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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): December 22, 1995
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE
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(State or other jurisdiction of incorporation)
33-91148 13-3526694
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(Commission File Number) (IRS Employer Identification No.)
ONE SEAPORT PLAZA, 26TH FLOOR, NEW YORK, NEW YORK 10292
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 778-1000
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Not applicable
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(Former name or former address, if changed since last report)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On December 22, 1995, a single series of certificates, entitled
Prudential Securities Secured Financing Corporation, Commercial Mortgage
Pass-Through Certificates, Series-1995-MCF-2 (the "Certificates") was issued
pursuant to a Pooling and Servicing Agreement, dated as of December 1, 1995 (the
"Pooling and Servicing Agreement"), by and among Prudential Securities Secured
Financing Corporation, as depositor (the "Depositor"), Midland Loan Services,
L.P., as servicer, Lennar Partners, Inc., as special servicer, LaSalle National
Bank, as trustee, and ABN AMRO Bank N.V., as fiscal agent. The Certificates
consist of 14 classes, respectively designated as the "Class A-1 Certificates,"
the "Class C Certificates," the "Class D Certificates" and the "Class E
Certificates" (collectively, the "Publicly Offered Certificates"), and the
"Class A-2 Certificates," the "Class A-EC Certificates," the "Class B
Certificates," the "Class F Certificates," the "Class G Certificates," the
"Class H Certificates," the "Class J-1 Certificates," the "Class J-2
Certificates," the "Class R Certificates" and the "Class LR Certificates"
(collectively, the "Privately Placed Certificates"; and together with the
Publicly Offered Certificates, the "Certificates"). The Certificates were issued
in exchange for, and evidence the entire beneficial ownership interest in, the
assets of a trust fund consisting primarily of a pool of 84 "whole" mortgage
loans (the "Whole Loans") and a 49.3% participation interest in a single "whole"
mortgage loan (the "Mortgage Participation"; together with the Whole Loans, the
"Mortgage Loans"), having, as of the close of business on the Cut-off Date (as
defined in the Pooling and Servicing Agreement), an aggregate principal balance
of approximately $222,286,173.
The Publicly Offered Certificates were offered pursuant to a
prospectus supplement, dated December 22, 1995, and the Privately Placed
Certificates were offered pursuant to a private placement memorandum, dated
December 22, 1995. The Publicly Offered Certificates were sold by the
Depositor to Prudential Securities Incorporated pursuant to an underwriting
agreement, dated December 22, 1995 (the "Underwriting Agreement"). The
Underwriting Agreement is attached hereto as Exhibit 1.1.
The Class A-1 Certificates have an initial stated principal balance (a
"Certificate Balance") of $75,000,000. The Class C Certificates have an
initial Certificate Balance of $13,337,000. The Class D Certificates have an
initial Certificate Balance of $8,892,000. The Class E Certificates have an
initial Certificate Balance of $15,560,000. The Private Certificates (other
than the Class A-EC Certificates and the Class J-2 Certificates, which are
interest-only Certificates entitled to receive distributions of interest
accrued on a notional balance calculated as provided in the Pooling and
Servicing Agreement) have an aggregate Certificate Balance of approximately
$109,497,173.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Not applicable
(b) Not applicable
(c) Exhibits
Exhibit No. Description
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1.1 Underwriting Agreement dated as of December 22, 1995, by and
among Prudential Securities Secured Financing Corporation
and Prudential Securities Incorporated.
4.1 Pooling and Servicing Agreement dated as of December 1, 1995
by and among Prudential Securities Secured Financing
Corporation, as depositor, Midland Loan Services, L.P., as
servicer, Lennar Partners, Inc., as special servicer,
LaSalle National Bank, as trustee, and ABN AMRO Bank N.V., as
fiscal agent.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
PRUDENTIAL SECURITIES SECURED
FINANCING CORPORATION
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(Registrant)
DATE: January 5, 1996 BY: /s/ Peter Riemenschneider
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Peter Riemenschneider
Vice President
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EXHIBIT INDEX
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Exhibit No. Description
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1.1 Underwriting Agreement dated as of December 22, 1995, by and
among Prudential Securities Secured Financing Corporation
and Prudential Securities Incorporated.
4.1 Pooling and Servicing Agreement dated as of December 1, 1995
by and among Prudential Securities Secured Financing
Corporation, as depositor, Midland Loan Services, L.P., as
servicer, Lennar Partners, Inc., as special servicer,
LaSalle National Bank, as trustee, and ABN AMRO Bank N.V., as
fiscal agent.
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Exhibit 1.1
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1995-MCF-2, CLASS A-1, CLASS C, CLASS D AND CLASS E
UNDERWRITING AGREEMENT
New York, New York
December 22, 1995
Prudential Securities Incorporated
One New York Plaza - 15th Floor
New York, New York 10292-2015
Ladies and Gentlemen:
Prudential Securities Secured Financing Corporation, a
Delaware corporation (the "Company"), proposes to issue and sell, pursuant to
the terms of this Underwriting Agreement (this "Underwriting Agreement") to
Prudential Securities Incorporated, as underwriter (the "Underwriter"), the
Prudential Securities Secured Financing Corporation Commercial Mortgage
Pass-Through Certificates, Series 1995-MCF-2, Class A-1, Class C, Class D and
Class E (collectively, the "Offered Securities") having the respective initial
aggregate approximate Certificate Balances set forth on Schedule I hereto, each
Certificate evidencing an undivided beneficial ownership interest in a separate
trust fund (the "Trust Fund"), the property of which is primarily comprised of
a pool (the "Mortgage Pool") of 84 fixed-rate mortgage loans, with original
terms to maturity of not more than twenty years (the "Whole Loans"), secured by
first liens on commercial and multifamily residential properties (the
"Mortgaged Properties") and one mortgage loan participation (the "Seaport
Participation" and collectively with the Whole Loans, the "Mortgage Loans")
that constitutes a 49.3% undivided ownership interest in one fixed-rate
mortgage loan. The Mortgaged Properties consist of multifamily residential
housing, nursing homes, congregate care facilities, retail properties, office
buildings, self-storage facilities, light industrial/industrial properties,
hotels, mobile home parks and mixed use properties.
The sale of the Offered Securities is to occur simultaneously
with the separate offering of Prudential Securities Secured Financing
Corporation Commercial Mortgage Pass-Through Certificates, Series 1995-MCF-2,
Class A-2, Class A-EC, Class F, Class G, Class H, Class J-1, Class J-2, Class R
and Class LR (the "Privately Placed Certificates"), which are being issued
pursuant to the Private Placement Memorandum, dated December 22, 1995 (the
"Memorandum") and sold to Prudential Securities Incorporated, as placement
agent (in such capacity, the "Placement Agent") pursuant to a Certificate
Purchase Agreement, dated December 22, 1995 (the "Certificate Purchase
Agreement").
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The Trust Fund will be established pursuant to an agreement
(the "Pooling and Servicing Agreement") to be dated as of December 1, 1995, by
and among the Company, as depositor, Midland Loan Services, L.P., as servicer
(the "Servicer"), Lennar Partners, Inc., as special servicer (the "Special
Servicer"), LaSalle National Bank, as trustee (the "Trustee"), and ABN AMRO
Bank N.V., as fiscal agent (the "Fiscal Agent").
The Mortgage Loans will be purchased by the Company from
Midland Commercial Financing Corp. (the "Mortgage Loan Seller"), a Missouri
corporation, pursuant to a Mortgage Loan Purchase and Sale Agreement to be
dated as of December 22, 1995 (the "Mortgage Loan Purchase and Sale
Agreement"), among the Mortgage Loan Seller, the Servicer and the Company and
will be transferred to the Trustee, for the benefit of the Certificateholders,
in exchange for the Offered Securities and the Privately Placed Certificates.
The Seaport Participation will be created pursuant to a Participation
Agreement, to be dated as of December 1, 1995, between LaSalle National Bank,
as seller and the Mortgage Loan Seller, as participant (the "Participation
Agreement").
Capitalized terms used but not otherwise defined herein shall
have the respective meanings assigned to them in the Pooling and Servicing
Agreement.
1. Offering by the Underwriter. Upon the execution of
this Underwriting Agreement and the authorization by the Underwriter of the
release of the Offered Securities, the Underwriter proposes to offer for sale
to the public the Offered Securities at the price and upon the terms set forth
in the Final Prospectus (as hereinafter defined).
2. Conditions of the Underwriter's Obligations. The
obligation of the Underwriter hereunder to purchase the Offered Securities
shall be subject to the accuracy of the representations and warranties on the
part of the Company contained herein as of the date hereof and as of the
Closing Date, to the accuracy of the statements of the Company, the Servicer
and the Special Servicer made in any certificate pursuant to the provisions
hereof, to the performance by the Company in all material respects of its
obligations hereunder and to the following additional conditions:
(a) All actions required to be taken and all
filings required to be made by or on behalf of the Company under the
Securities Act of 1933, as amended (the "1933 Act"), and the
Securities Exchange Act of 1934, as amended (the "1934 Act"), prior to
the sale of the Offered Securities shall have been duly taken or made.
(b) The Underwriter shall have received on the
Closing Date an Officers' Certificate of the Company, dated the
Closing Date, to the effect that: (i) No stop order suspending the
effectiveness of the Company's registration statement (Registration
No. 33-58522) (the "Registration Statement") shall be in effect; (ii)
no proceedings for such purpose shall be pending before or threatened
by the Securities and Exchange Commission (the "Commission"), or by
any authority administering any state securities or "Blue Sky" laws;
(iii) any requests for additional information on the part of the
Commission shall have been complied with to the Underwriter's
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reasonable satisfaction, (iv) since the respective dates as of which
information is given in the Registration Statement, the Prospectus,
dated December 22, 1995 (the "Prospectus") and the Prospectus
Supplement, dated December 22, 1995 (the "Prospectus Supplement";
together with the Prospectus, the "Final Prospectus") and the except
as otherwise stated therein, there shall have been no material adverse
change in the condition, financial or otherwise, earnings, affairs,
regulatory situation or business prospects of the Company; (v) there
are no material actions, suits or proceedings pending (or threatened)
before any court or governmental agency, authority or body, affecting
the Company or the transactions contemplated by this Underwriting
Agreement; and (vi) the Company is not in violation of its Certificate
of Incorporation, as amended, or its by-laws or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, pooling and servicing agreement,
indenture, mortgage, loan agreement, note, lease or other instrument
to which it is a party or by which it or its properties may be bound,
which violations or defaults separately or in the aggregate would have
a material adverse effect on the Company.
(c) Subsequent to the execution of this
Underwriting Agreement, there shall not have occurred any of the
following: (i) if at or prior to the Closing Date, trading in
securities on the New York Stock Exchange shall have been suspended or
any material limitation in trading in securities generally shall have
been established on such exchange, or a banking moratorium shall have
been declared by New York or United States authorities, or (ii) if at
or prior to the Closing Date, there shall have been an outbreak of
hostilities between the United States and any foreign power, or of any
other insurrection or armed conflict involving the United States which
results in the declaration of a national emergency or war, and, in the
reasonable opinion of the Underwriter, makes it impracticable or
inadvisable to offer or sell the Offered Securities.
(d) The Underwriter shall have received written
notification from each of Standard & Poor's Rating Service ("S&P"),
Fitch Investors Service, L.P. ("Fitch") and Duff & Phelps Credit
Rating Co. ("Duff") to the effect that the Offered Securities have
been rated no lower than the required ratings set forth in Schedule I
hereto, and as of the Closing Date, such rating or ratings shall not
have been rescinded and there shall not have been any downgrading, or
public notification of a possible downgrading, or public notification
of a possible change without indication of direction.
(e) The Offered Securities, the Mortgage Loan
Purchase and Sale Agreement, the Pooling and Servicing Agreement and
this Underwriting Agreement shall have been duly authorized, executed
and delivered by the respective parties thereto and shall be in full
force and effect.
(f) The Company shall have delivered to the
Underwriter an Officers' Certificate of the Company, dated the Closing
Date, to the effect that the
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signer of such certificate has carefully examined the Prospectus
Supplement and this Agreement and that: (i) the representations and
warranties of the Company in this Agreement are true and correct in
all material respects at and as of the Closing Date with the same
effect as if made on the Closing Date, (ii) the Company has complied
with all the agreements and satisfied all the conditions on its part
to be performed or satisfied at or prior to the Closing Date, and
(iii) nothing has come to the attention of the signer that would lead
the signer to believe that the Prospectus Supplement contains any
untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except that no such representation or
warranty shall be required as to statements contained in or omitted
from the Prospectus Supplement in reliance upon and in conformity with
information furnished in writing to the Company by the Underwriter
specifically for use in the Prospectus Supplement and any amendment or
supplement thereto.
(g) The Servicer shall have delivered to the
Underwriter an Officers' Certificate of the general partner of the
Servicer, dated the Closing Date, to the effect that (i) the signer of
such certificate has carefully examined the Prospectus Supplement and
that nothing has come to the attention of the signer that would lead
the signer to believe that the statements in the Prospectus Supplement
relating to the Servicer contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading and (ii)
all of the Servicer's representations and warranties contained in the
Pooling and Servicing Agreement are true and correct as if made on the
Closing Date.
(h) The Special Servicer shall have delivered to
the Underwriter an Officers' Certificate of the Special Servicer,
dated the Closing Date, to the effect that the signer of such
certificate has carefully examined the Prospectus Supplement and that
nothing has come to the attention of the signer that would lead the
signer to believe that the statements in the Prospectus Supplement
relating to the Special Servicer contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
except that no such representation or warranty shall be required as to
statements contained in or omitted from the Prospectus Supplement in
reliance upon and in conformity with information furnished in writing
to the Company by the Underwriter specifically for use in the
Prospectus Supplement and any amendment or supplement thereto.
(i) The Underwriter shall have received from each
of (i) Fred A. Robustelli, Esq., Associate General Counsel of the
Company, and (ii) O'Melveny & Myers, special counsel to the Company, a
favorable opinion, dated the Closing Date, and satisfactory in form
and substance to counsel for the Underwriter. With respect to such
opinions, each counsel (a) may express its reliance as to factual
matters on the representations and warranties made by, and on
certificates or other documents
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furnished by officers of, the parties to this Underwriting Agreement,
the Pooling and Servicing Agreement and the Mortgage Loan Purchase and
Sale Agreement, (b) may assume the due authorization, execution and
delivery of the instruments and documents referred to therein by the
parties thereto other than the Company (except that O'Melveny & Myers
may rely upon the opinion of Fred A. Robustelli, Associate General
Counsel of the Company, as to due authorization and execution), (c)
may tender such opinion only as to the federal laws of the United
States of America, the laws of the State of New York and the General
Corporation Law of the State of Delaware and (d) may, to the extent
necessary, rely as to the laws of states other than New York on the
opinion of local counsel.
(j) The Underwriter shall have received from
O'Melveny & Myers, special counsel to the Underwriter, such opinion,
dated the Closing Date, with respect to the issuance and sale of the
Offered Securities, the Pooling and Servicing Agreement, the Mortgage
Loan Purchase and Sale Agreement, this Underwriting Agreement, the
Final Prospectus and other related matters as the Underwriter may
reasonably require, and the Company shall have furnished to such
counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(k) The Underwriter shall have received from
Deloitte & Touche LLP, the Company's certified public accountants, a
letter dated the date hereof and satisfactory in form and substance to
the Underwriter and counsel for the Underwriter, to the effect that
such accountants have performed certain specified procedures as a
result of which they confirmed certain information of an accounting,
financial or statistical nature set forth in the Final Prospectus.
(l) The Underwriter shall have received from
Deloitte & Touche LLP, the Servicer's certified public accountants, a
letter dated the date hereof and satisfactory in form and substance to
the Underwriter and counsel for the Underwriter, to the effect that
such accountants have performed certain specified procedures as a
result of which they confirmed certain information of an accounting,
financial or statistical nature set forth in the Final Prospectus.
(m) The Underwriter shall have received from
Morrison & Hecker L.L.P., counsel to the Servicer, a favorable
opinion, dated the Closing Date, in form and substance satisfactory to
the Underwriter and counsel for the Underwriter, to the effect that
each of the Pooling and Servicing Agreement and the Participation
Agreement has been duly authorized, executed and delivered by the
Servicer and constitutes the legal, valid, binding and enforceable
agreement of the Servicer, subject, as to enforceability, to
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights in general and by general principles
of equity regardless of whether enforcement is considered in a
proceeding in equity or at law, and as to such other matters as may be
agreed upon by the Underwriter and the Servicer. With respect to such
opinion, such counsel (a) may express is reliance as to
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factual matters on the representations and warranties made by, and on
certificates or other documents furnished by officers of the parties
to the Pooling and Servicing Agreement, (b) may assume the due
authorization, execution and delivery of the instruments and documents
referred to therein by the parties thereto other than the Servicer and
(c) may render such opinion only as to the laws of the State of New
York, the State of Missouri and the federal laws of the United States
of America.
(n) The Underwriter shall have received from
Rubin Baum Levin Constant Friedman & Bilzin, counsel to the Special
Servicer, a favorable opinion, dated the Closing Date, in form and
substance satisfactory to the Underwriter and counsel for the
Underwriter, to the effect that the Pooling and Servicing Agreement
has been duly authorized, executed and delivered by the Special
Servicer and constitutes the legal, valid, binding and enforceable
agreement of the Special Servicer, subject, as to enforceability, to
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights in general and by general principles
of equity regardless of whether enforcement is considered in a
proceeding in equity or at law, and as to such other matters as may be
agreed upon by the Underwriter and the Special Servicer. With respect
to such opinion, such counsel (a) may express is reliance as to
factual matters on the representations and warranties made by, and on
certificates or other documents furnished by officers of the parties
to the Pooling and Servicing Agreement, (b) may assume the due
authorization, execution and delivery of the instruments and documents
referred to therein by the parties thereto other than the Special
Servicer, (c) may render such opinion only as to the laws of the State
of New York, the State of Florida and the federal laws of the United
States of America.
(o) The Underwriter shall have received from
Morrison & Hecker L.L.P., counsel to the Servicer and the Mortgage
Loan Seller, a favorable opinion, dated the Closing Date, in form and
substance satisfactory to the Underwriter and counsel for the
Underwriter, to the effect that the Mortgage Loan Purchase and Sale
Agreement has been duly authorized, executed and delivered by the
Servicer and the Mortgage Loan Seller and constitutes the legal,
valid, binding and enforceable agreement of the Servicer and the
Mortgage Loan Seller, subject, as to enforceability, to bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights in general and by general principles of equity
regardless of whether enforcement is considered in a proceeding in
equity or at law, and as to such other matters as may be agreed upon
by the Underwriter, the Servicer and the Mortgage Loan seller. With
respect to such opinion, such counsel (a) may express is reliance as
to factual matters on the representations and warranties made by, and
on certificates or other documents furnished by officers of the
parties to the Pooling and Servicing Agreement and the Mortgage Loan
Purchase and Sale Agreement, (b) may assume the due authorization,
execution and delivery of the instruments and documents referred to
therein by the parties thereto other than the Servicer and the
Mortgage Loan Seller (c) may render such opinion only as to the laws
of the State of Missouri and the federal laws of the United States of
America.
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(p) The Underwriter shall have received from each
of (i) Thomas A. Rosiello, Esq., Senior Counsel of the Trustee and
(ii) Mayer, Brown & Platt, counsel to the Trustee, a favorable
opinion, dated the Closing Date, in form and substance satisfactory to
the Underwriter and counsel for the Underwriter, to the effect that
the Pooling and Servicing Agreement has been duly authorized, executed
and delivered by the Trustee and constitutes the legal, valid, binding
and enforceable agreement of the Trustee, subject, as to
enforceability, to bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors' rights in general and by
general principles of equity regardless of whether enforcement is
considered in a proceeding in equity or at law, and as to such other
matters as may be agreed upon by the Underwriter and the Trustee
(except that Mayer, Brown & Platt may rely on the opinion of Thomas A.
Rosiello, Esq., Senior Counsel of the Trustee, as to due authorization
and execution).
(q) The Underwriter shall have received from each
of (i) Thomas A. Rosiello, Esq., Senior Counsel of the Fiscal Agent
and (ii) Mayer, Brown & Platt, counsel to the Fiscal Agent, a
favorable opinion dated the Closing Date, in form and substance
satisfactory to the Underwriter and counsel for the Underwriter, to
the effect that the Pooling and Servicing Agreement has been duly
authorized, executed and delivered by the Fiscal Agent and constitutes
the legal, valid, binding and enforceable agreement of the Fiscal
Agent, subject, as to enforceability, to bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights in general and by general principles of equity, regardless of
whether enforcement is considered in a proceeding in equity or at law,
and as to such other matters as may be agreed upon by the Underwriter
and the Fiscal Agent (except that Mayer, Brown & Platt may rely on the
opinion of Thomas A. Rosiello, Esq., Senior Counsel of the Fiscal
Agent, as to due authorization and execution).
(r) All proceedings in connection with the
transactions contemplated by this Agreement and all documents incident
hereto shall be satisfactory in form and substance to the Underwriter
and counsel for the Underwriter, and the Underwriter and such counsel
shall have received such information, certificates and documents as
the Underwriter or such counsel may have reasonably requested.
(s) The Underwriter shall have received a copy of
the Letter of Representations of the Company to The Depository Trust
Company with respect to the Offered Securities.
(t) All conditions to the obligation of the
Placement Agent pursuant to Section 4 of the Certificate Purchase
Agreement shall have been satisfied.
(u) The Company shall have furnished such further
information, certificates, documents and opinions as the Underwriter
may reasonably request.
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If any of the conditions specified in this Section 2 shall not
have been fulfilled in all material respects when and as provided in this
Underwriting Agreement, if the Company is in breach of any covenants or
agreements contained herein or if any of the opinions and certificates referred
to above or elsewhere in this Underwriting Agreement shall not be in all
material respects reasonably satisfactory in form and substance to the
Underwriter and counsel for the Underwriter, this Underwriting Agreement and
all obligations of the Underwriter hereunder may be canceled at, or at any time
prior to, the Closing Date by the Underwriter. Notice of such cancellation
shall be given to the Company in writing, or by telephone, telecopy or
telegraph confirmed in writing.
3. Covenants of the Company. In further consideration
of the agreements of the Underwriter contained in this Underwriting Agreement,
the Company covenants as follows:
(a) The Company shall furnish the Underwriter,
without charge, copies of the Registration Statement and any
amendments thereto including exhibits and as many copies of the Final
Prospectus and any supplements and amendments thereto as the
Underwriter may from time to time reasonably request.
(b) The Company will not file any amendment to
the Registration Statement or any supplement to the Prospectus of
which the Underwriter shall not previously have been advised and
furnished with a copy a reasonable time prior to the proposed filing
or to which the Underwriter shall have reasonably objected. The
Company will use its best efforts to cause any post-effective
amendment to the Registration Statement to become effective as
promptly as possible. During the time when a prospectus is required
to be delivered under the 1933 Act, the Company will comply so far as
it is able with all requirements imposed upon it by the 1933 Act and
the rules and regulations thereunder to the extent necessary to permit
the continuance of sales or of dealings in the Offered Securities in
accordance with the provisions hereof and of the Final Prospectus, and
the Company will prepare and file with the Commission, promptly upon
request by the Underwriter, any amendments to the Registration
Statement or amendments or supplements to the Prospectus which may be
necessary or advisable in connection with the distribution of the
Offered Securities by the Underwriter, and will use its best efforts
to cause the same to become effective as promptly as possible. The
Company will advise the Underwriter, promptly after it receives notice
thereof, of the time when any amendment to the Registration Statement
or any amended Registration Statement has become effective or any
amendment or supplement to the Final Prospectus or any amended
Prospectus has been filed. The Company will advise the Underwriter,
promptly after it receives notice or obtains knowledge thereof, of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or any order preventing or
suspending the use of any preliminary prospectus supplement or the
Final Prospectus, or the suspension of the qualification of the
Offered Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceeding for any such purpose, or
of any request made by the Commission for the
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amending or supplementing of the Registration Statement or the Final
Prospectus or for additional information, and the Company will use its
best efforts to prevent the issuance of any such stop order or any
order suspending any such qualification, and if any such order is
issued, to obtain the lifting thereof as promptly as possible.
(c) If, at any time when a prospectus relating to
the Offered Securities is required to be delivered under the 1933 Act,
any event occurs as a result of which the Final Prospectus would
include any untrue statement of a material fact, or omit to state any
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, or if it is necessary for any other reason
to amend or supplement the Final Prospectus to comply with the 1933
Act, to promptly notify the Underwriter thereof and upon the
Underwriter's request to prepare and file with the Commission, at the
Company's own expense, an amendment or supplement which will correct
such statement or omission or any amendment which will effect such
compliance.
(d) During the period when a prospectus is
required by law to be delivered in connection with the sale of the
Offered Securities pursuant to this Underwriting Agreement, the
Company will file, on a timely and complete basis, all documents that
are required to be filed by the Company with the Commission pursuant
to Sections 13, 14 or 15(d) of the 1934 Act.
(e) The Company shall qualify the Offered
Securities for offer and sale under the securities or "Blue Sky" laws
of such jurisdictions as the Underwriter shall reasonably request and
to pay all expenses (including fees and disbursements of counsel) in
connection with such qualification of the eligibility of the Offered
Securities for investment under the laws of such jurisdictions as the
Underwriter may designate provided that in connection therewith the
Company shall not be required to qualify to do business or to file a
general consent to service of process in any jurisdiction.
(f) For so long as any of the Offered Securities
remain outstanding, to furnish to the Underwriter upon request in
writing copies of such financial statements and other periodic and
special reports as the Company may from time to time distribute
generally to its creditors or the holders of the Offered Securities
and to furnish to the Underwriter copies of each annual or other
report the Company shall be required to file with the Commission.
(g) To the extent, if any, that the rating
provided with respect to the Offered Securities by the rating agency
or agencies that initially rate the Offered Securities is conditional
upon the furnishing of documents or the taking of any other actions by
the Company, the Company shall use its best efforts to furnish such
documents and take any such other actions.
9
<PAGE> 10
(h) The Company will enter into the Mortgage Loan
Purchase and Sale Agreement and the Pooling and Servicing Agreement on
or prior to the Closing Date.
4. Representations and Warranties of the Company. The
Company represents and warrants to the Underwriter that:
(a) The Registration Statement on Form S-3 (No.
33-58522) including the Prospectus, has become effective. No stop
order suspending the effectiveness of such Registration Statement has
been issued and no proceeding for that purpose has been initiated or
threatened by the Commission. The Prospectus Supplement will be filed
with the Commission pursuant to Rule 424 under the 1933 Act. The
conditions to the use of a registration statement on Form S-3 under
the 1933 Act, as set forth in the General Instructions on Form S-3,
and the conditions or Rule 415 under the 1933 Act, have been
satisfied with respect to the Company and the Registration Statement.
There are no contracts or documents of the Company that are required
to be filed as exhibits to the Registration Statement pursuant to the
1933 Act or the rules and regulations thereunder that have not been so
filed.
(b) On the effective date of the Registration
Statement, the Registration Statement and the Prospectus conformed in
all material respects to the requirements of the 1933 Act and the
rules and regulations thereunder, and did not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; on the date of this Underwriting Agreement and
as of the Closing Date, the Registration Statement and the Final
Prospectus conform, and as amended or supplemented, if applicable,
will conform in all material respects to the requirements of the 1933
Act and the rules and regulations thereunder, and on the date of this
Underwriting Agreement and as of the Closing Date, neither of such
documents includes any untrue statement of a material fact of omits to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and neither of such
documents as amended or supplemented, if applicable, will include any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that the foregoing does not
apply to statements or omissions in any of such documents based upon
written information furnished to the Company by the Underwriter
specifically for use therein.
(c) Since the respective dates as of which
information is given in the Registration Statement and the Final
Prospectus, except as otherwise stated therein, there has been no
material adverse change in the condition, financial or otherwise,
earnings, affairs, regulatory situation or business prospects of the
Company, whether or not arising in the ordinary course of business of
the Company.
10
<PAGE> 11
(d) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Delaware, has full power and authority (corporate and
other) and all requisite approvals, orders, licenses, certificates and
permits of and from all governmental or regulatory officials and
bodies necessary to own its properties and to conduct its business as
described in the Final Prospectus and to enter into and perform its
obligations under this Agreement, the Pooling and Servicing Agreement
and the Mortgage Loan Purchase and Sale Agreement; and, except as
otherwise set forth or contemplated in the Final Prospectus, there are
no legal or governmental proceedings pending or, to the best knowledge
of the Company, threatened that would result in a material
modification, suspension or revocation thereof.
(e) The Company has all requisite power and
authority (corporate and other) and all requisite authorizations,
approvals, order, licenses, certificates and permits of and from all
governmental or regulatory officials and bodies to own its properties,
to conduct its business as described in the Registration Statement and
the Final Prospectus and to execute, deliver and perform this
Underwriting Agreement, the Pooling and Servicing Agreement and the
Mortgage Loan Purchase and Sale Agreement, except such as may be
required under state securities or Blue Sky laws in connection with
the purchase and distribution by the Underwriter of the Offered
Securities; all such authorizations, approvals, orders, licenses,
certificates are in full force and effect and contain no unduly
burdensome provisions; and, except as set forth or contemplated in the
Registration Statement or the Final Prospectus, there are no legal or
governmental proceedings pending or, to the best knowledge of the
Company, threatened that would result in a material modification,
suspension or revocation thereof.
(f) The Offered Securities have been duly
authorized, and when they are issued and delivered pursuant to this
Underwriting Agreement, they will have been duly executed, issued and
delivered and will be entitled to the benefits provided by the Pooling
and Servicing Agreement, subject, as to enforcement, to applicable
bankruptcy, reorganization, insolvency, moratorium and other laws
affecting the rights of creditors generally, and to general principles
of equity (regardless of whether considered in a proceeding in equity
or at law), and will conform in substance to the description thereof
contained in the Registration Statement and the Final Prospectus, and
will in all material respects be in the form contemplated by the
Pooling and Servicing Agreement.
(g) This Agreement has been duly authorized,
executed and delivered by the Company. Each of the Pooling and
Servicing Agreement and the Mortgage Loan Purchase and Sale Agreement,
when executed and delivered as contemplated hereby, will have been
duly authorized, executed and delivered by the Company. This
Underwriting Agreement constitutes, and each of the Pooling and
Servicing Agreement and the Mortgage Loan Purchase and Sale Agreement
when so executed and delivered will constitute, a legal, valid,
binding and enforceable
11
<PAGE> 12
agreement of the Company, subject, as to enforceability, to
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally and to general principles
of equity regardless of whether enforcement is sought in a proceeding
in equity or at law.
(h) As of the Closing Date, the Offered
Securities, the Pooling and Servicing Agreement, the Mortgage Loan
Purchase and Sale Agreement and each of the Mortgage Loans will each
conform in all material respects to the respective descriptions
thereof contained in the Prospectus Supplement, and on the Closing
Date, the Company (pursuant to the Pooling and Servicing Agreement)
will assign to the Trustee for the benefit of the Certificateholders
of the Offered Securities, certain representations and warranties with
respect to the Mortgage Loans made by the Mortgage Loan Seller to the
Company in the Mortgage Loan Purchase and Sale Agreement, and the
representations and warranties will be true and correct in all
material respects.
(i) No filing or registration with, or notice to,
or consent, approval, non-disapproval, authorization or order or other
action of, any court or governmental authority or agency is required
for the consummation by the Company of the transactions contemplated
by this Underwriting Agreement or the Pooling and Servicing Agreement,
except such as have been obtained and except such as may be required
under the 1933 Act, the rules and regulations thereunder, or state
securities or "Blue Sky" laws, in connection with the purchase and
distribution of the Offered Securities by the Underwriter.
(j) The Company owns or possesses or has obtained
all material governmental licenses, permits, consents, orders,
approvals and other authorizations necessary to lease, own or license,
as the case may be, and to operate, its properties and to carry on its
business as presently conducted and has received no notice of
proceedings relating to the revocation of any such license, permit,
consent, order or approval, which singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would
materially adversely affect the conduct of the business, results of
operations, net worth or condition (financial or otherwise) of the
Company.
(k) Other than as set forth or contemplated in
the Final Prospectus, there are no legal or governmental proceedings
pending to which the Company is a party or of which any property of
the Company is the subject which, if determined adversely to the
Company would individually or in the aggregate have a material adverse
effect on the condition (financial or otherwise), earnings, affairs,
business or business prospects of the Company and, to the best of the
Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(l) As of the Closing Date, each of the Mortgage
Loans will meet the criteria for selection described in the Final
Prospectus, and at the Closing Date,
12
<PAGE> 13
the representations and warranties made by the Company in the Pooling
and Servicing Agreement will be true and correct as of the date made.
(m) At the time of execution and delivery of the
Pooling and Servicing Agreement, the Company will have good and
marketable title to the Mortgage Loans, free and clear of any lien,
mortgage, pledge, charge, encumbrance, adverse claim or other security
interest (collectively "Liens"), and will not have assigned to any
person any of its right, title or interest in the Mortgage Loans or in
the Pooling and Servicing Agreement or the Offered Securities, the
Company will have the power and authority to transfer the Offered
Securities to the Underwriter, and, upon execution and delivery to the
Trustee of the Pooling and Servicing Agreement and delivery to the
Underwriter of the Offered Securities, and delivery to the Underwriter
of the Privately Placed Certificates, the Trustee will have good and
marketable title to the Mortgage Loans and the Underwriter will have
good and marketable title to the Offered Securities, in each case free
and clear of any Liens.
(n) Neither the Company nor the Trust Fund is,
and neither (i) the issuance and sale of the Offered Securities in the
manner contemplated by the Final Prospectus or the issuance and sale
of the Publicly Offered Certificates in the manner contemplated by the
Final Prospectus, nor (ii) the activities of the Trust Fund pursuant
to the Pooling and Servicing Agreement will cause the Company or the
Trust Fund to be an "investment company" or under the control of an
"investment company," as such terms are defined in the Investment
Company Act of 1940, as amended.
(o) The Pooling and Servicing Agreement is not
required to be qualified under the Trust Indenture Act of 1939, as
amended, and the Trust Fund is not required to be registered under the
Investment Company Act of 1940, as amended.
(p) Any taxes, fees and other governmental
charges in connection with the execution, delivery and issuance of
this Underwriting Agreement, this Underwriting Agreement, the Pooling
and Servicing Agreement and the Offered Securities have been or will
be paid at or prior to the Closing.
5. Indemnification and Contribution. (a) The Company
agrees to indemnify and hold harmless the Underwriter and each person, if any,
who controls the Underwriter within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 1934 Act against any and all losses, claims, damages
or liabilities, joint or several to which they may become liable under the 1933
Act, the 1934 Act, or other federal or state law or regulation, at common law
or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Final
Prospectus or in any amendment or supplement thereto, or 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
13
<PAGE> 14
therein not misleading, and agrees to reimburse such indemnified party for any
legal or other expenses reasonably incurred by it in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that (i) the Company will not be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of or is
based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company as herein stated by the Underwriter
specifically for use in connection with the preparation thereof, and (ii) such
indemnity with respect to the preliminary Final Prospectus shall not inure to
the benefit of the Underwriter (or any person controlling the Underwriter) with
respect to any person asserting any such loss, claim, damage or liability who
purchased the Offered Securities that are the subject thereof if such person
did not receive a copy of the Final Prospectus to the confirmation of the sale
of such Offered Securities to such person in any case where such delivery is
required by the 1933 Act and the untrue statement or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact
contained in the preliminary Final Prospectus (or other written material
prepared in lieu thereof) was corrected in the Final Prospectus. This
indemnity will be in addition to any liability that the Company may otherwise
have.
(b) The Underwriter will 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, to the same extent as
the foregoing indemnity from the Company to the Underwriter, but only with
reference to written information furnished to the Company as herein stated by
or on behalf of the Underwriter specifically for use in connection with the
preparation of the documents referred to in the foregoing indemnity. This
indemnity will be in addition to any liability that the Underwriter may
otherwise have.
(c) Promptly after receipt by an indemnified party under
this Section 5 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 5, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve it from any liability that it may have to
any indemnified party otherwise than under this Section 5. 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 (i) to participate therein, and (ii) to the extent that it may elect
by written notice delivered to the indemnified party promptly after receiving
the aforesaid notice from such indemnified party, to assume the defense
thereof, with counsel satisfactory to such indemnified party; provided,
however, that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party or parties shall
have reasonably concluded that there may be legal defenses available to it or
them and/or other indemnified parties that are different from or additional to
those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assert such legal defenses
and 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 upon approval by the indemnified party of counsel, the
indemnifying party will
14
<PAGE> 15
not be liable for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof, and the indemnifying
party will be liable for the legal and other expenses subsequently incurred by
such indemnified party or parties 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 clause of this sentence (it being understood, however,
that the indemnifying party shall not be liable for the expenses of more than
one separate counsel, approved by the Underwriter in the case of paragraph (a)
of this Section 5, representing the indemnified parties under such paragraph
(a) who are parties to such action), (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action, or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party; and
except that, if clause (i) or (iii) is applicable, such liability shall only be
in respect of the counsel referred to in such clause (i) or (iii).
(d) If the indemnification provided for in this Section 5
shall for any reason be unavailable to an indemnified party under this Section
5, then the Company and the Underwriter shall contribute to the amount paid or
payable by such indemnified party as a result of the aggregate losses, claims,
damages and liabilities referred to in paragraph (a) or (b) above, in such
proportion as is appropriate to reflect (i) the relative benefits received by
the Company on the one hand and the Underwriter on the other from the placement
of the Offered Securities, and (ii) the relative fault of the Company on the
one hand and the Underwriter on the other in connection with the statement or
omission that resulted in such losses, claims, damages and liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company and the Underwriter shall be deemed to be in the same proportion
as the purchase price paid by the Underwriter pursuant to Section 2 hereof
bears to the difference between (i) the total price at which the Offered
Securities were sold by the Underwriter and (ii) the purchase price paid by the
Underwriter pursuant to Section 2 hereof. 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 Company or the
Underwriter and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The
Company and the Underwriter agree that it would not be just and equitable if
contributions pursuant to this paragraph (d) were to be determined by pro rata
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 paragraph (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 paragraph (d). Notwithstanding the provisions of
this paragraph (d), the Underwriter shall not be required to contribute any
amount in excess of the amount by which the total price at which the Offered
Securities placed by it exceeds the amount of any damages that the Underwriter
has otherwise been required to pay or has become liable to pay by reason of
such untrue or
15
<PAGE> 16
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 5 each person,
if any, who controls the Underwriter within the meaning of either the 1933 Act
or the 1934 Act shall have the same rights to contribution as the Underwriter,
and each person, if any, who controls the Company within the meaning of either
the 1933 Act or the 1934 Act, each director and each officer of the Company
shall have the same rights to contribution as the Company. Any party entitled
to contribution will promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this paragraph
(d), notify such party or parties from whom contribution may be sought, but the
omission to so notify such party or parties shall not relieve the party or
parties from whom contribution may be sought from any other obligation it or
they may have hereunder or otherwise than under this paragraph (d).
6. Survival of Certain Representations and Obligations.
The respective representations, warranties, agreements, covenants, indemnities
and other statements of the Company, its officers and the Underwriter set forth
in, or made pursuant to, this Underwriting Agreement shall remain in full force
and effect, regardless of any investigation, or statement as to the result
thereof, made by or on behalf of any Underwriter, the Company, or any of the
offices or directors or any controlling person of any of the foregoing, and
shall survive the delivery of and payment for the offered Securities.
7. Termination. (a) This Underwriting Agreement may be
terminated by the Company by notice to the Underwriter in the event that a stop
order suspending the effectiveness of the Registration Statement shall have
been issued or proceedings for that purpose shall have been instituted or
threatened.
(b) This Underwriting Agreement may be terminated by the
Underwriter by notice to the Company in the event that the Company or the
Servicer shall have failed, refused or been unable to perform all obligations
and satisfy all conditions to be performed or satisfied hereunder by the
Company at or prior to the Closing Date.
(c) Termination of this Underwriting Agreement pursuant
to this Section 7 shall be without liability of any party to any other party
other than as provided in Sections 8 and 12 hereof.
8. Default of Underwriter. If the Underwriter defaults
in its obligation to purchase the Offered Securities as provided in this
Underwriting Agreement and the aggregate principal amount of the Offered
Securities with respect to which such default occurs is more than ten percent
of the aggregate principal amount, notional amount or Stated Amount, as
applicable, of such Offered Securities, as the case may be, and arrangements
satisfactory to the Underwriter and the Company for the purchase of such
Offered Securities by other persons are not made within 36 hours after any such
default, this Underwriting Agreement will terminate without liability on the
part of the Company except for the
16
<PAGE> 17
expenses to be paid or reimbursed by the Company pursuant to Section 11 hereof
and except for the provisions of Sections 14 hereof. As used in this
Underwriting Agreement, the term "Underwriter" includes any person substituted
for an Underwriter under this Section 10.
9. Expenses. The Company agrees with the Underwriter
that: (a) whether or not the transactions contemplated in this Underwriting
Agreement are consummated or this Underwriting Agreement is terminated, the
Company will pay all fees and expenses incident to the performance of its
obligations under this Underwriting Agreement, including but not limited to,
(i) the Commission's registration fee, (ii) the expenses of printing and
distributing this Underwriting Agreement and any related underwriting
documents, the Registration Statement, any preliminary prospectus, the
Prospectus Supplement, any amendments or supplements to the Registration
Statement or the Prospectus Supplement, and any Blue Sky memorandum or legal
investment survey and any supplements thereto, (iii) fees and expenses of
rating agencies, accountants and counsel for the Company, (iv) the expenses
referred to in Section 5(e) hereof, and (v) all miscellaneous expenses referred
to in Item 30 of the Registration Statement; (b) all out-of-pocket expenses,
including counsel fees, disbursements and expenses, reasonably incurred by the
Underwriter in connection with investigating, preparing to market and marketing
the Offered Securities and proposing to purchase and purchasing the Offered
Securities under this Underwriting Agreement will be borne and paid by the
Company if this Underwriting Agreement is terminated by the Company pursuant to
Section 10 hereof or by the Underwriter on account of the failure, refusal or
inability on the part of the Company to perform all obligations and satisfy all
conditions on the part of the Company to be performed or satisfied hereunder;
and (c) the Company will pay the cost of preparing the certificates for the
Offered Securities.
Except as otherwise provided in this Section 13, the
Underwriter agrees to pay all of its expenses in connection with investigating,
preparing to market and marketing the Offered Securities and proposing to
purchase and purchasing the Offered Securities under this Underwriting
Agreement, including the fees and expenses of their counsel and any advertising
expenses incurred by it in making offers and sales of the Offered Securities.
10. If the sale of the Offered Securities provided/or
herein is not consummated because any condition to the obligation of the
Underwriter set forth in Section 2 is not satisfied or because of any refusal,
inability or failure on the part of the Company to perform any agreement herein
or comply with any provision hereof, other than by reason of a defendant by the
Underwriter, the Company will reimburse the Underwriter, upon demand, for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel
that shall have been incurred by it in connection with the proposed offering of
the Offered Securities.
11. Notices. All communications hereunder will be in
writing and effective only on receipt, and, if sent to the Underwriter, will be
mailed, delivered or telegraphed and confirmed to the Company at One New York
Plaza - 15th Floor, New York, New York 10292-2015, attention: Peter
Riemenschneider or, if sent to the Company, will be mailed,
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<PAGE> 18
delivered or telegraphed and confirmed to it at One New York Plaza - 15th
Floor, New York, New York 10292-2015, attention: Peter Riemenschneider.
12. Successors. This Underwriting Agreement shall inure
to the benefit of and shall be binding upon the Underwriter, the Company and
their respective successors and legal representatives, and nothing expressed or
mentioned herein on in this Underwriting Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or
claim under or in respect of this Underwriting Agreement, or any provisions
herein contained, the Underwriting Agreement and all conditions and provisions
hereof being intended to be and being for the sole and exclusive benefit of
such persons and for the benefit of no other person except that (i) the
representations and warranties of the Company and the Servicer contained herein
or in this Underwriting Agreement shall also be for the benefit of any person
or persons who controls or control any Underwriter within the meaning of
Section 15 of the 1933 Act, and (ii) the indemnities by the Underwriter shall
also be for the benefit of the directors of the Company, the officers of the
Company who have signed the Registration Statement and any person or persons
who control the Company within the meaning of Section 15 of the 1933 Act. No
purchaser of the Offered Securities from the Underwriter shall be deemed a
successor because of such purchase. This Underwriting Agreement and each
Underwriting Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instruments.
13. Applicable Law; Counterparts. THIS AGREEMENT WILL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
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.
14. Time of the Essence. Time shall be of the essence of each
Underwriting Agreement.
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<PAGE> 19
If the foregoing is in accordance with your understanding,
please sign and return two counterparts hereof.
Very truly yours,
PRUDENTIAL SECURITIES SECURED
FINANCING CORPORATION
By /s/ Peter Riemenschneider
------------------------------------
Name: Peter Riemenschneider
Title: Vice President
Accepted as of The date hereof:
PRUDENTIAL SECURITIES
INCORPORATED
By /s/ Norman Chaleff
-------------------------------
Name: Norman Chaleff
Title: Managing Director
S-1
<PAGE> 20
SCHEDULE I
Title of Offered Securities:
Prudential Securities Secured Financing Corporation Commercial Mortgage
Pass-Through Certificates, Series 1995-MCF-2, Class A-1, Class C, Class D and
Class E
Terms and Conditions:
Specified funds for payment of purchase price:
Wire transfer of immediately available Federal Funds.
Required Rating:
As described in the Prospectus Supplement.
Time of Delivery:
December 28, 1995 at 10:00 A.M., New York City time.
Closing Location:
O'Melveny & Myers
153 East 53rd Street
New York, New York 10022
Names and address of Underwriter:
Address for Notices, etc: One New York Plaza
New York, New York 10292
I-1
<PAGE> 1
Exhibit 4.1
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
DEPOSITOR
MIDLAND LOAN SERVICES, L.P.,
SERVICER
LENNAR PARTNERS, INC.,
SPECIAL SERVICER
LASALLE NATIONAL BANK,
TRUSTEE
and
ABN AMRO BANK, N.V.,
FISCAL AGENT
___________________________________________________________
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 1995
___________________________________________________________
Commercial Mortgage Pass-Through Certificates
Series 1995-MCF-2
================================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C> <C>
ARTICLE I
DEFINITIONS
SECTION 1.1. Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 1.2. Certain Calculations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 1.3. Certain Constructions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.1. Conveyance and Assignment of Mortgage Loans;. . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 2.2. Acceptance by the Custodian and the Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 2.3. Representations and Warranties of the Depositor. . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 2.4. Representations, Warranties and Covenants of the Servicer and the Special Servicer . . . . . . . . 51
SECTION 2.5. Execution and Delivery of Certificates; Issuance of Lower-Tier Regular Interests . . . . . . . . . 54
SECTION 2.6. Miscellaneous REMIC Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 2.7. Documents Not Delivered to Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.1. Servicer to Act as Servicer; Special Servicer to Act as Special Servicer;
Administration of the Mortgage Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 3.2. Liability of the Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 3.3. Collection of Certain Mortgage Loan Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 3.4. Collection of Taxes, Assessments and Similar Items . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 3.5. Collection Account; Distribution Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 3.6. Permitted Withdrawals from the Collection Account . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 3.7. Investment of Funds in the Collection Account, the Distribution Account
and the Reserve Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 3.8. Maintenance of Insurance Policies and Errors and Omissions and Fidelity Coverage . . . . . . . . . 67
SECTION 3.9. Enforcement of Due-On-Sale Clauses; Assumption Agreements . . . . . . . . . . . . . . . . . . . . . 70
SECTION 3.10. Realization Upon Mortgage Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
</TABLE>
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<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 3.11. Trustee to Cooperate; Release of Mortgage Files . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 3.12. Servicing Compensation and Trustee Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 3.13. Reports to the Trustee; Collection Account Statements . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 3.14. Annual Statement as to Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
SECTION 3.15. Annual Independent Public Accountants' Servicing Report . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 3.16. Access to Certain Documentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 3.17. Title and Management of REO Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 3.18. Sale of Specially Serviced Mortgage Loans and REO Properties . . . . . . . . . . . . . . . . . . . 84
SECTION 3.19. Inspections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 3.20. Available Information and Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
SECTION 3.21. Reserve Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 3.22. Property Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 3.23. Appointment of Special Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 3.24. Transfer of Servicing Between Servicer and Special Servicer; Record Keeping . . . . . . . . . . . . 89
SECTION 3.25. Adjustment of Servicing Compensation in Respect of Prepayment Interest Shortfalls . . . . . . . . . 91
SECTION 3.26. Extension Advisor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
ARTICLE IV
DISTRIBUTIONS TO CERTIFICATEHOLDERS
SECTION 4.1. Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 4.2. Statements to Rating Agencies and Certificateholders; Available Information;
Information Furnished to Financial Market Publisher . . . . . . . . . . . . . . . . . . . . . . . . 110
SECTION 4.3. Compliance with Withholding Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
SECTION 4.4. REMIC Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
SECTION 4.5. Imposition of Tax on the Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115
SECTION 4.6. Remittances; P&I Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
ARTICLE V
THE CERTIFICATES
SECTION 5.1. The Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
SECTION 5.2. Registration, Transfer and Exchange of Certificates . . . . . . . . . . . . . . . . . . . . . . . . 120
SECTION 5.3. Book-Entry Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125
SECTION 5.4. Mutilated, Destroyed, Lost or Stolen Certificates . . . . . . . . . . . . . . . . . . . . . . . . . 126
SECTION 5.5. Appointment of Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127
</TABLE>
ii
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<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SECTION 5.6. Access to Certificateholders' Names and Addresses . . . . . . . . . . . . . . . . . . . . . . . . . 127
SECTION 5.7. Actions of Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
ARTICLE VI
THE DEPOSITOR, THE SERVICER AND THE SPECIAL SERVICER
SECTION 6.1. Liability of the Depositor, the Servicer and the Special Servicer . . . . . . . . . . . . . . . . . 129
SECTION 6.2. Merger or Consolidation of the Servicer and Special Servicer . . . . . . . . . . . . . . . . . . . 129
SECTION 6.3. Limitation on Liability of the Depositor, the Servicer and Others . . . . . . . . . . . . . . . . . 129
SECTION 6.4. Limitation on Resignation of the Servicer and of the Special Servicer . . . . . . . . . . . . . . . 130
SECTION 6.5. Rights of the Depositor and the Trustee in Respect of the Servicer
and the Special Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
ARTICLE VII
DEFAULT
SECTION 7.1. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132
SECTION 7.2. Trustee to Act; Appointment of Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 134
SECTION 7.3. Notification to Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
SECTION 7.4. Other Remedies of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
SECTION 7.5. Waiver of Past Events of Default; Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . 136
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.1. Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
SECTION 8.2. Certain Matters Affecting the Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138
SECTION 8.3. Trustee Not Liable for Certificates or Mortgage Loans . . . . . . . . . . . . . . . . . . . . . . . 140
SECTION 8.4. Trustee May Own Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142
SECTION 8.5. Payment of Trustee's Fees and Expenses; Indemnification . . . . . . . . . . . . . . . . . . . . . . 142
SECTION 8.6. Eligibility Requirements for Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143
SECTION 8.7. Resignation and Removal of the Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144
SECTION 8.8. Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 145
SECTION 8.9. Merger or Consolidation of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . 146
</TABLE>
iii
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<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SECTION 8.11. Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
SECTION 8.12. Appointment of Custodians . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 148
SECTION 8.13. Fiscal Agent Appointed; Concerning the Fiscal Agent . . . . . . . . . . . . . . . . . . . . . . . . 149
ARTICLE IX
TERMINATION
SECTION 9.1. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150
SECTION 9.2. Additional Termination Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156
SECTION 10.2. Limitation on Rights of Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156
SECTION 10.3. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157
SECTION 10.4. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157
SECTION 10.5. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
SECTION 10.6. Notice to the Depositor and Each Rating Agency . . . . . . . . . . . . . . . . . . . . . . . . . . 159
SECTION 10.7. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
SECTION 10.8. Confirmation of Intent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163
</TABLE>
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<PAGE> 6
EXHIBITS
Exhibit A-1 Form of Class A-1 Certificate
Exhibit A-2 Form of Class A-2 Certificate
Exhibit A-3 Form of Class A-EC Certificate
Exhibit A-4 Form of Class B Certificate
Exhibit A-5 Form of Class C Certificate
Exhibit A-6 Form of Class D Certificate
Exhibit A-7 Form of Class E Certificate
Exhibit A-8 Form of Class F Certificate
Exhibit A-9 Form of Class G Certificate
Exhibit A-10 Form of Class H Certificate
Exhibit A-11 Form of Class J-1 Certificate
Exhibit A-12 Form of Class J-2 Certificate
Exhibit A-13 Form of Class R Certificate
Exhibit A-14 Form of Class LR Certificate
Exhibit B Mortgage Loan Schedule
Exhibit C-1 Form of Transferee Affidavit
Exhibit C-2 Form of Transferor Letter
Exhibit D-1 Form of Investment Representation Letter
Exhibit D-2 Form of ERISA Representation Letter
Exhibit E Form of Request for Release
Exhibit F Form of Custodial Agreement
Exhibit G Form of Mortgage Loan Purchase and Sale Agreement
Exhibit H Privately Placed Securities Legend
Exhibit I Form of Seaport Participation Agreement
v
<PAGE> 7
Pooling and Servicing Agreement, dated as of December 1, 1995
among Prudential Securities Secured Financing Corporation, as Depositor,
Midland Loan Services, L.P., as Servicer, Lennar Partners, Inc. as Special
Servicer, LaSalle National Bank, as Trustee and Custodian, and ABN AMRO Bank
N.V., as Fiscal Agent of the Trustee.
PRELIMINARY STATEMENT:
(Terms used but not defined in this Preliminary Statement shall have the
meanings specified in Article I hereof)
The Depositor intends to sell pass-through certificates to be
issued hereunder in multiple classes which in the aggregate will evidence the
entire beneficial ownership interest in the Trust Fund consisting primarily of
the Mortgage Loans. As provided herein, the Trustee will elect that the Trust
Fund be treated for federal income tax purposes as two separate real estate
mortgage investment conduits (each a ``REMIC'' or, in the alternative, the
``Lower-Tier REMIC'' and the ``Upper-Tier REMIC,'' respectively). The Class
A-1, Class A-2, Class A-EC, Class B, Class C, Class D, Class E, Class F, Class
G, Class H, Class J-1 and Class J-2 Certificates constitute ``regular
interests'' in the Upper-Tier REMIC and the Class R Certificates are the sole
class of ``residual interest'' in the Upper-Tier REMIC for purposes of the
REMIC Provisions. The Class LR Certificates are the sole class of ``residual
interest'' in the Lower-Tier REMIC for purposes of the REMIC Provisions. There
are also ten classes of uncertificated Lower-Tier Regular Interests issued
under this Agreement (the Class A-L-1, Class A-L-2, Class B-L, Class C-L, Class
D-L, Class E-L, Class F-L, Class G-L, Class H-L and Class J-L Interests), each
of which will constitute a regular interest in the Lower-Tier REMIC. All such
Lower-Tier Regular Interests will be held by the Trustee as assets of the
Upper-Tier REMIC.
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<PAGE> 8
The following table sets forth the designation and aggregate
initial Certificate Balance (or, with respect to the Class A-EC and Class J-2
Certificates, the Class A-EC Notional Balance and the Class J-2 Notional
Balance, respectively) for each Class of Certificates comprising interests in
the Upper-Tier REMIC.
<TABLE>
<CAPTION>
Certificate Balance
Class or Notional Balance
----- -------------------
<S> <C>
Class A-1 $ 75,000,000
Class A-2 $ 65,040,000
Class A-EC $222,286,173.25(1)
Class B $ 8,891,000
Class C $ 13,337,000
Class D $ 8,892,000
Class E $ 15,560,000
Class F $ 5,557,000
Class G $ 12,226,000
Class H $ 11,114,000
Class J-1 $ 6,669,173.25
Class J-2 $ 6,669,173.25(1)
</TABLE>
(1) The Class A-EC and Class J-2 Certificates are not denominated in
Certificate Balance and accordingly will not receive principal
distributions. The Class A-EC and Class J-2 Certificates have an
initial Class A-EC Notional Balance and an initial Class J-2 Notional
Balance, respectively, in the amounts shown in the above table.
The initial Certificate Balance of each of the Class R and
Class LR Certificates will be zero. The Certificate Balance of any class of
Certificates outstanding at any time represents the maximum amount which
holders thereof are entitled to receive as distributions allocable to principal
from the cash flow on the Mortgage Loans and the other assets in the Trust
Fund.
As of the Cut-off Date, the Mortgage Loans have an aggregate
Scheduled Principal Balance equal to approximately $222,286,173.
In consideration of the mutual agreements herein contained,
the Depositor, the Servicer, the Special Servicer, the Trustee and the Fiscal
Agent agree as follows:
2
<PAGE> 9
ARTICLE I
DEFINITIONS
SECTION 1.1. Defined Terms.
Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the meanings
specified in this Article.
"Advance": Any P&I Advance or Property Advance.
"Advance Interest Amount": The sum for all Mortgage Loans
as to which any Advance remains unreimbursed of interest at the related Advance
Rate on the amount of any P&I Advances and Property Advances for which the
Servicer, the Trustee or the Fiscal Agent, as applicable, has not been paid or
reimbursed for the number of days from the date on which such Advance was made
or, if interest has been previously paid on such Advance, from the date on
which interest was last paid, through the date of payment or reimbursement of
the related Advance (which in no event shall be later than the Determination
Date following the date on which funds are available to reimburse such Advance
with interest thereon at the Advance Rate).
"Advance Rate": A per annum rate equal to the Prime Rate
(as published in The Wall Street Journal, or, if The Wall Street Journal is no
longer published, The New York Times, from time to time).
"Affiliate": With respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
The Trustee may obtain and rely on an Officer's Certificate of the Servicer,
the Special Servicer or the Depositor to determine whether any Person is an
Affiliate of such party.
"Aggregate Certificate Balance": As defined in Section
9.1(d)(i).
"Agreement": This Pooling and Servicing Agreement and all
amendments hereof and supplements hereto.
"Annual Debt Service": For any Mortgage Loan, the current
annual debt service (including interest allocable to payment of the Servicing
Fee) payable with respect to such Mortgage Loan during the 12-month period
commencing on the Cut-off Date (assuming no principal prepayments occur).
"Anticipated Loss": As defined in Section 4.6(c).
3
<PAGE> 10
"Anticipated Termination Date": Any Distribution Date on
which it is anticipated that the Trust Fund will be terminated pursuant to
Section 9.1(c) or Section 9.1(d).
"Applicable Monthly Payment": As defined in Section 4.6(a).
"Applicant": As defined in Section 5.6(a).
"Appraised Value": For each of the Mortgaged Properties, the
appraised value of such property as determined by an appraisal thereof,
conforming to MAI standards, made not more than one year prior to the
origination date of the related Mortgage Loan.
"Assignment of Leases, Rents and Profits": With respect to
any Mortgaged Property, any assignment of leases, rents and profits or similar
agreement executed by the Borrower, assigning to the mortgagee all of the
income, rents and profits derived from the ownership, operation, leasing or
disposition of all or a portion of such Mortgaged Property, in the form which
was duly executed, acknowledged and delivered by the Borrower, as amended,
modified, renewed or extended through the date hereof and from time to time
hereafter.
"Assignment of Mortgage": An assignment of mortgage without
recourse, notice of transfer or equivalent instrument, in recordable form,
which is sufficient under the laws of the jurisdiction in which the related
Mortgaged Property is located to reflect of record the sale of the related
Mortgage, which assignment, notice of transfer or equivalent instrument may be
in the form of one or more blanket assignments covering Mortgages encumbering
Mortgaged Properties located in the same jurisdiction, if permitted by law and
acceptable for recording; provided, however, that none of the Trustee, the
Custodian, the Special Servicer or the Servicer shall be responsible for
determining whether any assignment is legally sufficient or in recordable form.
"Assumed Scheduled Payment": With respect to any Mortgage
Loan that is delinquent in respect of its Balloon Payment (including any REO
Mortgage Loan as to which the Balloon Payment would have been past due), an
amount equal to the sum of (a) the principal portion of the Monthly Payment
that would have been due on such Mortgage Loan on a Due Date that falls on or
after the date on which such Balloon Payment was due, based on the original
amortization schedule thereof, assuming such Balloon Payment had not become
due, after giving effect to any modification, and (b) interest at the
applicable Net Mortgage Rate on the principal balance that would have remained
on such Mortgage Loan after giving effect to deemed principal payments pursuant
to clause (a) hereof on prior Due Dates.
"Assumption Fees": Any fees collected by the Servicer or
the Special Servicer in connection with an assumption or modification of a
Mortgage Loan or substitution of a Borrower thereunder permitted to be executed
under the provisions of Section 3.1, Section 3.9 or Section 3.10.
"Auction Agent": An Independent financial advisory or
investment banking or investment brokerage firm nationally recognized in the
field of real estate financial analysis and auction procedures appointed by the
Trustee pursuant to Section 9.1(d).
4
<PAGE> 11
"Auction Fees": As defined in Section 9.1(d)(v).
"Auction Procedures": As defined in Section 9.1(d)(vi).
"Auction Proceeds Distribution Date": The third
Distribution Date following an Auction Valuation Date, or such later
Distribution Date determined by the Auction Agent.
"Auction Valuation Date": Each of (i) the Distribution Date
occurring in September of each year from and including 2006 and (ii) any
Business Day on which the Trustee receives an unsolicited bona fide offer to
purchase all (but not less than all) of the Mortgage Loans.
"Authenticating Agent": Any authenticating agent appointed
by the Trustee pursuant to Section 8.11.
"Balloon Payment": With respect to each Mortgage Loan, the
scheduled payment of principal and interest due on the Maturity Date of such
Mortgage Loan which, pursuant to the related Note, is equal to the entire
remaining principal balance of such Mortgage Loan, plus accrued interest
thereon.
"Borrower": With respect to each Mortgage Loan, any obligor
on any related Note (or, in the case of the Seaport Participation Interest, the
Seaport Participation Certificate, to the extent applicable).
"Book-Entry Certificate": Any Certificate registered in the
name of the Securities Depository or its nominee.
"Business Day": Any day other than a Saturday, a Sunday or
a day on which banking institutions in the States of New York, Illinois or
Missouri are authorized or obligated by law, executive order or governmental
decree to be closed.
"Cash Deposit": An amount equal to all cash payments of
principal and interest received by the Mortgage Loan Seller in respect of the
Mortgage Loans prior to or on the Closing Date which are due after the Cut-off
Date, which amount is to be deposited with the Trustee by the Depositor
pursuant to Section 2.1.
"Certificate": Any Class A-1, Class A-2, Class A-EC, Class
B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class J-2,
Class R or Class LR Certificate issued, authenticated and delivered hereunder.
"Certificate Balance": With respect to any Class of Regular
Certificates (other than the Class A-EC and Class J- 2 Certificates) (a) on or
prior to the first Distribution Date, an amount equal to the aggregate initial
Certificate Balance of such Class, as specified in the Preliminary Statement
hereto, and (b) as of any date of determination after the first Distribution
Date, the Certificate Balance of such Class of Certificates on the Distribution
Date immediately prior to such date of determination, after application of the
distributions and Realized Losses
5
<PAGE> 12
made thereon on such prior Distribution Date; and with respect to any
Lower-Tier Regular Interest, (a) on or prior to the first Distribution Date, an
amount equal to the Certificate Balance of the Related Certificates, and (b) as
of any date of determination after the first Distribution Date, the Certificate
Balance of such Lower-Tier Regular Interest on the Distribution Date
immediately prior to such date of determination, after application of
distributions in respect of principal and Realized Losses made thereon on such
prior Distribution Date. The Class A-EC and Class J-2 Certificates have no
Certificate Balances.
"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 Securities Depository or on the books of a
Securities Depository Participant or on the books of an indirect participating
brokerage firm for which a Securities Depository Participant acts as agent.
"Certificate Register" and "Certificate Registrar": The
register maintained and the registrar appointed pursuant to Section 5.2(a).
"Certificateholder": A Person whose name is registered in
the Certificate Register; provided, however, that any Certificate held or
beneficially owned by the Depositor, the Servicer, the Trustee, a Manager or a
Borrower or any Person known to a Responsible Officer of the Certificate
Registrar to be an Affiliate of any thereof shall be deemed not to be
outstanding and the Voting Rights to which it is entitled shall not be taken
into account in determining whether the requisite percentage of Voting Rights
necessary to effect any consent has been obtained (unless such consent is to an
action which would materially adversely affect in any material respect the
interests of the Certificateholders of any Class, while the Servicer or any
Affiliate thereof is the holder of Certificates aggregating not less than
66-2/3% of the Percentage Interest of any such Class). All references herein
to "Holders" or "Certificateholders" shall reflect the rights of
Certificate Owners as they may indirectly exercise such rights through the
Securities Depository and the Securities Depository Participants, except as
otherwise specified herein.
"Class": With respect to Certificates or Lower-Tier Regular
Interests, all of the Certificates or Lower-Tier Regular Interests bearing the
same alphabetical and numerical class designation.
"Class A-1 Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on behalf
of the Depositor in substantially the form set forth in Exhibit A-1 hereto.
"Class A-1 Pass-Through Rate": A per annum rate equal to
6.525%.
"Class A-2 Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on behalf
of the Depositor in substantially the form set forth in Exhibit A-2 hereto.
"Class A-2 Pass-Through Rate": A per annum rate equal to
6.84%.
6
<PAGE> 13
"Class A-EC Certificate": Any one of the Certificates
executed and authenticated by the Trustee or the Authenticating Agent on behalf
of the Depositor in substantially the form set forth in Exhibit A-3 hereto.
"Class A-EC Excess Interest": With respect to any
Distribution Date, an amount equal to the Class A-EC Pass- Through Rate
multiplied by the Class A-EC Notional Balance. Class A-EC Excess Interest
represents a portion of the interest payments on the Class A-L-1 Interest, the
Class A-L-2 Interest, the Class B-L Interest, the Class C-L Interest, the Class
D-L Interest, the Class E-L Interest, the Class F-L Interest, the Class G-L
Interest and the Class H-L Interest.
"Class A-EC Notional Balance": As of any date of
determination, an amount equal to the sum of (i) the Class A-EC Notional
Component A and (ii) the Certificate Balances of the Class B Certificates, the
Class C Certificates, the Class D Certificates, the Class E Certificates, the
Class F Certificates, the Class G Certificates, the Class H Certificates and
the Class J-1 Certificates.
"Class A-EC Notional Component A": As of any date of
determination, an amount equal to the sum of the Certificate Balances of the
Class A-1 Certificates and the Class A-2 Certificates.
"Class A-EC Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the excess of the Weighted Average
Net Mortgage Rate over the weighted averages of the Pass-Through Rates of the
P&I Certificates (weighted in each case on the basis of a fraction equal to the
Certificate Balance of each such Class of Certificates divided by the sum of
the Certificate Balances of the P&I Certificates and the Class J-1 Certificates
as of the first day of such Interest Accrual Period) and the Class J-2
Pass-Through Rate (weighted on the basis of a fraction equal to the Class J-2
Notional Balance divided by the sum of the Certificate Balances of the P&I
Certificates and the Class J-1 Certificates, each as of the first day of such
Interest Accrual Period). For purposes of this definition, the Pass-Through
Rates of the Class F, Class G and Class H Certificates shall be equal to the
Weighted Average Net Mortgage Rate.
"Class A-L-1 Interest": A regular interest in the
Lower-Tier REMIC entitled to monthly distributions payable thereto pursuant to
Section 4.1.
"Class A-L-2 Interest": A regular interest in the
Lower-Tier REMIC entitled to monthly distributions payable thereto pursuant to
Section 4.1.
"Class B Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-4 hereto.
"Class B Pass-Through Rate": A per annum rate equal to
6.905%
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"Class B-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class C Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-5 hereto.
"Class C Pass-Through Rate": A per annum rate equal to
7.015%.
