Daiwa Finance Corp. First Union 30/360
434 0.095 Daiwa Finance Corp. First Union 30/360
435 0.095 Daiwa Finance Corp. First Union 30/360
436 0.095 Daiwa Finance Corp. First Union 30/360
437 0.095 Daiwa Finance Corp. First Union 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
438 37 Wales Street 37 Wales Street Dorchester MA 02124
439 Joanne Marie Apartments 807 N. W. 24th Street Wilton Manors FL 33311
440 Dorchester Apartments 1350-1358 Dorchester Avenue Dorchester MA 02122
441 Hillside Village Apartments 1401 East Dunlap Phoenix AZ 85020
442 Lake Forest Apartments 2320 N. Vermilion St. Danville IL 61832
443 Manor Apartments and Traymore Apartments 130 North McLean and 51 South McLean Memphis TN 38104
444 Shadow Oaks Apartments 1523 Heights Boulevard Houston TX 77008
445 Kimberly Oaks Apartments 1530 Heights Boulevard Houston TX 77008
446 Birch Row Apartments 1201 - 1211 Locust Street Philadelphia PA 19107
447 Mansard Place Apartments 6156 S. Loop East Houston TX 77087
448 Broadway Park Apartments 2505 Broadway Houston TX 77012
449 The Deely Place Apartments 8511 South Flores San Antonio TX 78221
450 Atlantic City Apartments 1901 Haren Drive Henderson NV 89015
451 Checker Auto Parts 2206 North Big Spring Street Midland TX 79705
452 The Samuel Building 7290 Samuel Drive Denver CO 80221
453 Canberra Apartments 2929 North 36th Street Phoenix AZ 85018
454 Rosewood Gardens 7 Charles Street Roselle NJ 07204
455 Hickory Apartments 320 South Jupiter Road Garland TX 75042
456 Dutch Haven Apartments 846 Piney Grove Columbia SC 29210
457 Robinswood Apartments 800 North Hastings Street Orlando FL 32808
458 Sunset Apartments 830 & 840 Sunset Drive Athens GA 30601
459 3301 Powelton Avenue 3301- 3315 Powelton Avenue Philadelphia PA 19104
460 Bryan Place Apartments 3219 San Jacinto Dallas TX 75044
461 Skyline Woods Apartments Skyline Drive Saugerties NY 12477
462 Sunrise Apartments 190 Kirkwood Road, NE Atlanta GA 30317
463 Featherstone Apartments 7800 - 7820 Featherstone Drive Raleigh NC 27612
464 Wayne Street Apartments 5339 Wayne Street Raleigh NC 27606
543 Castille Court Apartments 1811 Rogero Road Jacksonville FL 32211
465 The Villages Apartment 1775 Leon Road Jacksonville FL 32211
466 Seligson Portfolio - 605 West Avenue 605 West Avenue Norwalk CT 06850
467 Seligson Portfolio - 698 West Avenue 698 West Avenue Norwalk CT 06850
468 Seligson Portfolio - 17 Butler Street 17 Butler Street Norwalk CT 06850
469 McFarlin Condos 3412 McFarlin Blvd. University Park TX 75205
470 Palms at Byron Place 8535 Byron Avenue Miami Beach FL 33141
471 Olde North Village Apartments 3490 Triangle Drive Winston-Salem NC 27106
472 Savings Tower 45 Savings Street Waterbury CT 06702
473 Hawthorne Apartments 1491 Hawthorne Avenue Houston TX 77006
474 Oak Forest Apartments 3614 Pine Oak Avenue Southwest Wyoming MI 49509
475 Rampart Gardens Apartments 6300 Rampart Houston TX 77081
476 Morris Hall Apartments 357 Morris Street Albany NY 12207
477 English Hills II 2004 140th Avenue & 2005 142nd Avenue Tampa FL 33613
478 670 Garden Street 670 Garden Street Bronx NY 10457
479 Anna Hart Portfolio - 6 West 87th Street 6 West 87th Street New York NY 10024
480 Anna Hart Portfolio - 45 West 69th Street 45 West 69th Street New York NY 10023
481 Anna Hart Portfolio - 49 West 68th Street 49 West 68th Street New York NY 10023
482 Anna Hart Portfolio - 117 West 69th Street 117 West 69th Street New York NY 10023
483 Anna Hart Portfolio - 130 Beach 133rd Street 130 Beach 133rd Street Queens NY 11694
484 Anna Hart Portfolio - 148 West 76th Street 148 West 76th Street New York NY 10023
485 244 & 248 West 21st Street 244 & 248 West 21st Street New York NY 10011
488 Anna Hart Portfolio - 330 West 101st Street 330 West 101st Street New York NY 10025
489 Trinity Court Condominiums 6526 - 6530 Ridgecrest Dallas TX 75231
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------ MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
438 411,771.46 3,589.85 9.375 111 291 06/01/2007 No Balloon
439 381,726.97 3,363.73 9.500 110 290 05/01/2007 No Balloon
440 775,219.63 6,679.78 9.250 113 293 08/01/2007 No Balloon
441 546,077.00 5,173.33 9.500 229 229 04/01/2017 No Fully Amortizing
442 1,487,841.80 12,716.59 9.125 111 291 06/01/2007 No Balloon
443 683,728.75 6,251.86 10.000 292 292 07/01/2022 No Fully Amortizing
444 293,744.23 2,586.14 9.500 111 291 06/01/2007 No Balloon
445 331,454.62 2,918.15 9.500 111 291 06/01/2007 No Balloon
446 496,763.55 4,455.69 9.750 52 292 07/01/2002 No Balloon
447 1,786,541.39 14,951.76 8.875 112 292 07/01/2007 No Balloon
448 2,173,625.43 18,191.30 8.875 112 292 07/01/2007 No Balloon
449 846,675.92 6,839.29 9.000 113 353 08/01/2007 No Balloon
450 956,341.22 7,810.88 9.125 113 353 08/01/2007 No Balloon
451 516,942.28 4,543.22 9.500 293 293 08/01/2022 No Fully Amortizing
452 721,127.04 6,146.35 9.125 54 294 09/01/2002 No Balloon
453 992,786.08 7,884.50 8.250 113 293 08/01/2007 No Balloon
454 586,115.93 4,701.24 8.375 113 293 08/01/2007 No Balloon
455 696,202.14 5,755.01 8.750 114 294 09/01/2007 No Balloon
456 877,371.29 7,159.97 9.125 114 354 09/01/2007 No Balloon
457 671,337.80 5,549.47 8.750 114 294 09/01/2007 No Balloon
458 865,383.30 7,226.68 8.875 114 294 09/01/2007 No Balloon
459 577,527.15 4,867.34 9.000 115 295 10/01/2007 No Balloon
460 380,869.35 3,209.90 9.000 115 295 10/01/2007 No Balloon
461 746,654.17 6,166.08 8.750 115 295 10/01/2007 No Balloon
462 425,505.53 3,442.35 8.500 115 295 10/01/2007 No Balloon
463 597,323.35 4,932.86 8.750 115 295 10/01/2007 No Balloon
464 199,107.76 1,644.29 8.750 115 295 10/01/2007 No Balloon
543 482,836.35 3,987.40 8.750 115 295 10/01/2007 No Balloon
465 632,167.23 5,220.61 8.750 115 295 10/01/2007 No Balloon
466 4,133,387.11 31,170.90 8.010 115 325 10/01/2007 No Balloon
467 1,444,195.49 10,891.04 8.010 115 325 10/01/2007 No Balloon
468 5,577,582.60 42,061.94 8.010 115 325 10/01/2007 No Balloon
469 647,404.95 5,179.34 8.375 116 296 11/01/2007 No Balloon
470 796,934.29 6,509.34 8.625 116 296 11/01/2007 No Balloon
471 792,195.23 6,739.79 9.125 296 296 11/01/2022 No Fully Amortizing
472 896,332.90 7,096.05 8.250 116 296 11/01/2007 No Balloon
473 448,275.52 3,661.51 8.625 116 296 11/01/2007 No Balloon
474 399,141.19 3,254.53 9.125 236 356 11/01/2017 No Balloon
475 2,040,943.75 15,484.24 7.750 116 296 11/01/2007 No Balloon
476 637,496.61 5,153.45 8.500 116 296 11/01/2007 No Balloon
477 258,940.61 2,049.97 8.250 116 296 11/01/2007 No Balloon
478 745,462.39 6,747.94 9.000 236 236 11/01/2017 No Fully Amortizing
479 463,174.78 3,608.94 8.625 117 357 12/01/2007 No Balloon
480 211,622.97 1,648.91 8.625 117 357 12/01/2007 No Balloon
481 224,599.82 1,750.03 8.625 117 357 12/01/2007 No Balloon
482 328,414.86 2,558.93 8.625 117 357 12/01/2007 No Balloon
483 179,679.88 1,400.02 8.625 117 357 12/01/2007 No Balloon
484 339,395.29 2,644.49 8.625 117 357 12/01/2007 No Balloon
485 728,701.66 5,677.87 8.625 117 357 12/01/2007 No Balloon
488 386,311.70 3,010.05 8.625 117 357 12/01/2007 No Balloon
489 618,034.26 4,785.26 8.000 117 297 12/01/2007 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
438 0.095 Daiwa Finance Corp. First Union 30/360
439 0.095 Daiwa Finance Corp. First Union 30/360
440 0.095 Daiwa Finance Corp. First Union 30/360
441 0.095 Daiwa Finance Corp. First Union 30/360
442 0.095 Daiwa Finance Corp. First Union 30/360
443 0.095 Daiwa Finance Corp. First Union 30/360
444 0.095 Daiwa Finance Corp. First Union 30/360
445 0.095 Daiwa Finance Corp. First Union 30/360
446 0.095 Daiwa Finance Corp. First Union 30/360
447 0.095 Daiwa Finance Corp. First Union 30/360
448 0.095 Daiwa Finance Corp. First Union 30/360
449 0.095 Daiwa Finance Corp. First Union 30/360
450 0.095 Daiwa Finance Corp. First Union 30/360
451 0.095 Daiwa Finance Corp. First Union 30/360
452 0.095 Daiwa Finance Corp. First Union 30/360
453 0.095 Daiwa Finance Corp. First Union 30/360
454 0.095 Daiwa Finance Corp. First Union Actual/360
455 0.095 Daiwa Finance Corp. First Union Actual/360
456 0.095 Daiwa Finance Corp. First Union Actual/360
457 0.095 Daiwa Finance Corp. First Union Actual/360
458 0.095 Daiwa Finance Corp. First Union Actual/360
459 0.095 Daiwa Finance Corp. First Union Actual/360
460 0.095 Daiwa Finance Corp. First Union Actual/360
461 0.095 Daiwa Finance Corp. First Union Actual/360
462 0.095 Daiwa Finance Corp. First Union Actual/360
463 0.095 Daiwa Finance Corp. First Union Actual/360
464 0.095 Daiwa Finance Corp. First Union Actual/360
543 0.095 Daiwa Finance Corp. First Union Actual/360
465 0.095 Daiwa Finance Corp. First Union Actual/360
466 0.095 Daiwa Finance Corp. First Union Yes Actual/360 Cntrl #'s 467, 468
467 0.095 Daiwa Finance Corp. First Union Yes Actual/360 Cntrl #'s 466, 468
468 0.095 Daiwa Finance Corp. First Union Yes Actual/360 Cntrl #'s 466, 467
469 0.095 Daiwa Finance Corp. First Union Actual/360
470 0.095 Daiwa Finance Corp. First Union Actual/360
471 0.095 Daiwa Finance Corp. First Union Actual/360
472 0.095 Daiwa Finance Corp. First Union Actual/360
473 0.095 Daiwa Finance Corp. First Union Actual/360
474 0.095 Daiwa Finance Corp. First Union Actual/360
475 0.095 Daiwa Finance Corp. First Union Actual/360
476 0.095 Daiwa Finance Corp. First Union Actual/360
477 0.095 Daiwa Finance Corp. First Union Actual/360
478 0.095 Daiwa Finance Corp. First Union Actual/360
479 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
480 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
481 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
482 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
483 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
484 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
485 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
488 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
489 0.095 Daiwa Finance Corp. First Union Actual/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Conduit_Mtg_Sched
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
490 Townhouse Apartments 12621 Lomas Boulevard N.E. Albuquerque NM 87112
491 D'iberville Apartments 265 Front Beach Drive Ocean Springs MS 39564
492 Ricciuti Court Apartments 445 Shenandoah Drive Penn Hills PA 15235
493 495 Washington Avenue 495 Washinton Avenue Brooklyn NY 11238
494 The Tropic Estates Apartments 3044 Jamaica Drive Corpus Christi TX 78418
495 Glenoaks Apartments 8817 South 28th Street Fort Smith AR 72908
496 Gilmore Apartments 705-725 & 815 - 823 North Gilmore Avenue Lakeland FL 33801
497 Village Meadows 9801 Meandering Way Fort Smith AR 72903
498 Blair House Apartments 321-323 Montgomery and 324 N. Bellevue Memphis TN 38104
499 Tahiti Village Apartments 883 Buena Vista Avenue Pomona CA 91766
500 1011 Sheridan Avenue 1011 Sheridan Avenue Bronx NY 10456
501 Kirlin Place Apartments 27 Old Lawrence Road Pelham NH 03076
502 Las Casitas Apartments 4100 East 29th Street Tucson AZ 85711
503 Orangewood Place Apartments 7328 North 27th Avenue Phoenix AZ 85051
504 Edison Terrace Apartments 401 N. Ash Street Centralia WA 98531
505 Ramsey Apartments 201 - 207 East Glendale Avenue Alexandria VA 22030
506 Glendale Apartments 200-216 E. Glendale Avenue Alexandria VA 22301
507 Burton Gardens Apartments 300 - 311 East Glendale Avenue Alexandria VA 22030
508 Drexel Terrace Apartments 1356 & 1360 East Drexel Road Tucson AZ 85706
509 Lake Parker Apartments 730-810 East First Street Lakeland FL 33805
510 Corporate Point Office Building 14100 Park Meadow Drive Chantilly VA 20151
511 Great Western Bank Building 13701 - 13739 Riverside Drive Sherman Oaks CA 91423
512 Windsor Hall Apartments 179 Dwight Street New Haven CT 06533
513 Foresight Village Apartments - Phase II 620 25 1/2 Road Grand Junction CO 81501
514 Cedarhaus Apartments 4503-4509 So. Salina Street Syracuse NY 13205
515 Windsong Apartments 2320 North Garrett Drive Dallas TX 75206
516 Wellington Apartments 818 Forest Drive & 812 Woods Drive Newport News VA 23605
517 Golden Villas Apartments 4088-4136 Silver Dollar Las Vegas NV 89102
518 Parkwood Apartments 5917 Carmelita Avenue Huntington Park CA 90255
519 Manayunk Apartments 3901 Manayunk Avenue Philadelphia PA 19128
520 Folcroft Apartments 1503-1505, 1511, 1513, 1528 Elmwood
& 1528 Baltimore Folcroft PA 19032
521 Claridge Manor Apartments 72 - 92 Colonel Bell Drive Brockton MA 02401
522 Oakwood Apartments 1104 140th Street East Tampa FL 33613
523 Teesdale Apartments 1730-1736 Teesdale Street Philadelphia PA 19111
524 The Mase Building 6515 Main Street Trumbull CT 06611
525 Brandywine Apartments 4710 Lake Avenue Dallas TX 75219
526 Tropic Isle Apartments 260 East Newburgh Street Azusa CA 91702
527 Leisure Isle Apartments 3615 - 3623 Gilman Road El Monte CA 91732
528 Laurel Apartments 1420 - 1446 Laurel Avenue Pomona CA 91768
529 La Mesa Apartments 752 La Mesa Avenue Pomona CA 91766
530 Villa Fontana Apartments 3719 - 3725 Gilman Road El Monte CA 91732
531 Park Lane Apartments 2628 Maxson Road El Monte CA 91732
533 Comfort Inn - Ormond Beach 507 South Atlantic Avenue Ormond Beach FL 32176
534 Comfort Inn - St. Augustine 1111 N.Ponce De Leon Blvd. St. Augustine FL 32084
537 Ramada Inn - Katy 22025 IH-10 West Katy TX 77450
538 Quail Run 1000 South Clack Street Abilene TX 79605
544 Laurelwood Rehab and Skilled Nursing Center 642 Danbury Road Ridgefield CT 06877
539 The Sarvis Building and Conference Center 6104 and 6111 Gazebo Park Place North Jacksonville FL 32257
532 Lincoln Apartments 219 Lincoln Avenue Newark NJ 07104
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS --------------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
490 797,662.47 6,441.82 8.500 117 297 12/01/2007 No Balloon
491 897,203.89 7,021.04 8.125 117 297 12/01/2007 No Balloon
492 718,103.25 6,103.96 9.125 117 297 12/01/2007 No Balloon
493 518,449.11 4,143.47 8.375 117 297 12/01/2007 No Balloon
494 807,379.30 6,184.79 7.875 117 297 12/01/2007 No Balloon
495 1,064,675.20 8,591.77 8.500 118 298 01/01/2008 No Balloon
496 1,028,597.37 7,957.43 8.000 118 298 01/01/2008 No Balloon
497 458,997.74 3,704.04 8.500 118 298 01/01/2008 No Balloon
498 319,524.96 3,252.70 11.500 118 298 01/01/2008 No Balloon
499 1,496,770.32 11,453.31 7.875 118 298 01/01/2008 No Balloon
500 2,095,022.88 16,034.63 7.875 118 298 01/01/2008 No Balloon
501 708,429.51 5,934.01 9.350 103 343 10/01/2006 No Balloon
502 2,432,979.47 21,452.37 9.250 90 270 09/01/2005 No Balloon
503 1,241,302.69 10,812.79 9.375 111 291 06/01/2007 No Balloon
504 757,189.32 6,115.13 9.000 112 352 07/01/2007 No Balloon
505 844,531.04 6,844.43 8.500 113 293 08/01/2007 No Balloon
506 844,531.04 6,844.43 8.500 113 293 08/01/2007 No Balloon
507 1,142,600.83 9,260.11 8.500 113 293 08/01/2007 No Balloon
508 520,097.22 4,597.69 8.625 114 234 09/01/2007 No Balloon
509 583,659.53 4,563.67 8.125 118 298 01/01/2008 No Balloon
510 4,010,309.83 30,364.22 7.750 118 298 01/01/2008 No Balloon
511 3,191,482.35 22,657.78 7.020 118 298 01/01/2008 No Balloon
512 448,986.07 3,548.03 8.250 118 298 01/01/2008 No Balloon
513 748,824.78 5,503.23 8.000 118 358 01/01/2008 No Balloon
514 369,180.21 2,948.24 8.375 118 298 01/01/2008 No Balloon
515 398,831.23 3,220.91 8.500 117 297 12/01/2007 No Balloon
516 1,991,651.06 16,072.33 8.500 118 298 01/01/2008 No Balloon
517 748,252.23 5,788.62 8.000 118 298 01/01/2008 No Balloon
518 1,123,691.66 8,222.40 7.375 179 299 02/01/2013 No Balloon
519 2,745,629.75 19,877.19 7.250 119 299 02/01/2008 No Balloon
520 1,647,555.18 12,871.90 8.125 119 299 02/01/2008 No Balloon
521 2,146,653.36 15,888.31 7.500 119 299 02/01/2008 No Balloon
522 1,497,711.74 11,329.93 7.750 119 299 02/01/2008 No Balloon
523 271,599.26 2,135.50 8.200 119 299 02/01/2008 No Balloon
524 723,420.34 5,837.90 8.500 118 298 01/01/2008 No Balloon
525 828,161.02 6,613.61 8.375 118 298 01/01/2008 No Balloon
526 898,608.18 6,697.82 7.580 179 299 02/01/2013 No Balloon
527 1,021,417.96 7,613.19 7.580 179 299 02/01/2013 No Balloon
528 299,536.06 2,232.61 7.580 179 299 02/01/2013 No Balloon
529 522,191.20 3,892.18 7.580 179 299 02/01/2013 No Balloon
530 1,198,144.24 8,930.43 7.580 179 299 02/01/2013 No Balloon
531 1,048,376.20 7,814.13 7.580 179 299 02/01/2013 No Balloon
533 1,496,712.91 12,258.76 7.690 119 239 02/01/2008 No Balloon
534 3,094,545.64 23,899.36 7.650 119 275 02/01/2008 No Balloon
537 1,594,600.40 15,106.27 7.800 179 179 02/01/2013 No Fully Amortizing
538 1,104,312.78 8,353.94 7.750 119 299 02/01/2008 No Balloon
544 13,000,000.00 96,916.04 7.600 180 300 03/01/2013 No Balloon
539 2,596,679.29 19,599.60 8.050 119 329 02/01/2008 No Balloon
532 745,620.35 7,330.70 8.375 178 178 01/01/2013 No Fully Amortizing
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
490 0.095 Daiwa Finance Corp. First Union Actual/360
491 0.095 Daiwa Finance Corp. First Union Actual/360
492 0.095 Daiwa Finance Corp. First Union Actual/360
493 0.095 Daiwa Finance Corp. First Union Actual/360
494 0.095 Daiwa Finance Corp. First Union Actual/360
495 0.095 Daiwa Finance Corp. First Union Actual/360
496 0.095 Daiwa Finance Corp. First Union Actual/360
497 0.095 Daiwa Finance Corp. First Union Actual/360
498 0.095 Daiwa Finance Corp. First Union Actual/360
499 0.095 Daiwa Finance Corp. First Union 30/360
500 0.095 Daiwa Finance Corp. First Union Actual/360
501 0.095 Daiwa Finance Corp. First Union 30/360
502 0.095 Daiwa Finance Corp. First Union 30/360
503 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
504 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
505 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
506 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
507 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
508 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
509 0.095 Daiwa Finance Corp. First Union Actual/360
510 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
511 0.095 Daiwa Finance Corp. First Union Yes Actual/360
512 0.095 Daiwa Finance Corp. First Union Actual/360
513 0.095 Daiwa Finance Corp. First Union Actual/360
514 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
515 0.095 Daiwa Finance Corp. First Union Actual/360
516 0.095 Daiwa Finance Corp. First Union Actual/360
517 0.095 Daiwa Finance Corp. First Union Actual/360
518 0.095 Daiwa Finance Corp. First Union 30/360
519 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
520 0.095 Daiwa Finance Corp. First Union Actual/360
521 0.095 Daiwa Finance Corp. First Union Actual/360
522 0.095 Daiwa Finance Corp. First Union Actual/360
523 0.095 Daiwa Finance Corp. First Union Actual/360
524 0.095 Daiwa Finance Corp. First Union Actual/360
525 0.095 Daiwa Finance Corp. First Union Actual/360
526 0.095 Daiwa Finance Corp. First Union Actual/360
527 0.095 Daiwa Finance Corp. First Union Actual/360
528 0.095 Daiwa Finance Corp. First Union Actual/360
529 0.095 Daiwa Finance Corp. First Union Actual/360
530 0.095 Daiwa Finance Corp. First Union Actual/360
531 0.095 Daiwa Finance Corp. First Union Actual/360
533 0.095 Daiwa Finance Corp. First Union Actual/360
534 0.095 Daiwa Finance Corp. First Union Actual/360
537 0.095 Daiwa Finance Corp. First Union Yes Actual/360
538 0.095 Daiwa Finance Corp. First Union Actual/360
544 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
539 0.095 Daiwa Finance Corp. First Union Actual/360
532 0.095 Daiwa Finance Corp. First Union Actual/360
</TABLE>
<PAGE>
EXHIBIT C
FORM OF SCHEDULE OF EXCEPTIONS TO MORTGAGE FILE DELIVERY
MLMI 1998-C2
Control Borrower Document Document Exception
No. Name ID Status Description
------- -------- -------- -------- ------------
C-1
<PAGE>
EXHIBIT D-1
FORM OF MASTER SERVICER REQUEST FOR RELEASE
______________, 199_
Norwest Bank Minnesota, National Association
3 New York Plaza, 15th Floor
New York, New York 10004
Attention: Corporate Trust Services (CMBS)
Re: MLMI Series 1998-C2
--------------------
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 March 1,
1998 (the "Pooling and Servicing Agreement"), by and among Merrill Lynch
Mortgage Investors, Inc., as Depositor, First Union National Bank, as Master
Servicer, CRIIMI MAE Services Limited Partnership, as Special Servicer, 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.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
First Union National Bank,
as Master Servicer
By:_____________________________________
Name:
Title
D-1-2
<PAGE>
EXHIBIT D-2
FORM OF SPECIAL SERVICER REQUEST FOR RELEASE
_______________, 199_
Norwest Bank Minnesota, National Association
3 New York Plaza, 15th Floor
New York, New York 10004
Attention: Corporate Trust Services (CMBS)
Re: MLMI Series 1998-C2
-------------------
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 March 1,
1998 (the "Pooling and Servicing Agreement"), by and among Merrill Lynch
Mortgage Investors, Inc., as depositor, First Union National Bank, as Master
Servicer and CRIIMI MAE Services Limited Partnership, as Special Servicer, 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.
CRIIMI MAE Services Limited Partnership,
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 (as determined in accordance with the reserve requirements for such
Mortgaged Property set forth in Annex A to the Prospectus Supplement). Net
Operating Income 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 and certain single tenant properties, space occupied
by anchor tenants or single 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. Private occupancy rates
shall be within current market ranges and vacancy levels shall be at a minimum
of __%. 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.
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
E-1-1
<PAGE>
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 5% of gross
receipts shall be assumed, single tenant properties, where a minimum of 4% of
gross receipts shall be assumed and self-storage properties, where a minimum of
5% 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 (as determined in accordance with the reserve
requirements for such Mortgaged Property set forth in Annex A to the Prospectus
Supplement) 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 $0.15 and not more than $0.46 per square foot net rentable
commercial area (except with respect to two Mortgage Loans, or 2%, where $0.12
and $0.10 was assumed, respectively, (2) in the case of multifamily and one
mixed use multifamily retail properties, not less than $150 or more than $374
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 a ongoing basis, (4) in the case of the manufactured housing
communities, not less than $25 or more than $51 per pad per year and (5) in the
case of self-storage facilities, not less than $0.05 or more than $0.34 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 cash flow") where determined
appropriate.
E-1-2
<PAGE>
EXHIBIT F-1
FORM OF TRANSFEROR CERTIFICATE
______ __, 199_
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attn: Corporate Trust Services (CMBS)
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1998-C2
(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 March 27, 1998 (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 March 1, 1998,
among Merrill Lynch Mortgage Investors, Inc., as depositor, First Union National
Bank, as master servicer, CRIIMI MAE Services Limited Partnership, as special
servicer, and Norwest Bank Minnesota, National Association, 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 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
F-1-1
<PAGE>
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, 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 Securities Act of
1933, as amended (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-1-2
<PAGE>
EXHIBIT F-2
FORM OF TRANSFEREE CERTIFICATE
FOR QIBs
______ __, 199_
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attn: Corporate Trust Services (CMBS)
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1998-C2
(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 March 27, 1998 (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 March 1, 1998,
among Merrill Lynch Mortgage Investors, Inc., as depositor, First Union National
Bank, as master servicer, CRIIMI MAE Services Limited Partnership, as special
servicer, and Norwest Bank Minnesota, National Association, as trustee. 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, as
amended (the "Securities Act"), and has completed one of the forms of
certification to that effect attached hereto as Annex 1 and Annex 2. The
Transferee is aware that the sale to it is being made in reliance on Rule
144A. The Transferee is acquiring the Transferred 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
F-2-1
<PAGE>
buyer to whom notice is given that the resale, pledge or transfer is being
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.
3. If the Transferee is proposing that the Certificates being acquired
should be registered in the name of a nominee, such nominee's name is
specified hereafter and the Transferee has caused the execution of the
Nominee Acknowledgment below.
Nominee (if any): _________________________________________
Very truly yours,
______________________________
(Transferee)
By:___________________________
Name:_________________________
Title:________________________
Nominee Acknowledgment
The undersigned hereby acknowledges and confirms that the Certificate
referred to in this Transferee Certificate that are to be registered in its name
are and shall be held solely for the benefit of the above Transferee.
By: _________________________
Name:
Title:
F-2-2
<PAGE>
ANNEX 1 TO EXHIBIT F-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies to [name of Transferor] (the "Transferor")
and Norwest Bank Minnesota, National Association, 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 as
follows:
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 ("Rule 144A") under the Securities Act of 1933, as amended
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) [The 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, the Transferee must own and/or invest on, a
discretionary basis at least $10,000,000 in securities or is acting in a
riskless principal transaction on behalf of a qualified institutional investor.]
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, as amended.
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
F-2-3
<PAGE>
preceding such date of sale for a foreign bank or equivalent
institution.
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, as amended.
o Investment Advisor. The Transferee is an investment advisor registered
under the Investment Advisers Act of 1940, as amended.
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.) _______________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
F-2-4
<PAGE>
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Transferee, (ii) securities that are part
of an unsold allotment to or subscription by the Transferee, if the Transferee
is a dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but subject to
a repurchase agreement and (vii) currency, interest rate and commodity swaps.
For purposes of determining the aggregate amount of securities owned and/or
invested on a discretionary basis by the Transferee, the Transferee did not
include any of the securities referred to in this paragraph.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Transferee, the Transferee used
the cost of such securities to the Transferee, unless the Transferee reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities were valued at market. Further,
in determining such aggregate amount, the Transferee may have included
securities owned by subsidiaries of the Transferee, but only if such
subsidiaries are consolidated with the Transferee in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Transferee's direction.
However, such securities were not included if the Transferee is a
majority-owned, consolidated subsidiary of another enterprise and the Transferee
is not itself a reporting company under the Securities Exchange Act of 1934.
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
--- --- Transferred Certificate only for the
Yes No 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
F-2-5
<PAGE>
conclusions herein. Until such notice is given, the Transferee's purchase of the
Transferred Certificate will constitute a reaffirmation of this certification as
of the date of such purchase. In addition, if the Transferee is a bank or
savings and loan as provided above, the Transferee agrees that it will furnish
to such parties any updated annual financial statements that become available on
or before the date of such purchase, promptly after they become available.
_______________________________
Print Name of Transferee
By:_____________________________________
Name:_____________________________________
Title:_____________________________________
_____________________________________
Date:_____________________________________
F-2-6
<PAGE>
ANNEX 2 TO EXHIBIT F-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies to [name of Transferor] (the "Transferor")
and Norwest Bank Minnesota, National Association, 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 as
follows:
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, as amended ("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, as amended, 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.
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.
6. 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
___ ___ Transferred Certificate only for the
Yes No Transferee's own account?
7. 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
F-2-8
<PAGE>
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 INTENTIONALLY LEFT 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-2-10
<PAGE>
EXHIBIT F-3
FORM OF TRANSFEREE CERTIFICATE
FOR non-QIBs
______ __, 199_
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attn: Corporate Trust Services (CMBS)
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificate, Series 1998-C2,
(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 March 27, 1998 (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 March 1, 1998,
among Merrill Lynch Mortgage Investors, Inc., as depositor (the "Depositor"),
First Union National Bank, as master servicer, CRIIMI MAE Services Limited
Partnership, as special servicer, and Norwest Bank Minnesota, National
Association. 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 (i) registered pursuant to the
Securities Act and registered or qualified pursuant to any applicable state
securities laws or
F-3-1
<PAGE>
(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, AS AMENDED (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 any of the acts described in
clauses (a) through (e) above) would constitute a distribution of any
Certificate under the Securities
F-3-2
<PAGE>
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.
7. If the Transferee is proposing that the Certificates being acquired
should be registered in the name of a nominee, such nominee's name is specified
hereafter and the Transferee has caused the execution of the Nominee
Acknowledgment below.
Nominee (if any): _____________________________
Very truly yours,
______________________________
(Transferee)
By:___________________________
Name:_________________________
Title:________________________
Nominee Acknowledgment
----------------------
The undersigned hereby acknowledges and confirms that the Certificate
referred to in this Transferee Certificate that are to be registered in its name
are and shall be held solely for the benefit of the above Transferee.
By: _________________________
Name:
Title:
F-3-3
<PAGE>
EXHIBIT G
FORM OF TRANSFEREE LETTER
FOR TRANSFERS OF SUBORDINATED CERTIFICATES
TO NON-PLAN ENTITIES
_____ __, 199_
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attn: Corporate Trust Services (CMBS)
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1998-C2
(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 March 27, 1998 (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 March 1, 1998 (the "Pooling and Servicing Agreement"),
among Merrill Lynch Mortgage Investors, Inc., as depositor, First Union National
Bank, as master servicer, CRIIMI MAE Services Limited Partnership, as special
servicer, and Norwest Bank Minnesota, National Association, 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 either (i) 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), or (ii) the Transferee is an
insurance company general account, the Certificates are eligible for exemptive
relief under Section III of the Prohibited Transaction Class Exemption 95-60
("PTE 95-90"), and the conditions of Sections I, III and IV of PTE 95-60 will be
satisfied with respect to the transfer of the Certificates.
G-1-1
<PAGE>
IN WITNESS WHEREOF, the undersigned has executed this certificate as of the
date first written above.
[Name of Transferee]
By:___________________________
Name:_________________________
Title:________________________
G-1-2
<PAGE>
EXHIBIT H-1
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
REGARDING CLASS R-I, R-II AND R-III CERTIFICATES
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
1998-C2, 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 March 1, 1998, among Merrill Lynch
Mortgage Investors, Inc., as Depositor, First Union National Bank, as
Master Servicer, CRIIMI MAE Services Limited Partnership, as Special
Servicer, and Norwest Bank Minnesota, National Association, 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 Internal
Revenue Code of 1986, as amended (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
H-1-1
<PAGE>
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 is includible in gross income
for United States federal income tax purposes regardless of its source, 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.
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 Code that applies to all transfers of the Class
[R-I, R-II, R-III] Certificates; (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
H-1-2
<PAGE>
"pass through entity" includes a regulated investment company, a real
estate investment trust or common trust fund, a partnership, trust or
estate, and certain cooperatives.
5. 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
H-1-3
<PAGE>
outstanding. In this regard, the Owner hereby represents to 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_.
_____________________________________
NOTARY PUBLIC
COUNTY OF ______________
STATE OF _______________
My Commission expires the
____ day of _____________, 19__.
H-1-5
<PAGE>
EXHIBIT H-2
FORM OF TRANSFEROR CERTIFICATE
REGARDING CLASS R-I, R-II AND R-III CERTIFICATES
________________, 199_
Norwest Bank Minnesota, National Association
Norwest Center
Sixth and Marquette
Minneapolis, Minnesota 55479-0113
Attn: Corporate Trust Services (CMBS)
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage
Pass-Through Certificates, Series 1998-C2, 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 March 1, 1998, among
Merrill Lynch Mortgage Investors, Inc., as depositor, First Union National Bank,
as master servicer, CRIIMI MAE Services Limited Partnership, as special
servicer, and Norwest Bank Minnesota, National Association, 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:
1. No purpose of the Transferor relating to the transfer of the Class
[R-I, R-II, R-III] Certificates by the
H-2-1
<PAGE>
Transferor to the Transferee is or will be to impede the assessment or
collection of any tax.
2. The Transferor understands that the Transferee has delivered to you
a Transfer Affidavit and Agreement in the form attached to the Pooling and
Servicing Agreement as Exhibit H-1. The Transferor does not know or believe
that any representation contained therein is false.
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,
Transferor: _____________________
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
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 March 1, 1998 relating to Merrill Lynch Mortgage
Investors Inc., Mortgage Pass-Through Certificates, Series 1998-C2 (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 deliver to Norwest
Bank Minnesota, National Association, 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
Very truly yours,
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION
By: ______________________________
Title: ___________________________
I-1-2
<PAGE>
Receipt acknowledged:
Standard & Poor's Ratings Agency Moody's Investors Service, Inc.
By:_________________ By:_________________
Title:______________ Title:______________
Date:_______________ Date:_______________
I-1-3
<PAGE>
EXHIBIT I-2
FORM OF ACKNOWLEDGMENT OF PROPOSED SPECIAL SERVICER
_________________, 199_
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: Corporate Trust Services (CMBS)
Ladies & Gentlemen:
Pursuant to Section 6.09 of the Pooling and Servicing Agreement dated as of
March 1, 1998 relating to Merrill Lynch Mortgage Investors Inc., Mortgage
Pass-Through Certificates, Series 1998-C2 (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
[Reserved]
J-1
<PAGE>
EXHIBIT K
Form of Schedule of Certificateholders
Initial
Class Certificate Principal Balance Name of Holder Address
----- ----------------------------- -------------- -------
K-1
<PAGE>
EXHIBIT L
Form of CSSA Property File Report
L-1
<PAGE>
<TABLE>
<CAPTION>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- -------------------------------------------------------------- ----------------------------------------------------
FIELD FORMAT
FIELD NAME NUMBER TYPE EXAMPLE
- -------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C>
Transaction Id 1 AN XXX97001
Loan ID 2 AN XXX9701A
Prospectus Loan ID 3 AN 00000000012345
Property ID 4 AN 1001-001
Distribution Date 5 AN YYYYMMDD
Cross-Collateralized Loan Grouping 6 Numeric 9(3)
Property Name 7 AN Text
Property Address 8 AN Text
Property City 9 AN Text
Property State 10 AN FL
Property Zip Code 11 AN 30303
Property County 12 AN Text
Property Type Code 13 AN MF
Year Built 14 AN YYYY
Year Last Renovated 15 AN YYYY
Net Square Feet At Securitization 16 Numeric 25000
# Of Units/Beds/Rooms At Securitization 17 Numeric 75
Property Status 18 AN 1
Allocated Percentage of Loan at Securitization 19 Numeric 0.75
Current Allocated Percentage 20 Numeric 0.75
Current Allocated Loan Amount 21 Numeric 5900900
Ground Lease (Y/S/N) 22 AN N
Other Escrow / Reserve Balances 23 Numeric 25000
Most Recent Appraisal Date 24 AN YYYYMMDD
Most Recent Appraisal Value 25 Numeric 1000000
Date Asset is Expected to Be Resolved 26 AN YYYYMMDD
Foreclosure Date 27 AN YYYYMMDD
- -------------------------------------------------------------- ----------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
FIELD CSSA
NUMBER DESCRIPTION/COMMENTS LOAN
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1 S1,P1
2 S3,P3
3 From Offering Document S4,P4
4 Should contain Prospectus ID and propety identifier, e.g., 1001-001, 1000-002
5 P5
6 All Loans With The Same Numeric Value Are Crossed S75
7 S55
8 S56
9 S57
10 S58
11 S59
12 S60
13 S61
14 S64
15 P80
16 RT, IN, WH, OF, MU, SS,OT = SF S62
17 MF, MHP, LO, HC = Units S63
18 1=FCL, 2=REO, 3=Defeased, 4=Partial Release, 5= Released, 6= Same as at securitization
19 Issuer to allocate loan % attributable to property for multi-property loans
20 Calculation based on Current Allocated Loan Amount and Current SPB for associated loan.
21 Maintained by servicer. P7
22 Either Y=Yes, S=Subordinate, N= No ground lease S74
23 S77
24 P74
25 P75
26 Could be different dates for different properties if foreclosing P79
27 P42
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 1 of 9
L-2
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- -------------------------------------------------------------- ----------------------------------------------------
FIELD FORMAT
FIELD NAME NUMBER TYPE EXAMPLE
- -------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C>
REO Date 28 AN YYYYMMDD
Occupancy % 29 Numeric 0.75
Occupancy Date 30 Numeric YYYYMMDD
Date Lease Rollover Review 31 AN YYYYMMDD
% Sq. Feet expiring 1-12 months 32 Numeric 0.20
% Sq. Feet expiring 13-24 months 33 Numeric 0.20
% Sq. Feet expiring 25-36 months 34 Numeric 0.20
% Sq. Feet expiring 37-48 months 35 Numeric 0.20
% Sq. Feet expiring 49-60 months 36 Numeric 0.20
Largest Tenant 37 AN Text
Square Feet of Largest Tenant 38 Numeric 15000
2nd Largest Tenant 39 AN Text
Square Feet of 2nd Largest Tenant 40 Numeric 15000
3rd Largest Tenant 41 AN Text
Square Feet of 3rd Largest Tenant 42 Numeric 15000
Fiscal Year End Month 43 Numeric 12
Securitization Financials As Of Date 44 AN YYYYMMDD
Revenue At Securitization 45 Numeric 1000000
Operating Expenses At Securitization 46 Numeric 1000000
NOI At Securitization 47 Numeric 1000000
DSCR At Securitization 48 Numeric 1.5
Appraisal Value At Securitization 49 Numeric 1000000
Appraisal Date At Securitization 50 AN YYYYMMDD
Physical Occupancy At Securitization 51 Numeric
Date of Last Inspection 52 AN YYYYMMDD
- -------------------------------------------------------------- ----------------------------------------------------
<CAPTION>
- --------------- --------------------------------------------------------------------------------- -------------------
FIELD CSSA
NUMBER DESCRIPTION/COMMENTS LOAN
- --------------- --------------------------------------------------------------------------------- -------------------
<S> <C> <C>
28 P43
29 Map to "Most Recent Fiscal YTD Phys. Occ." in CSSA P71
30 Add a new field to the CSSA Loan file. P71
31 Roll over review to be completed every 12 months
32
33
34
35
36
37 For Office, WH, Retail, Industrial *Only if disclosed in the offering document
38
39 For Office, WH, Retail, Industrial *Only if disclosed in the offering document
40
41 For Office, WH, Retail, Industrial *Only if disclosed in the offering document
42
43 Needed to indicate month ending for borrower's Fiscal Year
44 S72
45 S70
46 S71
47 S65
48 S66
49 S67
50 S68
51 S69
52
- --------------- --------------------------------------------------------------------------------- -------------------
</TABLE>
Page 2 of 9
L-3
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- --------------------------------------------- --------------------------------------------- --------------------- ----------
FIELD FORMAT CSSA
FIELD NAME NUMBER TYPE EXAMPLE DESCRIPTION/COMMENTS LOAN
- --------------------------------------------- --------------------------------------------- --------------------- ----------
<S> <C> <C> <C> <C>
Preceding FY Financial As of Date 53 AN YYYYMMDD P58
Preceding Fiscal Year Revenue 54 Numeric 1,000,000 P52
Preceding Fiscal Year Expenses 55 Numeric 1,000,000 P53
Preceding Fiscal Year NOI 56 Numeric 1,000,000 P54
Preceding Fiscal Year Debt Service Amt. 57 Numeric 1,000,000 P55
Preceding Fiscal Year DSCR 58 Numeric 1.30 P56
Preceding Fiscal Year Physical Occupancy 59 Numeric 0.90 P57
Sec Preceding FY Financial As of Date 60 AN YYYYMMDD P65
Second Preceding FY Revenue 61 Numeric 1,000,000 P59
Second Preceding FY Expenses 62 Numeric 1,000,000 P60
Second Preceding FY NOI 63 Numeric 1,000,000 P61
Second Preceding FY Debt Service 64 Numeric 1,000,000 P62
Second Preceding FY DSCR 65 Numeric 1.30 P63
Sec Preceding FY Physical Occupancy 66 Numeric 0.90 P64
- --------------------------------------------- --------------------------------------------- --------------------- ----------
</TABLE>
Page 3 of 9
L-4
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ------------------------------------------------------------------------------------------------------------------------------------
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Transaction Id Same as CSSA Loan File
Loan ID Same as CSSA Loan File
Prospectus Loan ID Same as CSSA Loan File
Property ID
Distribution Date Same as CSSA Loan File
Cross-Collateralized Loan Grouping
Property Name If Multi-Prop, no rollup to CSSA Loan File. Populate S55 with"Various."
Property Address If Multi-Prop, no rollup to CSSA Loan File. Populate S56 with"Various."
Property City If Multi-Prop, and all same then populate S57 with City, otherwise,
"Various". Missing info= "incomplete"
Property State If Multi-Prop, and all same then populate S58 with State, otherwise,
"Various". Missing info= "incomplete"
Property Zip Code If Multi-Prop, and all same then populate S59 with Zip, otherwise, "Various".
Missing info= "incomplete"
Property County If Multi-Prop, and all same then populate S60 with County, otherwise, "Various".
Missing info= "incomplete"
Property Type Code If Multi-Prop and all same then populate S61 with property type otherwise
"Various". Missing Info ="incomplete"
Year Built If Multi-Prop, and all same then populate S64 with year otherwise, "000000".
Year Last Renovated If Multi-Prop, and all same then populate P80 with year otherwise, "000000".
Net Square Feet At Securitization Roll-up to loan file if populated. If missing one or more than populate
with "00000"
# Of Units/Beds/Rooms At Securitization Roll-up to loan file if populated. If missing one or more than populate
with "00000"
Property Status If multi-prop and all same than populate CSSA Loan file with property, status,
otherwise various.
Allocated Percentage of Loan at Securitization No field needed in Cssa Loan file
Current Allocated Percentage No field needed in Cssa Loan file
Current Allocated Loan Amount Roll-up to Current Ending SPB (P7)
Ground Lease (Y/S/N) If any property is Y, or S then S74=Y
Other Escrow / Reserve Balances If any property populated, then S77=Y
Most Recent Appraisal Date If Multi-Prop, and all same then populate P74 with date, otherwise, "000000".
Most Recent Appraisal Value Roll-up to CSSA Loan File if populated. If missing any appraisal value, than
populate P75 with "000000)
Date Asset is Expected to Be Resolved If Multi-Prop, latest date from affiliated properties for P79.
Foreclosure Date If Multi-Prop, and all same then populate P42 with date, otherwise, "000000".
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 4 of 9
L-5
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ------------------------------------------------------------------------------------------------------------------------------------
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
REO Date If Multi-Prop, and all same then populate P43 with date, otherwise, "000000".
Occupancy % [Weighted Average] For P71=Sum((Curr. Allocated % Prop A) *(Occupancy Prop A)...
(Curr. Allocated % Prop Z) * (Occupancy Prop Z)). If missing one, then, "00000"
Occupancy Date If Multi-Prop, and all same then populate with date, otherwise, "various+K62".
Date Lease Rollover Review No Roll up to the CSSA loan format.
% Sq. Feet expiring 1-12 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 13-24 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 25-36 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 37-48 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 49-60 months No Roll up to the CSSA loan format.
Largest Tenant No Roll up to the CSSA loan format.
Square Feet of Largest Tenant No Roll up to the CSSA loan format.
2nd Largest Tenant No Roll up to the CSSA loan format.
Square Feet of 2nd Largest Tenant No Roll up to the CSSA loan format.
3rd Largest Tenant No Roll up to the CSSA loan format.
Square Feet of 3rd Largest Tenant No Roll up to the CSSA loan format.
Fiscal Year End Month No Roll up to the CSSA loan format.
Securitization Financials As Of Date If Multi-Prop, and all same then populate S72 with date, otherwise, "000000".
Revenue At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S70 with "0000"
Operating Expenses At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S71 with "0000"
NOI At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S85 with "0000"
DSCR At Securitization [Weighted Average] S66=Sum((Allocated % at Sec. Prop A) *(DSCR Prop A)...
((Allocated % at Sec. Prop Z) * (DSCR Prop Z). If missing one, "00000"
Appraisal Value At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S70 with "0000"
Appraisal Date At Securitization If Multi-Prop, and all same then populate S68 with date, otherwise, "000000".
Physical Occupancy At Securitization Weighted Average
Date of Last Inspection
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 5 of 9
L-6
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ------------------------------------------------------------------------------------------------------------------------------------
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Preceding FY Financial As of Date If Multi-Prop, and all same then populate P58 with date, otherwise, "000000+K23K46".K1
Preceding Fiscal Year Revenue No Roll up to the CSSA loan format.