"Class C-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class D Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-6 hereto.
"Class D Pass-Through Rate": A per annum rate equal to
7.165%.
"Class D-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class E Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-7 hereto.
"Class E Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to 7.610%.
"Class E-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class F Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-8 hereto.
"Class F Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the higher of (i) the Weighted
Average Net Mortgage Rate and (ii) 7.64%
"Class F-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class G Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-10 hereto.
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<PAGE> 15
"Class G Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the higher of (i) the Weighted
Average Net Mortgage Rate and (ii) 7.64%.
"Class G-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class H Certificate": Any one of the Certificates executed
and authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-10 hereto.
"Class H Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the higher of (i) the Weighted
Average Net Mortgage Rate and (ii) 7.64%.
"Class H-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class Interest Distribution Amount": With respect to any
Distribution Date and any of the Class A-1, Class A-2, Class B, Class C, Class
D, Class E, Class F, Class G and Class H Certificates, interest for the related
Interest Accrual Period at the applicable Pass-Through Rate for such Class of
Certificates for such Interest Accrual Period on the Certificate Balance of
such Class. With respect to any Distribution Date and the Class A-EC
Certificates, (a) for any Distribution Date occurring on or prior to the EC
Maturity Date, the Class A-EC Excess Interest and, (b) thereafter, zero. With
respect to the Class J-1 Certificates, zero. With respect to any Distribution
Date and the Class J-2 Certificates, an amount equal to the product of the
Class J-2 Pass-Through Rate and the Class J-2 Notional Balance. The Class
Interest Distribution Amount of the Class J-2 Certificates represents a
specified portion equal to 100% of the interest payments on the Class J-L
Interest. For purposes of determining any Class Interest Distribution Amount,
any distributions in reduction of Certificate Balance, any reductions of
Certificate Balance (and any resulting reductions in Notional Balance) as a
result of allocations of Realized Losses on the Distribution Date occurring in
such Interest Accrual Period shall be deemed to have been made as of the first
day of such Interest Accrual Period. Notwithstanding the foregoing, the Class
Interest Distribution Amount for each Class of Certificates otherwise
calculated as described above shall be reduced by such Class' pro rata share of
any Uncovered Prepayment Interest Shortfall for such Distribution Date (pro
rata according to each respective Class' Class Interest Distribution Amount
determined without regard to this sentence).
"Class Interest Shortfall": On any Distribution Date for
any Class of Certificates, the excess, if any, of the Class Interest
Distribution Amount for such Class over the amount of interest actually
distributed in respect of such Class Interest Distribution Amount to the
Holders of such Certificates pursuant to Section 4.1(b) on such Distribution
Date.
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<PAGE> 16
"Class J-1 Certificate": Any one of the Certificates
executed and authenticated by the Trustee or Authenticating Agent on behalf of
the Depositor in substantially the form set forth in Exhibit A-11 hereto.
"Class J-2 Certificate": Any one of the Certificates
executed and authenticated by the Trustee or Authenticating Agent on behalf of
the Depositor in substantially the form set forth in Exhibit A-10 hereto.
"Class J-2 Notional Balance": As of any date of
determination, an amount equal to the Certificate Principal Balance of the
Class J-1 Certificates.
"Class J-2 Pass-Through Rate": With respect to any Interest
Accrual Period, a per annum rate equal to the Weighted Average Net Mortgage
Rate.
"Class J-L Interest": A regular interest in the Lower-Tier
REMIC entitled to the monthly distributions payable thereto pursuant to Section
4.1.
"Class LR Certificate": Any Certificate executed and
authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-14 hereto. The
Class LR Certificates have no Pass-Through Rate or Certificate Balance.
"Class R Certificate": Any Certificate executed and
authenticated by the Trustee or the Authenticating Agent on behalf of the
Depositor in substantially the form set forth in Exhibit A-13 hereto. The
Class R Certificates have no Pass-Through Rate or Certificate Balance.
"Closing Date": December 22, 1995.
"Code": The Internal Revenue Code of 1986, as amended from
time to time, any successor statute thereto, and any temporary or final
regulations of the United States Department of the Treasury promulgated
pursuant thereto.
"Collection Account": The segregated account or accounts
created and maintained by the Servicer pursuant to Section 3.5(a), which shall
be entitled "LaSalle National Bank, as Trustee, in trust for Holders of
Prudential Securities Secured Financing Corporation, Commercial Mortgage
Pass-Through Certificates, Series 1995-MCF-2, Collection Account" and which
shall be an Eligible Account.
"Collection Period": With respect to any Distribution Date
and any Mortgage Loan other than the Seaport Participation Interest, the period
beginning on the first day following the Determination Date in the month
preceding the month in which such Distribution Date occurs (or, in the case of
the Distribution Date occurring in January, 1996, on the day after the Cut-off
Date) and ending on the Determination Date in the month in which such
Distribution Date occurs, and with respect to any Distribution Date and the
Seaport Participation Interest, the period beginning on the first day following
the remittance date under the Prior Pooling and
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<PAGE> 17
Servicing Agreement in the month preceding the month in which such Distribution
Date occurs (or, in the case of the Distribution Date occurring in January,
1996, on the day after the Cut-off Date) and ending on the remittance date
under the prior Pooling and Servicing Agreement in the month in which such
Distribution Date occurs.
"Commission": The Securities and Exchange Commission of the
United States of America.
"Condemnation Proceeds": Any amount (other than Insurance
Proceeds) received in connection with the taking of a Mortgaged Property by
exercise of the power of eminent domain or condemnation.
"Corporate Trust Office": The principal office of the
Trustee located at 135 S. LaSalle Street, Suite 200, Chicago, Illinois 60603,
Attention: Asset Backed Securities Trust Services Dept., or the principal trust
office of any successor trustee qualified and appointed pursuant to Section
8.8.
"Custodial Agreement": The Custodial Agreement, if any, in
effect from time to time between the Custodian named therein, the Servicer and
the Trustee, substantially in the form of Exhibit F hereto, as the same may be
amended or modified from time to time in accordance with the terms thereof.
"Custodian": Any Custodian appointed pursuant to Section
8.12 and, unless the Trustee is Custodian, named pursuant to any Custodial
Agreement. The Custodian may (but need not) be the Trustee or the Servicer or
any Affiliate of the Trustee or the Servicer, but may not be the Depositor or
any Affiliate of the Depositor.
"Cut-off Date": December 1, 1995; provided, however, that
references to the principal balance of Mortgage Loans No. 95-0903231 and
95-0903232 (or other terms derived in part by reference to the principal of
balance of such Mortgage Loans) as of the Cut-off Date shall refer to the
principal balance of such Mortgage Loans as of December 4, 1995 and references
to the principal balance of Mortgage Loans No. 95-0900581, 95-0902096 and
95-0902526 (or other terms derived in part by reference to the principal of
balance of such Mortgage Loans) as of the Cut-off Date shall refer to the
principal balance of such Mortgage Loan as of December 6, 1995.
"Debt Service Coverage Ratio": With respect to any Mortgage
Loan, (a) the Underwritten Cash Flow for the related Mortgaged Property,
divided by (b) the Annual Debt Service for such Mortgage Loan.
"Default Interest": With respect to any Mortgage Loan,
interest accrued on such Mortgage Loan at the excess of the Default Rate over
the Mortgage Rate.
"Default Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan following any event
of default on such Mortgage Loan,
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including a default in the payment of a Monthly Payment or a Balloon Payment,
as such rate is set forth in the Mortgage Loan Schedule.
"Deficient Auction Bid": As defined in Section 9.1(d)(iii).
"Definitive Certificate": As defined in Section 5.3(a).
"Depositor": Prudential Securities Secured Financing
Corporation, a Delaware corporation and its successors and assigns.
"Determination Date": The 17th day of any month, or if such
17th day is not a Business Day, the Business Day immediately following such
17th day, commencing on January 17, 1996.
"Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the tenants thereof that are not
customarily provided to tenants in connection with the rental of space for
occupancy only within the meaning of Treasury Regulations Section
1.512(h)-1(c)(5), the management or operation of such REO Property, the holding
of such REO Property primarily for sale to customers or any use of such REO
Property in a trade or business conducted by the Trust Fund other than through
an Independent Contractor; provided, however, that the Servicer, on behalf of
the Trust Fund (or the Special Servicer on behalf of the Trust Fund), shall not
be considered to Directly Operate an REO Property solely because the Servicer,
on behalf of the Trust Fund (or the Special Servicer on behalf of the Trust
Fund), establishes rental terms, chooses tenants, enters into or renews leases,
deals with taxes and insurance, or makes decisions as to repairs or capital
expenditures with respect to such REO Property.
"Discount Rate": The rate determined by the Trustee in
connection with distributions pursuant to Section 4.1(c)(I) to be the rate
(interpolated and rounded to the nearest one-thousandth of a percent, if
necessary) in the secondary market on the United States Treasury security with
a maturity equal to the then-computed weighted average life of the related
Class of Certificates (rounded to the nearest month) (without taking into
account the related prepayment and assuming (i) no further prepayments on the
Mortgage Loans and (ii) no delinquencies or defaults with respect to payments
on the Mortgage Loans) plus 0.50% per annum.
"Disposition Fee": With respect to any Specially Serviced
Mortgage Loan or REO Property which is sold or transferred or otherwise
liquidated, an amount equal to the product of (I) the excess, if any of (a) the
Liquidation Proceeds of such Specially Serviced Mortgage Loan or REO Property
minus (b) any broker's commission and related brokerage referral fees, times
(II) (a) 1.5%, if such sale or liquidation occurs prior to 12 months following
the date on which the related Mortgage Loan initially became a Specially
Serviced Mortgage Loan, or (b) 1.0%, if such sale or liquidation occurs upon or
after the expiration of such 12-month period.
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"Disqualified Non-U.S. Person": With respect to a Class R
or Class LR Certificate, any Non-U.S. Person or agent thereof other than (i) a
Non-U.S. Person that holds the Class R or Class LR Certificate in connection
with the conduct of a trade or business within the United States and has
furnished the transferor and the Certificate Registrar with an effective IRS
Form 4224 or (ii) a Non-U.S. Person that has delivered to both the transferor
and the Certificate Registrar an Opinion of Counsel to the effect that the
transfer of the Class R or Class LR Certificate to it is in accordance with the
requirements of the Code and the regulations promulgated thereunder and that
such transfer of the Class R or Class LR Certificate will not be disregarded
for federal income tax purposes.
"Disqualified Organization": Either (a) the United States,
a State or any political subdivision thereof, any possession of the United
States, or any agency or instrumentality of any of the foregoing (other than an
instrumentality that is a corporation if all of its activities are subject to
tax and a majority of its board of directors is not selected by any such
governmental unit), (b) a foreign government, International Organization or
agency or instrumentality of either of the foregoing, (c) an organization that
is exempt from tax imposed by Chapter 1 of the Code (including the tax imposed
by Code Section 511 on unrelated business taxable income) on any excess
inclusions (as defined in Code Section 860E(c)(1)) with respect to the Class R
or Class LR Certificates (except certain farmers' cooperatives described in
Code Section 521), (d) rural electric and telephone cooperatives described in
Code Section 1381(a)(2), or (e) any other Person so designated by the
Certificate Registrar based upon an Opinion of Counsel to the effect that any
Transfer to such Person may cause the Upper-Tier REMIC or Lower-Tier REMIC to
fail to qualify as a REMIC at any time that the Certificates are outstanding.
The terms "United States," "State" and "International Organization" shall
have the meanings set forth in Code Section 7701 or successor provisions.
"Distribution Account": The segregated account or accounts
created and maintained as a separate trust account or accounts by the Trustee
pursuant to Section 3.5(b), which shall be entitled "LaSalle National Bank, as
Trustee, in trust for Holders of Prudential Securities Secured Financing
Corporation Commercial Mortgage Pass-Through Certificates, Series 1995-MCF-2,
Distribution Account" and which shall be an Eligible Account.
"Distribution Date": The 25th day of any month, or if such
25th day is not a Business Day, the Business Day immediately following such
25th day, commencing on January 25, 1996.
"Due Date": With respect to any Collection Period and any
Mortgage Loan, the date on which scheduled payments are due on such Mortgage
Loan (without regard to grace periods), such date being for all Mortgage Loans
other than Mortgage Loan No. 95-0900581 and the Seaport Participation Interest
the first day of each month, and for Mortgage Loan No. 95-0900581 the sixth day
of the month, and for the Seaport Participation Interest, the remittance date
under Prior Pooling and Servicing Agreement.
"Duff & Phelps": Duff & Phelps Credit Rating Co., or its
successor in interest.
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<PAGE> 20
"Early Termination Notice Date": Any date as of which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
"EC Maturity Date": November 27, 2006.
"Eligible Account": Either (i) a segregated account or
accounts maintained with a federally or state-chartered depository institution
or trust company, the long term unsecured debt obligations of which (or of such
institution's parent holding company) are assigned a rating by each Rating
Agency that is greater than or equal to the rating then assigned to the Class
of Certificates outstanding at the time of any deposit therein which has the
highest rating then assigned of any such outstanding Class or (ii) a segregated
trust account or accounts maintained with a federally or state-chartered
depository institution or trust company acting in its fiduciary capacity,
having, in either case, a combined capital and surplus of at least $50,000,000
and subject to supervision or examination by federal or state authority, or
otherwise confirmed in writing by each of the Rating Agencies that the
maintenance of such account, which may be an account maintained with the
Trustee or the Servicer, shall not, in and of itself, result in a downgrading,
withdrawal or qualification of the rating then assigned by such Rating Agency
to any Class of Certificates. Eligible Accounts may bear interest.
"Eligible Investor": (i) A Qualified Institutional Buyer
that is purchasing Privately Placed Certificates for its own account or for the
account of a Qualified Institutional Buyer to whom notice is given that the
offer, sale or transfer is being made in reliance on Rule 144A promulgated
under the 1933 Act or (ii) with respect to Privately Placed Certificates other
than the Class R and Class LR Certificates, an Institutional Accredited
Investor.
"Environmental Report": With respect to each Mortgaged
Property, the environmental audit report or reports delivered to the Mortgage
Loan Seller in connection with the purchase of the related Mortgage Loan from
the Originator of such Mortgage Loan.
"ERISA": The Employee Retirement Income Security Act of
1974, as it may be amended from time to time.
"Escrow Account": As defined in Section 3.4(b).
"Escrow Payment": Any payment made by any Borrower to the
Servicer for the account of such Borrower for application toward the payment of
taxes, insurance premiums, assessments and similar items in respect of the
related Mortgaged Property and the payment of the Financial and Lease Reporting
Fee.
"Event of Default": As defined in Section 7.1.
"Extension Advisor": The Person who has the right to
approve the actions of the Special Servicer in granting extensions as set forth
in Section 3.26. Midland Loan Services, L.P. shall serve as the initial
Extension Advisor.
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"Extension Advisory Fee": With respect to each Mortgage
Loan as to which an extension is requested after three successive extensions
have been granted in accordance with Section 3.10(a), 0.04% of the Scheduled
Principal Balance of such Mortgage Loan; provided that so long as the Midland
Loan Services L.P. is the Extension Advisor the Extension Advisory Fee will be
zero.
"FDIC": The Federal Deposit Insurance Corporation, or any
successor thereto.
"FHA": The Federal Housing Administration.
"FHLMC": The Federal Home Loan Mortgage Corporation, or any
successor thereto.
"Final Recovery Determination": With respect to any REO
Mortgage Loan, Specially Serviced Mortgage Loan or Mortgage Loan subject to
repurchase by Midland L.P. or the Mortgage Loan Seller pursuant to Section
2.3(d) or 2.3(e), the recovery of all Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds, the related Repurchase Price and other payments
or recoveries (including proceeds of the final sale of any related REO
Property) which the Servicer, in its reasonable judgment as evidenced by a
certificate of a Servicing Officer delivered to the Trustee and the Custodian,
expects to be finally recoverable. The Servicer shall maintain records,
prepared by a Servicing Officer, of each Final Recovery Determination until the
earlier of (i) its termination as Servicer hereunder and the transfer of such
records to a successor servicer and (ii) five years following the termination
of the Trust Fund.
"Financial and Lease Reporting Fee": Any payment made by
any Borrower under the related Note as a deposit to ensure that such Borrower
furnishes to the mortgagee the required financial and leasing information on a
timely basis during the term of the related Mortgage Loan.
"Financial Market Publisher": Bloomberg Financial Service.
"Fiscal Agent": ABN AMRO Bank N.V., in its capacity as
fiscal agent of the Trustee, or its successor in interest, or any successor
fiscal agent appointed as herein provided.
"Fitch": Fitch Investors Service, L.P., or its successor in
interest.
"FNMA": The Federal National Mortgage Association, or any
successor thereto.
"Hazardous Materials": Any dangerous, toxic or hazardous
pollutants, chemicals, wastes, or substances, including, without limitation,
those so identified pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. Section 9601 et seq., or any other
environmental laws now existing, and specifically including, without
limitation, asbestos and asbestos-containing materials, polychlorinated
biphenyls, radon gas, petroleum and petroleum products, urea formaldehyde and
any substances classified as being "in inventory", "usable work in process"
or similar classification which would, if classified as unusable, be included
in the foregoing definition.
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"Holder": With respect to any Certificate, a
Certificateholder; with respect to any Lower-Tier Regular Interest, the
Trustee.
"Indemnified Party": As defined in Section 8.5(c).
"Independent": When used with respect to any specified
Person, any other Person who (i) does not have any direct financial interest,
or any material indirect financial interest, in any of the Manager, the
Depositor, the Servicer, the Special Servicer, any Borrower or any Affiliate
thereof, and (ii) is not connected with any such specified Person as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions.
"Independent Contractor": Either (i) any Person that would
be an "independent contractor" with respect to the Trust Fund within the
meaning of Section 856(d)(3) of the Code if the Trust Fund were a real estate
investment trust (except that the ownership tests set forth in that section
shall be considered to be met by any Person that owns, directly or indirectly,
35% or more of any Class or 35% or more of the aggregate value of all Classes
of Certificates), provided that the Trust Fund does not receive or derive any
income from such Person and the relationship between such Person and the Trust
Fund is at arm's length, all within the meaning of Treasury Regulations Section
1.856-4(b)(5) (except that the Servicer shall not be considered to be an
Independent Contractor under the definition in this clause (i) unless an
Opinion of Counsel (obtained at the expense of the Servicer) addressed to the
Servicer and the Trustee has been delivered to the Trustee to the effect that
the Servicer meets the requirements of such definition) or (ii) any other
Person (including the Servicer) if the Servicer, on behalf of itself and the
Trustee, has received an Opinion of Counsel (obtained at the expense of the
party seeking to be deemed an Independent Contractor) to the effect that the
taking of any action in respect of any REO Property by such Person, subject to
any conditions therein specified, that is otherwise herein contemplated to be
taken by an Independent Contractor will not cause such REO Property to cease to
qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code (determined without regard to the exception applicable for purposes of
Section 860D(a) of the Code) or cause any income realized with respect of such
REO Property to fail to qualify as Rents from Real Property (provided that such
income would otherwise so qualify).
"Individual Certificate": Any Certificate in definitive,
fully registered form without interest coupons.
"Institutional Accredited Investor": An entity meeting the
requirements of Rule 501(a)(1), (2), (3) or (7) of Regulation D promulgated
under the 1933 Act and which is not otherwise a Qualified Institutional Buyer.
"Insurance Proceeds": Proceeds of any fire and hazard
insurance policy, title policy or other insurance policy relating to a Mortgage
Loan and/or the Mortgaged Property securing any Mortgage Loan (including any
amounts paid by the Servicer or the Special Servicer pursuant to Section 3.8),
to the extent such proceeds are not to be applied to the restoration of the
related Mortgaged Property or released to the Borrower in accordance with the
express
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requirements of the related Mortgage or Note or other documents including in
the related Mortgage File or in accordance with prudent and customary servicing
practices.
"Interest Accrual Period": With respect to any Distribution
Date, the calendar month preceding the month in which such Distribution Date
occurs. Interest for each Interest Accrual Period shall be calculated based on
a 360-day year consisting of twelve 30-day months.
"Interest Distribution Amount": With respect to any
Lower-Tier Regular Interest and any Distribution Date, interest for the related
Interest Accrual Period at the Lower-Tier Pass-Through Rate for such Interest
Accrual Period on the Certificate Balance of such Lower-Tier Regular Interest,
provided that, for such purpose, any distributions in reduction of the
Certificate Balance and reductions of the Certificate Balance as a result of
allocations of Realized Losses on the Distribution Date occurring in such
Interest Accrual Period shall be deemed to have been made as of the first day
of such Interest Accrual Period.
"Interest Shortfall": With respect to any Distribution Date
for any Lower-Tier Regular Interest, the excess, if any, of the Interest
Distribution Amount of such Lower-Tier Regular Interest on such Distribution
Date over the amount actually distributed to such Lower-Tier Regular Interest
in respect of its Interest Distribution Amount on such Distribution Date.
"Interested Person": As of any date of determination, the
Depositor, the Servicer, the Special Servicer, the Trustee, any Borrower, any
Manager of a Mortgaged Property, any Independent Contractor engaged by the
Special Servicer pursuant to Section 3.17, or any Person known to a Responsible
Officer of the Trustee to be an Affiliate of any of them.
"Investment Account": As defined in Section 3.7(a).
"Investment Representation Letter": As defined in Section
5.2(c)(i).
"IRS": The Internal Revenue Service.
"Liquidation Expenses": Expenses incurred by the Special
Servicer and the Trustee in connection with the liquidation of any Specially
Serviced Mortgage Loan or property acquired in respect thereof (including,
without limitation, legal fees and expenses, committee or referee fees, and, if
applicable, brokerage commissions, and conveyance taxes) and any Property
Protection Expenses incurred with respect to such Specially Serviced Mortgage
Loan or such property not previously reimbursed from collections or other
proceeds therefrom.
"Liquidation Proceeds": The amount (other than Insurance
Proceeds) received in connection with (i) the taking of a Mortgaged Property by
exercise of the power of eminent domain or condemnation, (ii) the liquidation
of a Specially Serviced Mortgage Loan through a trustee's sale, foreclosure
sale or otherwise, (iii) the sale of a Specially Serviced Mortgage Loan or an
REO Property in accordance with Section 3.18 or (iv) the sale of all of the
Mortgage Loans in accordance with Section 9.1.
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"Loan Agreement": With respect to any Mortgage Loan, the
loan agreement, if any, between the Originator and the Borrower, pursuant to
which such Mortgage Loan was made.
"Loan Number": With respect to any Mortgage Loan, the loan
number by which such Mortgage Loan was identified on the books and records of
the Servicer or any subservicer for the Servicer, as set forth in the Mortgage
Loan Schedule.
"Loan-to-Value Ratio": With respect to any Mortgage Loan,
(a) the principal balance of such Mortgage Loan as of the Cut-off Date, divided
by (b) the Appraised Value of the related Mortgaged Property.
"Lower-Tier Pass-Through Rate": With respect to any
Distribution Date on or prior to the EC Maturity Date and any Class of
Lower-Tier Regular Interests other than the Class F-L, the Class G-L and the
Class H-L Interests, a per annum rate equal to the Weighted Average Net
Mortgage Rate for the related Interest Accrual Period, and with respect to the
Class F-L, the Class G-L and the Class H-L Interests, a per annum rate equal to
the higher of the Weighted Average Net Mortgage Rate for the related Interest
Accrual Period and 7.64%. For each Distribution Date following the EC Maturity
Date and each of the Class A-L-1, Class A-L-2, Class B-L, Class C-L, Class D-L
and Class E-L Interests, a rate equal to the Pass-Through Rate of the Related
Certificate. For each Distribution Date following the EC Maturity Date and the
Class F-L, G-L and Class H-L Interests, a per annum rate equal to the higher of
the Weighted Average Net Mortgage Rate for the related Interest Accrual Period
and 7.64% for each Distribution Date following the EC Maturity Date and the
Class J-L Interest, a per annum rate equal to the Weighted Average Net Mortgage
Rate for the related Interest Accrual Period.
"Lower-Tier Regular Interests": The Class A-L-1, Class
A-L-2, Class B-L, Class C-L, Class D-L, Class E-L, Class F-L, Class G-L, Class
H-L and Class J-L Interests.
"Lower-Tier REMIC": A segregated asset pool within the
Trust Fund consisting of the Mortgage Loans, collections thereon, any REO
Property acquired in respect thereof and amounts held from time to time in the
Collection Account.
"MAI": Member of the Appraisal Institute.
"Management Agreement": With respect to any Mortgage Loan,
the Management Agreement, if any, by and between the Manager and the related
Borrower, or any successor Management Agreement between such parties.
"Manager": With respect to any Mortgage Loan, any property
manager for the related Mortgaged Property.
"Maturity Date": With respect to each Mortgage Loan, the
maturity date as set forth in the Mortgage Loan Schedule.
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"Midland L.P.": Midland Loan Services, L.P., together with
its successor and assigns.
"Monthly Payment": With respect to any Mortgage Loan (other
than any REO Mortgage Loan) and any Due Date, the scheduled monthly payment of
principal and interest, excluding any Balloon Payment, on such Mortgage Loan
which is payable by the related Borrower on such Due Date under the related
Note (after giving effect to any extension or modification permitted
hereunder). With respect to any REO Mortgage Loan, the monthly payment which
would otherwise have been payable on such Due Date had the related Note not
been discharged (after giving effect to any extension or other modification),
determined as set forth in the preceding sentence and on the assumption that
all other amounts, if any, due thereunder are paid when due.
"Mortgage": The mortgage, deed of trust or other instrument
creating a first lien on or first priority ownership interest in a Mortgaged
Property securing the related Note.
"Mortgage File": With respect to any Mortgage Loan, the
mortgage documents required to be maintained in either the Trustee Mortgage
File or the Servicer Mortgage File.
"Mortgage Loan": Each of (i) the mortgage loans transferred
and assigned to the Trustee pursuant to Section 2.1 and from time to time held
in the Trust Fund, such mortgage loans originally so transferred, assigned and
held being identified on the Mortgage Loan Schedule as of the Cut-off Date and
(ii) the Seaport Participation Interest. Such term shall include any REO
Mortgage Loan.
"Mortgage Loan Documents": Any and all documents contained
in the Trustee Mortgage File and the Servicer Mortgage File.
"Mortgage Loan Purchase and Sale Agreement": The Mortgage
Loan Purchase and Sale Agreement, dated as of the Cut- off Date, by and among
the Depositor, the Mortgage Loan Seller and Midland L.P., substantially in the
form attached hereto as Exhibit G.
"Mortgage Loan Schedule": As of any date, the list of
Mortgage Loans included in the Trust Fund on such date, such list as of the
Closing Date being attached hereto as Exhibit B, which list shall set forth the
following information with respect to each Mortgage Loan:
(a) the Loan Number;
(b) the property name of the related Mortgaged Property
and the city and state where such Mortgaged Property
is located;
(c) the Monthly Payment in effect as of the Cut-off Date;
(d) the Mortgage Rate and the Default Rate;
(e) the Maturity Date;
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(f) the period over which scheduled principal payments on
such Mortgage Loan would amortize the principal
balance thereof;
(g) the Debt Service Coverage Ratio and Loan to Value
Ratio.
(h) the Scheduled Principal Balance as of the Cut-off
Date and, as applicable, the allocation of such
balance to each related Mortgaged Property;
(i) if applicable, the name of the Manager for the
related Mortgaged Property;
(j) whether such Mortgage Loan permits Non-Premium
Prepayments;
(k) a description of the Prepayment Premium payable with
respect to such Mortgage Loan;
(l) the Loan Number of any Mortgage Loan with which such
Mortgage Loan is cross-collateralized or
cross-defaulted;
(m) whether such Mortgage Loan is secured by a fee simple
interest or a leasehold interest in the related
Mortgaged Property or both;
(n) the property type of the Mortgaged Property securing
such Mortgage Loan; and
(o) the originator of such Mortgage Loan.
The Mortgage Loan Schedule shall also set forth the total of the amounts
described under clause (c) and (g) above for all of the Mortgage Loans. The
Mortgage Loan Schedule may be in the form of more than one list, collectively
setting forth all of the information required.
"Mortgage Loan Seller": Midland Commercial Financing Corp.,
a Missouri corporation, and its successors in interest.
"Mortgage Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan (in the absence of
a default), as set forth in the Mortgage Loan Schedule.
"Mortgaged Property": The underlying property securing a
Mortgage Loan (other than the Seaport Participation Interest), including any
REO Property, consisting of a fee simple or leasehold estate in a parcel of
land improved by a commercial property, together with any personal property,
fixtures, leases and other property or rights pertaining thereto.
"Net Liquidation Proceeds": The excess of Liquidation
Proceeds received with respect to any Mortgage Loan over the amount of
Liquidation Expenses incurred with respect thereto.
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<PAGE> 27
"Net Mortgage Rate": With respect to any Mortgage Loan, the
Mortgage Rate for such Mortgage Loan minus the Servicing Fee Rate.
"Net REO Proceeds": With respect to each REO Property, REO
Proceeds with respect to such REO Property net of any insurance premiums,
taxes, assessments and other costs and expenses permitted to be paid therefrom
pursuant to Section 3.17(b).
"New Lease": Any lease of REO Property entered into on
behalf of the Trust Fund, including any lease renewed or extended on behalf of
the Trust Fund if the Trust Fund has the right to renegotiate the terms of such
lease.
"1933 Act": The Securities Act of 1933, as it may be amended
from time to time.
"1934 Act": The Securities Exchange Act of 1934, as it may be
amended from time to time.
"Non-Premium Prepayment": Any Principal Prepayment received
that is not required to be accompanied by a Prepayment Premium.
"Nonrecoverable Advance ": Any portion of an Advance
proposed to be made or previously made which has not been previously reimbursed
to the Servicer, the Trustee or the Fiscal Agent, as applicable, and which the
Servicer, the Trustee or the Fiscal Agent has determined, based on an internal
or external appraisal conducted in accordance with MAI standards and
methodologies (which appraisal shall have been conducted within the 12 months
preceding any such determination) or, in the event that a Phase I or Phase II
environmental report has been conducted which leads the Servicer to determine
that foreclosing upon or otherwise obtaining title to the related Mortgaged
Property would be prohibited in accordance with the provisions of Section
3.10(f), based on such environmental report, will not or, in the case of a
proposed Advance, would not, be ultimately recoverable by the Servicer, the
Trustee or the Fiscal Agent, as applicable, from late payments, Insurance
Proceeds, Condemnation Proceeds, Liquidation Proceeds and other collections on
or in respect of the related Mortgage Loan. To the extent that any Borrower is
not obligated under the related Mortgage Loan Documents to pay or reimburse any
portion of any Advances that are outstanding with respect to the related
Mortgage Loan as a result of a modification of such Mortgage Loan by the
Special Servicer which forgives unpaid Monthly Payments or other amounts which
the Servicer had previously advanced, and the Servicer determines that no other
source of payment or reimbursement for such advances is available to it, such
Advances shall be deemed to be nonrecoverable; provided, however, that in
connection with the foregoing the Servicer shall provide an Officer's
Certificate as described below. The determination by the Servicer, the Trustee
or the Fiscal Agent, as applicable, that it has made a Nonrecoverable Advance
or that any proposed Advance, if made, would constitute a Nonrecoverable
Advance shall be evidenced by a certificate of a Servicing Officer, Responsible
Officer or Vice President or equivalent or senior officer of the Fiscal Agent,
as appropriate, delivered to the Trustee, the Special Servicer and the
Depositor setting forth such determination and the procedures and
considerations of the Servicer, the Trustee or Fiscal Agent, as applicable,
forming the basis of such determination
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<PAGE> 28
(including a copy of the appraisal or environmental report which was the basis
for such determination). Notwithstanding the above, the Trustee and the Fiscal
Agent shall be entitled to rely upon any determination by the Servicer that any
Advance previously made is a Nonrecoverable Advance or that any proposed
Advance, if made, would constitute a Nonrecoverable Advance.
"Non-U.S. Person": A person that is not 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 subject to United
States federal income tax regardless of its source.
"Note": With respect to any Mortgage Loan (other than the
Seaport Participation Certificate) as of any date of determination, the note or
other evidence of indebtedness and/or agreements evidencing the indebtedness of
the related Borrower or obligor under such Mortgage Loan, and in the case of
the Seaport Participation Interest, to the extent applicable, the Seaport
Participation Certificate, in each case, including any amendments or
modifications, or any renewal or substitution notes, as of such date.
"Notice of Termination": Any of (i) the notices given to
the Trustee by the Servicer or any Holder of a Class LR Certificate pursuant to
Section 9.1(c) and (ii) the notice given by the Trustee to each Holder pursuant
to Section 9.1(d)(iv).
"Officer's Certificate": A certificate signed by the
Chairman of the Board, the Vice Chairman of the Board, the President, a Vice
President (however denominated), the Treasurer, the Secretary, one of the
Assistant Treasurers or Assistant Secretaries or any other officer of the
general partner of the Servicer, Special Servicer or the Auction Agent
customarily performing functions similar to those performed by any of the above
designated officers and also with respect to a particular matter, any other
officer to whom such matter is referred because of such officer's knowledge of
and familiarity with the particular subject, or an authorized officer of the
Depositor, and delivered to the Depositor, the Trustee, the Special Servicer or
the Servicer, as the case may be.
"Opinion of Counsel": A written opinion of counsel, who
may, without limitation, be counsel for the Depositor, the Special Servicer or
the Servicer, as the case may be, acceptable to the Trustee, except that any
opinion of counsel relating to (a) qualification of the Upper-Tier REMIC or
Lower-Tier REMIC as a REMIC or the imposition of tax under the REMIC Provisions
on any income or property of either REMIC, (b) compliance with the REMIC
Provisions (including application of the definition of "Independent
Contractor") or (c) a resignation of the Servicer or the Special Servicer
pursuant to Section 6.4, must be an opinion of counsel who is Independent of
the Depositor, the Special Servicer and the Servicer.
"Originator": With respect to a Mortgage Loan, the
originator of such Mortgage Loan, as identified in the Mortgage Loan Schedule.
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<PAGE> 29
"Ownership Interest": As to any Certificate, any ownership
or security interest in such Certificate as the Holder thereof and any other
interest therein, whether direct or indirect, legal or beneficial, as owner or
as pledgee.
"P&I Advance": As to any Mortgage Loan, any advance made by
the Servicer, the Trustee, or the Fiscal Agent pursuant to Section 4.6(b)(iii).
"P&I Certificates": The Class A-1, Class A-2, Class B,
Class C, Class D, Class E, Class F, Class G and Class H Certificates.
"Pass-Through Rate": Any one of the Class A-1, Class A-2,
Class A-EC, Class B, Class C, Class D, Class E, Class F, Class G, Class H or
Class J-2 Pass-Through Rates.
"Paying Agent": The paying agent appointed pursuant to
Section 5.5.
"Percentage Interest": As to any Certificate, the
percentage interest evidenced thereby in distributions required to be made with
respect to the related Class. With respect to any Certificate (except the
Class R and Class LR Certificates), the percentage interest is derived by
dividing the denomination of such Certificate by the initial Certificate
Balance or notional amount of such Class of Certificates. With respect to any
Class R or Class LR Certificate, the percentage interest is set forth on the
face thereof.
"Permitted Investments": Any one or more of the following
obligations or securities payable on demand or having a scheduled maturity on
or before the Business Day preceding the date on which such funds are required
to be drawn, regardless of whether issued by the Depositor, the Servicer, the
Special Servicer, the Trustee or any of their respective Affiliates, and having
at all times the required ratings, if any, provided for in this definition
(provided that no Permitted Investment, if downgraded, shall be required to be
sold at a loss), unless each Rating Agency shall have confirmed in writing to
the Servicer or the Special Servicer, as applicable, that a lower rating will
not result in the withdrawal, downgrading or qualification of the ratings then
assigned to the Certificates:
(i) direct obligations of, or obligations guaranteed as
to full and timely payment of principal and interest
by, the United States or any agency or
instrumentality thereof, provided that such
obligations are backed by the full faith and credit
of the United States of America, including, without
limitation, U.S. Treasury Obligations, Farmers Home
Administration certificates of beneficial interest,
General Services Administration participation
certificates and Small Business Administration
guaranteed participation certificates or guaranteed
pool certificates;
(ii) Federal Housing Administration debentures;
(iii) direct obligations of, or guaranteed as to timely
payment of principal and interest by, FHLMC (debt
obligations only), FNMA (debt obligations only), the
Federal Farm Credit System (consolidated systemwide
bonds
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<PAGE> 30
and notes only), the Federal Home Loan Banks
(consolidated debt obligations only), the Student
Loan Marketing Association, the Financing Corp.
(consolidated debt obligations only), and the
Resolution Funding Corp.;
(iv) Federal funds time deposits in, or uncertificated
certificates of deposit of, or bankers' acceptances,
or repurchase obligations, all having maturities of
not more than 365 days issued by, any bank or trust
company, savings and loan association or savings
bank, depository institution or trust company having
a short term debt obligation rating from S&P of
"A-1+" and that is in the highest short-term rating
category of each Rating Agency unless each of the
Rating Agencies has confirmed in writing that a lower
rating shall not result, in and of itself, in a
downgrading, withdrawal or qualification of the
rating then assigned by such Rating Agency to any
Class of the Certificates;
(v) commercial paper having a maturity of 365 days or
less (including (A) both non-interest-bearing
discount obligations and interest-bearing obligations
payable on demand or on a specified date not more
than one year after the date of issuance thereof and
(B) demand notes that constitute vehicles for
investment in commercial paper) that is rated by each
Rating Agency in its highest short-term unsecured
rating category;
(vi) units of taxable money market funds rated "AAAm" or
"AAAg" by S&P or mutual funds, which funds seek to
maintain a constant asset value and have been rated
by each Rating Agency in its highest rating category
or which have been designated in writing by each
Rating Agency as Permitted Investments with respect
to this definition;
(vii) any other demand, money market or time deposit,
demand obligation or any other obligation, security
or investment, as may be acceptable to each Rating
Agency as a permitted investment of funds backing
securities having ratings equivalent to its initial
rating of the Class A-1, Class A-2 and Class A-EC
Certificates if each of the Rating Agencies has
previously confirmed in writing that the holding of
such demand, money market or time deposit, demand
obligation or any other obligation, security or
investment shall not result, in and of itself, in a
downgrading, withdrawal or qualification of the
rating then assigned by such Rating Agency to any
Class of Certificates; and
(viii) such other obligations confirmed in writing by each
of the Rating Agencies that such obligations are
acceptable as Permitted Investments and the holding
of such obligations by the Servicer or the Special
Servicer, as applicable, shall not result, in and of
itself, in a downgrading, withdrawal or qualification
of the rating then assigned by such Rating Agency to
any Class of Certificates;
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<PAGE> 31
provided, however, that (a) none of such obligations or securities listed above
shall have an "r" highlighter affixed to its rating if rated by S&P; (b) each
such obligation or security shall have a fixed dollar amount of principal due
at maturity which cannot vary or change; (c) if any such obligation or security
provides for a variable rate of interest, interest shall be tied to a single
interest rate index plus a single fixed spread (if any) and move
proportionately with that index; and (d) if any of the obligations or
securities listed in paragraphs (iii) - (ix) above are not rated by Fitch and
by Duff & Phelps, such investment shall be rated by S&P and by Fitch or Duff &
Phelps, as appropriate, and if such obligations or securities are not rated by
Fitch or Duff & Phelps, such investment shall be rated by S&P and one other
nationally recognized statistical rating organization; and provided, further,
however, that such instrument continues to qualify as a "cash flow
investment" pursuant to Code Section 860G(a)(6) earning a passive return in
the nature of interest and that no instrument or security shall be a Permitted
Investment if (i) such instrument or security evidences a right to receive only
interest payments or (ii) the right to receive principal and interest payments
derived from the underlying investment provides a yield to maturity in excess
of 120% of the yield to maturity at par of such underlying investment.
"Permitted Transferee": With respect to a Class R or Class
LR Certificate, any Person or agent thereof that is a Qualified Institutional
Buyer other than (a) a Disqualified Organization, (b) any other Person
designated by the Certificate Registrar based upon an Opinion of Counsel
(provided at the expense of such Person or the Person requesting the Transfer)
to the effect that the Transfer of an Ownership Interest in any Class R or
Class LR Certificate to such Person may cause the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC at any time that the
Certificates are outstanding, or (c) a Person that is a Disqualified Non-U.S.
Person.
"Person": Any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
estate, unincorporated organization or government or any agency or political
subdivision thereof.
"Placement Agent": Prudential Securities Incorporated.
"Plan": As defined in Section 5.2(i).
"Pooled Available Funds": For each Distribution Date, the
sum of all previously undistributed Monthly Payments or other receipts on
account of principal and interest (including Unscheduled Payments and any Net
REO Proceeds transferred from an REO Account to the Collection Account pursuant
to Section 3.17(b)) on or in respect of the Mortgage Loans received by the
Servicer in the Collection Period relating to such Distribution Date, plus all
other amounts received by the Servicer during such Collection Period and
required to be placed in the Collection Account by the Servicer pursuant to
Section 3.5(a) allocable to such Mortgage Loans, and including all P&I Advances
made by the Servicer, the Trustee or the Fiscal Agent in respect of such
Distribution Date and deposits made by the Servicer pursuant to Section 3.25
with respect to such Distribution Date, but excluding the following:
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<PAGE> 32
(a) amounts permitted to be used to reimburse the
Servicer, the Trustee or the Fiscal Agent for
previously unreimbursed Advances and interest thereon
as described in Section 3.6(ii) and (iii);
(b) those portions of each payment of interest which
represent the applicable Servicing Compensation;
(c) all amounts in the nature of late fees, late charges
and similar fees, loan modification fees, extension
fees, loan service transaction fees, demand fees,
beneficiary statement charges, Assumption Fees and
similar fees;
(d) all amounts representing scheduled Monthly Payments
due after the Due Date in the related Collection
Period (such amounts to be treated as received on the
Due Date when due);
(e) that portion of Liquidation Proceeds, Condemnation
Proceeds or Insurance Proceeds with respect to a
Mortgage Loan which represents any unpaid Servicing
Compensation to which the Servicer is entitled;
(f) all amounts representing certain expenses
reimbursable to the Servicer, the Special Servicer,
the Trustee or the Fiscal Agent and other amounts
permitted to be retained by the Servicer or the
Special Servicer or withdrawn by the Servicer from
the Collection Account (including, without
limitation, as provided in Section 3.6) pursuant to
the terms hereof;
(g) with respect to Distribution Dates after the EC
Maturity Date, Prepayment Premiums received in the
related Collection Period;
(h) any interest or investment income on funds on deposit
in the Collection Account or in Permitted Investments
in which such fund may be invested.
"Pooled Principal Distribution Amount": For any
Distribution Date, an amount equal to the sum of:
(i) the principal component of all scheduled Monthly
Payments (other than Balloon Payments) which become
due (regardless of whether received) on the Mortgage
Loans during the related Collection Period;
(ii) to the extent not included elsewhere in this
definition, the principal component of all Assumed
Scheduled Payments, as applicable, deemed to become
due (regardless of whether received) during the
related Collection Period with respect to any
Mortgage Loan that is delinquent in respect of its
Balloon Payment;
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<PAGE> 33
(iii) to the extent not included elsewhere in this
definition, the Scheduled Principal Balance of each
Mortgage Loan that was repurchased from the Trust
Fund in connection with the breach of a
representation or warranty or purchased from the
Trust Fund pursuant to Section 9.1, in either case,
during the related Collection Period;
(iv) to the extent not included elsewhere in this
definition, the portion of Unscheduled Payments
allocable to principal of any Mortgage Loan that was
liquidated during the related Collection Period;
(v) to the extent not included elsewhere in this
definition, the principal component of all Balloon
Payments received during the related Collection
Period;
(vi) to the extent not included elsewhere in this
definition, all other Principal Prepayments received
in the related Collection Period; and
(vii) to the extent not included elsewhere in this
definition, any other full or partial recoveries in
respect of principal, including Insurance Proceeds,
Condemnation Proceeds, Liquidation Proceeds and Net
REO Proceeds.
"Prepayment Assumption": The assumption identified as
"Scenario 2" in Exhibit B to the Private Placement Memorandum dated December
22, 1995, relating to the Privately Placed Certificates and identified as
"Scenario 2" in Exhibit B to the Prospectus Supplement, dated December 22,
1995, relating to the Publicly Offered Certificates.
"Prepayment Interest Shortfall": With respect to any
Distribution Date and any Mortgage Loan as to which a Principal Prepayment was
made by the related Borrower during the related Collection Period, the amount
by which (i) 30 full days of interest at the related Net Mortgage Rate on the
Scheduled Principal Balance of such Mortgage Loan in respect of which interest
would have been due in the absence of such Principal Prepayment on the Due Date
next succeeding the date of such Principal Prepayment exceeds (ii) the amount
of interest received from the related Borrower in respect of such Principal
Prepayment.
"Prepayment Interest Surplus": With respect to any
Distribution Date and any Mortgage Loan as to which a Principal Prepayment was
made by the related Borrower during the related Collection Period, the amount
by which (i) the amount of interest received from the related Borrower in
respect of such Principal Prepayment exceeds (ii) 30 full days of interest at
the related Net Mortgage Rate on the Scheduled Principal Balance of such
Mortgage Loan in respect of which interest would have been due in the absence
of such Principal Prepayment on the Due Date next succeeding the date of such
Principal Prepayment.
"Prepayment Premium": Payments received on a Mortgage Loan
as the result of a Principal Prepayment thereon, not otherwise due thereon in
respect of principal or interest, which are intended to be a disincentive to
prepayment.
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<PAGE> 34
"Principal Prepayment": With respect to any Mortgage Loan,
any payment of principal made by the related Borrower which is received in
advance of its scheduled Due Date and which is not accompanied by an amount of
interest representing the full amount of scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment.
"Prior Pooling and Servicing Agreement": The Amended and
Restated Pooling and Servicing Agreement, dated as of December 1, 1995, by and
among Prudential Securities Secured Financing Corporation, as depositor,
Midland Loan Services, L.P. as servicer, Lennar Partners, Inc., as special
servicer, LaSalle National Bank, as trustee and ABN AMRO Bank, N.V., as fiscal
agent, with respect to the Prudential Securities Secured Financing Corporation,
Commercial Mortgage Pass-Through Certificates, Series 1995- C1.
"Privately Placed Certificates": The Class A-2 Certificates,
the Class A-EC Certificates, the Class B Certificates, the Class F
Certificates, the Class G Certificates, the Class H Certificates, the Class J-1
Certificates, the Class J- 2 Certificates, the Class R Certificates and the
Class LR Certificates.
"Property Advance": As to any Mortgage Loan, any advance
made by the Servicer, the Trustee or the Fiscal Agent in respect of Property
Protection Expenses or any expenses incurred to protect and preserve the
security for such Mortgage Loan or taxes and assessments or insurance premiums,
pursuant to Section 3.4, 3.8 or Section 3.22, as applicable.
"Property Protection Expenses": Any costs and expenses
incurred pursuant to Sections 3.10(c), 3.10(g), 3.10(j), 3.17(b), 3.17(c),
3.18(a) and 3.18(b).
"Publicly Offered Certificates": The Class A-1 Certificates,
the Class C Certificates, the Class D Certificates and the Class E
Certificates.
"Qualified Institutional Buyer": A qualified institutional
buyer within the meaning of Rule 144A.
"Qualified Insurer": An insurance company or security or
bonding company qualified to write the related insurance policy in the relevant
jurisdiction, which (i) except as provided in clauses (ii) or (iii) below,
shall have a claims paying ability of "AA" or better by each Rating Agency
(or, if such company is not rated by Fitch and Duff & Phelps, by S&P and by
Fitch or Duff & Phelps, and if such company is not rated by either Fitch or
Duff & Phelps, by S&P and one other nationally recognized statistical rating
organization), (ii) in the case of public liability insurance policies required
to be maintained with respect to REO Properties in accordance with Section
3.8(a), shall have a claims paying ability of "A" or better by each Rating
Agency (or, if such company is not rated by Fitch or Duff & Phelps, by S&P and
one other nationally recognized statistical rating organization) or (iii) in
the case of the fidelity bond and errors and omissions insurance required to be
maintained pursuant to Section 3.8(c), shall have a claims paying ability rated
by each Rating Agency (or if such company is not rated by Fitch and Duff &
Phelps, by S&P and by Fitch or Duff & Phelps, and if such company is not rated
by either Fitch or Duff & Phelps, by S&P and one other nationally recognized
statistical
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<PAGE> 35
rating organization) no lower than two ratings categories lower than the
highest rating of any outstanding Class of Certificates from time to time, but
in no event lower than "BBB", unless in any such case each of the Rating
Agencies has confirmed in writing that an insurance company with a lower claims
paying ability shall not result, in and of itself, in a downgrading, withdrawal
or qualification of the rating then assigned by such Rating Agency to any Class
of Certificates.
"Qualified Mortgage": A Mortgage Loan that is a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code (but without
regard to the rule in Treasury Regulations 1.860G-2(f)(2) that treats a
defective obligation as a qualified mortgage), or any substantially similar
successor provision.
"Qualified Offeror": A prospective purchaser of the
Mortgage Loans in an auction pursuant to Section 9.1(d) whom the Auction Agent
has reasonably determined possesses the financial ability and is otherwise
qualified to purchase all of the Mortgage Loans.
"Rating Agency": Each of Fitch, Duff & Phelps or S&P.
References herein to the highest long-term unsecured debt rating category of
each Rating Agency shall mean "AAA."
"Real Property": Land or improvements thereon such as
buildings or other inherently permanent structures (including items that are
structural components of such buildings or structures), in each such case as
such terms are used in the REMIC Provisions.
"Realized Loss": With respect to any Distribution Date, the
amount, if any, by which the aggregate of the Certificate Balances of the
Lower-Tier Regular Interests, after giving effect to distributions made on such
Distribution Date, exceeds the aggregate of the Scheduled Principal Balances of
the Mortgage Loans as of the Due Date in the month in which such Distribution
Date occurs.
"Record Date": With respect to each Distribution Date, the
last business day of the month preceding the month in which such Distribution
Date occurs.
"Regular Certificates": The Class A-1, Class A-2, Class
A-EC, Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1
and Class J-2 Certificates.
"Regular Servicing Period": Any Interest Accrual Period
other than a Special Servicing Period.
"Regulation D": Regulation D under the Act.
"Related Certificates" and "Related Lower-Tier Regular
Interest": For any Lower-Tier Regular Interest, the related Certificates set
forth below and for any Certificates, the related Lower-Tier Regular Interest
set forth below:
<TABLE>
<CAPTION>
Related Lower-Tier
Related Certificates Regular Interest
-------------------- ------------------
<S> <C>
</TABLE>
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<PAGE> 36
<TABLE>
<S> <C>
Class A-1 Class A-L-1
Class A-2 Class A-L-2
Class A-EC N/A
Class B Class B-L
Class C Class C-L
Class D Class D-L
Class E Class E-L
Class F Class F-L
Class G Class G-L
Class H Class H-L
Class J-1 Class J-L
Class J-2 N/A
</TABLE>
"REMIC": A "real estate mortgage investment conduit"
within the meaning of Section 860D of the Code.
"REMIC Provisions": Provisions of the federal income tax
law relating to real estate mortgage investment conduits, which appear at
Section 860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations (including any applicable proposed regulations) and
rulings promulgated thereunder, as the foregoing may be in effect from time to
time.
"Remittance Date": The Business Day preceding each
Distribution Date.
"Rents from Real Property": With respect to any REO
Property, gross income of the character described in Section 856(d) of the
Code, which income, subject to the terms and conditions of that Section of the
Code in its present form, does not include:
(i) except as provided in Section 856(d)(4) or (6) of the
Code, any amount received or accrued, directly or
indirectly, with respect to such REO Property, if the
determination of such amount depends in whole or in
part on the income of profits derived by any Person
from such property (unless such amount is a fixed
percentage or percentages of receipts or sales and
otherwise constitutes Rents from Real Property);
(ii) any amount received or accrued, directly or
indirectly, from any Person if the Trust Fund owns
directly or indirectly (including by attribution) a
ten percent or greater interest in such Person
determined in accordance with Sections 856(d)(2)(B)
and (d)(5) of the Code;
(iii) any amount received or accrued, directly or
indirectly, with respect to such REO Property if any
Person Directly Operates such REO Property;
(iv) any amount charged for services that are not
customarily furnished in connection with the rental
of property to tenants in buildings of a similar
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class in the same geographic market as such REO
Property within the meaning of Treasury Regulations
Section 1.856-4(b)(1) (whether or not such charges
are separately stated); and
(v) rent attributable to personal property unless such
personal property is leased under, or in connection
with, the lease of such REO Property and, for any
taxable year of the Trust Fund, such rent is no
greater than 15 percent of the total rent received or
accrued under, or in connection with, the lease.
"REO Account": As defined in Section 3.17(b).
"REO Mortgage Loan": Any Mortgage Loan (other than the
Seaport Participation Interest) as to which the related Mortgaged Property has
become an REO Property.
"REO Proceeds": With respect to any REO Property and the
related REO Mortgage Loan, all revenues received by the Servicer with respect
to such REO Property or REO Mortgage Loan that do not constitute Liquidation
Proceeds.
"REO Property": A Mortgaged Property title to which has
been acquired by the Servicer on behalf of the Trust Fund through foreclosure,
deed in lieu of foreclosure or otherwise.
"Repurchase Price": With respect to any Mortgage Loan to be
repurchased pursuant to Section 2.3(d) or 2.3(e) or any Specially Serviced
Mortgage Loan or any REO Property to be sold or repurchased pursuant to Section
3.18, an amount, calculated by the Servicer, equal to:
(i) the unpaid principal balance of such Mortgage Loan,
Specially Serviced Mortgage Loan or REO Mortgage Loan
related to any REO Property as of the Due Date as to
which a payment was last made by the related Borrower
or was advanced by the Servicer; plus
(ii) unpaid accrued interest from the Due Date as to which
interest was last paid by such Borrower or was
advanced by the Servicer up to the Due Date in the
month following the month in which the purchase or
repurchase occurred at a rate equal to the related
Mortgage Rate on the unpaid principal balance of such
Mortgage Loan, Specially Serviced Mortgage Loan or
REO Mortgage Loan related to any REO Property; plus
(iii) any unreimbursed Advances, together with interest
thereon at the Advance Rate, and unpaid Servicing
Compensation allocable to such Mortgage Loan; and
plus
(iv) in the event that such Mortgage Loan is required to
be repurchased pursuant to Section 2.3(d) or 2.3(e),
expenses reasonably incurred or to
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be incurred by the Servicer or the Trustee in respect
of the breach or defect giving rise to the repurchase
obligation, including any expenses arising out of the
enforcement of the repurchase obligation.
"Request for Release": A request for release signed by a
Servicing Officer, substantially in the form of Exhibit E hereto.
"Reserve Accounts": With respect to any Mortgage Loan,
reserve or escrow accounts, if any, established pursuant to the related
Mortgage Loan Documents and any Escrow Account. Each Reserve Account shall be
an Eligible Account, except with respect to Mortgage Loans No. 95-0903263 and
95-0903264. Any Reserve Account shall be beneficially owned for federal income
tax purposes by the Person who is entitled to receive the reinvestment income
or gain thereon in accordance with the related Mortgage Loan Documents and
Section 3.7.
"Responsible Officer": Any officer or any employee with
responsibilities similar to those of an officer of the Asset-Backed Trust
Services Department of the Trustee (and, in the event that the Trustee is the
Certificate Registrar or the Paying Agent, of the Certificate Registrar or the
Paying Agent, as applicable) assigned to the Corporate Trust Office with direct
responsibility for the administration of this Agreement and also, with respect
to a particular matter, any other officer or any employee with responsibilities
similar to those of an officer of the Asset-Backed Trust Services Department of
the Trustee to whom such matter is referred because of such officer's or
employee's knowledge of and familiarity with the particular subject, and, in
the case of any certification required to be signed by a Responsible Officer,
such an officer or employee whose name and specimen signature appears on a list
of corporate trust officers and employees furnished to the Servicer by the
Trustee, as such list may from time to time be amended.
"Rule 144A": Rule 144A, under the 1933 Act.
"S&P": Standard & Poor's Ratings Services, or its successor
in interest.
"Scheduled Final Distribution Date": November 27, 2015.
"Scheduled Principal Balance": With respect to any Mortgage
Loan, as of any Due Date, the principal balance of such Mortgage Loan as of
such Due Date, after giving effect to (a) any Principal Prepayments,
Non-Premium Prepayments or other unscheduled recoveries of principal and any
Balloon Payments received during the related Collection Period, and (b) any
payment in respect of principal, if any, due on or before such Due Date (other
than a Balloon Payment, but including the principal portion of any Assumed
Scheduled Payment, if applicable), irrespective of any delinquency in payment
by the Borrower. The Scheduled Principal Balance of any REO Mortgage Loan as
of any Due Date is equal to the principal balance thereof outstanding on the
date that the related Mortgaged Property became an REO Property minus any Net
REO Proceeds allocated to principal on such REO Mortgage Loan and reduced by
Monthly Payments due thereon on or before such Due Date. With respect to any
Mortgage Loan, from and after the date on which the Servicer makes a Final
Recovery Determination, the Scheduled Principal Balance thereof shall be zero.
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"Seaport Loan": A mortgage loan originated by Midland L.P.
and identified in the Seaport Participation Agreement.
"Seaport Participation Agreement": The Participation
Agreement, dated as of December 1, 1995, by and between LaSalle National Bank
(in its capacity as trustee under the Prior Pooling and Servicing Agreement),
as seller, and the Mortgage Loan Seller, as participant, substantially in the
form attached hereto as Exhibit I.
"Seaport Participation Certificate": The certificate issued
by the trustee under the Prior Pooling and Servicing Agreement in the name of
the Trustee, evidencing the Seaport Participation Interest.
"Seaport Participation Interest": The 49.3% participation
interest in the Seaport Loan evidenced by the Seaport Participation Certificate.
"Securities Depository": The Depository Trust Company, or
any successor Securities Depository hereafter named. The nominee of the
initial Securities Depository, for purposes of registering those Certificates
that are to be Book-Entry Certificates, is Cede & Co. The Securities
Depository shall at all times be a "clearing corporation" as defined in
Section 8- 102(3) of the Uniform Commercial Code of the State of New York and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934, as amended.
"Securities Depository Participant": A broker, dealer, bank
or other financial institution or other Person for whom from time to time the
Securities Depository effects book-entry transfers and pledges of securities
deposited with the Securities Depository.
"Securities Legend": With respect to each Residual
Certificate and any Individual Certificate (other than a Residual Certificate)
that is a Privately Placed Certificate the legend set forth in, and
substantially in the form of, Exhibit H hereto.
"Senior Principal Distribution Cross-Over Date": The first
Distribution Date as of which the aggregate Certificate Balance of the Class
A-1 Certificates and of the Class A-2 Certificates outstanding immediately
prior thereto exceeds the sum of (a) the aggregate Scheduled Principal Balance
of the Mortgage Loans that will be outstanding immediately following such
Distribution Date and (b) the portion of the Available Distribution Amount for
such Distribution Date that will remain after the distribution of interest has
been made on the Class A-1 and Class A-2 Certificates on such Distribution
Date.
"Seriously Delinquent Loan": With respect to any Remittance
Date, any Mortgage Loan that (i) is 90 days or more delinquent (without regard
to any grace period) or (ii) was 90 days or more delinquent (without regard to
any grace period) and as to which the related Borrower has not made, since the
most recent date on which such Mortgage Loan was so delinquent, 24 consecutive
Monthly Payments.
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"Servicer": Midland Loan Services, L.P., a Missouri limited
partnership, or its successor in interest, or any successor Servicer appointed
as herein provided.
"Servicer Mortgage File": With respect to any Mortgage
Loan, all Mortgage Loan Documents related to such Mortgage Loan that are not
required to be delivered to the Custodian pursuant to Section 2.1 or to be
maintained as part of the Trustee Mortgage File, including without limitation:
(i) a copy of the Management Agreement, if any, for the
related Mortgaged Property;
(ii) a copy of the related ground lease, as amended, if
any, for such Mortgaged Property;
(iii) any and all amendments, modifications and supplements
to, and waivers related to, any of the foregoing;
(iv) copies of the related appraisals, surveys,
environmental reports and other similar documents; and
(v) any other written agreements related to such Mortgage
Loan.
"Servicer Remittance Report": A report prepared by the
Servicer in such media as may be agreed upon by the Servicer and the Trustee
containing such information regarding the Mortgage Loans as will permit the
Trustee to calculate the amounts to be distributed pursuant to Section 4.1 and
to furnish statements to Certificateholders pursuant to Section 4.2 and
containing such additional information as the Servicer and the Trustee may from
time to time agree.
"Servicing Compensation": With respect to each Mortgage
Loan, the Servicing Fee and the Special Servicing Fee which shall be due to the
Servicer and the Special Servicer, as applicable, and such other compensation
of the Servicer and Special Servicer specified in Section 3.12, as adjusted
pursuant to Section 3.25.
"Servicing Fee": With respect to each Mortgage Loan and for
any Distribution Date, an amount per calendar month equal to the product of (i)
one-twelfth of the related Servicing Fee Rate and (ii) the Scheduled Principal
Balance of such Mortgage Loan as of the Due Date in the month preceding the
month in which such Distribution Date occurs.
"Servicing Fee Rate": With respect to Mortgage Loan No.
94-0902784, a rate equal to 0.125% per annum. With respect to Mortgage Loans
No. 94-0903261, 94-0903262, 94-0903263, 94-0903264, 94-0903265, 94-0903276 and
94-0903277, a rate equal to 0.14% per annum. With respect to each other
Mortgage Loan, a rate equal to 0.25% per annum.
"Servicing Officer": Any officer or employee of the
Servicer or the Special Servicer involved in, or responsible for, the
administration and servicing of the Mortgage Loans
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or this Agreement and also, with respect to a particular matter, any other
officer or employee to whom such matter is referred because of such officer's
or employee's knowledge of and familiarity with the particular subject, and, in
the case of any certification required to be signed by a Servicing Officer,
such an officer or employee whose name and specimen signature appears on a list
of servicing officers furnished to the Trustee by the Servicer or the Special
Servicer, as applicable, as such list may from time to time be amended,
together with, in the case of a certificate or other writing executed by an
employee who constitutes a Servicing Officer because of such employee's
knowledge and familiarity with a particular subject, a countersignature of an
officer of the general partner of the Servicer or of an officer of the Special
Servicer, as appropriate.
"Servicing Standard": The standards for the conduct of the
Servicer and the Special Servicer in the performance of their obligations under
this Agreement set forth in Section 3.1(a).
"Similar Law": As defined in Section 5.2(i).
"Special Servicer": Lennar Partners, Inc., a Florida
corporation, or its successor in interest, or any successor Special Servicer
appointed as herein provided.
"Special Servicing Fee": With respect to any Specially
Serviced Mortgage Loan or REO Mortgage Loan and for any Distribution Date, an
amount per calendar month equal to the product of (i) one-twelfth of the
Special Servicing Fee Rate and (ii) the Scheduled Principal Balance of such
Specially Serviced Mortgage Loan or REO Mortgage Loan, as applicable, as of the
Due Date in the month preceding the month in which such Distribution Date
occurs.
"Special Servicing Fee Rate": A rate equal to 0.35% per
annum.
"Special Servicing Period": Any Interest Accrual Period
during which a Mortgage Loan is at any time a Specially Serviced Mortgage Loan.
"Specially Serviced Mortgage Loan": Subject to Section
3.24, any Mortgage Loan (other than the Seaport Participation Interest) with
respect to which:
(i) the related Borrower is 60 or more days delinquent
(without giving effect to any grace period permitted
by the related Note) in the payment of a Monthly
Payment (regardless of whether, in respect thereof,
P&I Advances have been reimbursed);
(ii) such Borrower has expressed to the Servicer an
inability to pay or a hardship in paying such
Mortgage Loan in accordance with its terms;
(iii) the Servicer has received notice that such Borrower
has become the subject of any bankruptcy, insolvency
or similar proceeding, admitted in writing the
inability to pay its debts as they come due or made
an assignment for the benefit of creditors;
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(iv) the Servicer has received notice of a foreclosure or
threatened foreclosure of any lien on the related
Mortgaged Property;
(v) a default of which the Servicer has notice (other
than a failure by such Borrower to pay principal or
interest) and which materially and adversely affects
the interests of the Certificateholders has occurred
and remained unremedied for the applicable grace
period specified in such Mortgage Loan (or, if no
grace period is specified, 60 days); provided,
however, that a default requiring a Property Advance
shall be deemed to materially and adversely affect
the interests of the Certificateholders;
(vi) such Borrower has failed to make a Balloon Payment as
and when due; or
(vii) the Servicer proposes to commence foreclosure or other
workout arrangements;
provided, however, that a Mortgage Loan will cease to
be a Specially Serviced Mortgage Loan:
(a) with respect to the circumstances described
in clause (i) and (vi) above, when the
related Borrower has brought such Mortgage
Loan current (with respect to the
circumstances described in clause (vi),
pursuant to any workout implemented by the
Special Servicer) and thereafter made three
consecutive full and timely Monthly Payments;
(b) with respect to the circumstances described
in clauses (ii) and (iv) above, when such
circumstances cease to exist in the good
faith judgment of the Special Servicer and
with respect to the circumstances described
in clauses (iii) and (vii), when such
circumstances cease to exist; or
(c) with respect to the circumstances described
in clause (v) above, when such default is
cured;
provided, however, that at the time no circumstance identified in clauses (i)
through (vii) above exists that would cause the Mortgage Loan to continue to be
characterized as a Specially Serviced Mortgage Loan.
"Startup Day": The day designated as such pursuant to
Section 2.6(a) hereof.
"Subordinate Certificates": Any one or more of the Class B,
Class C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class J-2,
Class R and Class LR Certificates.
"Tax Returns": The federal income tax return on IRS Form
1066, U.S. Real Estate Mortgage Investment Conduit Income Tax Return, including
Schedule Q thereto,
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Quarterly Notice to Residual Interest Holders of REMIC Taxable Income or Net
Loss Allocation, or any successor forms, to be filed on behalf of each of the
Upper-Tier REMIC and Lower-Tier REMIC under the REMIC Provisions, together with
any and all other information, reports or returns that may be required to be
furnished to the Certificateholders or filed with the IRS or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.
"Termination Date": The Distribution Date on which the
Trust Fund is terminated pursuant to Section 9.1.
"Transfer": Any direct or indirect transfer or other form
of assignment of any Ownership Interest in a Class R or Class LR Certificate.
"Transferee Affidavit": As defined in Section 5.2(j).
"Transferor Letter": As defined in Section 5.2(j).
"Trust Fund": The corpus of the trust created hereby and to
be administered hereunder, consisting of: (i) such Mortgage Loans (other than
the Seaport Participation Interest) as from time to time are subject to this
Agreement, together with the Mortgage Files relating thereto; (ii) the Seaport
Participation Interest, (iii) all payments on or collections in respect of such
Mortgage Loans due after the Cut-off Date; (iv) any REO Property; (v) all
revenues received in respect of REO Property; (vi) the Servicer's, the Special
Servicer's and the Trustee's rights under the insurance policies with respect
to such Mortgage Loans required to be maintained pursuant to this Agreement and
any proceeds thereof; (vii) any Assignments of Leases, Rents and Profits and
any security agreements; (viii) any indemnities or guaranties given as
additional security for such Mortgage Loans; (ix) the Trustee's right, title
and interest in and to the Reserve Accounts; (x) the Collection Account; (xi)
the Distribution Account and the REO Account, including reinvestment income, if
any, thereon; (xii) any environmental indemnity agreements relating to such
Mortgaged Properties; (xiii) the rights and remedies under the Mortgage Loan
Purchase and Sale Agreement; and (xiv) the proceeds of any of the foregoing
(other than any interest earned on deposits in any Reserve Account, to the
extent such interest belongs to the related Borrower).
"Trust REMICs": The Lower-Tier REMIC and the Upper-Tier
REMIC.
"Trustee": LaSalle National Bank, in its capacity as
trustee, or its successor in interest, or any successor trustee appointed as
herein provided.
"Trustee Fee": With respect to each Mortgage Loan and for
any Distribution Date, an amount per calendar month equal to the product of (i)
one-twelfth of the Trustee Fee Rate and (ii) the Scheduled Principal Balance of
such Mortgage Loan as of the Due Date in the month preceding the month in which
such Distribution Date occurs. The Trustee Fee shall be paid by the Servicer
on each Distribution Date.
"Trustee Fee Rate": A rate equal to 0.0125% per annum.
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"Trustee Mortgage File": With respect to any Mortgage Loan,
the mortgage documents listed in Section 2.1(i) through (xii) pertaining to
such Mortgage Loan, the documents listed in the third paragraph of Section 2.1
and any additional documents required to be deposited with the Trustee pursuant
to the express provisions of this Agreement.
"ULLICO": The Union Labor Life Insurance Company, a
Maryland corporation, as the Originator of seven of the Mortgage Loans.
"Uncovered Prepayment Interest Shortfall": For any
Distribution Date, any Prepayment Interest Shortfall not covered by the
Servicing Fee or the Special Servicing Fee pursuant to Section 3.25.
"Underwritten Cash Flow": With respect to any Mortgage Loan,
the cash flow available for debt service on the related Mortgage Loan for a
12-month period, as determined by Midland L.P. in accordance with the standards
of a prudent commercial mortgage lender based upon recent information supplied
by the related Borrower prior to the origination of such Mortgage Loan, and
adjusted, if determined appropriate by Midland L.P., to: (a) deduct any
non-cash items such as depreciation or amortization; (b) deduct capital
expenditures; (c) reflect a more appropriate occupancy rate; (d) reflect
replacement, capital expenditure and other reserves required by the related
Mortgage Loan Documents; (e) reflect a market rate management fee; (f) exclude
certain percentage rent, delinquent rents and non-recurring income; (g) reflect
an allowance for tenant improvements and leasing commissions; and (h) reflect
such other adjustments determined appropriate by Midland L.P.
"Unscheduled Payments": With respect to a Mortgage Loan and
a Collection Period, all Liquidation Proceeds, Condemnation Proceeds and
Insurance Proceeds payable under such Mortgage Loan, the Repurchase Price of
such Mortgage Loan if it is repurchased or purchased pursuant to Sections
2.3(d) or 2.3(e) and the price specified in Section 9.1 if such Mortgage Loan
is purchased or repurchased pursuant thereto, draws on any letters of credit
issued with respect to such Mortgage Loan and any other payments under or with
respect to such Mortgage Loan not scheduled to be made, including Principal
Prepayments (but excluding Prepayment Premiums) received during such Collection
Period.
"Updated Appraisal": As defined in Section 3.10(a).
"Upper-Tier REMIC": A segregated asset pool within the
Trust Fund consisting of the Lower-Tier Regular Interests and amounts held from
time to time in the Distribution Account.
"Voting Right": The portion of the voting rights of all of
the Certificates that is allocated to any Certificate or Class of Certificates.
At all times during the term of this Agreement, the percentage of the Voting
Rights assigned to each Class shall be (a) 0%, in the case of the Class R and
Class LR Certificates, (b) in the case of any of the Class A-1, Class A-2,
Class B, Class C, Class D, Class E, Class F, Class G and Class H Certificates,
a percentage equal to the product of (x) 95% on and prior to the EC Maturity
Date and 97% thereafter and (y) a fraction, the numerator of which is equal to
the aggregate outstanding Certificate Balance
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of such Class of Certificates and the denominator of which is equal to the
aggregate outstanding Certificate Balances of all Classes of Certificates, (c)
in the case of the Class A-EC Certificates, a percentage equal to 2% on and
prior to the EC Maturity Date and 0% thereafter, (d) in the case of the Class
J-1 Certificates, a percentage equal to 1% and (e) in the case of the Class J-2
Certificates, a percentage equal to 2%. The Voting Rights of any Class of
Certificates shall be allocated among Holders of Certificates of such Class in
proportion to their respective Percentage Interests, except that any
Certificate registered in the name of the Depositor, the Servicer, any
Borrower, the Trustee, a Manager or any of their respective Affiliates shall be
deemed not to be outstanding for purposes of giving any consent (unless such
consent is to an action which would materially adversely affect in any material
respect the interests of the Certificateholders of any Class, while the
Servicer or any Affiliate thereof is the holder of Certificates aggregating not
less than 66-2/3% of the Percentage Interest of any such Class). The aggregate
Voting Rights of Holders of more than one Class of Certificates shall be equal
to the sum of the products of each such Holder's Voting Rights and the
percentage of Voting Rights allocated to the related Class of Certificates.
"Weighted Average Net Mortgage Rate": With respect to any
Interest Accrual Period, a per annum rate equal to the weighted average of the
Net Mortgage Rates, as of the related Due Date (weighted on the basis of the
Scheduled Principal Balance of each Mortgage Loan).
"Yield Maintenance Loan": Any Mortgage Loan as to which the
related Note requires the payment of Prepayment Premiums calculated with
reference to a yield maintenance formula.
"Yield Maintenance Period": With respect to each Yield
Maintenance Loan, the period following the origination thereof during which the
related Note requires the payment of Prepayment Premiums calculated with
reference to a yield maintenance formula.
SECTION 1.2. Certain Calculations.
Unless otherwise specified herein, the following provisions
shall apply:
(a) All calculations of interest (including interest on
the Mortgage Loans) provided for herein shall be made on the basis of a 360-day
year consisting of twelve 30-day months.
(b) The portion of any Insurance Proceeds, Condemnation
Proceeds, Liquidation Proceeds or Net REO Proceeds in respect of a Mortgage
Loan allocable to principal and Prepayment Premiums shall equal the total
amount of such proceeds minus (a) first any portion thereof payable to the
Servicer, the Special Servicer, the Trustee or the Fiscal Agent pursuant to the
provisions of this Agreement and (b) second any portion thereof equal to
interest on the unpaid principal balance of such Mortgage Loan at the related
Mortgage Rate less the related Servicing Fee from the Due Date as to which
interest was last paid by the related Borrower up to but not including the Due
Date in the Collection Period in which such proceeds
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are received. Allocation of such amount between principal and Prepayment
Premium shall be made first to principal and second to Prepayment Premium.
(c) Any Mortgage Loan payment is deemed to be received on
the date such payment is actually received by the Servicer, the Special
Servicer or the Trustee; provided, however, that for purposes of calculating
distributions on the Certificates, Principal Prepayments with respect to any
Mortgage Loan are deemed to be received on the date they are applied in
accordance with Section 3.1(b) to reduce the outstanding principal balance of
such Mortgage Loan on which interest accrues.
SECTION 1.3. Certain Constructions.
For purposes of Section 3.10, Section 3.23 and Section 4.6(c),
references to the most or next most subordinate Class of Certificates
outstanding at any time shall mean the most or next most subordinate Class of
Certificates then outstanding as among the Class A-1, Class A-2, Class A-EC,
Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1 and
Class J-2 Certificates (and the Class J-1 and Class J-2 Certificates shall be
considered to be one Class), and references to the next most subordinate Class
of Lower-Tier Regular Interests outstanding at any time shall mean the most or
next most subordinate Class of Lower-Tier Regular Interests then outstanding as
among the Class A-L-1, Class A-L-2, Class B-L, Class C-L, Class D-L, Class E-L,
Class F-L, Class G-L, Class H-L and Class J-L interests, subject in each case
to the rules of construction set forth in the following sentences of this
Section 1.3. Each Class of Certificates, shall be deemed to be outstanding only
to the extent its respective Certificate Balance has not been reduced to zero
or, with respect to the Class A-EC Certificates, to the extent that the EC
Maturity Date has not occurred or with respect to the Class J-2 Certificates,
to the extent the Class J-2 Notional Balance has not been reduced to zero.
Unless the context clearly indicates otherwise, references to
section numbers are to sections of this Agreement.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.1. Conveyance and Assignment of Mortgage Loans;.
The Depositor, concurrently with the execution and delivery
hereof, does hereby sell, transfer, assign, set over and otherwise convey to
the Trustee without recourse (except to the extent herein provided) all the
right, title and interest of the Depositor in and to the Mortgage Loans,
including all rights to payment in respect thereof, except as set forth below,
and any security interest thereunder (whether in real or personal property and
whether tangible or intangible) in favor of the Depositor, and all Reserve
Accounts and all other assets included or to be included in the Trust Fund for
the benefit of the Certificateholders. Such transfer and assignment includes
all scheduled payments of interest and principal due after the Cut-off Date
(whether or not received) and all payments of interest and principal received
by the Depositor or the Servicer on or with respect to the Mortgage Loans after
the Cut-off Date. In connection with such transfer and assignment of all
interest and principal due with respect to the Mortgage Loans after the Cut-off
Date, the Depositor shall make a cash deposit to the Collection Account on the
Closing Date in an amount equal to the Cash Deposit. The Depositor,
concurrently with the execution and delivery hereof, does also hereby sell,
transfer, assign, set over and otherwise convey to the Trustee without recourse
(except to the extent provided herein) all the right, title and interest of the
Depositor in, to and under the Mortgage Loan Purchase and Sale Agreement (other
than its rights to indemnification pursuant to Section 4 thereof and rights to
recovery of costs under Section 7 thereof). The Depositor shall cause the
Reserve Accounts to be transferred to and held in the name of the Servicer on
behalf of the Trustee as successor to the Mortgage Loan Seller and Midland L.P.
In connection with the transfer and assignment of Mortgage
Loans other than the Seaport Participation Interest, the Depositor does hereby
deliver to, and deposit with, the Trustee, with a copy to the Servicer, the
following documents or instruments with respect to each Mortgage Loan so
assigned:
(i) the original of the related Note, endorsed by the
Mortgage Loan Seller (or in the case of the seven
Mortgage Loans originated by ULLICO, by ULLICO) in
blank in the following form: "Pay to the order of
________________, without recourse" which the
Trustee or its designee is authorized to complete and
which Note and all endorsements thereof shall show a
complete chain of endorsement from the Originator to
the Mortgage Loan Seller;
(ii) the related original recorded Mortgage or a copy
thereof certified by the related title insurance
company, public recording office or closing agent to
be in the form in which executed or submitted for
recording, the related original recorded Assignment
of Mortgage from Midland L.P. to the Mortgage Loan
Seller or a copy thereof certified by the related
title
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insurance company, public recording office or closing
agent to be in the form in which executed or
submitted for recording and the related original
Assignment of Mortgage executed by the Mortgage Loan
Seller in blank which the Trustee or its designee is
authorized to complete (and but for the insertion of
the name of the assignee and any related recording
information which is not yet available to the
Mortgage Loan Seller, is in suitable form for
recordation in the jurisdiction in which the related
Mortgaged Property is located); provided, that with
respect to each of the seven Mortgage Loans
originated by ULLICO, there will be the related
original Assignment of Mortgage executed by ULLICO in
blank which the Trustee or its designee is authorized
to complete (and but for the insertion of the name of
the assignee and any related recording information
which is not yet available to the Mortgage Loan
Seller, is in suitable form for recordation in the
jurisdiction in which the related Mortgaged Property
is located);
(iii) if the related security agreement is separate from
the Mortgage, the original security agreement or a
counterpart thereof, and if the security agreement is
not assigned under the Assignments of Mortgage
described in clause (ii) above, the related original
assignment of such security agreement from Midland
L.P. to the Mortgage Loan Seller or a counterpart
thereof and the related original assignment of such
security agreement executed by the Mortgage Loan
Seller in blank which the Trustee or its designee is
authorized to complete;
(iv) a copy of each Form UCC-1 financing statement, if
any, filed with respect to personal property
constituting a part of the related Mortgaged
Property, together with a copy of each Form UCC-2 or
UCC-3 assignment, if any, of such financing statement
to the Mortgage Loan Seller from Midland L.P. and a
copy of each Form UCC-2 or UCC-3 assignment, if any,
of such financing statement executed by the Mortgage
Loan Seller in blank which the Trustee or its
designee is authorized to complete (and but for the
insertion of the name of the assignee and any related
filing information which is not yet available to the
Mortgage Loan Seller, is in suitable form for filing
in the filing office in which such financing
statement was filed); provided, that with respect to
each of the seven Mortgage Loans originated by
ULLICO, there will be a copy of each Form UCC-2 or
UCC-3 Assignment, if any, of such financing statement
executed by ULLICO in blank which the Trustee or its
designee is authorized to complete (and but for the
insertion of the name of assignee and any related
filing information which is not yet available to the
Mortgage Loan Seller, is in suitable form for filing
in the filing office in which such financing
statement was filed);
(v) the related original of the Loan Agreement, if any,
relating to such Mortgage Loan or a counterpart
thereof;
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(vi) the related original lender's title insurance policy
(or the original pro forma title insurance policy),
together with any endorsements thereto;
(vii) if any related Assignment of Leases, Rents and
Profits is separate from the Mortgage, the original
recorded Assignment of Leases, Rents and Profits or a
copy thereof certified by the related title insurance
company, public recording office or closing agent to
be in the form in which executed or submitted for
recording, the related original recorded reassignment
of such instrument, if any, from Midland L.P. to the
Mortgage Loan Seller or a copy thereof certified by
the related title insurance company, public recording
office or closing agent to be in the form in which
executed or submitted for recording and the related
original reassignment of such instrument, if any,
executed by the Mortgage Loan Seller in blank which
the Trustee or its designee is authorized to complete
(and but for the insertion of the name of the
assignee and any related recording information which
is not yet available to the Mortgage Loan Seller, is
in suitable form for recordation in the jurisdiction
in which the related Mortgaged Property is located)
(any of which reassignments, however, may be included
in a related Assignment of Mortgage and need not be a
separate instrument);
(viii) copies of the original Environmental Reports with
respect to the Mortgaged Property made in connection
with origination of such Mortgage Loan;
(ix) if any related assignment of contracts is separate
from the Mortgage, the original assignment of
contracts or a counterpart thereof, and if the
assignment of contracts is not assigned under the
Assignments of Mortgage described in clause (ii)
above, the related original reassignment of such
instrument from Midland L.P. to the Mortgage Loan
Seller or a counterpart thereof and the related
original reassignment of such instrument executed by
the Mortgage Loan Seller in blank which the Trustee
or its designee is authorized to complete;
(x) with respect to the related Reserve Accounts, if any,
a copy of the original of any separate agreement with
respect thereto between the related Borrower and the
Originator;
(xi) the original letter of credit, if any, with respect
thereto, together with any and all amendments
thereto, including, without limitation, any amendment
which entitles the Servicer to draw upon such letter
of credit on behalf of the Trustee for the benefit of
the Certificateholders, and the original of each
instrument or other item of personal property given
as security for a Mortgage Loan possession of which
by a secured party is necessary to a secured party's
valid, perfected, first priority security interest
therein, together with all assignments or
endorsements thereof necessary to entitle
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the Servicer to enforce a valid, perfected, first
priority security interest therein on behalf of the
Trustee for the benefit of the Certificateholders;
(xii) with respect to the related Reserve Accounts, if any,
a copy of the UCC-1 financing statements, if any,
submitted for filing with respect to the Mortgage
Loan Seller's security interest in such Reserve
Accounts and all funds contained therein, together
with a copy of each Form UCC-2 or UCC-3 assignment,
if any, of such financing statement to the Mortgage
Loan Seller from Midland L.P. and a copy of each Form
UCC-2 or UCC-3 assignment, if any, of such financing
statement executed by the Mortgage Loan Seller in
blank which the Trustee or its designee is authorized
to complete (and but for the insertion of the name of
the assignee and any related filing information which
is not yet available to the Mortgage Loan Seller is
in suitable form for filing in the filing office in
which such financing statement was filed); provided,
that with respect to any Mortgage Loan originated by
ULLICO, there will be a copy of each Form UCC-2 or
UCC-3 Assignment, if any, of such financing statement
executed by ULLICO in blank which the Trustee or its
designee is authorized to complete (and but for the
insertion of the name of the assignee and any related
filing information which is not yet available to the
Mortgage Loan Seller, is in suitable form for filing
in the filing office in which such financing
statement was filed); and
(xiii) copies of any and all amendments, modifications and
supplements to, and waivers related to, any of the
foregoing.
In connection with the transfer and assignment of the Seaport
Participation Interest, the Depositor does hereby deliver to the Trustee, with
a copy to the Servicer, with respect to the Seaport Participation Interest, (i)
the Seaport Participation Certificate, (ii) a copy of the Seaport Participation
Agreement and (iii) copies of all releases of security interests relating to
the Seaport Participation Interest, such that the Trustee shall hold good and
valid title to the Seaport Participation Interest, free and clear of any and
all liens, encumbrances, pledges, charges or security interests of any nature.
On or promptly following the Closing Date, the Trustee or
Custodian, as applicable, shall, to the extent possession thereof has been
delivered to it, complete any Assignment of Mortgage delivered pursuant to
clause (ii) above, any assignment of security agreement delivered pursuant to
clause (iii) above, any Form UCC-2 or UCC-3 assignment delivered pursuant to
clause (iv) and (xii) above, any reassignment of Assignment of Leases, Rents
and Profits delivered pursuant to clause (vii) above and any reassignment of
assignment of contracts delivered pursuant to clause (ix) above, in each case,
by inserting the name of the Trustee as assignee and delivering to the Servicer
(1) for recordation, (a) each Assignment of Mortgage referred to in Section
2.1(ii) which has not yet been submitted for recordation and (b) each
reassignment of Assignment of Leases, Rents and Profits referred to in Section
2.1(vii) (if not otherwise included in the related Assignment of Mortgage)
which has not yet been submitted for recordation; and (2) for filing, each
UCC-2 or UCC-3 financing statement assignment
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referred to in Section 2.1(iv) and (xii) which has not yet been submitted for
filing. On or promptly following the Closing Date, the Trustee or Custodian,
as applicable, shall, to the extent possession thereof has been delivered to
it, complete the endorsement of the Note by inserting the name of the Trustee
as endorsee. The Servicer shall, upon delivery, promptly submit for recording
or filing, as the case may be, in the appropriate public recording or filing
office, each such document. In the event that any such document is lost or
returned unrecorded because of a defect therein, the Servicer shall use its
best efforts to promptly prepare a substitute document for signature by the
Depositor, Mortgage Loan Seller or ULLICO, as applicable, and thereafter the
Servicer shall cause each such document to be duly recorded. The Servicer
shall, promptly upon receipt of the original of each such recorded document
(and in no event later than five Business Days following such receipt), deliver
such original to the Custodian. Notwithstanding anything to the contrary
contained in this Section 2.1, in those instances where the public recording
office retains the original Assignment of Mortgage or reassignment of
Assignment of Leases, Rents and Profits, if applicable, after any such document
has been recorded, the obligations hereunder of the Depositor shall be deemed
to have been satisfied upon delivery to the Custodian of a copy of such
Assignment of Mortgage or reassignment of Assignment of Leases, Rents and
Profits, if applicable, certified by the public recording office to be a true
and complete copy of the recorded original thereof. If a pro forma title
insurance policy has been delivered to the Custodian in lieu of an original
title insurance policy, the Depositor or the Servicer will promptly deliver to
the Custodian the related original title insurance policy upon receipt thereof.
The Depositor or the Servicer shall promptly cause the UCC-1s, UCC-2s and
UCC-3s referred to in Section 2.1(iv) and (xii) to be filed in the applicable
public recording or filing office and upon filing will promptly deliver to the
Custodian the related UCC-1, UCC-2 or UCC-3 with evidence of filing thereon.
All original documents relating to the Mortgage Loans which
are not delivered to the Custodian are and shall be held by the Trustee or the
Servicer, as the case may be, in trust for the benefit of the
Certificateholders. In the event that any such original document is required
pursuant to the terms of this Section to be a part of a Trustee Mortgage File,
such document shall be delivered promptly to the Custodian.
If the Depositor cannot deliver any original or certified
recorded document described in Section 2.1 on the Closing Date, the Depositor
shall use its best efforts, promptly upon receipt thereof and in any case not
later than 45 days from the Closing Date, to deliver or cause to be delivered
such original or certified recorded documents to the Custodian (unless the
Depositor is delayed in making such delivery by reason of the fact that such
documents shall not have been returned by the appropriate recording office, in
which case the Depositor or the Servicer shall notify the Custodian and the
Trustee in writing of such delay and shall deliver such documents to the
Custodian promptly upon the Depositor's or the Servicer's receipt thereof).
SECTION 2.2. Acceptance by the Custodian and the Trustee.
By its execution and delivery of this Agreement, the Trustee
acknowledges the assignment to it of the Mortgage Loans in good faith without
notice of adverse claims and declares that the Custodian holds and will hold
such documents and all others delivered to it
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constituting the Trustee Mortgage File (to the extent the documents
constituting the Trustee Mortgage File are actually delivered to the Custodian)
for any Mortgage Loan assigned to the Trustee hereunder in trust, upon the
conditions herein set forth, for the use and benefit of all present and future
Certificateholders. The Trustee agrees to review each Trustee Mortgage File
within 45 days after the later of (a) the Trustee's receipt of such Trustee
Mortgage File or (b) execution and delivery of this Agreement, to ascertain
that all documents referred to in Section 2.1 above (as identified to it in
writing by the Depositor or the Servicer) and any original recorded documents
referred to in the last sentence of Section 2.1 to be included in the delivery
of a Trustee Mortgage File, have been received, have been executed, appear on
their face to be what they purport to be, purport to be recorded or filed (as
applicable) and have not been torn, mutilated or otherwise defaced, and that
such documents relate to the Mortgage Loans identified in the Mortgage Loan
Schedule. In so doing, the Trustee may rely on the purported due execution and
genuineness of any such document and on the purported genuineness of any
signature thereon. If, at the conclusion of such review, any document or
documents constituting a part of a Trustee Mortgage File have not been executed
or received, have not been recorded or filed (if required), are unrelated to
the Mortgage Loans identified in the Mortgage Loan Schedule, appear on their
face not to be what they purport to be or have been torn, mutilated or
otherwise defaced, the Trustee shall promptly so notify the Depositor and the
Mortgage Loan Seller by providing a written report, setting forth, for each
affected Mortgage Loan, with particularity, the nature of the defective or
missing document. Neither the Servicer nor the Trustee shall be responsible
for any loss, cost, damage or expense to the Trust Fund resulting from any
failure to receive any document constituting a portion of a Trustee Mortgage
File noted on such a report or for any failure by the Depositor to use its best
efforts to deliver any such document.
In reviewing any Trustee Mortgage File pursuant to the
preceding paragraph or Section 2.1, the Trustee will have no responsibility to
determine whether any document or opinion is legal, valid, binding or
enforceable, whether the text of any assignment or endorsement is in proper or
recordable form (except, if applicable, to determine whether the Trustee is the
assignee or endorsee), whether any document has been recorded in accordance
with the requirements of any applicable jurisdiction, whether a blanket
assignment is permitted in any applicable jurisdiction, or whether any Person
executing any document or rendering any opinion is authorized to do so or
whether any signature thereon is genuine.
The Trustee shall hold that portion of the Trust Fund
delivered to the Trustee consisting of "instruments" (as such term is defined
in Section 9-105(i) of the Uniform Commercial Code as in effect in Illinois on
the date hereof) in Illinois and, except as set forth in Section 3.11 or as
otherwise specifically provided in this Agreement, shall not remove such
instruments from Illinois unless it receives an Opinion of Counsel (obtained
and delivered at the expense of the Person requesting the removal of such
instruments from Illinois) that in the event the transfer of the Mortgage Loans
to the Trustee is deemed not to be a sale, after such removal, the Trustee will
possess a first priority perfected security interest in such instruments.
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SECTION 2.3. Representations and Warranties of the
Depositor.
(a) The Depositor hereby represents and warrants that:
(i) The Depositor is a corporation duly organized validly
existing and in good standing under the laws of the
State of Delaware;
(ii) The Depositor has taken all necessary action to
authorize the execution, delivery and performance of
this Agreement by it, and has the power and authority
to execute, deliver and perform this Agreement and
all the transactions contemplated hereby, including,
but not limited to, the power and authority to sell,
assign and transfer the Mortgage Loans in accordance
with this Agreement;
(iii) This Agreement has been duly and validly authorized,
executed and delivered by the Depositor and assuming
the due authorization, execution and delivery of this
Agreement by each other party hereto, this Agreement
and all of the obligations of the Depositor hereunder
are the legal, valid and binding obligations of the
Depositor, enforceable in accordance with the terms
of this Agreement, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization,
liquidation, receivership, moratorium or other laws
relating to or affecting creditors' rights generally,
or by general principles of equity (regardless of
whether such enforceability is considered in a
proceeding in equity or at law);
(iv) The execution and delivery of this Agreement and the
performance of its obligations hereunder by the
Depositor will not conflict with any provision of its
certificate of incorporation or bylaws, or any law or
regulation to which the Depositor is subject, or
conflict with, result in a breach of or constitute a
default under (or an event which, with notice or
lapse of time or both, would constitute a default
under) any of the terms, conditions or provisions of
any agreement or instrument to which the Depositor is
a party or by which it is bound, or any order or
decree applicable to the Depositor, or result in the
creation or imposition of any lien on any of the
Depositor's assets or property which would materially
and adversely affect the ability of the Depositor to
carry out the transactions contemplated by this
Agreement. The Depositor has obtained any consent,
approval, authorization or order of any court or
governmental agency or body required for the
execution, delivery and performance by the Depositor
of this Agreement;
(v) The certificate of incorporation of the Depositor
provides that the Depositor is permitted to engage in
only the following activities:
(A) to acquire, own, hold, sell, transfer,
assign, pledge, finance, refinance and
otherwise deal with (I) loans secured by
first or
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second mortgages, deeds of trust or similar
liens on residential, commercial or mixed
commercial and residential properties or
shares issued by private non-profit housing
corporations, (II) any participation interest
in or security based on or backed by any of
the foregoing (the loans described in clause
(A)(I) and the participation interests
described in clause (A)(II), collectively,
"mortgage loans"), or (III) various
receivables including, but not limited to,
retail automotive installment sale contracts
or loans or automotive leases, consumer or
commercial loans or leases, credit card
accounts, mobile home loans or insurance
policy loans ("receivables");
(B) to authorize and issue one or more series
(each, a "series") of pass-through
securities ("certificates") pursuant to
pooling and servicing agreements (each, a
"pooling and servicing agreement"), each of
which series (I) represents ownership
interests in mortgage loans or receivables,
related property and/or collections in
respect thereof, and (II) may be structured
to contain one or more classes or
certificates, each class having the
characteristics specified in the related
pooling and servicing agreement, and to
acquire, own, hold, sell, transfer, assign,
pledge, finance or refinance one or more
certificates or classes of certificates of
any series; and
(C) to engage in any acts and activities and
exercise any powers permitted to corporations
under the laws of the State of Delaware which
are incidental to, or connected with, the
foregoing, and necessary, suitable or
convenient to accomplish any of the
foregoing;
(vi) There is no action, suit or proceeding pending
against the Depositor in any court or by or before
any other governmental agency or instrumentality
which would materially and adversely affect the
ability of the Depositor to carry out its obligations
under this Agreement; and
(vii) The Trustee, if not the owner of the Mortgage Loans,
will have a valid and perfected security interest of
first priority in each of the Mortgage Loans and any
proceeds thereof.
(b) The Depositor hereby represents and warrants with
respect to each Mortgage Loan that:
(i) Immediately prior to the transfer and assignment to
the Trustee, the related Note and the related
Mortgage and the Seaport Participation Certificate
were not subject to an assignment or pledge, and the
Depositor had good title to, and was the sole owner
of, such Mortgage Loan and had
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full right to transfer and sell such Mortgage Loan to
the Trustee free and clear of any encumbrance, lien,
pledge, charge, claim or security interest;
(ii) The Depositor 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 ;
(iii) The related Assignment of Mortgage constitutes the
legal, valid and binding assignment of the related
Mortgage from the Depositor to the Trustee, and any
related reassignment of Assignment of Leases, Rents
and Profits constitutes the legal, valid and binding
assignment of any related Assignment of Leases, Rents
and Profits from the Depositor to the Trustee;
(iv) No claims have been made by the Depositor under the
related lender's title insurance policy, and the
Depositor has not done, by act or omission, anything
which would impair the coverage of such lender's
title insurance policy; and
(v) To the best of the Depositor's knowledge, all of the
representations and warranties of Midland L.P. or the
Mortgage Loan Seller, as applicable, contained in the
Mortgage Loan Purchase and Sale Agreement are true
and correct as of the date made.
(c) It is understood and agreed that the representations
and warranties set forth in this Section 2.3 shall survive delivery of the
respective Trustee Mortgage Files to the Trustee until the termination of this
Agreement, and shall inure to the benefit of the Certificateholders, the
Servicer and the Special Servicer.
(d) Upon discovery by the Custodian, the Servicer, the
Special Servicer or the Trustee of a breach of the representation and warranty
set forth in Section 2(c)(xli) of the Mortgage Loan Purchase and Sale Agreement
or that any Mortgage Loan otherwise fails to constitute a Qualified Mortgage,
such Person shall give prompt notice thereof to the Mortgage Loan Seller and
Midland L.P., and the Mortgage Loan Seller or Midland L.P., as applicable,
shall correct such condition or repurchase such Mortgage Loan at the Repurchase
Price within 85 days of discovery of such failure; it being understood and
agreed that none of such Persons has an obligation to conduct any investigation
with respect to such matters.
(e) Upon discovery by the Custodian, the Servicer, the
Special Servicer or the Trustee of a breach of any representation or warranty
of the Mortgage Loan Seller or Midland L.P. in the Mortgage Loan Purchase and
Sale Agreement (other than the representation set forth in Section 2(c)(xli)
thereof, but including without limitation the representation as to
Loan-to-Value Ratio and Debt Service Coverage Ratio set forth in Section
2(c)xxiii thereof), with respect to any Mortgage Loan, or that any document
required to be included in the Trustee Mortgage File with respect to a Mortgage
Loan does not conform to the requirements of Section 2.1, such Person shall
give prompt notice thereof to the Mortgage Loan Seller and Midland
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L.P., and the Mortgage Loan Seller or Midland L.P., as applicable, shall, to
the extent the Mortgage Loan Seller or Midland L.P. is obligated to cure such
breach or repurchase the related Mortgage Loan under the terms of the Mortgage
Loan Purchase and Sale Agreement, either cure such breach or repurchase such
Mortgage Loan at the Repurchase Price within 85 days of the receipt of notice
of such breach, as the same may be extended, all pursuant to and as more
particularly described in the Mortgage Loan Purchase and Sale Agreement; it
being understood and agreed that none of the Custodian, the Servicer, the
Special Servicer and the Trustee has an obligation to conduct any investigation
with respect to such matters (except, in the case of the Trustee Mortgage
Files, to the extent provided in Sections 2.1 and 2.2).
(f) Upon receipt by the Servicer from the Depositor,
Midland L.P. or the Mortgage Loan Seller of the Repurchase Price for a
repurchased Mortgage Loan, the Servicer shall deposit such amount in the
Collection Account, and the Trustee, pursuant to Section 3.11, shall, upon
receipt of a certificate of a Servicing Officer certifying as to the receipt by
the Servicer of the Repurchase Price and the deposit of the Repurchase Price
into the Collection Account pursuant to this Section 2.3(f), release or cause
to be released to the Depositor, Midland L.P. or the Mortgage Loan Seller, as
applicable, the related Trustee Mortgage File and shall execute and deliver
such instruments of transfer or assignment, in each case without recourse,
representation or warranty, as shall be prepared by the Servicer to vest in the
Depositor, Midland L.P. or the Mortgage Loan Seller, as applicable, any
Mortgage Loan released pursuant hereto, and any rights of the Depositor in, to
and under the Mortgage Loan Purchase and Sale Agreement as it related to such
Mortgage Loan that were initially transferred to the Trust Fund under Section
2.1, and the Trustee and the Servicer shall have no further responsibility with
regard to such Trustee Mortgage File or the related Mortgage Loan.
(g) In the event that the Mortgage Loan Seller incurs any
expense in connection with curing a breach of a representation or warranty
pursuant to Section 2.3(d) and (e) which also constitutes a default under the
related Mortgage Loan, the Mortgage Loan Seller shall have a right, and the
Mortgage Loan Seller shall be subrogated to the rights of the Trustee, as
successor to the mortgagee, to recover the amount of such expenses from the
related Borrower. The Servicer shall use reasonable efforts in recovering, or
assisting the Mortgage Loan Seller in recovering, from such Borrower the amount
of any such expenses.
(h) In the event that any litigation is commenced which
alleges facts which, in the judgment of the Depositor, could constitute a
breach of any of the Depositor's representations and warranties relating to the
Mortgage Loans, the Depositor hereby reserves the right to conduct the defense
of such litigation at its expense.
(i) The Servicer shall use its best efforts, in
accordance with the Servicing Standard, to enforce the obligations of the
Mortgage Loan Seller and Midland L.P. to cure or repurchase any Mortgage Loan
which is discovered to be a "Defective Mortgage Loan" (as such term is
defined in the Mortgage Loan Purchase and Sale Agreement) under the terms of
the Mortgage Loan Purchase and Sale Agreement.
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SECTION 2.4. Representations, Warranties and Covenants of
the Servicer and the Special Servicer.
(a) The Servicer hereby represents, warrants and
covenants that as of the Closing Date, or as of such date specifically provided
herein:
(i) The Servicer is a limited partnership, duly
organized, validly existing and in good standing
under the laws of the State of Missouri and has all
licenses necessary to carry on its business as now
being conducted or is in compliance with the laws of
each state in which any Mortgaged Property is located
to the extent necessary to ensure the enforceability
of each Mortgage Loan in accordance with the terms of
this Agreement;
(ii) The Servicer has the full partnership power,
authority and legal right to execute and deliver this
Agreement and to perform in accordance herewith; the
execution and delivery of this Agreement by the
Servicer and its performance and compliance with the
terms of this Agreement do not violate the Servicer's
certificate of limited partnership or constitute a
default (or an event which, with notice or lapse of
time, or both, would constitute a default) under, or
result in the breach of, any material contract,
agreement or other instrument to which the Servicer
is a party or which may be applicable to the Servicer
or any of its assets, which default or breach would
have consequences that would materially and adversely
affect the financial condition or operations of the
Servicer or its properties taken as a whole or impair
the ability of the Trust Fund to realize on the
Mortgage Loans;
(iii) This Agreement has been duly and validly authorized,
executed and delivered by the Servicer and, assuming
due authorization, execution and delivery by the
other parties hereto, constitutes a legal, valid and
binding obligation of the Servicer, enforceable
against it in accordance with the terms of this
Agreement, except as such enforcement may be limited
by bankruptcy, insolvency, reorganization,
liquidation, receivership, moratorium or other laws
relating to or affecting creditors' rights generally,
or by general principles of equity (regardless of
whether such enforceability is considered in a
proceeding in equity or at law);
(iv) The Servicer is not in violation of, and the
execution and delivery of this Agreement by the
Servicer and its performance and compliance with the
terms of this Agreement will not constitute a
violation with respect to, any order or decree of any
court or any order or regulation of any federal,
state, municipal or governmental agency having
jurisdiction, or result in the creation or imposition
of any lien, charge or encumbrance which, in any such
event, would have consequences that would materially
and adversely affect the financial condition or
operations of the Servicer or its
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properties taken as a whole or impair the ability of
the Trust Fund to realize on the Mortgage Loans;
(v) There is no action, suit or proceeding pending or, to
the knowledge of the Servicer, threatened, against
the Servicer which, either in any one instance or in
the aggregate, would result in any material adverse
change in the business, operations or financial
condition of the Servicer or would, if adversely
determined, materially impair the ability of the
Servicer to perform under the terms of this Agreement
or which would draw into question the validity of
this Agreement or the Mortgage Loans or of any action
taken or to be taken in connection with the
obligations of the Servicer contemplated herein;
(vi) No consent, approval, authorization or order of, or
registration or filing with, or notice to any court
or governmental agency or body is required for the
execution, delivery and performance by the Servicer
of, or compliance by the Servicer with, this
Agreement or, if required, such approval has been
obtained prior to the Cut-off Date, except to the
extent that the failure of the Servicer to be
qualified as a foreign limited partnership or
licensed in one or more states is not necessary for
the enforcement of the Mortgage Loans; and
(vii) The Servicer is maintaining a fidelity bond and
errors and omissions coverage in accordance with the
requirements of Section 3.8(c) hereof.
(b) The Special Servicer hereby represents, warrants and
covenants that as of the Closing Date, or as of such date specifically provided
herein:
(i) The Special Servicer is a corporation, duly
organized, validly existing and in good standing
under the laws of the State of Florida and has all
licenses necessary to carry on its business as now
being conducted or is in compliance with the laws of
each state in which any Mortgaged Property is located
to the extent necessary to ensure the enforceability
of each Specially Serviced Mortgage Loan in
accordance with the terms of this Agreement;
(ii) The Special Servicer has the full corporate power,
authority and legal right to execute and deliver this
Agreement and to perform in accordance herewith; the
execution and delivery of this Agreement by the
Special Servicer and its performance and compliance
with the terms of this Agreement do not violate the
Special Servicer's certificate of incorporation or
constitute a default (or an event which, with notice
or lapse of time, or both, would constitute a
default) under, or result in the breach of, any
material contract, agreement or other instrument to
which the Special Servicer is a party or which may be
applicable to the Special Servicer or any of its
assets, which default or breach would have
consequences that
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would materially and adversely affect the condition
(financial or otherwise) or operations of the Special
Servicer or its properties, taken as a whole, or
impair the ability of the Trust Fund to realize on
the Specially Serviced Mortgage Loans;
(iii) This Agreement has been duly and validly authorized,
executed and delivered by the Special Servicer and,
assuming due authorization, execution and delivery by
the other parties hereto, constitutes a legal, valid
and binding obligation of the Special Servicer,
enforceable against it in accordance with the terms
of this Agreement, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization,
liquidation, receivership, moratorium or other laws
relating to or affecting creditors' rights generally,
or by general principles of equity (regardless of
whether such enforceability is considered in a
proceeding in equity or at law);
(iv) The Special Servicer is not in violation of, and the
execution and delivery of this Agreement by the
Special Servicer and its performance and compliance
with the terms of this Agreement will not constitute
a violation with respect to, any order or decree of
any court or any order or regulation of any federal,
state, municipal or governmental agency having
jurisdiction, or result in the creation or imposition
of any lien, charge or encumbrance which, in any such
event, would have consequences that would materially
and adversely affect the condition (financial or
otherwise) or operations of the Special Servicer or
its properties taken as a whole or impair the ability
of the Trust Fund to realize on the Specially
Serviced Mortgage Loans;
(v) There is no action, suit or proceeding pending or, to
the knowledge of the Special Servicer, threatened,
against the Special Servicer which, either in any one
instance or in the aggregate, would result in any
material adverse change in the business, operations
or financial condition of the Special Servicer or
would, if adversely determined, materially impair the
ability of the Special Servicer to perform under the
terms of this Agreement or which would draw into
question the validity of this Agreement or the
Specially Serviced Mortgage Loans or of any action
taken or to be taken in connection with the
obligations of the Special Servicer contemplated
herein;
(vi) No consent, approval, authorization or order of, or
registration or filing with, or notice to any court
or governmental agency or body is required for the
execution, delivery and performance by the Special
Servicer of, or compliance by the Special Servicer
with, this Agreement or, if required, such approval
has been obtained prior to the Cut-off Date, except
to the extent that the failure of the Special
Servicer to be qualified as a foreign
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limited partnership or licensed in one or more states
is not necessary for the enforcement of the Specially
Serviced Mortgage Loans; and
(vii) The Special Servicer is maintaining a fidelity bond
and errors and omissions coverage in accordance with
the requirements of Section 3.8(c) hereof.
(c) It is understood and agreed that the representations
and warranties set forth in this Section shall survive delivery of the Trustee
Mortgage Files to the Trustee or the Custodian on behalf of the Trustee until
the termination of this Agreement, and shall inure to the benefit of the
Trustee and the Depositor. Upon discovery by the Depositor, the Servicer, the
Special Servicer or a Responsible Officer of the Trustee (or upon written
notice thereof from any Certificateholder) of a breach of any of the
representations and warranties set forth in this Section which materially and
adversely affects the interests of the Certificateholders, the Servicer, the
Special Servicer or the Trustee with respect to any Mortgage Loan, the party
discovering such breach shall give prompt written notice to the other parties
hereto.
SECTION 2.5. Execution and Delivery of Certificates;
Issuance of Lower-Tier Regular Interests.
The Trustee acknowledges the assignment to it of the Mortgage
Loans and the delivery to it of the Trustee Mortgage Files to the Custodian (to
the extent the documents constituting the Trustee Mortgage Files are actually
delivered to the Custodian), subject to the provisions of Section 2.1 and
Section 2.2 and, concurrently with such delivery, (i) acknowledges the issuance
of and hereby declares that it holds the Lower-Tier Regular Interests on behalf
of the Upper-Tier REMIC and the Holders of the Regular Certificates and the
Class R Certificates and (ii) has caused to be executed and caused to be
authenticated and delivered to or upon the order of the Depositor, or as
directed by the terms of this Agreement, Class A-1, Class A-2, Class A-EC,
Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class
J-2, Class R and Class LR Certificates in authorized denominations, in each
case registered in the names set forth in such order of the Depositor or as so
directed in this Agreement and duly authenticated by the Authenticating Agent,
which Certificates (described in the preceding clause (ii)) evidence ownership
of the entire Trust Fund.
SECTION 2.6. Miscellaneous REMIC Provisions.
(a) The Class A-L-1, Class A-L-2, Class B-L, Class C-L,
Class D-L, Class E-L, Class F-L, Class G-L, Class H-L and Class J-L Interests
are hereby designated as "regular interests" in the Lower-Tier REMIC within
the meaning of Section 860G(a)(1) of the Code, and the Class LR Certificates
are hereby designated as the sole class of "residual interests" in the
Lower-Tier REMIC within the meaning of Section 860G(a)(2) of the Code. The
Class A-1, Class A-2, Class A-EC, Class B, Class C, Class D, Class E, Class F,
Class G, Class H, Class J-1 and Class J-2 Certificates are hereby designated as
"regular interests" in the Upper-Tier REMIC within the meaning of Section
860G(a)(1) of the Code and the Class R Certificates are hereby designated as
the sole class of "residual interests" in the Upper-Tier REMIC within the
meaning of Section 860G(a)(2) of the Code. The Closing Date is hereby
designated as the
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"Startup Day" of the Lower-Tier REMIC and the Upper-Tier REMIC within the
meaning of Section 860G(a)(9) of the Code. The "latest possible maturity
date" of the Lower-Tier Regular Interests and the Regular Certificates for
purposes of Code Section 860G(a)(1) is the Scheduled Final Distribution Date.
The initial Certificate Balance of each Class of Lower-Tier Regular Interests
is equal to the Certificate Balance of the Related Class of Certificates. The
pass-through rate of each Class of Lower-Tier Regular Interests is a per annum
rate equal to the Lower-Tier Pass-Through Rate.
(b) None of the Mortgage Loan Seller, Depositor, Trustee
or Servicer shall enter into any arrangement by which the Trust Fund will
receive a fee or other compensation for services other than as specifically
contemplated herein.
SECTION 2.7. Documents Not Delivered to Custodian.
All original documents relating to the Mortgage Loans which
are part of the Servicer Mortgage File are and shall be held by the Servicer,
in trust for the benefit of the Trustee on behalf of the Certificateholders.
The legal ownership of all records and documents with respect to each Mortgage
Loan prepared by or which come into the possession of the Servicer shall
immediately vest in the Trustee, in trust for the benefit of the
Certificateholders.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.1. Servicer to Act as Servicer; Special Servicer
to Act as Special Servicer; Administration of
the Mortgage Loans.
(a) The Servicer and the Special Servicer, each as an
independent contractor, shall service and administer the Mortgage Loans (or in
the case of the Special Servicer, the Specially Serviced Mortgaged Loans and
the REO Mortgage Loans) on behalf of the Trust Fund solely in the best
interests of, and for the benefit of, all of the Certificateholders and the
Trustee (as trustee for the Certificateholders) in accordance with the terms of
this Agreement and the respective Mortgage Loans. In furtherance of, and to
the extent consistent with, the foregoing, and except to the extent that this
Agreement provides for a contrary specific course of action, each of the
Servicer and the Special Servicer shall service and administer each Mortgage
Loan in the same manner in which, and with the same care, skill, prudence and
diligence with which, it services and administers similar mortgage loans for
other third-party portfolios, giving due consideration to customary and usual
standards of practice of prudent institutional commercial mortgage loan
servicers used with respect to loans comparable to the Mortgage Loans, and
taking into account its other obligations hereunder, but without regard to:
(i) any other relationship that the Servicer, the Special
Servicer, any subservicer or any Affiliate of the
Servicer, the Special Servicer or any subservicer may
have with the related Borrower or any Affiliate of
such Borrower;
(ii) the ownership of any Certificate by the Servicer, the
Special Servicer or any Affiliate of either;
(iii) the Servicer's, the Trustee's or the Fiscal Agent's
obligation to make P&I Advances or Property Advances
or to incur servicing expenses with respect to such
Mortgage Loan;
(iv) the Servicer's, the Special Servicer's or any
sub-servicer's right to receive compensation for its
services hereunder or with respect to any particular
transaction; or
(v) the ownership or servicing or management for others
by the Servicer, the Special Servicer or any
sub-servicer, of any other mortgage loans or
property.
The standards set forth above with respect to the conduct of
the Servicer and the Special Servicer in the performance of their obligations
under this Agreement is herein referred to as the "Servicing Standard."
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The Servicer's or the Special Servicer's liability for actions
and omissions in its capacity as Servicer or Special Servicer, as the case may
be, hereunder is limited as provided herein (including, without limitation,
pursuant to Section 6.3 hereof). To the extent consistent with the foregoing
and subject to any express limitations set forth in this Agreement, the
Servicer and the Special Servicer shall seek to maximize the timely and
complete recovery of principal and interest on the Notes; provided, however,
that nothing herein contained shall be construed as an express or implied
guarantee by the Servicer or the Special Servicer of the collectability of the
Mortgage Loans. Subject only to the above-described Servicing Standard and the
terms of this Agreement and of the respective Mortgage Loans, the Servicer and
the Special Servicer shall have full power and authority, acting alone or
through sub-servicers (subject to paragraph (c) of this Section 3.1 and to
Section 3.2), to do or cause to be done any and all things in connection with
such servicing and administration which they may deem necessary or desirable.
Without limiting the generality of the foregoing, the Servicer and the Special
Servicer shall, and each is hereby authorized and empowered by the Trustee to,
with respect to each Mortgage Loan and the related Mortgaged Property, prepare,
execute and deliver, on behalf of the Certificateholders and the Trustee or any
of them, any and all financing statements, continuation statements and other
documents or instruments necessary to maintain the lien on the related
Mortgaged Property and related collateral; any modifications, waivers, consents
or amendments to or with respect to any Mortgage Loan or any documents
contained in the related Mortgage File; and any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge, and
all other comparable instruments, if, in its reasonable judgment, such action
is in the best interests of the Certificateholders and is in accordance with,
or is required by, this Agreement. Notwithstanding the foregoing, neither the
Servicer nor the Special Servicer shall modify, amend, waive or otherwise
consent to the change of the stated Maturity Date of any Mortgage Loan, the
payment of principal of, or interest or Default Interest on, any Mortgage Loan,
or any other term of a Mortgage Loan, unless (a) such modification, amendment,
waiver or consent is not a "significant modification" under Section 1001 of
the Code, including proposed, temporary or final Treasury regulations
thereunder, or Treasury Regulations Section 1.860G-2(b)(3) (other than clause
(i) thereof), (b) to the extent such modification, amendment, waiver or consent
would constitute a "significant modification" under the preceding clause (a),
such Mortgage Loan is in default or a default with respect thereto is
reasonably foreseeable or (c) permitted by Section 3.10 hereof. The Servicer
and the Special Servicer shall service and administer the Mortgage Loans in
accordance with applicable state and federal law and shall provide to the
Borrowers any reports required to be provided to them thereby. Subject to
Section 3.11, the Trustee shall, upon the receipt of a written request of a
Servicing Officer, execute and deliver to the Servicer and the Special Servicer
any powers of attorney and other documents prepared by the Servicer or the
Special Servicer and necessary or appropriate (as certified in such written
request) to enable the Servicer and the Special Servicer to carry out their
servicing and administrative duties hereunder; provided, however, that the
Trustee shall not be liable for any actions of the Servicer or Special Servicer
under any such powers of attorney.
(b) Unless otherwise provided in the related Note, the
Servicer shall apply any partial Principal Prepayment received on a Mortgage
Loan on a date other than a Due Date to the principal balance of such Mortgage
Loan as of the Due Date immediately following the date of receipt of such
partial Principal Prepayment.
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(c) With respect to each Mortgage Loan that provides for
prepayment at the option of the mortgagee, the Servicer or the Special
Servicer, as applicable, shall exercise such option at the earliest possible
date as provided in the related Note and Mortgage Loan Documents.
(d) The Servicer or the Special Servicer may enter into
sub-servicing agreements with third parties with respect to any of its
respective obligations hereunder, provided that (1) any such agreement shall be
consistent with the provisions of this Agreement and (2) no sub-servicer
retained by the Servicer or the Special Servicer shall grant any modification,
waiver or amendment to any Mortgage Loan without the approval of the Servicer
or the Special Servicer, as applicable, which approval shall be given or
withheld in accordance with the procedures set forth in Section 3.10(a), and
(3) such agreement shall be consistent with the standards set forth in Section
3.1(a). Any such sub-servicing agreement may permit the sub-servicer to
delegate its duties to agents or subcontractors so long as the related
agreements or arrangements with such agents or subcontractors are consistent
with the provisions of this Section 3.1(c).
Any sub-servicing agreement entered into by the Servicer or
the Special Servicer, shall provide that it may be assumed or terminated by the
Trustee if the Trustee or a successor Servicer or Special Servicer has assumed
the duties of the Servicer or the Special Servicer, as applicable, without cost
or obligation to the assuming or terminating party or the Trust Fund, upon the
assumption by the Trustee or a successor Servicer or Special Servicer of the
obligations of the Servicer or the Special Servicer, as applicable, pursuant to
Section 7.2.
Any sub-servicing agreement, and any other transactions or
services relating to the Mortgage Loans involving a sub-servicer, shall be
deemed to be between the Servicer or the Special Servicer, as applicable, and
such sub-servicer alone, and the Trustee and the Certificateholders shall not
be deemed parties thereto and shall have no claims, rights, obligations, duties
or liabilities with respect to the sub-servicer, including the Depositor acting
in such capacity, except as set forth in Section 3.1(d).
(e) If the Trustee or any successor Servicer or Special
Servicer assumes the obligations of the Servicer or the Special Servicer, as
applicable, in accordance with Section 7.2, the Trustee or such successor
Servicer or Special Servicer, to the extent necessary to permit the Trustee or
such successor Servicer or Special Servicer to carry out the provisions of
Section 7.2, shall, without act or deed on the part of the Trustee or such
successor Servicer or Special Servicer, succeed to all of the rights and
obligations of the Servicer or Special Servicer under any sub-servicing
agreement entered into by the Servicer or Special Servicer pursuant to Section
3.1(c), subject to the right of termination by the Trustee set forth in Section
3.1(c). In such event, the Trustee or such successor Servicer or Special
Servicer shall be deemed to have assumed all of the Servicer's or Special
Servicer's interest therein (but not any liabilities or obligations in respect
of acts or omissions of the Servicer or Special Servicer prior to such deemed
assumption) and to have replaced the Servicer or the Special Servicer, as
applicable, as a party to such sub-servicing agreement to the same extent as if
such sub-servicing agreement had been assigned to the Trustee or such successor
Servicer, except that the Servicer or the Special Servicer shall not thereby be
relieved of any liability or obligations under such
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sub-servicing agreement that accrued prior to the assumption of duties
hereunder by the Trustee or such successor Servicer or Special Servicer.
In the event that the Trustee or any successor Servicer or
Special Servicer assumes the servicing obligations of the Servicer or the
Special Servicer, as the case may be, upon request of the Trustee or such
successor Servicer or Special Servicer, as the case may be, the Servicer or
Special Servicer shall, at its own expense, deliver to the Trustee or such
successor Servicer or Special Servicer (as the case may be) all documents and
records relating to any sub-servicing agreement and the Mortgage Loans then
being serviced thereunder and an accounting of amounts collected and held by
it, if any, and the Servicer will otherwise use its best efforts to effect the
orderly and efficient transfer of any sub-servicing agreement to the Trustee or
such successor Servicer.
(f) Notwithstanding anything herein to the contrary, the
Servicer shall service the Seaport Participation Interest in accordance with
the Seaport Participation Agreement, and in connection therewith, the Servicer
shall (i) receive the payments due and payable with respect to the Seaport
Participation Interest and deposit such payments into the Collection Account in
accordance with Section 3.5 of this Agreement, (ii) enforce the Seaport
Participation Agreement and all other documentation with respect thereto in
accordance with the Seaport Participation Agreement and this Agreement and
(iii) take such other actions with respect thereto as shall be required in
accordance with the Servicing Standard and this Agreement (including, without
limitation, making Advances with respect to the Trust Fund's participation
interest in the Seaport Loan as evidenced by the Seaport Participation
Certificate) to the extent and in the manner provided herein with respect to
the making of Advances for other Mortgage Loans. Pursuant to the Seaport
Participation Agreement, the Servicer shall pay as an expense of the Trust Fund
(i) to the special servicer under the Prior Pooling and Servicing Agreement a
proportionate share of any special servicing fee that becomes due with respect
to the Seaport Loan if and when the Seaport Loan becomes a specially serviced
mortgage loan under the Prior Pooling and Servicing Agreement and (ii) to the
servicer under the Prior Pooling and Servicing Agreement a proportionate share
of (x) the amount of any property advances made under the Prior Pooling and
Servicing Agreement deemed to be nonrecoverable advances thereunder and (y) the
advance interest amount which has accrued on any reimbursed property advances
incurred with respect to the Seaport Loan under the Prior Pooling and Servicing
Agreement.
SECTION 3.2. Liability of the Servicer.
Notwithstanding any sub-servicing agreement, any of the
provisions of this Agreement relating to agreements or arrangements between the
Servicer or Special Servicer and any Person acting as sub-servicer (or its
agents or subcontractors) or any reference to actions taken through any Person
acting as sub-servicer or otherwise, the Servicer or the Special Servicer, as
applicable, shall remain obligated and primarily liable to the Trustee and
Certificateholders for the servicing and administering of the Mortgage Loans in
accordance with the provisions of this Agreement without diminution of such
obligation or liability by virtue of such sub-servicing agreements or
arrangements or by virtue of indemnification from the Depositor or any Person
acting as sub-servicer (or its agents or subcontractors) to the same extent and
under the same terms and conditions as if the Servicer or Special Servicer, as
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applicable, were servicing and administering the Mortgage Loans alone. The
Servicer or the Special Servicer, as applicable, shall be entitled to enter
into an agreement with any sub-servicer providing for indemnification of the
Servicer or the Special Servicer, as applicable, by such sub-servicer, and
nothing contained in this Agreement shall be deemed to limit or modify such
indemnification, but no such agreement for indemnification shall be deemed to
limit or modify this Agreement.
SECTION 3.3. Collection of Certain Mortgage Loan Payments.
The Servicer and the Special Servicer shall make reasonable
efforts to collect all payments called for under the terms and provisions of
the Mortgage Loans when the same shall be due and payable, and shall follow
such collection procedures as it would follow with respect to mortgage loans
comparable to the Mortgage Loans and held for other third-party portfolios,
including using its best efforts in accordance with the Servicing Standard to
collect income statements and rent rolls from the related Borrowers as required
by the related Mortgage Loan Documents and providing (in the case of the
Servicer only) reasonable advance notice to such Borrowers of Balloon Payments
due with respect to such Mortgage Loans. Consistent with the foregoing, the
Servicer or the Special Servicer, as applicable, may in its discretion waive
any late payment charge or penalty fees in connection with any delinquent
Monthly Payment or Balloon Payment with respect to any Mortgage Loan.
SECTION 3.4. Collection of Taxes, Assessments and Similar
Items.
(a) With respect to each Mortgage Loan (other than REO
Mortgage Loans), the Servicer shall maintain accurate records with respect to
each related Mortgaged Property reflecting the status of taxes, assessments and
other similar items that are or may become a lien on such related Mortgaged
Property, the status of insurance premiums payable with respect thereto and the
amounts of Escrow Payments, if any, required in respect thereof. From time to
time, the Servicer shall (i) obtain all bills for the payment of such items
(including renewal premiums), and (ii) effect payment of all such bills with
respect to each such Mortgaged Property prior to the applicable penalty or
termination date, in each case employing for such purpose Escrow Payments as
allowed under the terms of such Mortgage Loan. If a Borrower fails to make any
such Escrow Payment on a timely basis or collections from such Borrower are
insufficient to pay any such item before the applicable penalty or termination
date, the Servicer shall (in accordance with Section 3.8 with respect to the
payment of insurance premiums) advance the amount necessary to effect payment
of any such item, unless the Servicer, in its good faith business judgment,
determines that such Advance would be a Nonrecoverable Advance. With respect
to any Mortgage Loan as to which the related Borrower is not required to make
Escrow Payments, if such Borrower fails to effect payment of any such bill,
then, the Servicer shall (in accordance with Section 3.8 with respect to the
payment of insurance premiums) advance the amount necessary to effect payment
of any such bill on or before the applicable penalty or termination date
unless, with respect to the payment of taxes and assessments, (x) the Servicer
reasonably anticipates that such bill will be paid by the Borrower by the close
of business on or before the penalty date, but in any event the Servicer shall
make such advance (subject to clause (y) below) within 90 days after such date
or within five Business Days after the Servicer has received confirmation that
such item has not been paid, whichever
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is earlier, or (y) the Servicer determines, in its good faith business
judgment, that such Property Advance would be a Nonrecoverable Advance. The
Servicer shall be entitled to reimbursement of Property Advances that it makes
pursuant to the preceding sentence, with interest thereon at the Advance Rate,
from amounts received on or in respect of the Mortgage Loan respecting which
such Property Advance was made or if such Property Advance has become a
Nonrecoverable Advance, to the extent permitted by Section 3.6 of this
Agreement. No costs incurred by the Servicer in effecting the payment of taxes
and assessments on the Mortgaged Properties shall, for the purpose of
calculating distributions to Certificateholders, be added to the amount owing
under the related Mortgage Loans, notwithstanding that the terms of such
Mortgage Loans so permit.
(b) The Servicer shall segregate and hold all funds
collected and received pursuant to any Mortgage Loan constituting Escrow
Payments separate and apart from any of its own funds and general assets and
shall establish and maintain one or more segregated custodial accounts (each,
an "Escrow Account") into which all Escrow Payments shall be deposited within
one (1) Business Day after receipt. The Servicer shall also deposit into each
Escrow Account any amounts representing losses on Permitted Investments in
which amounts on deposit in such Escrow Account have been invested pursuant to
Section 3.7(b) and any Insurance Proceeds, Condemnation Proceeds or Liquidation
Proceeds which are required to be applied to the restoration or repair of the
related Mortgaged Property pursuant to the related Mortgage Loan. Escrow
Accounts shall be Eligible Accounts and shall be entitled, "Midland Loan
Services, L.P., as Servicer, in trust for LaSalle National Bank, as Trustee in
trust for Holders of Prudential Securities Secured Financing Corporation,
Commercial Mortgage Pass-Through Certificates, Series 1995-MCF-2, and Various
Borrowers." Withdrawals from an Escrow Account may be made by the Servicer
only:
(i) to effect timely payments of items with respect to
which Escrow Payments are required pursuant to the
related Mortgage;
(ii) to transfer funds to the Collection Account to
reimburse the Servicer, the Trustee or the Fiscal
Agent, as applicable, for any Advance relating to
Escrow Payments, but only from amounts received with
respect to the related Mortgage Loan which represent
late collections of Escrow Payments thereunder;
(iii) for application to the restoration or repair of the
related Mortgaged Property in accordance with the
related Mortgage Loan and the Servicing Standard;
(iv) to clear and terminate such Escrow Account upon the
termination of this Agreement;
(v) to pay from time to time to the Servicer any interest
or investment income earned on funds deposited in
such Escrow Account pursuant to Section 3.7(b) to the
extent (a) permitted by law and (b) not required to
be paid to the related Borrower under the terms of
the related Mortgage Loan or
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by law, or to pay such interest or income to the
related Borrower if such income is required to paid to
the related Borrower under law or by the terms of the
related Mortgage Loan;
(vi) to remit to the related Borrower the Financial and
Lease Reporting Fee as and when required pursuant to
the related Mortgage; and
(vii) to remove any funds deposited in such Escrow Account
that were not required to be deposited therein.
SECTION 3.5. Collection Account; Distribution Account.
(a) The Servicer shall establish and maintain the
Collection Account in the Trustee's name, for the benefit of the
Certificateholders and the Trustee as the Holder of the Lower-Tier Regular
Interests. The Collection Account shall be established and maintained as an
Eligible Account. The Servicer shall deposit or cause to be deposited in the
Collection Account within one Business Day following receipt the following
payments and collections received or made by it on or with respect to the
Mortgage Loans:
(i) all payments on account of principal on the Mortgage
Loans, including the principal component of
Unscheduled Payments on the Mortgage Loans;
(ii) all payments on account of interest and Default
Interest on the Mortgage Loans and the interest
portion of all Unscheduled Payments and all
Prepayment Premiums;
(iii) any amounts required to be deposited pursuant to
Section 3.7(b) in connection with losses realized on
Permitted Investments with respect to funds held in
the Collection Account and pursuant to Section 3.25
in connection with Prepayment Interest Shortfalls;
(iv) (x) all Net REO Proceeds transferred from an REO
Account pursuant to Section 3.17(b) and (y) all
Condemnation Proceeds, Insurance Proceeds and Net
Liquidation Proceeds not required to be applied to
the restoration or repair of the related Mortgaged
Property;
(v) any amounts received from Borrowers which represent
recoveries of Property Protection Expenses or
Property Advances made pursuant to Section 3.4;
(vi) any other amounts required by the provisions of this
Agreement to be deposited into the Collection Account
by the Servicer or the Special Servicer, including,
without limitation, proceeds of any purchase or
repurchase of a Mortgage Loan pursuant to Section
2.3(d) or (e), Section 3.18 or Section 9.1 hereof;
and
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(vii) all amounts collected in respect of the Seaport
Participation Interest.
The foregoing requirements for deposits in the Collection
Account shall be exclusive, it being understood and agreed that, without
limiting the generality of the foregoing, payments in the nature of late
payment charges, late fees, Assumption Fees, loan modification fees, loan
service transaction fees, extension fees, demand fees, beneficiary statement
charges and similar fees need not be deposited in the Collection Account by the
Servicer and, to the extent permitted by applicable law, the Servicer or the
Special Servicer, as applicable, shall be entitled to retain any such charges
and fees received with respect to the Mortgage Loans. In the event that the
Servicer deposits in the Collection Account any amount not required to be
deposited therein, the Servicer may at any time withdraw such amount from the
Collection Account, any provision herein to the contrary notwithstanding.
(b) The Trustee shall establish and maintain the
Distribution Account in the name of the Trustee, in trust for the benefit of
the Certificateholders. The Distribution Account shall be established and
maintained as an Eligible Account.
(c) Funds in the Collection Account and the Distribution
Account may be invested in Permitted Investments in accordance with the
provisions of Section 3.7. The Servicer shall give written notice to the
Trustee of the location and account number of the Collection Account and shall
notify the Trustee in writing prior to any subsequent change thereof.
SECTION 3.6. Permitted Withdrawals from the Collection
Account.
The Servicer may make withdrawals from the Collection Account
only as described below (the order set forth below not constituting an order of
priority for such withdrawals):
(i) to remit to the Trustee, for deposit in the
Distribution Account, the amounts required to be
deposited in the Distribution Account pursuant to
Section 4.6;
(ii) to pay or reimburse the Servicer, the Trustee or the
Fiscal Agent for Advances, the right of the Servicer,
the Trustee or the Fiscal Agent to reimburse itself
pursuant to this clause (ii) being limited to either
(x) any collections on or in respect of the
particular Mortgage Loan or REO Property respecting
which each such Advance was made, or (y) any other
amounts in the Collection Account in the event that
such Advances have been deemed to be Nonrecoverable
Advances or are not recovered from recoveries in
respect of the related Mortgage Loan or REO Property
after a Final Recovery Determination;
(iii) to pay to the Servicer, the Trustee or the Fiscal
Agent the Advance Interest Amount;
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(iv) to pay on or before each Remittance Date to the
Servicer and the Special Servicer, as applicable, as
compensation, the unpaid Servicing Fee and Special
Servicing Fee, respectively, in respect of the
related Distribution Date (in each case, reduced up
to the amount of any Prepayment Interest Shortfalls
with respect to such Distribution Date, in accordance
with Section 3.25), to be paid, in the case of the
Servicing Fee, from interest received on the related
Mortgage Loans, and to pay from time to time, to the
Servicer any interest or investment income earned on
funds deposited in the Collection Account, and to pay
to the Servicer as additional Servicing Compensation
any Prepayment Interest Surplus received in the
preceding Collection Period and to pay to the
Servicer or the Special Servicer, as applicable, any
other amounts constituting Servicing Compensation;
(v) to pay on or before each Distribution Date to the
Depositor, the Mortgage Loan Seller, Midland L.P. or
the purchaser of any Specially Serviced Mortgage Loan
or REO Property, as the case may be, with respect to
each Mortgage Loan or REO Property that has
previously been purchased or repurchased by it
pursuant to Section 2.3(d), 2.3(e), Section 3.18 or
Section 9.1, all amounts received thereon during the
related Collection Period and subsequent to the date
as of which the amount required to effect such
purchase or repurchase was determined;
(vi) to the extent not reimbursed or paid pursuant to any
other clause of this Section 3.6, to reimburse or pay
the Servicer, the Special Servicer, the Trustee, the
Depositor and/or the Fiscal Agent for unpaid items
incurred by or on behalf of such Person pursuant to
the second sentence of Section 3.1(f), the second
sentence of Section 3.7(c), Section 3.8(a), Section
3.10, Section 3.12(d), Section 3.17(a), (b) and (c),
Section 3.18(a), 6.3, 7.4, 8.5(d), 9.1(d) or Section
10.7, or any other provision of this Agreement
pursuant to which such Person is entitled to
reimbursement or payment from the Trust Fund, in each
case only to the extent reimbursable under such
Section, it being acknowledged that this clause (vi)
shall not be deemed to modify the substance of any
such Section, including the provisions of such
Section that set forth the extent to which one of the
foregoing Persons is or is not entitled to payment or
reimbursement;
(vii) to deposit in one or more separate, non-interest
bearing accounts any amount reasonably determined by
the Trustee to be necessary to pay any applicable
federal, state or local taxes imposed on the
Lower-Tier REMIC under the circumstances and to the
extent described in Section 4.5;
(viii) to withdraw any amount deposited into the Collection
Account that was not required to be deposited
therein; and
(ix) to clear and terminate the Collection Account
pursuant to Section 9.1.
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The Servicer shall keep and maintain separate accounting, on a
Mortgage Loan-by-Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account pursuant to subclauses (ii) - (viii)
above.
The Servicer shall pay to the Trustee or the Special Servicer
from the Collection Account (to the extent permitted by clauses (i)-(viii)
above) amounts permitted to be paid to the Trustee or the Special Servicer
therefrom, promptly upon receipt of a certificate of a Responsible Officer of
the Trustee or a Servicing Officer of the Special Servicer, as applicable,
describing the item and amount to which the Trustee or the Special Servicer is
entitled. The Servicer may rely conclusively on any such certificate and shall
have no duty to recalculate the amounts stated therein.