Preceding Fiscal Year Expenses No Roll up to the CSSA loan format.
Preceding Fiscal Year NOI No Roll up to the CSSA loan format.
Preceding Fiscal Year Debt Service Amt. No Roll up to the CSSA loan format.
Preceding Fiscal Year DSCR No Roll up to the CSSA loan format.
Preceding Fiscal Year Physical Occupancy No Roll up to the CSSA loan format.
Sec Preceding FY Financial As of Date No Roll up to the CSSA loan format.
Second Preceding FY Revenue No Roll up to the CSSA loan format.
Second Preceding FY Expenses No Roll up to the CSSA loan format.
Second Preceding FY NOI No Roll up to the CSSA loan format.
Second Preceding FY Debt Service No Roll up to the CSSA loan format.
Second Preceding FY DSCR No Roll up to the CSSA loan format.
Sec Preceding FY Physical Occupancy No Roll up to the CSSA loan format.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 6 of 9
L-7
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- --------------------------------------------------
FIELD NAME
- --------------------------------------------------
Transaction Id
Loan ID
Prospectus Loan ID
Property ID
Distribution Date
Cross-Collateralized Loan Grouping
Property Name
Property Address
Property City
Property State
Property Zip Code
Property County
Property Type Code
Year Built
Year Last Renovated
Net Square Feet At Securitization
# Of Units/Beds/Rooms At Securitization
Property Status
Allocated Percentage of Loan at Securitization
Current Allocated Percentage
Current Allocated Loan Amount
Ground Lease (Y/S/N)
Other Escrow / Reserve Balances
Most Recent Appraisal Date
Most Recent Appraisal Value
Date Asset is Expected to Be Resolved
Foreclosure Date
- --------------------------------------------------
Page 7 of 9
L-8
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ----------------------------------------
FIELD NAME
- ----------------------------------------
REO Date
Occupancy % "00000"
Occupancy Date
Date Lease Rollover Review
% Sq. Feet expiring 1-12 months
% Sq. Feet expiring 13-24 months
% Sq. Feet expiring 25-36 months
% Sq. Feet expiring 37-48 months
% Sq. Feet expiring 49-60 months
Largest Tenant
Square Feet of Largest Tenant
2nd Largest Tenant
Square Feet of 2nd Largest Tenant
3rd Largest Tenant
Square Feet of 3rd Largest Tenant
Fiscal Year End Month
Securitization Financials As Of Date
Revenue At Securitization
Operating Expenses At Securitization
NOI At Securitization
DSCR At Securitization
Appraisal Value At Securitization
Appraisal Date At Securitization
Physical Occupancy At Securitization
Date of Last Inspection
- ----------------------------------------
Page 8 of 9
L-9
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ----------------------------------------------
FIELD NAME
- ----------------------------------------------
Preceding FY Financial As of Date
Preceding Fiscal Year Revenue
Preceding Fiscal Year Expenses
Preceding Fiscal Year NOI
Preceding Fiscal Year Debt Service Amt.
Preceding Fiscal Year DSCR
Preceding Fiscal Year Physical Occupancy
Sec Preceding FY Financial As of Date
Second Preceding FY Revenue
Second Preceding FY Expenses
Second Preceding FY NOI
Second Preceding FY Debt Service
Second Preceding FY DSCR
Sec Preceding FY Physical Occupancy
- ----------------------------------------------
Page 9 of 9
L-10
<PAGE>
EXHIBIT M
COMPARATIVE FINANCIAL STATUS REPORT
as of ____________________
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
S4 S57 S58 P7 P8 S72 S69 S70 S65 S66
- ---------------------------------------------------------------------------------------------------------------
ORIGINAL UNDERWRITING
- ---------------------------------------------------------------------------------------------------------------
INFORMATION
- ---------------------------------------------------------------------------------------------------------------
BASIS YEAR
- ---------------------------------------------------------------------------------------------------------------
Last
Property Scheduled Paid Annual Financial
Prospectus Inspect Loan Thru Debt Info as of % Total $ (1)
ID City State Date Balance Date Service Date Occ Revenue NOI DSCR
yy/mm yy/mm
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
List all loans currently in deal with or without information largest to smallest loan
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
Total $ $ WA $ $ WA
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
===============================================================================================================
RECEIVED
- ---------------------------------------------------------------------------------------------------------------
FINANCIAL INFORMATION: LOANS BALANCE
- ---------------------------------------------------------------------------------------------------------------
# % $ %
- ---------------------------------------------------------------------------------------------------------------
CURRENT FULL YEAR:
- ---------------------------------------------------------------------------------------------------------------
CURRENT FULL YR. RECEIVED WITH DSC <1:
- ---------------------------------------------------------------------------------------------------------------
PRIOR FULL YEAR:
- ---------------------------------------------------------------------------------------------------------------
PRIOR FULL YR. RECEIVED WITH DSC <1:
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------
S4 P65 P64 P59 P61 P63 P58 P57 P52 P54 P56
- ------------------------------------------------------------------------------------------------
2ND PRECEDING ANNUAL OPERATING PRECEDING ANNUAL OPERATING
- ------------------------------------------------------------------------------------------------
INFORMATION INFORMATION
- ------------------------------------------------------------------------------------------------
AS OF ___________ NORMALIZED AS OF ___________ NORMALIZED
- ------------------------------------------------------------------------------------------------
Financial Financial
Prospectus Info as of % Total $ (1) Info as of % Total $ (1)
ID Date Occ Revenue NOI DSCR Date Occ Revenue NOI DSCR
yy/mm yy/mm
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
Total WA $ $ WA WA $ $ WA
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
=========================================================================================================================
REQUIRED
- -------------------------------------------------------------------------------------------------------------------------
FINANCIAL INFORMATION: LOANS BALANCE
- -------------------------------------------------------------------------------------------------------------------------
# % $ %
- -------------------------------------------------------------------------------------------------------------------------
CURRENT FULL YEAR:
- -------------------------------------------------------------------------------------------------------------------------
CURRENT FULL YR. RECEIVED WITH DSC <1:
- -------------------------------------------------------------------------------------------------------------------------
PRIOR FULL YEAR:
- -------------------------------------------------------------------------------------------------------------------------
PRIOR FULL YR. RECEIVED WITH DSC <1:
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
- -------------------------------------------------------------------------------
S4 P72 P73 P66 P68 P70 (2)
- -------------------------------------------------------------------------------
TRAILING FINANCIAL NET CHANGE
- -------------------------------------------------------------------------------
INFORMATION
- -------------------------------------------------------------------------------
MONTH REPORTED ACTUAL PRECEDING & BASIS
- -------------------------------------------------------------------------------
%
Prospectus FS Start FS End Total $ (%) % Total (1)
ID Date Date Revenue NOI DSC Occ Revenue DSC
yy/mm yy/mm
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Total WA $ $ WA WA $ WA
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
===============================================================================
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
M-1
<PAGE>
EXHIBIT N
REO STATUS REPORT
as of ____________________
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 S62 or P8 P7 P37 P39 P38
- -------------------------------------------------------------------------------------------------------------------------
S63 (a) (b) (c) (d)
- -------------------------------------------------------------------------------------------------------------------------
PROSPECTUS SHORT NAME PROPE CITY STATE SQ FT PAID SCHEDULED TOTAL TOTAL OTHER
ID (WHEN RTY OR THRU LOAN P&I EXPENSES ADVANCES
APPROPRIATE) TYPE UNITS DATE BALANCE ADVANCES TO DATE (TAXES &
TO DATE ESCROW)
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
S4 P25 P11 P58 P54 P81 P74 P75
- ---------------------------------------------------------------------------------------------------------------------
(e)=a+b+c+d (k) (j) (f)=(k/j) (g)
- ---------------------------------------------------------------------------------------------------------------------
PROSPECTUS TOTAL CURRENT MATURITY LTM LTM CAP VALUATION VALUE APPRAISAL
ID EXPOSURE MONTHLY DATE NOI NOI / RATE DATE USING BPO OR
P&I DATE DSC ASSIGN NOI & INTERNAL
CAP RATE VALUE**
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -----------------------------------------------------------------------------------------------------
S4 P35 P77 P82 P79
- -----------------------------------------------------------------------------------------------------
(h)=(.92*g) (i)=(g/e)
- -----------------------------------------------------------------------------------------------------
PROSPECTUS LOSS ESTIMATED TOTAL TRANSFER REO PENDING
ID USING RECOVERY APPRAISAL DATE AQUISITION RESOLUTION COMMENTS
92% % REDUCTION DATE DATE
APPR. OR REALIZED
BPO (f)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------
</TABLE>
(1) Use the following codes; App. - Appraisal, BPO - Brokers Opinion, Int -
Internal Value
N-1
<PAGE>
EXHIBIT O
SERVICER WATCH LIST
as of ____________________
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 P7 P8 P11 P54
- ------------------------------------------------------------------------------------------------------------------------------------
PROSPECTUS SHORT NAME PROPERTY CITY STATE SCHEDULED PAID MATURITY LTM COMMENT / REASON ON WATCH LIST
ID (WHEN TYPE LOAN THRU DATE DSCR
APPROPRIATE) BALANCE DATE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
List all loans on watch list and reason sorted in decending balance order.
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Total: $
- ------------------------------------------------------------------------------------------------------------------------------------
*LTM - Last 12 months either trailing or last annual
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
O-1
<PAGE>
EXHIBIT P
DELINQUENT LOAN STATUS REPORT
AS OF ____________________
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 S62 OR S63 P8 P7 P37 P39
- ------------------------------------------------------------------------------------------------------------------------------------
(A) (B) (C)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
SHORT NAME PAID SCHEDULED TOTAL P&I TOTAL
PROSPECTUS (WHEN PROPERTY SQ FT OR THRU LOAN ADVANCES EXPENSES
ID APPROPRIATE) TYPE CITY STATE UNITS DATE BALANCE TO DATE TO DATE
- ------------------------------------------------------------------------------------------------------------------------------------
90 + DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
60 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
30 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Current & at Special Servicer
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
FCL - Foreclosure
- ------------------------------------------------------------------------------------------------------------------------------------
LTM - Latest 12 Months either Last Annual or Trailing 12 months
- ------------------------------------------------------------------------------------------------------------------------------------
* Workout Strategy should match the CSSA Loan file using abreviated words in
place of a code number such as (FCL - In Foreclosure, MOD - Modification,
DPO - Discount Payoff, NS - Note Sale, BK - Bankrupcy, PP - Payment Plan,
TBD - To Be Determined etc...)
- ------------------------------------------------------------------------------------------------------------------------------------
It is possible to combine the status codes if the loan is going in more
than one direction. (i.e. FCL/Mod, BK/Mod, BK/FCL/DPO)
- ------------------------------------------------------------------------------------------------------------------------------------
** App - Appraisal, BPO - Broker opinion, Int. - Internal Value
- ------------------------------------------------------------------------------------------------------------------------------------
*** How to deterime the cap rate is agreed upon by Underwriter and special
services - to be provided by a third party
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
S4 P38 P25 P10 P11 P58 P54 P55 P81 P74
- ------------------------------------------------------------------------------------------------------------------------------------
(d) (e)=a+b+c+d (f)=P38/P81
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Other Value
Advances Current Current using NOI
Prospectus (Taxes & Total Monthly Interest Maturity LTM NOI Cap Rate & Cap Valuation
ID Escrow) Exposure P&I Rate Date Date LTM NOI LTM DSCR Assigned Rate Date
- ------------------------------------------------------------------------------------------------------------------------------------
90 + DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
60 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
30 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Current & at Special Servicer
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
S4 P75 P35 P77 P79 P42 P82 P76
- -----------------------------------------------------------------------------------------------------------------------------
(g)=(.92*f)-e (h)=(g/e)
- -----------------------------------------------------------------------------------------------------------------------------
APPRAISAL TOTAL
BPO OR LOSS USING ESTIMATED APPRAISAL FCL EXPECTED
PROSPECTUS INTERNAL 92% APPR. RECOVERY REDUCTION TRANSFER RESOLUTION START FCL SALE WORKOUT
ID VALUE** OR BPO (F) % REALIZED DATE DATE DATE DATE STRATEGY COMMENTS
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------
90 + DAYS DELINQUENT
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
60 DAYS DELINQUENT
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
30 DAYS DELINQUENT
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
Current & at Special Servicer
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------
FCL - Foreclosure
- ----------------------------------------------------------------------------------------------------------------------------
LTM - Latest 12 Months either Last Annual or Trailing 12 m
- ----------------------------------------------------------------------------------------------------------------------------
* Workout Strategy should match the CSSA Loan file using abr etc...
- ----------------------------------------------------------------------------------------------------------------------------
It is possible to combine the status codes if the loan is goi
- ----------------------------------------------------------------------------------------------------------------------------
** App - Appraisal, BPO - Broker opinion, Int. - Internal Va
- ----------------------------------------------------------------------------------------------------------------------------
*** How to deterime the cap rate is agreed upon by Underwriter and special
services - to be provided by a third party
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
P-1
<PAGE>
EXHIBIT Q
HISTORICAL LOAN MODIFICATION REPORT
AS OF _________________
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
S4 S57 S58 P49 P48 P7* P7* P50* P50* P25*
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
BALANCE BALANCE AT
WHEN THE
MOD / SENT TO EFFECTIVE # MTHS
PROSPECTUS EXTENTION EFFECT SPECIAL DATE OF OLD FOR RATE NEW OLD
ID CITY STATE FLAG DATE SERVICER REHABILITATION RATE CHANGE RATE P&I
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
THIS REPORT IS HISTORICAL
- ---------------------------------------------------------------------------------------------------------------------------
Information is as of modification. Each line it should not change in the future. Only new modifications should be added.
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
===========================================================================================================================
TOTAL FOR ALL LOANS:
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL FOR LOANS IN CURRENT MONTH:
- ---------------------------------------------------------------------------------------------------------------------------
# OF LOANS $ BALANCE
- ---------------------------------------------------------------------------------------------------------------------------
MODIFICATIONS:
- ---------------------------------------------------------------------------------------------------------------------------
MATURITY DATE EXTENTIONS:
- ---------------------------------------------------------------------------------------------------------------------------
TOTAL:
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
* The information in these columns is from a particular point in time and should not change on this report once assigned.
- ---------------------------------------------------------------------------------------------------------------------------
(1) Actual principal loss taken by bonds
- ---------------------------------------------------------------------------------------------------------------------------
(2) Expected future loss due to a rate reduction. This is just an estimate calculated at the time of the modification.
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
S4 P25* P11* P11* P47
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
(2) EST.
FUTURE
TOTAL # INTEREST
MTHS (1) LOSS TO
FOR REALIZED TRUST $
PROSPECTUS NEW OLD NEW CHANGE LOSS TO (RATE
ID P&I MATURITY MATURITY OF MOD TRUST $ REDUCTION) COMMENT
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
==========================================================================================================
TOTAL FOR ALL LOANS:
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
TOTAL FOR LOANS IN CURRENT MONTH:
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
MODIFICATIONS:
- ----------------------------------------------------------------------------------------------------------
MATURITY DATE EXTENTIONS:
- ----------------------------------------------------------------------------------------------------------
TOTAL:
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
</TABLE>
Q-1
<PAGE>
EXHIBIT R
HISTORICAL LOSS ESTIMATE REPORT (REO-SOLD or DISCOUNTED PAYOFF)
as of ______________________
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 P45/P7 P75 P45 P7 P37 P39+P38
- -----------------------------------------------------------------------------------------------------------------------------------
(c)=b/a (a) (b) (d) (e) (f) (g)
- -----------------------------------------------------------------------------------------------------------------------------------
LATEST
APPRAISAL
SHORT NAME % OR EFFECT NET AMT
PROSPECTUS (WHEN PROPERTY RECEIVED BROKERS DATE OF SALES RECEIVED SCHEDULED TOTAL P&I TOTAL
ID APPROPRIATE) TYPE CITY STATE FROM SALE OPINION SALE PRICE FROM SALE BALANCE ADVANCED EXPENSE
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
THIS REPORT IS HISTORICAL
- -----------------------------------------------------------------------------------------------------------------------------------
All information is from the liquidation date and does not need to be updated.
- -----------------------------------------------------------------------------------------------------------------------------------
===================================================================================================================================
TOTAL ALL LOANS:
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
CURRENT MONTH ONLY:
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
S4
- ---------------------------------------------------------------------------------------------------------
(h) (i)=d-(f+g+h) (k)=i-e (m) (n)=k+m (o)=n/e
- ---------------------------------------------------------------------------------------------------------
DATE MINOR
LOSS ADJ TOTAL LOSS LOSS % OF
PROSPECTUS SERVICING ACTUAL LOSSES PASSED MINOR ADJ PASSED WITH SCHEDULED
ID FEES EXPENSE NET PROCEEDS PASSED THRU THRU TO TRUST THRU ADJUSTMENT BALANCE
=========================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
THIS REPORT IS HISTORICAL
- ---------------------------------------------------------------------------------------------------------
All information is from the liquidation date and does not need to be updated.
- ---------------------------------------------------------------------------------------------------------
=========================================================================================================
Total all Loans:
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
Current Month Only:
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
</TABLE>
R-1
<PAGE>
EXHIBIT S
Form of NOI ADJUSTMENT WORKSHEET for "year"
as of ____________________
<TABLE>
<S> <C> <C> <C> <C> <C>
PROPERTY OVERVIEW
-------------
LB Control Number
-------------------------
Current Balance/Paid to Date
--------------------------------------------------------------------------------------------
Property Name
--------------------------------------------------------------------------------------------
Property Type
--------------------------------------------------------------------------------------------
Property Address, City, State
--------------------------------------------------------------------------------------------
Net Rentable Square Feet
-------------------------
Year Built/Year Renovated
--------------------------------------------
Year of Operations BORROWER ADJUSTMENT NORMALIZED
--------------------------------------------
Occupancy Rate *
--------------------------------------------
Average Rental Rate
--------------------------------------------
* OCCUPANCY RATES ARE YEAR END OR THE ENDING
DATE OF THE FINANCIAL STATEMENT FOR THE
PERIOD.
INCOME:
Number of Mos.Annualized "Year"
-------------------------------------------------------------------
Period Ended Borrower Adjustment Normalized
Statement Classification Actual
-------------------------------------------------------------------
Rental Income (Category 1)
-------------------------------------------------------------------
Rental Income (Category 2)
-------------------------------------------------------------------
Rental Income (Category 3)
-------------------------------------------------------------------
Pass Throughs/Escalations
-------------------------------------------------------------------
Other Income
-------------------------------------------------------------------
-------------------------------------------------------------------
EFFECTIVE GROSS INCOME $0.00 $0.00 $0.00
-------------------------------------------------------------------
Normalized - Full year financial statements that have been reviewed
by the underwriter or Servicer
OPERATING EXPENSES:
-------------------------------------------------------------------
Real Estate Taxes
-------------------------------------------------------------------
Property Insurance
-------------------------------------------------------------------
Utilities
-------------------------------------------------------------------
General & Administration
-------------------------------------------------------------------
Repairs and Maintenance
-------------------------------------------------------------------
Management Fees
-------------------------------------------------------------------
Payroll & Benefits Expense
-------------------------------------------------------------------
Advertising & Marketing
-------------------------------------------------------------------
Professional Fees
-------------------------------------------------------------------
Other Expenses
-------------------------------------------------------------------
Ground Rent
-------------------------------------------------------------------
TOTAL OPERATING EXPENSES $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
OPERATING EXPENSE RATIO
-------------------------------------------------------------------
-------------------------------------------------------------------
NET OPERATING INCOME $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
Leasing Commissions
-------------------------------------------------------------------
Tenant Improvements
-------------------------------------------------------------------
Replacement Reserve
-------------------------------------------------------------------
TOTAL CAPITAL ITEMS $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
N.O.I. AFTER CAPITAL ITEMS $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
DEBT SERVICE (PER SERVICER) $0.00 $0.00 $0.00
-------------------------------------------------------------------
CASH FLOW AFTER DEBT SERVICE $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
(1)DSCR: (NOI/DEBT SERVICE)
-------------------------------------------------------------------
-------------------------------------------------------------------
DSCR: (AFTER RESERVES\CAP EXP.)
-------------------------------------------------------------------
-------------------------------------------------------------------
SOURCE OF FINANCIAL DATA:
-------------------------------------------------------------------
(ie. operating statements, financial statements, tax return, other)
</TABLE>
NOTES AND ASSUMPTIONS:
================================================================================
This report should be completed by the Servicer for any "Normalization" of the
Borrowers numbers.
The "Normalized" column is used in the Operating Statement Analysis Report.
This report may vary depending on the property type and because of the way
information may vary in each borrowers statement.
INCOME: COMMENTS
EXPENSE: COMMENTS
CAPITAL ITEMS: COMMENTS
(1) Used in the Comparative Financial Status Report
S-1
<PAGE>
EXHIBIT T
Form of OPERATING STATEMENT ANALYSIS REPORT
as of ____________________
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
PROPERTY OVERVIEW
--------------
LB Control Number
--------------
-------------------------
Current Balance/Paid to Date
-----------------------------------------------------------------------------------------------
Property Name
-----------------------------------------------------------------------------------------------
Property Type
-----------------------------------------------------------------------------------------------
Property Address, City, State
-----------------------------------------------------------------------------------------------
Net Rentable Square Feet
-------------------------
Year Built/Year Renovated
-----------------------------------------------------------------
Year of Operations UNDERWRITING 1994 1995 1996 TRAILING
-----------------------------------------------------------------
Occupancy Rate *
-----------------------------------------------------------------
Average Rental Rate
-----------------------------------------------------------------
* OCCUPANCY RATES ARE YEAR END OR THE ENDING DATE OF THE FINANCIAL STATEMENT FOR THE PERIOD.
INCOME: NO. OF MOS.
--------------
Number of Mos. PRIOR YEAR CURRENT YR.
------------------------------------------------------------------------------------------
Period Ended UNDERWRITING 1994 1995 1996 97 TRAILING** 1996-BASE 1996-1995
--------------
Statement Classification BASE LINE NORMALIZED NORMALIZED NORMALIZED AS OF / /97 VARIANCE VARIANCE
------------------------------------------------------------------------------------------
Rental Income (Category 1)
------------------------------------------------------------------------------------------
Rental Income (Category 2)
------------------------------------------------------------------------------------------
Rental Income (Category 3)
------------------------------------------------------------------------------------------
Pass Through/Escalations
------------------------------------------------------------------------------------------
Other Income
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
EFFECTIVE GROSS INCOME $0.00 $0.00 $0.00 $0.00 $0.00 % %
------------------------------------------------------------------------------------------
Normalized - Full year Financial statements that have been reviewed by the underwriter or
Servicer
** Servicer will not be expected to "Normalize" these YTD numbers.
OPERATING EXPENSES:
------------------------------------------------------------------------------------------
Real Estate Taxes
------------------------------------------------------------------------------------------
Property Insurance
------------------------------------------------------------------------------------------
Utilities
------------------------------------------------------------------------------------------
General & Administration
------------------------------------------------------------------------------------------
Repairs and Maintenance
------------------------------------------------------------------------------------------
Management Fees
------------------------------------------------------------------------------------------
Payroll & Benefits Expense
------------------------------------------------------------------------------------------
Advertising & Marketing
------------------------------------------------------------------------------------------
Professional Fees
------------------------------------------------------------------------------------------
Other Expenses
------------------------------------------------------------------------------------------
Ground Rent
------------------------------------------------------------------------------------------
TOTAL OPERATING EXPENSES $0.00 $0.00 $0.00 $0.00 $0.00 % %
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
OPERATING EXPENSE RATIO
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
NET OPERATING INCOME $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Leasing Commissions
------------------------------------------------------------------------------------------
Tenant Improvements
------------------------------------------------------------------------------------------
Replacement Reserve
------------------------------------------------------------------------------------------
TOTAL CAPITAL ITEMS $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
N.O.I. AFTER CAPITAL ITEMS $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
DEBT SERVICE (PER SERVICER) $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
CASH FLOW AFTER DEBT SERVICE $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
(1) DSCR: (NOI/DEBT SERVICE)
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
DSCR: (AFTER RESERVES\CAP EXP.)
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
SOURCE OF FINANCIAL DATA:
------------------------------------------------------------------------------------------
(ie. operating statements, financial statements, tax return, other)
Notes and Assumptions:
===========================================================================================================================
</TABLE>
The years shown above will roll always showing a three year history. 1996 is the
current year financials; 1995 is the prior year financials.
This report may vary depending on the property type and because of the way
information may vary in each borrowers statement.
Rental Income need to be broken down, differently whenever possible for each
property type as follows: Retail: 1) Base Rent 2) Percentage rents on cashflow
Hotel: 1) Room Revenue 2) Food/Beverage Nursing Home: 1) Private 2) Medicaid
3) Medicare
INCOME: COMMENT
EXPENSE: COMMENT
CAPITAL ITEMS: COMMENT
(1) Used in the Comparative Financial Status Report
T-1
<PAGE>
EXHIBIT U
Form of Loan Payoff Notification Report
U-1
<PAGE>
<TABLE>
<CAPTION>
LOAN PAYMENT NOTIFICATION REPORT
as of_____________
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------|----------------------------------------
S4 S55 S61 S58 P7 P8 P10 P11 P54 | SERVICER ESTIMATED INFORMATION
- -------------------------------------------------------------------------------------------|----------------------------------------
PROSPECTUS SHORT NAME PROPERTY SCHEDULED PAID CURRENT MATURITY LTM | YIELD EXPECTED EXPECTED
ID (WHEN TYPE STATE LOAN THRU INTEREST DATE DSCR | MAINTENANCE PAYMENT DISTRIBUTION
APPROPRIATE) BALANCE DATE RATE | DATE DATE
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
Scheduled Payments |
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
Unscheduled Payments |
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
Total: $ |
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
THE BORROWER HAS ONLY REQUESTED THE INFORMATION TO PAY-OFF. THIS DOES NOT INDICATE A DEFINITE PAYMENT.
</TABLE>
U-2
<PAGE>
EXHIBIT V
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY PERIODIC" UPDATE FILE
(DATA RECORD LAYOUT)
<TABLE>
<CAPTION>
FIELD FORMAT CSSA
FIELD NAME NUMBER TYPE EXAMPLE DESCRIPTION/COMMENTS LOAN
- ---------- ------ ---- ------- -------------------- ----
<S> <C> <C> <C> <C> <C>
Transaction ID 1 AN XXX97001 S1, P1
Loan ID 2 AN XXX9701A S3, P3
Prospectus Loan ID 3 AN 00000000012345 From Offering Document S4, P4
Property ID 4 AN 123 Should contain Prospectus ID and
property identifier, e.g., 1001-1, 1000-2
Distribution Date 5 AN Text P5
Property Status 6 AN 1 1=FCL, 2=Defeased, 4=Partial Release
Current Allocated Percentage 7 Numeric 50
Current Allocated Loan Amount 8 Numeric 5,900,000 P7
Other Escrow/Reserve Balances 9 S77
Most Recent Appraisal Date 10 AN YYYYMMDD P74
Most Recent Appraisal Value 11 Numeric P75
Date Asset Is Expected to Be
Resolved 12 AN YYYYMMDD Could be different dates for different
properties if foreclosing P79
Foreclosure Date 13 AN YYYYMMDD P42
REO Date 14 AN YYYYMMDD P43
Occupancy % 15 Numeric 100 Map to "Most Recent Fiscal YTD Phys. Occ."
in CSSA 100. Kept in Fin File? P71
Date Lease Rollover Review 16 AN YYYYMMDD
%/# Sq. Feet expiring 1-12 months 17 Numeric
%/# Sq. Feet expiring 13-24 months 18 Numeric
%/# Sq. Feet expiring 25-36 months 19 Numeric
%/# Sq. Feet expiring 37-48 months 20 Numeric
%/# Sq. Feet expiring 49-60 months 21 Numeric
Largest Tenant 22 AN Text Not necessary for multifamily
Square Feet of Largest Tenant 23 Numeric 15000
Date of Last Inspection 24 AN YYYYMMDD
Preceding FY Financial As of Date 25 AN YYYYMMDD P58
Preceding Fiscal Year Revenue 26 Numeric P52
Preceding Fiscal Year Expenses 27 Numeric P53
Preceding Fiscal Year NOI 28 Numeric P54
</TABLE>
"PERIODIC UPDATE FILE" - AVAILABLE MONTHLY OR AS PER REQUIRED BY DOCUMENTS.
Page 1 of 1
V-1
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY PERIODIC" UPDATE FILE
(DATA RECORD LAYOUT)
<TABLE>
<CAPTION>
FIELD FORMAT CSSA
FIELD NAME NUMBER TYPE EXAMPLE DESCRIPTION/COMMENTS LOAN
- ---------- ------ ---- ------- -------------------- ----
<S> <C> <C> <C> <C> <C>
Preceding Fiscal Year Debt
Service Amt 29 Numeric P55
Preceding Fiscal Year DSCR 30 Numeric P56
Preceding Fiscal Year Physical
Occupancy 31 Numeric P57
Sec Preceding FY Financial As
of Date 32 AN YYYYMMDD P65
Second Preceding FY Revenue 33 Numeric P59
Second Preceding FY Expenses 34 Numeric P60
Second Preceding FY NOI 35 Numeric P61
Second Preceding FY Debt Service 36 Numeric P62
Second Preceding FY DSCR 37 Numeric P63
Sec Preceding FY Physical Occupancy 38 Numeric P64
Trailing Start Date 39 AN YYYYMMDD Can be Year to Date if Trailing Information is
not available P65
Trailing End Date 40 AN YYYYMMDD
Trailing FY Revenue 41 Numeric P59
Trailing FY Expenses 42 Numeric P60
Trailing FY NOI 43 Numeric P61
Trailing FY Debt Service 44 Numeric P62
Trailing FY DSCR 45 Numeric P63
Trailing Physical Occupancy 46 Numeric P64
</TABLE>
"PERIODIC UPDATE FILE" - AVAILABLE MONTHLY OR AS PER REQUIRED BY DOCUMENTS.
Page 2 of 2
V-2
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY PERIODIC" UPDATE FILE
(DATA RECORD LAYOUT)
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ---------- ----------------------------------------------
Transaction ID Same as 100.1
Loan ID Same as 100.1
Prospectus Loan ID Same as 100.1
Property ID
Distribution Date Same as 100.1
Property Status
Current Allocated Percentage
Current Allocated Loan Amount Roll-up to Current Ending SPB (P7)
Other Escrow/Reserve Balances If any property populated, then S-77=Y
Most Recent Appraisal Date If Multi-Prop, and all same then populate
P74 with date, otherwise, "Various"
Most Recent Appraisal Value Roll-up to 100.1 if populated
Date Asset is Expected to
Be Resolved If Multi-Prop, latest date from affiliated
properties for P79.
Foreclosure Date If Multi-Prop, and all same then populate
P42 with date, otherwise, "Various"
REO Date If Multi-Prop, and all same then populate
P43 with date, otherwise, "Various"
Occupancy % Weighted Average based on CALAmt and
ALAmt.@Sec.
Date Lease Rollover Review
%/# Sq. Feet expiring 1-12 months
%/# Sq. Feet expiring 13-24 months
%/# Sq. Feet expiring 25-36 months
%/# Sq. Feet expiring 37-48 months
%/# Sq. Feet expiring 49-60 months
Largest Tenant
Square Feet of Largest Tenant
Date of Last Inspection
Preceding FY Financial As of Date If Multi-Prop, and all same then populate
P58 with date, otherwise, "Various".
Preceding Fiscal Year Revenue Roll-up to 100.1 if populated
Preceding Fiscal Year Expenses Roll-up to 100.1 if populated
Preceding Fiscal Year NOI Roll-up to 100.1 if populated
"PERIODIC UPDATE FILE" - AVAILABLE MONTHLY OR AS PER REQUIRED BY DOCUMENTS.
Page 3 of 3
V-3
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY PERIODIC" UPDATE FILE
(DATA RECORD LAYOUT)
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ---------- ----------------------------------------------
Preceding Fiscal Year Debt
Service Amt. Weighted Average based on ALAmt@Sec.
Preceding Fiscal Year DSCR Weighted Average based on ALAmt@Sec.
Preceding Fiscal Year Physical
Occupancy Weighted Average based on ALAmt@Sec.
Sec Preceding FY Financial
As of Date If Multi-Prop, and all same then populate P65
with date, otherwise, "Various".
Second Preceding FY Revenue Roll-up to 100.1 if populated
Second Preceding FY Expenses Roll-up to 100.1 if populated
Second Preceding FY NOI Roll-up to 100.1 if populated
Second Preceding FY Debt Service Weighted Average based on ALAmt@Sec.
Second Preceding FY DSCR Weighted Average based on ALAmt@Sec.
Second Preceding FY Physical
Occupancy Weighted Average based on ALAmt@Sec.
Trailing Start Date If Multi-Prop, and all same then populate P65
with date, otherwise, "Various".
Trailing End Date
Trailing FY Revenue Roll-up to 100.1 if populated
Trailing FY Expenses Roll-up to 100.1 if populated
Trailing FY NOI Roll-up to 100.1 if populated
Trailing FY Debt Service Weighted Average based on ALAmt@Sec.
Trailing FY DSCR Weighted Average based on ALAmt@Sec.
Trailing FY Physical Occupancy Weighted Average based on ALAmt@Sec.
"PERIODIC UPDATE FILE" - AVAILABLE MONTHLY OR AS PER REQUIRED BY DOCUMENTS.
Page 4 of 4
V-4
<PAGE>
EXHIBIT W-1
FORM OF CERTIFICATEHOLDER CONFIRMATION CERTIFICATE
REQUEST BY BENEFICIAL HOLDER
[Date]
Norwest Bank Minnesota, National Association
Three New York Plaza
New York, New York 10004
Attention: Corporate Trust Services (CMBS)
Re: Merrill Lynch Mortgage Investors, Inc., Series 1998-C2
In accordance with Section 3.15 of the Pooling and Servicing Agreement.
dated as of March 1, 1998 (the "Pooling and Servicing Agreement"), among Merrill
Lynch Mortgage Investors, Inc. as depositor (the "Depositor"), First Union
National Bank, as master servicer, CRIIMI MAE Services Limited Partnership, as
special servicer, and Norwest Bank Minnesota, National Association as trustee
(in such capacity, the "Trustee"), with respect to the Merrill Lynch Mortgage
Investors, Inc. Mortgage Pass-Through Certificates, Series 1998-C2 (the
"Certificates"), the undersigned hereby certifies and agrees as follows:
1. The undersigned is a beneficial owner of the Class ____
Certificates.
2. The undersigned is requesting the information identified on the
schedule attached hereto pursuant to Section 3.15 of the Pooling
and Servicing Agreement (the "Information").
3. In consideration of the Trustee's disclosure to the undersigned
of the Information, the undersigned will keep the Information
confidential (except from such outside persons as are assisting
it in making the evaluation described in paragraph 2), and such
Information will not, without the prior written consent of the
Trustee, be disclosed by the undersigned or by its officers,
directors, partners employees, agents or representatives
(collectively, the "Representatives") in any manner whatsoever,
in whole or in part; provided that the undersigned may provide
all or any part of the Information to any other person or entity
that holds or is contemplating the purchase of any Certificate or
interest therein, but only if such person or entity confirms in
writing such ownership interest or prospective ownership interest
and agrees to keep it confidential.
W-1
<PAGE>
4. The undersigned will not use or disclose the Information in any
manner which could result in a violation of any provision of the
Securities Act of 1933, as amended, (the "Securities Act"), or
the Securities Exchange Act of 1934, as amended, or would require
registration of any Certificate pursuant to Section 5 of the
Securities Act.
5. The undersigned shall be fully liable for any breach of this
agreement by itself or any of its Representatives and shall
indemnify the Depositor, the Trustee and the Trust for any loss,
liability or expense incurred thereby with respect to any such
breach by the undersigned or any of its Representatives.
IN WITNESS WHEREOF, the undersigned has caused its name to be signed hereto
by its duly authorized officer, as of the day and year written above.
[BENEFICIAL HOLDER OF A CERTIFICATE]
By:______________________________________
Name:
Title:
W-2
<PAGE>
EXHIBIT W-2
FORM PROSPECTIVE PURCHASER CERTIFICATE
[Date]
[TRUSTEE]
Re: Merrill Lynch Mortgage Investors, Inc., Mortgage Pass-Through
Certificates, Series 1998-C2 (the "Certificates").
In accordance with Section 3.15 of the Pooling and Servicing Agreement,
dated as of March 1, 1998 (the "Pooling and Servicing Agreement"), among Merrill
Lynch Mortgage Investors, Inc., as depositor (the "Depositor"), First Union
National Bank as master servicer, CRIIMI MAE Services Limited Partnership, as
special servicer, and Norwest Bank Minnesota, National Association as trustee
(in such capacity, the "Trustee"), with respect to the Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series 1998-C2 (the
"Certificates"), the undersigned hereby certifies and agrees as follows:
1. The undersigned is contemplating an investment in the Class
__ Certificates.
2. The undersigned is requesting the information identified on
the schedule attached hereto pursuant to Section 3.15 of the
Pooling and Servicing Agreement (the "Information") for use
in evaluating such possible investment.
3. In consideration of the Trustee's disclosure to the
undersigned of the Information, the undersigned will keep
the Information confidential (except from such outside
persons as are assisting it in making the investment
decision described in paragraphs 1 and 2), and such
Information will not, without the prior written consent of
the Trustee, be disclosed by the undersigned or by its
officers, directors, partners employees, agents or
representatives (collectively, the "Representatives") in any
manner whatsoever, in whole or in part.
4. The undersigned will not use or disclose the Information in
any manner which could result in a violation of any
provision of the Securities Act of 1933, as amended (the
"Securities Act"), or the Securities Exchange Act of 1934,
as amended, or would require registration of any Certificate
pursuant to Section 5 of the Securities Act.
<PAGE>
5. The undersigned shall be fully liable for any breach of this
agreement by itself or any of its Representatives and shall
indemnify the Depositor, the Trustee and the Trust for any
loss, liability or expense incurred thereby with respect to
any such breach by the undersigned or any of its
Representatives.
IN WITNESS WHEREOF, the undersigned has caused its name to be signed hereto
by its duly authorized officer, as of the day and year written above.
[PROSPECTIVE PURCHASER]
By:________________________________
Name:
Title:
-2-
<PAGE>
EXHIBIT X
FORM OF LOST NOTE AFFIDAVIT
STATE OF NEW YORK )
: SS.:
COUNTY OF NEW YORK )
_______________, ______________, being duly sworn, deposes and says:
1. that he is an authorized signatory of [Insert Name of Seller] ("DAIWA");
2. that DAIWA is the owner and holder of a mortgage loan in the original
principal amount of $________ secured by a mortgage (the "Mortgage") on the
premises known as _____________________ located in _________;
3. (a) that DAIWA, after having conducted a diligent investigation of its
records and files, has been unable to locate the following original note and
believes that said original Note has been lost, misfiled, misplaced or destroyed
due to a clerical error:
a Note in the original sum of $________ made by ________, to
[Name of Payee], under date of ________ (the "Note");
4. that the note is now owned and held by DAIWA,
5. that the Note has not been paid off, satisfied, assigned, transferred,
encumbered, endorsed, pledged, hypothecated, or otherwise disposed of and that
the original Note has been either lost, misfiled, misplaced or destroyed;
6. that no other person, firm, corporation or other entity has any right,
title, interest or claim in the Note except DAIWA;
7. upon assignment of the Note by DAIWA to Merrill Lynch Mortgage
Investors, Inc. (the "Depositor") and subsequent assignment by Depositor to the
Norwest Bank Minnesota National Association solely in its capacity of trustee
for the benefit of the Holders of Merrill Lynch Mortgage Investors, Inc.
Mortgage Pass-Through Certificate, Series 1998-C2 (the "Trustee") (which
assignment may, at the discretion of the Depositor, be made directly by DAIWA to
the Trustee) DAIWA covenants and agrees (a) promptly to deliver to the Trustee
the original Note if it is subsequently found, and (b) to indemnity and hold
harmless the Trustee and its successors and assigns from and against any and all
costs, expenses and monetary losses arising as a result of
<PAGE>
DAIWA's or the Depositor's failure to deliver said original Note to the Trustee.
[INSERT NAME OF SELLER]
By:_______________________
Authorized Signatory
Sworn to before me this ___ day of ___________.
-2-
1998-C2
Merrill Lynch
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement, dated as of March 1, 1998 (the
"Agreement"), is between Merrill Lynch Mortgage Investors, Inc., a Delaware
corporation (the "Company"), and Merrill Lynch Mortgage Capital, Inc. (the
"Mortgage Loan Seller"). The Mortgage Loan Seller agrees to sell, and the
Company agrees to purchase, the mortgage loans (the "Mortgage Loans") described
in, and set forth in, the Mortgage Loan Schedule attached as Exhibit A to this
Agreement (the "Mortgage Loan Schedule"). The Company intends to deposit the
Mortgage Loans and other assets into a trust (the "Trust") and cause the
creation of a series of certificates to be known as Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series 1998-C2 (the
"Certificates"), evidencing beneficial ownership interests in the Mortgage Loans
and other assets (including, without limitation, other mortgage loans), under a
Pooling and Servicing Agreement, to be dated as of March 1, 1998 (the "Pooling
and Servicing Agreement"), among the Company, as depositor, First Union National
Bank, as master servicer (the "Servicer"), CRIIMI MAE Services Limited
Partnership, as special servicer (the "Special Servicer"), and Norwest Bank
Minnesota, National Association, as trustee (the "Trustee"). Capitalized terms
used but not otherwise defined herein shall have the respective meanings given
to them in the Pooling and Servicing Agreement without giving effect to any
amendment thereto unless the Mortgage Loan Seller has given its consent to such
amendment in writing and signed by a duly authorized officer of the Mortgage
Loan Seller.
1. Purchase Price; Purchase and Sale. The purchase price (the "Purchase
Price") for the Mortgage Loans shall consist of a cash amount equal to (i) 100%
of the outstanding principal balance of the Mortgage Loans as of the Cut-Off
Date plus (ii) interest accrued on the Mortgage Loans at the related Mortgage
Rate up to but excluding the Closing Date. The Purchase Price amount shall be
payable by the Company to the Mortgage Loan Seller on March 27, 1998 or such
other date as shall be mutually acceptable to the parties hereto (the "Closing
Date") in immediately available funds. The closing for the purchase and sale of
the Mortgage Loans shall take place at the offices of Willkie Farr & Gallagher,
153 East 53rd Street, New York, New York 10022, at 10:00 a.m. (New York time),
on the Closing Date.
On the Closing Date, the Mortgage Loan Seller shall sell, transfer, assign,
set over and convey to the Company, without recourse, and the Company shall
purchase, all the right, title and interest of the Mortgage Loan Seller in and
to the Mortgage Loans, including all interest and principal due on or with
respect to the Mortgage Loans after the Cut-off Date, together with all of the
Mortgage Loan Seller's right, title and interest in and to the proceeds of any
related title, hazard, primary mortgage or other insurance policies. All
scheduled payments of interest and principal due before the Cut-Off Date
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but collected on or after the Cut-Off Date, and recoveries of interest and
principal collected before the Cut-Off Date, shall belong to, and be promptly
remitted to the Mortgage Loan Seller. The Company hereby directs the Mortgage
Loan Seller, and the Mortgage Loan Seller hereby agrees, to deliver to each of
the Trustee, the Master Servicer and the Special Servicer all documents,
instruments and agreements required to be delivered by the Company to the
Trustee, the Master Servicer and the Special Servicer under Section 2.01 of the
Pooling and Servicing Agreement, and meeting all the requirements of such
Section 2.01 and such other documents, instruments and agreements as the Company
or the Trustee, the Master Servicer and the Special Servicer shall reasonably
request. The Mortgage Loan Schedule may be amended to reflect the actual
Mortgage Loans.
2. Representations and Warranties. (a) The Mortgage Loan Seller hereby
represents and warrants to the Company as of the date hereof and as of Closing
Date that:
(i) The Mortgage Loan Seller is a Delaware corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware, with the necessary corporate power and authority to own its
assets and conduct its business as now being conducted, is duly qualified
as a foreign corporation in good standing in all jurisdictions in which the
ownership or lease of its property or the conduct of its business requires
such qualification, except where the failure to be so qualified would not
have a material adverse effect on the value of the Mortgage Loans and the
ability of the Mortgage Loan Seller to perform its obligations hereunder,
and the Mortgage Loan Seller has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement by it,
and has the necessary corporate power and authority to execute, deliver and
perform this Agreement and all the transactions contemplated hereby,
including, but not limited to, the power and authority to sell, assign,
transfer, set over and convey the Mortgage Loans in accordance with this
Agreement;
(ii) This Agreement has been duly authorized, executed and delivered by the
Mortgage Loan Seller and assuming the due authorization, execution and
delivery by the Company, will constitute a legal, valid and binding
obligation of the Mortgage Loan Seller, enforceable against the Mortgage
Loan Seller in accordance with the terms of this Agreement, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the
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enforcement of creditors' rights generally, and by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law), 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 Mortgage Loan
Seller and the performance of its obligations hereunder (1) will not
conflict with any provision of any law or regulation to which the Mortgage
Loan Seller is subject, or conflict with, result in a breach of or
constitute a default under any of the terms, conditions or provisions of
any of the Mortgage Loan Seller's organizational documents or any agreement
or instrument to which the Mortgage Loan Seller is a party or by which it
is bound, or any order or decree applicable to the Mortgage Loan Seller, or
result in the creation or imposition of any lien on any of the Mortgage
Loan Seller's assets or property, in each case which would materially and
adversely affect the ability of the Mortgage Loan Seller to carry out the
transactions contemplated by this Agreement; and (2) does not require the
consent of any third party or such consent has been obtained.
(iv) There is no action, suit, proceeding or investigation pending or, to
the knowledge of the Mortgage Loan Seller, threatened against the Mortgage
Loan Seller in any court or by or before any other governmental agency or
instrumentality which, in the Mortgage Loan Seller's good faith and
reasonable judgment, would materially and adversely affect the validity of
the Mortgage Loans or the ability of the Mortgage Loan Seller to enter
into, or which would be likely to impair materially and adversely the
ability of the Mortgage Loan Seller to carry out the transactions
contemplated by, this Agreement;
(v) The Mortgage Loan Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have
consequences that, in the Mortgage Loan Seller's good faith and reasonable
judgment, would materially and adversely affect the condition (financial or
other) or operations
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of the Mortgage Loan Seller or its properties or might have consequences
that would materially and adversely affect its performance hereunder;
(vi) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Mortgage Loan Seller of or compliance by the Mortgage
Loan Seller with this Agreement or the consummation of the transactions
contemplated by this Agreement, other than those which have been obtained
by the Mortgage Loan Seller;
(vii) The transfer, assignment and conveyance of the Mortgage Loans by the
Mortgage Loan Seller to the Company is not subject to bulk transfer laws or
any similar statutory provisions in effect in any applicable jurisdiction;
and
(viii) Under generally accepted accounting principles ("GAAP") and for
federal income tax purposes, the Mortgage Loan Seller will report the
transfer of the Mortgage Loans to the Company as a sale of the Mortgage
Loans to the Company. The consideration received by the Mortgage Loan
Seller upon the sale of the Mortgage Loans to the Company will constitute
reasonably equivalent value and fair consideration for the Mortgage Loans.
The Mortgage Loan Seller will be solvent at all relevant times prior to,
and will not be rendered insolvent by, the sale of the Mortgage Loans to
the Company. The Mortgage Loan Seller is not selling the Mortgage Loans to
the Company with any intent to hinder, delay or defraud any of the
creditors of the Mortgage Loan Seller.
(b) The Mortgage Loan Seller hereby makes the representations and
warranties contained in Schedule I, Schedule II and Schedule III with respect to
each Mortgage Loan as of the date specified therein or, if no such date is
specified, as of the Closing Date.
3. Notice of Breach; Cure and Repurchase.
(a) Pursuant to the Pooling and Servicing Agreement, the Mortgage Loan
Seller and the Company shall be given notice of any Breach or Document Defect
that materially and adversely affects the value of such Mortgage Loan or the
interests of the holders of the Certificates therein.
(b) Upon notice pursuant to Section 3(a) herein, the Mortgage Loan Seller
shall, not later than 90 days from the Mortgage Loan Seller's receipt of notice
of such Breach or
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Document Defect (or, in the case of a Document Defect or Breach relating to a
Mortgage Loan not being a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Internal Revenue Code of 1986, as amended (a "Qualified
Mortgage"), not later than 90 days of any party to this Agreement or to the
Pooling and Servicing Agreement discovering such Document Defect or Breach), if
such Breach or Document Defect shall materially and adversely affect the value
of such Mortgage Loan or the interests of the holders of the Certificates
therein, cure such Document Defect or Breach, as the case may be, in all
material respects or, if such Document Defect or Breach (other than omissions
solely due to a document not having been returned by the related recording
office) cannot be cured within the periods hereinafter set forth, repurchase the
affected Mortgage Loan at the applicable Repurchase Price (as defined below);
provided, however, that if such Document Defect or Breach is capable of being
cured but not within such 90-day period, such Document Defect or Breach does not
relate to any Mortgage Loan not being treated as a Qualified Mortgage, and the
Mortgage Loan Seller has commenced and is diligently proceeding with the cure of
such Document Defect or Breach within such 90-day period, the Mortgage Loan
Seller shall (A) with respect to any Breach, have an additional 90-day period to
complete such cure (or failing such cure, to complete such repurchase) and (B)
with respect to any Document Defect, have additional 90-day periods up to but
not exceeding the second anniversary of the Closing Date to complete such cure
(or failing such cure, to complete such repurchase); provided, further, that
with respect to each additional 90-day period, the 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 or additional 90-day period, as applicable, and what actions the
Mortgage Loan Seller is pursuing in connection with the cure thereof and stating
that the Mortgage Loan Seller anticipates that such Document Defect or Breach
will be cured within such additional 90-day period. If the affected Mortgage
Loan is to be repurchased, Mortgage Loan Seller shall remit the Repurchase Price
in immediately available funds to the Trustee. The delivery of a binding
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.
The "Repurchase Price" with respect to any Mortgage Loan or REO Loan to be
repurchased pursuant to this Agreement and Section 2.03 of the Pooling and
Servicing Agreement, shall have the meaning given to the term "Purchase Price"
in the Pooling and Servicing Agreement without giving effect to any amendment
thereto unless the Mortgage Loan Seller has given its consent to such amendment
in writing and signed by a duly authorized officer of the Mortgage Loan Seller.
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(c) Upon any repurchase of a Mortgage Loan contemplated by Section 3(b)
above, the Trustee, the Servicer and the Special Servicer shall each tender to
the Mortgage Loan Seller, all portions of the Mortgage File and other documents
pertaining to such Mortgage Loan possessed by it, and each document that
constitutes a part of the Mortgage File that was endorsed or assigned to the
Trustee shall be endorsed or assigned, as the case may be, to the Mortgage Loan
Seller.
(d) This Section 3 of this Agreement provides the sole and exclusive remedy
available to the Company, the Trustee, the Certificateholders, or the Trustee on
behalf of the Certificateholders or any other party, respecting any Document
Defect or any Breach.
(e) Subject to the terms of this Agreement, the Mortgage Loan Seller hereby
acknowledges the assignment by the Company to the Trustee, as trustee under the
Pooling and Servicing Agreement, for the benefit of the Certificateholders, of
the representations and warranties contained herein and of the obligation of the
Mortgage Loan Seller to repurchase a Mortgage Loan pursuant to this Section. The
Trustee or its designee may enforce such obligations as provided in Section 8
hereof.
4. Representations, Warranties and Agreements of Company.
(a) The Company hereby represents and warrants to the Mortgage Loan Seller,
as of the date hereof (or such other date as is specified in the related
representation or warranty), as follows:
(i) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, with full corporate
power and authority to own its assets and conduct its business, is duly
qualified as a foreign corporation in good standing in all jurisdictions in
which the ownership or lease of its property or the conduct of its business
requires such qualification, except where the failure to be so qualified
would not have a material adverse effect on the ability of the Company to
perform its obligations hereunder, and the Company has taken all necessary
action to authorize the execution, delivery and performance of this
Agreement by it, and has the power and authority to execute, deliver and
perform this Agreement and all the transactions contemplated hereby;
(ii) This Agreement has been duly authorized, executed and delivered by the
Company and constitutes a valid and binding obligation of the
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Company, enforceable against the Company in accordance with its terms,
except as such enforcement may be limited by bankruptcy, reorganization,
insolvency, moratorium and other similar laws affecting the enforcement of
creditors' rights generally and to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or
at law);
(iii) The execution and delivery of this Agreement by the Company and the
performance of its obligations hereunder will not conflict with any
provision of any law or regulation to which the Company is subject, or
conflict with, result in a breach of or constitute a default under any of
the terms, conditions or provisions of any of the Company's organizational
documents or any agreement or instrument to which the Company is a party or
by which it is bound, or any law, rule, regulation, judgment, writ,
injunction, order or decree applicable to the Company, or result in the
creation or imposition of any lien on any of the Company's assets or
property, in each case which would materially and adversely affect the
ability of the Company to carry out the transactions contemplated by this
Agreement;
(iv) There is no action, suit, proceeding or investigation pending or to
the knowledge of the Company, threatened against the Company in any court
or by or before any other governmental agency or instrumentality which
would materially and adversely affect the validity of this Agreement or any
action taken in connection with the obligations of the Company contemplated
herein, or which would be likely to impair materially the ability of the
Company to perform under the terms of this Agreement;
(v) The Company is not in default with respect to any order or decree of
any court or any order, regulation or demand of any federal, state,
municipal or governmental agency, which default might have consequences
that would materially and adversely affect the condition (financial or
other) or operations of the Company or its properties or might have
consequences that would materially and adversely affect its performance
hereunder;
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<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 Company of or compliance by the Company with this
Agreement or the consummation of the transactions contemplated by this
Agreement other than those that have been obtained by the Company; and
(vii) Under GAAP and for federal income tax purposes, the Company will
report the transfer of the Mortgage Loans by the Mortgage Loan Seller to
the Company as a sale of the Mortgage Loans to the Company.
5. Company's Conditions to Closing.
The obligations of the Company under this Agreement shall be subject to the
satisfaction, on the Closing Date, or such other date specified herein, of the
following conditions:
(a) The obligations of the Mortgage Loan Seller required to be performed by
it at or prior to the Closing Date pursuant to the terms of this Agreement shall
have been duly performed and complied with and all of the representations and
warranties of the Mortgage Loan Seller under this Agreement shall be true and
correct in all material respects, and no event shall have occurred which, with
notice or the passage of time, or both, would constitute a material default
under this Agreement.
(b) The Company or its designee shall have received all of the following
closing documents, in such forms as are agreed upon and acceptable to the
Company and in form and substance satisfactory to the Company, the Underwriters
and their respective counsel, duly executed by all signatories other than the
Company as required pursuant to the respective terms thereof:
(i) with respect to each Mortgage Loan, the related Mortgage File, which
Mortgage Files shall be delivered to and held by the Trustee on behalf of
the Company;
(ii) the final Mortgage Loan Schedule;
(iii) an officer's certificate from the Mortgage Loan Seller dated as of
the Closing Date, in the form attached hereto as Exhibit B;
(iv) an opinion of Mortgage Loan Seller's counsel, subject to customary
exceptions and carve-outs, in form and substance reasonably acceptable to
the Company and its counsel and the Rating Agencies, which states in
substance the opinions set forth on Exhibit C hereto, and
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<PAGE>
(v) such other documents, certificates and opinions as the Company may
reasonably request to effectuate the transactions contemplated by this
Agreement.
(c) The Mortgage Loan Seller hereby agrees to furnish such other
information, documents, certificates, letters or opinions with respect to the
Mortgage Loans or itself as may be reasonably requested by the Company in order
for the Company to perform any of its obligations or satisfy any of the
conditions on its part to be performed or satisfied pursuant to the Underwriting
Agreement, the Pooling and Servicing Agreement or this Agreement.
6. Indemnification and Contribution.
(a) The Mortgage Loan Seller shall indemnify and hold harmless the Company,
the Underwriters, their respective officers and directors, and each person, if
any, who controls the Company or the Underwriters within the meaning of either
Section 15 of the Securities Act of 1933, as amended (the "1933 Act") or Section
20 of the Securities Exchange Act of 1934, as amended (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) (i) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact relating to the Mortgage Loans, the related
Mortgagors, the related Mortgaged Properties or the Mortgage Loan Seller
contained in (A) the Prospectus Supplement and the Memorandum (insofar as the
following are incorporated as part of the Memorandum) under the headings
"Summary of the Prospectus Supplement-The Mortgage Pool" or "Summary of the
Prospectus Supplement-Mortgage Loan Sellers", "Risk Factors-The Mortgage Loans"
and "Description of the Mortgage Pool" and on Annex A to the Prospectus
Supplement, the Diskette or, insofar as they are required to be filed as part of
the Registration Statement pursuant to the No-Action Letters, any Computational
Materials or ABS Term Sheets with respect to the Registered Certificates, or in
any revision or amendment of or supplement to any of the foregoing or (B) any
items similar to Computational Materials and ABS Term Sheets forwarded to
prospective investors in the Non-Registered Certificates, or (ii) arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
but, in the case of (i) and (ii), only if and to the extent that any such untrue
statement or alleged untrue statement or omission or alleged omission (I) arises
out of or is based upon an untrue statement or omission with respect to the
Mortgage Loans, the related Mortgagors or the related Mortgaged Properties
contained in the Master Tape (it being
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herein acknowledged that the Master Tape was used to prepare the Prospectus
Supplement including without limitation Annex A thereto, the Memorandum, the
Diskette, the Computational Materials and ABS Term Sheets with respect to the
Registered Certificates and any items similar to Computational Materials and ABS
Term Sheets forwarded to prospective investors in the Non-Registered
Certificates), (II) is contained in the information regarding the Mortgage
Loans, the related Mortgagor, the related Mortgaged Property or the Mortgage
Loan Seller set forth in the Prospectus Supplement and the Memorandum (insofar
as the following are incorporated as part of the Memorandum) under the headings
"Summary of the Prospectus Supplement-The Mortgage Pool" or "Summary of the
Prospectus Supplement-Mortgage Loan Sellers", "Risk Factors-The Mortgage Loans"
and "Description of the Mortgage Pool" or on Annex A to the Prospectus
Supplement; provided that the foregoing were provided to the Mortgage Loan
Seller for its review, or (III) arises out of or is based upon a breach of the
representations and warranties of the Mortgage Loan Seller set forth in or made
pursuant to Section 2 (such representations and warranties, together with the
information described in the preceding clauses I and II, the "Mortgage Loan
Seller Information"); provided that the indemnification provided by this Section
6 shall not apply to the extent that such untrue statement or omission was made
as a result of an error in (x) the manipulation of, or (y) any calculations
based upon, or (z) any aggregation (other than an aggregation made in the Master
Tape by the Mortgage Loan Seller) of, the information regarding the Mortgage
Loans, the related Mortgagor, the related Mortgaged Property or the Mortgage
Loan Seller set forth in the Master Tape and Annex A to the Prospectus
Supplement, including without limitation the aggregation of such information
with comparable information relating to the mortgage loans conveyed to the Trust
by Daiwa Finance Corp. And Daiwa Real Estate Finance Corp. (the "Other Mortgage
Loans"). This indemnity agreement will be in addition to any liability which the
Mortgage Loan Seller may otherwise have.
For purposes of this Agreement, "Registration Statement" shall mean the
registration statement No. 333-38073 filed by the Company on Form S-3, including
without limitation exhibits thereto and information incorporated therein by
reference; "Prospectus" shall mean the prospectus dated February 25, 1998, as
supplemented by the prospectus supplement dated March 24, 1998 (the "Prospectus
Supplement"), relating to the Registered Certificates, including all annexes
thereto; "Memorandum" shall mean the private placement memorandum dated March
27, 1998, relating to the Non-Registered Certificates; "Registered Certificates"
shall mean the Class A-1, Class A-2, Class B, Class C, Class D, Class E and
Class IO Certificates; "Non-Registered Certificates" shall mean the Certificates
other than the Registered Certificates; "Computational Materials" shall have the
meaning assigned thereto in the no-action letter dated May 20, 1994 issued by
the Division of Corporation Finance of the Securities and Exchange Commission
(the "Commission") to Kidder,
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Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated, and Kidder
Structured Asset Corporation and the no-action letter dated May 27, 1994 issued
by the Division of Corporation Finance of the Commission to the Public
Securities Association (together, the "Kidder Letters"); "ABS Term Sheets" shall
have the meaning assigned thereto in the no-action letter dated February 17,
1995 issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (the "PSA Letter" and, together with the Kidder
letters, the "No-Action Letters"); "Diskette" shall mean the diskette attached
to each of the Prospectus and the Memorandum; and "Master Tape" shall mean the
compilation of information and data regarding the Other Mortgage Loans and the
Mortgage Loans covered by the Independent Accountants' Report on Applying
Agreed-Upon Procedures dated March 24, 1998 and rendered by Deloitte & Touche
LLP (a "hard copy" of which Master Tape was initialed on behalf of the Mortgage
Loan Seller and the Company).
(b) Promptly after receipt by an indemnified party under this Section 6 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 6, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve the
indemnifying party from any liability which it may have to any indemnified party
under this Section 6, except to the extent that it has been prejudiced in any
material respect, or from any liability which it may have, otherwise than under
this Section 6. 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 reasonably satisfactory to such indemnified party;
provided 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 which are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying party
to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party for legal or other expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the
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indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with one local counsel, if applicable), approved by
the Company representing the indemnified parties under subsection (a) of this
Section 6 who are parties to such action), (ii) the indemnifying party shall not
have employed counsel reasonably 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 in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(c) If the indemnification provided for in this Section 6 shall for any
reason be unavailable in accordance with its terms to an indemnified party under
this Section 6, then the Mortgage Loan Seller and the Company shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or (b)
above, in such proportion as is appropriate to reflect the relative fault of the
Mortgage Loan Seller on the one hand and the Company on the other in connection
with the statement or omission that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Mortgage Loan Seller or the Company and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The Mortgage Loan Seller and the Company agree that it
would not be just and equitable if contribution pursuant to this subsection (d)
were to be determined by per capita allocation or by any other method of
allocation that does not take account of the equitable considerations referred
to herein. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
against any action or claim which is the subject of this subsection (d) subject
to the limitations therein provided under subsection (c). No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not also guilty of
such fraudulent misrepresentation.
7. Notices. All communications hereunder shall be in writing and effective
only upon receipt and, if sent to the Company, will be mailed, hand delivered,
couriered or sent by facsimile transmission to it at World Financial Center, New
York, New York 10281, attention: Bruce L. Ackerman fax number: (212)
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449-7684, or, if sent to the Mortgage Loan Seller, will be mailed, hand
delivered, couriered or sent by facsimile transmission to it at 100 Church
Street, 18th Floor, New York, New York 10080-6518, attention: Robert J.
Fitzpatrick fax number: (212) 602-7552.
8. Trust as Beneficiary. The representations, warranties and agreements
made by the Mortgage Loan Seller in this Agreement are made for the benefit of,
and, to the extent they are assigned by the Company to the Trustee under the
Pooling and Servicing Agreement, may be enforced by or on behalf of, the
Trustee, the Servicer or the Special Servicer, as provided in the Pooling and
Servicing Agreement, to the same extent that the Company has rights against the
Mortgage Loan Seller under this Agreement in respect of representations,
warranties and agreements made by the Mortgage Loan Seller herein.
9. Miscellaneous. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES. This Agreement may be executed in any number of
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall together constitute but one and the same instrument. This
Agreement will inure to the benefit of and be binding upon the parties hereto
and their respective successors and assigns, and no other person will have any
right or obligation hereunder, other than as provided herein.
10. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement, or in
certificates of officers of the Mortgage Loan Seller and the Company submitted
pursuant hereto, shall remain operative and in full force and effect and shall
survive the transfer and sale of the Mortgage Loans to the Company and by the
Company to the Trustee notwithstanding any language to the contrary contained in
any endorsement of any Mortgage Loan; provided that the representations,
warranties and agreements shall terminate upon the termination of the Pooling
and Servicing Agreement.
11. Severability. If any provision of this Agreement shall be prohibited or
invalid under applicable law, this Agreement shall be ineffective only to such
extent, without invalidating the remainder of this Agreement.
12. Further Assurances. The Mortgage Loan Seller and the Company agree to
execute and deliver such instruments and take such actions as the other party
may, from time to time, reasonably request in order to effectuate the purpose
and to carry out the terms of this Agreement.
13. Amendments. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated except by a writing signed by a duly authorized
officer of the party
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against whom enforcement of such change, waiver, discharge or termination is
sought to be enforced. This Agreement may not be changed or waived in any manner
which would have a material adverse effect on Certificateholders without the
prior written consent of the Trustee.
[Signature page follows]
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IN WITNESS WHEREOF, the Company and the Mortgage Loan Seller have caused
this Agreement to be duly executed by their respective officers as of the day
and year first above written.
MERRILL LYNCH MORTGAGE CAPITAL, INC.
By: /s/ ROBERT FITZPATRICK
--------------------------------------
Name: Robert Fitzpatrick
Title: Authorized Signatory
MERRILL LYNCH MORTGAGE INVESTORS, INC.
By: /s/ BRUCE ACKERMAN
--------------------------------------
Name: Bruce Ackerman
Title: Authorized Signatory
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
A-1
<PAGE>
<TABLE>
<CAPTION>
ML Only
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
100 10000 Old Katy Road Office/Service Center 10000 Old Katy Road Houston TX
101 1031 South Santa Fe Avenue 1031 South Santa Fe Avenue Vista CA
102 200 South La Brea Retail Center 200 South La Brea Avenue Los Angeles CA
103 3000/3100 Carlisle Buildings 3000/3100 Carlisle Dallas TX
104 380/400 Woodview Avenue 380/400 Woodview Avenue Morgan Hill CA
105 518 Raymond Avenue 518 Raymond Avenue Santa Monica CA
106 524 Raymond Avenue 524 Raymond Avenue Santa Monica CA
107 650 Selig Drive Facility 650 Selig Drive Atlanta GA
108 8000 Centre Park 8000 Centre Park Drive Austin TX
109 AAAAA Rent-A-Space - Hayward 24700 Mission Blvd Hayward CA
110 Antioch Ramada Inn 2436 Mahogany Way Antioch CA
111 Applewood Grove Shopping Center 1975 Youngfield Street Golden CO
112 Arbor Oaks Apartments 3434 & 3500 West Little York Houston TX
113 Atrium at Chesterfield 16305 Swingley Ridge Drive St. Louis MO
114 Avondale Apartments 1st Avenue and Route 41 Avondale PA
115 Bay Pointe South Apartments 4613 Bayshore Drive Naples FL
116 Belcourt Apartments 3117 North 7th Avenue Phoenix AZ
117 Best Western-LaPorte 705 Hwy I-45 South La Porte TX
118 Best Western - Pearl 257 S Pearson Road Pearl MS
119 Best Western Anahiem Hills 5710 East La Palma Avenue Anaheim CA
120 Brea Plaza 1555-1643 Imperial Hwy/409-477 Associated Road Brea CA
121 Briarbend Apartments 349 Briarbend New Braunfels TX
122 Briergreen Apartments 3 Saw Grass Road Charleston SC
123 Broadmoor Mobile Home Park 55 West Washington Street Yakima WA
124 Butler Pike Office Building 4070 Butler Pike Plymouth PA
125 Cambridge Park Apts 2259 Bonaparte Blvd. Montgomery AL
126 Canyon Crest Shopping Center Canyon Crest & Central Ave Riverside CA
127 Carlsbad Inn 3075 Carlsbad Boulevard Carlsbad CA
128 Carlsbad Ramada Inn 751 Macadamia Drive Carlsbad CA
129 Cedar Apartments 424-534 37th Street SE Auburn WA
130 Cedars Apartments 403 Longmire Conroe TX
131 Cedarvale Highlands 3908/3916/3924 Beau d'Rue Dr. Eagan MN
133 Chambers Cove Apartments 201- 272 Chambers Cove Drive Macon GA
134 Chandler Village Phase I & II NE Corner Chandler Blvd @ 54th St. Chandler AZ
135 Charles-Orms Building 10 Orms Street Providence RI
136 Chateau De Vie Apartments 1521 Reagan Hill Austin TX
137 Chelsea Mini Storage 224 12th Street New York NY
138 Cimarron Pointe Apartments 8301 North Council Road Oklahoma City OK
139 Clarkstown Executive Park 704 & 706 Executive Blvd./612 & 614 Corporate Way Valley Cottage NY
140 Comfort Inn - Dallas 8901 East R L Thornton Freeway Dallas TX
141 Comfort Inn - Greenwood 1215 E.Highway 72 Bypass Greenwood SC
142 Comfort Inn - Indiana 3801 N. Frontage Road Michigan City IN
143 Comfort Inn - Vicksburg 3959 East Clay Street Vicksburg MS
144 Comfort Inn Jackson 2800 Greenway Drive Jackson MS
145 Comfort Inn Ruston 1801 N Service Road Ruston LA
146 Comfort Suites - Stafford 4820 Techniplex Drive Stafford TX
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ----------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER ZIP CODE BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
100 77055 2,730,161.67 21,682.38 8.250 113 293 08/01/2007 No Balloon
101 92083 976,665.13 7,639.22 8.000 117 297 12/01/2007 No Balloon
102 90036 5,238,721.73 37,466.63 7.710 117 357 12/01/2007 No Balloon
103 75204 1,989,223.34 15,343.70 7.930 115 295 10/01/2007 No Balloon
104 95037 2,096,001.55 14,488.64 7.260 82 358 01/01/2005 No HyperAm
105 90405 1,023,900.59 7,677.98 7.490 175 295 10/01/2012 No Balloon
106 90405 1,033,841.40 7,752.52 7.490 175 295 10/01/2012 No Balloon
107 30041 6,585,217.39 49,332.88 7.630 178 298 01/01/2013 No Balloon
108 78754 3,202,341.25 24,169.07 7.850 116 320 11/01/2007 No Balloon
109 94544 3,393,201.20 26,989.31 8.330 298 298 01/01/2023 No Fully Amortizing
110 94507 2,532,591.98 23,049.45 9.010 113 233 08/01/2007 No HyperAm
111 80401 2,252,034.76 17,237.43 7.750 117 297 12/01/2007 No Balloon
112 77091 2,992,591.28 21,158.49 7.480 177 357 12/01/2012 No Balloon
113 63017 13,485,479.70 93,476.85 7.280 117 357 12/01/2007 No HyperAm
114 19311 1,074,276.87 8,519.52 8.780 111 351 06/01/2007 No Balloon
115 34112 4,776,012.97 34,520.56 7.790 113 353 08/01/2007 No Balloon
116 85013 3,161,678.32 25,896.78 8.560 48 288 03/01/2002 No Balloon
117 77571 1,341,074.68 11,985.58 8.690 236 236 11/01/2017 No Fully Amortizing
118 39208 1,691,212.92 14,656.32 8.290 237 237 12/01/2017 Yes Fully Amortizing
119 92807 2,155,295.52 18,564.48 8.250 239 239 02/01/2018 Yes Fully Amortizing
120 92621 13,193,866.61 99,521.55 8.010 79 325 10/01/2004 No Balloon
121 78130 1,296,969.38 8,912.42 7.300 117 357 12/01/2007 No Balloon
122 29412 3,139,459.73 22,039.00 7.400 116 356 11/01/2007 No Balloon
123 98903 2,844,506.86 19,486.24 7.170 118 358 01/01/2008 No Balloon
124 19444 2,096,076.13 14,692.33 7.400 118 358 01/01/2008 No HyperAm
125 36116 3,497,970.15 27,635.90 7.560 260 260 11/01/2019 No Fully Amortizing
126 92507 18,964,066.65 131,744.78 7.310 118 358 01/01/2008 No HyperAm
127 92008 3,975,001.18 35,348.43 8.750 116 236 11/01/2007 No HyperAm
128 92009 3,976,960.84 36,194.84 9.010 113 233 08/01/2007 No HyperAm
129 98002 1,376,411.09 9,436.50 7.170 117 357 12/01/2007 No Balloon
130 77304 2,245,651.49 15,352.90 7.150 118 358 01/01/2008 No Balloon
131 55122 2,927,347.12 21,062.52 7.750 114 354 09/01/2007 No Balloon
133 31206 2,145,273.70 16,589.35 7.830 114 294 09/01/2007 No Balloon
134 85226 2,338,090.46 18,622.90 8.310 115 295 10/01/2007 No Balloon
135 02904 3,934,687.24 29,730.59 8.270 114 354 09/01/2007 No Balloon
136 78752 1,782,058.45 13,496.89 7.730 80 296 11/01/2004 No Balloon
137 10001 16,047,887.96 150,053.42 7.380 177 177 12/01/2012 No Fully Amortizing
138 73132 5,378,367.21 37,170.05 7.350 116 356 11/01/2007 No Balloon
139 10989 11,238,226.77 86,020.93 7.840 115 295 10/01/2007 No Balloon
140 75228 1,391,531.21 12,605.17 9.010 236 236 11/01/2017 No Fully Amortizing
141 29649 1,692,325.97 15,317.21 9.020 237 237 12/01/2017 No Fully Amortizing
142 46360 1,490,196.96 13,426.34 8.800 236 236 11/01/2017 No Fully Amortizing
143 39180 2,188,628.49 18,967.00 8.290 237 237 12/01/2017 No Fully Amortizing
144 39204 2,576,612.61 22,329.34 8.290 237 237 12/01/2017 No Fully Amortizing
145 71270 2,089,145.37 18,104.87 8.290 237 237 12/01/2017 No Fully Amortizing
146 77477 1,990,058.03 17,041.31 8.250 117 237 12/01/2007 No HyperAm
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
100 0.095 MLMC First Union 30/360
101 0.125 MLMC MLCC Actual/360
102 0.095 MLMC L.J. Melody 30/360
103 0.095 MLMC First Union 30/360
104 0.095 MLMC L.J. Melody Actual/360
105 0.095 MLMC First Union Actual/360
106 0.095 MLMC First Union Actual/360
107 0.095 MLMC L.J. Melody 30/360
108 0.095 MLMC First Union Actual/360
109 0.125 MLMC MLCC 30/360
110 0.095 MLMC First Union 30/360
111 0.095 MLMC First Union Actual/360
112 0.095 MLMC First Union Actual/360
113 0.095 MLMC First Union Actual/360
114 0.095 MLMC First Union 30/360
115 0.095 MLMC First Union 30/360
116 0.095 MLMC First Union 30/360
117 0.095 MLMC First Union Actual/360
118 0.095 MLMC First Union Actual/360
119 0.125 MLMC MLCC Actual/360
120 0.095 MLMC First Union 30/360
121 0.095 MLMC L.J Melody 30/360
122 0.095 MLMC First Union Actual/360
123 0.095 MLMC L.J. Melody Actual/360
124 0.095 MLMC First Union Actual/360
125 0.095 MLMC First Union Yes Actual/360
126 0.095 MLMC L.J. Melody Actual/360
127 0.090 MLMC GCAM 30/360
128 0.095 MLMC First Union 30/360
129 0.125 MLMC MLCC Actual/360
130 0.095 MLMC L.J. Melody Actual/360
131 0.235 MLMC Arbor 30/360
133 0.095 MLMC First Union Actual/360
134 0.095 MLMC Robert C. Wilson 30/360
135 0.095 MLMC First Union 30/360
136 0.095 MLMC First Union 30/360
137 0.095 MLMC First Union Actual/360
138 0.095 MLMC First Union Actual/360
139 0.095 MLMC First Union 30/360
140 0.095 MLMC First Union 30/360
141 0.095 MLMC First Union 30/360
142 0.095 MLMC First Union Actual/360
143 0.095 MLMC First Union Actual/360
144 0.095 MLMC First Union Actual/360
145 0.095 MLMC First Union Actual/360
146 0.125 MLMC MLCC 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ML Only
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
147 Commons at Briargate 2845 Freewood Point Colorado Springs CO 80920
148 Commons of Laporte 2400 Andrew Laporte IN 46350
149 Copper Hill Apartments 3440 El Dorado Hills Blvd El Dorado Hills CA 95762
150 Costa Neuporte Senior Apartments 2283 Fairview Road Costa Mesa CA 92627
151 Courts at West University 3810 Law Houston TX 77005
152 Courtside/Harrigan's Plaza 5900, 5920 & 5930 West I-20 Arlington TX 76017
153 Creekwood Apartments 710 North 46th Street Killeen TX 76543
154 Crystal Cove Apartments 15615 Blue Ash Drive Houston TX 77090
155 Days Inn 914 Riverview Road Rock Hill SC 29730
156 Days Inn-Fresno 4061 N. Blackstone Avenue Fresno CA 93726
157 Days Inn - Alice 555 N. Johnson Alice TX 78332
158 Days Inn - Southeast 1850 Embassy Square Blvd. Forest Hills KY 40299
159 Days Inn-Lawrenceville 731 West Pike Street Lawrenceville GA 30245
160 DFW Corporate Park 2100 Highway 360 Grand Prairie TX 75050
161 Dickson Kroger Shopping Center Highway 70-Bypass Dickson TN 37055
163 Econo Lodge 962 Riverview Road Rock Hill SC 29730
164 Edgemont Plaza 3071-3167 Provo Canyon Rd/3060 North St. Provo UT 84604
165 Embassy Plaza 6050-6140 Lankershim Blvd North Hollywood CA 91606
166 Evergreen Ridge Apartments 3815 Susan Drive San Bruno CA 94066
167 Farnham Park Office Building 7887 San Felipe Houston TX 77063
168 Forest Park Apartment 303 Des Plaines and 7456 Washington Forest Park IL 60130
169 Fossil Hill Apartments 5700 N. Beach Street Haltom City TX 76137
170 Gannon Place Apartments 3839 Gannon Lane Dallas TX 75237
171 Garden View 16200 West Nine Mile Road Southfield MI 48075
172 Gardens Apartments 1420 17th Street SE Auburn WA 98002
173 Gardenwood Apartments 1400 Gardenia St. San Antonio TX 78201
174 Garfield Villas & Hillcrest Apts. 5150-5220 East 88th Street Garfield Heights OH 44125
175 Goff Building 321 West Main Street Clarksburg WV 26301
176 Hampton Inn - Greensboro 7803 National Service Road Greensboro NC 27409
177 Hampton Inn - Newnan 50 Hampton Way Newnan GA 30265
178 Hampton Inn Peachtree 300 Westpark Drive Peachtree City GA 30269
179 Harvey's Racquet Club Apts 3301 Hudnall Street Dallas TX 75235
180 Hillview Apartments 200 Shalimar Drive Glascow KY 42141
181 Holiday Inn - Brainerd 2025 South 6th Street Brainerd MN 56401
182 Holiday Inn Express - Arlington 2451 Randoll Mill Road Arlington TX 76011
183 Holiday Inn Express - Brentwood 8820 Brentwood Blvd. Brentwood CA 94513
184 Holiday Inn Express - Brownsburg 31 Maplehurst Drive Brownsburg IN 46112
185 Holiday Inn Express - Columbia 1554 Bear Creek Pike Columbia TN 38401
186 Holiday Inn Express - Edinburg 1806 S Closner Blvd Edinburg TX 78539
187 Holiday Inn Express - Goose Creek 103 Redbank Road Goose Creek SC 29445
188 Holmes Center Office Building 3251 W. 6th Street Los Angeles CA 90020
189 Horizon Court Office Building 7450 Horizon Drive Columbus OH 48235
190 Howard Johnson San Mateo 2110 South El Camino Real San Mateo CA 94403
191 Hub Apartments 3136 Hudnall Dallas TX 75235
192 KAR Printing Building 13930 NW 60th Avenue Miami Lakes FL 33014
193 La Costa Apartments 4303 Mariposa Drive Irving TX 75038
194 Lackawanna Station Shopping Plaza One Lackawanna Plaza Montclair NJ 07042
195 Lake Forest Business Park 22512 Aspen St,/23901 Remme Ridge Lake Forest CA 92630
196 Lake Shore Park Apartments Lake Shore Drive Watervliet NY 12189
197 Lancaster East Shopping Center East Lancaster & Edgewood Fort Worth TX 76112
198 Lawrence Shopping Center 2495 U.S. Route 1 Lawrenceville NJ 08648
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ---------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
147 13,589,232.59 96,191.64 7.580 78 354 09/01/2004 No Balloon
148 4,381,410.55 29,683.87 7.060 118 358 01/01/2008 No Balloon
149 2,495,220.54 17,196.60 7.230 118 358 01/01/2008 No Balloon
150 4,381,549.50 31,918.32 7.880 114 354 09/01/2007 No Balloon
151 2,990,545.17 21,636.56 7.400 117 321 12/01/2007 No Balloon
152 2,693,447.29 19,229.41 7.580 117 357 12/01/2007 No Balloon
153 1,491,461.90 12,118.41 7.430 237 237 12/01/2017 No Fully Amortizing
154 3,386,749.97 24,098.88 7.530 115 355 10/01/2007 No Balloon
155 1,739,206.15 16,247.38 9.310 236 236 11/01/2017 No Fully Amortizing
156 1,472,578.56 13,016.58 8.560 237 237 12/01/2017 No Fully Amortizing
157 1,694,592.12 14,806.84 8.550 238 238 01/01/2018 No Fully Amortizing
158 1,789,084.14 16,183.49 8.990 236 236 11/01/2017 No Fully Amortizing
159 997,132.35 9,236.58 9.370 238 238 01/01/2018 No Fully Amortizing
160 8,785,813.87 59,138.81 7.100 118 358 01/01/2008 No Balloon
161 3,239,282.90 23,440.80 7.820 115 355 10/01/2007 No HyperAm
163 2,087,047.40 19,496.85 9.310 236 236 11/01/2017 No Fully Amortizing
164 1,844,324.65 13,167.88 7.320 117 327 12/01/2007 No Balloon
165 5,380,043.59 40,946.06 8.000 176 326 11/01/2012 No Balloon
166 14,263,427.09 98,770.86 7.270 177 357 12/01/2012 No Balloon
167 1,413,680.42 11,221.71 8.160 116 296 11/01/2007 No Balloon
168 3,593,126.90 24,787.95 7.240 118 358 01/01/2008 No Balloon
169 6,487,282.14 43,951.06 7.060 82 358 01/01/2005 No Balloon
170 4,072,221.04 28,121.18 7.250 118 358 01/01/2008 No Balloon
171 2,401,202.27 17,980.45 7.500 117 297 12/01/2007 No Balloon
172 2,595,125.59 18,145.37 7.375 118 358 01/01/2008 No Balloon
173 1,197,730.54 8,320.72 7.310 118 358 01/01/2008 No Balloon
174 1,914,568.32 13,794.94 7.780 116 356 11/01/2007 No Balloon
175 1,970,006.98 16,270.49 8.870 174 306 08/01/2012 No Balloon
176 4,430,539.87 33,816.90 7.820 116 296 11/01/2007 No HyperAm
177 3,744,081.85 33,283.77 8.700 114 234 09/01/2007 No Balloon
178 2,467,089.43 23,189.12 9.430 231 231 06/01/2017 No Fully Amortizing
179 6,262,958.36 49,619.09 8.470 75 315 06/01/2004 No Balloon
180 997,589.16 7,154.16 7.625 117 357 12/01/2007 No Balloon
181 3,542,197.24 30,167.76 8.100 239 239 02/01/2018 No Fully Amortizing
182 2,586,576.02 22,432.20 8.300 237 237 12/01/2017 No Fully Amortizing
183 1,741,165.32 15,323.47 8.500 237 237 12/01/2017 No Fully Amortizing
184 2,600,558.83 22,716.44 8.420 238 238 01/01/2018 No Fully Amortizing
185 1,691,818.47 14,763.76 8.510 237 237 12/01/2017 No Fully Amortizing
186 1,760,938.03 15,356.26 8.375 237 237 12/01/2017 No Fully Amortizing
187 1,542,497.79 13,949.20 8.875 237 237 12/01/2017 No Fully Amortizing
188 2,327,142.98 16,575.54 7.570 119 359 02/01/2008 No Balloon
189 11,938,392.28 94,453.69 8.230 115 295 10/01/2007 No Balloon
190 2,285,715.37 20,398.78 8.800 236 236 11/01/2017 No Fully Amortizing
191 6,932,926.25 54,926.99 8.470 75 315 06/01/2004 No Balloon
192 1,572,489.25 12,053.50 7.790 299 299 02/01/2023 No Fully Amortizing
193 2,890,408.48 20,431.17 7.470 116 356 11/01/2007 No Balloon
194 10,386,646.32 69,247.90 6.910 119 359 02/01/2008 No Balloon
195 6,373,853.73 47,005.56 8.010 114 354 09/01/2007 No Balloon
196 8,257,688.50 59,118.45 7.690 113 353 08/01/2007 No Balloon
197 1,594,667.56 12,032.79 7.700 117 297 12/01/2007 No Balloon
198 13,898,025.04 109,822.28 8.190 113 293 08/01/2007 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
147 0.095 MLMC First Union 30/360
148 0.095 MLMC First Union Actual/360
149 0.095 MLMC L.J. Melody Actual/360
150 0.095 MLMC First Union 30/360
151 0.095 MLMC First Union Actual/360
152 0.095 MLMC L.J. Melody Actual/360
153 0.095 MLMC First Union Actual/360
154 0.095 MLMC First Union Actual/360
155 0.095 MLMC First Union Actual/360
156 0.125 MLMC MLCC Actual/360
157 0.125 MLMC MLCC 30/360
158 0.095 MLMC First Union 30/360
159 0.125 MLMC MLCC 30/360
160 0.095 MLMC L.J. Melody 30/360
161 0.090 MLMC GCAM Actual/360
163 0.095 MLMC First Union Actual/360
164 0.095 MLMC Robert C. Wilson Actual/360
165 0.095 MLMC First Union Actual/360
166 0.095 MLMC First Union Actual/360
167 0.095 MLMC First Union Actual/360
168 0.095 MLMC First Union Actual/360
169 0.095 MLMC L.J. Melody Actual/360
170 0.095 MLMC First Union Actual/360
171 0.125 MLMC MLCC Actual/360
172 0.095 MLMC L.J. Melody Actual/360
173 0.095 MLMC First Union Actual/360
174 0.245 MLMC Arbor Actual/360
175 0.095 MLMC First Union 30/360
176 0.090 MLMC GCAM 30/360
177 0.090 MLMC GCAM 30/360
178 0.090 MLMC GCAM 30/360
179 0.095 MLMC Robert C. Wilson 30/360 Cntrl #'s 191, 216
180 0.095 MLMC First Union Actual/360
181 0.095 MLMC First Union Actual/360
182 0.095 MLMC First Union Actual/360
183 0.095 MLMC First Union Actual/360
184 0.125 MLMC MLCC Actual/360
185 0.095 MLMC First Union 30/360
186 0.095 MLMC First Union Actual/360
187 0.095 MLMC First Union Actual/360
188 0.095 MLMC First Union Actual/360
189 0.095 MLMC First Union 30/360
190 0.095 MLMC First Union 30/360
191 0.095 MLMC Robert C. Wilson 30/360 Cntrl #'s T121179, 216
192 0.095 MLMC L.J. Melody Actual/360
193 0.095 MLMC First Union Actual/360
194 0.095 MLMC First Union Actual/360
195 0.095 MLMC First Union 30/360
196 0.095 MLMC First Union 30/360
197 0.095 MLMC L.J. Melody 30/360
198 0.095 MLMC First Union 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ML Only
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
199 Learwood Square Shopping Center Lear/Nagel and Walker Roads Avon Lake OH 44012
200 Little Saigon Plaza II 9842 Bolsa Ave. Westminster CA 92683
201 Madison Parke Apartments 10501 Steppington Drive Dallas TX 75230
202 Martin Plaza 2420 Martin Blvd Fairfield CA 94533
203 Meadow Oaks Apartments 7770 Meadow Road Dallas TX 75231
204 Meadows Centre 8230-8350 West 80 Blvd. Arvada CO 80005
205 Mesa Tech Industrial/R&D Building 10540 Heater Court San Diego CA 92121
206 Metric Place 1921 Cedar Bend Drive Austin TX 78758
207 Michael's Aurora Plaza 15151 East Mississippi Avenue Aurora CO 80012
208 Mission Bell Plaza 453-593 W. Los Angeles Avenue Moorpark CA 93021
209 Modesto Ramada Inn 2001 West Orangeburg Avenue Modesto CA 95350
210 Monroe Town Center 337 Applegarth Road Cranbury NJ 08520
211 Newport Landing Apartments 10850 Kingsley Road Dallas TX 75238
212 Northwood Hills Apartments 13980 Peyton Dr. Dallas TX 75240
213 Office Court at St Michael's 460 St. Michael's Drive Santa Fe NM 87505
214 Office Max 7610 S Kentucky Oklahoma City OK 73159
215 Oliver Corners Shopping Center Hesperian Blvd & West Hayward CA 94545
216 Park Apartments 5414 Cedar Springs Road Dallas TX 75235
217 Park Place Apartments 9303 Woodfair Houston TX 77036
218 Parkway Plaza Shopping Center 3115 Parker Road & Independence Parkway Plano TX 75023
219 PoPolo Village 4444 FM 1960 Houston TX 77068
220 Portsmouth Industrial Park 124, 300 and 350 Heritage Ave. Portsmouth NH 03801
221 Radford Place Condominiums 3922 Evergreen Irving TX 75061
222 Regency Manor Apartments 2075 Regency Road Lexington KY 40503
223 Regency Park Apartments 4770 North 7th Street Phoenix AZ 85014
224 Ridge Landing Apartments 919 Corder Road Warner Robbins GA 31088
225 Ridglea West Shopping Center 6550 Camp Bowie Blvd. Fort Worth TX 76116
226 River Manor Apartments 200 Colorado Avenue Parachute CO 81635
227 Roadway Inn - Killeen 517 W. Veterans Memorial Blvd Killeen TX 76541
228 Rowesix Office Building 4224 Sixth Avenue Lacey WA 98509
229 Salem Manor 124 York Street Salem NJ 08079
230 Savannah Heights Apartments 2600 Arroyo Avenue Dallas TX 75219
231 Serrano Highlands Apartments 25421 Alta Loma Lake Forest CA 92630
232 Shamrock East Apartments 736 East Foster Avenue State College PA 16801
233 Sheraton Bangor International Airport 308 Godfrey Boulevard Bangor ME 04401
234 Sherwood 70 Associates 155 West 70th Street New York NY 10023
235 Snider Plaza 6801 Hillcrest & 6730 Snider Pl University Park TX 75205
236 South Oak & Taylor Oak Apts. 165 S. Oak Park & 415 South Taylor Oak Park IL 60302
237 Southgate Shopping Center Highway 79 and 21st Street Heath OH 43056
238 Spring Lake Apartments 8800 Hammerly Blvd Houston TX 77080
239 Spring Lake Lakehomes 2217 Hollister Houston TX 77080
240 Spring Village Apartments 601 Poplar Street Sharon Hill PA 19079
241 Sterling Pointe Apartments 6001 Oakland Hills Drive Fort Worth TX 76112
242 Summerfield Villas 8852 E. Bellevue Scottsdale AZ 85257
243 Summit South 300 Centerville Road Warwick RI 02866
244 Tanglewod Apartments 11185 Magnolia Avenue Riverside CA 92505
245 Vallejo Ramada Inn 1000 Admiral Callaghan Lane Vallejo CA 94591
246 Valley View Apartments (Chud) Vermont View Drive Colonie NY 12189
247 Valley View Apartments 7700-7736 Greenview Terrace Baltimore MD 21204
248 Villa Verde Apartments 4200 - 4260 West First Street Santa Ana CA 92704
249 Village at Collin Creek 601 - 641 Plano Parkway Plano TX 75075
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------ MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
199 3,390,166.45 24,170.33 7.670 116 356 11/01/2007 No HyperAm
200 4,689,498.95 34,625.51 7.630 118 322 01/01/2008 No Balloon
201 1,397,502.20 10,137.48 7.750 118 358 01/01/2008 No Balloon
202 2,685,775.46 20,964.40 8.070 55 295 10/01/2002 No Balloon
203 748,661.90 5,430.79 7.750 118 358 01/01/2008 No Balloon
204 4,187,008.02 30,783.56 7.875 116 356 11/01/2007 No Balloon
205 2,840,589.49 20,098.76 7.480 116 356 11/01/2007 No Balloon
206 1,930,968.03 16,055.17 8.830 115 295 10/01/2007 No Balloon
207 6,777,509.53 47,907.57 7.470 116 356 11/01/2007 No Balloon
208 8,423,864.19 64,005.19 8.330 114 354 09/01/2007 No HyperAm
209 2,690,878.99 24,490.04 9.010 113 233 08/01/2007 No HyperAm
210 3,443,820.57 24,908.87 7.720 118 358 01/01/2008 No Balloon
211 2,475,271.60 17,093.27 7.250 118 358 01/01/2008 No Balloon
212 3,748,825.26 26,700.89 7.340 117 321 12/01/2007 No Balloon
213 4,753,340.15 34,298.79 7.810 118 358 01/01/2008 No Balloon
214 1,796,625.40 12,562.18 7.375 118 358 01/01/2008 No HyperAm
215 7,727,996.04 55,629.10 7.770 116 356 11/01/2007 No Balloon
216 3,761,745.18 29,802.91 8.470 75 315 06/01/2004 No Balloon
217 2,909,404.44 19,990.91 7.200 118 358 01/01/2008 No Balloon
218 1,790,668.76 14,096.01 8.170 79 295 10/01/2004 No Balloon
219 3,267,850.83 23,191.51 7.630 117 357 12/01/2007 No Balloon
220 2,649,593.60 21,810.70 7.625 118 238 01/01/2008 No Balloon
221 938,207.78 6,478.90 7.250 118 358 01/01/2008 No Balloon
222 1,197,046.35 8,480.13 7.500 177 357 12/01/2012 No Balloon
223 8,783,753.30 62,118.96 7.490 118 358 01/01/2008 No Balloon
224 1,616,893.56 12,504.63 7.830 114 294 09/01/2007 No Balloon
225 1,555,030.09 12,019.67 7.980 117 297 12/01/2007 No Balloon
226 4,007,472.78 28,020.64 7.375 118 358 01/01/2008 No Balloon
227 1,081,105.78 9,499.29 8.500 238 238 01/01/2018 No Fully Amortizing
228 3,815,922.42 27,619.70 7.720 117 357 12/01/2007 No Balloon
229 1,990,346.17 15,026.33 7.580 116 296 11/01/2007 No Balloon
230 1,832,842.39 13,054.60 7.540 115 355 10/01/2007 No Balloon
231 12,465,157.89 89,392.22 7.030 118 298 01/01/2008 No Balloon
232 1,425,416.96 10,264.59 7.660 116 356 11/01/2007 No Balloon
233 3,089,850.80 26,550.40 8.320 238 238 01/01/2018 Yes Fully Amortizing
234 2,193,155.40 16,070.33 7.840 116 356 11/01/2007 No Balloon
235 1,195,770.66 9,152.62 7.750 117 297 12/01/2007 No Balloon
236 1,896,396.97 13,148.18 7.290 118 358 01/01/2008 No Balloon
237 10,958,660.08 79,508.79 7.730 115 355 10/01/2007 No Balloon
238 3,371,455.91 23,509.65 7.340 117 357 12/01/2007 No Balloon
239 2,334,172.92 16,422.16 7.430 117 357 12/01/2007 No Balloon
240 2,491,116.42 17,962.16 7.780 115 355 10/01/2007 No Balloon
241 2,794,690.26 19,376.27 7.290 118 358 01/01/2008 No Balloon
242 3,810,088.89 26,145.39 7.180 117 357 12/01/2007 No Balloon
243 3,241,581.18 24,546.81 7.640 142 298 01/01/2010 No Balloon
244 1,397,285.01 9,528.85 7.125 118 358 01/01/2008 No Balloon
245 2,146,767.41 19,538.01 9.010 113 233 08/01/2007 No HyperAm
246 10,247,492.97 73,363.86 7.690 113 353 08/01/2007 No Balloon
247 7,660,004.07 58,010.00 8.280 112 352 07/01/2007 No Balloon
248 8,039,797.98 56,537.17 7.520 55 355 10/01/2002 No Balloon
249 7,890,268.98 55,814.35 7.500 119 359 02/01/2008 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
199 0.090 MLMC GCAM Actual/360
200 0.095 MLMC First Union Actual/360
201 0.125 MLMC MLCC Yes Actual/360
202 0.095 MLMC First Union 30/360
203 0.125 MLMC MLCC Yes Actual/360
204 0.095 MLMC First Union Actual/360
205 0.095 MLMC L.J. Melody Actual/360
206 0.095 MLMC First Union 30/360
207 0.095 MLMC First Union Actual/360
208 0.095 MLMC First Union 30/360
209 0.095 MLMC First Union 30/360
210 0.095 MLMC L.J. Melody Actual/360
211 0.095 MLMC First Union Actual/360
212 0.095 MLMC L.J. Melody 30/360
213 0.095 MLMC First Union 30/360
214 0.095 MLMC First Union Actual/360
215 0.095 MLMC First Union 30/360
216 0.095 MLMC Robert C. Wilson 30/360 Cntrl #'s 179, 191
217 0.095 MLMC L.J. Melody Actual/360
218 0.095 MLMC First Union 30/360
219 0.095 MLMC L.J. Melody 30/360
220 0.125 MLMC MLCC Actual/360
221 0.095 MLMC First Union Actual/360
222 0.095 MLMC First Union Actual/360
223 0.095 MLMC First Union Actual/360
224 0.095 MLMC First Union Actual/360
225 0.095 MLMC First Union 30/360
226 0.095 MLMC First Union Actual/360
227 0.095 MLMC First Union Actual/360
228 0.095 MLMC First Union Actual/360
229 0.095 MLMC First Union Actual/360
230 0.095 MLMC First Union Actual/360
231 0.095 MLMC First Union Actual/360
232 0.125 MLMC MLCC Actual/360
233 0.125 MLMC MLCC 30/360
234 0.095 MLMC First Union Actual/360
235 0.095 MLMC L.J. Melody Actual/360
236 0.095 MLMC First Union Actual/360
237 0.095 MLMC First Union Yes Actual/360
238 0.095 MLMC First Union Actual/360
239 0.095 MLMC First Union Actual/360
240 0.095 MLMC First Union 30/360
241 0.095 MLMC First Union Actual/360
242 0.125 MLMC MLCC Actual/360
243 0.125 MLMC MLCC Actual/360
244 0.095 MLMC First Union Actual/360
245 0.095 MLMC First Union 30/360
246 0.095 MLMC First Union 30/360
247 0.095 MLMC First Union 30/360
248 0.095 MLMC Robert C. Wilson 30/360
249 0.095 MLMC L.J. Melody Actual/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ML Only
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
250 Village Green Apartments III/IV W180 N8526 Town Hall Rd Menomonee WI 53051
251 Village Shopping Center 2700 Anderson Lane Austin TX 78757
252 Villas of Josey Ranch 2050 Keller Springs Rd. Carrollton TX 75006
253 Virginia Village Apartments 4904 Fran Place Alexandria VA 22312
254 Westbury Square Office/Retail Center 2301 West Park Row Arlington TX 76013
255 Westchester Manor 107 Westchester Circle Athens GA 30606
256 Wickes Headquarters 706 N. Deerpath Road Vernon Hills IL 60061
257 Williamstown Apartments 3242 Norwalk Avenue Dallas TX 75220
258 Willowick & Willow Creek Apts 430-502 Southwest Parkway College Station TX 77840
259 Windfern Meadows Apartments 12919 Windfern Houston TX 77064
260 Windjammer Cove Apartments 79 Shaw Street Braintree MA 02184
261 Woodridge Apartments 2699 Ridge Road East Irondequoit NY 14622
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------ MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
250 1,796,568.11 12,406.40 7.250 178 358 01/01/2013 No Balloon
251 5,136,222.35 37,976.08 7.370 118 298 01/01/2008 No Balloon
252 6,845,755.37 49,574.73 7.810 113 353 08/01/2007 No Balloon
253 9,983,264.80 65,926.91 6.910 118 358 01/01/2008 No Balloon
254 2,241,483.86 17,335.37 8.120 116 320 11/01/2007 No Balloon
255 2,392,101.63 16,958.73 7.500 116 356 11/01/2007 No Balloon
256 5,307,965.38 43,332.31 8.570 112 292 07/01/2007 No Balloon
257 1,442,995.74 10,895.39 7.580 116 296 11/01/2007 No Balloon
258 5,090,372.50 35,437.79 7.330 118 358 01/01/2008 No Balloon
259 4,240,238.56 29,353.69 7.375 117 357 12/01/2007 No Balloon
260 2,887,413.45 22,114.38 7.860 296 296 11/01/2022 No Fully Amortizing
261 6,674,630.06 48,838.68 7.240 177 297 12/01/2012 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
250 0.095 MLMC First Union Actual/360
251 0.095 MLMC First Union Actual/360
252 0.095 MLMC First Union 30/360
253 0.095 MLMC L.J. Melody 30/360
254 0.095 MLMC Robert C. Wilson Actual/360
255 0.095 MLMC First Union Actual/360
256 0.095 MLMC First Union 30/360
257 0.095 MLMC First Union Actual/360
258 0.095 MLMC L.J. Melody Actual/360
259 0.095 MLMC First Union 30/360
260 0.255 MLMC Arbor Actual/360
261 0.125 MLMC MLCC Actual/360
</TABLE>
(1) Primary and master servicing fee.