The Trustee, the Special Servicer and the Servicer shall in
all cases have a right prior to the Certificateholders to any funds on deposit
in the Collection Account from time to time for the reimbursement or payment of
Servicing Compensation, Advances (subject to the limitation set forth in
Section 3.6(ii)) and their respective expenses (including Advance Interest
Amounts) hereunder to the extent such expenses are to be reimbursed or paid
from amounts on deposit in the Collection Account pursuant to this Agreement.
SECTION 3.7. Investment of Funds in the Collection
Account, the Distribution Account and the Reserve Accounts.
(a) The Servicer (or with respect to any REO Account, the
Special Servicer) may direct (or, with respect to the Distribution Account,
cause the Trustee to direct) any depository institution maintaining the
Collection Account, the Distribution Account, any REO Account or (subject to
applicable laws and the related Mortgage Loan Documents) any Reserve Accounts
(each, for purposes of this Section 3.7, an "Investment Account") to invest
the funds in such Investment Account in one or more Permitted Investments that
bear interest or are sold at a discount, and that mature, unless payable on
demand, no later than the Business Day preceding the date on which such funds
are requited to be withdrawn from such Investment Account pursuant to this
Agreement; provided, however, that all investments in the Distribution Account,
including those payable on demand, shall mature no later than the Business Day
prior to the next Distribution Date. Any direction by the Servicer (or with
respect to an REO Account, the Special Servicer) to invest funds on deposit in
an Investment Account shall be in writing and shall certify that the requested
investment is a Permitted Investment which matures at or prior to the time
required hereby or is payable on demand. In the case of any Reserve Account,
the Servicer shall act upon the written request of the related Borrower or
Manager to the extent the Servicer is required to do so under the terms of the
related Mortgage Loan, provided that in the absence of appropriate written
instructions from such Borrower or Manager meeting the requirements of this
Section 3.7, the Servicer shall have no obligation to, but will be entitled to,
direct the investment of funds in such Reserve Accounts. All such Permitted
Investments shall be held to maturity, unless payable on demand. Any
investment of funds in an Investment Account shall be made in the name of the
Trustee (in its capacity as such) or in the name of a nominee of the Trustee.
The Trustee shall have sole control (except with respect to investment
direction which shall be in the sole control of the Servicer or the Special
Servicer, as applicable, as an independent contractor to the Trust Fund) over
each such investment and
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any certificate or other instrument evidencing any such investment shall be
delivered directly to the Trustee or its agent (which shall initially be the
Servicer), together with any document of transfer, if any, necessary to
transfer title to such investment to the Trustee or its nominee. The Trustee
shall have no responsibility or liability with respect to the investment
directions of the Servicer or the Special Servicer or any losses resulting
therefrom, whether from Permitted Investments or otherwise. In the event
amounts on deposit in an Investment Account are at any time invested in a
Permitted Investment payable on demand, the Servicer or the Special Servicer,
as applicable, 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 Servicer
or the Special Servicer, as applicable, that
such Permitted Investment would not
constitute a Permitted Investment in respect
of funds thereafter on deposit in the related
Investment Account.
(b) All income and gain realized from investment of funds
deposited in the Collection Account, the Distribution Account and any Reserve
Account as to which the related Borrower is not entitled to interest thereon
shall be for the benefit of the Servicer (other than income or gain realized
from investment of funds on deposit in the Distribution Account made by the
Trustee on the Business Day prior to any Distribution Date that matures on such
Distribution Date) and all income and gain realized from investment of funds
deposited in any REO Account shall be for the benefit of the Special Servicer
and, other than with respect to the Distribution Account, may be withdrawn by
the Servicer or the Special Servicer, as applicable, from time to time in
accordance with Section 3.6 and Section 3.17(b), as applicable. The Servicer
may request that the Trustee withdraw and remit to the Servicer all amounts due
to it with respect to the Distribution Account pursuant to the preceding
sentence. The Servicer shall deposit from its own funds in the Collection
Account and the Distribution Account, as the case may be, the amount of any
loss incurred in respect of any such Permitted Investment immediately upon
realization of such loss and the Special Servicer shall deposit from its own
funds in any REO Account the amount of any loss incurred in respect of any such
Permitted Investment immediately upon realization of such loss. The Servicer
shall also deposit into each Reserve Account any amounts representing losses on
Permitted Investments in which such Reserve Accounts have been invested, except
to the extent that amounts are invested for the benefit of the Borrower under
applicable law or the terms of the related Mortgage Loan. The income and gain
realized from investment of funds deposited in any Reserve Account shall be
paid from time to time to the related Borrower to the extent required under the
Mortgage Loan or applicable law.
(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
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in any other performance required under any Permitted Investment, the Trustee
may, and upon the request of Holders of Certificates representing at least 51%
of the aggregate Voting Rights of any Class shall, take such action as may be
appropriate to enforce such payment or performance, including the institution
and prosecution of appropriate proceedings. In the event the Trustee takes any
such action, the Trust Fund shall pay or reimburse the Trustee for all
reasonable out-of-pocket expenses, disbursements and advances incurred or made
by the Trustee in connection therewith. In the event that the Trustee does not
take any such action, the Servicer may take such action at its own cost and
expense.
SECTION 3.8. Maintenance of Insurance Policies and Errors and Omissions and
Fidelity Coverage.
(a) The Servicer on behalf of the Trustee, as mortgagee,
shall use its best efforts in accordance with the Servicing Standard to cause
the related Borrower to maintain for each Mortgage Loan (other than REO
Mortgage Loans), and if the Borrower does not so maintain, shall itself
maintain (subject to the provisions of this Agreement concerning Nonrecoverable
Advances) to the extent the Trustee as mortgagee has an insurable interest and
to the extent available at commercially reasonable rates, (A) fire and hazard
insurance with extended coverage on the related Mortgaged Property in an amount
which is at least equal to the lesser of (i) one hundred percent (100%) of the
then "full replacement cost" of the improvements and equipment (excluding
foundations, footings and excavation costs), without deduction for physical
depreciation, and (ii) the outstanding principal balance of the related
Mortgage Loan or such other amount as is necessary to prevent any reduction in
such policy by reason of the application of co-insurance and to prevent the
Trustee thereunder from being deemed to be a co-insurer, (B) insurance
providing coverage against 12 months of rent interruptions and (C) such other
insurance (including public liability insurance) as provided in the related
Mortgage Loan. The Special Servicer shall maintain, to the extent available at
commercially reasonable rates, fire and hazard insurance from a Qualified
Insurer with extended coverage on each REO Property in an amount which is at
least equal to one hundred percent (100%) of the then "full replacement cost"
of the improvements and equipment (excluding foundations, footings and
excavation costs), without deduction for physical depreciation. The Special
Servicer shall maintain (subject to the provisions of this Agreement regarding
Nonrecoverable Advances), to the extent available at commercially reasonable
rates, with respect to each REO Property (A) public liability insurance
providing such coverage against such risks as the Servicer or the Special
Servicer, as applicable, determines, consistent with the related Mortgage and
the Servicing Standard, to be in the best interests of the Trust Fund, and
shall cause to be maintained with respect to each REO Property (B) insurance
providing coverage against 12 months of rent interruptions, and (C) such other
insurance as provided in the related Mortgage Loan to the extent available at
commercially reasonable rates and in the case of each of (A), (B), and (C) from
a Qualified Insurer. In the case of any insurance otherwise required to be
maintained pursuant to this section that is not being so maintained because the
Servicer or the Special Servicer, as applicable, has deemed that it is not
available at commercially reasonable rates, the Servicer or the Special
Servicer, as applicable, shall deliver an Officer's Certificate to the Trustee
detailing the steps that the Servicer or the Special Servicer, as applicable,
took in seeking such insurance and the factors which led to its determination
that such insurance is not so available. Any amounts collected by the Servicer
or the Special
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Servicer, as applicable, under any such policies (other than amounts to be
applied to the restoration or repair of the related Mortgaged Property or
amounts to be released to the Borrower in accordance with the terms of the
related Mortgage) shall be deposited into the Collection Account pursuant to
Section 3.5, subject to withdrawal pursuant to Section 3.6. Any cost incurred
by the Servicer in maintaining any such insurance shall not, for the purpose of
calculating distributions to Certificateholders, be added to the unpaid
principal balance of the related Mortgage Loan, notwithstanding that the terms
of such Mortgage Loan so permit. It is understood and agreed that no
earthquake or other additional insurance other than flood insurance is to be
required of any Borrower or to be maintained by the Servicer other than
pursuant to the terms of the related Mortgage Loan Documents and pursuant to
such applicable laws and regulations as shall at any time be in force and as
shall require such additional insurance; provided, however, that each of the
Servicer and the Special Servicer may maintain earthquake insurance. If the
Mortgaged Property is located in a federally designated special flood hazard
area, the Servicer will use its best efforts in accordance with the Servicing
Standard to cause the related Borrower to maintain or will itself obtain
(subject to the provisions of this Agreement concerning Nonrecoverable
Advances) flood insurance in respect thereof to the extent available at
commercially reasonable rates. Such flood insurance shall be in an amount
equal to the lesser of (i) the unpaid principal balance of the related Mortgage
Loan and (ii) the maximum amount of such insurance required by the terms of the
related Mortgage and as is available for the related property under the
national flood insurance program (assuming that the area in which such property
is located is participating in such program). If an REO Property is located in
a federally designated special flood hazard area, the Special Servicer will
obtain (subject to the provisions of this Agreement concerning Nonrecoverable
Advances) flood insurance in respect thereof providing substantially the same
coverage as described in the preceding sentences. If at any time during the
term of this Agreement a recovery under a flood or fire and hazard insurance
policy in respect of an REO Property is not available but would have been
available if such insurance were maintained thereon in accordance with the
standards applied to Mortgaged Properties described herein, the Special
Servicer shall (subject to the provisions of this Agreement concerning
Nonrecoverable Advances) either (i) immediately deposit into the Collection
Account from its own funds the amount that would have been recovered or (ii)
apply to the restoration and repair of the property from its own funds the
amount that would have been recovered, if such application would be consistent
with the servicing standard set forth in Section 3.1(a); provided, however,
that the Special Servicer shall not be responsible for any shortfall in
insurance proceeds resulting from an insurer's refusal or inability to pay a
claim. Costs to the Servicer of maintaining insurance policies pursuant to
this Section 3.8 shall be paid by the Servicer as a Property Advance and shall
be reimbursable to the Servicer with interest at the Advance Rate, which
reimbursement may be effected under Section 3.6(vi); and costs to the Special
Servicer of maintaining insurance policies pursuant to this Section 3.8 shall
be paid and reimbursed in accordance with Section 3.17(b).
The Servicer and the Special Servicer agree to prepare and
present, on behalf of itself, the Trustee and the Certificateholders, claims
under each related insurance policy maintained pursuant to this Section 3.8(a)
in a timely fashion in accordance with the terms of such policy and to take
such reasonable steps as are necessary to receive payment or to permit recovery
thereunder.
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The Servicer (or with respect to any REO Property, the Special
Servicer) shall require that all insurance policies required hereunder shall
name the Trustee or the Servicer (or with respect to any REO Property, the
Special Servicer), on behalf of the Trustee as the mortgagee, as loss payee and
that all such insurance policies require that 30 days' notice be given to the
Servicer before termination to the extent required by the related Mortgage Loan
Documents.
(b) (I) If the Servicer or Special Servicer, as
applicable, obtains and maintains a blanket insurance policy with a Qualified
Insurer at its own expense insuring against fire and hazard losses, 12-month
rent interruptions or other required insurance on all of the Mortgage Loans, it
shall conclusively be deemed to have satisfied its obligations concerning the
maintenance of such insurance coverage set forth in Section 3.8(a), it being
understood and agreed that such policy may contain a deductible clause, in
which case the Servicer or Special Servicer, as applicable, shall, in the event
that (i) there shall not have been maintained on one or more of the related
Mortgaged Properties a policy otherwise complying with the provisions of
Section 3.8(a), and (ii) there shall have been one or more losses which would
have been covered by such a policy had it been maintained, immediately deposit
into the Collection Account from its own funds the amount not otherwise payable
under the blanket policy because of such deductible clause to the extent that
any such deductible exceeds the deductible limitation that pertained to the
related Mortgage Loan, or, in the absence of such deductible limitation, the
deductible limitation which is consistent with the Servicing Standard. In
connection with its activities as Servicer or Special Servicer hereunder, as
applicable, the Servicer and the Special Servicer each agrees to prepare and
present, on behalf of itself, the Trustee and Certificateholders, claims under
any such blanket policy which it maintains in a timely fashion in accordance
with the terms of such policy and to take such reasonable steps as are
necessary to receive payment or permit recovery thereunder.
(II) If the Servicer or the Special Servicer, as
applicable, causes any Mortgaged Property or REO Property to be covered by a
master force placed insurance policy, which policy is issued by a Qualified
Insurer and provides no less coverage in scope and amount for such Mortgaged
Property or REO Property than the insurance required to be maintained pursuant
to Section 3.8(a), the Servicer or Special Servicer shall conclusively be
deemed to have satisfied its obligations to maintain insurance pursuant to
Section 3.8(a). Such policy may contain a deductible clause, in which case the
Servicer or Special Servicer, as applicable, shall, in the event that (i) there
shall not have been maintained on the related Mortgaged Property or REO
Property a policy otherwise complying with the provisions of Section 3.8(a),
and (ii) there shall have been one or more losses which would have been covered
by such a policy had it been maintained, immediately deposit into the
Collection Account from its own funds the amount not otherwise payable under
such policy because of such deductible to the extent that any such deductible
exceeds the deductible limitation that pertained to the related Mortgage Loan,
or, in the absence of any such deductible limitation, the deductible limitation
which is consistent with the Servicing Standard.
(c) Each of the Servicer and the Special Servicer shall
maintain a fidelity bond in the form and amount that would meet the servicing
requirements of prudent institutional commercial mortgage loan servicers. The
Servicer or the Special Servicer, as applicable, shall
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be deemed to have complied with this provision if one of its respective
Affiliates has such fidelity bond coverage and, by the terms of such fidelity
bond, the coverage afforded thereunder extends to the Servicer or the Special
Servicer, as applicable. In addition, each of the Servicer and the Special
Servicer shall keep in force during the term of this Agreement a policy or
policies of insurance covering loss occasioned by the errors and omissions of
its officers and employees in connection with its obligations to service the
Mortgage Loans hereunder in the form and amount that would meet the servicing
requirements of prudent institutional commercial mortgage loan servicers. Each
of the Servicer and the Special Servicer shall cause each and every
sub-servicer for it to maintain, or cause to be maintained by any agent or
contractor servicing any Mortgage Loan on behalf of such subservicer, a
fidelity bond and an errors and omissions insurance policy which satisfy the
requirements for the fidelity bond and the errors and omissions policy to be
maintained by the Servicer or the Special Servicer pursuant to this Section
3.8(c). All fidelity bonds and policies of errors and omissions insurance
obtained under this Section 3.8(c) shall be issued by a Qualified Insurer.
SECTION 3.9. Enforcement of Due-On-Sale Clauses;
Assumption Agreements.
(a) If any Mortgage Loan contains a provision in the
nature of a "due-on-sale" clause, which, by its terms:
(i) provides that such Mortgage Loan shall (or may at the
related mortgagee's option) become due and payable
upon the sale or other transfer of an interest in the
related Mortgaged Property, or
(ii) provides that such Mortgage Loan may not be assumed
without the consent of the related mortgagee in
connection with any such sale or other transfer,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Servicer or the Special Servicer, as applicable, on behalf of the Trust Fund,
shall enforce such provision to the extent permitted under the terms of such
Mortgage Loan, applicable law and governmental regulations, unless such
provision is not enforceable under applicable law or enforcement thereof would
result in a loss of insurance coverage under any related insurance policy or
such enforcement is reasonably likely to result in meritorious legal action by
the related Borrower or except to the extent that the Servicer or the Special
Servicer, as applicable, acting in accordance with the Servicing Standard,
determines that such enforcement would not be in the best interests of the
Trust Fund. Subject to the foregoing, the Servicer or the Special Servicer, as
applicable, is authorized to take or enter into an assumption agreement from or
with the Person to whom such Mortgaged Property has been or is about to be
conveyed, or to release the original related Borrower from liability upon such
Mortgage Loan and substitute the new Borrower as obligor thereon. To the
extent permitted by law, the Servicer or the Special Servicer, as applicable,
shall enter into an assumption or substitution agreement only if the credit
status of the prospective new Borrower is in compliance with the Servicer's or
the Special Servicer's, as applicable, regular commercial mortgage origination
or servicing standards and criteria and the terms of the related Mortgage. The
Servicer or the Special Servicer, as applicable, shall notify
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the Trustee that any such assumption or substitution agreement has been
completed by forwarding to the Trustee the original of such agreement, which
document shall be added to the related Mortgage File and shall, for all
purposes, be considered a part of such Mortgage File to the same extent as all
other documents and instruments constituting a part thereof. In connection
with any such assumption or substitution agreement, the Mortgage Rate,
principal amount and other material payment terms (including any
cross-collateralization and cross-default provisions) of such Mortgage Loan
pursuant to the related Note and Mortgage shall not be changed, other than in
connection with a default or reasonably foreseeable default with respect to the
Mortgage Loan. Assumption Fees collected by the Servicer or the Special
Servicer, as applicable, for entering into an assumption or substitution
agreement will be retained by the Servicer or the Special Servicer, as
applicable, as additional servicing compensation. Notwithstanding the
foregoing, the Servicer or Special Servicer may consent to the assumption of a
Mortgage Loan by a prospective new Borrower in a bankruptcy proceeding
involving the related Mortgaged Property.
(b) If any Mortgage Loan contains a provision in the
nature of a "due-on-encumbrance" clause, which, by its terms:
(i) provides that such Mortgage Loan shall (or may at the
related mortgagee's option) become due and payable
upon the creation of any lien or other encumbrance on
such Mortgaged Property, or
(ii) requires the consent of the related mortgagee to the
creation of any such lien or other encumbrance on
such Mortgaged Property,
then, for so long as such Mortgage Loan is included in the Trust Fund, the
Servicer or the Special Servicer, as applicable, on behalf of the Trust Fund,
shall enforce such provision and in connection therewith shall (x) accelerate
the payments due on such Mortgage Loan, or (y) withhold its consent to the
creation of any such lien or other encumbrance, as applicable, except, in each
case, to the extent that the Servicer or the Special Servicer, as applicable,
acting in accordance with the Servicing Standard, determines that such
enforcement would not be in the best interests of the Trust Fund and receives
written confirmation from S&P that forbearance to enforce such provision shall
not result, in and of itself, in a downgrading, withdrawal or qualification of
the rating then assigned by S&P to any Class of Certificates. Notwithstanding
the foregoing, the Servicer or the Special Servicer, as applicable, may forbear
from enforcing any due-on-encumbrance provision in connection with any junior
or senior lien on the Mortgaged Property imposed in connection with any
bankruptcy proceeding involving the Mortgaged Property.
(c) Nothing in this Section 3.9 shall constitute a waiver
of the Trustee's right, as the mortgagee of record, to receive notice of any
assumption of a Mortgage Loan, any sale or other transfer of the related
Mortgaged Property or the creation of any lien or other encumbrance with
respect to such Mortgaged Property.
(d) In connection with the taking of, or the failure to
take, any action pursuant to this Section 3.9, the Servicer or the Special
Servicer, as applicable, shall not agree to modify,
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waive or amend, and no assumption or substitution agreement entered into
pursuant to Section 3.9(a) shall contain any terms that are different from, any
term of any Mortgage Loan or the related Note or Mortgage.
SECTION 3.10. Realization Upon Mortgage Loans.
(a) With respect to any Specially Serviced Mortgage Loan,
the Special Servicer shall determine, in accordance with the Servicing
Standard, whether to grant a modification, waiver or amendment of the terms of
such Specially Serviced Mortgage Loan, commence foreclosure proceedings or
attempt to sell such Specially Serviced Mortgage Loan with reference to which
course of action is reasonably likely to produce a greater recovery on a
present value basis with respect to such Specially Serviced Mortgage Loan.
Contemporaneously with the earliest of (i) the effective date of any
modification, amendment, waiver or consent to a change of the stated maturity,
Mortgage Rate, principal balance or amortization terms of any Specially
Serviced Mortgage Loan, or any other term of a Mortgage Loan to the extent such
modification, amendment, waiver or consent would constitute a ``significant''
modification under Section 1001 of the Code, including proposed Treasury
regulations thereunder, as to which Mortgage Loan a default has occurred or is
reasonably foreseeable, (ii) 90 days after the occurrence of any uncured
payment delinquency, (iii) the date 180 days after a receiver is appointed in
respect of a Mortgaged Property, or (iv) the date a Mortgaged Property becomes
an REO Property, the Special Servicer shall obtain an appraisal of the
Mortgaged Property securing any Mortgage Loan referred to in clause (i) or (ii)
or such Mortgaged Property or REO Property, as the case may be, from an
independent appraiser who is a member of the American Institute of Real Estate
Appraisers (an "Updated Appraisal"), which appraisal shall be conducted in
accordance with MAI standards.
Following a default by a Borrower in the payment of a Balloon
Payment, the Special Servicer may grant successive extensions of up to 12
months each of the related Specially Serviced Mortgage Loan; provided that the
Special Servicer shall not grant any such successive extension if, during the
previous 12-month period (or the period since the beginning of the first such
extension, if shorter), such Borrower was 60 days or more delinquent in the
payment of any principal or interest required to be paid in any month; and
provided further that if any extension is requested after the third successive
extension has been granted, such further extension shall only be granted with
the consent of the Extension Advisor in accordance with Section 3.26. The
Special Servicer shall consider, among all relevant factors, any appraisal
obtained in accordance with the preceding paragraph in determining whether to
grant any such extension. The Special Servicer shall not grant any extension
that permits such Borrower to make payments of interest only for a period, in
the aggregate, of greater than 12 months.
(b) In connection with any foreclosure or other
acquisition, the Servicer shall, at the direction of the Special Servicer, pay
the costs and expenses in any such proceedings as an Advance unless the
Servicer determines, in its good faith judgment, that such Advance would
constitute a Nonrecoverable Advance. The Servicer shall be entitled to
reimbursement of Advances (with interest at the Advance Rate) made pursuant to
the preceding sentence to the extent permitted by Section 3.6(ii) (or Section
3.6(iii), in the case of interest at the Advance Rate).
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If the Special Servicer elects to proceed with a non-judicial
foreclosure in accordance with the laws of the state where the related
Mortgaged Property is located, the Special Servicer shall not be required to
pursue a deficiency judgment against the related Borrower or any other liable
party if the laws of such state do not permit such a deficiency judgment after
a non-judicial foreclosure or if the Special Servicer determines, in its best
judgment, that the likely recovery if a deficiency judgment is obtained will
not be sufficient to warrant the cost, time, expense and/or exposure of
pursuing such a deficiency judgment and such determination is evidenced by an
Officer's Certificate delivered to the Trustee.
In the event that title to any Mortgaged Property is acquired
in foreclosure or by deed in lieu of foreclosure, the deed or certificate of
sale shall be issued to the Trustee, or to its nominee (which shall not include
the Servicer) or a separate trustee or co-trustee on behalf of the Trustee as
holder of the Lower-Tier Regular Interests and Certificateholders.
Notwithstanding any such acquisition of title and cancellation of the related
Mortgage Loan, such Mortgage Loan shall (except for purposes of Section 9.1) be
considered to be a Mortgage Loan held in the Trust Fund until such time as the
related REO Property shall be sold by the Trust Fund and the Scheduled
Principal Balance of each REO Mortgage Loan shall be reduced by any Net REO
Proceeds allocated to principal. Consistent with the foregoing, for purposes
of all calculations hereunder, so long as such Mortgage Loan shall be
considered to be an outstanding Mortgage Loan:
(i) it shall be assumed that, notwithstanding that the
indebtedness evidenced by the related Note shall have
been discharged, such Note and, for purposes of
determining the Scheduled Principal Balance thereof,
the related amortization schedule in effect at the
time of any such acquisition of title, remain in
effect; and
(ii) Net REO Proceeds received in any month shall be
applied to amounts that would have been payable under
the related Note in accordance with the terms of such
Note. In the absence of such terms, Net REO Proceeds
shall be deemed to have been received first in
payment of the accrued interest that remained unpaid
on the date that the related REO Property was
acquired by the Trust Fund; second in respect of the
delinquent principal installments that remained
unpaid on such date; and thereafter, Net REO Proceeds
received in any month shall be applied to the payment
of installments of principal and accrued interest on
such Mortgage Loan deemed to be due and payable in
accordance with the terms of such Note and such
amortization schedule. If such Net REO Proceeds
exceed the Monthly Payment then payable, the excess
shall be treated as a Principal Prepayment received
in respect of such Mortgage Loan.
(c) Notwithstanding any provision to the contrary, the
Special Servicer shall not acquire for the benefit of the Trust Fund any
personal property pursuant to this Section 3.10 unless either:
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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 for the benefit
of the Trust Fund; or
(ii) the Special Servicer shall have requested and
received an Opinion of Counsel (which opinion shall
be an expense of the Trust Fund) to the effect that
the holding of such personal property by the
Lower-Tier REMIC will not cause the imposition of a
tax on the Lower-Tier REMIC or the Upper-Tier REMIC
under the REMIC Provisions or cause the Lower-Tier
REMIC or the Upper-Tier REMIC to fail to qualify as a
REMIC at any time that any Certificate is
outstanding.
(d) Notwithstanding any provision to the contrary in this
Agreement, the Special Servicer shall not, on behalf of the Trust Fund, obtain
title to any direct or indirect partnership interest or other equity interest
in any Borrower pledged pursuant to any pledge agreement unless the Special
Servicer shall have requested and received an Opinion of Counsel (which opinion
shall be an expense of the Trust Fund) to the effect that the holding of such
partnership or other equity interest by the Trust Fund will not cause the
imposition of a tax on the Lower-Tier REMIC or the Upper-Tier REMIC under the
REMIC Provisions or cause the Lower-Tier REMIC or the Upper-Tier REMIC to fail
to qualify as a REMIC at any time that any Certificate is outstanding.
(e) Notwithstanding any provision to the contrary
contained in this Agreement, the Special Servicer shall not, on behalf of the
Trust Fund, obtain title to a Mortgaged Property as a result of or in lieu of
foreclosure or otherwise obtain title to any direct or indirect partnership
interest or other equity interest in any Borrower pledged pursuant to a pledge
agreement and thereby be the beneficial owner of a Mortgaged Property, and
shall not otherwise acquire possession of, or take any other action with
respect to, any Mortgaged Property if, as a result of any such action, the
Trustee, for the Trust Fund or the Certificateholders, would be considered to
hold title to, to be a "mortgagee-in-possession" of, or to be an "owner" or
"operator" of such Mortgaged Property within the meaning of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended from
time to time, or any comparable law, unless the Special Servicer has previously
determined in accordance with the Servicing Standard, based on an updated
environmental assessment report prepared by an Independent Person who regularly
conducts environmental audits, that:
(A) such Mortgaged Property is in compliance with
applicable environmental laws or, if not after consultation with an
environmental consultant, that it would be in the best economic
interest of the Trust Fund to take such actions as are necessary to
bring such Mortgaged Property in compliance therewith, and
(B) there are no circumstances present at such
Mortgaged Property relating to the use, management or disposal of any
Hazardous Materials for which investigation, testing, monitoring,
containment, clean-up or remediation could be required under any
currently effective federal, state or local law or regulation, or
that, if any such Hazardous Materials are present for which such
action could be required, after
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consultation with an environmental consultant, it would be in the best
economic interest of the Trust Fund to take such actions with respect
to such Mortgaged Property.
In the event that the environmental assessment list obtained
by the Special Servicer with respect to a Mortgaged Property indicates that
such Mortgaged Property may not be in compliance with applicable environmental
laws or that Hazardous Materials may be present but does not definitively
establish such fact, the Special Servicer shall cause such further
environmental tests as the Special Servicer shall deem prudent to protect the
interests of Certificateholders to be conducted by an Independent Person who
regularly conducts such tests. Any such tests shall be deemed part of the
environmental assessment obtained by the Special Servicer for purposes of this
Section 3.10.
(f) The environmental assessment contemplated by Section
3.10(f) shall be prepared by any Independent Person who regularly conducts
environmental audits for purchasers of commercial properties located in the
same general area as the Mortgaged Property with respect to which the Special
Servicer is ordering such environmental assessment, as determined by the
Special Servicer in a manner consistent with the Servicing Standard. The
Servicer shall at the direction of the Special Servicer advance the cost of
preparation of such environmental assessments unless the Servicer determines,
in its good faith judgment, that such Advance would be a Nonrecoverable
Advance. The Servicer shall be entitled to reimbursement of Advances (with
interest at the Advance Rate) made pursuant to the preceding sentence to the
extent permitted pursuant to Section 3.6.
(g) If the Special Servicer determines pursuant to
Section 3.10(f)(A) that a Mortgaged Property is not in compliance with
applicable environmental laws but that it is in the best economic interest of
the Trust Fund to take such actions as are necessary to bring such Mortgaged
Property into compliance therewith, or if the Special Servicer determines
pursuant to Section 3.10(f)(B) that the circumstances referred to therein
relating to Hazardous Materials are present but that it is in the best economic
interest of the Trust Fund to take such action with respect to the containment,
clean-up or remediation of Hazardous Materials affecting such Mortgaged
Property as is required by law or regulation, the Special Servicer shall take
such action as it deems to be in the best economic interest of the Trust Fund
(with due consideration to the avoidance of "mortgagee-in-possession,"
"owner" or "operator" status, as set forth in Section 3.10(f)), but only if
the Trustee has mailed notice to the Holders of the Regular Certificates of
such proposed action, which notice shall be prepared by the Special Servicer,
and only if the Trustee does not receive, within 30 days of such notification,
instructions from the Holders of at least 51% of the aggregate Voting Rights of
such Classes directing the Special Servicer not to take such action. None of
the Trustee, the Servicer or the Special Servicer shall be obligated to take
any action or not take any action pursuant to this Section 3.10(h) at the
direction of the Certificateholders unless the Certificateholders agree to
indemnify the Trustee, the Servicer and the Special Servicer with respect to
such action or inaction. None of the Special Servicer, Servicer or the Trustee
shall be required to advance the cost of any such compliance, containment,
clean-up or remediation and such expense shall be an expense of the Trust Fund.
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(h) The Special Servicer shall report to the IRS and to
the related Borrower, in the manner required by applicable law, the information
required to be reported regarding any Mortgaged Property which is abandoned or
foreclosed. The Special Servicer shall deliver a copy of any such report to
the Trustee.
(i) The costs of any appraisal obtained pursuant to this
Section 3.10 shall be paid by the Servicer as an Advance and shall be
reimbursable (with interest thereon at the Advance Rate) from the Collection
Account.
SECTION 3.11. Trustee to Cooperate; Release of Mortgage
Files.
Upon the payment in full of any Mortgage Loan, or the receipt
by the Servicer of a notification that payment in full has been escrowed in a
manner customary for such purposes, the Servicer shall immediately notify the
Trustee and the Custodian by a certification (which certification shall include
a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Collection Account pursuant to Section 3.5(a) have been or will be so
deposited) of a Servicing Officer and shall request delivery to it of the
Mortgage File. No expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall be chargeable to the Trust Fund.
From time to time upon request of the Servicer or the Special
Servicer, and delivery to the Trustee and the Custodian of a Request for
Release, the Trustee shall promptly cause the Custodian to release the Mortgage
File (or any portion thereof) designated in such Request for Release to the
Servicer or the Special Servicer, as applicable. Upon receipt of (a) such
Mortgage File (or portion thereof) by the Custodian from the Servicer or the
Special Servicer, as applicable, or (b) in the event of a liquidation or
conversion of the related Mortgage Loan into an REO Property, a certificate of
a Servicing Officer stating that such Mortgage Loan was liquidated and that all
amounts received or to be received in connection with such liquidation which
are required to be deposited into the Collection Account or Distribution
Account have been so deposited, or that such Mortgage Loan has become an REO
Property, the Custodian shall return the Request for Release to the Servicer or
the Special Servicer, as applicable.
Upon written certification of a Servicing Officer, the Trustee
shall execute and deliver to the Special Servicer any court pleadings, requests
for trustee's sale or other documents prepared by the Special Servicer, its
agents or attorneys, necessary to the foreclosure or trustee's sale in respect
of the Mortgaged Property or to any legal action brought to obtain judgment
against any Borrower on the related Note or Mortgage or to obtain a deficiency
judgment, or to enforce any other remedies or rights provided by such Note or
Mortgage or otherwise available at law or in equity. Each such certification
shall include a request that such pleadings or documents be executed by the
Trustee and a statement as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the related Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's
sale.
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SECTION 3.12. Servicing Compensation and Trustee Fees.
(a) As compensation for its activities hereunder, the
Servicer shall be entitled to the Servicing Fee, which shall be payable solely
from receipts on the related Mortgage Loans, and may be withheld from payments
on account of interest prior to deposit in the Collection Account, or may be
withdrawn from amounts on deposit in the Collection Account as set forth in
Section 3.6(iv). The Servicer's rights to the Servicing Fee may not be
transferred in whole or in part except in connection with the transfer of all
of the Servicer's responsibilities and obligations under this Agreement. In
addition, the Servicer shall be entitled to receive, as additional servicing
compensation, any Prepayment Interest Surplus (subject to Section 3.25) and, to
the extent permitted by applicable law and the related Notes and Mortgages, any
late payment charges, late fees, Assumption Fees, loan modification fees,
extension fees, Financial and Lease Reporting Fees (to the extent such fees are
not required to be remitted to the related Borrower pursuant to the related
Note), loan service transaction fees, beneficiary statement charges, or similar
items (but not including any Default Interest or Prepayment Premiums), in each
case to the extent received, with respect to any Mortgage Loan that is not a
Specially Serviced Mortgage Loan and not required to be deposited or retained
in the Collection Account pursuant to Section 3.5. The Servicer shall also be
entitled pursuant to, and to the extent provided in, Section 3.7(b) to withdraw
from the Collection Account and to receive from the Reserve Accounts (to the
extent not required to be paid to the related Borrower pursuant to the related
Mortgage Loan Documents or applicable law) any interest or other income earned
on deposits therein.
As compensation for its activities hereunder, the Trustee
shall be entitled to the Trustee Fee with respect to each Mortgage Loan, which
shall be paid by the Servicer from its own funds without reimbursement
therefor. The Trustee shall pay the routine fees and expenses of the
Certificate Registrar, the Paying Agent, the Custodian and the Authenticating
Agent. The Trustee's rights to the Trustee Fee may not be transferred in whole
or in part except in connection with the transfer of all of the Trustee's
responsibilities and obligations under this Agreement.
Except as otherwise provided herein, the Servicer shall pay
all expenses incurred by it in connection with its servicing activities
hereunder and the Trustee shall pay all expenses incurred by it in connection
with its activities hereunder.
(b) As compensation for its activities hereunder, the
Special Servicer shall be entitled to the Special Servicing Fee with respect to
each Specially Serviced Mortgage Loan, which shall be payable from amounts on
deposit in the Collection Account as set forth in Section 3.6(iv). The Special
Servicer's rights to the Special Servicing Fee may not be transferred in whole
or in part except in connection with the transfer of all of the Special
Servicer's responsibilities and obligations under this Agreement. The Special
Servicer shall also be entitled pursuant to, and to the extent provided in,
Section 3.7(b) to withdraw from any REO Account any interest or other income
earned on deposits therein.
In addition, the Special Servicer shall be entitled to
receive, as additional Servicing Compensation, to the extent permitted by
applicable law and the related Notes and
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Mortgages, any late payment charges, late fees, Assumption Fees, loan
modification fees, extension fees, Financial and Lease Reporting Fees (to the
extent such fees are not required to be remitted to the related Borrower
pursuant to the related Note), loan service transaction fees, beneficiary
statement charges, or similar items (but not including any Default Interest or
Prepayment Premiums), in each case to the extent received with respect to any
Specially Serviced Mortgage Loan and not required to be deposited or retained
in the Collection Account pursuant to Section 3.5.
Except as otherwise provided herein, the Special Servicer
shall pay all expenses incurred by it in connection with its servicing
activities hereunder.
(c) In addition to other Special Servicer compensation
provided for in this Agreement, and not in lieu thereof, the Special Servicer
shall be entitled to the Disposition Fee payable out of the Liquidation
Proceeds prior to the deposit of the related Net Liquidation Proceeds in the
Collection Account.
(d) The Servicer, the Special Servicer and the Trustee
shall be entitled to reimbursement from the Trust Fund for the unanticipated
costs and expenses incurred by them in the performance of their duties under
this Agreement which are ``unanticipated expenses incurred by the REMIC''
within the meaning of Treasury Regulations Section 1.860G-1(b)(3)(ii). Such
expenses shall include, by way of example and not by way of limitation,
environmental assessments, appraisals in connection with foreclosure, the fees
and expenses of any administrative or judicial proceeding and expenses
expressly identified as reimbursable in Section 3.6(vi).
(e) No provision of this Agreement or of the Certificates
shall require the Servicer, the Special Servicer, the Trustee or the Fiscal
Agent to expend or risk their own funds or otherwise incur any financial
liability in the performance of any of their duties hereunder or thereunder, or
in the exercise of any of their rights or powers, if, in the good faith
business judgment of the Servicer, Special Servicer, Trustee or the Fiscal
Agent, as the case may be, repayment of such funds would not be ultimately
recoverable from late payments, Insurance Proceeds, Condemnation Proceeds, Net
Liquidation Proceeds and other collections on or in respect of the Mortgage
Loans, or from adequate indemnity from other assets comprising the Trust Fund
against such risk or liability.
If the Servicer, the Special Servicer or the Trustee receives
a request or inquiry from a Borrower, any Certificateholder or any other Person
the response to which would, in the Servicer's, the Special Servicer's or the
Trustee's good faith business judgment, require the assistance of Independent
legal counsel or other consultant to the Servicer, the Special Servicer or the
Trustee, the cost of which would not be an expense of the Trust Fund hereunder,
then the Servicer, the Special Servicer or the Trustee, as the case may be,
shall not be required to take any action in response to such request or inquiry
unless such Borrower or such Certificateholder or such other Person, as
applicable, makes arrangements for the payment of the Servicer's, the Special
Servicer's or Trustee's expenses associated with such counsel or other
consultant (including, without limitation, posting an advance payment for such
expenses) satisfactory to the Servicer, the Special Servicer or the Trustee, as
the case may be, in its sole discretion. Unless
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such arrangements have been made, the Servicer, the Special Servicer or the
Trustee, as the case may be, shall have no liability to any Person for the
failure to respond to such request or inquiry.
SECTION 3.13. Reports to the Trustee; Collection Account
Statements.
(a) The Servicer shall deliver to the Paying Agent, with
a copy to the Trustee, the Fiscal Agent and each Rating Agency, no later than
the third Business Day following each Determination Date, but in any event no
later than the third Business Day prior to the related Distribution Date, (i)
the Servicer Remittance Report with respect to such Determination Date (which
shall include, without limitation, the amount of Pooled Available Funds for the
related Distribution Date) and (ii) a written statement of required P&I
Advances for the related Determination Date together with the certificate and
documentation required by the definition of Nonrecoverable Advance related to
any determination that any such P&I Advance would constitute a Nonrecoverable
Advance made as of such Determination Date.
(b) For so long as the Servicer makes deposits into and
withdrawals from the Collection Account, not later than fifteen days after each
Distribution Date, the Servicer shall forward to the Trustee a statement
prepared by the Servicer setting forth the status of the Collection Account as
of the close of business on the last Business Day of the related Collection
Period showing the aggregate amount of deposits into and withdrawals from the
Collection Account for each category of deposit specified in Section 3.5 and
each category of withdrawal specified in Section 3.6 for such Collection
Period. The Trustee and its agents and attorneys may at any time during normal
business hours, upon reasonable notice, inspect and copy the books, records and
accounts of the Servicer with respect to the Mortgage Loans and the performance
of its duties hereunder.
(c) The Trustee shall be entitled to rely conclusively on
and shall not be responsible for the content or accuracy of any information
provided to it by the Servicer or the Special Servicer pursuant to this
Agreement.
SECTION 3.14. Annual Statement as to Compliance.
The Servicer and the Special Servicer shall deliver to the
Trustee and to the Depositor on or before March 31 of each year, beginning with
March 31, 1997, an Officer's Certificate stating, as to each signatory thereof,
(i) that a review of the activities of the Servicer or the Special Servicer, as
applicable, during the preceding calendar year (or such shorter period from the
Closing Date to the end of the related calendar year) and of its performance
under this Agreement has been made under such officer's supervision, (ii) that,
to the best of such officer's knowledge, based on such review, it has fulfilled
all of its obligations under this Agreement throughout such year (or such
shorter period), or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer, the nature and
status thereof and what action it proposes to take with respect thereto, (iii)
that, to the best of such officer's knowledge, each sub-servicer has fulfilled
its obligations under its sub-servicing agreement in all material respects, or,
if there has been a material default in the fulfillment of such obligations,
specifying each such default known to such officer and the nature and status
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thereof, and (iv) whether it has received any notice regarding qualification,
or challenging the status, of the Upper-Tier REMIC or Lower-Tier REMIC as a
REMIC from the IRS or any other governmental agency or body.
SECTION 3.15. Annual Independent Public Accountants'
Servicing Report.
On or before March 31 of each year, beginning with March 31,
1997, the Servicer and the Special Servicer at its expense shall cause a firm
of nationally recognized Independent public accountants (who may also render
other services to the Servicer or the Special Servicer, as applicable) which is
a member of the American Institute of Certified Public Accountants to furnish a
statement to the Trustee and to the Depositor, to the effect that such firm has
examined certain documents and records relating to the servicing of the
Mortgage Loans under this Agreement and that, on the basis of such examination
conducted substantially in compliance with generally accepted auditing
standards and the Uniform Single Attestation Program for Mortgage Bankers or
the Audit Program for Mortgages serviced for FHLMC, such servicing has been
conducted in compliance with this Agreement except for such significant
exceptions or errors in records that, in the opinion of such firm, generally
accepted auditing standards and the Uniform Single Attestation Program for
Mortgage Bankers or the Audit Program for Mortgages serviced for FHLMC require
it to report, in which case such exceptions and errors shall be so reported.
SECTION 3.16. Access to Certain Documentation.
(a) The Servicer and the Special Servicer shall provide
to any Certificateholders that are federally insured financial institutions,
the Federal Reserve Board, the FDIC and the OTS and the supervisory agents and
examiners of such boards and such corporations, and any other governmental or
regulatory body to the jurisdiction of which any Certificateholder is subject,
access to the documentation regarding the Mortgage Loans required by applicable
regulations of the Federal Reserve Board, FDIC, OTS or any such governmental or
regulatory body, such access being afforded without charge but only upon
reasonable request and during normal business hours at the offices of the
Servicer or the Special Servicer, as applicable.
(b) In connection with the solicitation of bids to
purchase the Mortgage Loans pursuant to Section 9.1(d), the Servicer and the
Special Servicer shall provide each Qualified Offeror who has paid the
non-refundable deposit required pursuant to Section 9.1(d)(vi) with access to
all documents that the Auction Agent considers material to prospective
purchasers in connection with their evaluation of the purchase of the Mortgage
Loans and shall cooperate with the Auction Agent in order to facilitate
prospective purchasers' due diligence in accordance with the Auction
Procedures, including without limitation the provision of facilities in which
copies of each Mortgage File may be reviewed, provision of facilities for the
photocopying of documents relating to Mortgages in return for payment of
expenses of such photocopying, cooperation in arranging access to Mortgaged
Properties and such other matters as the Auction Agent may reasonably request;
provided, however, that the Servicer or the Special Servicer, as applicable,
shall be entitled to be compensated by Qualified Offerors for its costs of
providing such access, cooperation and facilities.
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(c) Nothing in this Section 3.16 shall detract from the
obligation of the Servicer or the Special Servicer to observe any applicable
law prohibiting disclosure of information with respect to the Borrowers or the
Mortgage Loans, and the failure of the Servicer or the Special Servicer, as
applicable, to provide access as provided in this Section 3.16 as a result of
such obligation shall not constitute a breach of this Section 3.16.
SECTION 3.17. Title and Management of REO Properties.
(a) In the event that title to any Mortgaged Property is
acquired for the benefit of Certificateholders in foreclosure, by deed in lieu
of foreclosure or upon abandonment or reclamation from bankruptcy, the deed or
certificate of sale shall be taken in the name of the Trustee, or its nominee
(which shall not include the Servicer), or a separate trustee or co-trustee, on
behalf of the Trust Fund. The Special Servicer shall maintain accurate records
with respect to each related REO Property reflecting the status of taxes,
assessments and other similar items that are or may become a lien on such REO
Property and the status of insurance premiums payable with respect thereto.
The Special Servicer, on behalf of the Trust Fund, shall dispose of any REO
Property within two years after the Trust Fund acquires ownership of such REO
Property for purposes of Section 860G(a)(8) of the Code, unless (i) the Special
Servicer, on behalf of the Lower-Tier REMIC, has applied for and received an
extension of such two-year period pursuant to Sections 856(e)(3) and
860G(a)(8)(A) of the Code, in which case the Special Servicer shall sell such
REO Property within the applicable extension period or (ii) the Special
Servicer seeks and subsequently receives an Opinion of Counsel (which opinion
shall be an expense of the Trust Fund), addressed to the Special Servicer and
the Trustee, to the effect that the holding by the Trust Fund of such REO
Property for an additional specified period will not cause such REO Property to
fail to qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code (determined without regard to the exception applicable
for purposes of Section 860D(a) of the Code) at any time that any Certificate
is outstanding, in which case the Special Servicer shall sell such REO Property
within such two-year period as extended by such additional specified period
subject to any conditions set forth in such Opinion of Counsel. The Special
Servicer, on behalf of the Trust Fund, shall dispose of any REO Property held
by the Trust Fund prior to the last day of the period (taking into account
extensions) within which such REO Property is required to be disposed of
pursuant to the provisions of the immediately preceding sentence in a manner
provided under Section 3.18 hereof. The Special Servicer shall manage,
conserve, protect and operate each REO Property for the Certificateholders
solely for the purpose of its disposition and sale in a manner which does not
cause such REO Property to fail to qualify as "foreclosure property" within
the meaning of Section 860G(a)(8) of the Code (determined without regard to the
exception applicable for purposes of Section 860D(a)).
(b) The Special Servicer shall have full power and
authority, subject only to the specific requirements and prohibitions of this
Agreement, to do any and all things in connection with any REO Property as are
consistent with the manner in which the Special Servicer manages and operates
similar property owned or managed by the Special Servicer or any of its
Affiliates, all on such terms and for such period as the Special Servicer deems
to be in the best interests of Certificateholders, and, in connection
therewith, the Special Servicer shall agree to the payment of management fees
that are consistent with general market standards. The
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Special Servicer shall segregate and hold all revenues received by it with
respect to any REO Property separate and apart from its own funds and general
assets and shall establish and maintain with respect to any REO Property a
segregated custodial account (each, an "REO Account"), each of which shall be
an Eligible Account and shall be entitled "LaSalle National Bank, as Trustee,
in trust for Holders of Prudential Securities Secured Financing Corporation,
Commercial Mortgage Pass-Through Certificates, Series 1995-MCF- 2, REO
Account." The Special Servicer shall be entitled to any interest or
investment income earned on funds deposited in an REO Account to the extent
provided in Section 3.7(b). The Special Servicer shall deposit or cause to be
deposited in the related REO Account within one Business Day after receipt all
REO Proceeds received by it with respect to any REO Property (other than
Liquidation Proceeds), and shall withdraw therefrom funds necessary for the
proper operation, management and maintenance of such REO Property and for other
Property Protection Expenses with respect to such REO Property, including:
(i) all insurance premiums due and payable in respect of
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; and
(iii) all costs and expenses reasonable and necessary to
protect, maintain, manage, operate, repair and
restore such REO Property, including any property
management fees.
To the extent that such REO Proceeds are insufficient for the
purposes set forth in clauses (i) through (iii) above, the Servicer (or, in the
event the Servicer is unable to perform, the Trustee or Fiscal Agent) shall
make an Advance equal to the amount of such shortfall unless the Servicer
determines, in its good faith judgment, that such Advance would be a
Nonrecoverable Advance. The Servicer shall be entitled to reimbursement of
such Advances (with interest at the Advance Rate) made pursuant to the
preceding sentence, to the extent permitted pursuant to Section 3.6. The
Special Servicer shall remit to the Servicer from each REO Account for deposit
in the Collection Account on a monthly basis prior to the related Remittance
Date the Net REO Proceeds received or collected from the related REO Property,
except that in determining the amount of such Net REO Proceeds, the Special
Servicer may retain in such REO Account reasonable reserves for repairs,
replacements and necessary capital improvements and other related expenses.
Notwithstanding the foregoing, the Special Servicer shall not:
(i) permit the Trust Fund to enter into, renew or extend
any New Lease if the New Lease, by its terms, will
give rise to any income that does not constitute
Rents from Real Property;
(ii) permit any amount to be received or accrued under any
New Lease other than amounts that will constitute
Rents from Real Property;
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(iii) authorize or permit any construction on any REO
Property, other than the repair or maintenance
thereof or the completion of a building or other
improvement thereon, and then only if more than ten
percent of the construction of such building or other
improvement was completed before default on the
related Mortgage Loan became imminent, all within the
meaning of Section 856(e)(4)(B) of the Code; or
(iv) Directly Operate or perform any construction work on,
or allow any Person (other than an Independent
Contractor) to Directly Operate or perform any
construction work on, any REO Property on, any date
more than 90 days after its date of acquisition by
the Trust Fund;
unless, in any such case, the Special Servicer has requested and received an
Opinion of Counsel addressed to the Special Servicer and the Trustee (which
opinion shall be an expense of the Trust Fund) to the effect that such action
will not cause such REO Property to fail to qualify as "foreclosure property"
within the meaning of Section 860G(a)(8) of the Code (determined without regard
to the exception applicable for purposes of Section 860D(a) of the Code) at any
time that it is held by the Trust Fund, in which case the Special Servicer may
take such actions as are specified in such Opinion of Counsel.
The Special Servicer shall be required to contract with an
Independent Contractor for the operation and management of any REO Property
within 90 days of the Trust Fund's acquisition thereof (unless the Special
Servicer shall have provided the Trustee with an Opinion of Counsel that the
operation and management of such REO Property other than through an Independent
Contractor shall not cause such REO Property to fail to qualify as
"foreclosure property" within the meaning of Code Section 860G(a)(8)) (which
opinion shall be an expense of the Trust Fund), provided that:
(i) the terms and conditions of any such contract shall
be reasonable and customary for the area and type of
property and shall not be inconsistent herewith;
(ii) any such contract shall require, or shall be
administered to require, that the Independent
Contractor pay all costs and expenses incurred in
connection with the operation and management of such
REO Property, including those listed above, and remit
all related revenues (net of such costs and expenses)
to the Special Servicer as soon as practicable, but
in no event later than thirty days following the
receipt thereof by such Independent Contractor;
(iii) none of the provisions of this Section 3.17(b)
relating to any such contract or to actions taken
through any such Independent Contractor shall be
deemed to relieve the Special Servicer of any of its
duties and obligations to the Trust Fund or the
Trustee on behalf of the Certificateholders with
respect to the operation and management of any such
REO Property; and
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(iv) the Special Servicer shall be obligated with respect
thereto to the same extent as if it alone were
performing all duties and obligations in connection
with the operation and management of such REO
Property.
The Special Servicer shall be entitled to enter into any
agreement with any Independent Contractor performing services for it related to
its duties and obligations hereunder for indemnification of the Special
Servicer by such Independent Contractor, and nothing in this Agreement shall be
deemed to limit or modify such indemnification.
(c) Promptly following any acquisition by the Trust Fund
of an REO Property, the Special Servicer shall obtain (i) an update of any
appraisal performed pursuant to Section 3.10 which is more than 12 months old,
or (ii) to the extent that an appraisal has not been obtained pursuant to such
Section, an appraisal of such REO Property by an Independent appraiser familiar
with the area in which such REO Property is located in order to determine the
fair market value of such REO Property and shall notify the Depositor and the
Trustee of the results of such appraisal. Any such appraisal shall be
conducted in accordance with MAI standards and the cost thereof shall be an
expense of the Trust Fund.
(d) When and as necessary, the Special Servicer shall
send to the Trustee a statement prepared by the Special Servicer setting forth
the amount of net income or net loss, as determined for federal income tax
purposes, resulting from the operation and management of a trade or business
on, the furnishing or rendering of a non-customary service to the tenants of,
or the receipt of any other amount not constituting Rents from Real Property in
respect of, any REO Property in accordance with Section 3.17(b).
SECTION 3.18. Sale of Specially Serviced Mortgage Loans and
REO Properties.
(a) With respect to any Specially Serviced Mortgage Loan
or REO Property which the Special Servicer has determined to sell in accordance
with Section 3.10 or otherwise, the Special Servicer shall deliver to the
Trustee an Officer's Certificate to the effect that the Special Servicer has
determined to sell such Specially Serviced Mortgage Loan or REO Property in
accordance with this Section 3.18. The Special Servicer may then offer to sell
to any Person such Specially Serviced Mortgage Loan or such REO Property but
shall, in any event, so offer to sell such REO Property no later than the time
determined by the Special Servicer to be sufficient to result in the sale of
such REO Property within the period specified in Section 3.17(a). The Special
Servicer shall deliver such Officer's Certificate and give the Trustee not less
than ten Business Days prior written notice of its intention to sell such
Specially Serviced Mortgage Loan or REO Property, in which case the Special
Servicer shall accept any offer received from any Person that is determined by
the Special Servicer to be a fair price, as determined in accordance with
Section 3.18(b), for such Specially Serviced Mortgage Loan or REO Property if
the offeror is a Person other than an Interested Person, or is determined to be
such a price by the Trustee if the offeror is an Interested Person; provided,
however, that the Trustee shall be entitled to engage at the expense of the
Trust Fund, an Independent appraiser to determine whether the offer is a fair
price. Notwithstanding anything to the contrary herein,
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neither the Trustee in its individual capacity nor any of its Affiliates, may
make an offer or purchase any Specially Serviced Mortgage Loan or any REO
Property pursuant hereto.
In addition, in the event that the Special Servicer receives
more than one fair offer with respect to any Specially Serviced Mortgage Loan
or REO Property, the Special Servicer may accept an offer that is not the
highest fair offer if it determines, in accordance with the Servicing Standard,
that acceptance of such offer would be in the best interests of the
Certificateholders (for example, if the prospective buyer making the lower
offer is more likely to perform its obligations, or the terms offered by the
prospective buyer making the lower offer are more favorable). In the event
that the Special Servicer determines with respect to any REO Property that the
offers being made with respect thereto are not in the best interests of the
Certificateholders and that the end of the two-year period referred to in
Section 3.17(a) with respect to such REO Property is approaching, the Special
Servicer shall seek an extension of such two-year period in the manner
described in Section 3.17(a); provided, however, that the Special Servicer
shall use its best efforts in accordance with the Servicing Standard, to sell
any REO Property no later than the day prior to the Determination Date
immediately prior to the Scheduled Final Distribution Date.
(b) In determining whether any offer received represents
a fair price for any Specially Serviced Mortgage Loan or any REO Property, the
Special Servicer or the Trustee may conclusively rely on the opinion of an
Independent appraiser or other expert in real estate matters retained by the
Special Servicer or the Trustee at the expense of the Trust Fund. In
determining whether any offer constitutes a fair price for any Specially
Serviced Mortgage Loan or any REO Property, the Special Servicer or the Trustee
(or, if applicable, such appraiser) shall take into account, and any appraiser
or other expert in real estate matters shall be instructed to take into
account, the appraisal obtained pursuant to Section 3.10(a) and, as applicable,
among other factors, the period and amount of any delinquency on such Specially
Serviced Mortgage Loan, the physical (including environmental) condition of the
related Mortgaged Property or such REO Property, the state of the local economy
and the Trust Fund's obligation to dispose of any REO Property within the time
period specified in Section 3.17(a).
(c) Subject to the provisions of Section 3.17, the
Special Servicer shall act on behalf of the Trust Fund in negotiating and
taking any other action necessary or appropriate in connection with the sale of
any Specially Serviced Mortgage Loan or REO Property, including the collection
of all amounts payable in connection therewith. Any sale of a Specially
Serviced Mortgage Loan or any REO Property shall be without recourse to, or
representation or warranty by, the Trustee, the Depositor, the Servicer, the
Special Servicer or the Trust Fund (except that any contract of sale and
assignment and conveyance documents may contain customary warranties of title,
so long as the only recourse for breach thereof is to the Trust Fund), and, if
such sale is consummated in accordance with the duties of the Special Servicer,
the Servicer, the Depositor and the Trustee pursuant to the terms of this
Agreement, no such Person who so performed shall have any liability to the
Trust Fund or any Certificateholder with respect to the purchase price therefor
accepted by the Special Servicer or the Trustee.
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(d) Net Liquidation Proceeds related to any such sale
shall be promptly, and in any event within one Business Day following receipt
thereof, deposited in the Collection Account in accordance with Section
3.5(a)(iv).
SECTION 3.19. Inspections.
The Servicer (or, with respect to Specially Serviced Mortgage
Loans and REO Properties, the Special Servicer) shall inspect or cause to be
inspected (at its own expense) each Mortgaged Property at such times and in
such manner as are consistent with the Servicing Standard, but in any event (i)
inspect each Mortgaged Property at least once every 12 months commencing in
January 1997 unless each of the Rating Agencies has confirmed in writing that a
longer period between inspections shall not result, in and of itself, in a
downgrading, withdrawal or qualification of the rating then assigned by such
Rating Agency to any Class of the Certificates; (ii) if the Servicer or the
Special Servicer retains any Financial and Lease Reporting Fees pursuant to
Section 3.12, each related Mortgaged Property shall be inspected by the
Servicer or the Special Servicer, as applicable, as soon as practicable
thereafter, except to the extent such Mortgaged Property has been inspected by
the Servicer or the Special Servicer within the immediately preceding 120 days;
and (iii) if any Monthly Payment becomes more than 60 days delinquent (without
giving effect to any grace period permitted under the related Note or
Mortgage), each related Mortgaged Property shall be inspected by the Special
Servicer (at its own expense) as soon as practicable thereafter.
SECTION 3.20. Available Information and Notices.
The Servicer or the Special Servicer, if applicable, shall
promptly give notice to the Trustee, who will copy each Certificateholder, each
Rating Agency, the Depositor and the Mortgage Loan Seller of (a) any notice
from a Borrower or insurance company regarding an upcoming voluntary or
involuntary prepayment (including that resulting from a casualty or
condemnation) of all or part of the related Mortgage Loan (provided that a
request by a Borrower or other party for a quotation of the amount necessary to
satisfy all obligations with respect to a Mortgage Loan shall not, in and of
itself, be deemed to be such notice); and (b) of any other occurrence known to
it with respect to a Mortgage Loan or REO Property that the Servicer or the
Special Servicer determines, in accordance with the Servicing Standard, would
have a material effect on such Mortgage Loan or REO Property, which notice
shall include an explanation as to the reason for such material effect
(provided that any extension of the term of any Mortgage Loan shall be deemed
to have a material effect).
Neither the Servicer nor the Special Servicer shall be
responsible for the accuracy or completeness of any information supplied to it
by a Borrower or otherwise for inclusion in any such notice, and the Servicer,
the Special Servicer and the Trustee shall be indemnified and held harmless by
the Trust Fund against any loss, liability or expense incurred in connection
with any legal action relating to any statement or omission or alleged
statement or omission therein, including any liability related to the inclusion
of such information in any report filed with the Commission.
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In addition to the other reports and information made
available and distributed to the Depositor, the Trustee or the
Certificateholders pursuant to other provisions of this Agreement, the Servicer
and the Special Servicer shall, in accordance with such reasonable rules and
procedures as it may adopt (which may include the requirement that an agreement
governing the availability, use and disclosure of such information be executed
to the extent the Servicer or the Special Servicer, as applicable, deems such
action to be necessary or appropriate), also make available any information
relating to the Mortgage Loans, the Mortgaged properties or the Borrower for
review by the Depositor, the Trustee, the Certificateholders and any other
Persons to whom the Servicer or the Special Servicer, as the case may be,
believes such disclosure is appropriate, in each case except to the extent
doing so is prohibited by applicable law or by any documents related to a
Mortgage Loan.
The Trustee shall also make available at its offices primarily
responsible for administration of the Trust Fund, during normal business hours,
for review by the Depositor, any Certificateholder, any Person identified to
the Trustee by a Certificateholder as a prospective transferee of a Certificate
and any other Persons to whom the Trustee believes such disclosure is
appropriate, the following items: (i) this Agreement, (ii) all monthly
statements to Certificateholders delivered since the Closing Date pursuant to
Section 4.2(a), (iii) all annual statements as to compliance delivered to the
Trustee and the Depositor pursuant to Section 3.14 and (iv) all annual
Independent accountants' reports delivered to the Trustee and the Depositor
pursuant to Section 3.15. The Servicer or the Special Servicer, as
appropriate, shall make available at its offices during normal business hours,
for review by the Depositor, the Trustee, any Certificateholder, any Person
identified to the Servicer or the Special Servicer, as applicable, by a
Certificateholder as a prospective transferee of a Certificate and any other
Persons to whom the Servicer or the Special Servicer, as applicable, believes
such disclosure is appropriate, the following items: (i) the inspection reports
prepared by or on behalf of the Servicer or the Special Servicer, as
applicable, in connection with the property inspections conducted by the
Servicer or the Special Servicer, as applicable, pursuant to Section 3.19, (ii)
any and all modifications, waivers and amendments of the terms of a Mortgage
Loan entered into by the Servicer or the Special Servicer and (iii) any and all
Officer's Certificates and other evidence delivered to the Trustee and the
Depositor to support the Servicer's determination that any Advance was, or if
made would be, a Nonrecoverable Advance, in each case except to the extent
doing so is prohibited by applicable laws or by any documents related to a
Mortgage Loan. Copies of any and all of the foregoing items shall be available
from the Servicer, the Special Servicer or the Trustee, as applicable, upon
request. The Servicer, the Special Servicer and the Trustee shall be permitted
to require payment (other than from any Rating Agency) of a sum sufficient to
cover the reasonable costs and expenses incurred by it in providing copies of
or access to any information requested in accordance with the previous
sentence.
The Servicer shall, on behalf of the Trust Fund, prepare, sign
and file with the Commission any and all reports, statements and information
respecting the Trust Fund which the Servicer or the Trustee determines are
required to be filed with the Commission pursuant to Sections 13(a) or 15(d) of
the 1934 Act, each such report, statement and information to be filed on or
prior to the required filing date for such report, statement or information.
Notwithstanding the foregoing, the Depositor shall file with the Commission,
within fifteen days of the Closing Date, a Current Report on Form 8-K together
with this Agreement.
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Neither the Servicer not the Trustee shall be responsible for
the accuracy or completeness of any information supplied to it by a Borrower or
a third party that is included in any report, statement or information filed
with the Commission, and both the Servicer and the Trustee shall be indemnified
and held harmless by the Trust Fund against any loss, liability or expense
incurred in connection with any legal action relating to any statement or
omission or alleged statement or omission therein resulting from such
information.
SECTION 3.21. Reserve Accounts.
The Servicer shall administer each Reserve Account in
accordance with the related Note, Mortgage and Loan Agreement.
SECTION 3.22. Property Advances.
(a) The Servicer (or, to the extent provided in Section
3.22(b), the Trustee or the Fiscal Agent) shall make any Property Advances as
and to the extent otherwise required pursuant to the terms hereof. For purpose
of calculating distributions to the Certificateholders, Property Advances shall
not be considered to increase the principal balance of any Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so provide.
(b) The Servicer shall notify the Trustee and the Fiscal
Agent in writing promptly upon, and in any event within one Business Day after,
becoming aware that it will be financially unable to make any Property Advance
required to be made pursuant to the terms hereof, and in connection therewith,
shall set forth in such notice the amount of such Property Advance, the Person
to whom it should be paid, and the circumstances and purpose of such Property
Advance, and shall set forth therein information and instructions for the
payment of such Property Advance, and, on the date specified in such notice for
the payment of such Property Advance, or, if no such date is specified, then
within one Business Day following such notice, the Trustee shall pay the amount
of such Property Advance in accordance with such information and instructions.
If the Trustee fails to make any Property Advance required to be made under
this Section 3.22, the Fiscal Agent shall make such Advance on the same day the
Trustee was required to make such Property Advance and, thereby, the Trustee
shall not be in default under this Agreement.
(c) Notwithstanding anything herein to the contrary, none
of the Servicer, the Trustee or the Fiscal Agent shall be obligated to make a
Property Advance as to any Mortgage Loan or REO Property if the Servicer, the
Trustee or the Fiscal Agent as applicable, determines that such Property
Advance, if made, would be a Nonrecoverable Advance. The Trustee and the
Fiscal Agent shall be entitled to rely, conclusively, on any determination by
the Servicer that a Property Advance, if made, would be a Nonrecoverable
Advance. The Trustee and the Fiscal Agent, in determining whether or not a
Property Advance previously made is, or a proposed Property Advance, if made,
would be, a Nonrecoverable Advance shall be subject to the standards applicable
to the Servicer hereunder.
(d) The Servicer, the Trustee and/or the Fiscal Agent, as
applicable, shall be entitled to, and the Servicer hereby covenants and agrees
to promptly seek and effect, the
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reimbursement of Property Advances to the extent permitted pursuant to Section
3.6(ii) of this Agreement, together with any related Advance Interest Amount in
respect of such Property Advances.
(e) The Servicer, the Trustee and/or the Fiscal Agent
shall not be required to make a Property Advance for any amounts required to
cure any failure of any Mortgaged Property to comply with the Americans with
Disabilities Act of 1990, as amended, and all rules and regulations promulgated
pursuant thereto, and, in the case of an REO Property, such amounts shall be an
expense of the Trust Fund.
SECTION 3.23. Appointment of Special Servicer.
(a) Lennar Partners, Inc. is hereby appointed as the
initial Special Servicer to service each Specially Serviced Mortgage Loan.
(b) Certificateholders representing greater than 50% of
the Voting Rights of the most subordinate Class of Regular Certificates
outstanding at any time shall be entitled to remove the Special Servicer with
or without cause and to appoint a successor Special Servicer, provided that
each Rating Agency confirms to the Trustee in writing that such appointment
shall not, in and of itself, cause a withdrawal, downgrading or qualification
of the then-current ratings assigned to any Class of Certificates.
(c) The appointment of any such successor Special
Servicer shall not relieve the Servicer, the Trustee or the Fiscal Agent of
their respective obligations to make Advances as set forth herein. Any
termination fee payable to the terminated Special Servicer (and it is hereby
acknowledged that there is no such fee payable in the event of a termination of
Lennar Partners, Inc. as Special Servicer) shall be paid by the
Certificateholders so terminating the Special Servicer and shall not in any
event be an expense of the Trust Fund.
(d) No termination of the Special Servicer and
appointment of a successor Special Servicer shall be effective until the
successor Special Servicer has assumed all of its responsibilities, duties and
liabilities hereunder pursuant to a writing satisfactory to the Trustee and
each of the Rating Agencies confirms to the Trustee in writing that such
assumption shall not result, in and of itself, in a downgrading, withdrawal or
qualification of the rating then assigned by such Rating Agency to any Class of
the Certificates.
SECTION 3.24. Transfer of Servicing Between Servicer and Special Servicer;
Record Keeping.
(a) Upon determining that any Mortgage Loan has become a
Specially Serviced Mortgage Loan, the Servicer shall immediately give notice
thereof, together with a copy of the related Mortgage File, to the Special
Servicer and shall use its best efforts to provide the Special Servicer with
all information, documents (but excluding the original documents constituting
such Mortgage File) and records (including records stored electronically on
computer tapes, magnetic discs and the like) relating to such Mortgage Loan and
reasonably requested by the Special Servicer to enable it to assume its duties
hereunder with respect thereto
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without acting through a sub-servicer. The Servicer shall use its best efforts
to comply with the preceding sentence within five Business Days of the date
such Mortgage Loan became a Specially Serviced Mortgage Loan and in any event
shall continue to act as Servicer and administrator of such Mortgage Loan until
the Special Servicer has commenced the servicing of such Mortgage Loan, which
shall occur upon the receipt by the Special Servicer of the information,
documents and records referred to in the preceding sentence. With respect to
each Mortgage Loan that becomes a Specially Serviced Mortgage Loan, the
Servicer shall instruct the related Borrower to continue to remit all payments
in respect of such Mortgage Loan to the Servicer. If Midland Loan Services,
L.P. ceases to be the Servicer or Lennar Partners, Inc. ceases to be the
Special Servicer, the remaining party of the two and the successor Servicer or
Special Servicer, as applicable, may agree that, notwithstanding the preceding
sentence, with respect to each Mortgage Loan that became a Specially Serviced
Mortgage Loan, the Servicer shall instruct the related Borrower to remit all
payments in respect of such Mortgage Loan to the Special Servicer, provided
that the payee in respect of such payments shall remain the Servicer.
Upon determining that no event has occurred and is continuing
with respect to a Mortgage Loan that causes such Mortgage Loan to be a
Specially Serviced Mortgage Loan, the Special Servicer shall immediately give
notice thereof to the Servicer and upon giving such notice, such Mortgage Loan
shall cease to be a Specially Serviced Mortgage Loan pursuant to the proviso to
the definition of Specially Serviced Mortgage Loan, the Special Servicer's
obligation to service such Mortgage Loan shall terminate and the obligations of
the Servicer to service and administer such Mortgage Loan as a Mortgage Loan
that is not a Specially Serviced Mortgage Loan shall resume. In addition, if
the related Borrower has been instructed, pursuant to the last sentence of the
preceding paragraph, to make payments to the Special Servicer, upon such
determination, the Special Servicer shall instruct such Borrower to remit all
payments in respect of such Mortgage Loan that is no longer a Specially
Serviced Mortgage Loan directly to the Servicer.
(b) In servicing any Specially Serviced Mortgage Loan,
the Special Servicer shall provide to the Trustee originals of documents
included within the definition of "Mortgage File" for inclusion in the
related Mortgage File (to the extent such documents are in the possession of
the Special Servicer) and copies of any additional related Mortgage Loan
information, including correspondence with the related Borrower, and the
Special Servicer shall provide copies of all of the foregoing to the Servicer.
(c) Not later than the Business Day preceding each date
on which the Servicer is required to furnish a report under Section 3.13 to the
Trustee, the Special Servicer shall deliver to the Servicer a written statement
describing, on a Mortgage Loan-by-Mortgage Loan basis, (1) the amount of all
payments on account of interest received on each Specially Serviced Mortgage
Loan; the amount of all payments on account of principal, including Principal
Prepayments, on each Specially Serviced Mortgage Loan; the amount of Insurance
Proceeds and Liquidation Proceeds received with respect to each Specially
Serviced Mortgage Loan; and the amount of net income or net loss, as determined
for management of a trade or business on, or the furnishing or rendering of a
non-customary service to the tenants of, each REO Property that previously
secured a Specially Serviced Mortgage Loan, in each case in accordance with
Section
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3.17 and (2) such additional information relating to the Specially Serviced
Mortgage Loans as the Servicer reasonably requests to enable it to perform its
duties under this Agreement.
(d) Notwithstanding the provisions of the preceding
subsection (c), the Servicer shall maintain ongoing payment records with
respect to each of the Specially Serviced Mortgage Loans and shall provide the
Special Servicer with any information reasonably required by the Special
Servicer to perform its duties under this Agreement. The Special Servicer
shall provide the Servicer with any information reasonably required by the
Servicer to perform its duties under this Agreement.
SECTION 3.25. Adjustment of Servicing Compensation in Respect of Prepayment
Interest Shortfalls.
(a) The aggregate amount of the Prepayment Interest
Surplus and Servicing Fees (in that order) that the Servicer shall be entitled
to receive with respect to all of the Mortgage Loans on each Distribution Date
shall be offset on such Distribution Date by an amount equal to the aggregate
of the Prepayment Interest Shortfalls for such Distribution Date with respect
to all Mortgage Loans. The Servicer shall include the amount by which the
aggregate Servicing Fees and Prepayment Interest Surplus is offset pursuant to
this Section 3.25 as part of the Pooled Available Funds on such Distribution
Date. The amount of any offset against the aggregate Servicing Fees and
Prepayment Interest Surplus with respect to any Distribution Date under this
Section 3.25 shall be limited to the aggregate amount of the Servicing Fees and
Prepayment Interest Surplus otherwise payable to the Servicer on such
Distribution Date (without adjustment on account of Prepayment Interest
Shortfalls) and the rights of the Certificateholders to offset of the aggregate
Prepayment Interest Shortfalls shall not be cumulative. To the extent the
Servicer shall already have withdrawn or withheld Servicing Compensation
required to pay Prepayment Interest Shortfalls, the Servicer shall promptly
deposit in the Collection Amount such amounts to the extent required to pay
Prepayment Interest Shortfalls hereunder.
(b) To the extent that the Servicer and the Special
Servicer are the same Person, the aggregate amount of the Special Servicing
Fees that the Special Servicer shall be entitled to receive with respect to all
of the Specially Serviced Mortgage Loans on each Distribution Date shall be
offset on such Distribution Date by an amount equal to the excess of (X) the
aggregate of the Prepayment Interest Shortfalls for such Distribution Date with
respect to all Mortgage Loans over (Y) the amount of Servicing Fees offset
against such Prepayment Interest Shortfalls in accordance with Section 3.25(a).
The Servicer shall include the amount by which the aggregate Special Servicing
Fee is offset pursuant to this Section 3.25 as part of the Pooled Available
Funds on such Distribution Date. The amount of any offset against the
aggregate Special Servicing Fee with respect to any Distribution Date under
this Section 3.25 shall be limited to the aggregate amount of the Special
Servicing Fees otherwise payable to the Special Servicer on such Distribution
Date (without adjustment on account of Prepayment Interest Shortfalls) and the
rights of the Certificateholders to offset of the aggregate Prepayment Interest
Shortfalls shall not be cumulative.
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SECTION 3.26. Extension Advisor.
The Special Servicer shall obtain the prior written approval
of the Extension Advisor in respect of any proposed modification of a Mortgage
Loan pursuant to Section 3.10(a) with respect to which three successive
extensions shall have already been granted. The Special Servicer shall advise
the Extension Advisor in a written report (in reasonable detail) if any such
modification after the third successive previous extension of such Mortgage
Loan with respect to a Specially Serviced Mortgage Loan is proposed and the
Special Servicer shall grant such extension only if the Extension Advisor
approves such extension in writing.
The Extension Advisory Fee shall be paid to the Extension
Advisor, first from loan modification fees paid by the Borrower under the
related Mortgage Loan as to which an extension was requested, and, to the
extent that such loan modification fees are insufficient to pay the Extension
Advisory Fee, any such shortfall shall be paid from the Servicing Compensation;
provided that the reduction in Servicing Compensation shall be allocated
equally between the Servicer and the Special Servicer.
The Extension Advisor may be replaced at any time by the
Holders of 66-2/3% of the Voting Rights allocated to each Class of Regular
Certificates, other than the most subordinate such Class of Regular
Certificates, by written notice to the Extension Advisor, the Trustee and the
Special Servicer. Notwithstanding anything to the contrary contained herein,
in no event shall the Special Servicer be the Extension Advisor.
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ARTICLE IV
DISTRIBUTIONS TO CERTIFICATEHOLDERS
SECTION 4.1. Distributions.
(a) (I) On each Remittance Date, to the extent of Pooled Available
Funds, amounts held in the Collection Account shall be withdrawn and remitted to
the Trustee for deposit in the Distribution Account in the following amounts:
(i) First, pro rata (A) to the Class A-L-1 Interest in
respect of interest, (1) the Interest Distribution
Amount therefor, and (2) the aggregate unpaid
Interest Shortfalls allocated to the Class A-L-1
Interest on any prior Distribution Date; (B) to the
Class A-L-2 Interest in respect of interest, (1) the
Interest Distribution Amount therefor, and (2) the
aggregate unpaid Interest Shortfalls allocated to the
Class A-L-2 Interest on any prior Distribution Date;
(C) to the Class B-L Interest in respect of interest,
(1) the portion of the Interest Distribution Amount
therefor that is in excess of interest thereon at the
Class B Pass-Through Rate and (2) a proportionate
amount of any unpaid Interest Shortfalls allocated to
the Class B-L Interest on any prior Distribution
Date; (D) to the Class C-L Interest in respect of
interest, (1) the portion of the Interest
Distribution Amount therefor that is in excess of
interest thereon at the Class C Pass-Through Rate and
(2) a proportionate amount of any unpaid Interest
Shortfalls allocated to the Class C-L Interest on any
prior Distribution Date; (E) to the Class D-L
Interest in respect of interest, (1) the portion of
the Interest Distribution Amount therefor that is in
excess of interest thereon at the Class D
Pass-Through Rate and (2) a proportionate amount of
any unpaid Interest Shortfalls allocated to the Class
D-L Interest on any prior Distribution Date; and (F)
to the Class E-L Interest in respect of interest, (1)
the portion of the Interest Distribution Amount
therefor that is in excess of interest thereon at the
Class E Pass-Through Rate and (2) a proportionate
amount of any unpaid Interest Shortfalls allocated to
the Class E-L Interest on any prior Distribution
Date;
(ii) Second, to the Class A-L-1 Interest, in reduction of
the Certificate Balance thereof, the Pooled Principal
Distribution Amount for such Distribution Date, until
the Certificate Balance thereof is reduced to zero;
(iii) Third, to the Class A-L-1 Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple
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interest thereon at a rate equal to 10.00% per annum
from the date on which such unreimbursed Realized
Loss was allocated (or the date on which interest was
last paid) to, but not including, the Distribution
Date following the Remittance Date on which
distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph,
up to an amount equal to the aggregate of such
unreimbursed Realized Losses previously allocated to
such Lower-Tier Regular Interest and interest
thereon, provided that any distribution pursuant to
this subparagraph shall be deemed to be distributed
first in respect of any such interest and then in
respect of any such unreimbursed Realized Loss;
(iv) Fourth, to the Class A-L-2 Interest, in reduction of
the Certificate Balance thereof, the Pooled Principal
Distribution Amount for such Distribution Date, until
the Certificate Balance thereof is reduced to zero;
(v) Fifth, to the Class A-L-2 Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
(vi) Sixth, to the Class B-L Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class B Pass-Through Rate and
(B) a proportionate amount of the aggregate unpaid
Interest Shortfalls allocated to the Class B-L
Interest on any prior Distribution Date;
(vii) Seventh, after the Certificate Balance of the Class
A-L Interest has been reduced to zero, to the Class
B-L Interest, in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution Amount
less the portion thereof distributed on such
Distribution Date pursuant to any preceding
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clause, until the Certificate Balance of the Class
B-L Interest is reduced to zero;
(viii) Eighth, to the Class B-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
(ix) Ninth, to the Class C-L Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class C Pass-Through Rate and
(B) a proportionate amount of the aggregate unpaid
Interest Shortfalls allocated to the Class C-L
Interest on any prior Distribution Date;
(x) Tenth, after the Certificate Balance of the Class B-L
Interest has been reduced to zero, to the Class C-L
Interest, in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution Amount
less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class C-L
Interest is reduced to zero;
(xi) Eleventh, to the Class C-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect
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of any such interest and then in respect of any such
unreimbursed Realized Loss;
(xii) Twelfth, to the Class D-L Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class D Pass-Through Rate and
(B) a proportionate amount of the aggregate unpaid
Interest Shortfalls allocated to the Class D-L
Interest on any prior Distribution Date;
(xiii) Thirteenth, after the Certificate Balance of the
Class C-L Interest has been reduced to zero, to the
Class D-L Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class D-L
Interest is reduced to zero;
(xiv) Fourteenth, to the Class D-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
(xv) Fifteenth, to the Class E-L Interest, in respect of
interest, (A) the portion of the Interest
Distribution Amount therefor that is equal to
interest thereon at the Class E Pass-Through Rate and
(B) a proportionate amount of the aggregate unpaid
Interest Shortfalls allocated to the Class E-L
Interest on any prior Distribution Date;
(xvi) Sixteenth, after the Certificate Balance of the Class
D-L Interest has been reduced to zero, to the Class
E-L Interest, in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution Amount
less the portion thereof distributed on such
Distribution Date pursuant to any preceding
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clause, until the Certificate Balance of the Class
E-L Interest is reduced to zero;
(xvii) Seventeenth, to the Class E-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
(xviii) Eighteenth, to the Class F-L Interest, in respect of
interest, (A) the Interest Distribution Amount
therefor and (B) the aggregate unpaid Interest
Shortfalls allocated to the Class F-L Interest on any
prior Distribution Date;
(xix) Nineteenth, after the Certificate Balance of the
Class E-L Interest has been reduced to zero, to the
Class F-L Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class F-L
Interest is reduced to zero;
(xx) Twentieth, to the Class F-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
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(xxi) Twenty-First, to the Class G-L Interest, in respect
of interest, (A) the Interest Distribution Amount
therefor and (B) the aggregate unpaid Interest
Shortfalls allocated to the Class G-L Interest on any
prior Distribution Date;
(xxii) Twenty-Second, after the Certificate Balance of the
Class F-L Interest has been reduced to zero, to the
Class G-L Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class G-L
Interest is reduced to zero;
(xxiii) Twenty-Third, to the Class G-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
(xxiv) Twenty-Fourth, to the Class H-L Interest, in respect
of interest, (A) the Interest Distribution Amount
therefor and (B) the aggregate unpaid Interest
Shortfalls allocated to the Class H-L Interest on any
prior Distribution Date;
(xxv) Twenty-Fifth, after the Certificate Balance of the
Class G-L Interest has been reduced to zero, to the
Class H-L Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class H-L
Interest is reduced to zero;
(xxvi) Twenty-Sixth, to the Class H-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
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<PAGE> 105
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interest and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
(xxvii) Twenty-Seventh, to the Class J-L Interest, in respect
of interest, (A) the Interest Distribution Amount
therefor and (B) the aggregate unpaid Interest
Shortfalls allocated to the Class J-L Interest on any
prior Distribution Date;
(xxviii) Twenty-Eighth, after the Certificate Balance of the
Class H-L Interest has been reduced to zero, to the
Class J-L Interest, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount less the portion thereof distributed on such
Distribution Date pursuant to any preceding clause,
until the Certificate Balance of the Class J-L
Interest is reduced to zero;
(xxix) Twenty-Ninth, if such Remittance Date occurs after
the EC Maturity Date, to (i)the Class H-L Interest,
(ii) the Class G-L Interest, (iii) the Class F-L
Interest, (iv) the Class E-L Interest, (v) the Class
D-L Interest, (vi) the Class C-L Interest, (vii) the
Class B-L Interest, (viii) the Class A-L-2 Interest,
(ix) the Class A-L-1 Interest, and (x) the Class J-L
Interest, in that order, in reduction of the
Certificate Balance of each thereof, any remaining
portion of Pooled Available Funds in the Collection
Account, until the Certificate Balance of each has
been reduced to zero; and
(xxx) Thirtieth, to the Class J-L Interest, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date following the
Remittance Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to such Lower-Tier Regular
Interests and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect
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<PAGE> 106
of any such interest and then in respect of any such
unreimbursed Realized Loss; and
(xxxi) Thirty-First, to the Class LR Certificates, any
Pooled Available Funds remaining in the Collection
Account.
(II) On each Remittance Date, the Trustee shall receive for deposit
into the Distribution Account in respect of each Lower-Tier Regular Interest,
distributions from amounts on deposit in the Collection Account in respect of
Prepayment Premiums, if any, distributable to its Related Certificate (or (i) in
the case of the Class A-L-1 Interest, amounts distributable to the Class A-1
Certificates and (ii) in the case of the Class A-L-2 Interest, amounts
distributable to the Class A-2 Certificates) pursuant to Section 4.1(c)(I).
(b) (I) On each Distribution Date, to the extent of amounts remitted
to the Distribution Account pursuant to Section 4.1(a)(I), Holders of each Class
of Certificates (other than the Class LR Certificates) shall receive
distributions from amounts on deposit in the Distribution Account, up to the
Pooled Available Funds for such Distribution Date, in the amounts and in the
order of priority set forth below:
(i) First, to the Class A-1 Certificates, Class A-2
Certificates and Class A-EC Certificates, pro rata in
accordance with the Class Interest Distribution Amount
of each, up to an amount equal to the Class Interest
Distribution Amount of each such Class for such
Distribution Date;
(ii) Second, to the Class A-1 Certificates, Class A-2
Certificates and Class A-EC Certificates, pro rata in
accordance with the Class Interest Shortfall of each, up
to an amount equal to the aggregate unpaid Class
Interest Shortfalls previously allocated to such Class
on any previous Distribution Dates and not paid;
(iii) Third, to the Class A-1 Certificates, in reduction of
the Certificate Balance thereof, the Pooled Principal
Distribution Amount for such Distribution Date, until
the Certificate Balance thereof is reduced to zero;
(iv) Fourth, after the Certificate Balance of the Class A-1
Certificates has been reduced to zero, to the Class A-2
Certificates, in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution Amount for
such Distribution Date, until the Certificate Balance
thereof is reduced to zero;
(v) Fifth, to the Class A-1 Certificates and the Class A-2
Certificates, pro rata, for the unreimbursed amounts of
Realized Losses, if any, together with simple interest
thereon at a rate equal to 10.00% per annum from the
date on which such unreimbursed Realized Loss
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was allocated (or the date on which interest was last
paid) to, but not including, the Distribution Date on
which distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph, up
to an amount equal to the aggregate of such unreimbursed
Realized Losses previously allocated to the Class A-1
Certificates and the Class A-2 Certificates and interest
thereon, provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed first in
respect of any such interest and then in respect of any
such unreimbursed Realized Loss;
(vi) Sixth, to the Class B Certificates, up to an amount
equal to the Class Interest Distribution Amount of such
Class for such Distribution Date;
(vii) Seventh, to the Class B Certificates, up to an amount
equal to the aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any previous
Distribution Dates and not paid;
(viii) Eighth, after the Certificate Balance of the Class A-2
Certificates has been reduced to zero, to the Class B
Certificates, in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution Amount for
such Distribution Date less the portion thereof
distributed on such Distribution Date pursuant to any
preceding clause, until the Certificate Balance thereof
is reduced to zero;
(ix) Ninth, to the Class B Certificates, for the unreimbursed
amounts of Realized Losses, if any, together with simple
interest thereon at a rate equal to 10.00% per annum
from the date on which such unreimbursed Realized Loss
was allocated (or the date on which interest was last
paid) to, but not including, the Distribution Date on
which distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph, up
to an amount equal to the aggregate of such unreimbursed
Realized Losses previously allocated to the Class B
Certificates and interest thereon, provided that any
distribution pursuant to this subparagraph shall be
deemed to be distributed first in respect of any such
interest and then in respect of any such unreimbursed
Realized Loss;
(x) Tenth, to the Class C Certificates, up to an amount
equal to the Class Interest Distribution Amount of such
Class for such Distribution Date;
(xi) Eleventh, to the Class C Certificates, up to an amount
equal to the aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any previous
Distribution Dates and not paid;
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(xii) Twelfth, after the Certificate Balance of the Class B
Certificates has been reduced to zero, to the Class C
Certificates, in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution Amount for
such Distribution Date less the portion thereof
distributed on such Distribution Date pursuant to any
preceding clause, until the Certificate Balance thereof
is reduced to zero;
(xiii) Thirteenth, to the Class C Certificates, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal to
10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date on
which interest was last paid) to, but not including, the
Distribution Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to the Class C Certificates and
interest thereon, provided that any distribution
pursuant to this subparagraph shall be deemed to be
distributed first in respect of any such interest and
then in respect of any such unreimbursed Realized Loss;
(xiv) Fourteenth, to the Class D Certificates, up to an amount
equal to the Class Interest Distribution Amount of such
Class for such Distribution Date;
(xv) Fifteenth, to the Class D Certificates, up to an amount
equal to the aggregate unpaid Class Interest Shortfalls
previously allocated to such Class on any previous
Distribution Dates and not paid;
(xvi) Sixteenth, after the Certificate Balance of the Class C
Certificates has been reduced to zero, to the Class D
Certificates, in reduction of the Certificate Balance
thereof, the Pooled Principal Distribution Amount for
such Distribution Date less the portion thereof
distributed on such Distribution Date pursuant to any
preceding clause, until the Certificate Balance thereof
is reduced to zero;
(xvii) Seventeenth, to the Class D Certificates, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal to
10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date on
which interest was last paid) to, but not including, the
Distribution Date on which distributions in respect of
such unreimbursed Realized Loss are made pursuant to
this subparagraph, up to an amount equal to the
aggregate of such unreimbursed Realized Losses
previously allocated to the Class D Certificates and
interest thereon, provided that any distribution
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<PAGE> 109
pursuant to this subparagraph shall be deemed to be
distributed first in respect of any such interest and
then in respect of any such unreimbursed Realized
Loss;
(xviii) Eighteenth, to the Class E Certificates, up to an
amount equal to the Class Interest Distribution
Amount of such Class for such Distribution Date;
(xix) Nineteenth, to the Class E Certificates, up to an
amount equal to the aggregate unpaid Class Interest
Shortfalls previously allocated to such Class on any
previous Distribution Dates and not paid;
(xx) Twentieth, after the Certificate Balance of the Class
D Certificates has been reduced to zero, to the Class
E Certificates, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount for such Distribution Date less the portion
thereof distributed on such Distribution Date
pursuant to any preceding clause, until the
Certificate Balance thereof is reduced to zero;
(xxi) Twenty-First, to the Class E Certificates, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date on which
distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph,
up to an amount equal to the aggregate of such
unreimbursed Realized Losses previously allocated to
the Class E Certificates and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed first
in respect of any such interest and then in respect
of any such unreimbursed Realized Loss;
(xxii) Twenty-Second, to the Class F Certificates, up to an
amount equal to the Class Interest Distribution
Amount of such Class for such Distribution Date;
(xxiii) Twenty-Third, to the Class F Certificates, up to an
amount equal to the aggregate unpaid Class Interest
Shortfalls previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxiv) Twenty-Fourth, after the Certificate Balance of the
Class E Certificates has been reduced to zero, to the
Class F Certificates, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount for such Distribution Date less the
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<PAGE> 110
portion thereof distributed on such Distribution Date
pursuant to any preceding clause, until the
Certificate Balance thereof is reduced to zero;
(xxv) Twenty-Fifth, to the Class F Certificates, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date on which
distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph,
up to an amount equal to the aggregate of such
unreimbursed Realized Losses previously allocated to
the Class F Certificates and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed first
in respect of any such interest and then in respect
of any such unreimbursed Realized Loss;
(xxvi) Twenty-Sixth, to the Class G Certificates, up to an
amount equal to the Class Interest Distribution
Amount of such Class for such Distribution Date;
(xxvii) Twenty-Seventh, to the Class G Certificates, up to an
amount equal to the aggregate unpaid Class Interest
Shortfalls previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxviii) Twenty-Eighth, after the Certificate Balance of the
Class F Certificates has been reduced to zero, to the
Class G Certificates, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount for such Distribution Date less the portion
thereof distributed on such Distribution Date
pursuant to any preceding clause, until the
Certificate Balance thereof is reduced to zero;
(xxix) Twenty-Ninth, to the Class G Certificates, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date on which
distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph,
up to an amount equal to the aggregate of such
unreimbursed Realized Losses previously allocated to
the Class G Certificates and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be
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distributed first in respect of any such interest and
then in respect of any such unreimbursed Realized
Loss;
(xxx) Thirtieth, to the Class H Certificates, up to an
amount equal to the Class Interest Distribution
Amount of such Class for such Distribution Date;
(xxxi) Thirty-First, to the Class H Certificates, up to an
amount equal to the aggregate unpaid Class Interest
Shortfalls previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxxii) Thirty-Second, after the Certificate Balance of the
Class G Certificates has been reduced to zero, to the
Class H Certificates, in reduction of the Certificate
Balance thereof, the Pooled Principal Distribution
Amount for such Distribution Date less the portion
thereof distributed on such Distribution Date
pursuant to any preceding clause, until the
Certificate Balance thereof is reduced to zero;
(xxxiii) Thirty-Third, to the Class H Certificates, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date on which
distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph,
up to an amount equal to the aggregate of such
unreimbursed Realized Losses previously allocated to
the Class H Certificates and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed first
in respect of any such interest and then in respect
of any such unreimbursed Realized Loss;
(xxxiv) Thirty-Fourth, to the Class J-2 Certificates, up to
an amount equal to the Class Interest Distribution
Amount of such Class for such Distribution Date;
(xxxv) Thirty-Fifth, to the Class J-2 Certificates, up to an
amount equal to the aggregate unpaid Class Interest
Shortfalls previously allocated to such Class on any
previous Distribution Dates and not paid;
(xxxvi) Thirty-Sixth, after the Certificate Balance of the
Class H Certificates has been reduced to zero, to the
Class J-1 Certificates, in reduction of the
Certificate Balance thereof, the
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Pooled Principal Distribution Amount for such
Distribution Date less the portion thereof
distributed on such Distribution Date pursuant to any
preceding clause, until the Certificate Balance
thereof is reduced to zero;
(xxxvii) Thirty-Seventh, if such Distribution Date occurs
after the EC Maturity Date, to (i) the Class H
Certificates, (ii) the Class G Certificates, (iii)
the Class F Certificates, (iv) the Class E
Certificates, (v) the Class D Certificates, (vi) the
Class C Certificates, (vii) the Class B Certificates,
(viii) the Class A-2 Certificates and the Class Class
A-1 Certificates, pro rata, and (x) the Class J-1
Certificates, in that order, in reduction of the
Certificate Balance of each thereof, any remaining
portion of Pooled Available Funds in the Distribution
Account, until the Certificate Balance of each has
been reduced to zero; and
(xxxviii) Thirty-Eighth, to the Class J-1 Certificates, for the
unreimbursed amounts of Realized Losses, if any,
together with simple interest thereon at a rate equal
to 10.00% per annum from the date on which such
unreimbursed Realized Loss was allocated (or the date
on which interest was last paid) to, but not
including, the Distribution Date on which
distributions in respect of such unreimbursed
Realized Loss are made pursuant to this subparagraph,
up to an amount equal to the aggregate of such
unreimbursed Realized Losses previously allocated to
the Class J-1 Certificates and interest thereon,
provided that any distribution pursuant to this
subparagraph shall be deemed to be distributed first
in respect of any such interest and then in respect
of any such unreimbursed Realized Loss.
All references to pro rata in the preceding clauses shall mean pro rata based on
the amount distributable pursuant to such clause.
Notwithstanding anything to the contrary in this Agreement, on each
Distribution Date prior to the earlier of (i) the Senior Principal Distribution
Cross-Over Date and (ii) the final Distribution Date in connection with the
termination of the Trust Fund, all distributions of principal to the Class A-1
Certificates and the Class A-2 Certificates will be paid, first, to holders of
the Class A-1 Certificates until the Certificate Balance of such Certificates is
reduced to zero, and thereafter, to holders of the Class A-2 Certificates, until
the Certificate Balance of such Certificates is reduced to zero. On each
Distribution Date on and after the Senior Principal Distribution Cross-Over
Date, and in any event on the final Distribution Date in connection with the
termination of the Trust Fund, distributions of principal on the Class A-1
Certificates and the Class A-2 Certificates will be paid to holders of such two
Class of Certificates, pro rata in accordance with their respective Certificate
Balances outstanding immediately prior to such Distribution Date, until the
Certificate Balance of each such Class of Certificates is reduced to zero.
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(II) On each Distribution Date, amounts remaining in the
Distribution Account following the distributions to the Certificates pursuant to
Section 4.1(b) and (c) shall be distributed to the Class R Certificates.
(c) On each Distribution Date, following the distribution from the
Collection Account to the Distribution Account pursuant to Section 4.1(a)(II),
the Paying Agent shall make distributions of Prepayment Premiums with respect to
any Principal Prepayments received in the related Collection Period from amounts
deposited in the Distribution Account pursuant to Section 4.6(b)(i) as follows:
(I) On each Distribution Date up to and including the EC Maturity
Date, Prepayment Premiums received with respect to Yield Maintenance Loans
during the Yield Maintenance Period for such Yield Maintenance Loans, shall be
distributed to the Holders of the Certificates outstanding on such Distribution
Date, in the following amounts and order of priority:
(i) First, to the Class of Certificates which is entitled to
distributions in respect of principal on such Distribution Date (other
than pursuant to clause thirty-seventh of Section 4.1(b)(I)), an amount
equal to (A) the present value (discounted at the Discount Rate) of the
principal and interest distributions that would have been paid in respect
of such Class of Certificates from the Distribution Date occurring in the
following month until the Certificate Balance of such Class of
Certificates would have been reduced to zero had the related prepayment
not occurred (and assuming no other prepayments were made), less (B) the
present value (discounted at the Discount Rate) of the principal and
interest distributions that will be paid in respect of such Class of
Certificates from the Distribution Date occurring in the following month
until the Certificate Balance of such Class of Certificates is reduced to
zero following such prepayment (assuming no further prepayments are made
and no delinquencies or defaults occur) less (C) the amount of such
prepayment; provided that if more than one Class of Certificates is
entitled to distributions in respect of principal on such Distribution
Date (other than pursuant to clause thirty-seventh of Section 4.1(b)(I)),
the amount set forth herein shall be calculated for each such Class, and
the amount of Prepayment Premiums shall be allocated among such Classes,
pro rata in accordance with the amounts so calculated, up to an amount
equal to the sum of such amounts so calculated; and
(ii) Second, any remaining Prepayment Premiums following the
distribution in clause First above, to the Class A-EC Certificates.
(II) With respect to each Distribution Date up to and including the
EC Maturity Date, any Prepayment Premiums received with respect to any Mortgage
Loan that is not a Yield Maintenance Loan and any Prepayment Premiums received
with respect to any Yield Maintenance Loan after the related Yield Maintenance
Period will be allocated solely to the Class A-EC Certificates.
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(III) The Servicer will be entitled to receive as additional
Servicing Compensation amount of any Prepayment Premiums received in any
Collection Period subsequent to the Collection Period related to the EC Maturity
Date.
(IV) Notwithstanding the foregoing, Prepayment Premiums shall be
distributed on any Distribution Date only to the extent they are received in
respect of the Mortgage Loans in the related Collection Period.
(d) The Certificate Balances of the Lower-Tier Regular Interests
will be reduced without distribution on any Distribution Date as a write-off to
the extent of any Realized Losses with respect to such date. Any such write-offs
will be applied to the Lower Tier Regular Interests: first, to the Class J-L
Interest; second, to the Class H-L Interest; third, to the Class G-L Interest;
fourth, to the Class F-L Interest; fifth, to the Class E-L Interest; sixth, to
the Class D-L Interest; seventh, to the Class C-L Interest; eighth, to the Class
B-L Interest; and ninth, to the Class A-L-1 Interest and the Class A-L-2
Interest, pro rata.
The Certificate Balances of the Certificates (other than the Class A-EC, Class
J-2, Class R and Class LR Certificates) will be reduced without distribution on
any Distribution Date, as a write-off, to the extent that, after allocation of
Realized Losses in accordance with the preceding sentence, the Certificate
Balance of any Class of Certificates exceeds the Certificate Balance of its
Related Lower-Tier Regular Interest.
(e) All amounts distributable to a Class of Certificates pursuant to
this Section 4.1 on each Distribution Date shall be allocated pro rata among the
outstanding Certificates in each such Class based on their respective Percentage
Interests. Such distributions shall be made on each Distribution Date other than
the Termination Date to each Certificateholder of record on the related Record
Date by check mailed by first class mail to the address set forth therefor in
the Certificate Register or, provided that such Certificateholder holds
Certificates with an aggregate initial Certificate Balance, Class A-EC Notional
Balance or Class J-2 Notional Balance in excess of $5,000,000, and shall have
provided the Paying Agent with wire instructions in writing at least five
Business Days prior to the related Record Date, by wire transfer of immediately
available funds to the account of such Certificateholder at a bank or other
entity located in the United States and having appropriate facilities therefor.
The final distribution on each Certificate shall be made in like manner, but
only upon presentment and surrender of such Certificate at the office of the
Trustee or its agent (which may be the Paying Agent or the Certificate Registrar
acting as such agent) maintained in the Borough of Manhattan that is specified
in the notice to Certificateholders of such final distribution.
(f) Except as otherwise provided in Section 9.1 with respect to an
Anticipated Termination Date, the Trustee shall, no later than the fifteenth day
of the month in the month preceding the Distribution Date on which the final
distribution with respect to any Class of Certificates is expected to be made or
such later day as the Trustee becomes aware that the final distribution with
respect to any Class of Certificates is expected to be made on the succeeding
Distribution Date, mail to each Holder of such Class of Certificates, on such
day a notice to the effect that:
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(A) the Trustee reasonably expects, based upon information
previously provided to it, that the final distribution with
respect to such Class of Certificates will be made on such
Distribution Date, but only upon presentation and surrender of
such Certificates at the office of the Trustee therein
specified; and
(B) if such final distribution is made on such Distribution Date,
no interest shall accrue on such Certificates from and after
such Distribution Date;
provided, however, that the Class R and Class LR Certificates shall remain
outstanding until there is no other Class of Certificates or Lower-Tier Regular
Interests outstanding.
Any funds not distributed to any Holder or Holders of Certificates
of such Class on such Distribution Date because of the failure of such Holder or
Holders to tender their Certificates shall, on such Distribution Date, be set
aside and held in trust for the benefit of the appropriate non-tendering Holder
or Holders. If any Certificates as to which notice has been given pursuant to
this Section 4.1(f) shall not have been surrendered for cancellation within six
months after the time specified in such notice, the Trustee shall mail a second
notice to the remaining non-tendering Certificateholders, at their last
addresses shown in the Certificate Register, to surrender their Certificates for
cancellation in order to receive from such funds held the final distribution
with respect thereto. If, within one year after the second notice, any of such
Certificates shall not have been surrendered for cancellation, the Trustee may,
directly or through an agent, take appropriate steps to contact the remaining
nontendering Certificateholders concerning surrender of their Certificates. The
costs and expenses of maintaining such funds in trust and of contacting such
Certificateholders shall be paid out of such funds. If, within two years after
the second notice, any such Certificates shall not have been surrendered for
cancellation, the Paying Agent shall pay to the Trustee all amounts
distributable to the Holders thereof, and the Trustee shall thereafter hold such
amounts for the benefit of such Holders until the earlier of (i) its termination
as Trustee hereunder and the transfer of such amounts to a successor Trustee and
(ii) the termination of the Trust Fund and distribution of such amounts to the
Class LR Certificateholders. No interest shall accrue or be payable to any
Certificateholder on any amount held in trust hereunder or by the Trustee as a
result of such Certificateholder's failure to surrender its Certificate(s) for
final payment thereof in accordance with this Section 4.1(f). Any such amounts
transferred to the Trustee may be invested in Permitted Investments and all
income and gain realized from investment of such funds shall be for the benefit
of the Trustee. In the event the Trustee is permitted or required to invest any
amounts in Permitted Investments under this Agreement, whether in its capacity
as Trustee or in the event of its assumption of the duties of, or becoming the
successor to, the Servicer in accordance with the terms of this Agreement, it
shall invest such amounts in the following Permitted Investments and priority,
in each case only for so long as any such investment shall continue to be a
Permitted Investment: (1) Associates Corp. of North America Demand Notes, (2)
GECC Demand Notes, (3) Dreyfus Treasury Prime Cash Management Plus and (4) if
none of (1)-(3) above are available, Permitted Investments under clause (i) of
the definition of Permitted Investments. The Trustee shall indemnify the related
Certificateholders against any loss incurred in respect of any such Permitted
Investment immediately upon realization of such loss.
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(g) Notwithstanding any provision in this Agreement to the contrary,
the aggregate amount distributable to each Class pursuant to this Section 4.1
shall be reduced by the aggregate amount paid to any Person pursuant to Section
6.3 or Section 8.5(d), such reduction to be allocated among such Classes pro
rata, based upon the respective amounts so distributable without taking into
account the provision of this Section 4.1(g). Such reduction of amounts
otherwise distributable to a Class shall be allocated first in respect of
interest and second in respect of principal. For purposes of determining
Interest Shortfalls and Certificate Balances, the amount of any such reduction
so allocated to a Class shall be deemed to have been distributed to such Class.
SECTION 4.2. Statements to Rating Agencies and Certificateholders;
Available Information; Information Furnished to
Financial Market Publisher.
(a) On each Distribution Date, the Trustee shall prepare and forward
by mail to each Rating Agency and each Holder of a Certificate, with copies to
the Depositor, Paying Agent, Servicer and Special Servicer, a statement as to
such distribution setting forth for each Class, as applicable:
(i) Principal Distribution Amount and the amount allocable to
principal included in Pooled Available Funds;
(ii) The Class Interest Distribution Amount distributable to such
Class and the amount of Pooled Available Funds allocable
thereto, together with any Class Interest Shortfall allocable
to such Class;
(iii) The amount of any P&I Advances by the Servicer, the Trustee or
the Fiscal Agent included in the amounts distributed to such
Certificateholder;
(iv) The Certificate Balance of each Class of Certificates after
giving effect to the distribution of amounts in respect of the
Pooled Principal Distribution Amount on such Distribution
Date;
(v) Realized Losses and their allocation to the Certificate
Balance of any Class of Certificates;
(vi) The Scheduled Principal Balance of the Mortgage Loans as of
the Due Date preceding such Distribution Date;
(vii) The number and aggregate principal balance of Mortgage Loans
(A) delinquent one month, (B) delinquent two months, (C)
delinquent three or more months, (D) as to which foreclosure
proceedings have been commenced and (E) that otherwise
constitute Specially Serviced Mortgage Loans, and, with
respect to each Specially Serviced Mortgage Loan, the amount
of Property Advances made during the related Collection
Period, the amount of the P&I Advance made on such
Distribution Date, the
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aggregate amount of Property Advances theretofore made that
remain unreimbursed and the aggregate amount of P&I Advances
theretofore made that remain unreimbursed;
(viii) With respect to any Mortgage Loan that became an REO Mortgage
Loan during the preceding calendar month, the principal
balance of such Mortgage Loan as of the date it became an REO
Mortgage Loan;
(ix) As of the Due Date preceding such Distribution Date, as to any
REO Property sold during the related Collection Period, the
date on which the Special Servicer made a Final Recovery
Determination and the amount of the proceeds of such sale
deposited into the Collection Account, and the aggregate
amount of REO Proceeds and Net REO Proceeds (in each case
other than Liquidation Proceeds) and other revenues collected
by the Special Servicer with respect to each REO Property
during the related Collection Period and credited to the
Collection Account, in each case identifying such REO Property
by name;
(x) The outstanding principal balance of each REO Mortgage Loan as
of the close of business on the immediately preceding Due Date
and the appraised value of the related REO Property per the
most recent Updated Appraisal obtained;
(xi) The amount of the Servicing Compensation paid to the Servicer
with respect to such Distribution Date, and the amount of the
additional servicing compensation described in Section 3.12(a)
that was paid to the Servicer with respect to such
Distribution Date;
(xii) The amount of any Special Servicing Fee or Disposition Fee
paid to the Special Servicer with respect to such Distribution
Date; and
(xiii) (A) The amount of Prepayment Premiums, if any, received during
the related Collection Period, and (B) the amount of Default
Interest received during the related Collection Period and the
Net Default Interest for such Distribution Date.
In the case of information furnished pursuant to subclauses (i),
(ii), (iii) and (xiii)(A) above, the amounts shall be expressed as a dollar
amount in the aggregate for all Certificates of each applicable Class and for
each Class of Certificates for a denomination of $1,000 initial Certificate
Balance or Notional Balance.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to each Person who at any time during the
calendar year was a Holder of a Certificate (except for a Class R or Class LR
Certificate) and to each Rating Agency a statement containing the information
set forth in subclauses (i) and (ii) above, aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such
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obligation of the Trustee shall be deemed to have been satisfied to the extent
that it provided substantially comparable information pursuant to any
requirements of the Code as from time to time in force.
On each Distribution Date, the Trustee shall forward to each Holder
of a Class R or Class LR Certificate a copy of the reports forwarded to the
other Certificateholders on such Distribution Date and a statement setting forth
the amounts, if any, actually distributed with respect to the Class R or Class
LR Certificates on such Distribution Date.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to each Person who at any time during the
calendar year was a Holder of a Class R or Class LR Certificate a statement
containing the information provided pursuant to the previous paragraph
aggregated for such calendar year or applicable portion thereof during which
such Person was a Certificateholder. Such obligation of the Trustee shall be
deemed to have been satisfied to the extent that it provided substantially
comparable information pursuant to any requirements of the Code as from time to
time in force.
In addition to the reports required to be delivered pursuant to this
Section 4.2(a), the Trustee shall make available upon request to each proposed
transferee of a Privately Placed Certificate such additional information, if
any, in its possession as may be required to permit the proposed transfer to be
effected pursuant to Rule 144A.
(b) On or within two Business Days following each Distribution Date,
the Trustee shall prepare and furnish to the Financial Market Publisher and the
Placement Agent, using the format and media mutually agreed upon by the Trustee,
the Financial Market Publisher and the Placement Agent, the following
information regarding each Mortgage Loan and any other information reasonably
requested by the Placement Agent and available to the Trustee:
(i) an identifying loan number;
(ii) the Mortgage Rate; and
(iii) the principal balance as of such Distribution Date.
The Trustee shall only be obligated to deliver the statements, reports and
information contemplated by Section 4.2(a) and 4.2(b) to the extent it receives
the necessary underlying information from the Servicer and shall not be liable
for any failure to deliver any thereof on the prescribed Due Dates, to the
extent such failure is caused by the Servicer's failure to deliver such
underlying information in a timely manner. Nothing herein shall obligate the
Trustee, the Servicer or the Special Servicer to violate (in the reasonable
judgment of the Servicer, the Special Servicer or the Trustee, as appropriate)
any applicable law or provision of any Mortgage Loan document prohibiting
disclosure of information with respect to any Borrower and the failure of the
Trustee, the Servicer or the Special Servicer to disseminate information for
such reason shall not be a breach hereof.
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SECTION 4.3. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the Paying
Agent shall comply with all federal withholding requirements with respect to
payments to Certificateholders of interest or original issue discount that the
Paying Agent reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for any such withholding. The Paying
Agent agrees that it will not withhold with respect to payments of interest or
original issue discount in the case of a Certificateholder that is a non-U.S.
Person that has furnished or caused to be furnished (i) an effective Form W-8 or
Form W-9 or an acceptable substitute form or a successor form and who has
informed the Trustee in writing that it is not a "10-percent shareholder" within
the meaning of Code Section 871(h)(3)(B) or a "controlled foreign corporation"
described in Code Section 881(c)(3)(C) with respect to the Trust Fund or the
Depositor, or (ii) an effective Form 4224 or an acceptable substitute form or a
successor form. In the event the Paying Agent or its agent withholds any amount
from interest or original issue discount payments or advances thereof to any
Certificateholder pursuant to federal withholding requirements, the Paying Agent
shall indicate the amount withheld to such Certificateholder. Any amount so
withheld shall be treated as having been distributed to such Certificateholder
for all purposes of this Agreement.
SECTION 4.4. REMIC Compliance.
(a) The parties intend that each of the Upper-Tier REMIC and the
Lower-Tier REMIC shall constitute, and that the affairs of each of the
Upper-Tier REMIC and the Lower-Tier REMIC shall be conducted so as to qualify it
as, a "real estate mortgage investment conduit" as defined in, and in accordance
with, the REMIC Provisions, and the provisions hereof shall be interpreted
consistently with this intention. In furtherance of such intention, the Trustee
shall, to the extent permitted by applicable law, act as agent, and is hereby
appointed to act as agent, of each of the Upper-Tier REMIC and the Lower-Tier
REMIC and shall on behalf of each of the Upper-Tier REMIC and the Lower-Tier
REMIC: (i) prepare, sign and file, or cause to be prepared and filed, all
required Tax Returns for each of the Upper-Tier REMIC and the Lower-Tier REMIC,
using a calendar year as the taxable year for each of the Upper-Tier REMIC and
the Lower-Tier REMIC, when and as required by the REMIC Provisions and other
applicable federal, state or local income tax laws; (ii) make an election, on
behalf of each of the Upper-Tier REMIC and the Lower-Tier REMIC, to be treated
as a REMIC on Form 1066 for its first taxable year, in accordance with the REMIC
Provisions; (iii) prepare and forward, or cause to be prepared and forwarded, to
the Certificateholders and the Internal Revenue Service and applicable state and
local tax authorities all information reports as and when required to be
provided to them in accordance with the REMIC Provisions; (iv) if the filing or
distribution of any documents of an administrative nature not addressed in
clauses (i) through (iii) of this Section 4.4 is then required by the REMIC
Provisions in order to maintain the status of the Upper-Tier REMIC or the
Lower-Tier REMIC as a REMIC or is otherwise required by the Code, prepare, sign
and file or distribute, or cause to be prepared and signed and filed or
distributed, such documents with or to such Persons when and as required by the
REMIC Provisions or the Code or comparable provisions of state and local law;
(v) within thirty days of the Closing Date, furnish or cause to be furnished to
the Internal Revenue Service, on Form 8811 or as otherwise may be required by
the Code, the name, title and address of the
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Person that the holders of the Certificates may contact for tax information
relating thereto (and the Trustee shall act as the representative of each of the
Upper-Tier REMIC and the Lower-Tier REMIC for this purpose), together with such
additional information as may be required by such Form, and shall update such
information at the time or times and in the manner required by the Code (and the
Depositor agrees within 10 Business Days of the Closing Date, to provide any
information reasonably requested by the Trustee and necessary to make such
filing); and (vi) maintain such records relating to each of the Upper-Tier REMIC
and the Lower-Tier REMIC as may be necessary to prepare the foregoing returns,
schedules, statements or information, such records, for federal income tax
purposes, to be maintained on a calendar year and on an accrual basis. The
Holder of the largest Percentage Interest in the Class R or Class LR
Certificates shall be the tax matters person of the Upper-Tier REMIC or the
Lower-Tier REMIC, respectively, pursuant to Treasury Regulations Section
1.860F-4(d). If more than one Holder should hold an equal Percentage Interest in
the Class R or Class LR Certificates larger than that held by any other Holder,
the first such Holder to have acquired such Class R or Class LR Certificates
shall be such tax matters person. The Trustee shall act as attorney-in-fact and
agent for the tax matters person of each of the Upper-Tier REMIC and the
Lower-Tier REMIC, and each Holder of a Percentage Interest in the Class R or
Class LR Certificates, by acceptance thereof, is deemed to have consented to the
Trustee's appointment in such capacity and agrees to execute any documents
required to give effect thereto, and any fees and expenses incurred by the
Trustee in connection with any audit or administrative or judicial proceeding
shall be paid by the Trust Fund. The Trustee shall not intentionally take any
action or intentionally omit to take any action if, in taking or omitting to
take such action, the Trustee knows that such action or omission (as the case
may be) would cause the termination of the REMIC status of the Upper-Tier REMIC
or the Lower-Tier REMIC or the imposition of tax on the Upper-Tier REMIC or the
Lower-Tier REMIC (other than a tax on income expressly permitted or contemplated
to be received by the terms of this Agreement). Notwithstanding any provision of
this paragraph to the contrary, the Trustee shall not be required to take any
action that the Trustee in good faith believes to be inconsistent with any other
provision of this Agreement, nor shall the Trustee be deemed in violation of
this paragraph if it takes any action expressly required or authorized by any
other provision of this Agreement, and the Trustee shall have no responsibility
or liability with respect to any act or omission of the Depositor or the
Servicer or the Special Servicer which causes the Trustee to be unable to comply
with any of clauses (i) through (vi) of the fifth preceding sentence or which
results in any action contemplated by clauses (i) or (ii) of the next succeeding
sentence. In this regard the Trustee shall (i) exercise reasonable care not to
allow the occurrence of any "prohibited transactions" with the meaning of Code
Section 860F(a), unless the party seeking such action shall have delivered to
the Trustee an Opinion of Counsel (at such party's expense) that such occurrence
would not (A) result in a taxable gain, (B) otherwise subject the Upper-Tier
REMIC or the Lower-Tier REMIC to tax (other than a tax at the highest marginal
corporate tax rate on net income from foreclosure property), or (C) cause either
the Upper-Tier REMIC or the Lower-Tier REMIC to fail to qualify as a REMIC; and
(ii) exercise reasonable care not to allow the Trust Fund to receive income from
the performance of services or from assets not permitted under the REMIC
Provisions to be held by a REMIC (provided, however, that the receipt of any
income expressly permitted or contemplated by the terms of this Agreement shall
not be deemed to violate this clause). Neither the Servicer, the Special
Servicer nor the Depositor shall be responsible or liable (except in connection
with any act or omission referred to in the two preceding sentences) for any
failure by the Trustee to comply with the
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provisions of this Section 4.4. The Depositor, the Special Servicer and the
Servicer shall cooperate in a timely manner with the Trustee in supplying any
information within the Depositor's, the Special Servicer's or the Servicer's
control (other than any confidential information) that is reasonably necessary
to enable the Trustee to perform its duties under this Section 4.4.
(b) The following assumptions are to be used for purposes of
determining the anticipated payments of principal and interest for calculating
the original yield to maturity and original issue discount with respect to the
Regular Certificates: (i) each Mortgage Loan will pay principal and interest in
accordance with its terms and scheduled payments will be timely received on
their Due Dates, provided that the Mortgage Loans in the aggregate will prepay
in accordance with the Prepayment Assumption; (ii) none of the Servicer, the
Depositor and the Class LR Certificateholders will exercise the right described
in Section 9.1 of this Agreement to cause early termination of the Trust Fund;
and (iii) no Mortgage Loan is repurchased by the Depositor.
SECTION 4.5. Imposition of Tax on the Trust Fund.
In the event that any tax, including interest, penalties or
assessments, additional amounts or additions to tax, is imposed on the
Upper-Tier REMIC or the Lower-Tier REMIC, such tax shall be charged against
amounts otherwise distributable to the Holders of the Certificates; provided,
that any taxes imposed on any net income from foreclosure property pursuant to
Code Section 860G(d) or any similar tax imposed by a state or local jurisdiction
shall instead be treated as an expense of the related REO Property in
determining Net REO Proceeds with respect to such REO Property (and until such
taxes are paid, the Servicer from time to time shall withdraw from the
Collection Account amounts reasonably determined by the Servicer to be necessary
to pay such taxes, which the Servicer shall maintain in a separate,
non-interest-bearing account, and the Servicer shall deposit in the Collection
Account the excess determined by the Servicer from time to time of the amount in
such account over the amount necessary to pay such taxes) and shall be paid
therefrom. Except as provided in the preceding sentence, the Trustee is hereby
authorized to and shall retain or cause to be retained from Pooled Available
Funds sufficient funds to pay or provide for the payment of, and to actually
pay, such tax as is legally owed by the Upper-Tier REMIC or the Lower-Tier REMIC
(but such authorization shall not prevent the Trustee from contesting, at the
expense of the Trust Fund, any such tax in appropriate proceedings, and
withholding payment of such tax, if permitted by law, pending the outcome of
such proceedings). The Trustee is hereby authorized to and shall segregate or
cause to be segregated, in a separate non-interest bearing account, (i) the net
income from any "prohibited transaction" under Code Section 860F(a) or (ii) the
amount of any contribution to the Upper-Tier REMIC or the Lower-Tier REMIC after
the Startup Day that is subject to tax under Code Section 860G(d) and use such
income or amount, to the extent necessary, to pay such tax, such amounts to be
segregated from the Collection Account with respect to any such net income of or
contribution to the Lower-Tier REMIC and from the Distribution Account with
respect to any such net income of or contribution to the Upper-Tier REMIC (and
return the balance thereof, if any, to the Collection Account or the
Distribution Account, as the case may be). To the extent that any such tax is
paid to the Internal Revenue Service, the Trustee shall retain an equal amount
from future amounts otherwise distributable
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to the Holders of the Class R or the Class LR Certificates as the case may be,
and shall distribute such retained amounts to the Holders of Regular
Certificates or Lower-Tier Regular Interests, as applicable, until they are
fully reimbursed and then to the Holders of the Class R Certificates or the
Class LR Certificates, as applicable. Neither the Servicer, the Special Servicer
nor the Trustee shall be responsible for any taxes imposed on the Upper-Tier
REMIC or the Lower-Tier REMIC, in either case, except to the extent such tax is
attributable to a breach of a representation or warranty of the Servicer or the
Special Servicer or an act or omission of the Servicer, the Special Servicer or
the Trustee in contravention of this Agreement, provided, further, that such
breach, act or omission could result in liability under Section 6.3 in the case
of the Servicer or Special Servicer or Section 4.4 or 8.1, in the case of the
Trustee. Notwithstanding anything in this Agreement to the contrary, in each
such case, the Servicer and the Special Servicer shall not be responsible for
the Trustee's breaches, acts or omissions, and the Trustee shall not be
responsible for the breaches, acts or omissions of the Servicer or the Special
Servicer.
SECTION 4.6. Remittances; P&I Advances.
(a) For purposes of this Section 4.6, "Applicable Monthly Payment"
shall mean, for any Mortgage Loan with respect to any month, (A) if such
Mortgage Loan is delinquent as to its Balloon Payment (including any Mortgage
Loan as to which the related Mortgaged Property has become an REO Property and
for any month after the related Balloon Payment would have been due), the
related Assumed Scheduled Payment and (B) if such Mortgage Loan is not described
by the preceding clause (including any such Mortgage Loan as to which the
related Mortgaged Property has become an REO Property), the Monthly Payment.
(b) On the Remittance Date immediately preceding each Distribution
Date, the Servicer shall:
(i) remit to the Trustee from the Collection Account for
deposit in the Distribution Account an amount equal to the
Prepayment Premiums received by the Servicer in the Collection
Period preceding such Remittance Date;
(ii) remit to the Trustee from the Collection Account for
deposit in the Distribution Account an amount equal to the Pooled
Available Funds for such Distribution Date (excluding P&I Advances);
and
(iii) make an advance, by deposit into the Collection Account,
and remit such amount to the Distribution Account in an amount equal
to the sum of the Applicable Monthly Payment for each Mortgage Loan,
to the extent such amounts were not received on such Mortgage Loans
as of the close of business on the Business Day immediately
preceding the Remittance Date.
(c) With respect to each Remittance Date, the Servicer shall
determine (a) with respect to each Seriously Delinquent Loan, the excess, if
any, of (x) the sum of the following amounts with respect to such Seriously
Delinquent Loan: (i) the outstanding principal balance thereof that is due and
payable; (ii) the interest portion of any unreimbursed P&I Advances with
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respect thereto; (iii) any unreimbursed Property Advances with respect thereto;
and (iv) any currently due and payable or delinquent property taxes with respect
thereto over (y) the appraised value (as reflected in the related Updated
Appraisal) thereof and (b) the sum of all amounts described in clause (a) (such
sum, the "Anticipated Loss"). Notwithstanding Section 4.6(b)(iii), with respect
to any Remittance Date, the Servicer shall make a P&I Advance with respect to
any Seriously Delinquent Loan only to the extent that Pooled Available Funds for
the related Distribution Date (exclusive of any P&I Advance with respect to any
Seriously Delinquent Loans) are insufficient to make distributions to all
Classes of Lower-Tier Regular Interests and all Classes of Certificates pursuant
to Section 4.1(a)(I) and Section 4.1(b)(I), respectively, other than, in each
case, the most subordinate Class then outstanding and any other Class as to
which the aggregate of the Certificate Balances of all Classes subordinate to
such Class does not equal or exceed the Anticipated Loss. In the event that,
with respect to any Remittance Date, more than one Mortgage Loan is a Seriously
Delinquent Loan, the Servicer shall designate on its records the specific
Seriously Delinquent Loans as to which any P&I Advance shall be deemed to have
been made. Any such designation of P&I Advances to specific Seriously Delinquent
Loans shall be made, first, among Seriously Delinquent Loans (excluding any REO
Mortgage Loans) as to which the related Borrower is delinquent only in the
payment of Monthly Payments; second, among Seriously Delinquent Loans (excluding
REO Mortgage Loans) as to which the related Borrower is delinquent in the
payment of a Balloon Payment; and third, among Seriously Delinquent Loans that
are REO Mortgage Loans; provided, however, that any such designation shall be
made first to those Seriously Delinquent Loans in respect of which the Servicer
reasonably determines that such P&I Advance is most likely to be recoverable.
(d) Any amount advanced by the Servicer pursuant to Section
4.6(b)(iii) shall constitute a P&I Advance for all purposes of this Agreement
and the Servicer shall be entitled to reimbursement thereof pursuant to 3.6(ii).
The Servicer shall further be entitled to Advance Interest Amounts accrued on
the amount of any such P&I Advance at the Advance Rate and shall be entitled to
payment or reimbursement thereof pursuant to 3.6(iii).
(e) If, as of 5:00 p.m., New York City time, on any Remittance Date
the Servicer shall not (i) have made the P&I Advance required to have been made
on such date pursuant to Section 4.6(b)(iii) or (ii) delivered the certificate
and documentation related to a determination of nonrecoverability, the Trustee
shall immediately notify the Fiscal Agent by telephone promptly confirmed in
writing, and the Trustee shall no later than 10:00 a.m., New York City time, on
such Distribution Date deposit into the Distribution Account in immediately
available funds an amount equal to the P&I Advances otherwise required to have
been made by the Servicer. If the Trustee fails to make any P&I Advance required
to be made under this Section 4.6, the Fiscal Agent shall make such P&I Advance
not later than 11:00 a.m., New York City time, on such Distribution Date and,
thereby, the Trustee shall not be in default under this Agreement.
(f) Anything to the contrary in this Agreement notwithstanding, none
of the Servicer, the Trustee or the Fiscal Agent shall be obligated to make a
P&I Advance as to any Monthly Payment or Assumed Scheduled Payment on any date
on which a P&I Advance is otherwise required to be made by this Section 4.6 if
the Servicer, the Trustee or the Fiscal
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Agent, as applicable, determines that such advance will be a Nonrecoverable
Advance. The Trustee and the Fiscal Agent shall be entitled to rely,
conclusively, on any determination by the Servicer that a P&I Advance, if made,
would be a Nonrecoverable Advance. The Trustee and the Fiscal Agent, in
determining whether or not a P&I Advance previously made is, or a proposed P&I
Advance, if made, would be, a Nonrecoverable Advance shall be subject to the
standards applicable to the Servicer hereunder.
(g) The Servicer, the Trustee or the Fiscal Agent, as applicable,
shall be entitled to, and hereby covenants and agrees to promptly seek and
effect, the reimbursement of P&I Advances it makes to the extent permitted
pursuant to Section 3.6(ii) of this Agreement together with any related Advance
Interest Amount in respect of such P&I Advances to the extent permitted pursuant
to Section 3.6(iii).
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ARTICLE V
THE CERTIFICATES
SECTION 5.1. The Certificates.
The Certificates consist of the Class A-1 Certificates, the Class
A-2 Certificates, the Class A-EC Certificates, the Class B Certificates, the
Class C Certificates, the Class D Certificates, the Class E Certificates, the
Class F Certificates, the Class G Certificates, the Class H Certificates, the
Class J-1 Certificates and the Class J-2 Certificates, the Class R Certificates
and the Class LR Certificates.
The Class A-1, Class A-2, Class A-EC, Class B, Class C, Class D,
Class E, Class F, Class G, Class H, Class J-1, Class J-2, Class R and Class LR
Certificates will be substantially in the forms annexed hereto as Exhibits A-1,
A-2, A-3, A-4, A-5, A-6, A-7, A-8, A-9, A-10, A-11, A-12, A-14 and A-13
respectively. The Certificates of each Class will be issuable in definitive
physical form only, registered in the name of the holders thereof; provided,
however, that in accordance with Section 5.3 beneficial ownership interests in
the Class A-1, Class A-2, Class A-EC, Class B, Class C, Class D, Class E and
Class F Certificates shall initially be represented by Book-Entry Certificates
held and transferred through the book-entry facilities of the Securities
Depository, in minimum denominations of authorized initial Certificate Balance
or notional amount (except with respect to the Class R and Class LR
Certificates), as described in the succeeding table. The Book-Entry Certificates
shall be in minimum denominations of $100,000 and multiples of $1,000 in excess
thereof and the Certificates other than Book-Entry Certificates shall be in
minimum denominations of $100,000 and multiples of $1 in excess thereof, except
one Certificate of each such Class may be issued which represents a different
initial Certificate Balance or Notional Balance to accommodate the remainder of
the initial Certificate Balance or related Notional amount. Each Certificate
will share ratably in all rights of the related Class. The Class R and LR
Certificates shall each be issuable in one or more registered, definitive
physical certificates in minimum denominations of 5% Percentage Interests and
integral multiples of a 1% Percentage Interest in excess thereof and together
aggregating the entire 100% Percentage Interest in each such Class.
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<TABLE>
<CAPTION>
Aggregate Denominations
of all Certificates of Class
Minimum (in initial Certificate Balance or
Class Denomination initial Notional Balance)
- ----- ------------ -------------------------
<S> <C> <C>
A-1 $100,000 $ 75,000,000
A-2 100,000 $ 65,040,000
A-EC 100,000 $222,286,173.25
B 100,000 $ 8,891,000
C 100,000 $ 13,337,000
D 100,000 $ 8,892,000
E 100,000 $ 15,560,000
F 100,000 $ 5,557,000
G 100,000 $ 12,226,000
H 100,000 $ 11,114,000
J-1 100,000 $ 6,669,173.25
J-2 100,000 $ 6,669,173.25
</TABLE>
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.
Each Certificate may be printed or in typewritten or similar form,
and each Certificate shall, upon original issue, be executed and authenticated
by the Trustee or the Authenticating Agent and delivered to the Depositor. All
Certificates shall be executed by manual or facsimile signature on behalf of the
Trustee or Authenticating Agent by an authorized officer or signatory.
Certificates bearing the signature of an individual who was at any time the
proper officer or signatory of the Trustee or Authenticating Agent shall bind
the Trustee or Authenticating Agent, notwithstanding that such individual has
ceased to hold such office or position prior to the delivery of such
Certificates or did not hold such office or position at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such Certificate
a certificate of authentication in the form set forth in Exhibits A-1 through
A-14 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 5.2. Registration, Transfer and Exchange of Certificates.
(a) The Trustee shall keep or cause to be kept at the Corporate
Trust Office books (the "Certificate Register") for the registration, transfer
and exchange of Certificates (the Trustee, in such capacity, being the
"Certificate Registrar"). The names and addresses of all Certificateholders and
the names and addresses of the transferees of any Certificates shall be
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registered in the Certificate Register. The Person in whose name any Certificate
is so registered shall be deemed and treated as the sole owner and Holder
thereof for all purposes of this Agreement and the Certificate Registrar, the
Servicer, the Special Servicer, the Trustee, any Paying Agent and any agent of
any of them shall not be affected by any notice or knowledge to the contrary. An
Individual Certificate is transferable or exchangeable only upon the surrender
of such Certificate to the Certificate Registrar at the Corporate Trust Office
together with an assignment and transfer (executed by the Holder or his duly
authorized attorney), subject to the requirements of Section 5.2(c), (d), (e)
and (f). Upon request of the Trustee, the Certificate Registrar shall provide
the Trustee with the names, addresses and Percentage Interests of the Holders.
(b) Upon surrender for registration of transfer of any Individual
Certificate, subject to the requirements of Section 5.2(c), (d), (e) and (f),
the Trustee shall execute and the Authenticating Agent shall duly authenticate
in the name of the designated transferee or transferees, one or more new
Certificates in authorized denominations of a like aggregate Certificate
Balance. Such Certificates shall be delivered by the Certificate Registrar in
accordance with Section 5.2(e). Each Certificate surrendered for registration of
transfer shall be cancelled and subsequently destroyed by the Certificate
Registrar. Each new Certificate issued pursuant to this Section 5.2 shall be
registered in the name of any Person as the transferring Holder may request,
subject to the provisions of Section 5.2(c), (d), (e) and (f).
(c) The exchange, transfer and registration of transfer of
Individual Certificates that are Privately Placed Certificates shall be subject
to the restrictions set forth below (in addition to the provisions of Section
5.2(d), (e) and (f)):
(i) The Certificate Registrar shall register the transfer of an
Individual Certificate that is a Privately Placed Certificate
if the requested transfer is being made to a transferee who
has provided the Certificate Registrar with an Investment
Representation Letter substantially in the form of Exhibit D-1
hereto (an "Investment Representation Letter"), to the effect
that the transfer is being made to a Qualified Institutional
Buyer in accordance with Rule 144A; or
(ii) The Certificate Registrar shall register the transfer of an
Individual Certificate that is a Privately Placed Certificate
(other than a Class R or Class LR Certificate), if prior to
the transfer, the transferee furnishes to the Certificate
Registrar (1) an Investment Representation Letter to the
effect that the transfer is being made to an Institutional
Accredited Investor in accordance with an applicable exemption
under the Act, (2) an Opinion of Counsel acceptable to the
Certificate Registrar that such transfer is in compliance with
the Act, and (3) a written undertaking by the transferor to
reimburse the Trust for any costs incurred by it in connection
with the proposed transfer. In addition, the Certificate
Registrar may, as a condition of the registration of any such
transfer, require the transferor to furnish such other
certificates, legal opinions or other information (at the
transferor's expense) as the Certificate Registrar
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may reasonably require to confirm that the proposed transfer
is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of
the Act and other applicable laws.
(d) Subject to the restrictions on transfer and exchange set forth
in this Section 5.2, the Holder of one or more Certificates may transfer or
exchange the same in whole or in part (with a Certificate Balance equal to any
authorized denomination) by surrendering such Certificate at the Corporate Trust
Office or at the office of any transfer agent appointed as provided under this
Agreement, together with an instrument of assignment or transfer (executed by
the Holder or its duly authorized attorney), in the case of transfer, and a
written request for exchange in the case of exchange. Subject to the
restrictions on transfer set forth in this Section 5.2, following a proper
request for transfer or exchange, the Certificate Registrar shall, within five
Business Days of such request if made at the Corporate Trust Office, or within
ten Business Days if made at the office of a transfer agent (other than the
Certificate Registrar), execute and deliver at the Corporate Trust Office or at
the office of such transfer agent, as the case may be, to the transferee (in the
case of transfer) or the Holder (in the case of exchange) or send by first class
mail (at the risk of the transferee in the case of transfer or the Holder in the
case of exchange) to such address as the transferee or the Holder, as
applicable, may request, an Individual Certificate or Certificates, as the case
may require, for a like aggregate Certificate Balance and in such authorized
denomination or denominations as may be requested. The presentation for transfer
or exchange of any Individual Certificate shall not be valid unless made at the
Corporate Trust Office or at the office of a transfer agent by the registered
Holder in person, or by a duly authorized attorney-in-fact. The Certificate
Registrar may decline to accept any request for an exchange or registration of
transfer of any Certificate during the period of 15 days preceding any
Distribution Date.
(e) Individual Certificates may only be transferred to Eligible
Investors as described herein. In the event the Certificate Registrar shall
determine that an Individual Certificate is being held by or for the benefit of
a Person who is not an Eligible Investor, or that such holding is unlawful under
the laws of a relevant jurisdiction, then the Certificate Registrar shall void
such transfer, if permitted under applicable law.