<PAGE>
EXHIBIT B
FORM OF CERTIFICATE OF AN OFFICER OF
MERRILL LYNCH MORTGAGE CAPITAL, INC.
I, ______________________, hereby certify that I am an authorized signatory
of Merrill Lynch Mortgage Capital, Inc., a Delaware corporation (the "Seller"),
and that, based upon information provided to me by appropriate officers, certify
further as follows, to the best of my knowledge:
1. The representations and warranties of the Seller in the Mortgage Loan
Purchase Agreement, dated as of March 1, 1998 (the "MLPA") 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.
2. The Seller has, in all material aspects, complied with all the
agreements and satisfied all the conditions on its part that are required
under the MLPA to be performed or satisfied at or prior to the date hereof.
IN WITNESS WHEREOF, I have executed this Certificate as of __________,
1998.
MERRILL LYNCH MORTGAGE CAPITAL, INC.
By: __________________________________
Name:
Title: Authorized Signatory
I, ______________________, a ________________ of the Seller, hereby certify
that ______________________ is an authorized signatory of the Seller and that
the signature appearing above is his genuine signature.
IN WITNESS WHEREOF, I have executed this Certificate as of __________,
1998.
By: __________________________________
Name:
Title:
B-1
<PAGE>
EXHIBIT C
FORM OF LEGAL OPINION
1. The Mortgage Loan Seller is a New York corporation duly organized,
validly existing and in good standing under the laws of the State of New York,
with full corporate power and authority to own its assets and conduct its
business as presently conducted by it, to own the Mortgage Loans, and enter into
and perform its obligations under the Mortgage Loan Purchase Agreement.
2. The Mortgage Loan Purchase Agreement has been duly authorized, executed
and delivered by the Mortgage Loan Seller and constitutes the legal, valid and
binding obligations of the Mortgage Loan Seller, enforceable against the
Mortgage Loan Seller in accordance with the terms of the Mortgage Loan Purchase
Agreement, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally, and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law),
and except to the extent rights to indemnity and contribution may be limited by
applicable law.
3. The execution and delivery of the Mortgage Loan Purchase Agreement by
the Mortgage Loan Seller and the performance of its obligations under the
Mortgage Loan Purchase Agreement will not conflict with any provision of any
federal or State of New York law or regulation to which the Mortgage Loan Seller
is subject, or conflict with, result in a breach of or constitute a default
under any of the terms, conditions or provisions of any of the Mortgage Loan
Seller's organizational documents, or, to our knowledge, any agreement or
instrument to which the Mortgage Loan Seller is a party or by which it is bound,
or any order of a federal or State of New York court, regulatory body,
administrative agency or government body having jurisdiction over the Mortgage
Loan Seller.
4. There is no action, suit, proceeding or investigation pending or
threatened, against the Mortgage Loan Seller in any court or by or before any
other governmental agency or instrumentality which would materially and
adversely affect the validity of the Mortgage Loans or the ability of the
Mortgage Loan Seller to carry out the transactions contemplated by this
Agreement.
5. No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Mortgage Loan Seller of or compliance by the Mortgage Loan
Seller with the Mortgage Loan Purchase Agreement or the consummation of the
transactions contemplated by the Mortgage Loan Purchase Agreement, other than
those which have been obtained by the Mortgage Loan Seller.
C-2-1
<PAGE>
Merrill Lynch Mortgage Investors, Inc. 1998-C2
SCHEDULE I
(i) Immediately prior to the sale, transfer and assignment of the Mortgage
Loans to the Company, the Mortgage Loan Seller had good and marketable title to,
and was the sole owner of, each Mortgage Loan;
(ii) The Mortgage Loan Seller is transferring such Mortgage Loan free and
clear of any and all liens, pledges, charges or security interests of any nature
encumbering such Mortgage Loan, and none of the Mortgage Note, the Mortgage or
any other related loan document prohibits such transfer;
(iii) Each related Mortgage Note, Mortgage, Assignment of Leases (if any)
and other agreement executed in connection with such Mortgage Loan is, a valid
and binding obligation of the related Mortgagor (subject to any non-recourse
provisions therein and any state anti-deficiency legislation), enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws affecting the
enforcement of creditors' rights generally, or by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and any lost note affidavit included in the Mortgage File in lieu of
a Mortgage Note does not impair the ability of the holder thereof to enforce the
terms of such Mortgage Note;
(iv) Each related Assignment of Leases, or, if none, the assignment of
leases and rents contained in the related Mortgage creates a valid, collateral
or first priority assignment of, or a valid first priority 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, 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;
(v) Each related assignment of Mortgage from the Mortgage Loan Seller to
the Trustee and any related assignment of Assignment of Leases, if any, and
assignment of any other agreement executed in connection with such Mortgage
Loan, from the Mortgage Loan Seller to the Trustee constitutes the legal, valid
and binding assignment from the Mortgage Loan Seller to the Trustee, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
liquidation, receivership, moratorium or other laws relating to or affecting
creditors' rights generally or by general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at law);
<PAGE>
(vi) Since origination, such Mortgage Loan has not been modified, altered,
satisfied, canceled, subordinated or rescinded, except, in each of the foregoing
instances, by written instruments that are a part of the related Mortgage File,
and, if required, 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 Company, and no material portion of the
related Mortgaged Property has been released from the lien of the related
Mortgage, in each case, in any manner which materially and adversely affects the
value of the Mortgage Loan or materially interferes with the security intended
to be provided by such Mortgage, and, except with respect to those Mortgage
Loans listed on Exhibit I-VI attached hereto which permit defeasance and
substitution of real property collateral, the terms of the related Mortgage do
not provide for release of any portion of the Mortgaged Property from the lien
of the Mortgage in any manner which materially and adversely affects the
security provided by the Mortgaged Property;
(vii) Each related Mortgage is a valid first lien on the related Mortgaged
Property (subject to the matters described in clause (viii) below), and such
Mortgaged Property is free and clear of any mechanics' and materialmen's liens
which are prior to or equal with the lien of the related Mortgage, except those
which are insured against by a lender's title insurance policy (as described in
clause (viii) below);
(viii) The lien of each related Mortgage as a first priority lien in the
outstanding principal amount of such Mortgage Loan (as set forth on the Mortgage
Loan Schedule) after all advances of principal is insured by an ALTA lender's
title insurance policy (or a binding commitment therefor), or its equivalent as
adopted in the applicable jurisdiction, insuring the Mortgage Loan Seller, its
successors and assigns, subject only to (a) the lien of current real property
taxes, ground rents, water charges, sewer rents and assessments not yet due and
payable, (b) covenants, conditions and restrictions, rights of way, easements
and other matters of public record, none of which, individually or in the
aggregate, materially interferes with the current use of the Mortgaged Property
or the security intended to be provided by such Mortgage or with the Mortgagor's
ability to pay its obligations when they become due or materially and adversely
affects the value of the Mortgaged Property, and (c) the exclusions and
exceptions (general and specific) set forth in such policy, none of which,
individually or in the aggregate, materially interferes with the security
intended to be provided by such Mortgage or with the Mortgagor's ability to pay
its obligations when they become due or materially and adversely affects the
value of the Mortgaged Property; the original holder of the Mortgage, and/or its
successor or assigns, are the sole named insureds under such policy; such policy
is assignable to the Company and the Trustee without the consent of or any
notification to the insurer, and is now in full force and effect
-2-
<PAGE>
and will remain so upon the consummation of the transactions contemplated by
this Agreement; no claims have been made under such policy, the Mortgage Loan
Seller has not done anything, by act or omission, and the Mortgage Loan Seller
has no knowledge of any matter, which would impair or diminish the coverage of
such policy;
(ix) The proceeds of such Mortgage Loan have been fully disbursed and there
is no requirement for future advances thereunder and the Mortgage Loan Seller
covenants that it will not make any future advances under the Mortgage Loan to
the related Mortgagor;
(x) The Mortgage Loan Seller has received no notice of any proceeding
pending, nor to the Mortgage Loan Seller's knowledge, threatened, for the total
or partial condemnation of all or any material portion of such Mortgaged
Property, and, to the Mortgage Loan Seller's knowledge, each related Mortgaged
Property is free and clear of any material damage that would affect materially
and adversely the value of such Mortgaged Property as security for the Mortgage
Loan.
(xi) Except as indicated on Exhibit I-XI(A) attached hereto, the related
Mortgagor has represented to the Mortgagee that, as of the date of origination
of such Mortgage Loan, and, to the Mortgage Loan Seller's knowledge, either (a)
such Mortgagor and the lessee and/or operator of the related Mortgaged Property
was in possession of all material licenses, permits and other authorizations
necessary and required by all applicable laws for the conduct of its business
and all such licenses, permits and authorizations were valid and in full force
and effect, or (b) such Mortgagor uses, operates, occupies and maintains the
Mortgaged Property in accordance with all applicable laws and regulations;
(xii) The Mortgage Loan does not have a shared appreciation feature, other
contingent interest feature or (except with respect to those Mortgage Loans
listed on Exhibit I-XII attached hereto (the "ARD Loans")) provide for
hyper-amortization, a negative amortization feature;
(xiii) The Mortgage Loan is a whole loan and no other party holds a
participation interest in such Mortgage Loan;
(xiv) The Mortgage Rate (exclusive of any default interest, late charges,
prepayment premiums or defeasance deposits) of each Mortgage Loan complied as of
the date of origination with, or such Mortgage Loan is exempt from, applicable
state or federal laws, regulations and other requirements pertaining to usury;
any and all other requirements of any federal, state or local laws, including,
without limitation, truth-in-lending, real estate settlement procedures, equal
credit opportunity or disclosure laws, applicable to each
-3-
<PAGE>
Mortgage Loan have been complied with as of the date of origination of such
Mortgage Loan;
(xv) All taxes and governmental assessments which would be a lien on the
Property and that prior to the Cut-Off Date became due and owing in respect of
each related Mortgaged Property have been paid, or an escrow of funds in an
amount sufficient to cover such payments has been established;
(xvi) Except as indicated on Exhibit I-XVI attached hereto, all escrow
deposits and payments required pursuant to the Mortgage Loan are in the
possession, or under the control, of the Mortgage Loan Seller or its agent and
all amounts required to be deposited by the Borrower under the Loan Documents as
of the date hereof have been deposited and all such escrows and deposits have
been conveyed by the Mortgage Loan Seller to the Company and identified as such
with appropriate detail;
(xvii) Except as indicated on Exhibit I-XVII, as of the date of its
origination, each related Mortgaged Property is insured by a fire and extended
perils insurance policy in an amount not less than the lesser of (A) the
outstanding principal balance of the Mortgage Loan and (B) the replacement cost
of the related Mortgaged Property, and in all events the amount necessary to
avoid the operation of any co-insurance provisions with respect to the Mortgaged
Property; with respect to each related Mortgaged Property, the Mortgagor is
required to maintain, for Mortgage Loans greater than $1,000,000, business
interruption insurance (or loss of rents insurance) and comprehensive general
liability insurance in amounts generally required by institutional lenders for
similar properties; all premiums on such insurance policies required to be paid
as of the date hereof have been paid; such insurance policies require prior
notice to the insured and to the Mortgagee of termination or cancellation, and
except for as indicated on Exhibit I-XVII, no such notice has been received;
each related Mortgage or loan agreement obligates the related Mortgagor to
maintain a fire and extended perils insurance and, at such Mortgagor's failure
to do so, authorizes the Mortgagee to maintain such insurance at the Mortgagor's
cost and expense and to seek reimbursement therefor from such Mortgagor;
(xviii) Each Mortgage provides that any insurance proceeds in respect of a
casualty, other than business interruption/rental income insurance, and any
condemnation awards or insurance proceeds, will be applied either to the repair
or restoration of the Mortgaged Property or to the repayment of the outstanding
principal balance of the Mortgage Loan;
(xix) (A) To the Mortgage Loan Seller's knowledge, there is no material
default, breach, violation or event of acceleration existing under the related
Mortgage or the related Mortgage Note, and no event (other than payments due but
not yet delinquent) which, with the passage of time or with
-4-
<PAGE>
notice and the expiration of any grace or cure period, would constitute a
material default, breach, violation or event of acceleration, and (B) the
Mortgage Loan Seller has not waived in writing any material 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;
(xx) No Monthly Payment on such Mortgage Loan has been more than 30 days
delinquent from the later of one year prior to the Cut-off Date, the date of
origination of such Mortgage Loan or, if applicable, the date of acquisition by
the Mortgage Loan Seller of such Mortgage Loan, through the Cut-off Date;
(xxi) Each related Mortgage contains customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate for the
realization against the Mortgaged Property of the benefits of the security,
including realization by judicial or, if applicable, non-judicial foreclosure,
subject to the effects of bankruptcy or other law affecting the right of
creditors generally and the application of principles of equity, and there is no
exemption available to the Mortgagor which would interfere with such right to
foreclose;
(xxii) Except as indicated on Exhibit I-XXII attached hereto, one or more
environmental site assessments were performed by an environmental consulting
firm independent of the Mortgage Loan Seller and the Mortgage Loan Seller's
affiliates with respect to related Mortgaged Property during the 18 month period
preceding the closing of the Mortgage Loan and the Mortgage Loan Seller, having
made no independent inquiry other than to review the report(s) prepared in
connection with the assessments referred to herein, has no knowledge of any
material and adverse environmental condition or circumstance affecting such
Mortgaged Property that was not disclosed in such report(s);
(xxiii) Each related Mortgage, Mortgage Note or loan agreement contains
provisions for the acceleration of the payment of the unpaid principal balance
of such Mortgage Loan if, without complying with the requirements of the
Mortgage or loan agreement, as applicable, the related Mortgaged Property, or
any controlling interest therein, is directly or indirectly transferred or sold
or is encumbered in connection with subordinate financing (other than any
existing subordinate debt);
(xxiv) Each Mortgage Loan constitutes a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended
(the "Code"). For this purpose, Section 860G(a)(3) of the Code shall be applied
without regard to the rule contained in Treasury Regulations Section
1.860G-2(f)(2) which treats a defective mortgage loan as
-5-
<PAGE>
a "qualified mortgage" under certain circumstances. Accordingly, the Mortgage
Loan Seller represents and warrants that each Mortgage Loan is directly secured
by a Mortgage on a commercial property or a multifamily residential property,
and either (1) substantially all of the proceeds of such Mortgage Loan were used
to acquire, improve or protect the portion of such commercial or multifamily
residential property that consists of an interest in real property and such
interest in real property was the only security for such Mortgage Loan as of the
Testing Date (as defined below), or (2) the fair market value of the interest in
real property which secures such Mortgage Loan was at least equal to 80% of the
principal amount of the Mortgage Loan (a) as of the Testing Date, or (b) as of
the Closing Date. For purposes of the previous sentence, (1) the fair market
value of the referenced interest in real property shall first be reduced by (a)
the amount of any lien on such interest in real property that is senior to the
Mortgage Loan, and (b) a proportionate amount of any lien on such interest in
real property that is on a parity with the Mortgage Loan, and (2) the "Testing
Date" shall be the date on which the referenced Mortgage Loan was originated
unless (a) such Mortgage Loan was modified after the date of its origination in
a manner that would cause a "significant modification" of such Mortgage Loan
within the meaning of Treasury Regulations Section 1.1001-3(b), and (b) such
"significant modification" did not occur at a time when such Mortgage Loan was
in default or when default with respect to such Mortgage Loan was reasonably
foreseeable. However, if the referenced Mortgage Loan has been subjected to a
"significant modification" after the date of its origination and at a time when
such Mortgage Loan was not in default or when default with respect to such
Mortgage Loan was not reasonably foreseeable, the Testing Date shall be the date
upon which the latest such "significant modification" occurred;
(xxv) As of the Cut-off Date the Mortgage Loan Schedule is true and correct
in all material respects;
(xxvi) Prepayment Premiums and Yield Maintenance Charges payable with
respect to the Mortgage Loan, if any, constitute "customary prepayment
penalties" within the meaning of Treasury Regulations Section 1.860G-1(b)(2);
(xxvii) The Mortgage File contains an appraisal of the related Mortgaged
Property, which appraisal is signed by a qualified appraiser who, to the
Mortgage Loan Seller's knowledge, had no interest, direct or indirect, in the
Mortgaged Property or in any loan made on the security thereof, and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and the appraisal and appraiser both satisfy the requirements of Title XI
of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and
the regulations promulgated thereunder, all as in effect on the date the
Mortgage Loan was originated;
-6-
<PAGE>
(xxviii) None of the material improvements which were included for the
purposes 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 such property (except Mortgaged Properties
which are legal non-conforming uses and/or except for immaterial encroachments
off of the Mortgaged Property or where the same is covered by a title insurance
endorsement or affirmative title insurance coverage), and no improvements on
adjoining properties materially encroach upon such Mortgaged Property, or the
requisite title insurance has been obtained with respect to the foregoing;
(xxix) The related Mortgagor has covenanted in the Mortgage Loan documents
to maintain the related Mortgaged Property in compliance with all applicable
laws, zoning (including legal non-conforming uses), ordinances rules, covenants
and restrictions affecting the construction, occupancy, use and operation of
such Mortgaged Property, and the related originator performed the type of due
diligence in connection with the origination of such Mortgage Loan customarily
performed by prudent institutional commercial and multifamily mortgage lenders
with respect to the foregoing matters; the Mortgage Loan Seller has received no
notice of any material violation of any applicable laws, zoning ordinances,
rules, covenants or restrictions affecting the construction, occupancy, use or
operation of such Mortgaged Property;
(xxx) Except as indicated on Exhibit I-XXX(A), With respect to the Mortgage
Loans which as of the Cut-off Date have a principal balance of at least $15
million, the related Mortgagor is an entity which has represented and covenanted
in connection with the origination of the Mortgage Loan, or whose organizational
documents provide, that so long as the Mortgage Loan is outstanding it will be a
single-purpose entity. For this purpose, "single-purpose entity" shall mean a
person, other than an individual, which does not engage in any business
unrelated to the related Mortgaged Property (which may include multiple
Mortgaged Properties owned by the same Borrower and securing only Mortgage Loans
conveyed hereunder as listed on Exhibit I-XXX(B)) and its (or their) financing,
does not have any material assets other than those related to its interest in
such Mortgaged Property (or Mortgaged Properties) or its (or their) financing,
or any indebtedness other than as permitted by the related Mortgage or the other
documents in the Mortgage Loan File, and such Mortgagor has covenanted under the
Mortgage that it will maintain its own books and records separate and apart from
any other person, and holds itself out as being a legal entity, separate and
apart from any other person;
(xxxi) The Mortgage Loan complied, in all material respects, with all of
the terms, conditions and requirements of the Mortgage Loan Seller's applicable
-7-
<PAGE>
underwriting standards in effect at the time of the origination or acquisition
of such Mortgage Loan;
(xxxii) The Mortgage Loan Seller has no knowledge nor has it received any
notice that any Mortgagor is a debtor in any state or federal bankruptcy or
insolvency proceeding;
(xxxiii) To the best of Mortgage Loan Seller's knowledge, as of the Closing
Date, there is no right of rescission, offset, abatement, diminution, defense or
counterclaim to the Mortgage Loan (including the defense of usury), nor will the
operation of any of the terms of the Mortgage Note or the Mortgage, or the
exercise of any rights thereunder, render the Mortgage Note or the Mortgage
unenforceable, in whole or in part (excluding provisions relating to default
interest, yield maintenance charges, prepayment premiums or defeasance
deposits), or subject to any right of rescission, offset, abatement, diminution,
valid defense or counterclaim (including the defense of usury or the violation
of any applicable disclosure or consumer credit laws), except in any such case
as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other laws affecting the enforcement of creditors' rights
generally or by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), and no such
right of rescission, offset, abatement, diminution, defense or counterclaim has
been asserted with respect thereto;
(xxxiv) In the case of any Mortgage which is a deed of trust, a trustee,
duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in the deed of trust or has been
substituted in accordance with applicable law, and no fees or expenses are, or
will become, payable to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the Mortgagor or in connection
with the release of the Mortgaged Property or related security for the Mortgage
Loan following the payment of the Mortgage Loan in full;
(xxxv) The improvements located on the Mortgaged Property are either not
located in a federally designated special flood hazard area designated by the
Federal Emergency Management Agency as Zone A or Zone V or the Mortgagor is
required to maintain or the Mortgagee maintains, flood insurance with respect to
such improvements;
(xxxvi) If the Mortgaged Property is subject to any leases, the Mortgagor
is the owner and holder of the landlord's interest under any leases and the
related Mortgage or Assignment of Leases provides for the appointment of a
receiver for rents (in accordance with applicable law) or allows the Mortgagee
(in accordance with applicable law) to enter into possession to collect rent or
provides for rents to be paid directly to Mortgagee;
-8-
<PAGE>
(xxxvii) The Mortgage Note is not secured by any collateral that is not
being transferred hereunder;
(xxxviii) Each Mortgage Loan, if any, that is cross-collateralized is
cross-collateralized only with one or more other Mortgage Loans being
transferred hereunder;
(xxxix) The origination (or acquisition, as the case may be), servicing and
collection practices used with respect to the Mortgage Loan by the Mortgage Loan
Seller and, to the Mortgage Loan Seller's knowledge, by any prior holder of the
Mortgage Loan, have been in all respects legal, proper and prudent in all
material respects and have met customary industry standards;
(xl) No advance of funds has been made other than pursuant to the loan
documents, directly or indirectly, by the Mortgage Loan Seller to the Mortgagor
and, except as indicated on Exhibit I-XL attached hereto, to the Mortgage Loan
Seller's knowledge, no funds have been received from any person other than the
Mortgagor, for or on account of payments due on the Mortgage Note or the
Mortgage;
(xli) UCC Financing Statements have been filed and/or recorded in all
places necessary to perfect a valid security interest in all material furniture,
fixtures and equipment owned by a Mortgagor and located on each Mortgaged
Property and for which perfection is accomplished by the filing of a UCC
financing statement, and the mortgages, security agreements, chattel mortgages
or equivalent documents related to and delivered in connection with the related
Mortgage Loans establish and create a valid and enforceable first lien and first
priority security interest on such material furniture, fixtures and equipment
except as enforceability may be limited by bankruptcy or other laws affecting
creditor's rights generally or by the application of the rules of equity;
(xlii) Except as indicated on Exhibit I-XLII attached hereto as being
subject to subordinate debt secured by a subordinate mortgage encumbering the
related Mortgaged Property (the "Subordinate Debt Mortgage Loans"), as of the
date of the Prospectus, to the Mortgage Loan Seller's knowledge, the Mortgagor
has no indebtedness for borrowed money secured by a mortgage encumbering the
Mortgaged Property other than the Mortgage Loan. Except as indicated in Exhibit
I-XLII, with respect to the Subordinate Debt Mortgage Loans, the creditor (the
"Subordinate Lender") under such secured indebtedness for borrowed money ("Other
Debt") of the Mortgagor has entered into a subordination agreement with the
Mortgage Loan Seller (or the Mortgage Loan originator) pursuant to which (A) the
Subordinate Lender has agreed to fully subordinate the Other Debt to the
Mortgage Loan (collectively, the "Senior Debt"), (B) the Subordinate Lender has
agreed not to declare a default or exercise any remedies with respect to the
Other Debt until the
-9-
<PAGE>
Senior Debt has been paid in full, and (C) such subordination agreement is
assignable to the Company and its successors and assigns and is being assigned
hereunder and is part of the Mortgage File;
(xliii) 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 I-XLIII and, 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 the amount set forth in Exhibit I-XLIII attached hereto;
(xliv) The Mortgage Loan has an interest rate of at least 6.91% per annum;
(xlv) The Mortgage Loan is non-recourse to the related Mortgagor (or its
principals) except for certain circumstances including fraud, misappropriation,
material misrepresentation and other matters expressly set forth in the related
Mortgage Loan documents;
(xlvi) The Mortgage Loan Seller (or Mortgage Loan originator) has inspected
or caused to be inspected each related Mortgage Property within twelve months of
origination;
(xlvii) Except as set forth in Schedule II, the Mortgage Loan is not
secured in whole or in part by a ground lease; and
(xlviii) 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 Mortgaged Property that, if determined
adversely to such Mortgagor, would materially and adversely affect the ability
of the Mortgagor to pay principal, interest or any other amount due under such
Mortgage Loan.
-10-
<PAGE>
SCHEDULE II
For each Mortgage Loan identified on the Mortgage Loan Schedule as a ground
lease, the Mortgage Loan Seller hereby represents and warrants:
(A)(i) the Mortgage Loan is also secured by the related fee interest or
(ii) the ground lease represents a non-essential portion of the Mortgaged
Property, and the ground lease has an original term (or an original term plus
one or more optional renewal terms, which, under all circumstances, may be
exercised, and will be enforceable, by the Mortgagor, or the Mortgagee if the
Mortgagee acquires the related Mortgaged Property upon foreclosure,
assignment-in-lieu of foreclosure or otherwise) that extends not less than 10
years beyond the stated maturity of the related Mortgage Loan, or
(B) if the Mortgage Loan is secured by a Mortgage constituting a valid
first lien on an unencumbered interest of the Borrower as lessee under a ground
lease underlying the related Mortgaged Property, then the Mortgage Loan Seller
represents and warrants the following:
(i) The ground lease (which shall mean such ground lease, all amendments
and modifications thereof and any related estoppels or agreements from ground
lessor) or a memorandum regarding it has been duly recorded. The ground lease
permits the interest of the lessee to be encumbered by the related Mortgage and
does not restrict the use of the related Mortgaged Property by such lessee, its
successors or assigns in a manner that would adversely affect the security
provided by the related Mortgage. There has been no material change in the terms
of such ground lease since its recordation, except by written instruments, all
of which are included in the related Mortgage File;
(ii) The lessor under such ground lease has agreed in a writing included in
the related Mortgage File that the 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, except if an event of default occurs under the Ground
Lease and notice is provided to the Mortgagee and such default is curable by the
Mortgagee, but remains uncured beyond the applicable cure period;
(iii) The ground lease has an original term (or an original term plus one
or more optional renewal terms, which, under all circumstances, may be
exercised, and will be enforceable, by the Mortgagee) that extends not less than
10 years beyond the stated maturity of the related Mortgage Loan;
(iv) The ground lease is not subject to any liens or encumbrances superior
to, or of equal priority with, the
<PAGE>
Mortgage (including without limitation, the rights of any fee-mortgage, if any)
other than the related ground lessor's related fee interest and any exceptions
set forth in the related title insurance policy or opinion of title;
(v) The ground lease is assignable to the Mortgagee and its assigns without
the consent of the lessor thereunder (or, if any such consent is required, it
has been obtained prior to the Closing Date);
(vi) As of the date of origination of the Mortgage Loan, and to the
Mortgage Loan Seller's knowledge as of the Cut-off Date, the ground lease is in
full force and effect and no default has occurred, nor is there any existing
condition which, but for the passage of time or giving of notice, would result
in a default under the terms of the ground lease;
(vii) The ground lease or ancillary agreement between the lessor and the
lessee requires the lessor to give notice of any default by the lessee to the
Mortgagee. The ground lease or ancillary agreement further provides that either
no notice given is effective or no termination of the lease in connection
therewith will be effective against the Mortgagee unless written notice of such
default or a copy thereof has been given to the Mortgagee in a manner described
in the ground lease or ancillary agreement;
(viii) The Mortgagee is permitted a reasonable opportunity, which may be
concurrent and coterminous with the Mortgagor's rights thereunder (including,
where necessary, sufficient time to gain possession of the interest of the
lessee under the ground lease through legal proceedings, or to take other action
so long as the Mortgagee is proceeding) to cure any default under the ground
lease which is curable after the receipt of notice of any default before the
lessor may terminate the ground lease;
(ix) The ground lease does not impose any restrictions on subletting by the
Mortgagee that would be viewed as commercially unreasonable by a prudent
commercial mortgage lender;
(x) The ground lease provides that any related insurance proceeds or
condemnation award (other than in respect of a total or substantially total loss
or taking) will be applied either to the repair or restoration of all or part of
the related Mortgaged Property, with the Mortgagee or a trustee appointed by it
having the right to hold and disburse such proceeds as repair or restoration
progresses, or, in the case of condemnation, assigned to the mortgagee, or in
the case of casualty to Tenants, to the payment of the outstanding principal
balance of the Mortgage Loan, together with any accrued interest (except in
cases where a different allocation would not be viewed as commercially
unreasonable by any institutional investor, taking
-2-
<PAGE>
into account the relative duration of the ground lease and the related Mortgage
and the ratio of the market value of the related Mortgaged Property to the
outstanding principal balance of such Mortgage Loan);
(xi) Until the principal balance and accrued interest are paid in full,
neither the lessee nor the lessor under the ground lease will have the option to
terminate or modify the ground lease without prior written consent of the
Mortgagee as a result of any casualty or partial condemnation, except to provide
for an abatement of the rent;
(xii) 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 upon the rejection of the lease
in bankruptcy; and
(xiii) Except as set forth on Exhibit II-XIII attached hereto, the ground
lease does not provide for an increase in rental payments.
-3-
<PAGE>
SCHEDULE III
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:
(i) Except as indicated on Exhibit III-I, attached hereto, 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 number of beds, and approved
provider status in any approved provider payment program (collectively, the
"Licenses");
(ii) 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.
(iii) As of the Cut-off Date and to Mortgage Loan 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.
<PAGE>
MLMI 1998-C2
Exhibit VI
Merrill Lynch
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Loan Amount Balance Defeasance
- ------- ------------- ------------- ----------- ------------ ----------
<S> <C> <C> <C> <C> <C>
125 Cambridge Park Apts Multifamily $ 3,520,000 $ 3,497,970.15 Yes
201 Madison Parke Apartments Multifamily $ 1,400,000 $ 1,397,502.20 Yes
203 Meadow Oaks Apartments Multifamily $ 750,000 $ 748,661.90 Yes
237 Southgate Shopping Center Anchored Retail $11,000,000 $10,958,660.08 Yes
</TABLE>
<PAGE>
MLMI 1998-C2
Exhibit XII
Merrill Lynch
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Loan Amount Balance ARD
- ------- ------------- ------------- ----------- ------------ ---
<S> <C> <C> <C> <C> <C>
104 380/400 Woodview Avenue Industrial $ 2,100,000 $ 2,096,001.55 HyperAm
110 Antioch Ramada Inn Hospitality $ 2,560,000 $ 2,532,591.98 HyperAm
113 Atrium at Chesterfield Office $13,520,000 $13,485,479.70 HyperAm
124 Butler Pike Office Building Office $ 2,100,000 $ 2,096,076.13 HyperAm
126 Canyon Crest Shopping Center Anchored Retail $19,000,000 $18,964,066.65 HyperAm
127 Carlsbad Inn Hospitality $ 4,000,000 $ 3,975,001.18 HyperAm
128 Carlsbad Ramada Inn Hospitality $ 4,020,000 $ 3,976,960.84 HyperAm
146 Comfort Suites - Stafford Hospitality $ 2,000,000 $ 1,990,058.03 HyperAm
161 Dickson Kroger Shopping Center Anchored Retail $ 3,250,000 $ 3,239,282.90 HyperAm
176 Hampton Inn - Greensboro Hospitality $ 4,450,000 $ 4,430,539.87 HyperAm
199 Learwood Square Shopping Center Anchored Retail $ 3,400,000 $ 3,390,166.45 HyperAm
208 Mission Bell Plaza Anchored Retail $ 8,456,250 $ 8,423,864.19 HyperAm
209 Modesto Ramada Inn Hospitality $ 2,720,000 $ 2,690,878.99 HyperAm
214 Office Max Anchored Retail $ 1,800,000 $ 1,796,625.40 HyperAm
245 Vallejo Ramada Inn Hospitality $ 2,170,000 $ 2,146,767.41 HyperAm
</TABLE>
<PAGE>
MLMI 1998-C2
Exhibit XXX
Merrill Lynch
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Loan Amount Balance
------- ------------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
137 Chelsea Mini Storage Industrial $16,200,000 $16,047,887.96
</TABLE>
<PAGE>
MLMI 1998-C2
Exhibit XLIII (A)
Merrill Lynch
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Loan Amount Balance
------- ------------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
105 518 Raymond Avenue Multifamily $ 1,023,900.59 $ 1,030,000
106 524 Raymond Avenue Multifamily $ 1,033,841.40 $ 1,040,000
110 Antioch Ramada Inn Hospitality $ 2,532,591.98 $ 2,560,000
112 Arbor Oaks Apartments Multifamily $ 2,992,591.28 $ 3,000,000
118 Best Western - Pearl Hospitality $ 1,691,212.92 $ 1,700,000
119 Best Western Anahiem Hills Hospitality $ 2,155,295.52 $ 2,160,000
128 Carlsbad Ramada Inn Hospitality $ 3,976,960.84 $ 4,020,000
130 Cedars Apartments Multifamily $ 2,245,651.49 $ 2,250,000
143 Comfort Inn - Vicksburg Hospitality $ 2,188,628.49 $ 2,200,000
144 Comfort Inn Jackson Hospitality $ 2,576,612.61 $ 2,590,000
145 Comfort Inn Ruston Hospitality $ 2,089,145.37 $ 2,100,000
151 Courts at West University Multifamily $ 2,990,545.17 $ 3,000,000
155 Days Inn Hospitality $ 1,739,206.15 $ 1,750,000
163 Econo Lodge Hospitality $ 2,087,047.40 $ 2,100,000
168 Forest Park Apartment Multifamily $ 3,593,126.90 $ 3,600,000
177 Hampton Inn - Newnan Hospitality $ 3,744,081.85 $ 3,780,000
178 Hampton Inn Peachtree Hospitality $ 2,467,089.43 $ 2,500,000
179 Harvey's Racquet Club Apts Multifamily $ 6,262,958.36 $ 6,310,000
191 Hub Apartments Multifamily $ 6,932,926.25 $ 6,985,000
196 Lake Shore Park Apartments Multifamily $ 8,257,688.50 $ 8,300,000
201 Madison Parke Apartments Multifamily $ 1,397,502.20 $ 1,400,000
203 Meadow Oaks Apartments Multifamily $ 748,661.90 $ 750,000
209 Modesto Ramada Inn Hospitality $ 2,690,878.99 $ 2,720,000
216 Park Apartments Multifamily $ 3,761,745.18 $ 3,790,000
217 Park Place Apartments Multifamily $ 2,909,404.44 $ 2,915,000
227 Roadway Inn - Killeen Hospitality $ 1,081,105.78 $ 1,085,000
233 Sheraton Bangor International Airport Hospitality $ 3,089,850.80 $ 3,100,000
236 South Oak & Taylor Oak Apts. Multifamily $ 1,896,396.97 $ 1,900,000
238 Spring Lake Apartments Multifamily $ 3,371,455.91 $ 3,380,000
239 Spring Lake Lakehomes Multifamily $ 2,334,172.92 $ 2,340,000
245 Vallejo Ramada Inn Hospitality $ 2,146,767.41 $ 2,170,000
246 Valley View Apartments (Chud) Multifamily $10,247,492.97 $10,300,000
</TABLE>
Control
Number Affiliation
------- -----------
105 524 Raymond
106 518 Raymond
110 SORA - Carlsbad Ramada, Modesto Ramada, Vallejo Ramada
112 MIP - Courts of West
118 BM - Comfort Inn Vicksburg, Comfort Inn Jackson, Comfort I
119 Best Western
128 SORO - Antioch Ramada, Modesto Ramada, Vallejo Ramada
130 Park Place Apts
143 BM - Best Western Pearl, Comfort Inn Jackson, Comfort Inn
144 BM - Best Western Pearl, Comfort Inn Vicksburg, Comfort In
145 BM - Best Western Pearl, Comfort Inn Vicksburg, Comfort In
151 MIP - Arbor Oaks
155 NATU - Econo Lodge
163 NATU - Days Inn
168 Mahone - South Oak & Taylor
177 Hampton Inn - Peachtree (#45)
178 Hampton Inn - Newnan (#44)
179 JF-Hub Apartments and JF-Park Apartment
191 JF-Harvey's Raquet Club Apartments and JF-The Park Apartme
196 Chud - Valley View Apartments
201 ROB - Meadow Oaks Apartments
203 ROB - Madison Parke Apartments
209 SORA - Antioch Ramada, Carlsbad Ramada, Vallejo Ramada
216 JF-Harvey's Raquet Club Apartments and JF-The Hub Apartmen
217 Cedars Apts
227 Roadway Inn
233 Sheraton
236 Mahone - Forest Park
238 COP - Spring Lake Lakehomes
239 COP - Spring Lake Apartments
245 SORA - Antioch Ramada, Carlsbad Ramada, Modesto Ramada
246 Chud - Lake Shore Park Apartments
<PAGE>
MLMI 1998-C2
Exhibit II-XIII
Merrill Lynch
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Loan Amount Balance Leasehold
- ------- ------------- ------------- ----------- ------------ ---------
<S> <C> <C> <C> <C> <C>
118 Best Western - Pearl Hospitality $1,691,212.92 $1,700,000 Yes
119 Best Western Anahiem Hills Hospitality $2,155,295.52 $2,160,000 Yes
233 Sheraton Bangor International Airport Hospitality $3,089,850.80 $3,100,000 Yes
</TABLE>
<PAGE>
MLMI 1998-C2
Schedule II
Merrill Lynch
<TABLE>
<CAPTION>
Control Original Cut-Off Date
Number Property Name Property Type Loan Amount Balance Leasehold
- ------- ------------- ------------- ----------- ------------ ---------
<S> <C> <C> <C> <C> <C>
118 Best Western - Pearl Hospitality $1,691,212.92 $1,700,000 Yes
119 Best Western Anahiem Hills Hospitality $2,155,295.52 $2,160,000 Yes
233 Sheraton Bangor International Airport Hospitality $3,089,850.80 $3,100,000 Yes
</TABLE>
1998-C2
Daiwa Finance Corp.
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement, dated as of March 1, 1998 (the
"Agreement"), is between Merrill Lynch Mortgage Investors, Inc., a Delaware
corporation (the "Company"), and Daiwa Finance Corp., a New York corporation
(the "Mortgage Loan Seller"). The Mortgage Loan Seller agrees to sell, and the
Company agrees to purchase, the mortgage loans (the "Mortgage Loans") described
in, and set forth in, the Mortgage Loan Schedule attached as Exhibit A to this
Agreement (the "Mortgage Loan Schedule"). The Company intends to deposit the
Mortgage Loans and other assets into a trust (the "Trust") and cause the
creation of a series of certificates to be known as Merrill Lynch Mortgage
Investors, Inc., Mortgage Pass-Through Certificates, Series 1998-C2 (the
"Certificates"), evidencing beneficial ownership interests in the Mortgage Loans
and other assets (including, without limitation, other mortgage loans), under a
Pooling and Servicing Agreement, to be dated as of March 1, 1998 (the "Pooling
and Servicing Agreement"), among the Company, as depositor, First Union National
Bank, as master servicer (the "Servicer"), CRIIMI MAE Services Limited
Partnership, as special servicer (the "Special Servicer"), and Norwest Bank
Minnesota, National Association, as trustee (the "Trustee"). Capitalized terms
used but not otherwise defined herein shall have the respective meanings given
to them in the Pooling and Servicing Agreement without giving effect to any
amendment thereto unless the Mortgage Loan Seller has given its consent to such
amendment in writing and signed by a duly authorized officer of the Mortgage
Loan Seller.
1. Purchase Price; Purchase and Sale. The purchase price (the "Purchase
Price") for the Mortgage Loans shall consist of a cash amount equal to (i) 100%
of the outstanding principal balance of the Mortgage Loans as of the Cut-Off
Date plus (ii) interest accrued on the Mortgage Loans at the related Mortgage
Rate up to but excluding the Closing Date. The Purchase Price amount shall be
payable by the Company to the Mortgage Loan Seller on March 27, 1998 or such
other date as shall be mutually acceptable to the parties hereto (the "Closing
Date") in immediately available funds. The closing for the purchase and sale of
the Mortgage Loans shall take place at the offices of Willkie Farr & Gallagher,
153 East 53rd Street, New York, New York 10022, at 10:00 a.m. (New York time),
on the Closing Date.