(f) No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange referred to in this Section 5.2 other than for transfers to
Institutional Accredited Investors, as provided herein. In connection with any
transfer to an Institutional Accredited Investor, the transferor shall reimburse
the Trust for any costs (including the cost of the Certificate Registrar's
counsel's review of the documents and any legal opinions submitted by the
transferor or transferee to the Certificate Registrar as provided herein)
incurred by the Certificate Registrar in connection with such transfer. The
Certificate Registrar may require payment by each transferor of a sum sufficient
to cover any tax, expense or other governmental charge payable in connection
with any such transfer.
(g) Subject to Section 5.2(d), transfers of the Class R and Class
LR Certificates may be made only in accordance with this Section 5.2(g). The
Certificate Registrar shall register the transfer of a Class R or Class LR
Certificate if (x) the transferor has advised the Certificate Registrar in
writing that the Certificate is being transferred to a Qualified
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Institutional Buyer; and (y) prior to transfer the transferor furnishes to the
Certificate Registrar an Investment Representation Letter. In addition, the
Certificate Registrar may, as a condition of the registration of any such
transfer, require the transferor to furnish such other certifications, legal
opinions or other information (at the transferor's expense) as they may
reasonably be required to confirm that the proposed transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Act and other applicable laws.
(h) Neither the Depositor, the Servicer, the Special Servicer, the
Trustee nor the Certificate Registrar is obligated to register or qualify any
Class of Certificates under the Act or any other securities law or to take any
action not otherwise required under this Agreement to permit the transfer of
such Certificates without registration or qualification. Any Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Depositor, the Servicer, the Special Servicer, the Trustee and the Certificate
Registrar, against any loss, liability or expense that may result if the
transfer is not exempt from the registration requirements of the Act or is not
made in accordance with such federal and state laws.
(i) No transfer of any Ownership Interest in a Subordinate
Certificate shall be made to (i) an employee benefit plan subject to the
fiduciary responsibility provisions of ERISA, or Section 4975 of the Code, or a
governmental plan subject to any federal, state or local law ("Similar Law"),
which is to a material extent, similar to the foregoing provisions of ERISA or
the Code (collectively, a "Plan") or (ii) an insurance company that is using the
assets of any insurance company separate account or general account in which the
assets of any such Plan are invested (or which are deemed pursuant to ERISA or
any Similar Law to include assets of Plans) to acquire any such Subordinate
Certificates, other than using assets of its general account in circumstances
whereby such transfer and the subsequent holding of the Certificate would not
constitute or result in a prohibited transaction within the meaning of Section
406 or 407 of ERISA, Section 4975 of the Code, or any Similar Law. Each
prospective transferee of a Subordinate Certificate is shall deliver to the
Depositor, the Certificate Registrar and the Trustee, (a) a transfer or
representation letter, substantially in the form of Exhibit D-2 hereto, stating
that the prospective transferee is not a Person referred to in (i) or (ii)
above, or (b) an Opinion of Counsel which establishes to the satisfaction of the
Depositor, the Trustee and the Certificate Registrar that the purchase or
holding of the Subordinate Certificate will not result in the assets of the
Trust Fund being deemed to be "plan assets" and subject to the fiduciary
responsibility or prohibited transaction provisions of ERISA, the Code, or any
Similar Law will not constitute or result in a prohibited transaction within the
meaning of Section 406 or Section 407 of ERISA or Section 4975 of the Code, and
will not subject the Servicer, the Special Servicer, the Depositor, the Trustee
or the Certificate Registrar to any obligation or liability (including
obligations or liabilities under ERISA or Section 4975 of the Code), which
Opinion of Counsel shall not be an expense of the Trustee, the Trust Fund, the
Servicer, the Special Servicer, Certificate Registrar or the Depositor. Neither
the Trustee, the Servicer, the Special Servicer, nor the Certificate Registrar
will register a Class R or Class LR Certificate in any Person's name unless such
Person has provided the letter referred to in clause (a) above. Any transfer of
a Subordinate Certificate that would violate, or result in a prohibited
transaction under, ERISA or Section 4975 of the Code shall be deemed absolutely
null and void ab initio.
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(j) Each Person who has or acquires any Ownership Interest in a
Class R Certificate or a Class LR Certificate shall be deemed by the acceptance
or acquisition of such Ownership Interest to have agreed to be bound by the
following provisions, and the rights of each Person acquiring any Ownership
Interest in a Class R Certificate or a Class LR Certificate are expressly
subject to the following provisions:
(i) Each Person acquiring or holding any Ownership Interest in a
Class R Certificate or a Class LR Certificate shall be a
Permitted Transferee and shall not acquire or hold such
Ownership Interest as agent (including as a broker, nominee or
other middleman) on behalf of any Person that is not a
Permitted Transferee. Any such Person shall promptly notify
the Certificate Registrar of any change or impending change in
its status (or the status of the beneficial owner of such
Ownership Interest) as a Permitted Transferee. Any acquisition
described in the first sentence of this Section 5.2(j)(i) by a
Person who is not a Permitted Transferee or by a Person who is
acting as an agent of a Person who is not a Permitted
Transferee shall be void and of no effect, and the immediately
preceding owner who was a Permitted Transferee shall be
restored to registered and beneficial ownership of the
Ownership Interest as fully as possible.
(ii) No Ownership Interest in a Class R Certificate or a Class LR
Certificate may be transferred, and no such Transfer shall be
registered in the Certificate Register, without the express
written consent of the Certificate Registrar, and the
Certificate Registrar shall not recognize a proposed Transfer,
and such proposed Transfer shall not be effective, without
such consent with respect thereto. In connection with any
proposed Transfer of any Ownership Interest in a Class R
Certificate or a Class LR Certificate, the Certificate
Registrar shall, as a condition to such consent, (x) require
delivery to it in form and substance satisfactory to it, and
the proposed transferee shall deliver to the Certificate
Registrar and to the proposed transferor, an affidavit in
substantially the form attached as Exhibit C-1 (a "Transferee
Affidavit") (A) that such proposed transferee is a Permitted
Transferee and (B) stating that (i) the proposed transferee
historically has paid its debts as they have come due and
intends to do so in the future, (ii) the proposed transferee
understands that, as the holder of an Ownership Interest in a
Class R Certificate or a Class LR Certificate, as applicable ,
it may incur liabilities in excess of cash flows generated by
the residual interest, (iii) the proposed transferee intends
to pay taxes associated with holding the Ownership Interest as
they become due, (iv) the proposed transferee will not
transfer the Ownership Interest to any Person that does not
provide a Transferee Affidavit or as to which the proposed
transferee has actual knowledge that such Person is not a
Permitted Transferee or is acting as an agent (including as a
broker, nominee or other middleman) for a Person that is not a
Permitted Transferee, and (v) the proposed transferee
expressly agrees to be bound by and to abide by the provisions
of this Section 5.2(j) and (y) other than
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in connection with the initial issuance of the Class R and
Class LR Certificates, require a statement from the proposed
transferor substantially in the form attached as Exhibit C-2
(the "Transferor Letter"), that the proposed transferor has no
actual knowledge that the proposed transferee is not a
Permitted Transferee and has no actual knowledge or reason to
know that the proposed transferee's statements in the
preceding clauses (x)(B)(i) or (iii) are false.
(iii) Notwithstanding the delivery of a Transferee Affidavit by a
proposed transferee under clause (ii) above, if a Responsible
Officer of the Certificate Registrar has actual knowledge that
the proposed transferee is not a Permitted Transferee, no
Transfer to such proposed transferee shall be effected and
such proposed Transfer shall not be registered on the
Certificate Register; provided, however, that the Certificate
Registrar shall not be required to conduct any independent
investigation to determine whether a proposed transferee is a
Permitted Transferee.
Upon notice to the Certificate Registrar that there has occurred a
Transfer to any Person that is a Disqualified Organization or an agent thereof
(including a broker, nominee, or middleman) in contravention of the foregoing
restrictions, and in any event not later than 60 days after a request for
information from the transferor of such Ownership Interest in a Class R
Certificate or a Class LR Certificate, or such agent thereof, the Certificate
Registrar and the Trustee agree to furnish to the IRS and the transferor of such
Ownership Interest or such agent thereof such information necessary to the
application of Section 860E(e) of the Code as may be required by the Code,
including, but not limited to, the present value of the total anticipated excess
inclusions with respect to such Class R or Class LR Certificate (or portion
thereof) for periods after such Transfer. At the election of the Certificate
Registrar and the Trustee, the Certificate Registrar and the Trustee may charge
a reasonable fee for computing and furnishing such information to the transferor
or to such agent thereof referred to above; provided, however, that such Persons
shall in no event be excused from furnishing such information.
SECTION 5.3. Book-Entry Certificates.
(a) The Class A-1 Certificates, the Class A-2 Certificates, the
Class A-EC Certificates, the Class B Certificates, the Class C Certificates, the
Class D Certificates, the Class E Certificates and the Class F Certificates
shall, in the case of each such Class, initially be issued as one or more
Book-Entry Certificates registered in the name of the Securities Depository or
its nominees and, except as provided in subsection (c) below, transfer of such
Certificates may not be registered by the Certificate Registrar unless such
transfer is to a successor Securities 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 Interest in and to such Certificates through the book-entry facilities
of the Securities Depository and, except as provided in subsection (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
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Securities Depository Participant or brokerage firm representing each such
Certificate Owner. Each Securities 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 Securities Depository's normal procedures. Neither the Certificate Registrar
nor the Trustee shall have any responsibility to monitor or restrict the
transfer of Ownership Interests in Book-Entry Certificates through the
book-entry facilities of the Securities Depository.
(b) The Trustee, the Servicer, the Special Servicer, the Fiscal
Agent and the Certificate Registrar may for all purposes, including the making
of payments due on the Book- Entry Certificates, deal with the Securities
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 Securities Depository
Participants and brokerage firms representing such Certificate Owners. Multiple
requests and directions from, and votes of, the Securities 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 Securities Depository of such record date.
(c) If (i)(A) the Depositor advises the Trustee and the Certificate
Registrar in writing that the Securities Depository is no longer willing or able
to properly discharge its responsibilities with respect to any 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 Securities Depository with respect to any Class of the
Book-Entry Certificates, the Certificate Registrar shall notify all affected
Certificate Owners, through the Securities Depository, of the occurrence of any
such event and of the availability of Definitive Certificates to such
Certificate Owners requesting the same. Upon surrender to the Certificate
Registrar of any Class of the Book-Entry Certificates by the Securities
Depository, accompanied by registration instructions from the Securities
Depository for registration of transfer, the Trustee shall execute, and the
Certificate Registrar shall authenticate and deliver, the Definitive
Certificates to the Certificate Owners identified in such instructions. None of
the Depositor, the Servicer, the Special Servicer, the Trustee, the Fiscal Agent
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 of the Class A-1 Certificates, the Class A-2
Certificates, the Class A-EC Certificates, the Class B Certificates, the Class C
Certificates, the Class D Certificates, the Class E Certificates and the Class F
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 5.4. Mutilated, Destroyed, Lost or Stolen Certificates.
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If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (ii) there is delivered
to the Certificate Registrar such security or indemnity as may be requited by it
to save it, be Trustee and the Servicer harmless, then, in the absence of actual
knowledge by a Responsible Officer of the Certificate Registrar that such
Certificate has been acquired by a bona fide purchaser, the Trustee or the
Authenticating Agent shall execute and authenticate and the Certificate
Registrar shall deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of the same Class and
of like tenor and Percentage Interest. Upon the issuance of any new Certificate
under this Section 5.4, the Certificate Registrar may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Certificate Registrar) connected therewith. Any replacement Certificate
issued pursuant to this Section 5.4 shall constitute complete and indefeasible
evidence of ownership of the corresponding interest in the Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
SECTION 5.5. Appointment of Paying Agent.
The Trustee may appoint a paying agent for the purpose of making
distributions to Certificateholders pursuant to Section 4.1. The Trustee shall
cause such Paying Agent, if other than the Trustee or the Servicer, to execute
and deliver to the Servicer and the Trustee an instrument in which such Paying
Agent shall agree with the Servicer and the Trustee that such Paying Agent will
hold all sums held by it for payment to Certificateholders in trust for the
benefit of the Certificateholders entitled thereto until such sums have been
paid to such Certificateholders or disposed of as otherwise provided herein. The
initial Paying Agent shall be the Trustee. The Paying Agent shall at all times
be an entity having a long-term unsecured debt rating of at least "BBB" by each
Rating Agency, unless each of the Rating Agencies has confirmed in writing that
a lower rating shall not result, in and of itself, in a downgrading, withdrawal
or qualification of the rating then assigned by such Rating Agency to any Class
of the Certificates.
SECTION 5.6. Access to Certificateholders' Names and Addresses.
(a) If any Certificateholder (for purposes of this Section 5.6, an
"Applicant") applies in writing to the Certificate Registrar, and such
application states that the Applicant desires to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and is accompanied by a copy of the communication which such
Applicant proposes to transmit, then the Certificate Registrar shall, at the
expense of such Applicant, within ten Business Days after the receipt of such
application, transmit such communication to the Certificateholders as of the
most recent Record Date; provided, however, if such communication relates to
performance by the Servicer, the Special Servicer or the Trustee of its duties
hereunder, the Certificate Registrar shall furnish or cause to be furnished to
such Applicant a list of the names and addresses of the Certificateholders as of
the most recent Record Date.
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(b) Every Certificateholder, by receiving and holding its
Certificate, agrees with the Trustee that the Trustee and the Certificate
Registrar shall not be held accountable in any way by reason of the disclosure
of any information as to the names and addresses of the Certificateholders
hereunder, regardless of the source from which such information was derived.
SECTION 5.7. Actions of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
an agent duly appointed in writing; and except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, when required, to the Depositor, the Special
Servicer or the Servicer. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Agreement and conclusive in favor of the Trustee, the Depositor, the Special
Servicer and the Servicer, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Certificateholder of
any such instrument or writing may be proved in any reasonable manner which the
Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder shall bind every Holder of every
Certificate issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done, or omitted to be done,
by the Trustee, the Depositor, the Special Servicer or the Servicer in reliance
thereon, whether or not notation of such action is made upon such Certificate.
(d) The Trustee or Certificate Registrar may require such additional
proof of any matter referred to in this Section 5.7 as it shall deem necessary.
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ARTICLE VI
THE DEPOSITOR, THE SERVICER AND THE SPECIAL SERVICER
SECTION 6.1. Liability of the Depositor, the Servicer and the
Special Servicer.
The Depositor, the Servicer and the Special Servicer each shall be
liable in accordance herewith only to the extent of the obligations specifically
imposed by this Agreement.
SECTION 6.2. Merger or Consolidation of the Servicer and Special
Servicer.
Subject to the third paragraph of this Section 6.2, the Servicer
will keep in full effect its existence, rights and good standing as a limited
partnership under the laws of the State of Missouri and will not jeopardize its
ability to do business in each jurisdiction in which one or more of the
Mortgaged Properties are located or to protect the validity and enforceability
of this Agreement, the Certificates or any of the Mortgage Loans and to perform
its respective duties under this Agreement.
Subject to the following paragraph, the Special Servicer will keep
in full effect its existence, rights and good standing as a corporation under
the laws of the State of Florida and will not jeopardize its ability to do
business in each jurisdiction in which one or more of the Mortgaged Properties
are located or to protect the validity and enforceability of this Agreement, the
Certificates or any of the Specially Serviced Mortgage Loans and to perform its
respective duties under this Agreement.
Each of the Servicer and the Special Servicer may be merged or
consolidated with or into any Person, or transfer all or substantially all of
its assets to any Person, in which case any Person resulting from any merger or
consolidation to which it shall be a party, or any Person succeeding to its
business, shall be the successor of the Servicer or the Special Servicer, as
applicable hereunder, and shall be deemed to have assumed all of the liabilities
of the Servicer or the Special Servicer, as applicable hereunder, if each of the
Rating Agencies has confirmed in writing that such merger, consolidation or
transfer and succession shall not result, in and of itself, in a downgrading,
withdrawal or qualification of the rating then assigned by such Rating Agency to
any Class of Certificates.
SECTION 6.3. Limitation on Liability of the Depositor, the
Servicer and Others.
Neither the Depositor, the Servicer, the Special Servicer, the
Extension Advisor nor any of the directors, officers, employees or agents of the
Depositor or the Servicer or the Special Servicer or the Extension Advisor (or
any general partner of the Servicer or, if applicable, the Special Servicer or
the Extension Advisor) shall be under any liability to the Trust Fund or the
Certificateholders for any action taken, or for refraining from the taking of
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any action, in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor or the
Servicer or the Special Servicer or any Extension Advisor or any such Person
against any breach of warranties or representations made herein, or against any
specific liability imposed on the Servicer or the Special Servicer or any
Extension Advisor for a breach of the Servicing Standard, or against any
liability which would otherwise be imposed by reason of its respective willful
misfeasance, bad faith, fraud or negligence in the performance of its duties or
by reason of reckless disregard of its respective obligations or duties
hereunder. The Depositor, the Servicer, the Special Servicer and any Extension
Advisor and any director, officer, employee or agent of the Depositor, the
Servicer, the Special Servicer and any Extension Advisor (or the general partner
of the Servicer or, if applicable, the Special Servicer or any Extension
Advisor) may rely in good faith on any document of any kind which, prima facie,
is properly executed and submitted by any appropriate Person with respect to any
matters arising hereunder. The Depositor, the Servicer, the Special Servicer and
any Extension Advisor and any director, officer, employee or agent of the
Depositor, the Servicer or the Special Servicer or any Extension Advisor (or the
general partner of the Servicer or, if applicable, the Special Servicer or any
Extension Advisor) shall be indemnified and held harmless by the Trust Fund
against any loss, liability or expense incurred in connection with any legal
action relating to this Agreement or the Certificates, other than any loss,
liability or expense (i) incurred by reason of its respective willful
misfeasance, bad faith, fraud or negligence or (in the case of the Servicer or
Special Servicer or any Extension Advisor) a breach of the Servicing Standard in
the performance of its respective duties or by reason of reckless disregard of
its respective obligations or duties hereunder; or (ii) imposed by any taxing
authority which loss, liability or expense is not specifically reimbursable
pursuant to the terms of this Agreement or which results from a breach (other
than a breach with respect to which the Servicer or Special Servicer or any
Extension Advisor, as applicable, would have no liability under the standard set
forth in the first sentence of this paragraph) by the Servicer, the Special
Servicer, the Extension Advisor or the agents of any of them of its obligations
hereunder. Neither the Depositor nor the Servicer nor the Special Servicer shall
be under any obligation to appear in, prosecute or defend any legal action
unless such action is related to its respective duties under this Agreement and
in its opinion does not expose it to any expense or liability; provided,
however, that the Depositor or the Servicer or the Special Servicer or any
Extension Advisor may in its discretion undertake any action related to its
obligations hereunder which it may deem necessary or desirable with respect to
this Agreement and the rights and duties of the parties hereto and the interests
of the Certificateholders hereunder. In such event, the legal expenses and costs
of such action and any liability resulting therefrom (except any liability
related to the Servicer's or the Special Servicer's obligations under Section
3.1(a)) shall be expenses, costs and liabilities of the Trust Fund, and the
Depositor, the Servicer and the Special Servicer shall be entitled to be
reimbursed therefor from the Collection Account as provided in Section 3.6(vi)
of this Agreement.
SECTION 6.4. Limitation on Resignation of the Servicer and of the
Special Servicer.
Each of the Servicer and the Special Servicer may assign its
respective rights and delegate its respective duties and obligations under this
Agreement in connection with the sale or transfer of a substantial portion of
its mortgage servicing or asset management portfolio,
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provided that: (i) the purchaser or transferee accepting such assignment and
delegation (A) shall be satisfactory to the Trustee, (B) shall be (I) an
established mortgage finance institution, bank or mortgage servicing
institution, organized and doing business under the laws of any state of the
United States or the District of Columbia, authorized under such laws to perform
the duties of a servicer of mortgage loans or (II) a Person resulting from a
merger, consolidation or succession that is permitted under Section 6.2, and (C)
shall execute and deliver to the Trustee an agreement, in form and substance
reasonably satisfactory to the Trustee, which contains an assumption by such
Person of the due and punctual performance and observance of each covenant and
condition to be performed or observed by the Servicer or the Special Servicer,
as applicable, under this Agreement from and after the date of such agreement;
(ii) as evidenced by a letter from each Rating Agency delivered to the Trustee,
each Rating Agency's rating or ratings of the Regular Certificates in effect
immediately prior to such assignment and delegation will not be qualified,
downgraded or withdrawn as a result of such assignment and delegation; (iii) the
Servicer or the Special Servicer, as applicable, shall not be released from its
obligations under this Agreement that arose prior to the effective date of such
assignment and delegation under this Section 6.4; and (iv) the rate at which the
Servicing Fee (or any component thereof) is calculated shall not exceed the rate
in effect prior to such assignment and delegation. Upon acceptance of such
assignment and delegation, the purchaser or transferee shall be the successor
Servicer or Special Servicer hereunder, as applicable.
Except as provided in this Section 6.4, neither the Servicer nor the
Special Servicer shall resign from the obligations and duties hereby imposed on
it except upon determination that its duties hereunder are no longer permissible
under applicable law. Any such determination permitting the resignation of the
Servicer or the Special Servicer, as applicable, shall be evidenced by an
Opinion of Counsel (obtained at the resigning Servicer's expense) to such effect
delivered to the Trustee.
No resignation or removal of the Servicer or the Special Servicer,
as applicable, as contemplated by the preceding paragraphs shall become
effective until the Trustee or a successor Servicer or the Special Servicer, as
applicable, shall have assumed the Servicer's or the Special Servicer's
responsibilities, duties, liabilities and obligations hereunder.
SECTION 6.5. Rights of the Depositor and the Trustee in
Respect of the Servicer and the Special Servicer.
Each of the Servicer and the Special Servicer shall afford the
Depositor and the Trustee, upon reasonable notice, during normal business hours
access to all records maintained by it in respect of its rights and obligations
hereunder and access to its officers responsible for such obligations. Upon
request, each of the Servicer and the Special Servicer shall furnish to the
Depositor and the Trustee its most recent financial statements and such other
information in its possession regarding its business, affairs, property and
condition, financial or otherwise, as the party requesting such information, in
its reasonable judgment, determines to be relevant to the performance of the
obligations hereunder of the Servicer or the Special Servicer. Neither the
Depositor nor the Trustee shall have any responsibility or liability for any
action or failure to act by the Servicer or the Special Servicer and neither
such Person is obligated to supervise the performance of the Servicer or the
Special Servicer under this Agreement or otherwise.
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ARTICLE VII
DEFAULT
SECTION 7.1. Events of Default.
"Event of Default", wherever used herein, means any one of the
following events:
(i) any failure by the Servicer to remit to the Collection Account
or any failure by the Servicer to remit to the Trustee for
deposit into the Distribution Account any amount required to
be so remitted by the Servicer pursuant to and in accordance
with the terms of this Agreement; or
(ii) any failure on the part of the Servicer or Special Servicer
duly to observe or perform in any material respect any other
of the covenants or agreements, or the breach of any
representations or warranties provided herein on the part of
the Servicer or the Special Servicer which materially and
adversely affects the interests of the Certificateholders, the
Servicer, the Special Servicer or the Trustee with respect to
any Mortgage Loan and which, in either event, continues
unremedied for a period of 30 days after the date on which
written notice of such failure or breach, requiring the same
to be remedied, shall have been given to the Servicer or
Special Servicer by the Depositor or the Trustee, or to the
Servicer or Special Servicer, the Depositor and the Trustee by
the Holders of Certificates entitled to at least 25% of the
aggregate Voting Rights of any Class affected thereby; or
(iii) confirmation in writing by any of the Rating Agencies that the
then-current rating assigned to any Class of Certificates will
be withdrawn, downgraded or qualified if the Servicer or
Special Servicer is not removed as Servicer or Special
Servicer hereunder; or
(iv) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an
involuntary case under any present or future federal or state
bankruptcy, insolvency or similar law for the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of
its affairs, shall have been entered against the Servicer or
Special Servicer and such decree or order shall have remained
in force, undischarged or unstayed, for a period of 60 days;
or
(v) the Servicer or Special Servicer shall consent to the
appointment of a conservator or receiver or liquidator in any
insolvency, readjustment of
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debt, marshalling of assets and liabilities or similar
proceedings of or relating to the Servicer or the Special
Servicer, or of or relating to all or substantially all of the
property of either the Servicer or the Special Servicer; or
(vi) the Servicer or Special Servicer shall admit in writing its
inability to pay its debts generally as they become due, file
a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of
its creditors, or voluntarily suspend payment of its
obligations; or
(vii) the Servicer shall fail to make any Advance required to be
made by the Servicer hereunder (whether or not the Trustee or
the Fiscal Agent makes such Advance);
then, and in each and every such case, so long as an Event of Default shall not
have been remedied, the Trustee may, and at the written direction of the Holders
of at least 25% of the aggregate Voting Rights of all Certificates, the Trustee
shall, by notice in writing to the Servicer or the Special Servicer, as the case
may be, terminate all of its respective rights and obligations under this
Agreement and in and to the Mortgage Loans and the proceeds thereof, other than
any rights it may have hereunder as a Certificateholder and any rights or
obligations that accrued prior to the date of such termination (including the
right to receive all amounts accrued or owing to it under this Agreement, plus
interest at the Advance Rate on such amounts until received to the extent such
amounts bear interest as provided in this Agreement, with respect to periods
prior to the date of such termination, and the right to the benefits of Section
6.3 notwithstanding any such termination); provided, however, that in the event
the Servicer and the Special Servicer is the same Person, any termination of the
Servicer shall constitute a termination of the Special Servicer and vice versa.
On or after the receipt by the Servicer or the Special Servicer, as the case may
be, of such written notice, all of its authority and power under this Agreement,
whether with respect to the Certificates or the Mortgage Loans or otherwise,
shall pass to and be vested in the Trustee pursuant to and under this Section
(notwithstanding any failure of the Trustee to satisfy the criterion set forth
in Section 6.4) and, without limitation, the Trustee is hereby authorized and
empowered to execute and deliver, on behalf of and at the expense of the
defaulting Servicer or Special Servicer, as the case may be, as attorney-in-fact
or otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. Each of the Servicer and the Special Servicer, on behalf of itself,
agrees in the event it is terminated pursuant to this Section 7.1 promptly (and
in any event no later than ten Business Days subsequent to such notice) to
provide, at its own expense, the Trustee with all documents and records
requested by the Trustee to enable the Trustee to assume its functions
hereunder, and to cooperate with the Trustee and the successor to its
responsibilities hereunder in effecting the termination of its responsibilities
and rights hereunder, including, without limitation, the transfer to the
successor Servicer or Special Servicer or the Trustee, as applicable, for
administration by it of all cash amounts which shall at the time be or should
have been credited by the Servicer or the Special Servicer to the Collection
Account and any REO
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Account or Reserve Account or thereafter be received with respect to the
Mortgage Loans, and shall promptly provide the Trustee or such successor
Servicer or Special Servicer (which may include the Trustee), as applicable, all
documents and records reasonably requested by it, such documents and records to
be provided in such form as the Trustee or such successor Servicer or Special
Servicer shall reasonably request (including electromagnetic form), to enable it
to assume the Servicer's or Special Servicer's function hereunder. All
reasonable costs and expenses of the successor Servicer or successor Special
Servicer incurred in connection with transferring the Mortgage Files to the
successor Servicer (or copies of the Mortgage Files relating to Specially
Serviced Mortgage Loans to the Successor Special Servicer) and amending this
Agreement to reflect such succession as Servicer or successor Special Servicer
pursuant to this Section 7.1 shall be paid by the predecessor Servicer or
Special Servicer upon presentation of reasonable documentation of such costs and
expenses; provided, however, that if any such costs and expenses remain unpaid
by the predecessor Servicer or Special Servicer within a reasonable time after
presentation of such documentation, the Trustee may be reimbursed from the
Collection Account for such unpaid costs and expenses, which shall be deemed to
be expenses of the Trust Fund.
SECTION 7.2. Trustee to Act; Appointment of Successor.
On and after the time the Servicer or the Special Servicer receives
a notice of termination pursuant to Section 7.1, the Trustee shall be its
successor in such capacity in all respects under this Agreement and the
transactions set forth or provided for herein and, except as provided herein,
shall be subject to all the responsibilities, duties, limitations on liability
and liabilities relating thereto and arising thereafter placed on the Servicer
or Special Servicer by the terms and provisions hereof; provided, however, that
(i) the Trustee shall have no responsibilities, duties, liabilities or
obligations with respect to any act or omission of the Servicer or of the
Special Servicer and (ii) any failure to perform, or delay in performing, such
duties or responsibilities caused by the terminated party's failure to provide,
or delay in providing, records, tapes, disks, information or monies shall not be
considered a default by any successor hereunder. The appointment of a successor
Servicer or Special Servicer shall not affect any liability of the predecessor
Servicer or Special Servicer, as applicable, which may have arisen prior to its
termination as Servicer or Special Servicer. The Trustee shall not be liable for
any of the representations and warranties of the Servicer or of the Special
Servicer herein or in any related document or agreement, for any acts or
omissions of the predecessor Servicer or Special Servicer, as applicable, or for
any losses incurred in respect of any Permitted Investment by the Servicer
pursuant to Section 3.7 hereunder nor shall the Trustee be required to purchase
any Mortgage Loan hereunder. As compensation therefor, the Trustee as successor
Servicer or Special Servicer shall be entitled to all Servicing Compensation
relating to the Mortgage Loans that accrue after the date of the Trustee's
succession to which the Servicer or Special Servicer would have been entitled if
the Servicer or Special Servicer, as applicable, had continued to act hereunder.
In the event any Advances made by the Servicer or the Trustee shall at any time
be outstanding, or any amounts of interest thereon shall be accrued and unpaid,
all amounts available to repay Advances and interest hereunder shall be applied
entirely to the Advances made by the Trustee (and the accrued and unpaid
interest thereon), until such Advances made by the Trustee (and accrued and
unpaid interest thereon) shall have been repaid in full. Notwithstanding the
above, the Trustee may, if it shall be unwilling to so act, or shall,
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if it is unable to so act, or if the Holders of Certificates entitled to at
least 51% of the aggregate Voting Rights so request in writing to the Trustee,
or if (x) neither the Trustee nor the Fiscal Agent is rated by each Rating
Agency in one of its two highest long-term debt rating categories or (y) the
Trustee is not listed on S&P's list of approved servicers, promptly appoint, or
petition a court of competent jurisdiction to appoint, any established mortgage
loan servicing institution, the appointment of which will not result in the
downgrading, withdrawal or qualification of the rating or ratings then assigned
to any Class of Certificates as evidenced in writing by each Rating Agency, as
the successor to the Servicer or Special Servicer hereunder in the assumption of
all or any part of the responsibilities, duties or liabilities of the Servicer
or Special Servicer hereunder. No appointment of a successor to the Servicer or
Special Servicer hereunder shall be effective until the assumption by such
successor of all the Servicer's or Special Servicer's responsibilities, duties
and liabilities hereunder. Pending appointment of a successor to the Servicer or
Special Servicer hereunder, unless the Trustee shall be prohibited by law from
so acting, the Trustee shall act in such capacity as herein above provided. In
connection with such appointment and assumption described herein, the Trustee
may make such arrangements for the compensation of such successor out of
payments on Mortgage Loans as it and such successor shall agree; provided,
however, that no such compensation shall be in excess of that permitted the
terminated party hereunder. The Depositor, the Trustee, the Servicer or Special
Servicer and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession.
SECTION 7.3. Notification to Certificateholders.
(a) Upon any termination pursuant to Section 7.1 above or
appointment of a successor to the Servicer or the Special Servicer, the Trustee
shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register and to each Rating
Agency.
(b) Within 60 days after the occurrence of any Event of Default of
which a Responsible Officer of the Trustee has actual knowledge, the Trustee
shall transmit by mail to all Holders of Certificates and to each Rating Agency
notice of such Event of Default, unless such Event of Default shall have been
cured or waived.
SECTION 7.4. Other Remedies of Trustee.
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 7.1, shall have the right, in its own name as
trustee of an express trust, to take all actions now or hereafter existing at
law, in equity or by statute to enforce its rights and remedies and to protect
the interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filing of proofs of claim and debt in connection
therewith). In such event, the legal fees, expenses and costs of such action and
any liability resulting therefrom shall be expenses, costs and liabilities of
the Trust Fund, and the Trustee shall be entitled to be reimbursed therefor from
the Collection Account as provided in Section 3.6(vi). Except as otherwise
expressly provided in this Agreement, no remedy provided for by this Agreement
shall be exclusive of any other remedy,
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and each and every remedy shall be cumulative and in addition to any other
remedy and no delay or omission to exercise any right or remedy shall impair any
such right or remedy or shall be deemed to be a waiver of any Event of Default.
SECTION 7.5. Waiver of Past Events of Default; Termination.
The Holders of Certificates evidencing not less than 66-2/3% of the
aggregate Voting Rights of the Certificates may, on behalf of all Holders of
Certificates, waive any default by the Servicer or Special Servicer in the
performance of its obligations hereunder and its consequences, except a default
in making any required deposits to (including P&I Advances) or payments from the
Collection Account or the Distribution Account or in remitting payments as
received, in each case in accordance with this Agreement. Upon any such waiver
of a past default, such default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been remedied for every purpose of
this Agreement. No such waiver shall extend to any subsequent or other default
or impair any right consequent thereon.
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ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.1. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default of
which a Responsible Officer of the Trustee has actual knowledge and after the
curing or waiver of all Events of Default which may have occurred, undertakes to
perform such duties and only such duties as are specifically set forth in this
Agreement and no permissive right of the Trustee shall be construed as a duty.
During the continuance of an Event of Default of which a Responsible Officer of
the Trustee has actual knowledge, the Trustee shall exercise such of the rights
and powers vested in it by this Agreement, and use the same degree of care and
skill in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) The Trustee, upon receipt of any resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform on their face to the requirements of this Agreement; provided, however,
that, the Trustee shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document, order or
other instrument provided to it hereunder by the Servicer, the Special Servicer,
the Depositor, the Paying Agent or the Auction Agent. If any such instrument is
found not to conform on its face to the requirements of this Agreement in a
material manner, the Trustee shall take action as it deems appropriate to have
the instrument corrected.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; provided, however, that the foregoing
shall be subject to Section 8.2; and provided, further, that:
(i) Prior to the occurrence of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge, and
after the curing or waiver of all such Events of Default which
may have occurred, the duties and obligations of the Trustee
shall be determined solely by the express provisions of this
Agreement, the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically
set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the
Trustee and, in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed
therein, upon any resolutions, certificates, statements,
reports, opinions, documents, orders or other instruments
furnished to the Trustee that conform on their face to the
requirements of this Agreement without responsibility for
investigating the contents thereof;
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(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or
Responsible Officers, unless it shall be proven that the
Trustee was negligent in ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of Holders of
Certificates entitled to at least 51% of the aggregate Voting
Rights (or such other percentage as is specified herein) of
each affected Class, or of the aggregate Voting Rights of the
Certificates, relating to the time, method and place of
conducting any proceeding for any remedy available to the
Trustee, or exercising or omitting to exercise any trust or
power conferred upon the Trustee, under this Agreement; and
(iv) The Trustee shall not be charged with knowledge of any failure
by the Servicer or the Special Servicer to comply with the
obligations of the Servicer or the Special Servicer referred
to in clause (i) or (ii) of Section 7.1, or of any breach or
occurrence referred to in clause (iii) through (viii) of
Section 7.1, unless a Responsible Officer of the Trustee
obtains actual knowledge of such failure, breach or
occurrence. The Trustee shall be deemed to have actual
knowledge of the Servicer's or the Special Servicer's failure
to comply with its obligations listed in clause (i) of Section
7.1 or to provide scheduled reports, certificates and
statements when and as required to be delivered to the Trustee
pursuant to this Agreement.
The Trustee, in its capacity as Trustee, shall not be required to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if in the Trustee's opinion the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it, and none of the provisions contained in this Agreement shall in any event
require the Trustee to perform, or be responsible for the manner of performance
of, any of the obligations of the Servicer or the Special Servicer under this
Agreement, except pursuant to Sections 4.6 or 6.4 during such time, if any, as
the Trustee shall be the successor to, and be vested with the rights, duties,
powers and privileges of, the Servicer or the Special Servicer in accordance
with the terms of this Agreement. The Trustee shall not be required to post any
surety or bond of any kind in connection with its performance of its obligations
under this Agreement.
SECTION 8.2. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.1:
(i) The Trustee may request and/or rely upon and shall be
protected in acting or refraining from acting upon any
resolution, Officer's Certificate, certificate of auditors or
any other certificate, statement, instrument,
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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 and the Trustee shall have no responsibility
to ascertain or confirm the genuineness of any such party or
parties;
(ii) The Trustee may consult with counsel and any Opinion of
Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with
such Opinion of Counsel;
(iii) (A) The Trustee shall be under no obligation to institute,
conduct or defend any litigation hereunder or in relation
hereto at the request, order or direction of any of the
Certificateholders, pursuant to the provisions of this
Agreement, unless such Certificateholders shall have offered
to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which may be incurred therein
or thereby; (B) the right of the Trustee to perform any
discretionary act enumerated in this Agreement shall not be
construed as a duty, and the Trustee shall not be answerable
for other than its negligence or willful misconduct in the
performance of any such act; provided, however, that subject
to the foregoing clause (A), nothing contained herein shall
relieve the Trustee of the obligations, upon the occurrence of
an Event of Default (which has not been cured or waived) of
which a Responsible Officer of the Trustee has actual
knowledge, to exercise such of the rights and powers vested in
it by this Agreement, and to use the same degree of care and
skill in their exercise, as a prudent person would exercise or
use under the circumstances in the conduct of such person's
own affairs;
(iv) The Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and reasonably
believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
(v) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request,
consent, order, approval bond or other paper or document,
unless requested in writing to do so by Holders of
Certificates entitled to at least 51% (or such other
percentage as is specified herein) of the aggregate Voting
Rights of any affected Class; provided, however, that if the
payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Agreement, the Trustee may
require reasonable indemnity against such expense or liability
as a condition to taking any such action.
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The reasonable expense of every such investigation shall be
paid by the Servicer or the Special Servicer if an Event of
Default shall have occurred and be continuing relating to the
Servicer, or the Special Servicer, respectively, and otherwise
by the Certificateholders requesting the investigation; and
(vi) The Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or
through agents or attorneys. The Trustee shall not be liable
or responsible for the misconduct or negligence of any of the
Trustee's agents or attorneys appointed with due care by the
Trustee hereunder.
(b) Following the Start-up Day, the Trustee shall not, except as
expressly required by any provision of this Agreement, accept any contribution
of assets to the Trust Fund unless the Trustee shall have received an Opinion of
Counsel (the costs of obtaining such opinion to be borne by the Person
requesting such contribution) to the effect that the inclusion of such assets in
the Trust Fund will not cause either the Upper-Tier REMIC or the Lower-Tier
REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding or subject either the Upper-Tier REMIC or the Lower-Tier REMIC to
any tax under the REMIC Provisions or other applicable provisions of federal,
state and local law or ordinances.
(c) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.
The Trustee shall have no duty to conduct any affirmative
investigation as to the occurrence of any condition requiring the repurchase of
any Mortgage Loan by the Depositor pursuant to this Agreement or the eligibility
of any Mortgage Loan for purposes of this Agreement.
SECTION 8.3. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates shall not be
taken as the statements of the Trustee, the Fiscal Agent, the Servicer or the
Special Servicer and the Trustee, the Fiscal Agent, the Special Servicer and the
Servicer assume no responsibility for their correctness. The Trustee, the Fiscal
Agent, the Servicer and the Special Servicer make no representations or
warranties as to the validity or sufficiency of this Agreement, of the
Certificates, or any private placement memorandum or prospectus used to offer
the Certificates for sale or the validity, enforceability or sufficiency of any
Mortgage Loan or related document. The Trustee and the Fiscal Agent shall at no
time have any responsibility or liability for or with respect to the legality,
validity and enforceability of any Mortgage or any Mortgage Loan, or the
perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
Fund or its ability to generate the payments to be distributed to
Certificateholders under this Agreement. Without limiting the
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foregoing, neither the Trustee nor the Fiscal Agent shall be liable or
responsible for: the existence, condition and ownership of any Mortgaged
Property; the existence of any hazard or other insurance thereon (other than,
with respect to the Trustee only, if the Trustee shall assume the duties of the
Servicer pursuant to Section 7.2) or the enforceability thereof; the existence
of any Mortgage Loan or the contents of the related Mortgage File on any
computer or other record thereof (other than, with respect to the Trustee only,
if the Trustee shall assume the duties of the Servicer or the Special Servicer
pursuant to Section 7.2); the validity of the assignment of any Mortgage Loan to
the Trust Fund or of any intervening assignment; the completeness of any
Mortgage File; the performance or enforcement of any Mortgage Loan (other than,
with respect to the Trustee only, if the Trustee shall assume the duties of the
Servicer or the Special Servicer pursuant to Section 7.2); the compliance by the
Depositor, the Servicer or the Special Servicer with any warranty or
representation made under this Agreement or in any related document or the
accuracy of any such warranty or representation prior to the Trustee's receipt
of notice or other discovery of any non-compliance therewith or any breach
thereof; any investment of monies by or at the direction of the Servicer or the
Special Servicer or any loss resulting therefrom, it being understood that the
Trustee only shall remain responsible for any Trust Fund property that it may
hold in its individual capacity; the acts or omissions of any of the Depositor,
the Servicer or the Special Servicer (other than, with respect to the Trustee
only, if the Trustee shall assume the duties of the Servicer or the Special
Servicer pursuant to Section 7.2) or any subservicer or any Borrower; any action
of the Servicer or the Special Servicer (other than, with respect to the Trustee
only, if the Trustee shall assume the duties of the Servicer or the Special
Servicer pursuant to Section 7.2) or any subservicer taken in the name of the
Trustee, except with respect to the Trustee, to the extent such action is taken
at the express written direction of the Trustee; the failure of the Servicer or
the Special Servicer or any subservicer to act or perform any duties required of
it on behalf of the Trust Fund or the Trustee hereunder; or any action by or
omission of the Trustee taken at the instruction of the Servicer or the Special
Servicer (other than in each case, with respect to the Trustee only, if the
Trustee shall assume the duties of the Servicer or the Special Servicer pursuant
to Section 7.2) unless the taking of such action is not permitted by the express
terms of this Agreement; provided, however, that the foregoing shall not relieve
the Trustee or the Fiscal Agent of its obligation to perform its duties as
specifically set forth in this Agreement. Under no circumstances shall the
Fiscal Agent be liable under any of the circumstances described in the preceding
sentence. The Trustee and the Fiscal Agent shall not be accountable for the use
or application by the Depositor, the Servicer or the Special Servicer of any of
the Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor, the Servicer or the Special
Servicer in respect of the Mortgage Loans or deposited in or withdrawn from the
Collection Account, or the Distribution Account by the Depositor, the Servicer
or the Special Servicer, other than in each case, with respect to the Trustee
only, any funds held by the Trustee. The Trustee (unless the Trustee shall have
become the successor Servicer) or the Fiscal Agent shall have no responsibility
for (A) filing any financing or continuation statement in any public office at
any time or to otherwise perfect or maintain the perfection of any security
interest or lien granted to it hereunder or to record this Agreement, (B) seeing
to any insurance, (C) seeing to the payment or discharge of any tax, assessment,
or other governmental charge or any lien or encumbrance of any kind owing with
respect to, assessed or levied against any part of the Trust Fund, or (D)
confirming or verifying the contents of any reports or certificates of the
Servicer delivered to the Trustee pursuant to this Agreement believed by the
Trustee to be
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genuine and to have been signed or presented by the proper party or parties. In
making any calculation hereunder which includes as a component thereof the
payment or distribution of interest for a stated period at a stated rate "to the
extent permitted by applicable law," the Trustee shall assume that such payment
is so permitted unless a Responsible Officer of the Trustee has actual
knowledge, or receives an Opinion of Counsel (at the expense of the Person
asserting the impermissibility) to the effect, that such payment is not
permitted by applicable law.
SECTION 8.4. Trustee May Own Certificates.
The Trustee and the Fiscal Agent in their individual capacities or
any other capacity may become the owner or pledgee of Certificates, and may deal
with the Depositor, the Servicer and the Special Servicer in banking
transactions, with the same rights each would have if it were not Trustee or
Fiscal Agent.
SECTION 8.5. Payment of Trustee's Fees and Expenses;
Indemnification.
(a) The Servicer covenants and agrees to pay to the Trustee or any
successor Trustee from time to time, and the Trustee or any successor Trustee
shall be entitled to receive from the Servicer the Trustee Fee (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust) for all services rendered by the Trustee in the execution of
the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee.
(b) To the extent specifically permitted by Section 3.12(d), the
Trustee shall be paid or reimbursed from the Trust Fund upon its request for
expenses, disbursements and advances incurred or made by the Trustee pursuant to
and in accordance with any of the provisions of this Agreement except any such
expense, disbursement or advance as may arise from its negligence or bad faith;
provided, however, that the Trustee shall not refuse to perform any of its
duties hereunder solely as a result of the failure to be paid the Trustee Fee
and the Trustee's expenses.
The Servicer and the Special Servicer covenant and agree to pay or
reimburse the Trustee for the reasonable expenses, disbursements and advances
incurred or made by the Trustee in connection with any transfer of the servicing
responsibilities of the Servicer or the Special Servicer, as applicable
hereunder, pursuant to or otherwise arising from the resignation or removal of
the Servicer or the Special Servicer, as applicable, in accordance with any of
the provisions of this Agreement (and including the reasonable fees and expenses
and disbursements of its counsel and all other persons not regularly in its
employ), except any such expense, disbursement or advance as may arise from the
negligence or bad faith of the Trustee.
(c) Each of the Paying Agent, the Certificate Registrar, the
Custodian, the Servicer and the Special Servicer shall indemnify the Trustee and
the Fiscal Agent and their respective Affiliates and each of the directors,
officers, employees and agents of the Trustee, the Fiscal Agent and their
respective Affiliates (each, an "Indemnified Party"), and hold each of them
harmless against any, and all claims, losses, damages, penalties, fines,
forfeitures,
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reasonable and necessary legal fees and related costs, judgments, and any other
costs, fees and expenses that the Indemnified Party may sustain in connection
with this Agreement related to each such party's respective willful misconduct,
bad faith, fraud and/or negligence in the performance of its respective duties
hereunder or by reason of reckless disregard of its respective obligations and
duties hereunder (including in the case of the Servicer or the Special Servicer,
any agent of the Servicer or the Special Servicer).
(d) The Trust Fund shall indemnify each Indemnified Party from, and
hold it harmless against, any and all losses, liabilities, damages, claims or
expenses (including reasonable attorneys' fees) arising in respect of this
Agreement or the Certificates, in each case to the extent, and only to the
extent, such payments are expressly reimbursable under this Agreement or are
"unanticipated expenses incurred by the REMIC" within the meaning of Treasury
Regulations Section 1.860G-1(b)(3)(ii), other than (i) those resulting from the
negligence, fraud, bad faith or willful misconduct of the Trustee and (ii) those
as to which such Indemnified Party is entitled to indemnification pursuant to
Section 8.5(c). The term "unanticipated expenses incurred by a REMIC" shall
include any fees, expenses and disbursements of any separate trustee or
co-trustee appointed hereunder, only to the extent such fees, expenses and
disbursements were not reasonably anticipated as of the Closing Date and the
losses, liabilities, damages, claims or expenses (including reasonable
attorneys' fees) incurred or advanced by an Indemnified Party in connection with
any litigation arising out of this Agreement, including, without limitation,
under Section 2.3, Section 3.10, the third paragraph of Section 3.11, Section
8.11, Section 4.5, Section 5.1, and Section 7.1. The right of reimbursement of
the Indemnified Parties under this Section 8.5(d) shall be senior to the rights
of all Certificateholders.
(e) Notwithstanding anything herein to the contrary, this Section
8.5 shall survive the termination or maturity of this Agreement or the
resignation or removal of the Trustee as regards rights accrued prior to such
resignation or removal and (with respect to any acts or omissions during their
respective tenures) the resignation, removal or termination of the Servicer, the
Special Servicer, the Paying Agent, the Certificate Registrar or the Custodian.
(f) This Section 8.5 shall be expressly construed to include, but
not be limited to, such indemnities, compensation, expenses, disbursements,
advances, losses, liabilities, damages and the like, as may pertain or relate to
any environmental law or environmental matter.
SECTION 8.6. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or
association organized and doing business under the laws of any state or the
United States of America, authorized under such laws to exercise corporate trust
powers and to accept the trust conferred under this Agreement, having a combined
capital and surplus of at least $50,000,000 and a rating on its unsecured
long-term debt of at least "BBB" (or "AA" at any time when there is no Fiscal
Agent appointed and acting hereunder or any such Fiscal Agent so appointed has a
rating on its long-term unsecured debt that is lower than "AA" (without regard
to any plus or minus), unless each of the Rating Agencies has confirmed in
writing the appointment of such Fiscal Agent shall
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not result, in and of itself, in a downgrading, withdrawal or qualification of
the ratings then assigned by such Rating Agency to any Class of the
Certificates) from each Rating Agency, unless each of the Rating Agencies has
confirmed in writing that a lower rating shall not result, in and of itself, in
a downgrading, withdrawal or qualification of the rating then assigned by such
Rating Agency to any Class of the Certificates and subject to supervision or
examination by federal or state authority and shall not be an Affiliate of the
Servicer or the Special Servicer (except during any period when the Trustee has
assumed the duties of the Servicer or the Special Servicer, as applicable,
pursuant to Section 7.2). If a corporation or association publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for purposes of this Section
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. In the event that the place of business from which the Trustee
administers the Trust Fund is a state or local jurisdiction that imposes a tax
on the Trust Fund or the net income of a REMIC (other than a tax corresponding
to a tax imposed under the REMIC Provisions) the Trustee shall elect, at its
sole discretion, either to (i) resign immediately in the manner and with the
effect specified in Section 8.7, (ii) pay such tax and continue as Trustee or
(iii) administer the Trust Fund from a state and local jurisdiction that does
not impose such a tax. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, the Trustee shall
resign immediately in the manner and with the effect specified in Section 8.7.
SECTION 8.7. Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Depositor, the Servicer,
the Special Servicer and each Rating Agency. Upon such notice of resignation,
the Fiscal Agent shall also be deemed to have been removed and, accordingly, the
Servicer shall promptly appoint a successor Trustee, which appointment of
successor Trustee shall not result, in and of itself, in a downgrading,
withdrawal or qualification of the rating then assigned by the Rating Agencies
to any Class of the Certificates as confirmed in writing by each of the Rating
Agencies, and successor Fiscal Agent, which, if the successor Trustee is not
rated by each Rating Agency in one of its two highest long-term debt rating
categories, shall be confirmed in writing by each of the Rating Agencies that
such appointment of successor Fiscal Agent shall not result, in and of itself,
in a downgrading, withdrawal or qualification of the rating then assigned by
such Rating Agency to any Class of the Certificates by written instrument, in
triplicate, which instrument shall be delivered to the resigning Trustee, with a
copy to the fiscal agent deemed removed, and the successor Trustee and successor
Fiscal Agent. Notwithstanding the foregoing, if no successor Trustee and Fiscal
Agent shall have been so appointed and have accepted appointment within 30 days
after the giving of such notice of resignation, the resigning Trustee and
departing Fiscal Agent may petition any court of competent jurisdiction for the
appointment of a successor Trustee and successor Fiscal Agent.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.6 and shall fail to resign after written
request therefor by the Depositor or Servicer, or if at any time the Trustee or
the Fiscal Agent shall become incapable of acting, or shall be adjudged bankrupt
or insolvent, or a receiver of the Trustee or the Fiscal Agent or
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of its property shall be appointed, or any public officer shall take charge or
control of the Trustee or the Fiscal Agent or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation, then the Depositor or
the Servicer may remove the Trustee and the Fiscal Agent and shall promptly
appoint a successor Trustee and successor Fiscal Agent by written instrument,
which shall be delivered to the Trustee and the Fiscal Agent so removed and to
the successor Trustee and successor Fiscal Agent.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and the Fiscal Agent (and any removal
of the Trustee shall be deemed to be a removal also of the Fiscal Agent) and
appoint a successor Trustee and successor Fiscal Agent (each meeting the
requirements of Section 8.8) by written instrument or instruments, in eight
originals, signed by such Holders or their attorneys-in-fact duly authorized,
one complete set of which instruments shall be delivered to the Depositor, one
complete set to the Servicer, one complete set to the Special Servicer, one
complete set to the Trustee so removed, one complete set to the Fiscal Agent
deemed removed, one complete set to the successor Trustee so appointed and one
complete set to the successor Fiscal Agent so appointed.
In the event of the resignation or removal of the Trustee, the
Fiscal Agent shall be entitled to resign, it being understood that the initial
Fiscal Agent shall not be obligated to act in such capacity hereunder at any
time that LaSalle National Bank is not the Trustee.
Any resignation or removal of the Trustee and Fiscal Agent and
appointment of a successor Trustee and, if such trustee is not rated by each
Rating Agency in one of its two highest long-term debt rating categories, a
successor Fiscal Agent pursuant to any of the provisions of this Section 8.7
shall not become effective until acceptance of appointment by the successor
Trustee and, if necessary, Fiscal Agent as provided in Section 8.8.
SECTION 8.8. Successor Trustee.
Any successor Trustee and any successor Fiscal Agent appointed as
provided in Section 8.7 shall execute, acknowledge and deliver to the Depositor
and to the predecessor Trustee and predecessor Fiscal Agent, as the case may be,
instruments accepting their appointment hereunder, and thereupon the resignation
or removal of the predecessor Trustee and predecessor Fiscal Agent shall become
effective and such successor Trustee and successor Fiscal Agent, without any
further act, deed or conveyance, shall become fully vested with all the rights,
powers, duties and obligations of its predecessor hereunder, with the like
effect as if originally named as Trustee herein, provided that each Rating
Agency shall have confirmed in writing that the appointment of such successor
Trustee and successor Fiscal Agent shall not result, in and of itself, in a
downgrading, withdrawal or qualification of the rating then assigned by such
Rating Agency to any Class of the Certificates. The predecessor Trustee shall
deliver to the successor Trustee all Mortgage Files and related documents and
statements held by it hereunder, and the Depositor, the predecessor Trustee and
predecessor Fiscal Agent shall execute and deliver such instruments and do such
other things as may reasonably be required for more fully and certainly vesting
and confirming in the successor Trustee and successor Fiscal Agent all such
rights, powers, duties and obligations. No successor Trustee or successor Fiscal
Agent shall accept appointment as provided in this Section 8.8 unless at the
time of such
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acceptance such successor Trustee or successor Fiscal Agent shall be eligible
under the provisions of Section 8.6.
Upon acceptance of appointment by a successor Trustee or successor
Fiscal Agent as provided in this Section 8.8, the successor Trustee shall mail
notice of the succession of such Trustee and Fiscal Agent hereunder to all
Holders of Certificates at their addresses as shown in the Certificate Register.
SECTION 8.9. Merger or Consolidation of Trustee.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such corporation shall be eligible under the provisions of Section
8.6, 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.
Any Person into which the Fiscal Agent may be merged or converted or with which
it may be consolidated or any corporation or bank resulting from any merger,
conversion or consolidation to which the Fiscal Agent shall be a party, or any
corporation or banking association succeeding to all or substantially all of the
corporate trust business of the Fiscal Agent shall be the successor of the
Fiscal Agent hereunder, provided that such corporation or bank shall be eligible
under the provisions of Section 8.6 without the execution or filing of any paper
or any farther act on the part of any of the parties hereto, anything to the
contrary notwithstanding.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing the same may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act (at the expense of the Trustee) as co-trustee or co-trustees,
jointly with the Trustee, or separate trustee or separate trustees, of all or
any part of the Trust Fund, and to vest in such Person or Persons, in such
capacity, such title to the Trust Fund, or any part thereof, and, subject to the
other provisions of this Section 8.10, such powers, duties, obligations, rights
and trusts as the Depositor and the Trustee may consider necessary or desirable.
If the Depositor shall no longer be in existence or shall not have joined in
such appointment within 15 days after the receipt by it of a request so to do,
or in case an Event of Default shall have occurred and be continuing, the
Trustee alone shall have the power to make such appointment. Except as required
by applicable law, the appointment of a co-trustee or separate trustee shall not
relieve the Trustee of its responsibilities hereunder. No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as a
successor Trustee under Section 8.6 hereunder and no notice to Holders of
Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be
required under Section 8.8 hereof.
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In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in such act), except to
the extent that under any law of any jurisdiction in which any particular act or
acts are to be performed (whether as Trustee hereunder or as successor to the
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust Fund or any portion thereof in any
such jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee solely at the direction of the Trustee.
No trustee under this Agreement shall be personally liable by reason
of any act or omission of any other trustee under this Agreement. The Depositor
and the Trustee acting jointly may at any time accept the resignation of or
remove any separate trustee or co-trustee, except that if the Depositor is no
longer in existence, or if the separate trustee or co-trustee is an employee of
the Trustee, the Trustee acting alone may accept the resignation of or remove
any separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Every such instrument shall be filed with the Trustee.
Each separate trustee and co-trustee, upon its acceptance of the trusts
conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Trustee or separately, as may
be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. In no
event shall any such separate trustee or co-trustee be entitled to any provision
relating to the conduct of, affecting the liability of, or affording protection
to such separate trustee or co-trustee that imposes a standard of conduct less
stringent than that imposed on the Trustee hereunder, affording greater
protection than that afforded to the Trustee hereunder or providing a greater
limit on liability than that provided to the Trustee hereunder.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts hereunder shall vest in and be exercised
by the Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
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SECTION 8.11. Authenticating Agent.
The Trustee may appoint an Authenticating Agent to execute and to
authenticate Certificates. The Authenticating Agent must be acceptable to the
Depositor and the Servicer and must be a corporation organized and doing
business under the laws of the United States of America or any state, having a
principal office and place of business in a state and city acceptable to the
Depositor and the Servicer, having a combined capital and surplus of at least
$15,000,000, authorized under such laws to do a trust business and subject to
supervision or examination by federal or state authorities. The Trustee shall
serve as the initial Authenticating Agent and the Trustee hereby accepts such
appointment.
Any corporation into which the Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Authenticating Agent
shall be party, or any corporation succeeding to the corporate agency business
of the Authenticating Agent, shall be the Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.
The Authenticating Agent may at any time resign by giving at least
30 days' advance written notice of resignation to the Trustee, the Depositor,
the Special Servicer and the Servicer. The Trustee may at any time terminate the
agency of the Authenticating Agent by giving written notice of termination to
the Authenticating Agent, the Depositor, the Special Servicer and the Servicer.
Upon receiving a notice of resignation or upon such a termination, or in case at
any time the Authenticating Agent shall cease to be eligible in accordance with
the provisions of this Section 8.11, the Trustee promptly shall appoint a
successor Authenticating Agent, which shall be acceptable to the Servicer and
the Depositor, and shall mail notice of such appointment to all
Certificateholders. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers, duties
and responsibilities of its predecessor hereunder, with like effect as if
originally named as Authenticating Agent herein. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this Section
8.11.
The Authenticating Agent shall have no responsibility or liability
for any action taken by it as such at the direction of the Trustee. The Trustee
shall pay the Authenticating Agent reasonable compensation from its own funds.
SECTION 8.12. Appointment of Custodians.
The Trustee may appoint one or more Custodians to hold all or a
portion of the Mortgage Files as agent for the Trustee, by entering into a
Custodial Agreement. The Trustee agrees to comply with the terms of each
Custodial Agreement and to enforce the terms and provisions thereof against the
Custodian for the benefit of the Certificateholders. Each Custodian shall be a
depository institution subject to supervision by federal or state authority,
shall have a combined capital and surplus of at least $10,000,000, shall have a
long-term debt rating of at least "BBB" from each Rating Agency, unless each of
the Rating Agencies has confirmed in writing that a lower rating shall not
result, in and of itself, in a downgrading,
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withdrawal or qualification of the rating then assigned by such Rating Agency to
any Class of the Certificates, and shall be qualified to do business in the
jurisdiction in which it holds any Mortgage File. Each Custodial Agreement may
be amended only as provided in Section 10.7. The Trustee shall pay the Custodian
reasonable compensation from its own funds. The Trustee shall serve as the
initial Custodian.
SECTION 8.13. Fiscal Agent Appointed; Concerning the Fiscal Agent.
(a) The Trustee hereby appoints ABN AMRO Bank N.V. as the initial
Fiscal Agent hereunder for the purposes of exercising and performing the
obligations and duties imposed upon the Fiscal Agent by Sections 3.22, 4.6 and
7.2.
(b) The Fiscal Agent undertakes to perform such duties and only such
duties as are specifically set forth in Sections 3.22, 4.6 and 7.2.
(c) No provision of this Agreement shall be construed to relieve the
Fiscal Agent from liability for its own negligent failure to act, bad faith or
its own willful misfeasance; provided, however, that (i) the duties and
obligations of the Fiscal Agent shall be determined solely by the express
provisions of Sections 3.22, 4.6 and 7.2, the Fiscal Agent shall not be liable
except for the performance of such duties and obligations, no implied covenants
or obligations shall be read into this Agreement against the Fiscal Agent and,
in the absence of bad faith on the part of the Fiscal Agent, the Fiscal Agent
may conclusively rely, as to the truth and correctness of the statements or
conclusions expressed therein, upon any resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Fiscal Agent by the Depositor, the Servicer, the Special Servicer or the Trustee
and which on their face do not contradict the requirements of this Agreement,
and (ii) the provisions of clause (ii) of Section 8.1(c) shall apply to the
Fiscal Agent.
(d) Except as otherwise provided in Section 8.1(c), the Fiscal Agent
also shall have the benefit of provisions of clauses (i), (ii), (iii) (other
than the proviso thereto), (iv), (v) (other than the proviso thereto) and (vi)
of Section 8.2(a).
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ARTICLE IX
TERMINATION
SECTION 9.1. Termination.
(a) The respective obligations and responsibilities of the
Servicer, the Special Servicer, the Depositor, the Trustee and the Fiscal Agent
created hereby with respect to the Certificates (other than the obligation to
make certain payments and to send certain notices to Certificateholders as
hereinafter set forth) shall terminate immediately following the occurrence of
the last action required to be taken by the Trustee pursuant to this Article IX
on the Termination Date; provided, however, that in no event shall the trust
created hereby continue beyond the expiration of twenty-one years from the death
of the survivor of the descendants of Joseph P. Kennedy, the late ambassador of
the United States to the United Kingdom, living on the date hereof.
(b) The Trust Fund, the Upper-Tier REMIC and the Lower-Tier REMIC
shall be terminated and the assets of the Trust Fund shall be sold or otherwise
disposed of in connection therewith, only pursuant to a "plan of complete
liquidation" within the meaning of Code Section 860F(a)(4)(A) providing for the
actions contemplated by the provisions hereof pursuant to which the applicable
Notice of Termination is given and requiring that the Trust Fund, the Upper-Tier
REMIC and the Lower-Tier REMIC shall terminate on a Distribution Date occurring
not more than 90 days following the date of adoption of the plan of complete
liquidation. For purposes of this Section 9.1(b), the Notice of Termination
given pursuant to Section 9.1(c) shall constitute the adoption of the plan of
complete liquidation as of the date such notice is given, which date shall be
specified by the Trustee in the final federal income tax returns of the
Upper-Tier REMIC and the Lower-Tier REMIC.
(c) If the Trust Fund has not been previously terminated pursuant
to subsection (d) of this Section 9.1, the Special Servicer may effect an early
termination of the Trust Fund, upon not less than 30 days' prior Notice of
Termination given to the Trustee and the Servicer any time on or after the Early
Termination Notice Date specifying the Anticipated Termination Date, by
purchasing on such date all, but not less than all, of the Mortgage Loans then
included in the Trust Fund, and all property acquired in respect of any Mortgage
Loan, at a purchase price, payable in cash, equal to not less than the greater
of:
(i) the sum of
(A) 100% of the unpaid principal balance of each Mortgage
Loan included in the Trust Fund as of the last day of
the month preceding such Distribution Date;
(B) the fair market value of all other property included in
the Trust Fund as of the last day of the month preceding
such Distribution Date, as determined by an Independent
appraiser acceptable to the
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Servicer as of the date not more than 30 days prior to
the last day of the month preceding such Distribution
Date;
(C) all unpaid interest accrued on such principal balance of
each such Mortgage Loan (including for this purpose any
Mortgage Loan as to which title to the related Mortgaged
Property has been acquired) at the Mortgage Rate to the
last day of the month preceding such Distribution Date;
(D) the aggregate amount of unreimbursed Advances (with
interest thereon at the Advance Rate) and unpaid Trust
Fund expenses; or
(ii) the aggregate fair market value of the Mortgage Loans, and all
other property acquired in respect of any Mortgage Loan in the
Trust Fund, on the last day of the month preceding such
Distribution Date, as determined by an Independent appraiser
acceptable to the Servicer as of a date not more than 30 days
prior to the last day of the month preceding such Distribution
Date, together with one month's interest thereon at the
Mortgage Rate and disposition expenses.
Any Holder of a Class LR Certificate representing greater than a 50%
Percentage Interest in such Class, the Servicer or the Depositor may also effect
such termination as provided above if it first notifies the Special Servicer
through the Trustee of its intention to do so in writing at least 30 days prior
to the Early Termination Notice Date and the Special Servicer does not terminate
the Trust Fund as described above within such 30 day period. All costs and
expenses incurred by any party to this Agreement or by the Trust Fund in
connection with the purchase of the Mortgage Loans and other assets of the Trust
Fund pursuant to this Section 9.1(c) shall be borne by the party exercising its
purchase rights hereunder. The Trustee shall be entitled to rely conclusively on
any determination made by an Independent appraiser pursuant to this subsection
(c).
(d) If the Trust Fund has not been previously terminated pursuant
to subsection (c) of this Section 9.1, on or after the Auction Valuation Date,
the Trustee shall conduct an auction of the Mortgage Loans in accordance with
the following principles:
(i) The Trustee shall request that four Independent financial
advisory or investment banking or investment brokerage firms
nationally recognized in the field of real estate analysis and
reasonably acceptable to the Servicer and the Special Servicer
provide the Trustee with an estimated value at which the
Mortgage Loans and all other property in respect of any
Mortgage Loan in the Trust Fund could be sold at an auction.
If the aggregate value of the Mortgage Loans and such
property, as determined by the average of the three highest
such estimates, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates outstanding as of the
close of business on the Auction Valuation Date (the
"Aggregate Certificate Balance ") plus the Auction Fees,
Servicing Fees, Trustee Fees
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and all other incidental expenses, the Trustee shall (A) adopt
a "plan of complete liquidation", as required by Section
9.1(b) hereof, and (B) appoint an Auction Agent to solicit
offers from Qualified Offerors to purchase all (but not less
than all) of the Mortgage Loans and such property in
accordance with the Auction Procedures for a price that is not
less than the Aggregate Certificate Balance plus the Auction
Fees, Servicing Fees, Trustee Fees and all other incidental
expenses. In the event that there is an auction of the
Mortgage Loans and such property the Auction Agent shall be
authorized to employ Independent attorneys and other
Independent professional consultants (including, without
limitation, appraisers and environmental consultants) as
reasonably required to conduct such sale.
(ii) In determining the Aggregate Certificate Balance, there shall
be included all Certificates owned by or on behalf of the
Depositor, the Servicer, the Trustee, a Manager or a Borrower
or any Affiliate thereof, notwithstanding the proviso in the
first sentence of the definition of the term
"Certificateholder."
(iii) The Trustee shall reject every bid that the Auction Agent
advises the Trustee in writing (a) is from a Person other than
a Qualified Offeror, (b) provides for a purchase price that is
less than the Aggregate Certificate Balance plus the Auction
Fees, Servicing Fees, Trustee Fees and all other incidental
expenses, (c) provides for purchase on terms other than
all-cash or (d) is contingent on the occurrence or
non-occurrence of any event (each, a "Deficient Auction Bid
"). If all bids received by the Trustee are Deficient Auction
Bids, as advised by the Auction Agent, the Mortgage Loans and
such property shall not be sold and there shall be no
termination of the Trust Fund pursuant to this Section 9.1(d).