On the Closing Date, the Mortgage Loan Seller shall sell, transfer, assign,
set over and convey to the Company, without recourse, and the Company shall
purchase, all the right, title and interest of the Mortgage Loan Seller in and
to the Mortgage Loans, including all interest and principal due on or with
respect to the Mortgage Loans after the Cut-Off Date, together with all of the
Mortgage Loan Seller's right, title and interest in and to the proceeds of any
related title, hazard, primary mortgage or other insurance policies. All
scheduled payments of interest and principal due before the Cut-Off Date
<PAGE>
but collected on or after the Cut-Off Date, and recoveries of interest and
principal collected before the Cut-Off Date, shall belong to, and be promptly
remitted to the Mortgage Loan Seller. The Company hereby directs the Mortgage
Loan Seller, and the Mortgage Loan Seller hereby agrees, to deliver to each of
the Trustee, the Master Servicer and the Special Servicer all documents,
instruments and agreements required to be delivered by the Company to the
Trustee, the Master Servicer and the Special Servicer under Section 2.01 of the
Pooling and Servicing Agreement, and meeting all the requirements of such
Section 2.01 and such other documents, instruments and agreements as the Company
or the Trustee, the Master Servicer and the Special Servicer shall reasonably
request. The Mortgage Loan Schedule may be amended to reflect the actual
Mortgage Loans.
2. Representations and Warranties. (a) The Mortgage Loan Seller hereby
represents and warrants to the Company as of the date hereof and as of Closing
Date that:
(i) The Mortgage Loan Seller is a New York corporation duly organized,
validly existing and in good standing under the laws of the State of New
York, with the necessary corporate power and authority to own its assets
and conduct its business as now being conducted, is duly qualified as a
foreign corporation in good standing in all jurisdictions in which the
ownership or lease of its property or the conduct of its business requires
such qualification, except where the failure to be so qualified would not
have a material adverse effect on the value of the Mortgage Loans and the
ability of the Mortgage Loan Seller to perform its obligations hereunder,
and the Mortgage Loan Seller has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement by it,
and has the necessary corporate power and authority to execute, deliver and
perform this Agreement and all the transactions contemplated hereby,
including, but not limited to, the power and authority to sell, assign,
transfer, set over and convey the Mortgage Loans in accordance with this
Agreement;
(ii) This Agreement has been duly authorized, executed and delivered by the
Mortgage Loan Seller and assuming the due authorization, execution and
delivery by the Company, will constitute a legal, valid and binding
obligation of the Mortgage Loan Seller, enforceable against the Mortgage
Loan Seller in accordance with the terms of this Agreement, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the
-2-
<PAGE>
enforcement of creditors' rights generally, and by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law), 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 Mortgage Loan
Seller and the performance of its obligations hereunder (1) will not
conflict with any provision of any law or regulation to which the Mortgage
Loan Seller is subject, or conflict with, result in a breach of or
constitute a default under any of the terms, conditions or provisions of
any of the Mortgage Loan Seller's organizational documents or any agreement
or instrument to which the Mortgage Loan Seller is a party or by which it
is bound, or any order or decree applicable to the Mortgage Loan Seller, or
result in the creation or imposition of any lien on any of the Mortgage
Loan Seller's assets or property, in each case which would materially and
adversely affect the ability of the Mortgage Loan Seller to carry out the
transactions contemplated by this Agreement; and (2) does not require the
consent of any third party or such consent has been obtained.
(iv) There is no action, suit, proceeding or investigation pending or, to
the knowledge of the Mortgage Loan Seller, threatened against the Mortgage
Loan Seller in any court or by or before any other governmental agency or
instrumentality which, in the Mortgage Loan Seller's good faith and
reasonable judgment, would materially and adversely affect the validity of
the Mortgage Loans or the ability of the Mortgage Loan Seller to enter
into, or which would be likely to impair materially and adversely the
ability of the Mortgage Loan Seller to carry out the transactions
contemplated by, this Agreement;
(v) The Mortgage Loan Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have
consequences that, in the Mortgage Loan Seller's good faith and reasonable
judgment, would materially and adversely affect the condition (financial or
other) or operations
-3-
<PAGE>
of the Mortgage Loan Seller or its properties or might have consequences
that would materially and adversely affect its performance hereunder;
(vi) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Mortgage Loan Seller of or compliance by the Mortgage
Loan Seller with this Agreement or the consummation of the transactions
contemplated by this Agreement, other than those which have been obtained
by the Mortgage Loan Seller;
(vii) The transfer, assignment and conveyance of the Mortgage Loans by the
Mortgage Loan Seller to the Company is not subject to bulk transfer laws or
any similar statutory provisions in effect in any applicable jurisdiction;
and
(viii) Under generally accepted accounting principles ("GAAP") and for
federal income tax purposes, the Mortgage Loan Seller will report the
transfer of the Mortgage Loans to the Company as a sale of the Mortgage
Loans to the Company. The consideration received by the Mortgage Loan
Seller upon the sale of the Mortgage Loans to the Company will constitute
reasonably equivalent value and fair consideration for the Mortgage Loans.
The Mortgage Loan Seller will be solvent at all relevant times prior to,
and will not be rendered insolvent by, the sale of the Mortgage Loans to
the Company. The Mortgage Loan Seller is not selling the Mortgage Loans to
the Company with any intent to hinder, delay or defraud any of the
creditors of the Mortgage Loan Seller.
(b) The Mortgage Loan Seller hereby makes the representations and
warranties contained Schedule I, Schedule II and Schedule III with respect to
each Mortgage Loan as of the date specified therein or, if no such date is
specified, as of the Closing Date.
3. Notice of Breach; Cure and Repurchase.
(a) Pursuant to the Pooling and Servicing Agreement, the Mortgage Loan
Seller and the Company shall be given notice of any Breach or Document Defect
that materially and adversely affects the value of such Mortgage Loan or the
interests of the holders of the Certificates therein.
(b) Upon notice pursuant to Section 3(a) herein, the Mortgage Loan Seller
shall, not later than 90 days from the Mortgage Loan Seller's receipt of notice
of such Breach or
-4-
<PAGE>
Document Defect (or, in the case of a Document Defect or Breach relating to a
Mortgage Loan not being a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Internal Revenue Code of 1986, as amended (a "Qualified
Mortgage"), not later than 90 days of any party to this Agreement or to the
Pooling and Servicing Agreement discovering such Document Defect or Breach), if
such Breach or Document Defect shall materially and adversely affect the value
of such Mortgage Loan or the interests of the holders of the Certificates
therein, cure such Document Defect or Breach, as the case may be, in all
material respects or, if such Document Defect or Breach (other than omissions
solely due to a document not having been returned by the related recording
office) cannot be cured within the periods hereinafter set forth, repurchase the
affected Mortgage Loan at the applicable Repurchase Price (as defined below);
provided, however, that if such Document Defect or Breach is capable of being
cured but not within such 90-day period, such Document Defect or Breach does not
relate to any Mortgage Loan not being treated as a Qualified Mortgage, and the
Mortgage Loan Seller has commenced and is diligently proceeding with the cure of
such Document Defect or Breach within such 90-day period, the Mortgage Loan
Seller shall (A) with respect to any Breach, have an additional 90-day period to
complete such cure (or failing such cure, to complete such repurchase) and (B)
with respect to any Document Defect, have additional 90-day periods up to but
not exceeding the second anniversary of the Closing Date to complete such cure
(or failing such cure, to complete such repurchase); provided, further, that
with respect to each additional 90-day period, the 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 or additional 90-day period, as applicable, and what actions the
Mortgage Loan Seller is pursuing in connection with the cure thereof and stating
that the Mortgage Loan Seller anticipates that such Document Defect or Breach
will be cured within such additional 90-day period. If the affected Mortgage
Loan is to be repurchased, Mortgage Loan Seller shall remit the Repurchase Price
in immediately available funds to the Trustee. The delivery of a binding
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.
The "Repurchase Price" with respect to any Mortgage Loan or REO Loan to be
repurchased pursuant to this Agreement and Section 2.03 of the Pooling and
Servicing Agreement, shall have the meaning given to the term "Purchase Price"
in the Pooling and Servicing Agreement without giving effect to any amendment
thereto unless the Mortgage Loan Seller has given its consent to such amendment
in writing and signed by a duly authorized officer of the Mortgage Loan Seller.
-5-
<PAGE>
(c) Upon any repurchase of a Mortgage Loan contemplated by Section 3(b)
above, the Trustee, the Servicer and the Special Servicer shall each tender to
the Mortgage Loan Seller, all portions of the Mortgage File and other documents
pertaining to such Mortgage Loan possessed by it, and each document that
constitutes a part of the Mortgage File that was endorsed or assigned to the
Trustee shall be endorsed or assigned, as the case may be, to the Mortgage Loan
Seller.
(d) This Section 3 of this Agreement provides the sole and exclusive remedy
available to the Company, the Trustee, the Certificateholders, or the Trustee on
behalf of the Certificateholders or any other party, respecting any Document
Defect or any Breach.
(e) Subject to the terms of this Agreement, the Mortgage Loan Seller hereby
acknowledges the assignment by the Company to the Trustee, as trustee under the
Pooling and Servicing Agreement, for the benefit of the Certificateholders, of
the representations and warranties contained herein and of the obligation of the
Mortgage Loan Seller to repurchase a Mortgage Loan pursuant to this Section. The
Trustee or its designee may enforce such obligations as provided in Section 8
hereof.
4. Representations, Warranties and Agreements of Company.
(a) The Company hereby represents and warrants to the Mortgage Loan Seller,
as of the date hereof (or such other date as is specified in the related
representation or warranty), as follows:
(i) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, with full corporate
power and authority to own its assets and conduct its business, is duly
qualified as a foreign corporation in good standing in all jurisdictions in
which the ownership or lease of its property or the conduct of its business
requires such qualification, except where the failure to be so qualified
would not have a material adverse effect on the ability of the Company to
perform its obligations hereunder, and the Company has taken all necessary
action to authorize the execution, delivery and performance of this
Agreement by it, and has the power and authority to execute, deliver and
perform this Agreement and all the transactions contemplated hereby;
(ii) This Agreement has been duly authorized, executed and delivered by the
Company and constitutes a valid and binding obligation of the
-6-
<PAGE>
Company, enforceable against the Company in accordance with its terms,
except as such enforcement may be limited by bankruptcy, reorganization,
insolvency, moratorium and other similar laws affecting the enforcement of
creditors' rights generally and to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity or
at law);
(iii) The execution and delivery of this Agreement by the Company and the
performance of its obligations hereunder will not conflict with any
provision of any law or regulation to which the Company is subject, or
conflict with, result in a breach of or constitute a default under any of
the terms, conditions or provisions of any of the Company's organizational
documents or any agreement or instrument to which the Company is a party or
by which it is bound, or any law, rule, regulation, judgment, writ,
injunction, order or decree applicable to the Company, or result in the
creation or imposition of any lien on any of the Company's assets or
property, in each case which would materially and adversely affect the
ability of the Company to carry out the transactions contemplated by this
Agreement;
(iv) There is no action, suit, proceeding or investigation pending or to
the knowledge of the Company, threatened against the Company in any court
or by or before any other governmental agency or instrumentality which
would materially and adversely affect the validity of this Agreement or any
action taken in connection with the obligations of the Company contemplated
herein, or which would be likely to impair materially the ability of the
Company to perform under the terms of this Agreement;
(v) The Company is not in default with respect to any order or decree of
any court or any order, regulation or demand of any federal, state,
municipal or governmental agency, which default might have consequences
that would materially and adversely affect the condition (financial or
other) or operations of the Company or its properties or might have
consequences that would materially and adversely affect its performance
hereunder;
-7-
<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 Company of or compliance by the Company with this
Agreement or the consummation of the transactions contemplated by this
Agreement other than those that have been obtained by the Company; and
(vii) Under GAAP and for federal income tax purposes, the Company will
report the transfer of the Mortgage Loans by the Mortgage Loan Seller to
the Company as a sale of the Mortgage Loans to the Company.
5. Company's Conditions to Closing.
The obligations of the Company under this Agreement shall be subject to the
satisfaction, on the Closing Date, or such other date specified herein, of the
following conditions:
(a) The obligations of the Mortgage Loan Seller required to be performed by
it at or prior to the Closing Date pursuant to the terms of this Agreement shall
have been duly performed and complied with and all of the representations and
warranties of the Mortgage Loan Seller under this Agreement shall be true and
correct in all material respects, and no event shall have occurred which, with
notice or the passage of time, or both, would constitute a material default
under this Agreement.
(b) The Company or its designee shall have received all of the following
closing documents, in such forms as are agreed upon and acceptable to the
Company and in form and substance satisfactory to the Company, the Underwriters
and their respective counsel, duly executed by all signatories other than the
Company as required pursuant to the respective terms thereof:
(i) with respect to each Mortgage Loan, the related Mortgage File, which
Mortgage Files shall be delivered to and held by the Trustee on behalf of
the Company;
(ii) the final Mortgage Loan Schedule;
(iii) an officer's certificate from the Mortgage Loan Seller dated as of
the Closing Date, in the form attached hereto as Exhibit B;
(iv) an opinion of Mortgage Loan Seller's counsel, subject to customary
exceptions and carve-outs, in form and substance reasonably acceptable to
the Company and its counsel and the Rating Agencies, which states in
substance the opinions set forth on Exhibit C hereto; and
-8-
<PAGE>
(v) such other documents, certificates and opinions as the Company may
reasonably request to effectuate the transactions contemplated by this
Agreement.
(c) The Mortgage Loan Seller hereby agrees to furnish such other
information, documents, certificates, letters or opinions with respect to the
Mortgage Loans or itself as may be reasonably requested by the Company in order
for the Company to perform any of its obligations or satisfy any of the
conditions on its part to be performed or satisfied pursuant to the Underwriting
Agreement, the Pooling and Servicing Agreement or this Agreement.
6. Indemnification and Contribution.
(a) The Mortgage Loan Seller shall indemnify and hold harmless the Company,
the Underwriter, their respective officers and directors, and each person, if
any, who controls the Company or the Underwriter within the meaning of either
Section 15 of the Securities Act of 1933, as amended (the "1933 Act") or Section
20 of the Securities Exchange Act of 1934, as amended (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) (i) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact relating to the Mortgage Loans, the related
Mortgagors, the related Mortgaged Properties or the Mortgage Loan Seller
contained in (A) the Prospectus Supplement and the Memorandum (insofar as the
following are incorporated as part of the Memorandum) under the headings
"Summary of the Prospectus Supplement-The Mortgage Pool" or "Summary of the
Prospectus Supplement-Mortgage Loan Sellers", "Risk Factors-The Mortgage Loans"
and "Description of the Mortgage Pool" and on Annex A to the Prospectus
Supplement, the Diskette or, insofar as they are required to be filed as part of
the Registration Statement pursuant to the No-Action Letters, any Computational
Materials or ABS Term Sheets with respect to the Registered Certificates, or in
any revision or amendment of or supplement to any of the foregoing or (B) any
items similar to Computational Materials and ABS Term Sheets forwarded to
prospective investors in the Non-Registered Certificates, or (ii) arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
but, in the case of (i) and (ii), only if and to the extent that any such untrue
statement or alleged untrue statement or omission or alleged omission (I) arises
out of or is based upon an untrue statement or omission with respect to the
Mortgage Loans, the related Mortgagors or the related Mortgaged Properties
contained in the Master Tape (it being
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<PAGE>
herein acknowledged that the Master Tape was used to prepare the Prospectus
Supplement including without limitation Annex A thereto, the Memorandum, the
Diskette, the Computational Materials and ABS Term Sheets with respect to the
Registered Certificates and any items similar to Computational Materials and ABS
Term Sheets forwarded to prospective investors in the Non-Registered
Certificates), (II) is contained in the information regarding the Mortgage
Loans, the related Mortgagor, the related Mortgaged Property or the Mortgage
Loan Seller set forth in the Prospectus Supplement and the Memorandum (insofar
as the following are incorporated as part of the Memorandum) under the headings
"Summary of the Prospectus Supplement-The Mortgage Pool" or "Summary of the
Prospectus Supplement-Mortgage Loan Sellers", "Risk Factors-The Mortgage Loans"
and "Description of the Mortgage Pool" or on Annex A to the Prospectus
Supplement; provided that the foregoing were provided to the Mortgage Loan
Seller for its review, or (III) arises out of or is based upon a breach of the
representations and warranties of the Mortgage Loan Seller set forth in or made
pursuant to Section 2 (such representations and warranties, together with the
information described in the preceding clauses I and II, the "Mortgage Loan
Seller Information"); provided that the indemnification provided by this Section
6 shall not apply to the extent that such untrue statement or omission was made
as a result of an error in (x) the manipulation of, or (y) any calculations
based upon, or (z) any aggregation (other than an aggregation made in the Master
Tape by the Mortgage Loan Seller) of, the information regarding the Mortgage
Loans, the related Mortgagor, the related Mortgaged Property or the Mortgage
Loan Seller set forth in the Master Tape and Annex A to the Prospectus
Supplement, including without limitation the aggregation of such information
with comparable information relating to the mortgage loans conveyed to the Trust
Fund by Merrill Lynch Mortgage Capital Inc. and Daiwa Real Estate Finance Corp.
(the "Other Mortgage Loans"). This indemnity agreement will be in addition to
any liability which the Mortgage Loan Seller may otherwise have.
For purposes of this Agreement, "Registration Statement" shall mean the
registration statement No. 333-38073 filed by the Company on Form S-3, including
without limitation exhibits thereto and information incorporated therein by
reference; "Prospectus" shall mean the prospectus dated February 25, 1998, as
supplemented by the prospectus supplement dated March 24, 1998 (the "Prospectus
Supplement"), relating to the Registered Certificates, including all annexes
thereto; "Memorandum" shall mean the private placement memorandum dated March
27, 1998, relating to the Non-Registered Certificates; "Registered Certificates"
shall mean the Class A-1, Class A-2, Class B, Class C, Class D, Class E and
Class IO Certificates; "Non-Registered Certificates" shall mean the Certificates
other than the Registered Certificates; "Computational Materials" shall have the
meaning assigned thereto in the no-action letter dated May 20, 1994 issued by
the Division of Corporation Finance of the Securities and Exchange Commission
(the "Commission") to Kidder,
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<PAGE>
Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated, and Kidder
Structured Asset Corporation and the no-action letter dated May 27, 1994 issued
by the Division of Corporation Finance of the Commission to the Public
Securities Association (together, the "Kidder Letters"); "ABS Term Sheets" shall
have the meaning assigned thereto in the no-action letter dated February 17,
1995 issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (the "PSA Letter" and, together with the Kidder
letters, the "No-Action Letters"); "Diskette" shall mean the diskette attached
to each of the Prospectus and the Memorandum; and "Master Tape" shall mean the
compilation of information and data regarding the Other Mortgage Loans and the
Mortgage Loans covered by the Independent Accountants' Report on Applying
Agreed-Upon Procedures dated March 24, 1998 and rendered by Deloitte & Touche
LLP (a "hard copy" of which Master Tape was initialed on behalf of the Mortgage
Loan Seller and the Company).
(b) Promptly after receipt by an indemnified party under this Section 6 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 6, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve the
indemnifying party from any liability which it may have to any indemnified party
under this Section 6, except to the extent that it has been prejudiced in any
material respect, or from any liability which it may have, otherwise than under
this Section 6. 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 reasonably satisfactory to such indemnified party;
provided 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 which are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying party
to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party for legal or other expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the
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<PAGE>
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with one local counsel, if applicable), approved by
the Company representing the indemnified parties under subsection (a) of this
Section 6 who are parties to such action), (ii) the indemnifying party shall not
have employed counsel reasonably 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 in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(c) If the indemnification provided for in this Section 6 shall for any
reason be unavailable in accordance with its terms to an indemnified party under
this Section 6, then the Mortgage Loan Seller and the Company shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or (b)
above, in such proportion as is appropriate to reflect the relative fault of the
Mortgage Loan Seller on the one hand and the Company on the other in connection
with the statement or omission that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Mortgage Loan Seller or the Company and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The Mortgage Loan Seller and the Company agree that it
would not be just and equitable if contribution pursuant to this subsection (d)
were to be determined by per capita allocation or by any other method of
allocation that does not take account of the equitable considerations referred
to herein. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
against any action or claim which is the subject of this subsection (d) subject
to the limitations therein provided under subsection (c). No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not also guilty of
such fraudulent misrepresentation.
7. Notices. All communications hereunder shall be in writing and effective
only upon receipt and, if sent to the Company, will be mailed, hand delivered,
couriered or sent by facsimile transmission to it at World Financial Center, New
York, New York 10281, attention: Bruce L. Ackerman fax number: (212)
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<PAGE>
449-7684, or, if sent to the Mortgage Loan Seller, will be mailed, hand
delivered, couriered or sent by facsimile transmission to it at Financial
Square, 32 Old Slip, New York, New York 10005-3538, attention: Samuel Kirschner,
fax number: (212) 612-6976, with a copy to the attention of the General Counsel,
fax number: (212) 612-7155.
8. Trust as Beneficiary. The representations, warranties and agreements
made by the Mortgage Loan Seller in this Agreement are made for the benefit of,
and, to the extent they are assigned by the Company to the Trustee under the
Pooling and Servicing Agreement, may be enforced by or on behalf of, the
Trustee, the Servicer or the Special Servicer, as provided in the Pooling and
Servicing Agreement, to the same extent that the Company has rights against the
Mortgage Loan Seller under this Agreement in respect of representations,
warranties and agreements made by the Mortgage Loan Seller herein.
9. Miscellaneous. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES. This Agreement may be executed in any number of
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall together constitute but one and the same instrument. This
Agreement will inure to the benefit of and be binding upon the parties hereto
and their respective successors and assigns, and no other person will have any
right or obligation hereunder, other than as provided herein.
10. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement, or in
certificates of officers of the Mortgage Loan Seller and the Company submitted
pursuant hereto, shall remain operative and in full force and effect and shall
survive the transfer and sale of the Mortgage Loans to the Company and by the
Company to the Trustee notwithstanding any language to the contrary contained in
any endorsement of any Mortgage Loan; provided that the representations,
warranties and agreements shall terminate upon the termination of the Pooling
and Servicing Agreement.
11. Severability. If any provision of this Agreement shall be prohibited or
invalid under applicable law, this Agreement shall be ineffective only to such
extent, without invalidating the remainder of this Agreement.
12. Further Assurances. The Mortgage Loan Seller and the Company agree to
execute and deliver such instruments and take such actions as the other party
may, from time to time, reasonably request in order to effectuate the purpose
and to carry out the terms of this Agreement.
13. Amendments. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated except by
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<PAGE>
a writing signed by a duly authorized officer of the party against whom
enforcement of such change, waiver, discharge or termination is sought to be
enforced. This Agreement may not be changed or waived in any manner which would
have a material adverse effect on Certificateholders without the prior written
consent of the Trustee.
[Signature page follows]
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<PAGE>
IN WITNESS WHEREOF, the Company and the Mortgage Loan Seller have caused
this Agreement to be duly executed by their respective officers as of the day
and year first above written.
DAIWA FINANCE CORP.
By: /s/ HIROKI NOMURA
----------------------------------------
Name: Hiroki Nomura
Title: Authorized Signatory
MERRILL LYNCH MORTGAGE INVESTORS, INC.
By: /s/ BRUCE ACKERMAN
----------------------------------------
Name: Bruce Ackerman
Title: Authorized Signatory
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
A-1
<PAGE>
<TABLE>
<CAPTION>
Daiwa Finance
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
300 Spring Branch Estates Apartments 7901 Ameilia Road Houston TX 77055
301 Holiday Inn Cortland 2 River Street Cortland NY 13045
302 Stoney Fields Estates 1059 Ocean Heights Avenue Egg Harbor Township NJ 08234
303 Waters Edge Apartments 394 Ocean Avenue Revere MA 02151
304 Northgate Distribution Center 1000 - 1200 Williams Drive Marietta GA 30066
305 Ebbets Field Apartments 1672-1726 Bedford Avenue Brooklyn NY 11225
306 The Grand Hotel 1045 Beach Drive Cape May NJ 08204
307 Windrush Apartments 4322 Kostoryz Road Corpus Christi TX 78415
308 Woodbury Place Apartments 802 Barry Street Corpus Christi TX 78411
309 Promenade Shopping Center -
Palm Beach Gardens 9810 - 9930 North Alternate A-1A Palm Beach Gardens FL 33408
310 Ramada Inn Foothills 6944 East Tanque Verde Road Tucson AZ 85715
311 Days Inn Coliseum 2420 West Thomas Road Phoenix AZ 85015
312 Ramada Inn - Bordentown 1083 Route 206 Bordentown NJ 08505
313 Comfort Inn - Maingate 7571 W. Irlo Bronson Memorial Highway Kissimmee FL 34747
315 Southwood Square Shopping Center 2826-2850 South Main High Point NC 27263
316 Rockledge Apartments 2505 Verde Drive Colorado Springs CO 80910
317 Carmel Apartments 2010 Carmel Drive Colorado Springs CO 80910
318 Napa Town Center 1290 Napa Town Center Napa CA 95449
319 Days Inn Busch Gardens 2901 E. Busch Blvd Tampa FL 33612
320 Mill Village 365 Boston Post Road (Route 20) Sudbury MA 01776
321 Cedar Professional Building 204 Worcester Road Wellesley MA 02181
322 South Water Street 5 South Water Street Nantucket MA 02554
323 Wellesley Marketplace 239-251 Washington Street Wellesley MA 02181
328 The Majestic Hotel 1500 Sutter Street San Francisco CA 94109
330 Days Inn - Fort Lauderdale 1595 West Oakland Park Blvd. Fort Lauderdale FL 33311
331 Timmons Place & Timmons Square 3637 & 3701 West Alabama Houston TX 77027
332 Shops at Fairlane Meadows 15901 - 16301 Ford Road Dearborn MI 48126
333 Palm Glen Shopping Center 3501-3627 West Glendale Avenue Phoenix AZ 85051
334 Fairway Shopping Center 5859 West Indian School Road Phoenix AZ 85031
335 University Park Plaza 3350 South University Drive Davie FL 33328
336 Timbers North Apartments 2201 North 14th Street Ponca City OK 74602
337 Corporate Center at Beaumeade 44633 & 44645 Guilford Drive,
21641 Beaumede Circle Ashburn VA 22011
338 The Village Mall Shopping Center 4907 West 10th Street Great Bend KS 67530
340 First Hill Medical Building 515 & 525 Minor Avenue Seattle WA 98104
341 Promenade Shopping Center -
Highlands Ranch, Colorado 2660 - 2690 East County Line Road Highlands Ranch CO 80126
535 Atrium Apartments 3401 Northwest 3rd Avenue Pompano Beach FL 33064
536 Fort Williams Square Shopping Center 1351-1389 Fort Williams Street Sylacuaga AL 35150
342 Plaza Terrace Apartments 1307 thru 1701 Plaza, 35th,
and Murdock Road Charlotte NC 28205
343 136 West 71st Street 136 West 71st Street New York NY 10023
344 Pines Apartments 2125 Stardust Court Alamogordo NM 88310
345 Golden Arms Apartments 1400 Utah Street Golden CO 80401
346 Le Chateau Apartments 3144 Chateau Boulevard East Point GA 30344
347 Pacific Cove Apartments 3619 East Monterosa Street Phoenix AZ 85018
348 Albany Avenue 601 Albany Avenue Brooklyn NY 11203
349 Broadway Inn Apartments 8477 East Broadway Boulevard Tucson AZ 85710
350 Shawnee Garden Apartments 6013 King Street Shawnee KS 66203
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------ MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
300 2,048,228.94 16,900.70 8.710 75 292 06/05/2004 No Balloon
301 2,646,054.15 24,261.00 9.740 111 267 06/01/2007 No Balloon
302 1,599,659.70 13,610.43 9.090 112 292 07/01/2007 No Balloon
303 4,664,962.19 37,277.27 8.320 112 292 07/01/2007 No Balloon
304 4,678,099.18 38,947.22 8.820 112 292 07/01/2007 No Balloon
305 17,638,089.49 144,245.97 8.610 113 293 08/01/2007 No Balloon
306 8,440,020.39 75,997.49 9.345 114 258 09/01/2007 No Balloon
307 3,719,057.45 26,218.04 7.540 114 354 09/01/2007 No Balloon
308 7,438,114.91 52,436.08 7.540 114 354 09/01/2007 No Balloon
309 15,240,668.96 112,052.73 7.980 114 354 09/01/2007 No Balloon
310 3,777,705.12 31,692.04 8.620 115 271 10/01/2007 No Balloon
311 4,672,424.76 39,198.05 8.620 115 271 10/01/2007 No Balloon
312 3,594,409.38 29,934.45 8.530 115 271 10/01/2007 No Balloon
313 7,158,865.85 60,907.05 8.800 115 271 10/01/2007 No Balloon
315 3,579,158.32 28,697.64 8.380 114 294 09/01/2007 No Balloon
316 5,882,520.95 41,455.85 7.550 116 356 11/01/2007 No Balloon
317 1,495,556.19 10,539.62 7.550 116 356 11/01/2007 No Balloon
318 6,470,703.66 48,564.17 7.625 116 296 11/01/2007 No Balloon
319 3,930,804.82 32,267.27 8.360 116 272 11/01/2007 No Balloon
320 2,688,338.01 20,642.67 7.890 116 296 11/01/2007 No Balloon
321 1,458,569.55 11,104.07 7.790 116 296 11/01/2007 No Balloon
322 2,588,587.61 19,706.88 7.790 116 296 11/01/2007 No Balloon
323 1,792,099.13 13,643.22 7.790 116 296 11/01/2007 No Balloon
328 5,684,840.47 46,376.33 8.310 82 274 01/01/2005 No Balloon
330 2,736,636.29 22,464.55 8.360 116 272 11/01/2007 No Balloon
331 3,188,784.11 26,309.85 7.770 238 238 01/01/2018 No Fully Amortizing
332 12,769,942.59 96,184.22 8.180 107 348 02/01/2007 No Balloon
333 9,483,916.12 66,490.44 7.510 118 358 01/01/2008 No Balloon
334 947,804.01 7,370.05 8.060 118 298 01/01/2008 No Balloon
335 9,985,952.20 71,917.84 7.790 118 358 01/01/2008 No Balloon
336 548,739.73 4,290.63 8.125 118 298 01/01/2008 No Balloon
337 6,982,306.22 51,274.92 7.400 118 298 01/01/2008 No Balloon
338 2,145,621.25 15,926.95 7.800 118 322 01/01/2008 No Balloon
340 15,838,528.23 112,185.31 7.625 119 359 02/01/2008 No Balloon
341 7,687,935.32 56,502.24 7.420 119 299 02/01/2008 No Balloon
535 788,570.03 5,412.58 7.300 119 359 02/01/2008 No Balloon
536 2,246,537.26 16,832.74 7.640 119 299 02/01/2008 No Balloon
342 1,154,417.30 10,066.75 8.500 237 237 12/01/2017 No Fully Amortizing
343 562,612.58 4,519.26 8.875 69 344 12/01/2003 No Balloon
344 1,039,650.36 8,624.51 9.125 88 328 07/01/2005 No Balloon
345 1,332,586.74 10,820.77 8.875 88 328 07/01/2005 No Balloon
346 464,136.63 4,369.34 8.875 209 209 08/01/2015 No Fully Amortizing
347 510,017.23 4,230.89 9.125 88 328 07/01/2005 No Balloon
348 1,398,810.19 13,822.54 9.625 209 209 08/01/2015 No Fully Amortizing
349 573,070.82 5,154.81 9.500 89 269 08/01/2005 No Balloon
350 587,890.70 5,085.53 9.000 54 270 09/01/2002 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
300 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
301 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
302 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
303 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
304 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
305 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
306 0.095 Daiwa Finance Corp. First Union Yes 30/360
307 0.095 Daiwa Finance Corp. First Union Yes Actual/360
308 0.095 Daiwa Finance Corp. First Union Yes Actual/360
309 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
310 0.095 Daiwa Finance Corp. First Union Yes 30/360
311 0.095 Daiwa Finance Corp. First Union Yes 30/360
312 0.095 Daiwa Finance Corp. First Union Yes Actual/360
313 0.095 Daiwa Finance Corp. First Union Yes 30/360
315 0.160 Daiwa Finance Corp. Collateral Mortgage Actual/360
316 0.095 Daiwa Finance Corp. First Union Yes Actual/360
317 0.095 Daiwa Finance Corp. First Union Yes Actual/360
318 0.095 Daiwa Finance Corp. First Union Yes Actual/360
319 0.095 Daiwa Finance Corp. First Union 30/360
320 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
321 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
322 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
323 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
328 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
330 0.095 Daiwa Finance Corp. First Union 30/360
331 0.095 Daiwa Finance Corp. First Union Yes 30/360
332 0.160 Daiwa Finance Corp. Continental Wingate 30/360
333 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
334 0.160 Daiwa Finance Corp. Continental Wingate Yes Actual/360
335 0.095 Daiwa Finance Corp. First Union 30/360
336 0.095 Daiwa Finance Corp. First Union Actual/360
337 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
338 0.095 Daiwa Finance Corp. First Union Yes Actual/360
340 0.095 Daiwa Finance Corp. First Union Yes 30/360
341 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
535 0.095 Daiwa Finance Corp. First Union Actual/360
536 0.095 Daiwa Finance Corp. First Union Yes Actual/360
342 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
343 0.095 Daiwa Finance Corp. First Union 30/360
344 0.095 Daiwa Finance Corp. First Union 30/360
345 0.095 Daiwa Finance Corp. First Union 30/360
346 0.095 Daiwa Finance Corp. First Union 30/360
347 0.095 Daiwa Finance Corp. First Union 30/360
348 0.095 Daiwa Finance Corp. First Union 30/360
349 0.095 Daiwa Finance Corp. First Union 30/360
350 0.095 Daiwa Finance Corp. First Union 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Daiwa Finance
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
351 Tierra Alegre Apartments 3355 East Fort Lowell Road Tucson AZ 85716
352 2240 University Avenue 2240 University Avenue Bronx NY 10453
353 The Tropicaire Apartments 890 NW 45th Avenue Miami FL 33126
354 Woodland View Apartments 1195 Woodland Avenue Atlanta GA 30329
355 Coronado Heights 3066 North Balboa Avenue Tucson AZ 85705
356 Sheridan Apartments 78 Sheridan Drive Atlanta GA 30305
357 Vista Verde Apartments 3620 Verde Drive Colorado Springs CO 80910
358 Cedar Point Apartments 4411 Cedar Springs Road Dallas TX 75219
359 Hampstead Oaks Apartments 200 Hampstead Avenue Savannah GA 31405
360 Cordova Apartments 900 West Gate Drive Bossier LA 71112
540 New Haven, Westchester,
Willowdale Apartments 4021 & 4217 Hessmer Ave, 3212 Roberta Street Metairie LA 70002
361 Deerwood Apartments 2220 NW 55th Boulevard Gainesville FL 32606
362 Shadyedge, Tudor Court Apartments 810 - 812 South Negley Avenue, 131 Pittsburgh,
Edgewood Avenue Edgewood Borough PA 15232 & 15218
365 Crotona Avenue 2314 - 2318 Crotona Avenue Bronx NY 10458
366 1020 & 1030 Boynton Avenue 1020 & 1030 Boynton Avenue Bronx NY 10472
367 Amberlake Apartments 4901 Bartow Road Acworth GA 30101
368 Pine Valley Estates Apartments 415 West Redd Road El Paso TX 79932
369 West 141st Street Apartments 111-115 West 141st Street New York NY 10030
370 West 24th Street 1300 - 1302 West 24th Street Austin TX 78705
371 Chestnut Hill Apartments 246 Chestnut Hill Road Marietta GA 30064
372 Courtyard Apartments 2300 North "A" Street Midland TX 79705
373 Century Heights Apartments 1305 West Woodrow Road Slaton TX 79364
374 Western Crest Apartments 3901 Avenue O Snyder TX 79549
375 Terwood Court Apartments 329 - 331 West Washington Westchester PA 19380
376 Winding Way Apartments 13266 Emily Road Dallas TX 75240
377 Morningside Bay Apartments 5995 Biscayne Boulevard Miami FL 33137
378 Del Toro Apartments 909 South Priest Drive Tempe AZ 85008
379 Eucalyptus Apartments 3055 N. Tyndall Tucson AZ 85719
380 Bonnie Lynn Apartments 2020 West Hayward Avenue Phoenix AZ 85021
381 Regal Oaks Apartments 115 Woodland Avenue Atlanta GA 30329
382 Papago Palms West 1835 North 51st Street Phoenix AZ 85008
383 Malibu Apartments 3655 North First Avenue Tucson AZ 85719
384 Darling Street Apartments 3, 5 & 11 Darling Street Roxbury MA 02120
385 2025-2027 Walnut Street 2025 - 2027 Walnut Street Philadelphia PA 19103
386 Burlington Townhomes 102 Denise Drive Burlington NC 27215
387 Woodglen Apartments 818 Pinemont Houston TX 77018
388 Abbey Arms Apartments 2010 Abbey Road Norfolk VA 23518
541 Cameron Court Apartments 1675 Smyrna Roswell Road Smyrna GA 30136
389 Newport Central Townhomes 5506 Grover Avenue Austin TX 78756
390 Village Phoenix Apartments 2620 North 40th Street Phoenix AZ 85008
391 Woodside Court Apartments 103 - 105 South Narberth Avenue Narberth PA 19072
392 Concord Green Apartments 7001 Northline Drive Houston TX 77076
393 Bellerive Apartments 214 East Armour Boulevard Kansas City MO 64111
394 Prince Plaza Apartments 120 West Prince Road Tucson AZ 85705
395 Silver Club Apartments 5170 Silver Creek Drive Houston TX 77017
396 Beechnut Palms Apartments 8910 Beechnut Street Houston TX 77072
397 Foresight Village Apartments -
Phase I 610 & 616 25 1/2 Road Grand Junction CO 81505
542 Pleasonton Valley Apartments 3735 Pleasanton Road San Antonio TX 78221
398 Canterbury Apartments 689 - 695 Farmington Avenue West Hartford CT 06107
399 Altos Park Apartments 1119 - 1131 Mary Ellen, NE Albuquerque NM 87112
400 Amberwood Apartments 800 Hamsted Street Fort Worth TX 76115
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
351 958,012.64 8,021.09 9.250 90 330 09/01/2005 No Balloon
352 343,680.48 3,444.32 9.875 210 210 09/01/2015 No Fully Amortizing
353 988,589.78 9,132.44 10.000 64 280 07/01/2003 No Balloon
354 870,368.93 8,242.80 9.250 219 219 06/01/2016 No Fully Amortizing
355 638,948.29 5,792.39 9.750 100 280 07/01/2006 No Balloon
356 609,243.85 5,470.89 9.625 40 280 07/01/2001 No Balloon
357 492,118.42 4,499.52 9.875 101 281 08/01/2006 No Balloon
358 1,180,697.18 10,693.65 9.750 101 281 08/01/2006 No Balloon
359 1,470,406.70 12,802.91 9.250 66 282 09/01/2003 No Balloon
360 1,167,034.41 11,087.80 9.375 222 222 09/01/2016 No Fully Amortizing
540 1,263,318.57 10,798.49 8.875 92 272 11/01/2005 No Balloon
361 860,400.04 6,961.89 8.875 93 333 12/01/2005 No Balloon
362 609,599.39 5,100.59 9.250 91 331 10/01/2005 No Balloon
365 707,234.19 7,019.03 9.750 211 211 10/01/2015 No Fully Amortizing
366 1,433,582.89 14,227.76 9.750 211 211 10/01/2015 No Fully Amortizing
367 1,259,159.61 10,867.59 9.000 92 272 11/01/2005 No Balloon
368 1,285,304.72 13,786.35 8.500 153 153 12/01/2010 No Fully Amortizing
369 382,719.63 3,761.24 9.625 212 212 11/01/2015 No Fully Amortizing
370 764,746.51 7,069.69 8.750 214 214 01/01/2016 No Fully Amortizing
371 525,410.85 4,816.63 8.625 214 214 01/01/2016 No Fully Amortizing
372 1,101,562.42 9,537.44 9.125 98 278 05/01/2006 No Balloon
373 482,165.90 4,498.63 9.000 218 218 05/01/2016 No Fully Amortizing
374 603,034.53 5,673.63 9.125 218 218 05/01/2016 No Fully Amortizing
375 1,247,933.31 11,860.48 9.250 217 217 04/01/2016 No Fully Amortizing
376 482,686.29 4,579.33 9.250 218 218 05/01/2016 No Fully Amortizing
377 489,067.36 4,238.86 9.125 97 277 04/01/2006 No Balloon
378 259,587.40 2,269.41 9.250 62 278 05/01/2003 No Balloon
379 389,899.59 3,220.91 8.500 96 276 03/01/2006 No Balloon
380 537,973.99 4,662.75 9.125 97 277 04/01/2006 No Balloon
381 386,353.47 3,695.93 9.375 218 218 05/01/2016 No Fully Amortizing
382 622,201.99 5,182.86 9.250 62 338 05/01/2003 No Balloon
383 691,748.63 5,934.41 9.125 107 286 02/01/2007 No Balloon
384 1,268,746.20 10,530.25 9.250 104 344 11/01/2006 No Balloon
385 477,963.50 4,153.45 9.250 104 284 11/01/2006 No Balloon
386 347,193.95 3,106.05 9.625 104 284 11/01/2006 No Balloon
387 753,623.67 6,884.27 9.875 102 282 09/01/2006 No Balloon
388 488,427.81 4,281.87 9.375 105 285 12/01/2006 No Balloon
541 803,411.94 7,049.94 9.375 104 284 11/01/2006 No Balloon
389 887,713.16 7,399.29 8.750 106 286 01/01/2007 No Balloon
390 620,635.69 5,504.28 9.500 103 283 10/01/2006 No Balloon
391 493,309.36 4,153.27 8.875 106 286 01/01/2007 No Balloon
392 1,233,273.56 10,383.16 8.875 286 286 01/01/2022 No Fully Amortizing
393 1,193,808.80 10,050.90 8.875 106 286 01/01/2007 No Balloon
394 399,898.64 3,468.35 9.250 106 286 01/01/2007 No Balloon
395 493,442.59 4,195.98 9.000 106 286 01/01/2007 No Balloon
396 986,885.16 8,391.96 9.000 106 286 01/01/2007 No Balloon
397 1,680,866.82 14,324.59 9.050 107 287 02/01/2007 No Balloon
542 642,945.64 5,566.48 9.250 107 287 02/01/2007 No Balloon
398 560,954.48 4,798.39 9.125 109 289 04/01/2007 No Balloon
399 653,264.81 5,806.20 9.625 110 290 05/01/2007 No Balloon
400 809,134.98 7,191.57 9.625 110 290 05/01/2007 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
351 0.095 Daiwa Finance Corp. First Union 30/360
352 0.095 Daiwa Finance Corp. First Union 30/360
353 0.095 Daiwa Finance Corp. First Union 30/360
354 0.095 Daiwa Finance Corp. First Union 30/360
355 0.095 Daiwa Finance Corp. First Union 30/360
356 0.095 Daiwa Finance Corp. First Union 30/360
357 0.095 Daiwa Finance Corp. First Union 30/360
358 0.095 Daiwa Finance Corp. First Union 30/360
359 0.095 Daiwa Finance Corp. First Union 30/360
360 0.095 Daiwa Finance Corp. First Union 30/360
540 0.095 Daiwa Finance Corp. First Union 30/360
361 0.095 Daiwa Finance Corp. First Union 30/360
362 0.095 Daiwa Finance Corp. First Union 30/360
365 0.095 Daiwa Finance Corp. First Union 30/360
366 0.095 Daiwa Finance Corp. First Union 30/360
367 0.095 Daiwa Finance Corp. First Union 30/360
368 0.095 Daiwa Finance Corp. First Union 30/360
369 0.095 Daiwa Finance Corp. First Union 30/360
370 0.095 Daiwa Finance Corp. First Union 30/360
371 0.095 Daiwa Finance Corp. First Union 30/360
372 0.095 Daiwa Finance Corp. First Union 30/360
373 0.095 Daiwa Finance Corp. First Union 30/360
374 0.095 Daiwa Finance Corp. First Union 30/360
375 0.095 Daiwa Finance Corp. First Union 30/360
376 0.095 Daiwa Finance Corp. First Union 30/360
377 0.095 Daiwa Finance Corp. First Union 30/360
378 0.095 Daiwa Finance Corp. First Union 30/360
379 0.095 Daiwa Finance Corp. First Union 30/360
380 0.095 Daiwa Finance Corp. First Union 30/360
381 0.095 Daiwa Finance Corp. First Union 30/360
382 0.095 Daiwa Finance Corp. First Union 30/360
383 0.095 Daiwa Finance Corp. First Union Actual/360
384 0.095 Daiwa Finance Corp. First Union 30/360
385 0.095 Daiwa Finance Corp. First Union 30/360
386 0.095 Daiwa Finance Corp. First Union 30/360
387 0.095 Daiwa Finance Corp. First Union 30/360
388 0.095 Daiwa Finance Corp. First Union 30/360
541 0.095 Daiwa Finance Corp. First Union 30/360
389 0.095 Daiwa Finance Corp. First Union 30/360
390 0.095 Daiwa Finance Corp. First Union 30/360
391 0.095 Daiwa Finance Corp. First Union 30/360
392 0.095 Daiwa Finance Corp. First Union 30/360
393 0.095 Daiwa Finance Corp. First Union 30/360
394 0.095 Daiwa Finance Corp. First Union 30/360
395 0.095 Daiwa Finance Corp. First Union 30/360 Cntrl # 396
396 0.095 Daiwa Finance Corp. First Union 30/360 Cntrl # 395
397 0.095 Daiwa Finance Corp. First Union Actual/360
542 0.095 Daiwa Finance Corp. First Union Actual/360
398 0.095 Daiwa Finance Corp. First Union Actual/360
399 0.095 Daiwa Finance Corp. First Union Actual/360
400 0.095 Daiwa Finance Corp. First Union Actual/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Daiwa Finance
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
401 Pinon Terrace Apartments 8409 Comanche Road Albuquerque NM 87111
402 Second Street Apartments 80 - 86 Second Street Elizabeth NJ 07206
403 Steele Street Apartments 1421 Steele Street Denver CO 80218
404 Williams Street Apartments 1436 Williams Street Denver CO 80206
405 Beverly Rossmore Apartments 304 North Rossmore Avenue Los Angeles CA 90004
406 Chestnut Mansion 114 West Chestnut Street Kingston NY 12401
407 Riverside Village 1608 8th Street NE Auburn WA 98022
408 Woodlawn Apartments 3762 UpRiver Road Corpus Christi TX 78408
409 96 Wadsworth Terrace 96 Wadsworth Terrace New York NY 10005
410 Vanowen Street Apartments 16215 - 16221 Vanowen Street Van Nuys CA 94406
411 Saticoy Street Apartments 20445 Saticoy Street Canoga Park CA 91306
412 Bombay Apartments 11922 Burbank Boulevard North Hollywood CA 91607
413 Albion Manor Apartments 1500 - 10 South Albion Street Denver CO 80220
414 1479 Macombs Road 1479 Macombs Road Bronx NY 10452
415 The Seville Apartments 1148 William Street Bridgeport CT 06608
416 Denton Court Apartments 4735 Denton Street Dallas TX 75219
417 Mulberry Place Apartments 1661 Mulberry Street Charleston SC 29407
418 Windsor Apartments 4421 Windsor Drive Fort Smith AR 72904
419 Willow Pointe Apartments 3224 & 3212 Massard and 3207 & 3211 Enid Fort Smith AR 72903
420 Southtown Apartments 5039 South 31st Fort Smith AR 72903
421 470 Beacon Street 470 Beacon Street Boston MA 02117
422 Meadow Lea Apartments 8217 Fulton Street Houston TX 77022
423 Princess Apartments 1177 South Norton Ave. Los Angeles CA 90019
424 Villa Martel Apartments 3602 E. Monte Vista Road Phoenix AZ 85008
425 Stardust Apartments 5727 Gaston Avenue Dallas TX 75214
426 1808 Beverly Road 1808 Beverly Road Brooklyn NY 11226
427 Lake Avenue Apartments 144 Lake Avenue Manchester NH 03104
428 Shea Terrace Apartments 222-224 Sandpiper Drive Portsmouth VA 23704
429 Sunset Gardens 801 Las Lomas Avenue Pacific Palisades CA 90272
430 Country Creek Village Apartments 3783 Legendary Lane Dallas TX 75224
431 Pine Hill Apartments 367 Fletchwood Road Elkton MD 21921
432 Stoneridge Apartments 1500 South Lamar Boulevard Austin TX 78704
433 Highland Villas Apartments 210 North Avenue 55 Los Angeles CA 90042
434 Mount Vernon Manor Apartments 9225 Long Point Houston TX 77055
435 Lanier Place 1725 Lanier Place, NW Washington DC 20009
436 Tamarack Shadows Apartments 3101 North 36th Street Phoenix AZ 85018
437 Royal Poinciana 380 North Royal Poinciana Boulevard Miami Springs FL 33166
438 37 Wales Street 37 Wales Street Dorchester MA 02124
439 Joanne Marie Apartments 807 N. W. 24th Street Wilton Manors FL 33311
440 Dorchester Apartments 1350-1358 Dorchester Avenue Dorchester MA 02122
441 Hillside Village Apartments 1401 East Dunlap Phoenix AZ 85020
442 Lake Forest Apartments 2320 N. Vermilion St. Danville IL 61832
443 Manor Apartments and Traymore Apartments 130 North McLean and 51 South McLean Memphis TN 38104
444 Shadow Oaks Apartments 1523 Heights Boulevard Houston TX 77008
445 Kimberly Oaks Apartments 1530 Heights Boulevard Houston TX 77008
446 Birch Row Apartments 1201 - 1211 Locust Street Philadelphia PA 19107
447 Mansard Place Apartments 6156 S. Loop East Houston TX 77087
448 Broadway Park Apartments 2505 Broadway Houston TX 77012
449 The Deely Place Apartments 8511 South Flores San Antonio TX 78221
450 Atlantic City Apartments 1901 Haren Drive Henderson NV 89015
451 Checker Auto Parts 2206 North Big Spring Street Midland TX 79705
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
401 1,298,379.73 11,446.14 9.520 110 290 05/01/2007 No Balloon
402 760,839.14 6,696.88 9.500 110 290 05/01/2007 No Balloon
403 213,908.38 1,882.82 9.500 110 290 05/01/2007 No Balloon
404 248,649.96 2,188.61 9.500 110 290 05/01/2007 No Balloon
405 991,827.29 8,391.96 9.000 110 290 05/01/2007 No Balloon
406 1,210,517.21 10,447.86 9.250 110 290 05/01/2007 No Balloon
407 714,990.33 6,228.17 9.375 111 291 06/01/2007 No Balloon
408 595,825.28 5,190.14 9.375 111 291 06/01/2007 No Balloon
409 843,938.67 7,279.25 9.250 111 291 06/01/2007 No Balloon
410 575,964.39 5,017.14 9.375 111 291 06/01/2007 No Balloon
411 1,097,311.53 9,558.51 9.375 111 291 06/01/2007 No Balloon
412 705,059.88 6,141.67 9.375 111 291 06/01/2007 No Balloon
413 843,938.67 7,279.25 9.250 111 291 06/01/2007 No Balloon
414 1,490,901.57 12,975.35 9.375 112 292 07/01/2007 No Balloon
415 484,467.51 4,174.86 9.250 112 292 07/01/2007 No Balloon
416 1,068,143.64 9,113.56 9.125 112 292 07/01/2007 No Balloon
417 715,056.61 5,919.43 8.750 112 292 07/01/2007 No Balloon
418 422,567.42 3,603.03 9.125 113 293 08/01/2007 No Balloon
419 661,193.68 5,637.69 9.125 113 293 08/01/2007 No Balloon
420 323,139.78 2,755.26 9.125 113 293 08/01/2007 No Balloon
421 715,407.88 6,103.96 9.125 112 292 07/01/2007 No Balloon
422 596,267.70 5,138.29 9.250 112 292 07/01/2007 No Balloon
423 734,688.75 6,273.52 9.125 112 292 07/01/2007 No Balloon
424 715,407.88 6,103.96 9.125 112 292 07/01/2007 No Balloon
425 377,576.34 3,221.54 9.125 112 292 07/01/2007 No Balloon
426 377,772.71 3,188.95 9.000 113 293 08/01/2007 No Balloon
427 323,003.49 2,671.97 8.750 113 293 08/01/2007 No Balloon
428 187,654.93 1,643.54 9.375 106 286 01/01/2007 No Balloon
429 500,594.44 4,629.68 9.125 228 228 03/01/2017 No Fully Amortizing
430 889,514.51 7,707.44 9.250 107 287 02/01/2007 No Balloon
431 1,583,206.12 13,840.37 9.375 48 288 03/01/2002 No Balloon
432 2,370,290.72 19,935.66 8.875 107 287 02/01/2007 No Balloon
433 1,207,470.97 9,901.91 9.125 70 346 01/01/2004 No Balloon
434 726,800.16 6,168.09 9.000 108 288 03/01/2007 No Balloon
435 885,530.29 8,389.18 9.500 229 229 04/01/2017 No Fully Amortizing
436 593,306.18 5,035.18 9.000 108 288 03/01/2007 No Balloon
437 457,831.44 4,943.37 9.625 170 170 05/01/2012 No Fully Amortizing
438 411,771.46 3,589.85 9.375 111 291 06/01/2007 No Balloon
439 381,726.97 3,363.73 9.500 110 290 05/01/2007 No Balloon
440 775,219.63 6,679.78 9.250 113 293 08/01/2007 No Balloon
441 546,077.00 5,173.33 9.500 229 229 04/01/2017 No Fully Amortizing
442 1,487,841.80 12,716.59 9.125 111 291 06/01/2007 No Balloon
443 683,728.75 6,251.86 10.000 292 292 07/01/2022 No Fully Amortizing
444 293,744.23 2,586.14 9.500 111 291 06/01/2007 No Balloon
445 331,454.62 2,918.15 9.500 111 291 06/01/2007 No Balloon
446 496,763.55 4,455.69 9.750 52 292 07/01/2002 No Balloon
447 1,786,541.39 14,951.76 8.875 112 292 07/01/2007 No Balloon
448 2,173,625.43 18,191.30 8.875 112 292 07/01/2007 No Balloon
449 846,675.92 6,839.29 9.000 113 353 08/01/2007 No Balloon
450 956,341.22 7,810.88 9.125 113 353 08/01/2007 No Balloon
451 516,942.28 4,543.22 9.500 293 293 08/01/2022 No Fully Amortizing
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- -------------------------------------------------------------------------------------------------------------------------
<S> <S> <C> <C> <C> <C> <C>
401 0.095 Daiwa Finance Corp. First Union Actual/360
402 0.095 Daiwa Finance Corp. First Union Actual/360
403 0.095 Daiwa Finance Corp. First Union Actual/360
404 0.095 Daiwa Finance Corp. First Union Actual/360
405 0.095 Daiwa Finance Corp. First Union Actual/360
406 0.095 Daiwa Finance Corp. First Union Actual/360
407 0.095 Daiwa Finance Corp. First Union Actual/360
408 0.095 Daiwa Finance Corp. First Union Actual/360
409 0.095 Daiwa Finance Corp. First Union Actual/360
410 0.095 Daiwa Finance Corp. First Union Actual/360
411 0.095 Daiwa Finance Corp. First Union Actual/360
412 0.095 Daiwa Finance Corp. First Union Actual/360
413 0.095 Daiwa Finance Corp. First Union Actual/360
414 0.095 Daiwa Finance Corp. First Union Actual/360
415 0.095 Daiwa Finance Corp. First Union Actual/360
416 0.095 Daiwa Finance Corp. First Union Actual/360
417 0.095 Daiwa Finance Corp. First Union Actual/360
418 0.095 Daiwa Finance Corp. First Union Actual/360 Cntrl #'s 419, 420
419 0.095 Daiwa Finance Corp. First Union Actual/360 Cntrl #'s 418, 420
420 0.095 Daiwa Finance Corp. First Union Actual/360 Cntrl #'s 418, 419
421 0.095 Daiwa Finance Corp. First Union Actual/360
422 0.095 Daiwa Finance Corp. First Union Actual/360
423 0.095 Daiwa Finance Corp. First Union 30/360
424 0.095 Daiwa Finance Corp. First Union Actual/360
425 0.095 Daiwa Finance Corp. First Union Actual/360
426 0.095 Daiwa Finance Corp. First Union Actual/360
427 0.095 Daiwa Finance Corp. First Union Actual/360
428 0.095 Daiwa Finance Corp. First Union 30/360
429 0.095 Daiwa Finance Corp. First Union 30/360
430 0.095 Daiwa Finance Corp. First Union 30/360
431 0.095 Daiwa Finance Corp. First Union 30/360
432 0.095 Daiwa Finance Corp. First Union 30/360
433 0.095 Daiwa Finance Corp. First Union 30/360
434 0.095 Daiwa Finance Corp. First Union 30/360
435 0.095 Daiwa Finance Corp. First Union 30/360
436 0.095 Daiwa Finance Corp. First Union 30/360
437 0.095 Daiwa Finance Corp. First Union 30/360
438 0.095 Daiwa Finance Corp. First Union 30/360
439 0.095 Daiwa Finance Corp. First Union 30/360
440 0.095 Daiwa Finance Corp. First Union 30/360
441 0.095 Daiwa Finance Corp. First Union 30/360
442 0.095 Daiwa Finance Corp. First Union 30/360
443 0.095 Daiwa Finance Corp. First Union 30/360
444 0.095 Daiwa Finance Corp. First Union 30/360
445 0.095 Daiwa Finance Corp. First Union 30/360
446 0.095 Daiwa Finance Corp. First Union 30/360
447 0.095 Daiwa Finance Corp. First Union 30/360
448 0.095 Daiwa Finance Corp. First Union 30/360
449 0.095 Daiwa Finance Corp. First Union 30/360
450 0.095 Daiwa Finance Corp. First Union 30/360
451 0.095 Daiwa Finance Corp. First Union 30/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Daiwa Finance
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
452 The Samuel Building 7290 Samuel Drive Denver CO 80221
453 Canberra Apartments 2929 North 36th Street Phoenix AZ 85018
454 Rosewood Gardens 7 Charles Street Roselle NJ 07204
455 Hickory Apartments 320 South Jupiter Road Garland TX 75042
456 Dutch Haven Apartments 846 Piney Grove Columbia SC 29210
457 Robinswood Apartments 800 North Hastings Street Orlando FL 32808
458 Sunset Apartments 830 & 840 Sunset Drive Athens GA 30601
459 3301 Powelton Avenue 3301- 3315 Powelton Avenue Philadelphia PA 19104
460 Bryan Place Apartments 3219 San Jacinto Dallas TX 75044
461 Skyline Woods Apartments Skyline Drive Saugerties NY 12477
462 Sunrise Apartments 190 Kirkwood Road, NE Atlanta GA 30317
463 Featherstone Apartments 7800 - 7820 Featherstone Drive Raleigh NC 27612
464 Wayne Street Apartments 5339 Wayne Street Raleigh NC 27606
543 Castille Court Apartments 1811 Rogero Road Jacksonville FL 32211
465 The Villages Apartment 1775 Leon Road Jacksonville FL 32211
466 Seligson Portfolio - 605 West Avenue 605 West Avenue Norwalk CT 06850
467 Seligson Portfolio - 698 West Avenue 698 West Avenue Norwalk CT 06850
468 Seligson Portfolio - 17 Butler Street 17 Butler Street Norwalk CT 06850
469 McFarlin Condos 3412 McFarlin Blvd. University Park TX 75205
470 Palms at Byron Place 8535 Byron Avenue Miami Beach FL 33141
471 Olde North Village Apartments 3490 Triangle Drive Winston-Salem NC 27106
472 Savings Tower 45 Savings Street Waterbury CT 06702
473 Hawthorne Apartments 1491 Hawthorne Avenue Houston TX 77006
474 Oak Forest Apartments 3614 Pine Oak Avenue Southwest Wyoming MI 49509
475 Rampart Gardens Apartments 6300 Rampart Houston TX 77081
476 Morris Hall Apartments 357 Morris Street Albany NY 12207
477 English Hills II 2004 140th Avenue & 2005 142nd Avenue Tampa FL 33613
478 670 Garden Street 670 Garden Street Bronx NY 10457
489 Trinity Court Condominiums 6526 - 6530 Ridgecrest Dallas TX 75231
490 Townhouse Apartments 12621 Lomas Boulevard N.E. Albuquerque NM 87112
491 D'iberville Apartments 265 Front Beach Drive Ocean Springs MS 39564
492 Ricciuti Court Apartments 445 Shenandoah Drive Penn Hills PA 15235
493 495 Washington Avenue 495 Washinton Avenue Brooklyn NY 11238
494 The Tropic Estates Apartments 3044 Jamaica Drive Corpus Christi TX 78418
495 Glenoaks Apartments 8817 South 28th Street Fort Smith AR 72908
496 Gilmore Apartments 705-725 & 815 - 823 North Gilmore Avenue Lakeland FL 33801
497 Village Meadows 9801 Meandering Way Fort Smith AR 72903
498 Blair House Apartments 321-323 Montgomery and 324 N. Bellevue Memphis TN 38104
499 Tahiti Village Apartments 883 Buena Vista Avenue Pomona CA 91766
500 1011 Sheridan Avenue 1011 Sheridan Avenue Bronx NY 10456
501 Kirlin Place Apartments 27 Old Lawrence Road Pelham NH 03076
502 Las Casitas Apartments 4100 East 29th Street Tucson AZ 85711
503 Orangewood Place Apartments 7328 North 27th Avenue Phoenix AZ 85051
504 Edison Terrace Apartments 401 N. Ash Street Centralia WA 98531
505 Ramsey Apartments 201 - 207 East Glendale Avenue Alexandria VA 22030
506 Glendale Apartments 200-216 E. Glendale Avenue Alexandria VA 22301
507 Burton Gardens Apartments 300 - 311 East Glendale Avenue Alexandria VA 22030
508 Drexel Terrace Apartments 1356 & 1360 East Drexel Road Tucson AZ 85706
509 Lake Parker Apartments 730-810 East First Street Lakeland FL 33805
510 Corporate Point Office Building 14100 Park Meadow Drive Chantilly VA 20151
511 Great Western Bank Building 13701 - 13739 Riverside Drive Sherman Oaks CA 91423
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS -------------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
452 721,127.04 6,146.35 9.125 54 294 09/01/2002 No Balloon
453 992,786.08 7,884.50 8.250 113 293 08/01/2007 No Balloon
454 586,115.93 4,701.24 8.375 113 293 08/01/2007 No Balloon
455 696,202.14 5,755.01 8.750 114 294 09/01/2007 No Balloon
456 877,371.29 7,159.97 9.125 114 354 09/01/2007 No Balloon
457 671,337.80 5,549.47 8.750 114 294 09/01/2007 No Balloon
458 865,383.30 7,226.68 8.875 114 294 09/01/2007 No Balloon
459 577,527.15 4,867.34 9.000 115 295 10/01/2007 No Balloon
460 380,869.35 3,209.90 9.000 115 295 10/01/2007 No Balloon
461 746,654.17 6,166.08 8.750 115 295 10/01/2007 No Balloon
462 425,505.53 3,442.35 8.500 115 295 10/01/2007 No Balloon
463 597,323.35 4,932.86 8.750 115 295 10/01/2007 No Balloon
464 199,107.76 1,644.29 8.750 115 295 10/01/2007 No Balloon
543 482,836.35 3,987.40 8.750 115 295 10/01/2007 No Balloon
465 632,167.23 5,220.61 8.750 115 295 10/01/2007 No Balloon
466 4,133,387.11 31,170.90 8.010 115 325 10/01/2007 No Balloon
467 1,444,195.49 10,891.04 8.010 115 325 10/01/2007 No Balloon
468 5,577,582.60 42,061.94 8.010 115 325 10/01/2007 No Balloon
469 647,404.95 5,179.34 8.375 116 296 11/01/2007 No Balloon
470 796,934.29 6,509.34 8.625 116 296 11/01/2007 No Balloon
471 792,195.23 6,739.79 9.125 296 296 11/01/2022 No Fully Amortizing
472 896,332.90 7,096.05 8.250 116 296 11/01/2007 No Balloon
473 448,275.52 3,661.51 8.625 116 296 11/01/2007 No Balloon
474 399,141.19 3,254.53 9.125 236 356 11/01/2017 No Balloon
475 2,040,943.75 15,484.24 7.750 116 296 11/01/2007 No Balloon
476 637,496.61 5,153.45 8.500 116 296 11/01/2007 No Balloon
477 258,940.61 2,049.97 8.250 116 296 11/01/2007 No Balloon
478 745,462.39 6,747.94 9.000 236 236 11/01/2017 No Fully Amortizing
489 618,034.26 4,785.26 8.000 117 297 12/01/2007 No Balloon
490 797,662.47 6,441.82 8.500 117 297 12/01/2007 No Balloon
491 897,203.89 7,021.04 8.125 117 297 12/01/2007 No Balloon
492 718,103.25 6,103.96 9.125 117 297 12/01/2007 No Balloon
493 518,449.11 4,143.47 8.375 117 297 12/01/2007 No Balloon
494 807,379.30 6,184.79 7.875 117 297 12/01/2007 No Balloon
495 1,064,675.20 8,591.77 8.500 118 298 01/01/2008 No Balloon
496 1,028,597.37 7,957.43 8.000 118 298 01/01/2008 No Balloon
497 458,997.74 3,704.04 8.500 118 298 01/01/2008 No Balloon
498 319,524.96 3,252.70 11.500 118 298 01/01/2008 No Balloon
499 1,496,770.32 11,453.31 7.875 118 298 01/01/2008 No Balloon
500 2,095,022.88 16,034.63 7.875 118 298 01/01/2008 No Balloon
501 708,429.51 5,934.01 9.350 103 343 10/01/2006 No Balloon
502 2,432,979.47 21,452.37 9.250 90 270 09/01/2005 No Balloon
503 1,241,302.69 10,812.79 9.375 111 291 06/01/2007 No Balloon
504 757,189.32 6,115.13 9.000 112 352 07/01/2007 No Balloon
505 844,531.04 6,844.43 8.500 113 293 08/01/2007 No Balloon
506 844,531.04 6,844.43 8.500 113 293 08/01/2007 No Balloon
507 1,142,600.83 9,260.11 8.500 113 293 08/01/2007 No Balloon
508 520,097.22 4,597.69 8.625 114 234 09/01/2007 No Balloon
509 583,659.53 4,563.67 8.125 118 298 01/01/2008 No Balloon
510 4,010,309.83 30,364.22 7.750 118 298 01/01/2008 No Balloon
511 3,191,482.35 22,657.78 7.020 118 298 01/01/2008 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
452 0.095 Daiwa Finance Corp. First Union 30/360
453 0.095 Daiwa Finance Corp. First Union 30/360
454 0.095 Daiwa Finance Corp. First Union Actual/360
455 0.095 Daiwa Finance Corp. First Union Actual/360
456 0.095 Daiwa Finance Corp. First Union Actual/360
457 0.095 Daiwa Finance Corp. First Union Actual/360
458 0.095 Daiwa Finance Corp. First Union Actual/360
459 0.095 Daiwa Finance Corp. First Union Actual/360
460 0.095 Daiwa Finance Corp. First Union Actual/360
461 0.095 Daiwa Finance Corp. First Union Actual/360
462 0.095 Daiwa Finance Corp. First Union Actual/360
463 0.095 Daiwa Finance Corp. First Union Actual/360
464 0.095 Daiwa Finance Corp. First Union Actual/360
543 0.095 Daiwa Finance Corp. First Union Actual/360
465 0.095 Daiwa Finance Corp. First Union Actual/360
466 0.095 Daiwa Finance Corp. First Union Yes Actual/360 Cntrl #'s 467, 468
467 0.095 Daiwa Finance Corp. First Union Yes Actual/360 Cntrl #'s 466, 468
468 0.095 Daiwa Finance Corp. First Union Yes Actual/360 Cntrl #'s 466, 467
469 0.095 Daiwa Finance Corp. First Union Actual/360
470 0.095 Daiwa Finance Corp. First Union Actual/360
471 0.095 Daiwa Finance Corp. First Union Actual/360
472 0.095 Daiwa Finance Corp. First Union Actual/360
473 0.095 Daiwa Finance Corp. First Union Actual/360
474 0.095 Daiwa Finance Corp. First Union Actual/360
475 0.095 Daiwa Finance Corp. First Union Actual/360
476 0.095 Daiwa Finance Corp. First Union Actual/360
477 0.095 Daiwa Finance Corp. First Union Actual/360
478 0.095 Daiwa Finance Corp. First Union Actual/360
489 0.095 Daiwa Finance Corp. First Union Actual/360
490 0.095 Daiwa Finance Corp. First Union Actual/360
491 0.095 Daiwa Finance Corp. First Union Actual/360
492 0.095 Daiwa Finance Corp. First Union Actual/360
493 0.095 Daiwa Finance Corp. First Union Actual/360
494 0.095 Daiwa Finance Corp. First Union Actual/360
495 0.095 Daiwa Finance Corp. First Union Actual/360
496 0.095 Daiwa Finance Corp. First Union Actual/360
497 0.095 Daiwa Finance Corp. First Union Actual/360
498 0.095 Daiwa Finance Corp. First Union Actual/360
499 0.095 Daiwa Finance Corp. First Union 30/360
500 0.095 Daiwa Finance Corp. First Union Actual/360
501 0.095 Daiwa Finance Corp. First Union 30/360
502 0.095 Daiwa Finance Corp. First Union 30/360
503 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
504 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
505 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
506 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
507 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
508 0.285 Daiwa Finance Corp. Continental Wingate Actual/360
509 0.095 Daiwa Finance Corp. First Union Actual/360
510 0.160 Daiwa Finance Corp. Collateral Mortgage Yes Actual/360
511 0.095 Daiwa Finance Corp. First Union Yes Actual/360
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Daiwa Finance
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
512 Windsor Hall Apartments 179 Dwight Street New Haven CT 06533
513 Foresight Village Apartments - Phase II 620 25 1/2 Road Grand Junction CO 81501
515 Windsong Apartments 2320 North Garrett Drive Dallas TX 75206
516 Wellington Apartments 818 Forest Drive & 812 Woods Drive Newport News VA 23605
517 Golden Villas Apartments 4088-4136 Silver Dollar Las Vegas NV 89102
518 Parkwood Apartments 5917 Carmelita Avenue Huntington Park CA 90255
520 Folcroft Apartments 1503-1505, 1511, 1513, 1528 Elmwood & 1
528 Baltimore Folcroft PA 19032
521 Claridge Manor Apartments 72 - 92 Colonel Bell Drive Brockton MA 02401
522 Oakwood Apartments 1104 140th Street East Tampa FL 33613
523 Teesdale Apartments 1730-1736 Teesdale Street Philadelphia PA 19111
524 The Mase Building 6515 Main Street Trumbull CT 06611
525 Brandywine Apartments 4710 Lake Avenue Dallas TX 75219
526 Tropic Isle Apartments 260 East Newburgh Street Azusa CA 91702
527 Leisure Isle Apartments 3615 - 3623 Gilman Road El Monte CA 91732
528 Laurel Apartments 1420 - 1446 Laurel Avenue Pomona CA 91768
529 La Mesa Apartments 752 La Mesa Avenue Pomona CA 91766
530 Villa Fontana Apartments 3719 - 3725 Gilman Road El Monte CA 91732
531 Park Lane Apartments 2628 Maxson Road El Monte CA 91732
533 Comfort Inn - Ormond Beach 507 South Atlantic Avenue Ormond Beach FL 32176
534 Comfort Inn - St. Augustine 1111 N.Ponce De Leon Blvd. St. Augustine FL 32084
537 Ramada Inn - Katy 22025 IH-10 West Katy TX 77450
538 Quail Run 1000 South Clack Street Abilene TX 79605
539 The Sarvis Building and Conference Center 6104 and 6111 Gazebo Park Place North Jacksonville FL 32257
532 Lincoln Apartments 219 Lincoln Avenue Newark NJ 07104
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ------------ MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
512 448,986.07 3,548.03 8.250 118 298 01/01/2008 No Balloon
513 748,824.78 5,503.23 8.000 118 358 01/01/2008 No Balloon
515 398,831.23 3,220.91 8.500 117 297 12/01/2007 No Balloon
516 1,991,651.06 16,072.33 8.500 118 298 01/01/2008 No Balloon
517 748,252.23 5,788.62 8.000 118 298 01/01/2008 No Balloon
518 1,123,691.66 8,222.40 7.375 179 299 02/01/2013 No Balloon
520 1,647,555.18 12,871.90 8.125 119 299 02/01/2008 No Balloon
521 2,146,653.36 15,888.31 7.500 119 299 02/01/2008 No Balloon
522 1,497,711.74 11,329.93 7.750 119 299 02/01/2008 No Balloon
523 271,599.26 2,135.50 8.200 119 299 02/01/2008 No Balloon
524 723,420.34 5,837.90 8.500 118 298 01/01/2008 No Balloon
525 828,161.02 6,613.61 8.375 118 298 01/01/2008 No Balloon
526 898,608.18 6,697.82 7.580 179 299 02/01/2013 No Balloon
527 1,021,417.96 7,613.19 7.580 179 299 02/01/2013 No Balloon
528 299,536.06 2,232.61 7.580 179 299 02/01/2013 No Balloon
529 522,191.20 3,892.18 7.580 179 299 02/01/2013 No Balloon
530 1,198,144.24 8,930.43 7.580 179 299 02/01/2013 No Balloon
531 1,048,376.20 7,814.13 7.580 179 299 02/01/2013 No Balloon
533 1,496,712.91 12,258.76 7.690 119 239 02/01/2008 No Balloon
534 3,094,545.64 23,899.36 7.650 119 275 02/01/2008 No Balloon
537 1,594,600.40 15,106.27 7.800 179 179 02/01/2013 No Fully Amortizing
538 1,104,312.78 8,353.94 7.750 119 299 02/01/2008 No Balloon
539 2,596,679.29 19,599.60 8.050 119 329 02/01/2008 No Balloon
532 745,620.35 7,330.70 8.375 178 178 01/01/2013 No Fully Amortizing
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
512 0.095 Daiwa Finance Corp. First Union Actual/360
513 0.095 Daiwa Finance Corp. First Union Actual/360
515 0.095 Daiwa Finance Corp. First Union Actual/360
516 0.095 Daiwa Finance Corp. First Union Actual/360
517 0.095 Daiwa Finance Corp. First Union Actual/360
518 0.095 Daiwa Finance Corp. First Union 30/360
520 0.095 Daiwa Finance Corp. First Union Actual/360
521 0.095 Daiwa Finance Corp. First Union Actual/360
522 0.095 Daiwa Finance Corp. First Union Actual/360
523 0.095 Daiwa Finance Corp. First Union Actual/360
524 0.095 Daiwa Finance Corp. First Union Actual/360
525 0.095 Daiwa Finance Corp. First Union Actual/360
526 0.095 Daiwa Finance Corp. First Union Actual/360
527 0.095 Daiwa Finance Corp. First Union Actual/360
528 0.095 Daiwa Finance Corp. First Union Actual/360
529 0.095 Daiwa Finance Corp. First Union Actual/360
530 0.095 Daiwa Finance Corp. First Union Actual/360
531 0.095 Daiwa Finance Corp. First Union Actual/360
533 0.095 Daiwa Finance Corp. First Union Actual/360
534 0.095 Daiwa Finance Corp. First Union Actual/360
537 0.095 Daiwa Finance Corp. First Union Yes Actual/360
538 0.095 Daiwa Finance Corp. First Union Actual/360
539 0.095 Daiwa Finance Corp. First Union Actual/360
532 0.095 Daiwa Finance Corp. First Union Actual/360
</TABLE>
(1) Primary and master servicing fee.
<PAGE>
EXHIBIT B
FORM OF CERTIFICATE OF AN OFFICER OF
DAIWA FINANCE CORP.
I, ______________________, hereby certify that I am an authorized signatory
of Daiwa Finance Corp., a New York corporation (the "Seller"), and that, based
upon information provided to me by appropriate officers, certify further as
follows, to the best of my knowledge:
1. The representations and warranties of the Seller in the Mortgage Loan
Purchase Agreement, dated as of March 1, 1998 (the "MLPA") 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.
2. The Seller has, in all material aspects, complied with all the
agreements and satisfied all the conditions on its part that are required
under the MLPA to be performed or satisfied at or prior to the date hereof.
IN WITNESS WHEREOF, I have executed this Certificate as of __________,
1998.
DAIWA FINANCE CORP.
By: ___________________________________
Name:
Title:
I, ______________________, a ________________ of the Seller, hereby certify
that ______________________ is an authorized signatory of the Seller and that
the signature appearing above is his genuine signature.
IN WITNESS WHEREOF, I have executed this Certificate as of __________,
1998.
By: ___________________________________
Name:
Title:
B-1
<PAGE>
EXHIBIT C
FORM OF LEGAL OPINION
The Mortgage Loan Seller is a New York corporation duly organized, validly
existing and in good standing under the laws of the State of New York, with full
corporate power and authority to own its assets and conduct its business as
presently conducted by it, to own the Mortgage Loans, and enter into and perform
its obligations under the Mortgage Loan Purchase Agreement.
The Mortgage Loan Purchase Agreement has been duly authorized, executed and
delivered by the Mortgage Loan Seller and constitutes the legal, valid and
binding obligations of the Mortgage Loan Seller, enforceable against the
Mortgage Loan Seller in accordance with the terms of the Mortgage Loan Purchase
Agreement, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally, and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law),
and except to the extent rights to indemnity and contribution may be limited by
applicable law.
The execution and delivery of the Mortgage Loan Purchase Agreement by the
Mortgage Loan Seller and the performance of its obligations under the Mortgage
Loan Purchase Agreement will not conflict with any provision of any federal or
State of New York law or regulation to which the Mortgage Loan Seller is
subject, or conflict with, result in a breach of or constitute a default under
any of the terms, conditions or provisions of any of the Mortgage Loan Seller's
organizational documents, or, to our knowledge, any agreement or instrument to
which the Mortgage Loan Seller is a party or by which it is bound, or any order
of a federal or State of New York court, regulatory body, administrative agency
or government body having jurisdiction over the Mortgage Loan Seller.
There is no action, suit, proceeding or investigation pending or
threatened, against the Mortgage Loan Seller in any court or by or before any
other governmental agency or instrumentality which would materially and
adversely affect the validity of the Mortgage Loans or the ability of the
Mortgage Loan Seller to carry out the transactions contemplated by this
Agreement.
5. No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Mortgage Loan Seller of or compliance by the Mortgage Loan
Seller with the Mortgage Loan Purchase Agreement or the consummation of the
transactions contemplated by the Mortgage Loan Purchase Agreement, other than
those which have been obtained by the Mortgage Loan Seller.
C-1
<PAGE>
Merrill Lynch Mortgage Investors, Inc. 1998-C2
SCHEDULE I
(i) Immediately prior to the sale, transfer and assignment of the Mortgage
Loans to the Company, the Mortgage Loan Seller had good and marketable title to,
and was the sole owner of, each Mortgage Loan;
(ii) The Mortgage Loan Seller is transferring such Mortgage Loan free and
clear of any and all liens, pledges, charges or security interests of any nature
encumbering such Mortgage Loan, and none of the Mortgage Note, the Mortgage or
any other related loan document prohibits such transfer;
(iii) Each related Mortgage Note, Mortgage, Assignment of Leases (if any)
and other agreement executed in connection with such Mortgage Loan is, a valid
and binding obligation of the related Mortgagor (subject to any non-recourse
provisions therein and any state anti-deficiency legislation), enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws affecting the
enforcement of creditors' rights generally, or by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and any lost note affidavit included in the Mortgage File in lieu of
a Mortgage Note does not impair the ability of the holder thereof to enforce the
terms of such Mortgage Note;
(iv) Each related Assignment of Leases, or, if none, the assignment of
leases and rents contained in the related Mortgage creates a valid, collateral
or first priority assignment of, or a valid first priority 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, 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;
(v) Each related assignment of Mortgage from the Mortgage Loan Seller to
the Trustee and any related assignment of Assignment of Leases, if any, and
assignment of any other agreement executed in connection with such Mortgage
Loan, from the Mortgage Loan Seller to the Trustee constitutes the legal, valid
and binding assignment from the Mortgage Loan Seller to the Trustee, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
liquidation, receivership, moratorium or other laws relating to or affecting
creditors' rights generally or by general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at law);
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(vi) Since origination, such Mortgage Loan has not been modified, altered,
satisfied, canceled, subordinated or rescinded, except, in each of the foregoing
instances, by written instruments that are a part of the related Mortgage File,
and, if required, 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 Company, and no material portion of the
related Mortgaged Property has been released from the lien of the related
Mortgage, in each case, in any manner which materially and adversely affects the
value of the Mortgage Loan or materially interferes with the security intended
to be provided by such Mortgage, and, except with respect to those Mortgage
Loans listed on Exhibit I-VI attached hereto which permit defeasance and
substitution of real property collateral, the terms of the related Mortgage do
not provide for release of any portion of the Mortgaged Property from the lien
of the Mortgage in any manner which materially and adversely affects the
security provided by the Mortgaged Property;
(vii) Each related Mortgage is a valid first lien on the related Mortgaged
Property (subject to the matters described in clause (viii) below), and such
Mortgaged Property is free and clear of any mechanics' and materialmen's liens
which are prior to or equal with the lien of the related Mortgage, except those
which are insured against by a lender's title insurance policy (as described in
clause (viii) below);
(viii) The lien of each related Mortgage as a first priority lien in the
outstanding principal amount of such Mortgage Loan (as set forth on the Mortgage
Loan Schedule) after all advances of principal is insured by an ALTA lender's
title insurance policy (or a binding commitment therefor), or its equivalent as
adopted in the applicable jurisdiction, insuring the Mortgage Loan Seller, its
successors and assigns, subject only to (a) the lien of current real property
taxes, ground rents, water charges, sewer rents and assessments not yet due and
payable, (b) covenants, conditions and restrictions, rights of way, easements
and other matters of public record, none of which, individually or in the
aggregate, materially interferes with the current use of the Mortgaged Property
or the security intended to be provided by such Mortgage or with the Mortgagor's
ability to pay its obligations when they become due or materially and adversely
affects the value of the Mortgaged Property, and (c) the exclusions and
exceptions (general and specific) set forth in such policy, none of which,
individually or in the aggregate, materially interferes with the security
intended to be provided by such Mortgage or with the Mortgagor's ability to pay
its obligations when they become due or materially and adversely affects the
value of the Mortgaged Property; the original holder of the Mortgage, and/or its
successor or assigns, are the sole named insureds under such policy; such policy
is assignable to the Company and the Trustee without the consent of or any
notification to the insurer, and is now in full force and effect
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and will remain so upon the consummation of the transactions contemplated by
this Agreement; no claims have been made under such policy, the Mortgage Loan
Seller has not done anything, by act or omission, and the Mortgage Loan Seller
has no knowledge of any matter, which would impair or diminish the coverage of
such policy;
(ix) The proceeds of such Mortgage Loan have been fully disbursed and there
is no requirement for future advances thereunder and the Mortgage Loan Seller
covenants that it will not make any future advances under the Mortgage Loan to
the related Mortgagor;
(x) The Mortgage Loan Seller has received no notice of any proceeding
pending, nor to the Mortgage Loan Seller's knowledge, threatened, for the total
or partial condemnation of all or any material portion of such Mortgaged
Property, and, to the Mortgage Loan Seller's knowledge, each related Mortgaged
Property is free and clear of any material damage that would affect materially
and adversely the value of such Mortgaged Property as security for the Mortgage
Loan.
(xi) Except as indicated on Exhibit I-XI(A) attached hereto, the related
Mortgagor has represented to the Mortgagee that, as of the date of origination
of such Mortgage Loan, and, to the Mortgage Loan Seller's knowledge, either (a)
such Mortgagor and the lessee and/or operator of the related Mortgaged Property
was in possession of all material licenses, permits and other authorizations
necessary and required by all applicable laws for the conduct of its business
and all such licenses, permits and authorizations were valid and in full force
and effect, or (b) such Mortgagor uses, operates, occupies and maintains the
Mortgaged Property in accordance with all applicable laws and regulations;
(xii) The Mortgage Loan does not have a shared appreciation feature, other
contingent interest feature or (except with respect to those Mortgage Loans
listed on Exhibit I-XII attached hereto (the "ARD Loans")) provide for
hyper-amortization, a negative amortization feature;
(xiii) The Mortgage Loan is a whole loan and no other party holds a
participation interest in such Mortgage Loan;
(xiv) The Mortgage Rate (exclusive of any default interest, late charges,
prepayment premiums or defeasance deposits) of each Mortgage Loan complied as of
the date of origination with, or such Mortgage Loan is exempt from, applicable
state or federal laws, regulations and other requirements pertaining to usury;
any and all other requirements of any federal, state or local laws, including,
without limitation, truth-in-lending, real estate settlement procedures, equal
credit opportunity or disclosure laws, applicable to each
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Mortgage Loan have been complied with as of the date of origination of such
Mortgage Loan;
(xv) All taxes and governmental assessments which would be a lien on the
Property and that prior to the Cut-Off Date became due and owing in respect of
each related Mortgaged Property have been paid, or an escrow of funds in an
amount sufficient to cover such payments has been established;
(xvi) Except as indicated on Exhibit I-XVI attached hereto, all escrow
deposits and payments required pursuant to the Mortgage Loan are in the
possession, or under the control, of the Mortgage Loan Seller or its agent and
all amounts required to be deposited by the Borrower under the Loan Documents as
of the date hereof have been deposited and all such escrows and deposits have
been conveyed by the Mortgage Loan Seller to the Company and identified as such
with appropriate detail;
(xvii) Except as indicated on Exhibit I-XVII, as of the date of its
origination, each related Mortgaged Property is insured by a fire and extended
perils insurance policy in an amount not less than the lesser of (A) the
outstanding principal balance of the Mortgage Loan and (B) the replacement cost
of the related Mortgaged Property, and in all events the amount necessary to
avoid the operation of any co-insurance provisions with respect to the Mortgaged
Property; with respect to each related Mortgaged Property, the Mortgagor is
required to maintain, for Mortgage Loans greater than $1,000,000, business
interruption insurance (or loss of rents insurance) and comprehensive general
liability insurance in amounts generally required by institutional lenders for
similar properties; all premiums on such insurance policies required to be paid
as of the date hereof have been paid; such insurance policies require prior
notice to the insured and to the Mortgagee of termination or cancellation, and
except for as indicated on Exhibit I-XVII, no such notice has been received;
each related Mortgage or loan agreement obligates the related Mortgagor to
maintain a fire and extended perils insurance and, at such Mortgagor's failure
to do so, authorizes the Mortgagee to maintain such insurance at the Mortgagor's
cost and expense and to seek reimbursement therefor from such Mortgagor;
(xviii) Each Mortgage provides that any insurance proceeds in respect of a
casualty, other than business interruption/rental income insurance, and any
condemnation awards or insurance proceeds, will be applied either to the repair
or restoration of the Mortgaged Property or to the repayment of the outstanding
principal balance of the Mortgage Loan;
(xix) (A) To the Mortgage Loan Seller's knowledge, there is no material
default, breach, violation or event of acceleration existing under the related
Mortgage or the related Mortgage Note, and no event (other than payments due but
not yet delinquent) which, with the passage of time or with
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notice and the expiration of any grace or cure period, would constitute a
material default, breach, violation or event of acceleration, and (B) the
Mortgage Loan Seller has not waived in writing any material 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;
(xx) No Monthly Payment on such Mortgage Loan has been more than 30 days
delinquent from the later of one year prior to the Cut-off Date, the date of
origination of such Mortgage Loan or, if applicable, the date of acquisition by
the Mortgage Loan Seller of such Mortgage Loan, through the Cut-off Date;
(xxi) Each related Mortgage contains customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate for the
realization against the Mortgaged Property of the benefits of the security,
including realization by judicial or, if applicable, non-judicial foreclosure,
subject to the effects of bankruptcy or other law affecting the right of
creditors generally and the application of principles of equity, and there is no
exemption available to the Mortgagor which would interfere with such right to
foreclose;
(xxii) Except as indicated on Exhibit I-XXII attached hereto, one or more
environmental site assessments were performed by an environmental consulting
firm independent of the Mortgage Loan Seller and the Mortgage Loan Seller's
affiliates with respect to related Mortgaged Property during the 18 month period
preceding the closing of the Mortgage Loan and the Mortgage Loan Seller, having
made no independent inquiry other than to review the report(s) prepared in
connection with the assessments referred to herein, has no knowledge of any
material and adverse environmental condition or circumstance affecting such
Mortgaged Property that was not disclosed in such report(s);
(xxiii) Each related Mortgage, Mortgage Note or loan agreement contains
provisions for the acceleration of the payment of the unpaid principal balance
of such Mortgage Loan if, without complying with the requirements of the
Mortgage or loan agreement, as applicable, the related Mortgaged Property, or
any controlling interest therein, is directly or indirectly transferred or sold
or is encumbered in connection with subordinate financing (other than any
existing subordinate debt);
(xxiv) Each Mortgage Loan constitutes a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended
(the "Code"). For this purpose, Section 860G(a)(3) of the Code shall be applied
without regard to the rule contained in Treasury Regulations Section
1.860G-2(f)(2) which treats a defective mortgage loan as
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a "qualified mortgage" under certain circumstances. Accordingly, the Mortgage
Loan Seller represents and warrants that each Mortgage Loan is directly secured
by a Mortgage on a commercial property or a multifamily residential property,
and either (1) substantially all of the proceeds of such Mortgage Loan were used
to acquire, improve or protect the portion of such commercial or multifamily
residential property that consists of an interest in real property and such
interest in real property was the only security for such Mortgage Loan as of the
Testing Date (as defined below), or (2) the fair market value of the interest in
real property which secures such Mortgage Loan was at least equal to 80% of the
principal amount of the Mortgage Loan (a) as of the Testing Date, or (b) as of
the Closing Date. For purposes of the previous sentence, (1) the fair market
value of the referenced interest in real property shall first be reduced by (a)
the amount of any lien on such interest in real property that is senior to the
Mortgage Loan, and (b) a proportionate amount of any lien on such interest in
real property that is on a parity with the Mortgage Loan, and (2) the "Testing
Date" shall be the date on which the referenced Mortgage Loan was originated
unless (a) such Mortgage Loan was modified after the date of its origination in
a manner that would cause a "significant modification" of such Mortgage Loan
within the meaning of Treasury Regulations Section 1.1001-3(b), and (b) such
"significant modification" did not occur at a time when such Mortgage Loan was
in default or when default with respect to such Mortgage Loan was reasonably
foreseeable. However, if the referenced Mortgage Loan has been subjected to a
"significant modification" after the date of its origination and at a time when
such Mortgage Loan was not in default or when default with respect to such
Mortgage Loan was not reasonably foreseeable, the Testing Date shall be the date
upon which the latest such "significant modification" occurred;
(xxv) As of the Cut-off Date the Mortgage Loan Schedule is true and correct
in all material respects;
(xxvi) Prepayment Premiums and Yield Maintenance Charges payable with
respect to the Mortgage Loan, if any, constitute "customary prepayment
penalties" within the meaning of Treasury Regulations Section 1.860G-1(b)(2);
(xxvii) The Mortgage File contains an appraisal of the related Mortgaged
Property, which appraisal is signed by a qualified appraiser who, to the
Mortgage Loan Seller's knowledge, had no interest, direct or indirect, in the
Mortgaged Property or in any loan made on the security thereof, and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and the appraisal and appraiser both satisfy the requirements of Title XI
of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and
the regulations promulgated thereunder, all as in effect on the date the
Mortgage Loan was originated;
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(xxviii) None of the material improvements which were included for the
purposes 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 such property (except Mortgaged Properties
which are legal non-conforming uses and/or except for immaterial encroachments
off of the Mortgaged Property or where the same is covered by a title insurance
endorsement or affirmative title insurance coverage), and no improvements on
adjoining properties materially encroach upon such Mortgaged Property, or the
requisite title insurance has been obtained with respect to the foregoing;
(xxix) The related Mortgagor has covenanted in the Mortgage Loan documents
to maintain the related Mortgaged Property in compliance with all applicable
laws, zoning (including legal non-conforming uses), ordinances rules, covenants
and restrictions affecting the construction, occupancy, use and operation of
such Mortgaged Property, and the related originator performed the type of due
diligence in connection with the origination of such Mortgage Loan customarily
performed by prudent institutional commercial and multifamily mortgage lenders
with respect to the foregoing matters; the Mortgage Loan Seller has received no
notice of any material violation of any applicable laws, zoning ordinances,
rules, covenants or restrictions affecting the construction, occupancy, use or
operation of such Mortgaged Property;
(xxx) Except as indicated on Exhibit I-XXX(A), With respect to the Mortgage
Loans which as of the Cut-off Date have a principal balance of at least $15
million, the related Mortgagor is an entity which has represented and covenanted
in connection with the origination of the Mortgage Loan, or whose organizational
documents provide, that so long as the Mortgage Loan is outstanding it will be a
single-purpose entity. For this purpose, "single-purpose entity" shall mean a
person, other than an individual, which does not engage in any business
unrelated to the related Mortgaged Property (which may include multiple
Mortgaged Properties owned by the same Borrower and securing only Mortgage Loans
conveyed hereunder as listed on Exhibit I-XXX(B)) and its (or their) financing,
does not have any material assets other than those related to its interest in
such Mortgaged Property (or Mortgaged Properties) or its (or their) financing,
or any indebtedness other than as permitted by the related Mortgage or the other
documents in the Mortgage Loan File, and such Mortgagor has covenanted under the
Mortgage that it will maintain its own books and records separate and apart from
any other person, and holds itself out as being a legal entity, separate and
apart from any other person;
(xxxi) The Mortgage Loan complied, in all material respects, with all of
the terms, conditions and requirements of the Mortgage Loan Seller's applicable
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underwriting standards in effect at the time of the origination or acquisition
of such Mortgage Loan;
(xxxii) The Mortgage Loan Seller has no knowledge nor has it received any
notice that any Mortgagor is a debtor in any state or federal bankruptcy or
insolvency proceeding;
(xxxiii) To the best of Mortgage Loan Seller's knowledge, as of the Closing
Date, there is no right of rescission, offset, abatement, diminution, defense or
counterclaim to the Mortgage Loan (including the defense of usury), nor will the
operation of any of the terms of the Mortgage Note or the Mortgage, or the
exercise of any rights thereunder, render the Mortgage Note or the Mortgage
unenforceable, in whole or in part (excluding provisions relating to default
interest, yield maintenance charges, prepayment premiums or defeasance
deposits), or subject to any right of rescission, offset, abatement, diminution,
valid defense or counterclaim (including the defense of usury or the violation
of any applicable disclosure or consumer credit laws), except in any such case
as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other laws affecting the enforcement of creditors' rights
generally or by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), and no such
right of rescission, offset, abatement, diminution, defense or counterclaim has
been asserted with respect thereto;
(xxxiv) In the case of any Mortgage which is a deed of trust, a trustee,
duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in the deed of trust or has been
substituted in accordance with applicable law, and no fees or expenses are, or
will become, payable to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the Mortgagor or in connection
with the release of the Mortgaged Property or related security for the Mortgage
Loan following the payment of the Mortgage Loan in full;
(xxxv) The improvements located on the Mortgaged Property are either not
located in a federally designated special flood hazard area designated by the
Federal Emergency Management Agency as Zone A or Zone V or the Mortgagor is
required to maintain or the Mortgagee maintains, flood insurance with respect to
such improvements;
(xxxvi) If the Mortgaged Property is subject to any leases, the Mortgagor
is the owner and holder of the landlord's interest under any leases and the
related Mortgage or Assignment of Leases provides for the appointment of a
receiver for rents (in accordance with applicable law) or allows the Mortgagee
(in accordance with applicable law) to enter into possession to collect rent or
provides for rents to be paid directly to Mortgagee;
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(xxxvii) The Mortgage Note is not secured by any collateral that is not
being transferred hereunder;
(xxxviii) Each Mortgage Loan, if any, that is cross-collateralized is
cross-collateralized only with one or more other Mortgage Loans being
transferred hereunder;
(xxxix) The origination (or acquisition, as the case may be), servicing and
collection practices used with respect to the Mortgage Loan by the Mortgage Loan
Seller and, to the Mortgage Loan Seller's knowledge, by any prior holder of the
Mortgage Loan, have been in all respects legal, proper and prudent in all
material respects and have met customary industry standards;
(xl) No advance of funds has been made other than pursuant to the loan
documents, directly or indirectly, by the Mortgage Loan Seller to the Mortgagor
and, except as indicated on Exhibit I-XL attached hereto, to the Mortgage Loan
Seller's knowledge, no funds have been received from any person other than the
Mortgagor, for or on account of payments due on the Mortgage Note or the
Mortgage;
(xli) UCC Financing Statements have been filed and/or recorded in all
places necessary to perfect a valid security interest in all material furniture,
fixtures and equipment owned by a Mortgagor and located on each Mortgaged
Property and for which perfection is accomplished by the filing of a UCC
financing statement, and the mortgages, security agreements, chattel mortgages
or equivalent documents related to and delivered in connection with the related
Mortgage Loans establish and create a valid and enforceable first lien and first
priority security interest on such material furniture, fixtures and equipment
except as enforceability may be limited by bankruptcy or other laws affecting
creditor's rights generally or by the application of the rules of equity;
(xlii) Except as indicated on Exhibit I-XLII attached hereto as being
subject to subordinate debt secured by a subordinate mortgage encumbering the
related Mortgaged Property (the "Subordinate Debt Mortgage Loans"), as of the
date of the Prospectus, to the Mortgage Loan Seller's knowledge, the Mortgagor
has no indebtedness for borrowed money secured by a mortgage encumbering the
Mortgaged Property other than the Mortgage Loan. Except as indicated in Exhibit
I-XLII, with respect to the Subordinate Debt Mortgage Loans, the creditor (the
"Subordinate Lender") under such secured indebtedness for borrowed money ("Other
Debt") of the Mortgagor has entered into a subordination agreement with the
Mortgage Loan Seller (or the Mortgage Loan originator) pursuant to which (A) the
Subordinate Lender has agreed to fully subordinate the Other Debt to the
Mortgage Loan (collectively, the "Senior Debt"), (B) the Subordinate Lender has
agreed not to declare a default or exercise any remedies with respect to the
Other Debt until the
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full, and (C) such subordination agreement is assignable to the Company and its
successors and assigns and is being assigned hereunder and is part of the
Mortgage File;
(xliii) 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 I-XLIII and, 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 the amount set forth in Exhibit I-XLIII attached hereto;
(xliv) The Mortgage Loan has an interest rate of at least 6.91% per annum;
(xlv) The Mortgage Loan is non-recourse to the related Mortgagor (or its
principals) except for certain circumstances including fraud, misappropriation,
material misrepresentation and other matters expressly set forth in the related
Mortgage Loan documents;
(xlvi) The Mortgage Loan Seller (or Mortgage Loan originator) has inspected
or caused to be inspected each related Mortgage Property within twelve months of
origination;
(xlvii) Except as set forth in Schedule II, the Mortgage Loan is not
secured in whole or in part by a ground lease; and
(xlviii) 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 Mortgaged Property that, if determined
adversely to such Mortgagor, would materially and adversely affect the ability
of the Mortgagor to pay principal, interest or any other amount due under such
Mortgage Loan.