(iv) The Trustee shall accept the highest bid that is not a
Deficient Auction Bid and shall deliver a Notice of
Termination to the Servicer, the Special Servicer and the
Certificateholders specifying the Anticipated Termination Date
(which shall be first Distribution Date following the date of
closing of the sale of the Mortgage Loans and such property).
The Trustee shall sell the Mortgage Loans and such property to
the successful bidder at a closing to be held no later than
the Remittance Date immediately preceding the Auction Proceeds
Distribution Date.
(v) The Trustee shall be entitled to be reimbursed from the
Collection Account for expenses (which shall be deemed to be
expenses of the Trust Fund) that it or the Auction Agent on
its behalf incurs pursuant to this Section 9.1(d) in
connection with the valuation and sale of the Mortgage Loans
and such property (collectively, the "Auction Fees"),
including all fees and reasonable expenses of legal counsel
and other professional consultants retained by either of the
Trustee or the Auction Agent. The
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Trustee shall not be personally liable for any act or omission
of the Auction Agent hereunder or any Independent attorneys
and other Independent professional consultants appointed by
the Auction Agent.
(vi) Any auction shall be conducted in accordance with auction
procedures to be developed by the auction agent in connection
with such auction (the "Auction Procedures"), provided that
such procedures shall include at a minimum provisions
substantially to the effect that: (i) no due diligence of the
Servicer's, the Special Servicer's or the Trustee's records
with respect to the Mortgage Loans may be conducted by any
bidder prior to being notified that it has submitted the
highest bid; (ii) the Auction Agent is entitled to require
that the highest bidder provide a non-refundable good faith
deposit sufficient to reimburse the Trustee and the Auction
Agent for all expenses in connection with the evaluation of
such bid and in connection with such highest bidder's due
diligence, (iii) each bidder may be required to enter into a
confidentiality agreement with the Servicer, the Special
Servicer, the Auction Agent and the Trustee prior to being
permitted to conduct due diligence, (iv) Borrowers on any of
the Mortgage Loans shall be prohibited from submitting bids,
and (v) in the event that the highest bidder withdraws, the
next highest bidder shall be permitted to conduct due
diligence as if it were the highest bidder.
(e) If the Trust Fund has not been previously terminated pursuant
to subsection (c) or (d) of this Section 9.1, the Trustee shall determine as
soon as practicable the Distribution Date on which the Trustee reasonably
anticipates, based on information with respect to the Mortgage Loans previously
provided to it, that the final distribution will be made (i) to the Holders of
outstanding Regular Certificates, and to the Trustee in respect of the
Lower-Tier Regular Interests notwithstanding that such distribution may be
insufficient to distribute in full the Certificate Balance of each Certificate
or Lower-Tier Regular Interest, together with amounts required to be distributed
on such Distribution Date pursuant to Section 4.1(a) or (ii) if no such Classes
of Certificates are then outstanding, to the Holders of the Class LR
Certificates of any amount remaining in the Collection Account and to the
Holders of the Class R Certificates of any amount remaining in the Distribution
Account, in either case, following the later to occur of (A) the receipt or
collection of the last payment due on any Mortgage Loan included in the Trust
Fund or (B) the liquidation or disposition pursuant to Section 3.18 of the last
asset held by the Trust Fund.
(f) Notice of any termination of the Trust Fund pursuant to this
Section 9.1 shall be mailed by the Trustee to affected Certificateholders with a
copy to the Servicer and each Rating Agency at their addresses shown in the
Certificate Registrar as soon as practicable after the Trustee shall have
received, given or been deemed to have received a Notice of Termination but in
any event not more than thirty days, and not less than ten days, prior to the
Anticipated Termination Date. The notice mailed by the Trustee to affected
Certificateholders shall:
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(i) specify the Anticipated Termination Date on which the final
distribution is anticipated to be made to Holders of
Certificates of the Classes specified therein;
(ii) specify the amount of any such final distribution, if known;
and
(iii) state that the final distribution to Certificateholders will
be made only upon presentation and surrender of Certificates
at the office of the Paying Agent therein specified.
If the Trust Fund is not terminated on any Anticipated Termination Date for any
reason, the Trustee shall promptly mail notice thereof to each affected
Certificateholder.
(g) Any funds not distributed on the Termination Date because of
the failure of any Certificateholders to tender their Certificates shall be set
aside and held in trust for the account of the appropriate non-tendering
Certificateholders, whereupon the Trust Fund shall terminate. If any
Certificates as to which notice of the Termination Date has been given pursuant
to this Section 9.1 shall not have been surrendered for cancellation within six
months after the time specified in such notice, the Trustee shall mail a second
notice to the remaining Certificateholders, at their last addresses shown in the
Certificate Register, to surrender their Certificates for cancellation in order
to receive, from such funds held, the final distribution with respect thereto.
If within one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Trustee may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds in trust and of contacting Certificateholders shall be paid out of such
funds. If within two years after the second notice, any such Certificates shall
not have been surrendered for cancellation, the Paying Agent shall pay to the
Servicer all amounts distributable to the Holders thereof, at which time the
obligations of the Trustee to such Holders with respect to such amounts shall
terminate, and the Servicer shall thereafter hold such amounts for the benefit
of such Holders. No interest shall accrue or be payable to any Certificateholder
on any amount held as a result of such Certificateholder's failure to surrender
its Certificate(s) for final payment thereof in accordance with this Section
9.1. Such funds held by the Servicer shall not be invested.
SECTION 9.2. Additional Termination Requirements.
In the event that (a) the holder of a Class LR Certificate
representing greater than a 50% Percentage Interest in such Class, the Servicer
or the Depositor exercises its purchase option as provided in Section 9.1(c) or
(b) the procedures for sale of all Mortgage Loans as provided in Section 9.1(d)
are initiated, the Trust Fund shall be terminated in accordance with the
following additional requirements: provided that the Trustee has received an
Opinion of Counsel or other evidence to the effect that the termination of the
Trust Fund (i) will constitute a "qualified liquidation" of each of the
Upper-Tier REMIC and the Lower-Tier REMIC within the meaning of Code Section
860F(a)(4)(A-3) and (ii) will not subject either the Upper-Tier REMIC or the
Lower-Tier REMIC to tax or cause either the Upper-Tier REMIC or the
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Lower-Tier REMIC to fail to qualify as a REMIC at any time that any Certificates
are outstanding:
(a) The notice given by the holder of a Class LR Certificate
representing greater than a 50% Percentage Interest in such Class, under Section
9.1 shall provide that such notice constitutes the adoption of a plan of
complete liquidation of the Trust Fund as of the date of such notice (or, if
earlier, the date on which the first such notice is mailed to the Trustee and
the Servicer). The Trustee shall also specify such date in a statement attached
to the final tax returns of each of the Upper-Tier REMIC and the Lower-Tier
REMIC; and
(b) At or after the time of adoption of such a plan of complete
liquidation and at or prior to the Final Distribution Date, the Trustee shall
sell all of the assets of the Trust Fund to the holder of such Class LR
Certificates, the Servicer or the Depositor (or otherwise pursuant to the
provisions of Section 9.1(d)) for cash at the purchase price specified in
Section 9.1 and shall distribute such cash in the manner specified in Section
9.1.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original, and
such counterparts shall constitute but one and the same instrument.
SECTION 10.2. Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right to institute any suit,
action or proceeding in equity or at law upon or under or with respect to this
Agreement or the Mortgage Loans, unless, with respect to this Agreement, such
Holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and unless also the
Holders of Certificates representing at least 25% of the aggregate Voting Rights
allocated to each affected Class of Certificates shall have made written request
upon the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 30 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding. It is understood and intended,
and expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
of any Class shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the equal,
ratable and common benefit of all Holders of Certificates of such Class. For the
protection and enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
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SECTION 10.3. Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES) AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
SECTION 10.4. Notices.
All demands, notices and communications hereunder shall be in
writing, shall be deemed to have been given upon receipt (or, in the case of
notice by telecopy, upon confirmation of receipt) as follows:
If to the Trustee or the Fiscal Agent, to:
LaSalle National Bank or ABN AMRO Bank, N.V.
135 South LaSalle Street
Suite 200
Chicago, Illinois 60603
Attention: Asset-Backed Securities
Trust Services, Prudential 1995-MCF-2
With copies to:
Mayer Brown & Platt
2000 Pennsylvania Avenue N.W.
Washington, D.C. 20006
Attention: David Zielke, Esq.
Telecopy No.: (202) 861-0473
If to the Depositor, to:
Prudential Securities Secured Financing Corporation
One New York Plaza
New York, New York 10292
Attention: Head of Commercial Mortgage Group
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With copies to:
O'Melveny & Myers
Citicorp Center
153 East 53rd Street
New York, New York 10022
Attention: Laurence G. Preble, Esq.
Telecopy No.: (212) 326-2061
If to the Servicer, to:
Midland Loan Services, L.P.
2001 Shawnee Mission Parkway
Shawnee Mission, Kansas 66205
Attention: Alan L. Atterbury
Telecopy No.: (913) 384-0413
With copies to:
Morrison & Hecker L.L.P.
2600 Grand Avenue
Kansas City, Missouri 64108-4606
Attention: William A. Hirsch, Esq.
Telecopy No.: (816) 474-4208
If to the Special Servicer, to:
Lennar Partners, Inc.
700 N.W. 107th Avenue
Miami, Florida 33172
Attention: Jeffrey Krasnoff
Telecopy No.: (305) 226-7691
With copies to:
Rubin Baum Levin Constant Friedman & Bilzin
2500 First Union Financial Center
Miami, Florida 33131
Attention: Brian J. Bilzin
Telecopy No.: (305) 374-7593
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If to the Mortgage Loan Seller, to:
Midland Loan Services, L.P.
2001 Shawnee Mission Parkway
Shawnee Mission, Kansas 66205
Attention: Alan L. Atterbury
Telecopy No.: (913) 384-0413
With copies to:
Morrison & Hecker L.L.P.
2600 Grand Avenue
Kansas City, Missouri 64108-4606
Attention: William A. Hirsch, Esq.
Telecopy No.: (816) 474-4200
If to any Certificateholder, to:
the address set forth in the
Certificate Register,
or, in the case of the parties to this Agreement, to such other address as such
party shall specify by written notice to the other parties hereto.
SECTION 10.5. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever held invalid, then, to the
extent permitted by applicable law, such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.
SECTION 10.6. Notice to the Depositor and Each Rating Agency.
(a) The Trustee shall use its best efforts to promptly provide
written notice to the Depositor and each Rating Agency with respect to each of
the following of which a Responsible Officer of the Trustee has actual
knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Event of Default that has not been
cured;
(iii) the merger, consolidation, resignation or termination of the
Servicer, Special Servicer, Trustee or Fiscal Agent;
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(iv) the repurchase of Mortgage Loans pursuant to Section 2.3(d) or
2.3(e);
(v) the final payment to any Class of Certificateholders;
(vi) each report to Certificateholders described in Section 4.2;
(b) The Servicer shall promptly furnish to each Rating Agency
copies of the following:
(i) each of its annual statements as to compliance described in
Section 3.14;
(ii) each of its annual independent public accountants' servicing
reports described in Section 3.15.
(iii) annual reports of each Borrower with respect to the net
operating income and occupancy rates required to be delivered
by the related Mortgage and actually received by the Servicer
pursuant thereto to the extent consistent with applicable law
and the related Mortgage Loan Documents.
(c) The Special Servicer, shall furnish each Rating Agency with
such information with respect to any Specially Serviced Mortgage Loan as such
Rating Agency shall request and which the Special Servicer can obtain to the
extent consistent with applicable law and the related Mortgage Loan Documents.
(d) Notices to each Rating Agency shall be addressed as follows:
Standard & Poor's Ratings Services
25 Broadway
New York, New York 10004
Attention: Commercial Mortgage Surveillance
Fitch Investors Service, L.P.
One State Street Plaza
New York, New York 10004
Attention: Commercial Mortgage Surveillance
Duff & Phelps Credit Rating Co.
55 East Monroe Street
Chicago, Illinois 60603
Attention: Commercial Mortgage Monitoring and Surveillance
or in each case to such other address as any Rating Agency shall specify by
written notice to the parties hereto.
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SECTION 10.7. Amendment.
This Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Servicer, the Special Servicer, the Trustee and
the Fiscal Agent, without the consent of any of the Certificateholders, (i) to
cure any ambiguity, (ii) to correct or supplement any provisions herein or
therein that may be inconsistent with any other provisions herein or therein,
(iii) to amend any provision hereof to the extent necessary or desirable to
maintain the rating or ratings assigned to each of the Classes of Regular
Certificates by each Rating Agency, or (iv) to make any other provisions with
respect to matters or questions arising under this Agreement, which shall not be
inconsistent with the provisions of this Agreement and will not result in the
downgrading, withdrawal or qualification of the rating or ratings then assigned
to any outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, in all cases, which, as evidenced by an Opinion of Counsel at the
expense of the party (other than the Trustee, unless such amendment modifies or
otherwise relates solely to the obligations, duties or rights of the Trustee)
requesting such amendment, shall not adversely affect in any material respect
the interests of any Certificateholder.
This Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66-2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Agreement or of modifying in any manner the rights of
the Certificateholders; provided, however, that no such amendment shall:
(i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be
distributed on any Certificate without the consent of each
affected Certificateholder;
(ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or
inaction under this Agreement, without the consent of the
Holders of all Certificates then outstanding; or
(iii) alter the servicing standard set forth in Section 3.1 or the
obligations of the Servicer, the Trustee or the Fiscal Agent
to make a P&I Advance or Property Advance without the consent
of the Holders of all Certificates representing all of the
Voting Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer, the
Trustee and the Fiscal Agent, at any time and from time to time, without the
consent of the Certificateholders, may amend this Agreement or any Custodial
Agreement to modify, eliminate or add to any of its provisions to such extent as
shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an Opinion of Counsel (obtained at
the expense of the Trust Fund), is
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necessary or helpful to maintain such qualification or to prevent the imposition
of any such taxes, and would not adversely affect in any material respect the
interest of any Certificateholder.
In the event that neither the Depositor nor the successor thereto,
if any, is in existence, any amendment under this Section 10.7 shall be
effective with the consent in writing of the Trustee, the Fiscal Agent, the
Servicer, the Special Servicer, and, to the extent required by this Section, the
Certificateholders and each Rating Agency.
Promptly after the execution of any amendment, the Servicer shall
furnish written notification of the substance of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 10.7 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The method of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe; provided, however,
that such method shall always be by affirmation and in writing.
Notwithstanding any contrary provision of this Agreement, no
amendment shall be made to this Agreement or any Custodial Agreement unless the
Servicer and the Trustee shall have received an Opinion of Counsel, at the
expense of the party requesting such amendment (or, if such amendment is
required by any Rating Agency to maintain the rating issued by it or requested
by the Trustee for any purpose described in clause (i) or (ii) of the first
sentence of this Section, then at the expense of the Trust Fund), to the effect
that such amendment will not cause either the Upper-Tier REMIC or Lower-Tier
REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding or cause a tax to be imposed on the Trust Fund under the REMIC
Provisions (other than a tax at the highest marginal corporate tax rate on net
income from foreclosure property).
Prior to the execution of any amendment to this Agreement or any
Custodial Agreement, the Trustee, the Fiscal Agent, the Special Servicer and the
Servicer shall be entitled to receive and rely conclusively upon an Opinion of
Counsel, at the expense of the party requesting such amendment (or, if such
amendment is required by any Rating Agency to maintain the rating issued by it
or requested by the Trustee for any purpose described in clause (i), (ii) or
(iv) (which do not modify or otherwise relate solely to the obligations, duties
or rights of the Trustee) of the first sentence of this Section, then at the
expense of the Trust Fund) stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee may, but shall not be
obligated to, enter into any such amendment which affects the Trustee's own
rights, duties or immunities under this Agreement.
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SECTION 10.8. Confirmation of Intent.
It is the express intent of the parties hereto that the conveyance
of the Trust Fund (including the Mortgage Loans) by the Depositor to the Trustee
on behalf of Certificateholders as contemplated by this Agreement and the sale
by the Depositor of the Certificates be, and be treated for all purposes as, a
sale by the Depositor of the undivided portion of the beneficial interest in the
Trust Fund represented by the Certificates. It is, further, not the intention of
the parties that such conveyance be deemed a pledge of the Trust Fund by the
Depositor to the Trustee to secure a debt or other obligation of the Depositor.
However, in the event that, notwithstanding the intent of the parties, the Trust
Fund is held to continue to be property of the Depositor then (a) this Agreement
shall also be deemed to be a security agreement under applicable law; (b) the
transfer of the Trust Fund provided for herein shall be deemed to be a grant by
the Depositor to the Trustee on behalf of Certificateholders of a first priority
security interest in all of the Depositor's right, title and interest in and to
the Trust Fund and all amounts payable to the holders of the Mortgage Loans in
accordance with the terms thereof and all proceeds of the conversion, voluntary
or involuntary, of the foregoing into cash, instruments, securities or other
property, including, without limitation, all amounts from time to time held or
invested in the Collection Account and the Distribution Account, whether in the
form of cash, instruments, securities or other property; (c) the possession by
the Trustee (or the Custodian on its behalf) of Notes and such other items of
property as constitute instruments, money, negotiable documents or chattel paper
shall be deemed to be "possession by the secured party" for purposes of
perfecting the security interest pursuant to Section 9-305 of the Missouri and
Illinois Uniform Commercial Codes; and (d) notifications to Persons holding such
property, and acknowledgments, receipts or confirmations from Persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Trustee for the purpose of perfecting such security interest under
applicable law. Any assignment of the interest of the Trustee pursuant to any
provision hereof shall also be deemed to be an assignment of any security
interest created hereby. The Depositor shall, and upon the request of the
Servicer, the Trustee shall, to the extent consistent with this Agreement (and
at the expense of the Trust Fund), take such actions as may be necessary to
ensure that, if this Agreement were deemed to create a security interest in the
Mortgage Loans, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of this Agreement. It is the intent of the parties
that such a security interest would be effective whether any of the Certificates
are sold, pledged or assigned.
163
<PAGE> 170
IN WITNESS WHEREOF, the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent have caused their names to be signed
hereto by their respective officers thereunto duly authorized as of the day and
year first above written.
Signed and acknowledged PRUDENTIAL SECURITIES SECURED
in the presence of: FINANCING CORPORATION
as Depositor
/s/ Andy Chao
- -------------------------------
Print Name: Andy Chao
/s/ Adrianne C. Dicker
- ------------------------------- By: /s/ Peter Riemenschneider
Print Name: Adrianne C. Dicker ----------------------------
Name: Peter Riemenschneider
Title: Vice President
Signed and acknowledged MIDLAND LOAN SERVICES, L.P.
in the presence of: as Servicer
/s/ Karen J. McNish
- ------------------------------- By: MIDLAND DATA SYSTEMS, INC.
Print Name: Karen J. McNish its General Partner
/s/ Kristin J. Etter
- ------------------------------- By: /s/ Leon E. Bergman
Print Name: Kristin J. Etter -----------------------------
Name: Leon E. Bergman
Title: Senior Vice President
Signed and acknowledged LENNAR PARTNERS, INC.
in the presence of: as Special Servicer
/s/ Kendall Sparkman
- ------------------------------- By: /s/ Jeffrey P. Kransnoff
Print Name: Kendall Sparkman ----------------------------
Name: Jeffrey P. Kransnoff
Title: Vice President
/s/ Brian L. Bilzin
- -------------------------------
Print Name: Brian L. Bilzin
Signed and acknowledged LASALLE NATIONAL BANK
in the presence of: as Trustee, Custodian, Certificate
Registrar and Paying Agent
/s/ Jennifer Lader
- -------------------------------
Print Name: Jennifer Lader By: /s/ Russell M. Goldenberg
-----------------------------
/s/ Amy Bulger Name: Russell M. Goldenberg
- ------------------------------- Title: Vice President
Print Name: Amy Bulger
<PAGE> 171
Signed and acknowledged ABN AMRO BANK N.V.
in the presence of: as Fiscal Agent of the Trustee
/s/ Mary L. Collier
- -------------------------------
Print Name: Mary L. Collier
/s/ Doug Hart By: /s/ Bernard J. McGuigan
- ------------------------------- ---------------------------
Print Name: Doug Hart Name: Bernard J. McGuigan
Title: Group Vice President
Signed and acknowledged ABN AMRO BANK N.V.
in the presence of: as Fiscal Agent of the Trustee
/s/ Mary L. Collier
- -------------------------------
Print Name: Mary L. Collier
/s/ Doug Hart By: /s/ Robert C. Smolka
- ------------------------------- ---------------------------
Print Name: Doug Hart Name: Robert C. Smolka
Title: Vice President
<PAGE> 172
STATE OF ILLINOIS )
) ss.:
COUNTY OF COOK )
On the 15th day of December, 1995, before me, Bettye McDowell, a
Notary Public in and for said State, personally appeared Bernard J. McGuigan,
Group Vice President and Robert C. Smolka, Vice President, personally
known to me or proved to me on the basis of satisfactory evidence to be the
persons whose names are subscribed to the within instrument and acknowledged to
me that they executed the same in their authorized capacity, and that by their
signatures on the instrument the corporation upon behalf of which the person
acted executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Bettye McDowell
___________________________
NOTARY PUBLIC in and for the
STATE OF ILLINOIS
My commission expires: 05-09-99
(stamp) -------------------------------
"OFFICIAL SEAL"
BETTYE McDOWELL
NOTARY PUBLIC STATE OF ILLINOIS
My Commission Expires 05/09/99
(seal) -------------------------------
<PAGE> 173
EXHIBIT A-1
THIS CLASS A-1 CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC") TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE
CODE.
<PAGE> 174
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS A-1
Pass-Through Rate: 6.525%
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class A-1 Certificates: November 25, 2015
$75,000,000
CUSIP: 74436JCT2 Initial Class Certificate Balance
of this Certificate: $75,000,000
No.: 1 Registered Owner: Cede & Co.
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to
be made with respect to the Class A-1 Certificates. The Trust Fund, described
more fully below, consists primarily of a pool of commercial Mortgage Loans
secured by first liens on commercial and multifamily properties and held in
trust by the Trustee and serviced by the Servicer. The Trust Fund was created,
and the Mortgage Loans are to be serviced, pursuant to the Pooling and
Servicing Agreement (as defined below). The Holder of this Certificate, by
virtue of the acceptance hereof, assents to the terms, provisions and
conditions of the Pooling and Servicing Agreement and is bound thereby. Also
issued under the Pooling and Servicing Agreement are the Class A-2, Class A-EC,
Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class
J-2, Class R and Class LR Certificates (together with the Class A-1
Certificates, the "Certificates"; the Holders of Certificates issued under
the Pooling and Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential
Securities Secured Financing Corporation, as depositor (the "Depositor"),
Midland Loan Services, L.P., as servicer (the "Servicer"), Lennar Partners,
Inc., as special servicer (the "Special Servicer"), LaSalle National Bank, as
trustee (the "Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the
Trustee (the "Fiscal Agent"). To the extent not defined herein, capitalized
terms used herein shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate
A-1-2
<PAGE> 175
in accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class A-1
Certificates for such Distribution Date, all as more fully described in the
Pooling and Servicing Agreement. Holders of this Certificate may be entitled
to Prepayment Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class A-1 Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the Class A-1
Pass-Through Rate on the outstanding Certificate Balance hereof. All
calculations of interest on the Class A-1 Certificates will be made on the
basis of a 360-day year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with respect to any Distribution
Date is the calendar month preceding the month in which such Distribution Date
occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of
A-1-3
<PAGE> 176
this Certificate at the location specified in the notice to Certificateholders
of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on any
amount held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer shall not be
invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar
A-1-4
<PAGE> 177
shall require that this Certificate be duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing. Thereupon, one or more new Certificates without coupons
of a like aggregate Percentage Interest of the same Class in authorized
denominations will be executed by the Trustee or the Authenticating Agent and
authenticated by the Authenticating Agent and delivered by the Certificate
Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
A-1-5
<PAGE> 178
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the
A-1-6
<PAGE> 179
three highest such quotes, equals or exceeds the
aggregate amount of the Certificate Balances of all
Certificates expected to be outstanding as of the
close of business on the Auction Proceeds
Distribution Date (such aggregate amount, the
"Aggregate Certificate Balance") as well as auction
expenses, the Trustee shall appoint an Auction Agent
to solicit offers from Qualified Offerors to purchase
all (but not less than all) of the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created
by the Pooling and Servicing Agreement continue beyond the expiration of 21
years from the death of the last surviving descendant(s) of Joseph P. Kennedy,
the late ambassador of the United States to the United Kingdom, living on the
date hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-1-7
<PAGE> 180
IN WITNESS WHEREOF, the Trustee has caused this Class A-1
Certificate to be duly executed.
Dated:____________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:____________________________________________
Authorized Officer
Certificate of Authentication
This is the Class A-1 Certificate referred to in the Pooling
and Servicing Agreement.
Dated: _________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:____________________________________________
Authorized Officer
A-1-8
<PAGE> 181
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s), assign(s)
and transfer(s) unto
_______________________________________________ (please print or typewrite
name(s) and address(es), including postal zip code(s) of assignee(s))
("Assignee(s)") the entire Percentage Interest represented by the within
Class A-1 Certificate and hereby authorize(s) the registration of transfer of
such interest to Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class A-1
Certificate of the entire Percentage Interest represented by the within Class
A-1 Certificates to the above-named Assignee(s) and to deliver such Class A-1
Certificate to the following address:
_______________________________________________________
_______________________________________________________
Date:______________ __________________________________________
Signature by or on behalf of
Assignor(s)
__________________________________________
Taxpayer Identification Number
A-1-9
<PAGE> 182
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:__________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
____________________ for the account of ________________________________ account
number ____________________________________.
This information is provided by __________________________________________ the
Assignee(s) named above, or ___________________ as its (their) agent.
By:_________________________________________
____________________________________________
[Please print or type name(s)]
____________________________________________
Title
____________________________________________
Taxpayer Identification Number
A-1-10
<PAGE> 183
EXHIBIT A-2
THIS CLASS A-2 CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A)(1) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL
INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN
ACCOUNT OR A PERSON PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC") TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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.
A-2-1
<PAGE> 184
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE
CODE.
A-2-2
<PAGE> 185
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS A-2
Pass-Through Rate: 6.84%
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class A-2 Certificates: November 25, 2015
$65,040,000
CUSIP: 74436JCU9 Initial Class Certificate
Balance of this Certificate: $65,040,000
No.: 1 Registered Owner: Cede & Co.
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to
be made with respect to the Class A-2 Certificates. The Trust Fund, described
more fully below, consists primarily of a pool of commercial Mortgage Loans
secured by first liens on commercial and multifamily properties and held in
trust by the Trustee and serviced by the Servicer. The Trust Fund was created,
and the Mortgage Loans are to be serviced, pursuant to the Pooling and
Servicing Agreement (as defined below). The Holder of this Certificate, by
virtue of the acceptance hereof, assents to the terms, provisions and
conditions of the Pooling and Servicing Agreement and is bound thereby. Also
issued under the Pooling and Servicing Agreement are the Class A-1, Class A-EC,
Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class
J-2, Class R and Class LR Certificates (together with the Class A-2
Certificates, the "Certificates"; the Holders of Certificates issued under
the Pooling and Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential
Securities Secured Financing Corporation, as depositor (the "Depositor"),
Midland Loan Services, L.P., as servicer (the "Servicer"), Lennar Partners,
Inc., as special servicer (the "Special Servicer"), LaSalle National Bank, as
trustee (the "Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the
Trustee (the "Fiscal Agent"). To the extent not defined herein, capitalized
terms used herein shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
A-2-3
<PAGE> 186
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class A-2
Certificates for such Distribution Date, all as more fully described in the
Pooling and Servicing Agreement. Holders of this Certificate may be entitled
to Prepayment Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class A-2 Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the Class A-2
Pass-Through Rate on the outstanding Certificate Balance hereof. All
calculations of interest on the Class A-2 Certificates will be made on the
basis of a 360-day year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with respect to any Distribution
Date is the calendar month preceding the month in which such Distribution Date
occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of
A-2-4
<PAGE> 187
Certificates the aggregate Certificate Balance or Notional Balance, as
applicable, of which is at least $5,000,000, or otherwise (b) by check mailed
to such Certificateholder. The final distribution on this Certificate shall be
made in like manner upon presentation and surrender of this Certificate at the
location specified in the notice to Certificateholders of such final
distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on any
amount held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer shall not be
invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
A-2-5
<PAGE> 188
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
A-2-6
<PAGE> 189
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
A-2-7
<PAGE> 190
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created
by the Pooling and Servicing Agreement continue beyond the expiration of 21
years from the death of the last surviving descendant(s) of Joseph P. Kennedy,
the late ambassador of the United States to the United Kingdom, living on the
date hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate
A-2-8
<PAGE> 191
shall not be entitled to any benefit under the Pooling and Servicing Agreement
or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-2-9
<PAGE> 192
IN WITNESS WHEREOF, the Trustee has caused this Class A-2
Certificate to be duly executed.
Dated:___________________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:___________________________________________
Authorized Officer
Certificate of Authentication
This is the Class A-2 Certificate referred to in the Pooling
and Servicing Agreement.
Dated:________________________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:___________________________________________
Authorized Officer
A-2-10
<PAGE> 193
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s), assign(s)
and transfer(s) unto
________________________________________________, (please print or typewrite
name(s) and address(es), including postal zip code(s) of assignee(s))
("Assignee(s)") the entire Percentage Interest represented by the within
Class A-2 Certificate and hereby authorize(s) the registration of transfer of
such interest to Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class A-2
Certificate of the entire Percentage Interest represented by the within Class
A-2 Certificates to the above-named Assignee(s) and to deliver such Class A-2
Certificate to the following address:
_______________________________________________
_______________________________________________
Date:______________ ______________________________________________
Signature by or on behalf of
Assignor(s)
______________________________________________
Taxpayer Identification Number
A-2-11
<PAGE> 194
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions: ________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
________________________________________________________________________________
____________________ for the account of ________________________________ account
number ____________________________________.
This information is provided by __________________________________________ the
Assignee(s) named above, or _____________________ as its (their) agent.
By:_________________________________________
____________________________________________
[Please print or type name(s)]
____________________________________________
Title
____________________________________________
Taxpayer Identification Number
A-2-12
<PAGE> 195
EXHIBIT A-3
THIS CLASS A-EC CERTIFICATE DOES NOT REPRESENT AN OBLIGATION
OF OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A)(1) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL
INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN
ACCOUNT OR A PERSON PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC") TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
A-3-1
<PAGE> 196
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE
CODE.
A-3-2
<PAGE> 197
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS A-EC
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Notional Scheduled Final Distribution Date:
Balance of the Class A-EC Certificates: November 25, 2015
$150,00,000
$72,286,173
CUSIP: 74436JCV7 Initial Class Notional Balance of
this Certificate: $222,286,173
No.: 1 Registered Owner: Cede & Co.
2
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to
be made with respect to the Class A-EC Certificates. The Trust Fund, described
more fully below, consists primarily of a pool of commercial Mortgage Loans
secured by first liens on commercial and multifamily properties and held in
trust by the Trustee and serviced by the Servicer. The Trust Fund was created,
and the Mortgage Loans are to be serviced, pursuant to the Pooling and
Servicing Agreement (as defined below). The Holder of this Certificate, by
virtue of the acceptance hereof, assents to the terms, provisions and
conditions of the Pooling and Servicing Agreement and is bound thereby. Also
issued under the Pooling and Servicing Agreement are the Class A-1, Class A-2,
Class B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class
J-2, Class R and Class LR Certificates (together with the Class A-EC
Certificates, the "Certificates"; the Holders of Certificates issued under
the Pooling and Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential
Securities Secured Financing Corporation, as depositor (the "Depositor"),
Midland Loan Services, L.P., as servicer (the "Servicer"), Lennar Partners,
Inc., as special servicer (the "Special Servicer"), LaSalle National Bank, as
trustee (the "Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the
Trustee (the "Fiscal Agent"). To the extent not defined herein, capitalized
terms used herein shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
A-3-3
<PAGE> 198
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class A-EC
Certificates for such Distribution Date, all as more fully described in the
Pooling and Servicing Agreement. Holders of this Certificate may be entitled
to Prepayment Premiums as provided in the Pooling and Servicing Agreement.
With respect to each Interest Accrual Period up to and
including December 26, 2006 (the "EC Maturity Date"), the Class A-EC
Certificates will be entitled to interest in an amount equal to the Class A-EC
Excess Interest. "Class A-EC Excess Interest" with respect to any
Distribution Date represents an amount equal to the Class A-EC Pass-Through
Rate multiplied by the Class A-EC Notional Balance. The "Class A-EC Notional
Balance," as of any date of determination, is an amount equal to the sum of
(i) the Class A-EC Notional Component A, (ii) the aggregate of the Certificate
Balances of the Class B Certificates through the Class J-1 Certificates and
(iii) the Notional Balance of the Class J-2 Certificates. The "Class A-EC
Notional Component A," as of any date of determination, is an amount equal to
the sum of the Certificate Balances of the Class A-1 Certificates and the Class
A-2 Certificates. The "Class A-EC Pass-Through Rate," with respect to any
Interest Accrual Period, is a per annum rate equal to the excess of the
Weighted Average Net Mortgage Rate over the weighted averages of the
Pass-Through Rates of the P&I Certificates (weighted on the basis of a fraction
equal to the Certificate Balance of each such Class of Certificates divided by
the sum of the Certificate Balances of the P&I Certificates and the Class J-2
Notional Balance as of the first day of such Interest Accrual Period) and the
Class J-2 Pass-Through Rate (weighted in each case on the basis of a fraction
equal to the Class J-2 Notional Balance divided by the sum of the Certificate
Balances of the P&I Certificates and the Class J-2 Notional Balance, each as of
the first day of such Interest Accrual Period).
A-3-4
<PAGE> 199
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with respect to any Distribution
Date is the calendar month preceding the month in which such Distribution Date
occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of this Certificate at the location specified in the
notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on any
amount held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer shall not be
invested.
A-3-5
<PAGE> 200
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
A-3-6
<PAGE> 201
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
A-3-7
<PAGE> 202
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in
A-3-8
<PAGE> 203
respect thereof by the Servicer, the Special Servicer, the Depositor or the
Holders of the Class LR Certificates as described above; (ii) the later of (a)
the distribution to Certificateholders of final payment with respect to the
Mortgage Loans or (b) the disposition of all property acquired upon foreclosure
or deed in lieu of foreclosure with respect to the Mortgage Loans and the
remittance to the Certificateholders of all funds due under the Pooling and
Servicing Agreement; or (iii) the sale of assets of the Trust Fund after the
Certificate Balances or Notional Balances, as applicable, of all the
Certificates (other than the Class R and Class LR Certificates) have been
reduced to zero under circumstances set forth in the Pooling and Servicing
Agreement. In no event, however, will the trust created by the Pooling and
Servicing Agreement continue beyond the expiration of 21 years from the death
of the last surviving descendant(s) of Joseph P. Kennedy, the late ambassador
of the United States to the United Kingdom, living on the date hereof.
This Certificate is issued on December 22, 1995, at an issue
price of ____% of the initial Class A-EC Notional Balance, including accrued
interest, and a stated redemption price at maturity equal to all interest
distributions hereon, and is issued with original issue discount ("OID") for
federal income tax purposes. Assuming (a) that this Certificate pays in
accordance with projected cash flows reflecting the prepayment assumption
described in Scenario 2 (as defined in the Private Placement Memorandum dated
December 22, 1995 with respect to the offering of the Certificates) used to
price this Certificate and (b) that the interest rate at which distributions of
interest on this Certificate actually will be made will be determined as though
the pass-through rates on this Certificate applicable to the first Distribution
Date will change only to reflect the maturity of the Mortgage Loans: (i) the
amount of OID as a percentage of the initial Class A-EC Notional Balance is
approximately ______%; (ii) the annual yield to maturity of this Certificate,
compounded monthly, is approximately _____%; and (iii) the amount of OID
allocable to the first accrual period (December 22, 1995 to January 25, 1996)
as a percentage of the initial Class A-EC Notional Balance, calculated using
the exact method, is approximately _________%.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-3-9
<PAGE> 204
IN WITNESS WHEREOF, the Trustee has caused this Class A-EC
Certificate to be duly executed.
Dated:___________________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:___________________________________________
Authorized Officer
Certificate of Authentication
This is the Class A-EC Certificate referred to in the Pooling
and Servicing Agreement.
Dated:______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:___________________________________________
Authorized Officer
A-3-10
<PAGE> 205
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s), assign(s)
and transfer(s) unto ___________________________________________________________
________________________________________________________________________________
______________ (please print or typewrite name(s) and address(es), including
postal zip code(s) of assignee(s)) ("Assignee(s)") the entire Percentage
Interest represented by the within Class A-EC Certificate and hereby
authorize(s) the registration of transfer of such interest to Assignee(s) on
the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class A-EC
Certificate of the entire Percentage Interest represented by the within Class
A-EC Certificates to the above-named Assignee(s) and to deliver such Class A-EC
Certificate to the following address:
________________________________________________________________________
________________________________________________________________________
Date:______________ __________________________________________
Signature by or on behalf of
Assignor(s)
__________________________________________
Taxpayer Identification Number
A-3-11
<PAGE> 206
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions: ________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
____________________ for the account of ________________________________ account
number ____________________________________.
This information is provided by ____________________________________________ the
Assignee(s) named above, or _______________________ as its (their) agent.
By:_________________________________________
____________________________________________
[Please print or type name(s)]
____________________________________________
Title
____________________________________________
Taxpayer Identification Number
A-3-12
<PAGE> 207
EXHIBIT A-4
THIS CLASS B CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A)(1) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL
INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN
ACCOUNT OR A PERSON PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC") TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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.
A-4-1
<PAGE> 208
THIS CLASS B CERTIFICATE IS SUBORDINATE TO THE CLASS A-1,
CLASS A-2 AND CLASS A-EC CERTIFICATES AS AND TO THE EXTENT SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED
BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE,
OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS TO A
MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (A
"SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE COMPANY THAT IS USING
ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR GENERAL ACCOUNT IN WHICH THE
ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE DEEMED PURSUANT TO ERISA OR ANY
SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS) OTHER THAN AN INSURANCE COMPANY
USING ASSETS OF ITS GENERAL ACCOUNT IN CIRCUMSTANCES WHEREBY SUCH PURCHASE OR
TRANSFER AND THE SUBSEQUENT HOLDING WOULD NOT CONSTITUTE OR RESULT IN A
PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA,
SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, OR (C) ANY OTHER PERSON ACTING ON
BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN. EACH PROSPECTIVE
TRANSFEREE OF THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE
CERTIFICATE REGISTRAR AND THE TRUSTEE, (I) A TRANSFEREE REPRESENTATION LETTER,
SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, STATING THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON
REFERRED TO IN CLAUSE (A), (B) OR (C) ABOVE, OR (II) AN OPINION OF COUNSEL WHICH
ESTABLISHES TO THE SATISFACTION OF THE DEPOSITOR, THE TRUSTEE AND THE
CERTIFICATE REGISTRAR THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT
RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND
SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF
ERISA, THE CODE OR ANY SIMILAR LAW, AND WILL NOT CONSTITUTE OR RESULT IN A
PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA,
SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, AND WILL NOT SUBJECT THE SERVICER,
THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE CERTIFICATE REGISTRAR TO
ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR
SECTION 4975 OF THE CODE), WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF
THE TRUSTEE, THE TRUST FUND, THE SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE
REGISTRAR OR THE DEPOSITOR.
A-4-2
<PAGE> 209
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE
CODE.
A-4-3
<PAGE> 210
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS B
Pass-Through Rate: 6.905%
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class B Certificates: November 25, 2015
$8,891,000
CUSIP: 74436JCW5 Initial Class Certificate Balance of
this Certificate: $8,891,000
No.: 1 Registered Owner: Cede & Co.
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to
be made with respect to the Class B Certificates. The Trust Fund, described
more fully below, consists primarily of a pool of commercial Mortgage Loans
secured by first liens on commercial and multifamily properties and held in
trust by the Trustee and serviced by the Servicer. The Trust Fund was created,
and the Mortgage Loans are to be serviced, pursuant to the Pooling and
Servicing Agreement (as defined below). The Holder of this Certificate, by
virtue of the acceptance hereof, assents to the terms, provisions and
conditions of the Pooling and Servicing Agreement and is bound thereby. Also
issued under the Pooling and Servicing Agreement are the Class A-1, Class A-2,
Class A-EC, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1,
Class J-2, Class R and Class LR Certificates (together with the Class B
Certificates, the "Certificates"; the Holders of Certificates issued under
the Pooling and Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential Securities
Secured Financing Corporation, as depositor (the "Depositor"), Midland Loan
Services, L.P., as servicer (the "Servicer"), Lennar Partners, Inc., as special
servicer (the "Special Servicer"), LaSalle National Bank, as trustee (the
"Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the Trustee (the "Fiscal
Agent").
A-4-4
<PAGE> 211
To the extent not defined herein, capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to such
Person's pro rata share (based on the Percentage Interest represented by this
Certificate after taking into account transfers and exchanges occurring prior to
the related Record Date) of that portion of the aggregate amount of principal
and interest then distributable, if any, allocable to the Class B Certificates
for such Distribution Date, all as more fully described in the Pooling and
Servicing Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class B Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the Class B
Pass-Through Rate on the outstanding Certificate Balance hereof. All
calculations of interest on the Class B Certificates will be made on the basis
of a 360-day year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with respect to any Distribution
Date is the calendar month preceding the month in which such Distribution Date
occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the
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<PAGE> 212
Certificateholder at a bank or other entity located in the United States having
appropriate facilities therefor, if such Certificateholder provides the Trustee
with wiring instructions no less than five Business Days prior to the related
Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of this Certificate at the location specified in the
notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on any
amount held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer shall not be
invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests,
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<PAGE> 213
rights, benefits, obligations and duties evidenced hereby, and the limitations
thereon, and the rights, duties and immunities of the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
A-4-7
<PAGE> 214
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
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<PAGE> 215
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as well
as auction expenses, the Trustee shall appoint an
Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by the
Trustee are Deficient Auction Bids, the Mortgage Loans
shall not be sold and there shall be no termination of
the Trust Fund pursuant to Section 9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created
by the Pooling and Servicing Agreement continue beyond the expiration of 21
years from the death of the last surviving descendant(s) of Joseph P.
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<PAGE> 216
Kennedy, the late ambassador of the United States to the United Kingdom, living
on the date hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
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<PAGE> 217
IN WITNESS WHEREOF, the Trustee has caused this Class B
Certificate to be duly executed.
Dated:__________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:___________________________________________
Authorized Officer
Certificate of Authentication
This is the Class B Certificate referred to in the Pooling and
Servicing Agreement.
Dated:__________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:__________________________________________
Authorized Officer
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<PAGE> 218
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s), assign(s)
and transfer(s) unto ___________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
_______________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class B Certificate and
hereby authorize(s) the registration of transfer of such interest to Assignee(s)
on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class B
Certificate of the entire Percentage Interest represented by the within Class B
Certificates to the above-named Assignee(s) and to deliver such Class B
Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Date:_______
______________________________________________
Signature by or on behalf of
Assignor(s)
______________________________________________
Taxpayer Identification Number
A-4-12
<PAGE> 219
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution: Address of the Assignee(s) for the purpose of receiving notices
and distributions: ____________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
____________________________________________________________________________ for
the account of ________________________________________________________________
_____ account number____________________________________.
This information is provided by ________________________________ the
Assignee(s) named above, or ______________________ as its (their) agent.
By:___________________________________________
______________________________________________
[Please print or type name(s)]
______________________________________________
Title
______________________________________________
Taxpayer Identification Number
A-4-13
<PAGE> 220
EXHIBIT A-5
THIS CLASS C CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC") TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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 CLASS C CERTIFICATE IS SUBORDINATE TO THE CLASS A-1,
CLASS A-2, CLASS A-EC AND CLASS B CERTIFICATES AS AND TO THE EXTENT SET FORTH
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED
BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF
THE CODE, OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH
IS TO A MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE
(A "SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE COMPANY THAT IS USING
ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR GENERAL ACCOUNT IN WHICH THE
ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE DEEMED PURSUANT TO ERISA OR ANY
SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS) OTHER THAN AN INSURANCE COMPANY
USING ASSETS OF ITS GENERAL ACCOUNT IN
A-5-1
<PAGE> 221
CIRCUMSTANCES WHEREBY SUCH PURCHASE OR TRANSFER AND THE SUBSEQUENT HOLDING
WOULD NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING
OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW,
OR (C) ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS
OF ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE
REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE
TRUSTEE, (I) A TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF
EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING
THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B)
OR (C) ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE
SATISFACTION OF THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT
THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF
THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, THE CODE OR ANY
SIMILAR LAW, AND WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION
WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR
ANY SIMILAR LAW, AND WILL NOT SUBJECT THE SERVICER, THE SPECIAL SERVICER, THE
DEPOSITOR, THE TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR
LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF
THE CODE), WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE
TRUST FUND, THE SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR
THE DEPOSITOR.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE CODE.
A-5-2
<PAGE> 222
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS C
Pass-Through Rate: 7.015%
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class C Certificates: November 25, 2015
$13,337,000
CUSIP: 74436JCX3 Initial Class Certificate Balance of
this Certificate: $13,337,000
No.: 1 Registered Owner: Cede & Co.
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to
be made with respect to the Class C Certificates. The Trust Fund, described
more fully below, consists primarily of a pool of commercial Mortgage Loans
secured by first liens on commercial and multifamily properties and held in
trust by the Trustee and serviced by the Servicer. The Trust Fund was created,
and the Mortgage Loans are to be serviced, pursuant to the Pooling and
Servicing Agreement (as defined below). The Holder of this Certificate, by
virtue of the acceptance hereof, assents to the terms, provisions and
conditions of the Pooling and Servicing Agreement and is bound thereby. Also
issued under the Pooling and Servicing Agreement are the Class A-1, Class A-2,
Class A-EC, Class B, Class D, Class E, Class F, Class G, Class H, Class J-1,
Class J-2, Class R and Class LR Certificates (together with the Class C
Certificates, the "Certificates"; the Holders of Certificates issued under the
Pooling and Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential Securities
Secured Financing Corporation, as depositor (the "Depositor"), Midland Loan
Services, L.P., as servicer (the "Servicer"), Lennar Partners, Inc., as special
servicer (the "Special Servicer"), LaSalle National Bank, as trustee (the
"Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the Trustee (the "Fiscal
Agent"). To the extent not defined herein, capitalized terms used herein shall
have the meanings assigned thereto in the Pooling and Servicing Agreement.
A-5-3
<PAGE> 223
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class C
Certificates for such Distribution Date, all as more fully described in the
Pooling and Servicing Agreement. Holders of this Certificate may be entitled
to Prepayment Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class C Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the Class C
Pass-Through Rate on the outstanding Certificate Balance hereof. All
calculations of interest on the Class C Certificates will be made on the basis
of a 360-day year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with respect to any Distribution Date
is the calendar month preceding the month in which such Distribution Date
occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of
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<PAGE> 224
Certificates the aggregate Certificate Balance or Notional Balance, as
applicable, of which is at least $5,000,000, or otherwise (b) by check mailed
to such Certificateholder. The final distribution on this Certificate shall be
made in like manner upon presentation and surrender of this Certificate at the
location specified in the notice to Certificateholders of such final
distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on
any amount held as a result of such Certificateholder's failure to surrender
its Certificate(s) for final payment thereof in accordance with Section 9.1 of
the Pooling and Servicing Agreement. Such funds held by the Servicer shall not
be invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
A-5-5
<PAGE> 225
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
A-5-6
<PAGE> 226
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
A-5-7
<PAGE> 227
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four Independent
broker-dealer firms for bids for whole loans, and if
the aggregate fair market value of the Mortgage Loans
and all other property acquired in respect of any
Mortgage Loan in the Trust Fund, as determined by the
average of the three highest such quotes, equals or
exceeds the aggregate amount of the Certificate
Balances of all Certificates expected to be
outstanding as of the close of business on the Auction
Proceeds Distribution Date (such aggregate amount, the
"Aggregate Certificate Balance") as well as auction
expenses, the Trustee shall appoint an Auction Agent
to solicit offers from Qualified Offerors to purchase
all (but not less than all) of the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by the
Trustee are Deficient Auction Bids, the Mortgage Loans
shall not be sold and there shall be no termination of
the Trust Fund pursuant to Section 9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created
by the Pooling and Servicing Agreement continue beyond the expiration of 21
years from the death of the last surviving descendant(s) of Joseph P. Kennedy,
the late ambassador of the United States to the United Kingdom, living on the
date hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate
A-5-8
<PAGE> 228
shall not be entitled to any benefit under the Pooling and Servicing Agreement
or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-5-9
<PAGE> 229
IN WITNESS WHEREOF, the Trustee has caused this Class C
Certificate to be duly executed.
Dated:_______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:___________________________________________
Authorized Officer
Certificate of Authentication
This is the Class C Certificate referred to in the Pooling and
Servicing Agreement.
Dated:_______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:__________________________________________
Authorized Officer
A-5-10
<PAGE> 230
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby sell(s), assign(s)
and transfer(s) unto
_______________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class C Certificate and
hereby authorize(s) the registration of transfer of such interest to Assignee(s)
on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class C
Certificate of the entire Percentage Interest represented by the within Class C
Certificates to the above-named Assignee(s) and to deliver such Class C
Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Date:____________
______________________________________________
Signature by or on behalf of
Assignor(s)
______________________________________________
Taxpayer Identification Number
A-5-11
<PAGE> 231
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution: Address of the Assignee(s) for the purpose of receiving notices
and distributions: ____________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
_____________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
____________________________________________________________________________ for
the account of ________________________________________________________________
_____ account number____________________________________.
This information is provided by ________________________________ the
Assignee(s) named above, or ______________________ as its (their) agent.
By:___________________________________________
______________________________________________
[Please print or type name(s)]
______________________________________________
Title
______________________________________________
Taxpayer Identification Number
A-5-12
<PAGE> 232
EXHIBIT A-6
THIS CLASS D CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE
BALANCE SET FORTH BELOW.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC") TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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 CLASS D CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS
A-2, CLASS A-EC, CLASS B AND CLASS C CERTIFICATES AS AND TO THE EXTENT SET FORTH
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED BY
A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE,
OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS TO A
MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (A
"SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE COMPANY THAT IS USING
ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR GENERAL ACCOUNT IN WHICH THE
ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE DEEMED PURSUANT TO ERISA OR ANY
SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS) OTHER THAN AN INSURANCE COMPANY
USING ASSETS OF ITS GENERAL ACCOUNT IN
A-6-1
<PAGE> 233
CIRCUMSTANCES WHEREBY SUCH PURCHASE OR TRANSFER AND THE SUBSEQUENT HOLDING WOULD
NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF
SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, OR
(C) ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF
ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE REQUIRED
TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE, (I) A
TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING THAT SUCH
PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B) OR (C)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT THE PURCHASE OR
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR
PROHIBITED TRANSACTION PROVISIONS OF ERISA, THE CODE OR ANY SIMILAR LAW, AND
WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF
SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, AND
WILL NOT SUBJECT THE SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE
OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE), WHICH
OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE
SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT IF
THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE WITH
FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE CODE.
A-6-2
<PAGE> 234
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS D
Pass-Through Rate: 7.165%
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class D Certificates: November 25, 2015
$8,892,000
CUSIP: 74436JCY1 Initial Class Certificate Balance of this
Certificate: $8,892,000
No.: 1 Registered Owner: Cede & Co.
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to be
made with respect to the Class D Certificates. The Trust Fund, described more
fully below, consists primarily of a pool of commercial Mortgage Loans secured
by first liens on commercial and multifamily properties and held in trust by the
Trustee and serviced by the Servicer. The Trust Fund was created, and the
Mortgage Loans are to be serviced, pursuant to the Pooling and Servicing
Agreement (as defined below). The Holder of this Certificate, by virtue of the
acceptance hereof, assents to the terms, provisions and conditions of the
Pooling and Servicing Agreement and is bound thereby. Also issued under the
Pooling and Servicing Agreement are the Class A-1, Class A-2, Class A-EC, Class
B, Class C, Class E, Class F, Class G, Class H, Class J-1, Class J-2, Class R
and Class LR Certificates (together with the Class D Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling and
Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance with,
the terms of a Pooling and Servicing Agreement, dated as of December 1, 1995
(the "Pooling and Servicing Agreement"), by and among Prudential Securities
Secured Financing Corporation, as depositor (the "Depositor"), Midland Loan
Services, L.P., as servicer (the "Servicer"), Lennar Partners, Inc., as special
servicer (the "Special Servicer"), LaSalle National Bank, as trustee (the
"Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the Trustee (the "Fiscal
Agent"). To the extent not defined herein, capitalized terms used herein shall
have the meanings assigned thereto in the Pooling and Servicing Agreement.
A-6-3
<PAGE> 235
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to such
Person's pro rata share (based on the Percentage Interest represented by this
Certificate after taking into account transfers and exchanges occurring prior to
the related Record Date) of that portion of the aggregate amount of principal
and interest then distributable, if any, allocable to the Class D Certificates
for such Distribution Date, all as more fully described in the Pooling and
Servicing Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class D Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the Class D
Pass-Through Rate on the outstanding Certificate Balance hereof. All
calculations of interest on the Class D Certificates will be made on the basis
of a 360-day year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest Accrual
Period, net of this Certificate's pro rata share of any Uncovered Prepayment
Interest Shortfalls for the Distribution Date following such Interest Accrual
Period, plus the aggregate unpaid Class Interest Shortfall with respect to this
Certificate, if any, will be payable on the related Distribution Date to the
extent provided in the Pooling and Servicing Agreement. The "Interest Accrual
Period" with respect to any Distribution Date is the calendar month preceding
the month in which such Distribution Date occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made (a)
by wire transfer in immediately available funds to the account specified by the
Certificateholder at a bank or other entity located in the United States having
appropriate facilities therefor, if such Certificateholder provides the Trustee
with wiring instructions no less than five Business Days prior to the related
Record Date and is the registered owner of
A-6-4
<PAGE> 236
Certificates the aggregate Certificate Balance or Notional Balance, as
applicable, of which is at least $5,000,000, or otherwise (b) by check mailed to
such Certificateholder. The final distribution on this Certificate shall be made
in like manner upon presentation and surrender of this Certificate at the
location specified in the notice to Certificateholders of such final
distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.1 of the Pooling
and Servicing Agreement shall not have been surrendered for cancellation within
six months after the time specified in such notice, the Servicer shall mail a
second notice to the remaining Certificateholders, at their last addresses shown
in the Certificate Register, to surrender their Certificates for cancellation in
order to receive, from such funds held, the final distribution with respect
thereto. If within one year after the second notice any Certificate shall not
have been surrendered for cancellation, the Servicer may, directly or through an
agent, take appropriate steps to contact the remaining Certificateholders
concerning surrender of their Certificates. The costs and expenses of
maintaining such funds and of contacting Certificateholders shall be paid out of
the assets which remain held. If within two years after the second notice any
Certificates shall not have been surrendered for cancellation, the Paying Agent
shall pay to the Servicer all amounts distributable to the Holders thereof, at
which time the obligations of the Trustee to such Holders with respect to such
amounts shall terminate, and the Servicer shall thereafter hold such amounts for
the benefit of such Holders. No interest shall accrue or be payable to any
Certificateholder on any amount held as a result of such Certificateholder's
failure to surrender its Certificate(s) for final payment thereof in accordance
with Section 9.1 of the Pooling and Servicing Agreement. Such funds held by the
Servicer shall not be invested.
This Certificate is limited in right of payment to, among other
things, certain collections and recoveries in respect of the Mortgage Loans, as
more specifically set forth herein and in the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be invested
in Permitted Investments. Interest or other income earned on funds in the
Collection Account and the Distribution Account will be paid to the Servicer or
the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
A-6-5
<PAGE> 237
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this Certificate
for registration of transfer at the corporate trust office of the Certificate
Registrar or at the office of any transfer agent. The Certificate Registrar
shall require that this Certificate be duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Certificate Registrar
duly executed by, the Holder hereof or such Holder's attorney duly authorized in
writing. Thereupon, one or more new Certificates without coupons of a like
aggregate Percentage Interest of the same Class in authorized denominations will
be executed by the Trustee or the Authenticating Agent and authenticated by the
Authenticating Agent and delivered by the Certificate Registrar to the
designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each transferor
of a sum sufficient to cover any tax, expense or other governmental charge
payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions therein that may be inconsistent with any other provisions therein,
(iii) to amend any provision thereof to the extent necessary or desirable to
maintain the rating or ratings assigned to each of the Classes of Regular
Certificates by each Rating Agency, or (iv) to make any other provisions with
respect to matters or questions arising under the Pooling and Servicing
Agreement, which shall not be inconsistent with the provisions of the Pooling
and Servicing Agreement and will not result in the downgrading, withdrawal or
qualification of the rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing and, which, as
evidenced by an Opinion of Counsel at the expense of the party (other than the
Trustee, unless such amendment modifies or otherwise relates solely to the
obligations, duties or rights of the Trustee) requesting such amendment, shall
not adversely affect in any material respect the interests of any
Certificateholder.
A-6-6
<PAGE> 238
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of the Pooling and Servicing Agreement or of modifying in any
manner the rights of the Certificateholders; provided, however, that no such
amendment shall: (i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of each affected Certificateholder; (ii) change
the percentages of Voting Rights of Holders of Certificates which are required
to consent to any action or inaction under the Pooling and Servicing Agreement,
without the consent of the Holders of all Certificates then outstanding; or (ii)
alter the servicing standard set forth in the Pooling and Servicing Agreement or
the obligations of the Servicer, the Trustee or the Fiscal Agent to make a P&I
Advance or Property Advance without the consent of the Holders of all
Certificates representing all of the Voting Rights of the Class or Classes
affected thereby.
Further, the Depositor, the Servicer, the Special Servicer, the
Trustee and the Fiscal Agent, at any time and from time to time, without the
consent of the Certificateholders, may amend the Pooling and Servicing Agreement
to modify, eliminate or add to any of its provisions to such extent as shall be
necessary to maintain the qualification of the Trust REMICs as two separate
REMICs, or to prevent the imposition of any additional material state or local
taxes, at all times that any Certificates are outstanding; provided, however,
that such action, as evidenced by an opinion of counsel, is necessary or helpful
to maintain such qualification or to prevent the imposition of any such taxes,
and would not adversely affect in any material respect the interest of any
Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
A-6-7
<PAGE> 239
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee) the
Trustee shall solicit quotes from four Independent
broker-dealer firms for bids for whole loans, and if
the aggregate fair market value of the Mortgage Loans
and all other property acquired in respect of any
Mortgage Loan in the Trust Fund, as determined by the
average of the three highest such quotes, equals or
exceeds the aggregate amount of the Certificate
Balances of all Certificates expected to be
outstanding as of the close of business on the Auction
Proceeds Distribution Date (such aggregate amount, the
"Aggregate Certificate Balance") as well as auction
expenses, the Trustee shall appoint an Auction Agent
to solicit offers from Qualified Offerors to purchase
all (but not less than all) of the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase price
that is less than the Aggregate Certificate Balance,
(c) that provides for purchase on terms other than
all-cash or (d) that is contingent on the occurrence
or non-occurrence of any event (each, a "Deficient
Auction Bid"). If all bids received by the Trustee are
Deficient Auction Bids, the Mortgage Loans shall not
be sold and there shall be no termination of the Trust
Fund pursuant to Section 9.1(d).
(iii) The Trustee is required to accept the highest bid that
is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as described
above; (ii) the later of (a) the distribution to Certificateholders of final
payment with respect to the Mortgage Loans or (b) the disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure with respect
to the Mortgage Loans and the remittance to the Certificateholders of all funds
due under the Pooling and Servicing Agreement; or (iii) the sale of assets of
the Trust Fund after the Certificate Balances or Notional Balances, as
applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created by
the Pooling and Servicing Agreement continue beyond the expiration of 21 years
from the death of the last surviving descendant(s) of Joseph P. Kennedy, the
late ambassador of the United States to the United Kingdom, living on the date
hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate
A-6-8
<PAGE> 240
shall not be entitled to any benefit under the Pooling and Servicing Agreement
or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-6-9
<PAGE> 241
IN WITNESS WHEREOF, the Trustee has caused this Class D
Certificate to be duly executed.
Dated:_____________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:______________________________
Authorized Officer
Certificate of Authentication
This is the Class D Certificate referred to in the Pooling and
Servicing Agreement.
Dated:_____________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:______________________________
Authorized Officer
A-6-10
<PAGE> 242
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto
_______________ (please print or typewrite name(s) and address(es), including
postal zip code(s) of assignee(s)) ("Assignee(s)") the entire Percentage
Interest represented by the within Class D Certificate and hereby authorize(s)
the registration of transfer of such interest to Assignee(s) on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class D
Certificate of the entire Percentage Interest represented by the within Class D
Certificates to the above-named Assignee(s) and to deliver such Class D
Certificate to the following address:
________________________________
________________________________
Date:
_________________ _______________________________
Signature by or on behalf of
Assignor(s)
________________________________
Taxpayer Identification Number
A-6-11
<PAGE> 243
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:__________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
for the account of _____________________________________________________________
_____________________________________________________________account number
_____________________________________________________________.
This information is provided by___________________the Assignee(s) named above,
or ______________________ as its (their) agent.
By:______________________________
_________________________________
[Please print or type name(s)]
_________________________________
Title
_________________________________
Taxpayer Identification Number
A-6-12
<PAGE> 244
EXHIBIT A-7
THIS CLASS E CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL CERTIFICATE
BALANCE SET FORTH BELOW.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC") TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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 CLASS E CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS
A-2, CLASS A-EC, CLASS B, CLASS C AND CLASS D CERTIFICATES AS AND TO THE EXTENT
SET FORTH IN THE POOLING AND SERVICING AGREEMENT.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED BY
A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE,
OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS TO A
MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (A
"SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE COMPANY THAT IS USING
ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR GENERAL ACCOUNT IN WHICH THE
ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE DEEMED PURSUANT TO ERISA OR ANY
SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS) OTHER THAN AN INSURANCE COMPANY
USING ASSETS OF ITS GENERAL ACCOUNT IN
A-7-1
<PAGE> 245
CIRCUMSTANCES WHEREBY SUCH PURCHASE OR TRANSFER AND THE SUBSEQUENT HOLDING WOULD
NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF
SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, OR
(C) ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF
ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE REQUIRED
TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE, (I) A
TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING THAT SUCH
PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B) OR (C)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT THE PURCHASE OR
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR
PROHIBITED TRANSACTION PROVISIONS OF ERISA, THE CODE OR ANY SIMILAR LAW, AND
WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF
SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, AND
WILL NOT SUBJECT THE SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE
OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE), WHICH
OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE
SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT IF
THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE WITH
FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE CODE.
A-7-2
<PAGE> 246
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS E
Initial Pass-Through Rate: 7.557%
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class E Certificates: November 25, 2015
$15,560,000
CUSIP: 74436JCZ8 Initial Class Certificate Balance
of this Certificate: $15,560,000
No.: 1 Registered Owner: Cede & Co.
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to be
made with respect to the Class E Certificates. The Trust Fund, described more
fully below, consists primarily of a pool of commercial Mortgage Loans secured
by first liens on commercial and multifamily properties and held in trust by the
Trustee and serviced by the Servicer. The Trust Fund was created, and the
Mortgage Loans are to be serviced, pursuant to the Pooling and Servicing
Agreement (as defined below). The Holder of this Certificate, by virtue of the
acceptance hereof, assents to the terms, provisions and conditions of the
Pooling and Servicing Agreement and is bound thereby. Also issued under the
Pooling and Servicing Agreement are the Class A-1, Class A-2, Class A-EC, Class
B, Class C, Class D, Class F, Class G, Class H, Class J-1, Class J-2, Class R
and Class LR Certificates (together with the Class E Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling and
Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance with,
the terms of a Pooling and Servicing Agreement, dated as of December 1, 1995
(the "Pooling and Servicing Agreement"), by and among Prudential Securities
Secured Financing Corporation, as depositor (the "Depositor"), Midland Loan
Services, L.P., as servicer (the "Servicer"), Lennar Partners, Inc., as special
servicer (the "Special Servicer"), LaSalle National Bank, as trustee (the
"Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the Trustee (the "Fiscal
Agent"). To the extent not defined herein, capitalized terms used herein shall
have the meanings assigned thereto in the Pooling and Servicing Agreement.
A-7-3
<PAGE> 247
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to such
Person's pro rata share (based on the Percentage Interest represented by this
Certificate after taking into account transfers and exchanges occurring prior to
the related Record Date) of that portion of the aggregate amount of principal
and interest then distributable, if any, allocable to the Class E Certificates
for such Distribution Date, all as more fully described in the Pooling and
Servicing Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class E Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the Class E
Pass-Through Rate on the outstanding Certificate Balance hereof. All
calculations of interest on the Class E Certificates will be made on the basis
of a 360-day year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest Accrual
Period, net of this Certificate's pro rata share of any Uncovered Prepayment
Interest Shortfalls for the Distribution Date following such Interest Accrual
Period, plus the aggregate unpaid Class Interest Shortfall with respect to this
Certificate, if any, will be payable on the related Distribution Date to the
extent provided in the Pooling and Servicing Agreement. The "Interest Accrual
Period" with respect to any Distribution Date is the calendar month preceding
the month in which such Distribution Date occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made (a)
by wire transfer in immediately available funds to the account specified by the
Certificateholder at a bank or other entity located in the United States having
appropriate facilities therefor, if such Certificateholder provides the Trustee
with wiring instructions no less than five Business Days prior to the related
Record Date and is the registered owner of
A-7-4
<PAGE> 248
Certificates the aggregate Certificate Balance or Notional Balance, as
applicable, of which is at least $5,000,000, or otherwise (b) by check mailed to
such Certificateholder. The final distribution on this Certificate shall be made
in like manner upon presentation and surrender of this Certificate at the
location specified in the notice to Certificateholders of such final
distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.1 of the Pooling
and Servicing Agreement shall not have been surrendered for cancellation within
six months after the time specified in such notice, the Servicer shall mail a
second notice to the remaining Certificateholders, at their last addresses shown
in the Certificate Register, to surrender their Certificates for cancellation in
order to receive, from such funds held, the final distribution with respect
thereto. If within one year after the second notice any Certificate shall not
have been surrendered for cancellation, the Servicer may, directly or through an
agent, take appropriate steps to contact the remaining Certificateholders
concerning surrender of their Certificates. The costs and expenses of
maintaining such funds and of contacting Certificateholders shall be paid out of
the assets which remain held. If within two years after the second notice any
Certificates shall not have been surrendered for cancellation, the Paying Agent
shall pay to the Servicer all amounts distributable to the Holders thereof, at
which time the obligations of the Trustee to such Holders with respect to such
amounts shall terminate, and the Servicer shall thereafter hold such amounts for
the benefit of such Holders. No interest shall accrue or be payable to any
Certificateholder on any amount held as a result of such Certificateholder's
failure to surrender its Certificate(s) for final payment thereof in accordance
with Section 9.1 of the Pooling and Servicing Agreement. Such funds held by the
Servicer shall not be invested.