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SCHEDULE II
For each Mortgage Loan identified on the Mortgage Loan Schedule as a ground
lease, the Mortgage Loan Seller hereby represents and warrants:
(A)(i) the Mortgage Loan is also secured by the related fee interest or
(ii) the ground lease represents a non-essential portion of the Mortgaged
Property, and the ground lease has an original term (or an original term plus
one or more optional renewal terms, which, under all circumstances, may be
exercised, and will be enforceable, by the Mortgagor, or the Mortgagee if the
Mortgagee acquires the related Mortgaged Property upon foreclosure,
assignment-in-lieu of foreclosure or otherwise) that extends not less than 10
years beyond the stated maturity of the related Mortgage Loan, or
(B) if the Mortgage Loan is secured by a Mortgage constituting a valid
first lien on an unencumbered interest of the Borrower as lessee under a ground
lease underlying the related Mortgaged Property, then the Mortgage Loan Seller
represents and warrants the following:
(i) The ground lease (which shall mean such ground lease, all amendments
and modifications thereof and any related estoppels or agreements from ground
lessor) or a memorandum regarding it has been duly recorded. The ground lease
permits the interest of the lessee to be encumbered by the related Mortgage and
does not restrict the use of the related Mortgaged Property by such lessee, its
successors or assigns in a manner that would adversely affect the security
provided by the related Mortgage. There has been no material change in the terms
of such ground lease since its recordation, except by written instruments, all
of which are included in the related Mortgage File;
(ii) The lessor under such ground lease has agreed in a writing included in
the related Mortgage File that the 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, except if an event of default occurs under the Ground
Lease and notice is provided to the Mortgagee and such default is curable by the
Mortgagee, but remains uncured beyond the applicable cure period;
(iii) The ground lease has an original term (or an original term plus one
or more optional renewal terms, which, under all circumstances, may be
exercised, and will be enforceable, by the Mortgagee) that extends not less than
10 years beyond the stated maturity of the related Mortgage Loan;
(iv) The ground lease is not subject to any liens or encumbrances superior
to, or of equal priority with, the
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Mortgage (including without limitation, the rights of any fee-mortgage, if any)
other than the related ground lessor's related fee interest and any exceptions
set forth in the related title insurance policy or opinion of title;
(v) The ground lease is assignable to the Mortgagee and its assigns without
the consent of the lessor thereunder (or, if any such consent is required, it
has been obtained prior to the Closing Date);
(vi) As of the date of origination of the Mortgage Loan, and to the
Mortgage Loan Seller's knowledge as of the Cut-off Date, the ground lease is in
full force and effect and no default has occurred, nor is there any existing
condition which, but for the passage of time or giving of notice, would result
in a default under the terms of the ground lease;
(vii) The ground lease or ancillary agreement between the lessor and the
lessee requires the lessor to give notice of any default by the lessee to the
Mortgagee. The ground lease or ancillary agreement further provides that either
no notice given is effective or no termination of the lease in connection
therewith will be effective against the Mortgagee unless written notice of such
default or a copy thereof has been given to the Mortgagee in a manner described
in the ground lease or ancillary agreement;
(viii) The Mortgagee is permitted a reasonable opportunity, which may be
concurrent and coterminous with the Mortgagor's rights thereunder (including,
where necessary, sufficient time to gain possession of the interest of the
lessee under the ground lease through legal proceedings, or to take other action
so long as the Mortgagee is proceeding) to cure any default under the ground
lease which is curable after the receipt of notice of any default before the
lessor may terminate the ground lease;
(ix) The ground lease does not impose any restrictions on subletting by the
Mortgagee that would be viewed as commercially unreasonable by a prudent
commercial mortgage lender;
(x) The ground lease provides that any related insurance proceeds or
condemnation award (other than in respect of a total or substantially total loss
or taking) will be applied either to the repair or restoration of all or part of
the related Mortgaged Property, with the Mortgagee or a trustee appointed by it
having the right to hold and disburse such proceeds as repair or restoration
progresses, or, in the case of condemnation, assigned to the mortgagee, or in
the case of casualty to Tenants, to the payment of the outstanding principal
balance of the Mortgage Loan, together with any accrued interest (except in
cases where a different allocation would not be viewed as commercially
unreasonable by any institutional investor, taking
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into account the relative duration of the ground lease and the related Mortgage
and the ratio of the market value of the related Mortgaged Property to the
outstanding principal balance of such Mortgage Loan);
(xi) Until the principal balance and accrued interest are paid in full,
neither the lessee nor the lessor under the ground lease will have the option to
terminate or modify the ground lease without prior written consent of the
Mortgagee as a result of any casualty or partial condemnation, except to provide
for an abatement of the rent;
(xii) 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 upon the rejection of the lease
in bankruptcy; and
(xiii) Except as set forth on Exhibit II-XIII attached hereto, the ground
lease does not provide for an increase in rental payments.
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SCHEDULE III
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:
(i) Except as indicated on Exhibit III-I, attached hereto, 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 number of beds, and approved
provider status in any approved provider payment program (collectively, the
"Licenses");
(ii) 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.
(iii) As of the Cut-off Date and to Mortgage Loan 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.
<PAGE>
EXHIBIT I-XI (A)
None.
<PAGE>
EXHIBIT I-XII
None.
<PAGE>
EXHIBIT I-XVI
None.
<PAGE>
EXHIBIT I-XVII
Insurance cancellation/termination notices have been received for the following
Mortgaged Properties:
1. Control Number 453 - Canberra Apartments - notice of cancellation was
received in February 1998 and indicating that the policy in effect
from March 29, 1997 to March 29, 1998 would expire on March 29, 1998.
However, it has been renewed for one year.
2. Control Number 521 - Claridge Manor Apartments - on March 19, 1998
insurance agent advised us that the Notice of Cancellation or
Nonrenewal was issued in error. All policy premiums are current and
all policies are in effect.
<PAGE>
EXHIBIT I-XXII
Control Number 302 Stoneyfield Estates
The initial environmental assessment was performed 19 months prior to the
closing of this Mortgage Loan.
<PAGE>
EXHIBIT I-XL
None.
<PAGE>
EXHIBIT I-XLII
Control Number 435 Lanier Place is subject to a subordinate mortgage. Clause (A)
in section (xlii) is true but clauses (B) and (C) in section (xlii) are not true
with respect to this Mortgaged Property.
<PAGE>
EXHIBIT II-XIII
None.
<PAGE>
EXHIBIT III-(i)
None.
<PAGE>
<TABLE>
<CAPTION>
DFC MULTI PROP
EXHIBIT I-XXX
ONE BORROWER MULTIPLE PROPERTIES
CONTROL LOAN MORTGAGE CUT-OFF
NUMBER NUMBER LOAN SELLER PROPERTY NAME LOAN AMOUNT AFFILIATION
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
540 215349 Daiwa Finance Corp. Aggregate Loan Level Info. 1,263,319
540A 215349A Daiwa Finance Corp. New Haven Apartments 525,388 Cntrl #'s 540B,540C
540B 215349B Daiwa Finance Corp. Westchester Apartments 499,118 Cntrl #'s 540A,540C
540C 215349C Daiwa Finance Corp. Willowdale Apartments 238,813 Cntrl #'s 540A,540B
362 215352 Daiwa Finance Corp. Aggregate Loan Level Info. 609,599
362A 215352A Daiwa Finance Corp. Shadyedge Apartments 135,467 Cntrl # 362B
362B 215352B Daiwa Finance Corp. Tudor Court Apartments 474,133 Cntrl # 362A
418 215820 Daiwa Finance Corp. Windsor Apartments 422,567 Cntrl #'s 419, 420
419 215821 Daiwa Finance Corp. Willow Pointe Apartments 661,194 Cntrl #'s 418, 420
420 215822 Daiwa Finance Corp. Southtown Apartments 323,140 Cntrl #'s 418, 419
466 217444 Daiwa Finance Corp. Seligson Portfolio - 605 West Avenue 4,133,387 Cntrl #'s 467, 468
467 217445 Daiwa Finance Corp. Seligson Portfolio - 698 West Avenue 1,444,195 Cntrl #'s 466, 468
</TABLE>
Page 1
<PAGE>
<TABLE>
<CAPTION>
DFC AFFL
EXHIBIT I-XLIII
BORROWERS OR GROUPS OF AFFILIATED BORROWERS WITH MULTIPLE MORTGAGE LOANS
CONTROL LOAN MORTGAGE CUT-OFF
NUMBER NUMBER LOAN SELLER PROPERTY NAME LOAN AMOUNT
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
543 217439 Daiwa Finance Corp. Castille Court Apartments 482,836
465 217440 Daiwa Finance Corp. The Villages Apartment 632,167
----------
Total 1,115,004
410 215590 Daiwa Finance Corp. Vanowen Street Apartments 575,964
411 215591 Daiwa Finance Corp. Saticoy Street Apartments 1,097,312
412 215592 Daiwa Finance Corp. Bombay Apartments 705,060
----------
Total 2,378,336
425 215827 Daiwa Finance Corp. Stardust Apartments 377,576
515 9906 Daiwa Finance Corp. Windsong Apartments 398,831
----------
Total 776,408
495 2222 Daiwa Finance Corp. Glenoaks Apartments 1,064,675
497 4444 Daiwa Finance Corp. Village Meadows 458,998
----------
Total 1,523,673
418 215820 Daiwa Finance Corp. Windsor Apartments 422,567
419 215821 Daiwa Finance Corp. Willow Pointe Apartments 661,194
420 215822 Daiwa Finance Corp. Southtown Apartments 323,140
----------
Total 1,406,901
403 215404 Daiwa Finance Corp. Steele Street Apartments 213,908
404 215405 Daiwa Finance Corp. Williams Street Apartments 248,650
----------
Total 462,558
307 1009 Daiwa Finance Corp. Windrush Apartments 3,719,057
308 1010 Daiwa Finance Corp. Woodbury Place Apartments 7,438,115
316 1018 Daiwa Finance Corp. Rockledge Apartments 5,882,521
317 1019 Daiwa Finance Corp. Carmel Apartments 1,495,556
----------
Total 18,535,250
320 1022 Daiwa Finance Corp. Mill Village 2,688,338
321 1023 Daiwa Finance Corp. Cedar Professional Building 1,458,570
322 1024 Daiwa Finance Corp. South Water Street 2,588,588
323 1025 Daiwa Finance Corp. Wellesley Marketplace 1,792,099
----------
Total 8,527,594
372 215363 Daiwa Finance Corp. Courtyard Apartments 1,101,562
373 215364 Daiwa Finance Corp. Century Heights Apartments 482,166
374 215365 Daiwa Finance Corp. Western Crest Apartments 603,035
----------
Total 2,186,763
505 80120 Daiwa Finance Corp. Ramsey Apartments 844,531
506 80121 Daiwa Finance Corp. Glendale Apartments 844,531
507 80122 Daiwa Finance Corp. Burton Gardens Apartments 1,142,601
----------
Total 2,831,663
319 1021 Daiwa Finance Corp. Days Inn Busch Gardens 3,930,805
330 1032 Daiwa Finance Corp. Days Inn - Fort Lauderdale 2,736,636
----------
Total 6,667,441
346 215325 Daiwa Finance Corp. Le Chateau Apartments 464,137
354 215340 Daiwa Finance Corp. Woodland View Apartments 870,369
371 215359 Daiwa Finance Corp. Chestnut Hill Apartments 525,411
381 215374 Daiwa Finance Corp. Regal Oaks Apartments 386,353
----------
Total 2,246,270
395 215395 Daiwa Finance Corp. Silver Club Apartments 493,443
396 215396 Daiwa Finance Corp. Beechnut Palms Apartments 986,885
----------
Total 1,480,328
499 6666 Daiwa Finance Corp. Tahiti Village Apartments 1,496,770
518 9909 Daiwa Finance Corp. Parkwood Apartments 1,123,692
526 9917 Daiwa Finance Corp. Tropic Isle Apartments 898,608
527 9918 Daiwa Finance Corp. Leisure Isle Apartments 1,021,418
528 9919 Daiwa Finance Corp. Laurel Apartments 299,536
529 9920 Daiwa Finance Corp. La Mesa Apartments 522,191
530 9921 Daiwa Finance Corp. Villa Fontana Apartments 1,198,144
531 9922 Daiwa Finance Corp. Park Lane Apartments 1,048,376
----------
Total 7,608,736
386 215383 Daiwa Finance Corp. Burlington Townhomes 347,194
388 215387 Daiwa Finance Corp. Abbey Arms Apartments 488,428
428 215883 Daiwa Finance Corp. Shea Terrace Apartments 187,655
----------
Total 1,023,277
<CAPTION>
CONTROL
NUMBER LIST CNTRL# OF AFFILIATED LOANS AFFILIATES
- --------------------------------------------------------------------------
<S> <C>
543 Cntrl # 465 Briggs
465 Cntrl # 543 Briggs
Total
410 Cntrl #'s 411, 412 Cooperman
411 Cntrl #'s 410, 412 Cooperman
412 Cntrl #'s 410, 411 Cooperman
Total
425 Cntrl # 515 Criswell
515 Cntrl # 425 Criswell
Total
495 Cntrl # 497 Danny Thomas
497 Cntrl # 495 Danny Thomas
Total
418 Cntrl #'s 419, 420 Dayringer
419 Cntrl #'s 418, 420 Dayringer
420 Cntrl #'s 418, 419 Dayringer
Total
403 Cntrl # 404 Elaine Cunningham
404 Cntrl # 403 Elaine Cunningham
Total
307 Cntrl #'s 308, 316, 317 Flanagan
308 Cntrl #'s 307, 316, 317 Flanagan
316 Cntrl #'s 307, 308, 317 Flanagan
317 Cntrl #'s 307, 308, 316 Flanagan
Total
320 Cntrl #'s 321, 322, 323 Goldberg
321 Cntrl #'s 320, 322, 323 Goldberg
322 Cntrl #'s 320, 321, 323 Goldberg
323 Cntrl #'s 320,321, 322 Goldberg
Total
372 Cntrl #'s 373, 374 Hurt
373 Cntrl #'s 372, 374 Hurt
374 Cntrl #'s 372, 373 Hurt
Total
505 Cntrl #'s 506, 507 Johnson
506 Cntrl #'s 505, 507 Johnson
507 Cntrl #'s 505, 506 Johnson
Total
319 Cntrl # 330 Mednick
330 Cntrl # 319 Mednick
Total
346 Cntrl #'s 354, 371, 381 Miles
354 Cntrl #'s 346, 371, 381 Miles
371 Cntrl #'s 346, 354, 381 Miles
381 Cntrl #'s 346, 354, 371 Miles
Total
395 Cntrl # 396 Nguyen
396 Cntrl # 395 Nguyen
Total
499 Cntrl #'s 518, 526, 527, 528, 529, 530, 531 Nijjar
518 Cntrl #'s 499, 526, 527, 528, 529, 530, 531 Nijjar
526 Cntrl #'s 499, 518, 527, 528, 529, 530, 531 Nijjar
527 Cntrl #'s 499, 518, 526, 528, 529, 530, 531 Nijjar
528 Cntrl #'s 499, 518, 526, 527, 529, 530, 531 Nijjar
529 Cntrl #'s 499, 518, 526, 527, 528, 530, 531 Nijjar
530 Cntrl #'s 499, 518, 526, 527, 528, 529, 531 Nijjar
531 Cntrl #'s 499, 518, 526, 527, 528, 529, 530 Nijjar
Total
386 Cntrl #'s 388, 428 Nusbaum
388 Cntrl #'s 386, 428 Nusbaum
428 Cntrl #'s 388, 386 Nusbaum
Total
</TABLE>
Page 1
<PAGE>
<TABLE>
<CAPTION>
DFC AFFL
EXHIBIT I-XLIII
BORROWERS OR GROUPS OF AFFILIATED BORROWERS WITH MULTIPLE MORTGAGE LOANS
CONTROL LOAN MORTGAGE CUT-OFF
NUMBER NUMBER LOAN SELLER PROPERTY NAME LOAN AMOUNT
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
304 1005 Daiwa Finance Corp. Northgate Distribution Center 4,678,099
337 1038 Daiwa Finance Corp. Corporate Center at Beaumeade 6,982,306
510 9901 Daiwa Finance Corp. Corporate Point Office Building 4,010,310
----------
Total 15,670,715
384 215380 Daiwa Finance Corp. Darling Street Apartments 1,268,746
438 215893 Daiwa Finance Corp. 37 Wales Street 411,771
440 215896 Daiwa Finance Corp. Dorchester Apartments 775,220
----------
Total 2,455,737
466 217444 Daiwa Finance Corp. Seligson Portfolio - 605 West Avenue 4,133,387
467 217445 Daiwa Finance Corp. Seligson Portfolio - 698 West Avenue 1,444,195
468 217446 Daiwa Finance Corp. Seligson Portfolio - 17 Butler Street 5,577,583
----------
Total 11,155,165
310 1012 Daiwa Finance Corp. Ramada Inn Foothills 3,777,705
311 1013 Daiwa Finance Corp. Days Inn Coliseum 4,672,425
----------
Total 8,450,130
444 215900 Daiwa Finance Corp. Shadow Oaks Apartments 293,744
445 215901 Daiwa Finance Corp. Kimberly Oaks Apartments 331,455
----------
Total 625,199
365 215353 Daiwa Finance Corp. Crotona Avenue 707,234
366 215354 Daiwa Finance Corp. 1020 & 1030 Boynton Avenue 1,433,583
----------
Total 2,140,817
447 215906 Daiwa Finance Corp. Mansard Place Apartments 1,786,541
448 215907 Daiwa Finance Corp. Broadway Park Apartments 2,173,625
----------
Total 3,960,167
<CAPTION>
CONTROL
NUMBER LIST CNTRL# OF AFFILIATED LOANS AFFILIATES
- ---------------------------------------------------------------------------
<S> <C>
304 Cntrl #'s 337, 510 Paulsen
337 Cntrl #'s 304, 510 Paulsen
510 Cntrl #'s 304, 337 Paulsen
Total
384 Cntrl #'s 438, 440 Raimondi
438 Cntrl #'s 384, 440 Raimondi
440 Cntrl #'s 384, 438 Raimondi
Total
466 Cntrl #'s 467, 468 Seligson
467 Cntrl #'s 466, 468 Seligson
468 Cntrl #'s 466, 467 Seligson
Total
310 Cntrl # 311 Shoecraft
311 Cntrl # 310 Shoecraft
Total
444 Cntrl # 445 Stancliff
445 Cntrl # 444 Stancliff
Total
365 Cntrl # 366 Tobacco
366 Cntrl # 365 Tobacco
Total
447 Cntrl # 448 Wolverine
448 Cntrl # 447 Wolverine
Total
</TABLE>
Page 2
<PAGE>
<TABLE>
<CAPTION>
DFC def Loans
EXHIBIT I-VI
DEFEASANCE LOANS
CONTROL LOAN MORTGAGE CUT-OFF
NUMBER NUMBER LOAN SELLER PROPERTY NAME LOAN AMOUNT
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
300 1001 Daiwa Finance Corp. Spring Branch Estates Apartments 2,048,229
301 1002 Daiwa Finance Corp. Holiday Inn Cortland 2,646,054
302 1003 Daiwa Finance Corp. Stoney Fields Estates 1,599,660
303 1004 Daiwa Finance Corp. Waters Edge Apartments 4,664,962
304 1005 Daiwa Finance Corp. Northgate Distribution Center 4,678,099
305 1006 Daiwa Finance Corp. Ebbets Field Apartments 17,638,089
306 1008 Daiwa Finance Corp. The Grand Hotel 8,440,020
307 1009 Daiwa Finance Corp. Windrush Apartments 3,719,057
308 1010 Daiwa Finance Corp. Woodbury Place Apartments 7,438,115
309 1011 Daiwa Finance Corp. Promenade Shopping Center - Palm Beach Gardens 15,240,669
310 1012 Daiwa Finance Corp. Ramada Inn Foothills 3,777,705
311 1013 Daiwa Finance Corp. Days Inn Coliseum 4,672,425
312 1014 Daiwa Finance Corp. Ramada Inn - Bordentown 3,594,409
313 1015 Daiwa Finance Corp. Comfort Inn - Maingate 7,158,866
316 1018 Daiwa Finance Corp. Rockledge Apartments 5,882,521
317 1019 Daiwa Finance Corp. Carmel Apartments 1,495,556
318 1020 Daiwa Finance Corp. Napa Town Center 6,470,704
320 1022 Daiwa Finance Corp. Mill Village 2,688,338
321 1023 Daiwa Finance Corp. Cedar Professional Building 1,458,570
322 1024 Daiwa Finance Corp. South Water Street 2,588,588
323 1025 Daiwa Finance Corp. Wellesley Marketplace 1,792,099
328 1030 Daiwa Finance Corp. The Majestic Hotel 5,684,840
331 1033 Daiwa Finance Corp. Timmons Place & Timmons Square 3,188,784
333 1035 Daiwa Finance Corp. Palm Glen Shopping Center 9,483,916
334 1036 Daiwa Finance Corp. Fairway Shopping Center 947,804
337 1038 Daiwa Finance Corp. Corporate Center at Beaumeade 6,982,306
338 1039 Daiwa Finance Corp. The Village Mall Shopping Center 2,145,621
340 1041 Daiwa Finance Corp. First Hill Medical Building 15,838,528
341 1042 Daiwa Finance Corp. Promenade Shopping Center - Highlands Ranch, Colorado 7,687,935
536 1044 Daiwa Finance Corp. Fort Williams Square Shopping Center 2,246,537
466 217444 Daiwa Finance Corp. Seligson Portfolio - 605 West Avenue 4,133,387
467 217445 Daiwa Finance Corp. Seligson Portfolio - 698 West Avenue 1,444,195
468 217446 Daiwa Finance Corp. Seligson Portfolio - 17 Butler Street 5,577,583
510 9901 Daiwa Finance Corp. Corporate Point Office Building 4,010,310
511 9902 Daiwa Finance Corp. Great Western Bank Building 3,191,482
537 9925 Daiwa Finance Corp. Ramada Inn - Katy 1,594,600
</TABLE>
Page 1
1998-C2
Daiwa Real Estate Finance Corp.
MORTGAGE LOAN PURCHASE AGREEMENT
This Mortgage Loan Purchase Agreement, dated as of March 1, 1998 (the
"Agreement"), is between Merrill Lynch Mortgage Investors, Inc., a Delaware
corporation (the "Company"), and Daiwa Real Estate Finance Corp., a Delaware
corporation (the "Mortgage Loan Seller"). The Mortgage Loan Seller agrees to
sell, and the Company agrees to purchase, the mortgage loans (the "Mortgage
Loans") described in, and set forth in, the Mortgage Loan Schedule attached as
Exhibit A to this Agreement (the "Mortgage Loan Schedule"). The Company intends
to deposit the Mortgage Loans and other assets into a trust (the "Trust") and
cause the creation of a series of certificates to be known as Merrill Lynch
Mortgage Investors, Inc., Mortgage Pass-Through Certificates, Series 1998-C2
(the "Certificates"), evidencing beneficial ownership interests in the Mortgage
Loans and other assets (including, without limitation, other mortgage loans),
under a Pooling and Servicing Agreement, to be dated as of March 1, 1998 (the
"Pooling and Servicing Agreement"), among the Company, as depositor, First Union
National Bank, as master servicer (the "Servicer"), CRIIMI MAE Services Limited
Partnership, as special servicer (the "Special Servicer"), and Norwest Bank
Minnesota, National Association, as trustee (the "Trustee"). Capitalized terms
used but not otherwise defined herein shall have the respective meanings given
to them in the Pooling and Servicing Agreement without giving effect to any
amendment thereto unless the Mortgage Loan Seller has given its consent to such
amendment in writing and signed by a duly authorized officer of the Mortgage
Loan Seller.
1. Purchase Price; Purchase and Sale. The purchase price (the "Purchase
Price") for the Mortgage Loans shall consist of a cash amount equal to (i) 100%
of the outstanding principal balance of the Mortgage Loans as of the Cut-Off
Date plus (ii) interest accrued on the Mortgage Loans at the related Mortgage
Rate up to but excluding the Closing Date. The Purchase Price amount shall be
payable by the Company to the Mortgage Loan Seller on March 27, 1998 or such
other date as shall be mutually acceptable to the parties hereto (the "Closing
Date") in immediately available funds. The closing for the purchase and sale of
the Mortgage Loans shall take place at the offices of Willkie Farr & Gallagher,
153 East 53rd Street, New York, New York 10022, at 10:00 a.m. (New York time),
on the Closing Date.
On the Closing Date, the Mortgage Loan Seller shall sell, transfer, assign,
set over and convey to the Company, without recourse, and the Company shall
purchase, all the right, title and interest of the Mortgage Loan Seller in and
to the Mortgage Loans, including all interest and principal due on or with
respect to the Mortgage Loans after the Cut-Off Date, together with all of the
Mortgage Loan Seller's right, title and interest in and to the proceeds of any
related title, hazard, primary mortgage or other insurance policies. All
scheduled payments of interest and principal due before the Cut-Off Date
<PAGE>
but collected on or after the Cut-Off Date, and recoveries of interest and
principal collected before the Cut-Off Date, shall belong to, and be promptly
remitted to the Mortgage Loan Seller. The Company hereby directs the Mortgage
Loan Seller, and the Mortgage Loan Seller hereby agrees, to deliver to each of
the Trustee, the Master Servicer and the Special Servicer all documents,
instruments and agreements required to be delivered by the Company to the
Trustee, the Master Servicer and the Special Servicer under Section 2.01 of the
Pooling and Servicing Agreement, and meeting all the requirements of such
Section 2.01 and such other documents, instruments and agreements as the Company
or the Trustee, the Master Servicer and the Special Servicer shall reasonably
request. The Mortgage Loan Schedule may be amended to reflect the actual
Mortgage Loans.
2. Representations and Warranties. (a) The Mortgage Loan Seller hereby
represents and warrants to the Company as of the date hereof and as of Closing
Date that:
(i) The Mortgage Loan Seller is a Delaware corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware, with the necessary corporate power and authority to own its
assets and conduct its business as now being conducted, is duly qualified
as a foreign corporation in good standing in all jurisdictions in which the
ownership or lease of its property or the conduct of its business requires
such qualification, except where the failure to be so qualified would not
have a material adverse effect on the value of the Mortgage Loans and the
ability of the Mortgage Loan Seller to perform its obligations hereunder,
and the Mortgage Loan Seller has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement by it,
and has the necessary corporate power and authority to execute, deliver and
perform this Agreement and all the transactions contemplated hereby,
including, but not limited to, the power and authority to sell, assign,
transfer, set over and convey the Mortgage Loans in accordance with this
Agreement;
(ii) This Agreement has been duly authorized, executed and delivered by the
Mortgage Loan Seller and assuming the due authorization, execution and
delivery by the Company, will constitute a legal, valid and binding
obligation of the Mortgage Loan Seller, enforceable against the Mortgage
Loan Seller in accordance with the terms of this Agreement, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the
-2-
<PAGE>
enforcement of creditors' rights generally, and by general principles of
equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law), 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 Mortgage Loan
Seller and the performance of its obligations hereunder (1) will not
conflict with any provision of any law or regulation to which the Mortgage
Loan Seller is subject, or conflict with, result in a breach of or
constitute a default under any of the terms, conditions or provisions of
any of the Mortgage Loan Seller's organizational documents or any agreement
or instrument to which the Mortgage Loan Seller is a party or by which it
is bound, or any order or decree applicable to the Mortgage Loan Seller, or
result in the creation or imposition of any lien on any of the Mortgage
Loan Seller's assets or property, in each case which would materially and
adversely affect the ability of the Mortgage Loan Seller to carry out the
transactions contemplated by this Agreement; and (2) does not require the
consent of any third party or such consent has been obtained.
(iv) There is no action, suit, proceeding or investigation pending or, to
the knowledge of the Mortgage Loan Seller, threatened against the Mortgage
Loan Seller in any court or by or before any other governmental agency or
instrumentality which, in the Mortgage Loan Seller's good faith and
reasonable judgment, would materially and adversely affect the validity of
the Mortgage Loans or the ability of the Mortgage Loan Seller to enter
into, or which would be likely to impair materially and adversely the
ability of the Mortgage Loan Seller to carry out the transactions
contemplated by, this Agreement;
(v) The Mortgage Loan Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default might have
consequences that, in the Mortgage Loan Seller's good faith and reasonable
judgment, would materially and adversely affect the condition (financial or
other) or operations
-3-
<PAGE>
of the Mortgage Loan Seller or its properties or might have consequences
that would materially and adversely affect its performance hereunder;
(vi) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Mortgage Loan Seller of or compliance by the Mortgage
Loan Seller with this Agreement or the consummation of the transactions
contemplated by this Agreement, other than those which have been obtained
by the Mortgage Loan Seller;
(vii) The transfer, assignment and conveyance of the Mortgage Loans by the
Mortgage Loan Seller to the Company is not subject to bulk transfer laws or
any similar statutory provisions in effect in any applicable jurisdiction;
and
(viii) Under generally accepted accounting principles ("GAAP") and for
federal income tax purposes, the Mortgage Loan Seller will report the
transfer of the Mortgage Loans to the Company as a sale of the Mortgage
Loans to the Company. The consideration received by the Mortgage Loan
Seller upon the sale of the Mortgage Loans to the Company will constitute
reasonably equivalent value and fair consideration for the Mortgage Loans.
The Mortgage Loan Seller will be solvent at all relevant times prior to,
and will not be rendered insolvent by, the sale of the Mortgage Loans to
the Company. The Mortgage Loan Seller is not selling the Mortgage Loans to
the Company with any intent to hinder, delay or defraud any of the
creditors of the Mortgage Loan Seller.
(b) The Mortgage Loan Seller hereby makes the representations and
warranties contained Schedule I, Schedule II and Schedule III with respect to
each Mortgage Loan as of the date specified therein or, if no such date is
specified, as of the Closing Date.
3. Notice of Breach; Cure and Repurchase.
(a) Pursuant to the Pooling and Servicing Agreement, the Mortgage Loan
Seller and the Company shall be given notice of any Breach or Document Defect
that materially and adversely affects the value of such Mortgage Loan or the
interests of the holders of the Certificates therein.
(b) Upon notice pursuant to Section 3(a) herein, the Mortgage Loan Seller
shall, not later than 90 days from the Mortgage Loan Seller's receipt of notice
of such Breach or
-4-
<PAGE>
Document Defect (or, in the case of a Document Defect or Breach relating to a
Mortgage Loan not being a "qualified mortgage" within the meaning of the Section
860G(a)(3) of the Internal Revenue Code of 1986, as amended (a "Qualified
Mortgage"), not later than 90 days of any party to this Agreement or to the
Pooling and Servicing Agreement discovering such Document Defect or Breach), if
such Breach or Document Defect shall materially and adversely affect the value
of such Mortgage Loan or the interests of the holders of the Certificates
therein, cure such Document Defect or Breach, as the case may be, in all
material respects or, if such Document Defect or Breach (other than omissions
solely due to a document not having been returned by the related recording
office) cannot be cured within the periods hereinafter set forth, repurchase the
affected Mortgage Loan at the applicable Repurchase Price (as defined below);
provided, however, that if such Document Defect or Breach is capable of being
cured but not within such 90-day period, such Document Defect or Breach does not
relate to any Mortgage Loan not being treated as a Qualified Mortgage, and the
Mortgage Loan Seller has commenced and is diligently proceeding with the cure of
such Document Defect or Breach within such 90-day period, the Mortgage Loan
Seller shall (A) with respect to any Breach, have an additional 90-day period to
complete such cure (or failing such cure, to complete such repurchase) and (B)
with respect to any Document Defect, have additional 90-day periods up to but
not exceeding the second anniversary of the Closing Date to complete such cure
(or failing such cure, to complete such repurchase); provided, further, that
with respect to each additional 90-day period, the 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 or additional 90-day period, as applicable, and what actions the
Mortgage Loan Seller is pursuing in connection with the cure thereof and stating
that the Mortgage Loan Seller anticipates that such Document Defect or Breach
will be cured within such additional 90-day period. If the affected Mortgage
Loan is to be repurchased, Mortgage Loan Seller shall remit the Repurchase Price
in immediately available funds to the Trustee. The delivery of a binding
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.
The "Repurchase Price" with respect to any Mortgage Loan or REO Loan to be
repurchased pursuant to this Agreement and Section 2.03 of the Pooling and
Servicing Agreement, shall have the meaning given to the term "Purchase Price"
in the Pooling and Servicing Agreement without giving effect to any amendment
thereto unless the Mortgage Loan Seller has given its consent to
-5-
<PAGE>
such amendment in writing and signed by a duly authorized officer of the
Mortgage Loan Seller.
(c) Upon any repurchase of a Mortgage Loan contemplated by Section 3(b)
above, the Trustee, the Servicer and the Special Servicer shall each tender to
the Mortgage Loan Seller, all portions of the Mortgage File and other documents
pertaining to such Mortgage Loan possessed by it, and each document that
constitutes a part of the Mortgage File that was endorsed or assigned to the
Trustee shall be endorsed or assigned, as the case may be, to the Mortgage Loan
Seller.
(d) This Section 3 of this Agreement provides the sole and exclusive remedy
available to the Company, the Trustee, the Certificateholders, or the Trustee on
behalf of the Certificateholders or any other party, respecting any Document
Defect or any Breach.
(e) Subject to the terms of this Agreement, the Mortgage Loan Seller hereby
acknowledges the assignment by the Company to the Trustee, as trustee under the
Pooling and Servicing Agreement, for the benefit of the Certificateholders, of
the representations and warranties contained herein and of the obligation of the
Mortgage Loan Seller to repurchase a Mortgage Loan pursuant to this Section. The
Trustee or its designee may enforce such obligations as provided in Section 8
hereof.
4. Representations, Warranties and Agreements of Company.
The Company hereby represents and warrants to the Mortgage Loan Seller, as
of the date hereof (or such other date as is specified in the related
representation or warranty), as follows:
(i) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, with full corporate
power and authority to own its assets and conduct its business, is duly
qualified as a foreign corporation in good standing in all jurisdictions in
which the ownership or lease of its property or the conduct of its business
requires such qualification, except where the failure to be so qualified
would not have a material adverse effect on the ability of the Company to
perform its obligations hereunder, and the Company has taken all necessary
action to authorize the execution, delivery and performance of this
Agreement by it, and has the power and authority to execute, deliver and
perform this Agreement and all the transactions contemplated hereby;
-6-
<PAGE>
(ii) This Agreement has been duly authorized, executed and delivered by the
Company and constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as
such enforcement may be limited by bankruptcy, reorganization, insolvency,
moratorium and other similar laws affecting the enforcement of creditors'
rights generally and to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law);
(iii) The execution and delivery of this Agreement by the Company and the
performance of its obligations hereunder will not conflict with any
provision of any law or regulation to which the Company is subject, or
conflict with, result in a breach of or constitute a default under any of
the terms, conditions or provisions of any of the Company's organizational
documents or any agreement or instrument to which the Company is a party or
by which it is bound, or any law, rule, regulation, judgment, writ,
injunction, order or decree applicable to the Company, or result in the
creation or imposition of any lien on any of the Company's assets or
property, in each case which would materially and adversely affect the
ability of the Company to carry out the transactions contemplated by this
Agreement;
(iv) There is no action, suit, proceeding or investigation pending or to
the knowledge of the Company, threatened against the Company in any court
or by or before any other governmental agency or instrumentality which
would materially and adversely affect the validity of this Agreement or any
action taken in connection with the obligations of the Company contemplated
herein, or which would be likely to impair materially the ability of the
Company to perform under the terms of this Agreement;
(v) The Company is not in default with respect to any order or decree of
any court or any order, regulation or demand of any federal, state,
municipal or governmental agency, which default might have consequences
that would materially and adversely affect the condition (financial or
other) or operations of the Company or its properties or might have
consequences that would materially and adversely affect its performance
hereunder;
-7-
<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 Company of or compliance by the Company with this
Agreement or the consummation of the transactions contemplated by this
Agreement other than those that have been obtained by the Company; and
(vii) Under GAAP and for federal income tax purposes, the Company will
report the transfer of the Mortgage Loans by the Mortgage Loan Seller to
the Company as a sale of the Mortgage Loans to the Company.
5. Company's Conditions to Closing.
The obligations of the Company under this Agreement shall be subject to the
satisfaction, on the Closing Date, or such other date specified herein, of the
following conditions:
(a) The obligations of the Mortgage Loan Seller required to be performed by
it at or prior to the Closing Date pursuant to the terms of this Agreement shall
have been duly performed and complied with and all of the representations and
warranties of the Mortgage Loan Seller under this Agreement shall be true and
correct in all material respects, and no event shall have occurred which, with
notice or the passage of time, or both, would constitute a material default
under this Agreement.
(b) The Company or its designee shall have received all of the following
closing documents, in such forms as are agreed upon and acceptable to the
Company and in form and substance satisfactory to the Company, the Underwriters
and their respective counsel, duly executed by all signatories other than the
Company as required pursuant to the respective terms thereof:
(i) with respect to each Mortgage Loan, the related Mortgage File, which
Mortgage Files shall be delivered to and held by the Trustee on behalf of
the Company;
(ii) the final Mortgage Loan Schedule;
(iii) an officer's certificate from the Mortgage Loan Seller dated as of
the Closing Date, in the form attached hereto as Exhibit B;
(iv) an opinion of Mortgage Loan Seller's counsel, subject to customary
exceptions and carve-outs, in form and substance reasonably acceptable to
the Company and its counsel and the Rating Agencies, which states in
substance the opinions set forth on Exhibit C hereto, and
-8-
<PAGE>
(v) such other documents, certificates and opinions as the Company may
reasonably request to effectuate the transactions contemplated by this
Agreement.
(c) The Mortgage Loan Seller hereby agrees to furnish such other
information, documents, certificates, letters or opinions with respect to the
Mortgage Loans or itself as may be reasonably requested by the Company in order
for the Company to perform any of its obligations or satisfy any of the
conditions on its part to be performed or satisfied pursuant to the Underwriting
Agreement, the Pooling and Servicing Agreement or this Agreement.
6. Indemnification and Contribution.
(a) The Mortgage Loan Seller shall indemnify and hold harmless the Company,
the Underwriter, their respective officers and directors, and each person, if
any, who controls the Company or the Underwriter within the meaning of either
Section 15 of the Securities Act of 1933, as amended (the "1933 Act") or Section
20 of the Securities Exchange Act of 1934, as amended (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) (i) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact relating to the Mortgage Loans, the related
Mortgagors, the related Mortgaged Properties or the Mortgage Loan Seller
contained in (A) the Prospectus Supplement and the Memorandum (insofar as the
following are incorporated as part of the Memorandum) under the headings
"Summary of the Prospectus Supplement-The Mortgage Pool" or "Summary of the
Prospectus Supplement-Mortgage Loan Sellers", "Risk Factors-The Mortgage Loans"
and "Description of the Mortgage Pool" and on Annex A to the Prospectus
Supplement, the Diskette or, insofar as they are required to be filed as part of
the Registration Statement pursuant to the No-Action Letters, any Computational
Materials or ABS Term Sheets with respect to the Registered Certificates, or in
any revision or amendment of or supplement to any of the foregoing, or (B) any
items similar to Computational Materials and ABS Term Sheets forwarded to
prospective investors in the Non-Registered Certificates, or (ii) arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
but, in the case of (i) and (ii), only if and to the extent that any such untrue
statement or alleged untrue statement or omission or alleged omission (I) arises
out of or is based upon an untrue statement or omission with respect to the
Mortgage Loans, the related Mortgagors or the related Mortgaged Properties
contained in the Master Tape (it
-9-
<PAGE>
being herein acknowledged that the Master Tape was used to prepare the
Prospectus Supplement including without limitation Annex A thereto, the
Memorandum, the Diskette, the Computational Materials and ABS Term Sheets with
respect to the Registered Certificates and any items similar to Computational
Materials and ABS Term Sheets forwarded to prospective investors in the
Non-Registered Certificates), (II) is contained in the information regarding the
Mortgage Loans, the related Mortgagor, the related Mortgaged Property or the
Mortgage Loan Seller set forth in the Prospectus Supplement and the Memorandum
(insofar as the following are incorporated as part of the Memorandum) under the
headings "Summary of the Prospectus Supplement-The Mortgage Pool" or "Summary of
the Prospectus Supplement-Mortgage Loan Sellers", "Risk Factors-The Mortgage
Loans" and "Description of the Mortgage Pool" or on Annex A to the Prospectus
Supplement; provided that the foregoing were provided to the Mortgage Loan
Seller for its review, or (III) arises out of or is based upon a breach of the
representations and warranties of the Mortgage Loan Seller set forth in or made
pursuant to Section 2 (such representations and warranties, together with the
information described in the preceding clauses I and II, the "Mortgage Loan
Seller Information"); provided that the indemnification provided by this Section
6 shall not apply to the extent that such untrue statement or omission was made
as a result of an error in (x) the manipulation of, or (y) any calculations
based upon, or (z) any aggregation (other than an aggregation made in the Master
Tape by the Mortgage Loan Seller) of, the information regarding the Mortgage
Loans, the related Mortgagor, the related Mortgaged Property or the Mortgage
Loan Seller set forth in the Master Tape and Annex A to the Prospectus
Supplement, including without limitation the aggregation of such information
with comparable information relating to the mortgage loans conveyed to the Trust
Fund by Merrill Lynch Mortgage Capital Inc. and Daiwa Finance Corp. (the "Other
Mortgage Loans"). This indemnity agreement will be in addition to any liability
which the Mortgage Loan Seller may otherwise have.
For purposes of this Agreement, "Registration Statement" shall mean the
registration statement No. 333-38073 filed by the Company on Form S-3, including
without limitation exhibits thereto and information incorporated therein by
reference; "Prospectus" shall mean the prospectus dated February 25, 1998, as
supplemented by the prospectus supplement dated March 24, 1998 (the "Prospectus
Supplement"), relating to the Registered Certificates, including all annexes
thereto; "Memorandum" shall mean the private placement memorandum dated March
27, 1998, relating to the Non-Registered Certificates; "Registered Certificates"
shall mean the Class A-1, Class A-2, Class B, Class C, Class D, Class E and
Class IO Certificates; "Non-Registered Certificates" shall mean the Certificates
other than the Registered Certificates; "Computational Materials" shall have the
meaning assigned thereto in the no-action letter dated May 20, 1994 issued by
the Division of Corporation Finance of the Securities and Exchange Commission
(the "Commission") to Kidder,
-10-
<PAGE>
Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated, and Kidder
Structured Asset Corporation and the no-action letter dated May 27, 1994 issued
by the Division of Corporation Finance of the Commission to the Public
Securities Association (together, the "Kidder Letters"); "ABS Term Sheets" shall
have the meaning assigned thereto in the no-action letter dated February 17,
1995 issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (the "PSA Letter" and, together with the Kidder
letters, the "No-Action Letters"); "Diskette" shall mean the diskette attached
to each of the Prospectus and the Memorandum; and "Master Tape" shall mean the
compilation of information and data regarding the Other Mortgage Loans and the
Mortgage Loans covered by the Independent Accountants' Report on Applying
Agreed-Upon Procedures dated March 24, 1998 and rendered by Deloitte & Touche
LLP (a "hard copy" of which Master Tape was initialed on behalf of the Mortgage
Loan Seller and the Company).
(b) Promptly after receipt by an indemnified party under this Section 6 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 6, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve the
indemnifying party from any liability which it may have to any indemnified party
under this Section 6, except to the extent that it has been prejudiced in any
material respect, or from any liability which it may have, otherwise than under
this Section 6. 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 reasonably satisfactory to such indemnified party;
provided 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 which are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying party
to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party for legal or other expenses
incurred by the indemnified party in connection with the defense thereof unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the
-11-
<PAGE>
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with one local counsel, if applicable), approved by
the Company, representing the indemnified parties under subsection (a) of this
Section 6 who are parties to such action), (ii) the indemnifying party shall not
have employed counsel reasonably 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 in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(c) If the indemnification provided for in this Section 6 shall for any
reason be unavailable in accordance with its terms to an indemnified party under
this Section 6, then the Mortgage Loan Seller and the Company shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or (b)
above, in such proportion as is appropriate to reflect the relative fault of the
Mortgage Loan Seller on the one hand and the Company on the other in connection
with the statement or omission that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Mortgage Loan Seller or the Company and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The Mortgage Loan Seller and the Company agree that it
would not be just and equitable if contribution pursuant to this subsection (d)
were to be determined by per capita allocation or by any other method of
allocation that does not take account of the equitable considerations referred
to herein. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
against any action or claim which is the subject of this subsection (d) subject
to the limitations therein provided under subsection (c). No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not also guilty of
such fraudulent misrepresentation.
7. Notices. All communications hereunder shall be in writing and effective
only upon receipt and, if sent to the Company, will be mailed, hand delivered,
couriered or sent by facsimile transmission to it at World Financial Center, New
York, New York 10281, attention: Bruce L. Ackerman fax number: (212)
-12-
<PAGE>
449-7684, or, if sent to the Mortgage Loan Seller, will be mailed, hand
delivered, couriered or sent by facsimile transmission to it at Financial
Square, 32 Old Slip, New York, New York 10005-3538, attention: Samuel Kirschner,
fax number: (212) 612-6976, with a copy to the attention of the General Counsel,
fax number: (212) 612-7155.
8. Trust as Beneficiary. The representations, warranties and agreements
made by the Mortgage Loan Seller in this Agreement are made for the benefit of,
and, to the extent they are assigned by the Company to the Trustee under the
Pooling and Servicing Agreement, may be enforced by or on behalf of, the
Trustee, the Servicer or the Special Servicer, as provided in the Pooling and
Servicing Agreement, to the same extent that the Company has rights against the
Mortgage Loan Seller under this Agreement in respect of representations,
warranties and agreements made by the Mortgage Loan Seller herein.
9. Miscellaneous. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES. This Agreement may be executed in any number of
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall together constitute but one and the same instrument. This
Agreement will inure to the benefit of and be binding upon the parties hereto
and their respective successors and assigns, and no other person will have any
right or obligation hereunder, other than as provided herein.
10. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement, or in
certificates of officers of the Mortgage Loan Seller and the Company submitted
pursuant hereto, shall remain operative and in full force and effect and shall
survive the transfer and sale of the Mortgage Loans to the Company and by the
Company to the Trustee notwithstanding any language to the contrary contained in
any endorsement of any Mortgage Loan; provided that the representations,
warranties and agreements shall terminate upon the termination of the Pooling
and Servicing Agreement.
11. Severability. If any provision of this Agreement shall be prohibited or
invalid under applicable law, this Agreement shall be ineffective only to such
extent, without invalidating the remainder of this Agreement.
12. Further Assurances. The Mortgage Loan Seller and the Company agree to
execute and deliver such instruments and take such actions as the other party
may, from time to time, reasonably request in order to effectuate the purpose
and to carry out the terms of this Agreement.
13. Amendments. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated except by
-13-
<PAGE>
a writing signed by a duly authorized officer of the party against whom
enforcement of such change, waiver, discharge or termination is sought to be
enforced. This Agreement may not be changed or waived in any manner which would
have a material adverse effect on Certificateholders without the prior written
consent of the Trustee.
14. Guaranty.
(a) Daiwa Finance Corp. ("DFC") (i) irrevocably, absolutely and
unconditionally guarantees the prompt payment, as and when due and payable, of
the Repurchase Price and (ii) agrees to pay any and all expenses (including
reasonable counsel fees and expenses) incurred by the Company, the Trustee, the
Servicer or the Special Servicer in enforcing its rights under this Section 14.
(b) DFC hereby guarantees that the Repurchase Price will be paid strictly
in accordance with the terms of this Agreement and the Pooling and Servicing
Agreement, regardless of any law, regulation or order now or hereafter in effect
in any jurisdiction affecting any of such terms or the rights of the Company,
the Trustee, the Servicer or the Special Servicer with respect thereto. DFC
agrees that its guarantee constitutes a guaranty of payment when due and not of
collection, and waives any right to require that any resort be made by the
Company, the Trustee, the Servicer or the Special Servicer to any security held
for payment of the Repurchase Price or for any other reason. The liability of
DFC hereunder shall be absolute and unconditional, irrespective of: (i) any
change in the time, manner or place of payment of, or in any other term in
respect of, all or any of the Repurchase Price (including, without limitation,
any extension for longer than the original period), or any other amendment or
waiver of or consent to any departure from any provision of this Agreement or
the Pooling and Servicing Agreement; and (ii) any release or amendment or waiver
of or consent to any departure from any other guaranty, for all or any of the
Repurchase Price.
(c) This Guaranty (i) is a continuing guaranty and shall remain in full
force and effect until the termination of the Pooling and Servicing Agreement,
(ii) shall continue to be effective or shall be reinstated, as the case may be,
if at any time any payment of any of the Repurchase Price is rescinded or must
otherwise be returned by the Company, the Trustee, the Servicer or the Special
Servicer upon the insolvency, bankruptcy or reorganization of the Mortgage Loan
Seller or otherwise, all as though such payment had not been made, and (iii)
shall be binding upon DFC and its successors and assigns.
(d) DFC hereby waives (i) promptness and diligence, (ii) notice of
acceptance and notice of the incurrence of any obligation to pay the Repurchase
Price, (iii) notice of any action taken by the Company, the Trustee, the
Servicer or the
-14-
<PAGE>
Special Servicer or the Mortgage Loan Seller under this Agreement or the Pooling
and Servicing Agreement or under any other agreement or instrument relating
thereto, (iv) all other notices, demands and protests, and all other formalities
of every kind in connection with the enforcement of the obligation to pay the
Repurchase Price or of the obligations of the Mortgage Loan Seller hereunder,
the omission of or delay in which, but for the provisions of this Section 14(d),
might constitute grounds for relieving the Mortgage Loan Seller of its
obligations hereunder, (v) any right to compel or direct the Company, the
Trustee, the Servicer or the Special Servicer to seek payment or recovery of any
amounts owed under this Section 14 from any one particular fund or source, and
(vi) any requirement that the Company, the Trustee, the Servicer or the Special
Servicer protect, secure, perfect or insure any security interest or lien or any
property subject thereto or exhaust any right or take any action against any
Person or any collateral. DFC agrees that the Company, the Trustee, the Servicer
or the Special Servicer shall have no obligation to marshall any assets in favor
of the Mortgage Loan Seller or against or in payment of any or all of the
Repurchase Price.
(e) DFC hereby irrevocably waives and agrees that it will not exercise any
and all rights which it has or may have at any time or from time to time
(whether arising directly or indirectly by operation of law or contract) to
assert any claim against the Mortgage Loan Seller on account of any payments
made under this Agreement, including, without limitation, any and all existing
and future rights of subrogation, reimbursement, exoneration, contribution
and/or indemnity. If any amount shall be paid to DFC on account of such rights
at any time when all of such obligations to pay the Repurchase Price shall not
have been paid in full, such amount shall be held in trust for the benefit of
the Company, the Trustee, the Servicer or the Special Servicer, shall be
segregated from the other funds of DFC and shall forthwith be paid over to the
Company, the Trustee, the Servicer or the Special Servicer to be applied in
whole or in part by the Company, the Trustee, the Servicer or the Special
Servicer against the Repurchase Price, in accordance with the terms of this
Agreement.
(f) No failure on the part of the Company, the Trustee, the Servicer or the
Special Servicer to exercise, and no delay in exercising, any right hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right hereunder preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and not
exclusive of any remedy provided by law.
[Signature page follows]
-15-
<PAGE>
IN WITNESS WHEREOF, the Company and the Mortgage Loan Seller have caused
this Agreement to be duly executed by their respective officers as of the day
and year first above written.
DAIWA REAL ESTATE FINANCE CORP.
By: /s/ HIROKI NOMURA
------------------------------------------
Name: Hiroki Nomura
Title: Authorized Signatory
MERRILL LYNCH MORTGAGE INVESTORS, INC.
By: /s/ BRUCE ACKERMAN
------------------------------------------
Name: Bruce Ackerman
Title: Authorized Signatory
Confirmed and Accepted,
DAIWA FINANCE CORP.
By: /s/ HIROKI NOMURA
---------------------------
Name: Hiroki Nomura
Title: Authorized Signatory
<PAGE>
EXHIBIT A
MORTGAGE LOAN SCHEDULE
A-1
<PAGE>
<TABLE>
<CAPTION>
Daiwa Real Estate
CONTROL
NUMBER PROPERTY NAME ADDRESS CITY STATE ZIP CODE
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
314 Lido Plaza Shopping Center 4343 North Rancho Drive Las Vegas NV 89130
324 The Wealshire 150 Jamestown Lane Lincolnshire IL 60069
325 Hampton Inn and Suites 6101 Sand Lake Road Orlando FL 32819
326 Hampton Inn 1975 N. Druid Hills Road Atlanta GA 30329
327 Days Inn Hotel 121 Days Inn Drive Easley SC 29640
329 Fortunoff 70 Charles Lindbergh Boulevard Uniondale NY 11553
339 South Plaza Shopping Center 5500 Nolansville Road Nashville TN 37211
479 Anna Hart Portfolio - 6 West 87th Street 6 West 87th Street New York NY 10024
480 Anna Hart Portfolio - 45 West 69th Street 45 West 69th Street New York NY 10023
481 Anna Hart Portfolio - 49 West 68th Street 49 West 68th Street New York NY 10023
482 Anna Hart Portfolio - 117 West 69th Street 117 West 69th Street New York NY 10023
483 Anna Hart Portfolio - 130 Beach 133rd Street 130 Beach 133rd Street Queens NY 11694
484 Anna Hart Portfolio - 148 West 76th Street 148 West 76th Street New York NY 10023
485 244 & 248 West 21st Street 244 & 248 West 21st Street New York NY 10011
488 Anna Hart Portfolio - 330 West 101st Street 330 West 101st Street New York NY 10025
514 Cedarhaus Apartments 4503-4509 So. Salina Street Syracuse NY 13205
519 Manayunk Apartments 3901 Manayunk Avenue Philadelphia PA 19128
544 Laurelwood Rehab and Skilled Nursing Center 642 Danbury Road Ridgefield CT 06877
<CAPTION>
REMAINING
CONTROL CUT-OFF DATE MONTHLY GROSS ----------------- MATURITY/ARD GROUND BALLOON/ARD/
NUMBER BALANCE PAYMENT RATE TERM AMORT DATE LEASE FULLY AMORTIZING
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
314 6,983,194.97 53,010.96 7.780 118 298 01/01/2008 No Balloon
324 15,933,738.61 125,084.67 8.150 116 296 11/01/2007 No Balloon
325 15,946,750.90 120,327.86 7.700 117 297 12/01/2007 No Balloon
326 6,727,535.52 50,763.32 7.700 117 297 12/01/2007 No Balloon
327 2,541,513.44 19,177.25 7.700 117 297 12/01/2007 No Balloon
329 5,902,464.31 73,655.39 8.270 105 118 12/01/2006 Yes Balloon
339 12,478,701.74 87,145.18 7.470 118 358 01/01/2008 No Balloon
479 463,174.78 3,608.94 8.625 117 357 12/01/2007 No Balloon
480 211,622.97 1,648.91 8.625 117 357 12/01/2007 No Balloon
481 224,599.82 1,750.03 8.625 117 357 12/01/2007 No Balloon
482 328,414.86 2,558.93 8.625 117 357 12/01/2007 No Balloon
483 179,679.88 1,400.02 8.625 117 357 12/01/2007 No Balloon
484 339,395.29 2,644.49 8.625 117 357 12/01/2007 No Balloon
485 728,701.66 5,677.87 8.625 117 357 12/01/2007 No Balloon
488 386,311.70 3,010.05 8.625 117 357 12/01/2007 No Balloon
514 369,180.21 2,948.24 8.375 118 298 01/01/2008 No Balloon
519 2,745,629.75 19,877.19 7.250 119 299 02/01/2008 No Balloon
544 13,000,000.00 96,916.04 7.600 180 300 03/01/2013 No Balloon
<CAPTION>
CONTROL SERVICING MORTGAGE INTEREST CROSS
NUMBER FEES (1) LOAN SELLER SUBSERVICER DEFEASANCE ACCRUAL DEFAULTED
- ------------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <C> <C> <C> <C>
314 0.160 Daiwa Real Estate Finance Corp. Collateral Mortgage Yes Actual/360
324 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
325 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
326 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
327 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
329 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
339 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
479 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
480 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
481 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
482 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
483 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
484 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
485 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
488 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
514 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
519 0.095 Daiwa Real Estate Finance Corp. First Union Actual/360
544 0.095 Daiwa Real Estate Finance Corp. First Union Yes Actual/360
</TABLE>
(1) Primary and master servicing fee.
<PAGE>
EXHIBIT B
FORM OF CERTIFICATE OF AN OFFICER OF
DAIWA REAL ESTATE FINANCE CORP.
I, ______________________, hereby certify that I am an authorized signatory
of Daiwa Real Estate Finance Corp., a Delaware corporation (the "Seller"), and
that, based upon information provided to me by appropriate officers, certify
further as follows, to the best of my knowledge:
The representations and warranties of the Seller in the Mortgage Loan
Purchase Agreement, dated as of March 1, 1998 (the "MLPA") 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.
The Seller has, in all material aspects, complied with all the agreements
and satisfied all the conditions on its part that are required under the MLPA to
be performed or satisfied at or prior to the date hereof.
IN WITNESS WHEREOF, I have executed this Certificate as of __________,
1998.
DAIWA REAL ESTATE FINANCE CORP.
By: __________________________________
Name:
Title:
I, ______________________, a ________________ of the Seller, hereby certify
that ______________________ is an authorized signatory of the Seller and that
the signature appearing above is his genuine signature.
IN WITNESS WHEREOF, I have executed this Certificate as of __________,
1998.
By: __________________________________
Name:
Title:
B-1
<PAGE>
EXHIBIT C
FORM OF LEGAL OPINION
1. The Mortgage Loan Seller is a Delaware corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
with full corporate power and authority to own its assets and conduct its
business as presently conducted by it, to own the Mortgage Loans, and enter into
and perform its obligations under the Mortgage Loan Purchase Agreement.
2. The Mortgage Loan Purchase Agreement has been duly authorized, executed
and delivered by the Mortgage Loan Seller and constitutes the legal, valid and
binding obligations of the Mortgage Loan Seller, enforceable against the
Mortgage Loan Seller in accordance with the terms of the Mortgage Loan Purchase
Agreement, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally, and by general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law),
and except to the extent rights to indemnity and contribution may be limited by
applicable law.
3. The execution and delivery of the Mortgage Loan Purchase Agreement by
the Mortgage Loan Seller and the performance of its obligations under the
Mortgage Loan Purchase Agreement will not conflict with any provision of any
federal or State of New York law or regulation to which the Mortgage Loan Seller
is subject, or conflict with, result in a breach of or constitute a default
under any of the terms, conditions or provisions of any of the Mortgage Loan
Seller's organizational documents, or, to our knowledge, any agreement or
instrument to which the Mortgage Loan Seller is a party or by which it is bound,
or any order of a federal or State of New York court, regulatory body,
administrative agency or government body having jurisdiction over the Mortgage
Loan Seller.
4. There is no action, suit, proceeding or investigation pending or
threatened, against the Mortgage Loan Seller in any court or by or before any
other governmental agency or instrumentality which would materially and
adversely affect the validity of the Mortgage Loans or the ability of the
Mortgage Loan Seller to carry out the transactions contemplated by this
Agreement.
5. No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Mortgage Loan Seller of or compliance by the Mortgage Loan
Seller with the Mortgage Loan Purchase Agreement or the consummation of the
transactions contemplated by the Mortgage Loan Purchase Agreement, other than
those which have been obtained by the Mortgage Loan Seller.
<PAGE>
Merrill Lynch Mortgage Investors, Inc. 1998-C2
SCHEDULE I
(i) Immediately prior to the sale, transfer and assignment of the Mortgage
Loans to the Company, the Mortgage Loan Seller had good and marketable title to,
and was the sole owner of, each Mortgage Loan;
(ii) The Mortgage Loan Seller is transferring such Mortgage Loan free and
clear of any and all liens, pledges, charges or security interests of any nature
encumbering such Mortgage Loan, and none of the Mortgage Note, the Mortgage or
any other related loan document prohibits such transfer;
(iii) Each related Mortgage Note, Mortgage, Assignment of Leases (if any)
and other agreement executed in connection with such Mortgage Loan is, a valid
and binding obligation of the related Mortgagor (subject to any non-recourse
provisions therein and any state anti-deficiency legislation), enforceable in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws affecting the
enforcement of creditors' rights generally, or by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law), and any lost note affidavit included in the Mortgage File in lieu of
a Mortgage Note does not impair the ability of the holder thereof to enforce the
terms of such Mortgage Note;
(iv) Each related Assignment of Leases, or, if none, the assignment of
leases and rents contained in the related Mortgage creates a valid, collateral
or first priority assignment of, or a valid first priority 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, 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;
(v) Each related assignment of Mortgage from the Mortgage Loan Seller to
the Trustee and any related assignment of Assignment of Leases, if any, and
assignment of any other agreement executed in connection with such Mortgage
Loan, from the Mortgage Loan Seller to the Trustee constitutes the legal, valid
and binding assignment from the Mortgage Loan Seller to the Trustee, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
liquidation, receivership, moratorium or other laws relating to or affecting
creditors' rights generally or by general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at law);
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<PAGE>
(vi) Since origination, such Mortgage Loan has not been modified, altered,
satisfied, canceled, subordinated or rescinded, except, in each of the foregoing
instances, by written instruments that are a part of the related Mortgage File,
and, if required, 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 Company, and no material portion of the
related Mortgaged Property has been released from the lien of the related
Mortgage, in each case, in any manner which materially and adversely affects the
value of the Mortgage Loan or materially interferes with the security intended
to be provided by such Mortgage, and, except with respect to those Mortgage
Loans listed on Exhibit I-VI attached hereto which permit defeasance and
substitution of real property collateral, the terms of the related Mortgage do
not provide for release of any portion of the Mortgaged Property from the lien
of the Mortgage in any manner which materially and adversely affects the
security provided by the Mortgaged Property;
(vii) Each related Mortgage is a valid first lien on the related Mortgaged
Property (subject to the matters described in clause (viii) below), and such
Mortgaged Property is free and clear of any mechanics' and materialmen's liens
which are prior to or equal with the lien of the related Mortgage, except those
which are insured against by a lender's title insurance policy (as described in
clause (viii) below);
(viii) The lien of each related Mortgage as a first priority lien in the
outstanding principal amount of such Mortgage Loan (as set forth on the Mortgage
Loan Schedule) after all advances of principal is insured by an ALTA lender's
title insurance policy (or a binding commitment therefor), or its equivalent as
adopted in the applicable jurisdiction, insuring the Mortgage Loan Seller, its
successors and assigns, subject only to (a) the lien of current real property
taxes, ground rents, water charges, sewer rents and assessments not yet due and
payable, (b) covenants, conditions and restrictions, rights of way, easements
and other matters of public record, none of which, individually or in the
aggregate, materially interferes with the current use of the Mortgaged Property
or the security intended to be provided by such Mortgage or with the Mortgagor's
ability to pay its obligations when they become due or materially and adversely
affects the value of the Mortgaged Property, and (c) the exclusions and
exceptions (general and specific) set forth in such policy, none of which,
individually or in the aggregate, materially interferes with the security
intended to be provided by such Mortgage or with the Mortgagor's ability to pay
its obligations when they become due or materially and adversely affects the
value of the Mortgaged Property; the original holder of the Mortgage, and/or its
successor or assigns, are the sole named insureds under such policy; such policy
is assignable to the Company and the Trustee without the consent of or any
notification to the insurer, and is now in full force and effect
-3-
<PAGE>
and will remain so upon the consummation of the transactions contemplated by
this Agreement; no claims have been made under such policy, the Mortgage Loan
Seller has not done anything, by act or omission, and the Mortgage Loan Seller
has no knowledge of any matter, which would impair or diminish the coverage of
such policy;
(ix) The proceeds of such Mortgage Loan have been fully disbursed and there
is no requirement for future advances thereunder and the Mortgage Loan Seller
covenants that it will not make any future advances under the Mortgage Loan to
the related Mortgagor;
(x) The Mortgage Loan Seller has received no notice of any proceeding
pending, nor to the Mortgage Loan Seller's knowledge, threatened, for the total
or partial condemnation of all or any material portion of such Mortgaged
Property, and, to the Mortgage Loan Seller's knowledge, each related Mortgaged
Property is free and clear of any material damage that would affect materially
and adversely the value of such Mortgaged Property as security for the Mortgage
Loan.
(xi) Except as indicated on Exhibit I-XI(A) attached hereto, the related
Mortgagor has represented to the Mortgagee that, as of the date of origination
of such Mortgage Loan, and, to the Mortgage Loan Seller's knowledge, either (a)
such Mortgagor and the lessee and/or operator of the related Mortgaged Property
was in possession of all material licenses, permits and other authorizations
necessary and required by all applicable laws for the conduct of its business
and all such licenses, permits and authorizations were valid and in full force
and effect, or (b) such Mortgagor uses, operates, occupies and maintains the
Mortgaged Property in accordance with all applicable laws and regulations;
(xii) The Mortgage Loan does not have a shared appreciation feature, other
contingent interest feature or (except with respect to those Mortgage Loans
listed on Exhibit I-XII attached hereto (the "ARD Loans")) provide for
hyper-amortization, a negative amortization feature;
(xiii) The Mortgage Loan is a whole loan and no other party holds a
participation interest in such Mortgage Loan;
(xiv) The Mortgage Rate (exclusive of any default interest, late charges,
prepayment premiums or defeasance deposits) of each Mortgage Loan complied as of
the date of origination with, or such Mortgage Loan is exempt from, applicable
state or federal laws, regulations and other requirements pertaining to usury;
any and all other requirements of any federal, state or local laws, including,
without limitation, truth-in-lending, real estate settlement procedures, equal
credit opportunity or disclosure laws, applicable to each
-4-
<PAGE>
Mortgage Loan have been complied with as of the date of origination of such
Mortgage Loan;
(xv) All taxes and governmental assessments which would be a lien on the
Property and that prior to the Cut-Off Date became due and owing in respect of
each related Mortgaged Property have been paid, or an escrow of funds in an
amount sufficient to cover such payments has been established;
(xvi) Except as indicated on Exhibit I-XVI attached hereto, all escrow
deposits and payments required pursuant to the Mortgage Loan are in the
possession, or under the control, of the Mortgage Loan Seller or its agent and
all amounts required to be deposited by the Borrower under the Loan Documents as
of the date hereof have been deposited and all such escrows and deposits have
been conveyed by the Mortgage Loan Seller to the Company and identified as such
with appropriate detail;
(xvii) Except as indicated on Exhibit I-XVII, as of the date of its
origination, each related Mortgaged Property is insured by a fire and extended
perils insurance policy in an amount not less than the lesser of (A) the
outstanding principal balance of the Mortgage Loan and (B) the replacement cost
of the related Mortgaged Property, and in all events the amount necessary to
avoid the operation of any co-insurance provisions with respect to the Mortgaged
Property; with respect to each related Mortgaged Property, the Mortgagor is
required to maintain, for Mortgage Loans greater than $1,000,000, business
interruption insurance (or loss of rents insurance) and comprehensive general
liability insurance in amounts generally required by institutional lenders for
similar properties; all premiums on such insurance policies required to be paid
as of the date hereof have been paid; such insurance policies require prior
notice to the insured and to the Mortgagee of termination or cancellation, and
except for as indicated on Exhibit I-XVII, no such notice has been received;
each related Mortgage or loan agreement obligates the related Mortgagor to
maintain a fire and extended perils insurance and, at such Mortgagor's failure
to do so, authorizes the Mortgagee to maintain such insurance at the Mortgagor's
cost and expense and to seek reimbursement therefor from such Mortgagor;
(xviii) Each Mortgage provides that any insurance proceeds in respect of a
casualty, other than business interruption/rental income insurance, and any
condemnation awards or insurance proceeds, will be applied either to the repair
or restoration of the Mortgaged Property or to the repayment of the outstanding
principal balance of the Mortgage Loan;
(xix) (A) To the Mortgage Loan Seller's knowledge, there is no material
default, breach, violation or event of acceleration existing under the related
Mortgage or the related Mortgage Note, and no event (other than payments due but
not yet delinquent) which, with the passage of time or with
-5-
<PAGE>
notice and the expiration of any grace or cure period, would constitute a
material default, breach, violation or event of acceleration, and (B) the
Mortgage Loan Seller has not waived in writing any material 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;
(xx) No Monthly Payment on such Mortgage Loan has been more than 30 days
delinquent from the later of one year prior to the Cut-off Date, the date of
origination of such Mortgage Loan or, if applicable, the date of acquisition by
the Mortgage Loan Seller of such Mortgage Loan, through the Cut-off Date;
(xxi) Each related Mortgage contains customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate for the
realization against the Mortgaged Property of the benefits of the security,
including realization by judicial or, if applicable, non-judicial foreclosure,
subject to the effects of bankruptcy or other law affecting the right of
creditors generally and the application of principles of equity, and there is no
exemption available to the Mortgagor which would interfere with such right to
foreclose;
(xxii) Except as indicated on Exhibit I-XXII attached hereto, one or more
environmental site assessments were performed by an environmental consulting
firm independent of the Mortgage Loan Seller and the Mortgage Loan Seller's
affiliates with respect to related Mortgaged Property during the 18 month period
preceding the closing of the Mortgage Loan and the Mortgage Loan Seller, having
made no independent inquiry other than to review the report(s) prepared in
connection with the assessments referred to herein, has no knowledge of any
material and adverse environmental condition or circumstance affecting such
Mortgaged Property that was not disclosed in such report(s);
xxiii) Each related Mortgage, Mortgage Note or loan agreement contains
provisions for the acceleration of the payment of the unpaid principal balance
of such Mortgage Loan if, without complying with the requirements of the
Mortgage or loan agreement, as applicable, the related Mortgaged Property, or
any controlling interest therein, is directly or indirectly transferred or sold
or is encumbered in connection with subordinate financing (other than any
existing subordinate debt);
(xxiv) Each Mortgage Loan constitutes a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Internal Revenue Code of 1986, as amended
(the "Code"). For this purpose, Section 860G(a)(3) of the Code shall be applied
without regard to the rule contained in Treasury Regulations Section
1.860G-2(f)(2) which treats a defective mortgage loan as
-6-
<PAGE>
a "qualified mortgage" under certain circumstances. Accordingly, the Mortgage
Loan Seller represents and warrants that each Mortgage Loan is directly secured
by a Mortgage on a commercial property or a multifamily residential property,
and either (1) substantially all of the proceeds of such Mortgage Loan were used
to acquire, improve or protect the portion of such commercial or multifamily
residential property that consists of an interest in real property and such
interest in real property was the only security for such Mortgage Loan as of the
Testing Date (as defined below), or (2) the fair market value of the interest in
real property which secures such Mortgage Loan was at least equal to 80% of the
principal amount of the Mortgage Loan (a) as of the Testing Date, or (b) as of
the Closing Date. For purposes of the previous sentence, (1) the fair market
value of the referenced interest in real property shall first be reduced by (a)
the amount of any lien on such interest in real property that is senior to the
Mortgage Loan, and (b) a proportionate amount of any lien on such interest in
real property that is on a parity with the Mortgage Loan, and (2) the "Testing
Date" shall be the date on which the referenced Mortgage Loan was originated
unless (a) such Mortgage Loan was modified after the date of its origination in
a manner that would cause a "significant modification" of such Mortgage Loan
within the meaning of Treasury Regulations Section 1.1001-3(b), and (b) such
"significant modification" did not occur at a time when such Mortgage Loan was
in default or when default with respect to such Mortgage Loan was reasonably
foreseeable. However, if the referenced Mortgage Loan has been subjected to a
"significant modification" after the date of its origination and at a time when
such Mortgage Loan was not in default or when default with respect to such
Mortgage Loan was not reasonably foreseeable, the Testing Date shall be the date
upon which the latest such "significant modification" occurred;
(xxv) As of the Cut-off Date the Mortgage Loan Schedule is true and correct
in all material respects;
(xxvi) Prepayment Premiums and Yield Maintenance Charges payable with
respect to the Mortgage Loan, if any, constitute "customary prepayment
penalties" within the meaning of Treasury Regulations Section 1.860G-1(b)(2);
(xxvii) The Mortgage File contains an appraisal of the related Mortgaged
Property, which appraisal is signed by a qualified appraiser who, to the
Mortgage Loan Seller's knowledge, had no interest, direct or indirect, in the
Mortgaged Property or in any loan made on the security thereof, and whose
compensation is not affected by the approval or disapproval of the Mortgage
Loan, and the appraisal and appraiser both satisfy the requirements of Title XI
of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and
the regulations promulgated thereunder, all as in effect on the date the
Mortgage Loan was originated;
-7-
<PAGE>
(xxviii) None of the material improvements which were included for the
purposes 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 such property (except Mortgaged Properties
which are legal non-conforming uses and/or except for immaterial encroachments
off of the Mortgaged Property or where the same is covered by a title insurance
endorsement or affirmative title insurance coverage), and no improvements on
adjoining properties materially encroach upon such Mortgaged Property, or the
requisite title insurance has been obtained with respect to the foregoing;
(xxix) The related Mortgagor has covenanted in the Mortgage Loan documents
to maintain the related Mortgaged Property in compliance with all applicable
laws, zoning (including legal non-conforming uses), ordinances rules, covenants
and restrictions affecting the construction, occupancy, use and operation of
such Mortgaged Property, and the related originator performed the type of due
diligence in connection with the origination of such Mortgage Loan customarily
performed by prudent institutional commercial and multifamily mortgage lenders
with respect to the foregoing matters; the Mortgage Loan Seller has received no
notice of any material violation of any applicable laws, zoning ordinances,
rules, covenants or restrictions affecting the construction, occupancy, use or
operation of such Mortgaged Property;
(xxx) Except as indicated on Exhibit I-XXX(A), With respect to the Mortgage
Loans which as of the Cut-off Date have a principal balance of at least $15
million, the related Mortgagor is an entity which has represented and covenanted
in connection with the origination of the Mortgage Loan, or whose organizational
documents provide, that so long as the Mortgage Loan is outstanding it will be a
single-purpose entity. For this purpose, "single-purpose entity" shall mean a
person, other than an individual, which does not engage in any business
unrelated to the related Mortgaged Property (which may include multiple
Mortgaged Properties owned by the same Borrower and securing only Mortgage Loans
conveyed hereunder as listed on Exhibit I-XXX(B)) and its (or their) financing,
does not have any material assets other than those related to its interest in
such Mortgaged Property (or Mortgaged Properties) or its (or their) financing,
or any indebtedness other than as permitted by the related Mortgage or the other
documents in the Mortgage Loan File, and such Mortgagor has covenanted under the
Mortgage that it will maintain its own books and records separate and apart from
any other person, and holds itself out as being a legal entity, separate and
apart from any other person;
(xxxi) The Mortgage Loan complied, in all material respects, with all of
the terms, conditions and requirements of the Mortgage Loan Seller's applicable
-8-
<PAGE>
underwriting standards in effect at the time of the origination or acquisition
of such Mortgage Loan;
(xxxii) The Mortgage Loan Seller has no knowledge nor has it received any
notice that any Mortgagor is a debtor in any state or federal bankruptcy or
insolvency proceeding;
(xxxiii) To the best of Mortgage Loan Seller's knowledge, as of the Closing
Date, there is no right of rescission, offset, abatement, diminution, defense or
counterclaim to the Mortgage Loan (including the defense of usury), nor will the
operation of any of the terms of the Mortgage Note or the Mortgage, or the
exercise of any rights thereunder, render the Mortgage Note or the Mortgage
unenforceable, in whole or in part (excluding provisions relating to default
interest, yield maintenance charges, prepayment premiums or defeasance
deposits), or subject to any right of rescission, offset, abatement, diminution,
valid defense or counterclaim (including the defense of usury or the violation
of any applicable disclosure or consumer credit laws), except in any such case
as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or other laws affecting the enforcement of creditors' rights
generally or by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law), and no such
right of rescission, offset, abatement, diminution, defense or counterclaim has
been asserted with respect thereto;
(xxxiv) In the case of any Mortgage which is a deed of trust, a trustee,
duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in the deed of trust or has been
substituted in accordance with applicable law, and no fees or expenses are, or
will become, payable to the trustee under the deed of trust, except in
connection with a trustee's sale after default by the Mortgagor or in connection
with the release of the Mortgaged Property or related security for the Mortgage
Loan following the payment of the Mortgage Loan in full;
(xxxv) The improvements located on the Mortgaged Property are either not
located in a federally designated special flood hazard area designated by the
Federal Emergency Management Agency as Zone A or Zone V or the Mortgagor is
required to maintain or the Mortgagee maintains, flood insurance with respect to
such improvements;
(xxxvi) If the Mortgaged Property is subject to any leases, the Mortgagor
is the owner and holder of the landlord's interest under any leases and the
related Mortgage or Assignment of Leases provides for the appointment of a
receiver for rents (in accordance with applicable law) or allows the Mortgagee
(in accordance with applicable law) to enter into possession to collect rent or
provides for rents to be paid directly to Mortgagee;
-9-
<PAGE>
(xxxvii) The Mortgage Note is not secured by any collateral that is not
being transferred hereunder;
(xxxviii) Each Mortgage Loan, if any, that is cross-collateralized is
cross-collateralized only with one or more other Mortgage Loans being
transferred hereunder;
(xxxix) The origination (or acquisition, as the case may be), servicing and
collection practices used with respect to the Mortgage Loan by the Mortgage Loan
Seller and, to the Mortgage Loan Seller's knowledge, by any prior holder of the
Mortgage Loan, have been in all respects legal, proper and prudent in all
material respects and have met customary industry standards;
(xl) No advance of funds has been made other than pursuant to the loan
documents, directly or indirectly, by the Mortgage Loan Seller to the Mortgagor
and, except as indicated on Exhibit I-XL attached hereto, to the Mortgage Loan
Seller's knowledge, no funds have been received from any person other than the
Mortgagor, for or on account of payments due on the Mortgage Note or the
Mortgage;
(xli) UCC Financing Statements have been filed and/or recorded in all
places necessary to perfect a valid security interest in all material furniture,
fixtures and equipment owned by a Mortgagor and located on each Mortgaged
Property and for which perfection is accomplished by the filing of a UCC
financing statement, and the mortgages, security agreements, chattel mortgages
or equivalent documents related to and delivered in connection with the related
Mortgage Loans establish and create a valid and enforceable first lien and first
priority security interest on such material furniture, fixtures and equipment
except as enforceability may be limited by bankruptcy or other laws affecting
creditor's rights generally or by the application of the rules of equity;
(xlii) Except as indicated on Exhibit I-XLII attached hereto as being
subject to subordinate debt secured by a subordinate mortgage encumbering the
related Mortgaged Property (the "Subordinate Debt Mortgage Loans"), as of the
date of the Prospectus, to the Mortgage Loan Seller's knowledge, the Mortgagor
has no indebtedness for borrowed money secured by a mortgage encumbering the
Mortgaged Property other than the Mortgage Loan. Except as indicated in Exhibit
I-XLII, with respect to the Subordinate Debt Mortgage Loans, the creditor (the
"Subordinate Lender") under such secured indebtedness for borrowed money ("Other
Debt") of the Mortgagor has entered into a subordination agreement with the
Mortgage Loan Seller (or the Mortgage Loan originator) pursuant to which (A) the
Subordinate Lender has agreed to fully subordinate the Other Debt to the
Mortgage Loan (collectively, the "Senior Debt"), (B) the Subordinate Lender has
agreed not to declare a default or
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<PAGE>
exercise any remedies with respect to the Other Debt until the Senior Debt has
been paid in full, and (C) such subordination agreement is assignable to the
Company and its successors and assigns and is being assigned hereunder and is
part of the Mortgage File;
(xliii) 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 I-XLIII and, 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 the amount set forth in Exhibit I-XLIII attached hereto;
(xliv) The Mortgage Loan has an interest rate of at least 6.91% per annum;
(xlv) The Mortgage Loan is non-recourse to the related Mortgagor (or its
principals) except for certain circumstances including fraud, misappropriation,
material misrepresentation and other matters expressly set forth in the related
Mortgage Loan documents;
(xlvi) The Mortgage Loan Seller (or Mortgage Loan originator) has inspected
or caused to be inspected each related Mortgage Property within twelve months of
origination;
(xlvii) Except as set forth in Schedule II, the Mortgage Loan is not
secured in whole or in part by a ground lease; and
(xlviii) 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 Mortgaged Property that, if determined
adversely to such Mortgagor, would materially and adversely affect the ability
of the Mortgagor to pay principal, interest or any other amount due under such
Mortgage Loan.
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<PAGE>
SCHEDULE II
For each Mortgage Loan identified on the Mortgage Loan Schedule as a ground
lease, the Mortgage Loan Seller hereby represents and warrants:
(A)(i) the Mortgage Loan is also secured by the related fee interest or
(ii) the ground lease represents a non-essential portion of the Mortgaged
Property, and the ground lease has an original term (or an original term plus
one or more optional renewal terms, which, under all circumstances, may be
exercised, and will be enforceable, by the Mortgagor, or the Mortgagee if the
Mortgagee acquires the related Mortgaged Property upon foreclosure,
assignment-in-lieu of foreclosure or otherwise) that extends not less than 10
years beyond the stated maturity of the related Mortgage Loan, or
(B) if the Mortgage Loan is secured by a Mortgage constituting a valid
first lien on an unencumbered interest of the Borrower as lessee under a ground
lease underlying the related Mortgaged Property, then the Mortgage Loan Seller
represents and warrants the following:
(i) The ground lease (which shall mean such ground lease, all amendments
and modifications thereof and any related estoppels or agreements from ground
lessor) or a memorandum regarding it has been duly recorded. The ground lease
permits the interest of the lessee to be encumbered by the related Mortgage and
does not restrict the use of the related Mortgaged Property by such lessee, its
successors or assigns in a manner that would adversely affect the security
provided by the related Mortgage. There has been no material change in the terms
of such ground lease since its recordation, except by written instruments, all
of which are included in the related Mortgage File;
(ii) The lessor under such ground lease has agreed in a writing included in
the related Mortgage File that the 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, except if an event of default occurs under the Ground
Lease and notice is provided to the Mortgagee and such default is curable by the
Mortgagee, but remains uncured beyond the applicable cure period;
(iii) The ground lease has an original term (or an original term plus one
or more optional renewal terms, which, under all circumstances, may be
exercised, and will be enforceable, by the Mortgagee) that extends not less than
10 years beyond the stated maturity of the related Mortgage Loan;
(iv) The ground lease is not subject to any liens or encumbrances superior
to, or of equal priority with, the
<PAGE>
Mortgage (including without limitation, the rights of any fee-mortgage, if any)
other than the related ground lessor's related fee interest and any exceptions
set forth in the related title insurance policy or opinion of title;
(v) The ground lease is assignable to the Mortgagee and its assigns without
the consent of the lessor thereunder (or, if any such consent is required, it
has been obtained prior to the Closing Date);
(vi) As of the date of origination of the Mortgage Loan, and to the
Mortgage Loan Seller's knowledge as of the Cut-off Date, the ground lease is in
full force and effect and no default has occurred, nor is there any existing
condition which, but for the passage of time or giving of notice, would result
in a default under the terms of the ground lease;
(vii) The ground lease or ancillary agreement between the lessor and the
lessee requires the lessor to give notice of any default by the lessee to the
Mortgagee. The ground lease or ancillary agreement further provides that either
no notice given is effective or no termination of the lease in connection
therewith will be effective against the Mortgagee unless written notice of such
default or a copy thereof has been given to the Mortgagee in a manner described
in the ground lease or ancillary agreement;
(viii) The Mortgagee is permitted a reasonable opportunity, which may be
concurrent and coterminous with the Mortgagor's rights thereunder (including,
where necessary, sufficient time to gain possession of the interest of the
lessee under the ground lease through legal proceedings, or to take other action
so long as the Mortgagee is proceeding) to cure any default under the ground
lease which is curable after the receipt of notice of any default before the
lessor may terminate the ground lease;
(ix) The ground lease does not impose any restrictions on subletting by the
Mortgagee that would be viewed as commercially unreasonable by a prudent
commercial mortgage lender;
(x) The ground lease provides that any related insurance proceeds or
condemnation award (other than in respect of a total or substantially total loss
or taking) will be applied either to the repair or restoration of all or part of
the related Mortgaged Property, with the Mortgagee or a trustee appointed by it
having the right to hold and disburse such proceeds as repair or restoration
progresses, or, in the case of condemnation, assigned to the mortgagee, or in
the case of casualty to Tenants, to the payment of the outstanding principal
balance of the Mortgage Loan, together with any accrued interest (except in
cases where a different allocation would not be viewed as commercially
unreasonable by any institutional investor, taking
-2-
<PAGE>
into account the relative duration of the ground lease and the related Mortgage
and the ratio of the market value of the related Mortgaged Property to the
outstanding principal balance of such Mortgage Loan);
(xi) Until the principal balance and accrued interest are paid in full,
neither the lessee nor the lessor under the ground lease will have the option to
terminate or modify the ground lease without prior written consent of the
Mortgagee as a result of any casualty or partial condemnation, except to provide
for an abatement of the rent;
(xii) 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 upon the rejection of the lease
in bankruptcy; and
(xiii) Except as set forth on Exhibit II-XIII attached hereto, the ground
lease does not provide for an increase in rental payments.
-3-
<PAGE>
SCHEDULE III
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:
(i) Except as indicated on Exhibit III-I, attached hereto, 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 number of beds, and approved
provider status in any approved provider payment program (collectively, the
"Licenses");
(ii) 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.
(iii) As of the Cut-off Date and to Mortgage Loan 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-1
<PAGE>
EXHIBIT I-XI (A)
None.
<PAGE>
EXHIBIT I-XII
None.
<PAGE>
EXHIBIT I-XVI
None.
<PAGE>
EXHIBIT I-XVII
None.
<PAGE>
EXHIBIT I-XXII
None.
<PAGE>
EXHIBIT I-XXXX
None.
<PAGE>
EXHIBIT I-XL
None.
<PAGE>
EXHIBIT I-XLII
None.
<PAGE>
EXHIBIT III - (i)
Control Number 544 Laurelwood. The State of Connecticut has licensed 120 beds
which is the current amount of beds available. Borrower has agreed to increase
the license to 126 beds or deposit cash collateral with the Lender.
<PAGE>
<TABLE>
<CAPTION>
DREFC AFFL
EXHIBIT I-XLIII
BORROWERS OR GROUPS OF AFFILIATED BORROWERS WITH MULTIPLE MORTGAGE LOANS
CONTROL LOAN MORTGAGE CUT-OFF
NUMBER NUMBER LOAN SELLER PROPERTY NAME LOAN AMOUNT
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
325 1027 Daiwa Real Estate Finance Corp. Hampton Inn and Suites 15,946,751
326 1028 Daiwa Real Estate Finance Corp. Hampton Inn 6,727,536
327 1029 Daiwa Real Estate Finance Corp. Days Inn Hotel 2,541,513
----------
Total 25,215,800
479 217691 Daiwa Real Estate Finance Corp. Anna Hart Portfolio - 6 West 87th Street 463,175
480 217692 Daiwa Real Estate Finance Corp. Anna Hart Portfolio - 45 West 69th Street 211,623
481 217693 Daiwa Real Estate Finance Corp. Anna Hart Portfolio - 49 West 68th Street 224,600
482 217694 Daiwa Real Estate Finance Corp. Anna Hart Portfolio - 117 West 69th Street 328,415
483 217695 Daiwa Real Estate Finance Corp. Anna Hart Portfolio - 130 Beach 133rd Street 179,680
484 217696 Daiwa Real Estate Finance Corp. Anna Hart Portfolio - 148 West 76th Street 339,395
485 217697 Daiwa Real Estate Finance Corp. 244-248 West 21 Street 728,702
488 217698 Daiwa Real Estate Finance Corp. Anna Hart Portfolio - 330 West 101st Street 386,312
----------
Total 2,861,901
<CAPTION>
CONTROL
NUMBER LIST CNTRL# OF AFFILIATED LOANS AFFILIATES
- ------------------------------------------------------------------
<S> <C>
325 Cntrl #'s 326, 327 Laxmi
326 Cntrl #'s 325, 327 Laxmi
327 Cntrl #'s 326, 327 Laxmi
Total
479 Cntrl #'s 480, 481, 482, 483, 484, 485, 488 Anna Hart
480 Cntrl #'s 479, 481, 482, 483, 484, 485, 488 Anna Hart
481 Cntrl #'s 479, 480, 482, 483, 484, 485, 488 Anna Hart
482 Cntrl #'s 479, 480, 481, 483, 484, 485, 488 Anna Hart
483 Cntrl #'s 479, 480, 481, 482, 484, 485, 488 Anna Hart
484 Cntrl #'s 479, 480, 481, 482, 483, 485, 488 Anna Hart
485 Cntrl #'s 479, 480, 481, 482, 483, 484, 488 Anna Hart
488 Cntrl #'s 479, 480, 481, 482, 483, 484, 485 Anna Hart
Total
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
DREFC Def Loans
EXHIBIT I-VI
DEFEASANCE LOANS
CONTROL LOAN MORTGAGE CUT-OFF
NUMBER NUMBER LOAN SELLER PROPERTY NAME LOAN AMOUNT
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
314 1016 Daiwa Real Estate Finance Corp. Lido Plaza Shopping Center 6,983,195
324 1026 Daiwa Real Estate Finance Corp. The Wealshire 15,933,739
329 1031 Daiwa Real Estate Finance Corp. Fortunoff 5,902,464
339 1040 Daiwa Real Estate Finance Corp. South Plaza Shopping Center 12,478,702
544 9927 Daiwa Real Estate Finance Corp. Laurelwood Rehab and Skilled Nursing Center 13,000,000
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
fortunoff
EXHIBIT II-XIII
SCHEDULE OF GROUND LEASE PAYMENT INCREASES
MONTHLY
CONTROL # PROPERTY NAME MORTGAGE LOAN SELLER GROUND RENT BEGINNING ENDING
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
329 Fortunoff Daiwa Real Estate Finance Corp. 6,464.79 7/28/97 7/27/02
7,388.33 7/28/02 7/27/07
8,311.88 7/28/07 thru lease term
</TABLE>
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