This Certificate is limited in right of payment to, among other
things, certain collections and recoveries in respect of the Mortgage Loans, as
more specifically set forth herein and in the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be invested
in Permitted Investments. Interest or other income earned on funds in the
Collection Account and the Distribution Account will be paid to the Servicer or
the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
A-7-5
<PAGE> 249
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this Certificate
for registration of transfer at the corporate trust office of the Certificate
Registrar or at the office of any transfer agent. The Certificate Registrar
shall require that this Certificate be duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Certificate Registrar
duly executed by, the Holder hereof or such Holder's attorney duly authorized in
writing. Thereupon, one or more new Certificates without coupons of a like
aggregate Percentage Interest of the same Class in authorized denominations will
be executed by the Trustee or the Authenticating Agent and authenticated by the
Authenticating Agent and delivered by the Certificate Registrar to the
designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each transferor
of a sum sufficient to cover any tax, expense or other governmental charge
payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions therein that may be inconsistent with any other provisions therein,
(iii) to amend any provision thereof to the extent necessary or desirable to
maintain the rating or ratings assigned to each of the Classes of Regular
Certificates by each Rating Agency, or (iv) to make any other provisions with
respect to matters or questions arising under the Pooling and Servicing
Agreement, which shall not be inconsistent with the provisions of the Pooling
and Servicing Agreement and will not result in the downgrading, withdrawal or
qualification of the rating or ratings then assigned to any outstanding Class of
Certificates, as confirmed by each Rating Agency in writing and, which, as
evidenced by an Opinion of Counsel at the expense of the party (other than the
Trustee, unless such amendment modifies or otherwise relates solely to the
obligations, duties or rights of the Trustee) requesting such amendment, shall
not adversely affect in any material respect the interests of any
Certificateholder.
A-7-6
<PAGE> 250
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of the Pooling and Servicing Agreement or of modifying in any
manner the rights of the Certificateholders; provided, however, that no such
amendment shall: (i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of each affected Certificateholder; (ii) change
the percentages of Voting Rights of Holders of Certificates which are required
to consent to any action or inaction under the Pooling and Servicing Agreement,
without the consent of the Holders of all Certificates then outstanding; or (ii)
alter the servicing standard set forth in the Pooling and Servicing Agreement or
the obligations of the Servicer, the Trustee or the Fiscal Agent to make a P&I
Advance or Property Advance without the consent of the Holders of all
Certificates representing all of the Voting Rights of the Class or Classes
affected thereby.
Further, the Depositor, the Servicer, the Special Servicer, the
Trustee and the Fiscal Agent, at any time and from time to time, without the
consent of the Certificateholders, may amend the Pooling and Servicing Agreement
to modify, eliminate or add to any of its provisions to such extent as shall be
necessary to maintain the qualification of the Trust REMICs as two separate
REMICs, or to prevent the imposition of any additional material state or local
taxes, at all times that any Certificates are outstanding; provided, however,
that such action, as evidenced by an opinion of counsel, is necessary or helpful
to maintain such qualification or to prevent the imposition of any such taxes,
and would not adversely affect in any material respect the interest of any
Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
A-7-7
<PAGE> 251
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee) the
Trustee shall solicit quotes from four Independent
broker-dealer firms for bids for whole loans, and if
the aggregate fair market value of the Mortgage Loans
and all other property acquired in respect of any
Mortgage Loan in the Trust Fund, as determined by the
average of the three highest such quotes, equals or
exceeds the aggregate amount of the Certificate
Balances of all Certificates expected to be
outstanding as of the close of business on the Auction
Proceeds Distribution Date (such aggregate amount, the
"Aggregate Certificate Balance") as well as auction
expenses, the Trustee shall appoint an Auction Agent
to solicit offers from Qualified Offerors to purchase
all (but not less than all) of the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase price
that is less than the Aggregate Certificate Balance,
(c) that provides for purchase on terms other than
all-cash or (d) that is contingent on the occurrence
or non-occurrence of any event (each, a "Deficient
Auction Bid"). If all bids received by the Trustee are
Deficient Auction Bids, the Mortgage Loans shall not
be sold and there shall be no termination of the Trust
Fund pursuant to Section 9.1(d).
(iii) The Trustee is required to accept the highest bid that
is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as described
above; (ii) the later of (a) the distribution to Certificateholders of final
payment with respect to the Mortgage Loans or (b) the disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure with respect
to the Mortgage Loans and the remittance to the Certificateholders of all funds
due under the Pooling and Servicing Agreement; or (iii) the sale of assets of
the Trust Fund after the Certificate Balances or Notional Balances, as
applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created by
the Pooling and Servicing Agreement continue beyond the expiration of 21 years
from the death of the last surviving descendant(s) of Joseph P. Kennedy, the
late ambassador of the United States to the United Kingdom, living on the date
hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate
A-7-8
<PAGE> 252
shall not be entitled to any benefit under the Pooling and Servicing Agreement
or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-7-9
<PAGE> 253
IN WITNESS WHEREOF, the Trustee has caused this Class E
Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual capacity
but solely as Trustee
By:______________________________
Authorized Officer
Certificate of Authentication
This is the Class E Certificate referred to in the Pooling and
Servicing Agreement.
LASALLE NATIONAL BANK, not in its individual capacity
but solely as Trustee
By:______________________________
Authorized Officer
A-7-10
<PAGE> 254
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto_________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name(s) and address(es), including postal zip code(s)
of assignee(s)) ("Assignee(s)") the entire Percentage Interest represented by
the within Class E Certificate and hereby authorize(s) the registration of
transfer of such interest to Assignee(s) on the Certificate Register of the
Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class E
Certificate of the entire Percentage Interest represented by the within Class E
Certificates to the above-named Assignee(s) and to deliver such Class E
Certificate to the following address:
_______________________________________________________________________
_______________________________________________________________________
Date:______________________ _____________________________
Signature by or on behalf of
Assignor(s)
______________________________
Taxpayer Identification Number
A-7-11
<PAGE> 255
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:__________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
for the account of______________________________________________________________
account number_________________________________________________________________.
This information is provided by_________________the Assignee(s) named above, or
__________________________ as its (their) agent.
By:____________________________
_______________________________
[Please print or type name(s)]
_______________________________
Title
_______________________________
Taxpayer Identification Number
A-7-12
<PAGE> 256
EXHIBIT A-8
THIS CLASS F CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR
INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC")
TO THE CERTIFICATE REGISTRAR FOR THE CERTIFICATES 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 HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR FOREIGN
SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND ONLY (A)(1)
PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL INVESTOR THAT THE
HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE
MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN ACCOUNT OR A PERSON
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A OR (2) TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" WITHIN THE
MEANING OF RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE 1933 ACT
AND (B) IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES.
A-8-1
<PAGE> 257
THIS CLASS F CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS
A-2, CLASS A-EC, CLASS B, CLASS C, CLASS D AND CLASS E CERTIFICATES AS AND TO
THE EXTENT SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED BY
A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE,
OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS TO A
MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (A
"SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE COMPANY THAT IS USING
ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR GENERAL ACCOUNT IN WHICH THE
ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE DEEMED PURSUANT TO ERISA OR ANY
SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS) OTHER THAN AN INSURANCE COMPANY
USING ASSETS OF ITS GENERAL ACCOUNT IN CIRCUMSTANCES WHEREBY SUCH PURCHASE OR
TRANSFER AND THE SUBSEQUENT HOLDING WOULD NOT CONSTITUTE OR RESULT IN A
PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA,
SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, OR (C) ANY OTHER PERSON ACTING ON
BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH PLAN. EACH PROSPECTIVE
TRANSFEREE OF THIS CERTIFICATE WILL BE REQUIRED TO DELIVER TO THE DEPOSITOR, THE
CERTIFICATE REGISTRAR AND THE TRUSTEE, (I) A TRANSFEREE REPRESENTATION LETTER,
SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, STATING THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON
REFERRED TO IN CLAUSE (A), (B) OR (C) ABOVE, OR (II) AN OPINION OF COUNSEL WHICH
ESTABLISHES TO THE SATISFACTION OF THE DEPOSITOR, THE TRUSTEE AND THE
CERTIFICATE REGISTRAR THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT
RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND
SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF
ERISA, THE CODE OR ANY SIMILAR LAW, AND WILL NOT CONSTITUTE OR RESULT IN A
PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA,
SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, AND WILL NOT SUBJECT THE SERVICER,
THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE OR THE CERTIFICATE REGISTRAR TO
ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR
SECTION 4975 OF THE CODE), WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF
THE TRUSTEE, THE TRUST FUND, THE SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE
REGISTRAR OR THE DEPOSITOR.
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<PAGE> 258
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT IF
THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE WITH
FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(A)(1) AND 860D OF THE CODE.
A-8-3
<PAGE> 259
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS F
Initial Pass-Through Rate: 8.567%1
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class F Certificates: November 25, 2015
$5,557,000
CUSIP: 74436JDA2 Initial Class Certificate
Balance of this
Certificate: $5,557,000
No.: 1
This certifies that Cede & Co. is the registered owner of a
beneficial ownership interest in a Trust Fund, including the distributions to be
made with respect to the Class F Certificates. The Trust Fund, described more
fully below, consists primarily of a pool of commercial Mortgage Loans secured
by first liens on commercial and multifamily properties and held in trust by the
Trustee and serviced by the Servicer. The Trust Fund was created, and the
Mortgage Loans are to be serviced, pursuant to the Pooling and Servicing
Agreement (as defined below). The Holder of this Certificate, by virtue of the
acceptance hereof, assents to the terms, provisions and conditions of the
Pooling and Servicing Agreement and is bound thereby. Also issued under the
Pooling and Servicing Agreement are the Class A-1, Class A-2, Class A-EC, Class
B, Class C, Class D, Class E, Class G, Class H, Class J-1, Class J-2, Class R
and Class LR Certificates (together with the Class F Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling and
Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance with,
the terms of a Pooling and Servicing Agreement, dated as of December 1, 1995
(the "Pooling and Servicing
- --------------------
1 The Pass-Through Rate shown is the rate for the Distribution Date
occurring in January, 1996. The Pass-Through Rate for Interest Accrual
Periods related to all subsequent Distribution Dates shall be a per
annum rate equal to the higher of (i) the Weighted Average Net Mortgage
Rate (calculated as provided in the Pooling and Servicing Agreement)
and (ii) 7.64%.
A-8-4
<PAGE> 260
Agreement"), by and among Prudential Securities Secured Financing Corporation,
as depositor (the "Depositor"), Midland Loan Services, L.P., as servicer (the
"Servicer"), Lennar Partners, Inc., as special servicer (the "Special
Servicer"), LaSalle National Bank, as trustee (the "Trustee"), and ABN AMRO Bank
N.V., as fiscal agent for the Trustee (the "Fiscal Agent"). To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling and Servicing Agreement.
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to such
Person's pro rata share (based on the Percentage Interest represented by this
Certificate after taking into account transfers and exchanges occurring prior to
the related Record Date) of that portion of the aggregate amount of principal
and interest then distributable, if any, allocable to the Class F Certificates
for such Distribution Date, all as more fully described in the Pooling and
Servicing Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class F Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the higher of the
Weighted Average Net Mortgage Rate on the outstanding Certificate Balance hereof
and 7.64%. The Weighted Average Net Mortgage Rate with respect to any Interest
Accrual Period is a per annum rate equal to the weighted average of the Net
Mortgage Rates, as of the related Due Date. All calculations of interest on the
Class F Certificates will be made on the basis of a 360-day year consisting of
twelve 30-day months.
Interest accrued on this Certificate during an Interest Accrual
Period, net of this Certificate's pro rata share of any Uncovered Prepayment
Interest Shortfalls for the Distribution Date following such Interest Accrual
Period, plus the aggregate unpaid Class Interest Shortfall with respect to this
Certificate, if any, will be payable on the related Distribution Date to the
extent provided in the Pooling and Servicing Agreement. The "Interest Accrual
Period" with
A-8-5
<PAGE> 261
respect to any Distribution Date is the calendar month preceding the month in
which such Distribution Date occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made (a)
by wire transfer in immediately available funds to the account specified by the
Certificateholder at a bank or other entity located in the United States having
appropriate facilities therefor, if such Certificateholder provides the Trustee
with wiring instructions no less than five Business Days prior to the related
Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of this Certificate at the location specified in the
notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which notice
of the Termination Date has been given pursuant to Section 9.1 of the Pooling
and Servicing Agreement shall not have been surrendered for cancellation within
six months after the time specified in such notice, the Servicer shall mail a
second notice to the remaining Certificateholders, at their last addresses shown
in the Certificate Register, to surrender their Certificates for cancellation in
order to receive, from such funds held, the final distribution with respect
thereto. If within one year after the second notice any Certificate shall not
have been surrendered for cancellation, the Servicer may, directly or through an
agent, take appropriate steps to contact the remaining Certificateholders
concerning surrender of their Certificates. The costs and expenses of
maintaining such funds and of contacting Certificateholders shall be paid out of
the assets which remain held. If within two years after the second notice any
Certificates shall not have been surrendered for cancellation, the Paying Agent
shall pay to the Servicer all amounts distributable to the Holders thereof, at
which time the obligations of the Trustee to such Holders with respect to such
amounts shall terminate, and the Servicer shall thereafter hold such amounts for
the benefit of such Holders. No interest shall accrue or be payable to any
Certificateholder on any amount held as a result of such Certificateholder's
failure to surrender its Certificate(s) for final payment thereof in accordance
with Section 9.1 of the Pooling and Servicing Agreement. Such funds held by the
Servicer shall not be invested.
This Certificate is limited in right of payment to, among other
things, certain collections and recoveries in respect of the Mortgage Loans, as
more specifically set forth herein and in the Pooling and Servicing Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying
A-8-6
<PAGE> 262
Agent will be authorized to make withdrawals therefrom. Amounts on deposit in
such accounts may be invested in Permitted Investments. Interest or other income
earned on funds in the Collection Account and the Distribution Account will be
paid to the Servicer or the Depositor as set forth in the Pooling and Servicing
Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this Certificate
for registration of transfer at the corporate trust office of the Certificate
Registrar or at the office of any transfer agent. The Certificate Registrar
shall require that this Certificate be duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Certificate Registrar
duly executed by, the Holder hereof or such Holder's attorney duly authorized in
writing. Thereupon, one or more new Certificates without coupons of a like
aggregate Percentage Interest of the same Class in authorized denominations will
be executed by the Trustee or the Authenticating Agent and authenticated by the
Authenticating Agent and delivered by the Certificate Registrar to the
designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each transferor
of a sum sufficient to cover any tax, expense or other governmental charge
payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions therein that may be inconsistent with any other provisions therein,
(iii) to amend any provision thereof to the extent necessary or desirable to
maintain the rating or ratings assigned to each of the Classes of Regular
Certificates by each
A-8-7
<PAGE> 263
Rating Agency, or (iv) to make any other provisions with respect to matters or
questions arising under the Pooling and Servicing Agreement, which shall not be
inconsistent with the provisions of the Pooling and Servicing Agreement and will
not result in the downgrading, withdrawal or qualification of the rating or
ratings then assigned to any outstanding Class of Certificates, as confirmed by
each Rating Agency in writing and, which, as evidenced by an Opinion of Counsel
at the expense of the party (other than the Trustee, unless such amendment
modifies or otherwise relates solely to the obligations, duties or rights of the
Trustee) requesting such amendment, shall not adversely affect in any material
respect the interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66 2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of the Pooling and Servicing Agreement or of modifying in any
manner the rights of the Certificateholders; provided, however, that no such
amendment shall: (i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of each affected Certificateholder; (ii) change
the percentages of Voting Rights of Holders of Certificates which are required
to consent to any action or inaction under the Pooling and Servicing Agreement,
without the consent of the Holders of all Certificates then outstanding; or (ii)
alter the servicing standard set forth in the Pooling and Servicing Agreement or
the obligations of the Servicer, the Trustee or the Fiscal Agent to make a P&I
Advance or Property Advance without the consent of the Holders of all
Certificates representing all of the Voting Rights of the Class or Classes
affected thereby.
Further, the Depositor, the Servicer, the Special Servicer, the
Trustee and the Fiscal Agent, at any time and from time to time, without the
consent of the Certificateholders, may amend the Pooling and Servicing Agreement
to modify, eliminate or add to any of its provisions to such extent as shall be
necessary to maintain the qualification of the Trust REMICs as two separate
REMICs, or to prevent the imposition of any additional material state or local
taxes, at all times that any Certificates are outstanding; provided, however,
that such action, as evidenced by an opinion of counsel, is necessary or helpful
to maintain such qualification or to prevent the imposition of any such taxes,
and would not adversely affect in any material respect the interest of any
Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates,
A-8-8
<PAGE> 264
on any Distribution Date on which the aggregate Scheduled Principal Balance of
the Mortgage Loans remaining in the Trust Fund is less than 10% of the aggregate
Scheduled Principal Balance of the Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid that
is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as described
above; (ii) the later of (a) the distribution to Certificateholders of final
payment with respect to the Mortgage Loans or (b) the disposition of all
property acquired upon foreclosure or deed in lieu of foreclosure with respect
to the Mortgage Loans and the remittance to the Certificateholders of all funds
due under the Pooling and Servicing Agreement; or (iii) the sale of assets of
the Trust Fund after the Certificate Balances or Notional Balances, as
applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been
A-8-9
<PAGE> 265
reduced to zero under circumstances set forth in the Pooling and Servicing
Agreement. In no event, however, will the trust created by the Pooling and
Servicing Agreement continue beyond the expiration of 21 years from the death of
the last surviving descendant(s) of Joseph P. Kennedy, the late ambassador of
the United States to the United Kingdom, living on the date hereof.
This Certificate is issued on December 22, 1995, and based on
its issue price of ________%, including accrued interest, and a stated
redemption price at maturity equal to its initial principal balance (plus one
day of interest at the initial pass-through rate hereon), is issued with
original issue discount ("OID") for federal income tax purposes. Assuming (a)
that this Certificate pays in accordance with projected cash flows reflecting
the prepayment assumption described in Scenario 2 (as defined in the Private
Placement Memorandum dated December 22, 1995 with respect to the offering of the
Certificates) used to price this Certificate and (b) that the interest rate at
which distributions of interest on this Certificate actually will be made will
be determined as though the pass-through rate on this Certificate applicable to
the first Distribution Date will change only to reflect the maturity of the
Mortgage Loans: (i) the amount of OID as a percentage of the initial principal
balance of this Certificate is approximately ___________; (ii) the annual yield
to maturity of this Certificate, compounded monthly, is approximately _____%;
and (iii) the amount of OID allocable to the first accrual period (December 22,
1995 to January 25, 1996) as a percentage of the initial principal balance of
this Certificate, calculated using the exact method, is approximately ________%.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit under
the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-8-10
<PAGE> 266
IN WITNESS WHEREOF, the Trustee has caused this Class F
Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By: ______________________________
Authorized Officer
Certificate of Authentication
This is the Class F Certificate referred to in the Pooling and
Servicing Agreement.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By: _______________________________
Authorized Officer
A-8-11
<PAGE> 267
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto ________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class F Certificate and
hereby authorize(s) the registration of transfer of such interest to Assignee(s)
on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class F
Certificate of the entire Percentage Interest represented by the within Class F
Certificates to the above_named Assignee(s) and to deliver such Class F
Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Date: _________________________
___________________________________________
Signature by or on behalf of
Assignor(s)
___________________________________________
Taxpayer Identification Number
A-8-12
<PAGE> 268
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions: _________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
________________________________________________________________________________
for the account of_____________________________________________________
account number__________________________________
This information is provided by __________________________________ the
Assignee(s) named above, or ________________________________ as its (their)
agent.
By:____________________________________
_______________________________________
[Please print or type name(s)]
_______________________________________
Title
_______________________________________
Taxpayer Identification Number
A-8-13
<PAGE> 269
EXHIBIT A-9
THIS CLASS G CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A)(1) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL
INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN
ACCOUNT OR A PERSON PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
THIS CLASS G CERTIFICATE IS SUBORDINATE TO THE CLASS A-1,
CLASS A-2, CLASS A-EC, CLASS B, CLASS C, CLASS D, CLASS E AND CLASS F
CERTIFICATES AS AND TO THE EXTENT SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED
BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975
OF THE CODE, OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW
WHICH IS TO A MATERIAL EXTENT SIMILAR TO THE FOREGOING
A-9-1
<PAGE> 270
PROVISIONS OF ERISA OR THE CODE (A "SIMILAR LAW") (EACH, A "PLAN"), OR (B)
AN INSURANCE COMPANY THAT IS USING ASSETS OF ANY INSURANCE COMPANY SEPARATE
ACCOUNT OR GENERAL ACCOUNT IN WHICH THE ASSETS OF SUCH PLAN ARE INVESTED (OR
WHICH ARE DEEMED PURSUANT TO ERISA OR ANY SIMILAR LAW TO INCLUDE ASSETS OF SUCH
PLANS) OTHER THAN AN INSURANCE COMPANY USING ASSETS OF ITS GENERAL ACCOUNT IN
CIRCUMSTANCES WHEREBY SUCH PURCHASE OR TRANSFER AND THE SUBSEQUENT HOLDING
WOULD NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING
OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW,
OR (C) ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS
OF ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE
REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE
TRUSTEE, (I) A TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF
EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING
THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B)
OR (C) ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE
SATISFACTION OF THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT
THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF
THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, THE CODE OR ANY
SIMILAR LAW, AND WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION
WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR
ANY SIMILAR LAW, AND WILL NOT SUBJECT THE SERVICER, THE SPECIAL SERVICER, THE
DEPOSITOR, THE TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR
LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF
THE CODE), WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE
TRUST FUND, THE SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR
THE DEPOSITOR.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
A-9-2
<PAGE> 271
INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE.
A-9-3
<PAGE> 272
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS G
<TABLE>
<S> <C>
Initial Pass-Through Rate: 8.567%(1)
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class G Certificates: November 25, 2015
$12,226,000
CUSIP: 74436JDB0 Initial Class Certificate Balance of this
Certificate: $12,226,000
No.: 1 Registered Owner: Prudential Securities Incorporated
</TABLE>
This certifies that Prudential Securities Incorporated is the
registered owner of a beneficial ownership interest in a Trust Fund, including
the distributions to be made with respect to the Class G Certificates. The
Trust Fund, described more fully below, consists primarily of a pool of
commercial Mortgage Loans secured by first liens on commercial and multifamily
properties and held in trust by the Trustee and serviced by the Servicer. The
Trust Fund was created, and the Mortgage Loans are to be serviced, pursuant to
the Pooling and Servicing Agreement (as defined below). The Holder of this
Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling and Servicing Agreement and is bound
thereby. Also issued under the Pooling and Servicing Agreement are the Class
A-1, Class A-2, Class A-EC, Class B, Class C, Class D, Class E, Class F, Class
H, Class J-1, Class J-2, Class R and Class LR Certificates (together with the
Class G Certificates, the "Certificates"; the Holders of Certificates issued
under the Pooling and Servicing Agreement are collectively referred to herein
as "Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing
____________________
(1) The Pass-Through Rate shown is the rate for the Distribution Date occurring
in January, 1996. The Pass-Through Rate for Interest Accrual Periods
related to all subsequent Distribution Dates shall be a per annum rate
equal to the higher of (i) the Weighted Average Net Mortgage Rate
(calculated as provided in the Pooling and Servicing Agreement) and (ii)
7.64%.
A-9-4
<PAGE> 273
Agreement"), by and among Prudential Securities Secured Financing Corporation,
as depositor (the "Depositor"), Midland Loan Services, L.P., as servicer (the
"Servicer"), Lennar Partners, Inc., as special servicer (the "Special
Servicer"), LaSalle National Bank, as trustee (the "Trustee"), and ABN AMRO
Bank N.V., as fiscal agent for the Trustee (the "Fiscal Agent"). To the
extent not defined herein, capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class G
Certificates for such Distribution Date, all as more fully described in the
Pooling and Servicing Agreement. Holders of this Certificate may be entitled
to Prepayment Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class G Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the higher of the
Weighted Average Net Mortgage Rate on the outstanding Certificate Balance
hereof and 7.64%. The Weighted Average Net Mortgage Rate with respect to any
Interest Accrual Period is a per annum rate equal to the weighted average of
the Net Mortgage Rates, as of the related Due Date. All calculations of
interest on the Class G Certificates will be made on the basis of a 360-day
year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with
A-9-5
<PAGE> 274
respect to any Distribution Date is the calendar month preceding the month in
which such Distribution Date occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of this Certificate at the location specified in the
notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on any
amount held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer shall not be
invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying
A-9-6
<PAGE> 275
Agent will be authorized to make withdrawals therefrom. Amounts on deposit in
such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Collection Account and the Distribution Account
will be paid to the Servicer or the Depositor as set forth in the Pooling and
Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each
A-9-7
<PAGE> 276
Rating Agency, or (iv) to make any other provisions with respect to matters or
questions arising under the Pooling and Servicing Agreement, which shall not be
inconsistent with the provisions of the Pooling and Servicing Agreement and
will not result in the downgrading, withdrawal or qualification of the rating
or ratings then assigned to any outstanding Class of Certificates, as confirmed
by each Rating Agency in writing and, which, as evidenced by an Opinion of
Counsel at the expense of the party (other than the Trustee, unless such
amendment modifies or otherwise relates solely to the obligations, duties or
rights of the Trustee) requesting such amendment, shall not adversely affect in
any material respect the interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66-2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates,
A-9-8
<PAGE> 277
on any Distribution Date on which the aggregate Scheduled Principal Balance of
the Mortgage Loans remaining in the Trust Fund is less than 10% of the
aggregate Scheduled Principal Balance of the Mortgage Loans as of the Cut-off
Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been
A-9-9
<PAGE> 278
reduced to zero under circumstances set forth in the Pooling and Servicing
Agreement. In no event, however, will the trust created by the Pooling and
Servicing Agreement continue beyond the expiration of 21 years from the death
of the last surviving descendant(s) of Joseph P. Kennedy, the late ambassador
of the United States to the United Kingdom, living on the date hereof.
This Certificate is issued on December 22, 1995, and based on
its issue price of ________%, including accrued interest, and a stated
redemption price at maturity equal to its initial principal balance (plus one
day of interest at the initial pass-through rate hereon), is issued with
original issue discount ("OID") for federal income tax purposes. Assuming
(a) that this Certificate pays in accordance with projected cash flows
reflecting the prepayment assumption described in Scenario 2 (as defined in the
Private Placement Memorandum dated December 22, 1995 with respect to the
offering of the Certificates) used to price this Certificate and (b) that the
interest rate at which distributions of interest on this Certificate actually
will be made will be determined as though the pass-through rate on this
Certificate applicable to the first Distribution Date will change only to
reflect the maturity of the Mortgage Loans: (i) the amount of OID as a
percentage of the initial principal balance of this Certificate is
approximately ___________; (ii) the annual yield to maturity of this
Certificate, compounded monthly, is approximately _____%; and (iii) the amount
of OID allocable to the first accrual period (December 22, 1995 to January 25,
1996) as a percentage of the initial principal balance of this Certificate,
calculated using the exact method, is approximately ________%.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-9-10
<PAGE> 279
IN WITNESS WHEREOF, the Trustee has caused this Class G
Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By: _______________________________________
Authorized Officer
Certificate of Authentication
This is the Class G Certificate referred to in the Pooling and
Servicing Agreement.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By: _______________________________________
Authorized Officer
A-9-11
<PAGE> 280
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto _______________________________________
_______________________________________________________________________________
_______________________________________________________________________________
____________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class G Certificate and
hereby authorize(s) the registration of transfer of such interest to
Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class G
Certificate of the entire Percentage Interest represented by the within Class G
Certificates to the above-named Assignee(s) and to deliver such Class G
Certificate to the following address:
_______________________________________________________________________________
_______________________________________________________________________________
Date: _________________________ _____________________________________
Signature by or on behalf of
Assignor(s)
_____________________________________
Taxpayer Identification Number
A-9-12
<PAGE> 281
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions: ________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
_______________________________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________
account number________________________________________________________________.
This information is provided by __________________________________ the
Assignee(s) named above, or ________________________________ as its (their)
agent.
By:_____________________________________
________________________________________
[Please print or type name(s)]
________________________________________
Title
________________________________________
Taxpayer Identification Number
A-9-13
<PAGE> 282
EXHIBIT A-10
THIS CLASS H CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A)(1) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL
INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN
ACCOUNT OR A PERSON PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
THIS CLASS H CERTIFICATE IS SUBORDINATE TO THE CLASS A-1,
CLASS A-2, CLASS A-EC, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F AND CLASS G
CERTIFICATES AS AND TO THE EXTENT SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED
BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975
OF THE CODE, OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW
WHICH IS TO A MATERIAL EXTENT SIMILAR TO THE FOREGOING
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PROVISIONS OF ERISA OR THE CODE (A "SIMILAR LAW") (EACH, A "PLAN"), OR (B)
AN INSURANCE COMPANY THAT IS USING ASSETS OF ANY INSURANCE COMPANY SEPARATE
ACCOUNT OR GENERAL ACCOUNT IN WHICH THE ASSETS OF SUCH PLAN ARE INVESTED (OR
WHICH ARE DEEMED PURSUANT TO ERISA OR ANY SIMILAR LAW TO INCLUDE ASSETS OF SUCH
PLANS) OTHER THAN AN INSURANCE COMPANY USING ASSETS OF ITS GENERAL ACCOUNT IN
CIRCUMSTANCES WHEREBY SUCH PURCHASE OR TRANSFER AND THE SUBSEQUENT HOLDING
WOULD NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING
OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW,
OR (C) ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS
OF ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE
REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE
TRUSTEE, (I) A TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF
EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING
THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B)
OR (C) ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE
SATISFACTION OF THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT
THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF
THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, THE CODE OR ANY
SIMILAR LAW, AND WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION
WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR
ANY SIMILAR LAW, AND WILL NOT SUBJECT THE SERVICER, THE SPECIAL SERVICER, THE
DEPOSITOR, THE TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR
LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF
THE CODE), WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE
TRUST FUND, THE SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR
THE DEPOSITOR.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
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INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE.
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PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS H
<TABLE>
<S> <C>
Initial Pass-Through Rate: 8.567%(1)
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class H Certificates: November 25, 2015
$11,114,000
CUSIP: 74436JDC8 Initial Class Certificate Balance of this
Certificate: $11,114,000
No.: 1 Registered Owner: Prudential Securities Incorporated
</TABLE>
This certifies that Prudential Securities Incorporated is the
registered owner of a beneficial ownership interest in a Trust Fund, including
the distributions to be made with respect to the Class H Certificates. The
Trust Fund, described more fully below, consists primarily of a pool of
commercial Mortgage Loans secured by first liens on commercial and multifamily
properties and held in trust by the Trustee and serviced by the Servicer. The
Trust Fund was created, and the Mortgage Loans are to be serviced, pursuant to
the Pooling and Servicing Agreement (as defined below). The Holder of this
Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling and Servicing Agreement and is bound
thereby. Also issued under the Pooling and Servicing Agreement are the Class
A-1, Class A-2, Class A-EC, Class B, Class C, Class D, Class E, Class F, Class
G, Class J-1, Class J-2, Class R and Class LR Certificates (together with the
Class H Certificates, the "Certificates"; the Holders of Certificates issued
under the Pooling and Servicing Agreement are collectively referred to herein
as "Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing
____________________
(1) The Pass-Through Rate shown is the rate for the Distribution Date occurring
in January, 1996. The Pass-Through Rate for Interest Accrual Periods
related to all subsequent Distribution Dates shall be a per annum rate
equal to the higher of (i) the Weighted Average Net Mortgage Rate
(calculated as provided in the Pooling and Servicing Agreement) and (ii)
7.64%.
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<PAGE> 286
Agreement"), by and among Prudential Securities Secured Financing Corporation,
as depositor (the "Depositor"), Midland Loan Services, L.P., as servicer (the
"Servicer"), Lennar Partners, Inc., as special servicer (the "Special
Servicer"), LaSalle National Bank, as trustee (the "Trustee"), and ABN AMRO
Bank N.V., as fiscal agent for the Trustee (the "Fiscal Agent"). To the
extent not defined herein, capitalized terms used herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class H
Certificates for such Distribution Date, all as more fully described in the
Pooling and Servicing Agreement. Holders of this Certificate may be entitled
to Prepayment Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class H Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the higher of the
Weighted Average Net Mortgage Rate on the outstanding Certificate Balance
hereof and 7.64%. The Weighted Average Net Mortgage Rate with respect to any
Interest Accrual Period is a per annum rate equal to the weighted average of
the Net Mortgage Rates, as of the related Due Date. All calculations of
interest on the Class H Certificates will be made on the basis of a 360-day
year consisting of twelve 30-day months.
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with
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<PAGE> 287
respect to any Distribution Date is the calendar month preceding the month in
which such Distribution Date occurs.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of this Certificate at the location specified in the
notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on any
amount held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer shall not be
invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying
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<PAGE> 288
Agent will be authorized to make withdrawals therefrom. Amounts on deposit in
such accounts may be invested in Permitted Investments. Interest or other
income earned on funds in the Collection Account and the Distribution Account
will be paid to the Servicer or the Depositor as set forth in the Pooling and
Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each
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<PAGE> 289
Rating Agency, or (iv) to make any other provisions with respect to matters or
questions arising under the Pooling and Servicing Agreement, which shall not be
inconsistent with the provisions of the Pooling and Servicing Agreement and
will not result in the downgrading, withdrawal or qualification of the rating
or ratings then assigned to any outstanding Class of Certificates, as confirmed
by each Rating Agency in writing and, which, as evidenced by an Opinion of
Counsel at the expense of the party (other than the Trustee, unless such
amendment modifies or otherwise relates solely to the obligations, duties or
rights of the Trustee) requesting such amendment, shall not adversely affect in
any material respect the interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66-2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates,
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<PAGE> 290
on any Distribution Date on which the aggregate Scheduled Principal Balance of
the Mortgage Loans remaining in the Trust Fund is less than 10% of the
aggregate Scheduled Principal Balance of the Mortgage Loans as of the Cut-off
Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been
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<PAGE> 291
reduced to zero under circumstances set forth in the Pooling and Servicing
Agreement. In no event, however, will the trust created by the Pooling and
Servicing Agreement continue beyond the expiration of 21 years from the death
of the last surviving descendant(s) of Joseph P. Kennedy, the late ambassador
of the United States to the United Kingdom, living on the date hereof.
This Certificate is issued on December 22, 1995, and based on
its issue price of ________%, including accrued interest, and a stated
redemption price at maturity equal to its initial principal balance (plus one
day of interest at the initial pass-through rate hereon), is issued with
original issue discount ("OID") for federal income tax purposes. Assuming
(a) that this Certificate pays in accordance with projected cash flows
reflecting the prepayment assumption described in Scenario 2 (as defined in the
Private Placement Memorandum dated December 22, 1995 with respect to the
offering of the Certificates) used to price this Certificate and (b) that the
interest rate at which distributions of interest on this Certificate actually
will be made will be determined as though the pass-through rate on this
Certificate applicable to the first Distribution Date will change only to
reflect the maturity of the Mortgage Loans: (i) the amount of OID as a
percentage of the initial principal balance of this Certificate is
approximately ___________; (ii) the annual yield to maturity of this
Certificate, compounded monthly, is approximately _____%; and (iii) the amount
of OID allocable to the first accrual period (December 22, 1995 to January 25,
1996) as a percentage of the initial principal balance of this Certificate,
calculated using the exact method, is approximately ________%.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
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<PAGE> 292
IN WITNESS WHEREOF, the Trustee has caused this Class H
Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By: _______________________________________
Authorized Officer
Certificate of Authentication
This is the Class H Certificate referred to in the Pooling and
Servicing Agreement.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By: _______________________________________
Authorized Officer
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<PAGE> 293
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto _______________________________________
_______________________________________________________________________________
_______________________________________________________________________________
____________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class H Certificate and
hereby authorize(s) the registration of transfer of such interest to
Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class H
Certificate of the entire Percentage Interest represented by the within Class H
Certificates to the above-named Assignee(s) and to deliver such Class H
Certificate to the following address:
_______________________________________________________________________________
_______________________________________________________________________________
Date: _________________________ _________________________________
Signature by or on behalf of
Assignor(s)
_________________________________
Taxpayer Identification Number
A-10-12
<PAGE> 294
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions: ________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
_______________________________________________________________________________
_______________________________________________________________________________
for the account of_____________________________________________________________
account number________________________________________________________________.
This information is provided by __________________________________ the
Assignee(s) named above, or ________________________________ as its (their)
agent.
By:____________________________________
_______________________________________
[Please print or type name(s)]
_______________________________________
Title
_______________________________________
Taxpayer Identification Number
A-10-13
<PAGE> 295
EXHIBIT A-11
THIS CLASS J-1 CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
PRINCIPAL PAYMENTS ON THIS CERTIFICATE ARE PAYABLE IN
INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
BALANCE OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE INITIAL
CERTIFICATE BALANCE SET FORTH BELOW.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER WHEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A)(1) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL
INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN
ACCOUNT OR A PERSON PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
THIS CLASS J-1 CERTIFICATE IS SUBORDINATE TO THE CLASS A-1,
CLASS A-2, CLASS A-EC, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G AND
CLASS H CERTIFICATES AS AND TO THE EXTENT SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED
BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975
OF THE CODE, OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW
WHICH IS TO A MATERIAL EXTENT SIMILAR TO THE FOREGOING
A-11-1
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PROVISIONS OF ERISA OR THE CODE (A "SIMILAR LAW") (EACH, A "PLAN"), OR (B)
AN INSURANCE COMPANY THAT IS USING ASSETS OF ANY INSURANCE COMPANY SEPARATE
ACCOUNT OR GENERAL ACCOUNT IN WHICH THE ASSETS OF SUCH PLAN ARE INVESTED (OR
WHICH ARE DEEMED PURSUANT TO ERISA OR ANY SIMILAR LAW TO INCLUDE ASSETS OF SUCH
PLANS) OTHER THAN AN INSURANCE COMPANY USING ASSETS OF ITS GENERAL ACCOUNT IN
CIRCUMSTANCES WHEREBY SUCH PURCHASE OR TRANSFER AND THE SUBSEQUENT HOLDING
WOULD NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING
OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW,
OR (C) ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS
OF ANY SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE
REQUIRED TO DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE
TRUSTEE, (I) A TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF
EXHIBIT D-2 TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING
THAT SUCH PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B)
OR (C) ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE
SATISFACTION OF THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT
THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF
THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY
RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, THE CODE OR ANY
SIMILAR LAW, AND WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION
WITHIN THE MEANING OF SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR
ANY SIMILAR LAW, AND WILL NOT SUBJECT THE SERVICER, THE SPECIAL SERVICER, THE
DEPOSITOR, THE TRUSTEE OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR
LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF
THE CODE), WHICH OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE
TRUST FUND, THE SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR
THE DEPOSITOR.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE
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INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS
860G(a)(1) AND 860D OF THE CODE.
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PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS J-1
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Certificate Scheduled Final Distribution Date:
Balance of the Class J-1 Certificates: November 25, 2015
$6,669,173.25
CUSIP: 74436JDD6 Initial Class Certificate Balance of
this Certificate: $6,669,173.25
No: 1 Registered Owner: Prudential
Securities Incorporated
This certifies that Prudential Securities Incorporated is the
registered owner of a beneficial ownership interest in a Trust Fund, including
the distributions to be made with respect to the Class J-1 Certificates. The
Trust Fund, described more fully below, consists primarily of a pool of
commercial Mortgage Loans secured by first liens on commercial and multifamily
properties and held in trust by the Trustee and serviced by the Servicer. The
Trust Fund was created, and the Mortgage Loans are to be serviced, pursuant to
the Pooling and Servicing Agreement (as defined below). The Holder of this
Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling and Servicing Agreement and is bound
thereby. Also issued under the Pooling and Servicing Agreement are the Class
A-1, Class A-2, Class A-EC, Class B, Class C, Class D, Class E, Class F, Class
G, Class H, Class J-2, Class R and Class LR Certificates (together with the
Class J-1 Certificates, the "Certificates"; the Holders of Certificates
issued under the Pooling and Servicing Agreement are collectively referred to
herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential
Securities Secured Financing Corporation, as depositor (the "Depositor"),
Midland Loan Services, L.P., as servicer (the "Servicer"), Lennar Partners,
Inc., as special servicer (the "Special Servicer"), LaSalle National Bank, as
trustee (the "Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the
Trustee (the "Fiscal Agent"). To the extent not defined herein, capitalized
terms used herein shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
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This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal then distributable, if any, allocable to the Class J-1 Certificates
for such Distribution Date, all as more fully described in the Pooling and
Servicing Agreement.
The Class J-1 Certificates are principal-only Certificates.
No interest will accrue on this Certificate.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of this Certificate at the location specified in the
notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the
A-11-5
<PAGE> 300
remaining Certificateholders, at their last addresses shown in the Certificate
Register, to surrender their Certificates for cancellation in order to receive,
from such funds held, the final distribution with respect thereto. If within
one year after the second notice any Certificate shall not have been
surrendered for cancellation, the Servicer may, directly or through an agent,
take appropriate steps to contact the remaining Certificateholders concerning
surrender of their Certificates. The costs and expenses of maintaining such
funds and of contacting Certificateholders shall be paid out of the assets
which remain held. If within two years after the second notice any
Certificates shall not have been surrendered for cancellation, the Paying Agent
shall pay to the Servicer all amounts distributable to the Holders thereof, at
which time the obligations of the Trustee to such Holders with respect to such
amounts shall terminate, and the Servicer shall thereafter hold such amounts
for the benefit of such Holders. No interest shall accrue or be payable to any
Certificateholder on any amount held as a result of such Certificateholder's
failure to surrender its Certificate(s) for final payment thereof in accordance
with Section 9.1 of the Pooling and Servicing Agreement. Such funds held by
the Servicer shall not be invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
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Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66-2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the
A-11-7
<PAGE> 302
Servicer, the Trustee or the Fiscal Agent to make a P&I Advance or Property
Advance without the consent of the Holders of all Certificates representing all
of the Voting Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
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<PAGE> 303
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created
by the Pooling and Servicing Agreement continue beyond the expiration of 21
years from the death of the last surviving descendant(s) of Joseph P. Kennedy,
the late ambassador of the United States to the United Kingdom, living on the
date hereof.
This Certificate is issued on December 22, 1995, at an issue
price of _____ and a stated redemption price at maturity equal to its initial
principal balance, and is issued with original issue discount ("OID") for
federal income tax purposes. Assuming that this Certificate pays in accordance
with projected cash flows reflecting the prepayment assumption described in
Scenario 2 (as defined in the Private Placement Memorandum dated December 22,
1995 with respect to the offering of the Certificates) used to price this
Certificate: (i) the amount of OID as a percentage of the initial principal
balance of this Certificate is approximately ____________; (ii) the annual
yield to maturity of this Certificate, compounded monthly, is approximately
____%; and (iii) the amount of OID allocable to the first accrual period
(December 22, 1995 to January 25, 1996) as a percentage of the initial
principal balance of this Certificate, calculated using the exact method, is
approximately _____________ %.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
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[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-11-10
<PAGE> 305
IN WITNESS WHEREOF, the Trustee has caused this Class J-1
Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By: _______________________________________________
Authorized Officer
Certificate of Authentication
This is the Class J-1 Certificate referred to in the Pooling
and Servicing Agreement.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By: _______________________________________________
Authorized Officer
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<PAGE> 306
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto ________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
_______________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class J-1 Certificate and
hereby authorize(s) the registration of transfer of such interest to
Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class J-1
Certificate of the entire Percentage Interest represented by the within Class
J-1 Certificates to the above-named Assignee(s) and to deliver such Class J-1
Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Date: _________________________ _________________________________________
Signature by or on behalf of
Assignor(s)
_________________________________________
Taxpayer Identification Number
A-11-12
<PAGE> 307
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions: _________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
for the account of______________________________________________________________
account number_________________________________________________________________.
This information is provided by ___________________________________________ the
Assignee(s) named above, or ________________________________ as its (their)
agent.
By:_______________________________________
__________________________________________
[Please print or type name(s)]
__________________________________________
Title
__________________________________________
Taxpayer Identification Number
A-11-13
<PAGE> 308
EXHIBIT A-12
THIS CLASS J-2 CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
TIRE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A)(1) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO ANT INSTITUTIONAL
INVESTOR THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN
ACCOUNT OR A PERSON PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS
INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7)
OF REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
THIS CLASS J-2 CERTIFICATE IS SUBORDINATE TO THE CLASS A-1,
CLASS A-2, CLASS A-EC, CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G AND
CLASS H CERTIFICATES AS AND TO THE EXTENT SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY
NOT BE PURCHASED BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH
PLAN, WHICH IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE CODE, OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR
LOCAL LAW WHICH IS TO A MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF
ERISA OR THE CODE (A "SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE
COMPANY THAT IS USING ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR
GENERAL ACCOUNT IN WHICH THE ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE
DEEMED PURSUANT TO ERISA OR ANY SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS)
OTHER
A-12-1
<PAGE> 309
THAN AN INSURANCE COMPANY USING ASSETS OF ITS GENERAL ACCOUNT IN CIRCUMSTANCES
WHEREBY SUCH PURCHASE OR TRANSFER AND THE SUBSEQUENT HOLDING WOULD NOT
CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION
406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, OR (C) ANY
OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF ANY SUCH
PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE REQUIRED TO
DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE, (I) A
TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING THAT SUCH
PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B) OR (C)
ABOVE, OR (II) AN OPINION OF COUNSEL WHICH ESTABLISHES TO THE SATISFACTION OF
THE DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT THE PURCHASE OR
HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE ASSETS OF THE TRUST FUND
BEING DEEMED TO BE "PLAN ASSETS" AND SUBJECT TO THE FIDUCIARY RESPONSIBILITY
OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, THE CODE OR ANY SIMILAR LAW, AND
WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF
SECTION 406 OR 407 OF ERISA, SECTION 4975 OF THE CODE, OR ANY SIMILAR LAW, AND
WILL NOT SUBJECT THE SERVICER, THE SPECIAL SERVICER, THE DEPOSITOR, THE TRUSTEE
OR THE CERTIFICATE REGISTRAR TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE CODE), WHICH
OPINION OF COUNSEL SHALL NOT BE AN EXPENSE OF THE TRUSTEE, THE TRUST FUND, THE
SERVICER, THE SPECIAL SERVICER, THE CERTIFICATE REGISTRAR OR THE DEPOSITOR.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
TRANSFERS AND EXCHANGES OF PORTIONS OF THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS AS PROVIDED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO IN THIS CERTIFICATE.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(a)(1) AND 860D OF THE
CODE.
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PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS J-2
Initial Pass-Through Rate: 8.567%(1)
First Distribution Date: Cut-off Date: December 1, 1995
January 25, 1996
Aggregate Initial Class Notional Scheduled Final Distribution Date:
Balance of the Class J-2 Certificates: November 25, 2015
$6,669,173.25
CUSIP: 74436JDE4 Initial Class Notional Balance of
this Certificate: $6,669,173.25
No.: 1 Registered Owner: Prudential
Securities Incorporated
This certifies that Prudential Securities Incorporated is the
registered owner of a beneficial ownership interest in a Trust Fund, including
the distributions to be made with respect to the Class J-2 Certificates. The
Trust Fund, described more fully below, consists primarily of a pool of
commercial Mortgage Loans secured by first liens on commercial and multifamily
properties and held in trust by the Trustee and serviced by the Servicer. The
Trust Fund was created, and the Mortgage Loans are to be serviced, pursuant to
the Pooling and Servicing Agreement (as defined below). The Holder of this
Certificate, by virtue of the acceptance hereof, assents to the terms,
provisions and conditions of the Pooling and Servicing Agreement and is bound
thereby Also issued under the Pooling and Servicing Agreement are the Class A-1,
Class A-2, Class A-EC, Class B, Class C, Class D, Class E, Class F, Class G,
Class H, Class J-1, Class R and Class LR Certificates (together with the Class
J-2 Certificates, the "Certificates"; the Holders of Certificates issued under
the Pooling and Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing
______________________
(1) The Pass-Through Rate shown is the rate for the Distribution Date
occurring in January, 1996. The Pass-Through Rate for Interest Accrual
Periods related to all subsequent Distribution Dates shall be a per annum
rate equal to the Weighted Average Net Mortgage Rate (calculated as
provided in the Pooling and Servicing Agreement).
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Agreement"), by and among Prudential Securities Secured Financing Corporation,
as depositor (the "Depositor"), Midland Loan Services, L.P., as servicer (the
"Servicer"), Lennar Partners, Inc., as special servicer (the "Special
Servicer"), LaSalle National Bank, as trustee (the "Trustee"), and ABN AMRO Bank
N.V., as fiscal agent for the Trustee (the "Fiscal Agent"). To the extent not
defined herein, capitalized terms used herein shall have the meanings assigned
thereto in the Pooling and Servicing Agreement.
This Certificate is a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined, respectively, in
Sections 860G(a)(1) and 860D of the Internal Revenue Code of 1986, as amended.
Each Holder of this Certificate, by acceptance hereof, agrees to treat, and to
take no action inconsistent with the treatment of, this Certificate in
accordance with the preceding sentence for purposes of federal income taxes,
state and local income and franchise taxes and other taxes imposed on or
measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the Person in whose name this
Certificate is registered as of the related Record Date, an amount equal to
such Person's pro rata share (based on the Percentage Interest represented by
this Certificate after taking into account transfers and exchanges occurring
prior to the related Record Date) of that portion of the aggregate amount of
principal and interest then distributable, if any, allocable to the Class J-2
Certificates for such Distribution Date, all as more fully described in the
Pooling and Servicing Agreement. Holders of this Certificate may be entitled
to Prepayment Premiums as provided in the Pooling and Servicing Agreement.
Interest will accrue on the Class J-2 Certificates during each
Interest Accrual Period (as defined below) at a rate equal to the Weighted
Average Net Mortgage Rate on the outstanding Notional Balance hereof. The
Weighted Average Net Mortgage Rate with respect to any Interest Accrual Period
is a per annum rate equal to the weighted average of the Net Mortgage Rates, as
of the related Due Date. All calculations of interest on the Class J-2
Certificates will be made on the basis of a 360-day year consisting of twelve
30-day months.
Interest accrued on this Certificate during an Interest
Accrual Period, net of this Certificate's pro rata share of any Uncovered
Prepayment Interest Shortfalls for the Distribution Date following such
Interest Accrual Period, plus the aggregate unpaid Class Interest Shortfall
with respect to this Certificate, if any, will be payable on the related
Distribution Date to the extent provided in the Pooling and Servicing
Agreement. The "Interest Accrual Period" with respect to any Distribution
Date is the calendar month preceding the month in which such Distribution Date
occurs.
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All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of Certificates the aggregate
Certificate Balance or Notional Balance, as applicable, of which is at least
$5,000,000, or otherwise (b) by check mailed to such Certificateholder. The
final distribution on this Certificate shall be made in like manner upon
presentation and surrender of this Certificate at the location specified in the
notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Trustee to such Holders with respect to such amounts shall terminate, and
the Servicer shall thereafter hold such amounts for the benefit of such
Holders. No interest shall accrue or be payable to any Certificateholder on any
amount held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer shall not be
invested.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the
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<PAGE> 313
Collection Account and the Distribution Account will be paid to the Servicer or
the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge shall be imposed by the Certificate
Registrar for its services in respect of any registration of transfer or
exchange of this Certificate referred to in Section 5.2 of the Pooling and
Servicing Agreement. In connection with any transfer to an Institutional
Accredited Investor, the transferor shall reimburse the Trust for any costs
(including the cost of the Certificate Registrar's counsel's review of the
documents and any legal opinions, submitted by the transferor or transferee to
the Certificate Registrar as provided in Section 5.2 of the Pooling and
Servicing Agreement) incurred by the Certificate Registrar in connection with
such transfer. The Certificate Registrar may require payment by each
transferor of a sum sufficient to cover any tax, expense or other governmental
charge payable in connection with any such transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions
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<PAGE> 314
of the Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66-2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage
A-12-7
<PAGE> 315
Loans remaining in the Trust Fund is less than 10% of the aggregate Scheduled
Principal Balance of the Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no
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<PAGE> 316
event, however, will the trust created by the Pooling and Servicing Agreement
continue beyond the expiration of 21 years from the death of the last surviving
descendant(s) of Joseph P. Kennedy, the late ambassador of the United States to
the United Kingdom, living on the date hereof.
This Certificate is issued on December 22, 1995, at an issue
price of ____% of the initial Class J-2 Notional Balance, including accrued
interest, and a stated redemption price at maturity equal to all interest
distributions hereon, and is issued with original issue discount ("OID") for
federal income tax purposes. Assuming (a) that this Certificate pays in
accordance with projected cash flows reflecting the prepayment assumption
described in Scenario 2 (as defined in the Private Placement Memorandum dated
December 22, 1995 with respect to the offering of the Certificates) used to
price this Certificate and (b) that the interest rate at which distributions of
interest on this Certificate actually will be made will be determined as though
the pass-through rate on this Certificate applicable to the first Distribution
Date will change only to reflect the maturity of the Mortgage Loans: (i) the
amount of OID as a percentage of the initial Class J-2 Notional Balance is
approximately ____________%; (ii) the annual yield to maturity of this
Certificate, compounded monthly, is approximately ____%; and (iii) the amount
of OID allocable to the first accrual period (December 22, 1995 to January 25,
1996) as a percentage of the initial Class J-2 Notional Balance, calculated
using the exact method, is approximately __________%.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
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<PAGE> 317
IN WITNESS WHEREOF, the Trustee has caused this Class
J-2 Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:_________________________________________
Authorized Officer
Certificate of Authentication
This is the Class J-2 Certificate referred to in the
Pooling and Servicing Agreement.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:_________________________________________
Authorized Officer
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<PAGE> 318
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto ________________________________________
________________________________________________________________________________
________________________________________________________________________________
_________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class J-2 Certificate and
hereby authorize(s) the registration of transfer of such interest to
Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class J-2
Certificate of the entire Percentage Interest represented by the within Class
J-2 Certificates to the above-named Assignee(s) and to deliver such Class J-2
Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Date: _______________ _____________________________________________
Signature by or on behalf of Assignor(s)
_____________________________________________
Taxpayer Identification Number
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<PAGE> 319
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:__________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
________________________________________________________________________________
_________ for the account of____________________________________________________
_________ account number __________________________________________.
This information is provided by ______________________________ the Assignee(s)
named above, or ___________________________________ as its (their) agent.
By:________________________________________
________________________________________
[Please print or type name(s)]
________________________________________
Title
________________________________________
Taxpayer Identification Number
A-12-12
<PAGE> 320
EXHIBIT A-13
THIS CLASS R CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE, MORTGAGE INVESTMENT CONDUIT" AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(a)(2) AND 860D OF THE
CODE. A TRANSFEREE OF THIS CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO
HAVE ACCEPTED THIS CERTIFICATE SUBJECT TO CERTAIN RESTRICTIONS ON
TRANSFERABILITY, AS SET FORTH IN SECTION 5.2(j) OF THE POOLING AND SERVICING
AGREEMENT, AND SHALL BE REQUIRED TO FURNISH AN AFFIDAVIT TO THE TRANSFEROR AND
THE TRUSTEE TO THE EFFECT THAT, AMONG OTHER THINGS, (A) IT IS NOT A
DISQUALIFIED ORGANIZATION, AS SUCH TERM IS DEFINED IN CODE SECTION 860E(e)(5),
OR AN AGENT (INCLUDING A BROKER, NOMINEE OR OTHER MIDDLEMAN) FOR SUCH
DISQUALIFIED ORGANIZATION AND IS OTHERWISE A PERMITTED TRANSFEREE (AS DEFINED
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN), (B) IT HAS
HISTORICALLY PAID ITS DEBTS AS THEY HAVE COME DUE AND INTENDS TO CONTINUE TO
PAY ITS DEBTS AS THEY COME DUE IN THE FUTURE, AND (C) IT INTENDS TO PAY ANY
TAXES ASSOCIATED WITH HOLDING THIS CERTIFICATE AS THEY BECOME DUE. ANY
PURPORTED TRANSFER TO A DISQUALIFIED ORGANIZATION OR OTHER PERSON THAT IS NOT A
PERMITTED TRANSFEREE OR OTHERWISE IN VIOLATION OF THESE RESTRICTIONS SHALL BE
ABSOLUTELY NULL AND VOID AND SHALL VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE.
IF THIS CERTIFICATE REPRESENTS A "NON-ECONOMIC RESIDUAL INTEREST," AS DEFINED
IN TREASURY REGULATIONS SECTION 1.860E-1(c), TRANSFERS OF THIS CERTIFICATE MAY
BE DISREGARDED FOR FEDERAL INCOME TAX PURPOSES. IN ORDER TO SATISFY A
REGULATORY SAFE HARBOR UNDER WHICH SUCH TRANSFERS WILL NOT BE DISREGARDED, THE
TRANSFEROR MAY BE REQUIRED, AMONG OTHER THINGS, TO SATISFY ITSELF AS TO THE
FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE.
THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE HEREOF, IS
DEEMED TO HAVE AGREED TO CONSENT TO ACT AS "TAX MATTERS PERSON" OF THE
UPPER-TIER REMIC AND TO THE APPOINTMENT OF THE TRUSTEE AS ATTORNEY-IN-FACT AND
AGENT FOR THE TAX MATTERS PERSON OR AS OTHERWISE PROVIDED IN THE POOLING AND
SERVICING AGREEMENT TO PERFORM THE FUNCTIONS OF A "TAX MATTERS PARTNER" FOR
PURPOSES OF SUBCHAPTER C OF CHAPTER 63 OF SUBTITLE F OF THE CODE.
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THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER THEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL INVESTOR
THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN
THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN ACCOUNT OR A PERSON
PURCHASING FOR THE ACCOUNT OF A QEB, WHOM THE HOLDER HAS INFORMED, IN EACH
CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A AND (B) IN ACCORDANCE WITH ANY OTHER APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED
BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975
OF THE CODE, OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW
WHICH IS TO A MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR
THE CODE (A "SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE COMPANY
THAT IS USING ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR GENERAL
ACCOUNT IN WHICH THE ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE DEEMED
PURSUANT TO ERISA OR ANY SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS), OR (C)
ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF ANY
SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE REQUIRED TO
DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE A
TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING THAT SUCH
PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B) OR (C)
ABOVE.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
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<PAGE> 322
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS R
CUSIP: 74436JDF1 Percentage Interest: 100%
This certifies that Prudential Securities Incorporated is the
registered owner of the Percentage Interest evidenced by this Certificate in
the Trust Fund. The Class R Certificateholder is not entitled to interest or
principal distributions. The Class R Certificateholder will be entitled to
receive the proceeds of the remaining assets of the Upper-Tier REMIC, if any,
on the Final Scheduled Distribution Date for the Certificates, after
distributions in respect of any accrued but unpaid interest on the Certificates
and after distributions in reduction of principal balance have reduced the
principal balances of the Certificates to zero. It is not anticipated that
there will be any assets remaining in the Upper-Tier REMIC, the Lower-Tier
REMIC or Trust Fund on the Final Scheduled Distribution Date following the
distributions on the Regular Certificates. The Trust Fund, described more
fully below, consists primarily of a pool of commercial Mortgage Loans secured
by first liens on commercial and multifamily properties and held in trust by
the Trustee and serviced by the Servicer. The Trust Fund was created, and the
Mortgage Loans are to be serviced, pursuant to the Pooling and Servicing
Agreement (as defined below). The Holder of this Certificate, by virtue of the
acceptance hereof, assents to the terms, provisions and conditions of the
Pooling and Servicing Agreement and is bound thereby. Also issued under the
Pooling and Servicing Agreement are the Class A-1, Class A-2, Class A-EC, Class
B, Class C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class J-2
and Class LR Certificates (together with the Class R Certificates, the
"Certificates"; the Holders of Certificates issued under the Pooling and
Servicing Agreement are collectively referred to herein as
"Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential
Securities Secured Financing Corporation, as depositor (the "Depositor"),
Midland Loan Services, L.P., as servicer (the "Servicer"), Lennar Partners,
Inc., as special servicer (the "Special Servicer"), LaSalle National Bank, as
trustee (the "Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the
Trustee (the "Fiscal Agent"). To the extent not defined herein, capitalized
terms used herein shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
This Certificate represents a "residual interest" in a
"real estate mortgage investment conduit," as those terms are defined,
respectively, in Sections 860G(a)(2) and 860D of the Internal Revenue Code of
1986, as amended (the "Code"). Each Holder of this Certificate, by
acceptance hereof, agrees to treat, and to take no action inconsistent with the
treatment of, this Certificate in accordance with the preceding sentence for
purposes of federal income taxes, state and local income and franchise taxes
and other taxes imposed on or measured by income.
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has
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executed this Certificate in its limited capacity as Trustee under the Pooling
and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month, or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the holders of this Certificate
as of the related Record Date, an amount equal to the product of the Percentage
Interest specified above and the amount, if any, required to be distributed to
holders of the Class R Certificates under the terms of the Pooling and
Servicing Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums as provided in the Pooling and Servicing Agreement.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of 100% Percentage Interest of
the Class R Certificates, or otherwise (b) by check mailed to such
Certificateholder. The final distribution on this Certificate shall be made in
like manner upon presentation and surrender of this Certificate at the location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Servicer to such Holders with respect to such amounts shall terminate, and
the Trustee shall thereafter hold such amounts for the benefit of such Holders.
No interest shall accrue or be payable to any Certificateholder on any amount
held as a result of such Certificateholder's failure to surrender its
Certificate(s) for final payment thereof in accordance with Section 9.1 of the
Pooling and Servicing Agreement. Such funds held by the Servicer may
A-13-4
<PAGE> 324
be invested under certain circumstances, and subject to certain conditions as
specified in the Pooling and Servicing Agreement.
This Certificate is limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registerable in the Certificate Register only upon surrender of this
Certificate for registration of transfer at the corporate trust office of the
Certificate Registrar or at the office of any transfer agent. The Certificate
Registrar shall require that this Certificate be duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing. Thereupon, one or more new Certificates
without coupons of a like aggregate Percentage Interest of the same Class in
authorized denominations will be executed by the Trustee or the Authenticating
Agent and authenticated by the Authenticating Agent and delivered by the
Certificate Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent, the Fiscal Agent and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all placing and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent, or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge will be made to a Certificateholder
for any such registration of transfer or exchange, other than (i) the expenses
of delivery by other than regular mail (if any) or (ii) if the Certificate
Registrar shall so require, payment of a sum sufficient to cover any stamp,
duty, tax or other governmental charge or insurance charges that may be imposed
in connection therewith. However, transferors of this Certificate are required
to cause to be delivered at their own expense any certificates, opinions, or
other documents (if any) as may be required to effect a transfer under the
Pooling and Servicing Agreement and may be
A-13-5
<PAGE> 325
required to reimburse the Trust for any costs of the Certificate Registrar's
review of the documents and any opinions of counsel in connection with a
transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66-2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
A-13-6
<PAGE> 326
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
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<PAGE> 327
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties acquired in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created
by the Pooling and Servicing Agreement continue beyond the expiration of 21
years from the death of the last surviving descendant(s) of Joseph P. Kennedy,
the late ambassador of the United States to the United Kingdom, living on the
date hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-13-8
<PAGE> 328
IN WITNESS WHEREOF, the Trustee has caused this Class R
Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:_________________________________________
Authorized Officer
Certificate of Authentication
This is the Class R Certificate referred to in the
Pooling and Servicing Agreement.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:_________________________________________
Authorized Officer
A-13-9
<PAGE> 329
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), and assign(s) and transfer(s) unto ____________________________________
________________________________________________________________________________
__________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class R Certificate and
hereby authorize(s) the registration of transfer of such interest to
Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class R
Certificate of the entire Percentage Interest represented by the within Class R
Certificates to the above-named Assignee(s) and to deliver such Class R
Certificate to the following address:
_______________________________________________________
_______________________________________________________
Date: _______________ ________________________________________
Signature by or on behalf of Assignor(s)
________________________________________
Taxpayer Identification Number
A-13-10
<PAGE> 330
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:__________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
_________ for the account of____________________________________________________
_________ account number______________________________________________.
This information is provided by ______________________________ the Assignee(s)
named above, or ___________________________________ as its (their) agent.
By:________________________________________
________________________________________
[Please print or type name(s)]
________________________________________
Title
________________________________________
Taxpayer Identification Number
A-13-11
<PAGE> 331
EXHIBIT A-14
THIS CLASS LR CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF
OR INTEREST IN THE DEPOSITOR, ANY ORIGINATOR, THE MORTGAGE LOAN SELLER, THE
SERVICER, THE SPECIAL SERVICER, THE TRUSTEE, THE FISCAL AGENT OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THE CERTIFICATES NOR THE UNDERLYING MORTGAGE
LOANS ARE INSURED OR GUARANTEED BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G(a)(2) AND 860D OF THE CODE.
A TRANSFEREE OF THIS CERTIFICATE, BY ACCEPTANCE HEREOF, IS DEEMED TO HAVE
ACCEPTED THIS CERTIFICATE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFERABILITY,
AS SET FORTH IN SECTION 5.2(j) OF THE POOLING AND SERVICING AGREEMENT, AND
SHALL BE REQUIRED TO FURNISH AN AFFIDAVIT TO THE TRANSFEROR AND THE TRUSTEE TO
THE EFFECT THAT, AMONG OTHER THINGS, (A) IT IS NOT A DISQUALIFIED ORGANIZATION,
AS SUCH TERM IS DEFINED IN CODE SECTION 860E(e)(5), OR AN AGENT (INCLUDING A
BROKER, NOMINEE OR OTHER MIDDLEMAN) FOR SUCH DISQUALIFIED ORGANIZATION AND IS
OTHERWISE A PERMITTED TRANSFEREE (AS DEFINED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, (B) IT HAS HISTORICALLY PAID ITS DEBTS AS THEY
HAVE COME DUE AND INTENDS TO CONTINUE TO PAY ITS DEBTS AS THEY COME DUE IN THE
FUTURE, AND (C) IT INTENDS TO PAY ANY TAXES ASSOCIATED WITH HOLDING THIS
CERTIFICATE AS THEY BECOME DUE. ANY PURPORTED TRANSFER TO A DISQUALIFIED
ORGANIZATION OR OTHER PERSON THAT IS NOT A PERMITTED TRANSFEREE OR OTHERWISE IN
VIOLATION OF THESE RESTRICTIONS SHALL BE ABSOLUTELY NULL AND VOID AND SHALL
VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE. IF THIS CERTIFICATE REPRESENTS A
"NON-ECONOMIC RESIDUAL INTEREST," AS DEFINED IN TREASURY REGULATIONS SECTION
1.860E-1(c), TRANSFERS OF THIS CERTIFICATE MAY BE DISREGARDED FOR FEDERAL
INCOME TAX PURPOSES. IN ORDER TO SATISFY A REGULATORY SAFE HARBOR UNDER WHICH
SUCH TRANSFERS WILL NOT BE DISREGARDED, THE TRANSFEROR MAY BE REQUIRED, AMONG
OTHER THINGS, TO SATISFY ITSELF AS TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE.
THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE HEREOF, IS
DEEMED TO HAVE AGREED TO CONSENT TO ACT AS "TAX MATTERS PERSON" OF THE
LOWER-TIER REMIC AND TO THE APPOINTMENT OF THE TRUSTEE AS ATTORNEY-IN-FACT AND
AGENT FOR THE TAX MATTERS PERSON OR AS OTHERWISE PROVIDED IN THE POOLING AND
SERVICING AGREEMENT TO PERFORM THE FUNCTIONS OF A "TAX MATTERS PARTNER" FOR
PURPOSES OF SUBCHAPTER C OF CHAPTER 63 OF SUBTITLE F OF THE CODE.
A-14-1
<PAGE> 332
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT AND OTHER APPLICABLE LAWS AND
ONLY (A) PURSUANT TO RULE 144A UNDER THE 1933 ACT TO AN INSTITUTIONAL INVESTOR
THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN
THE MEANING OF RULE 144A (A "QIB") PURCHASING FOR ITS OWN ACCOUNT OR A PERSON
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH
CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A AND (B) IN ACCORDANCE WITH ANY OTHER APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE PURCHASED
BY A TRANSFEREE THAT IS (A) AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, INCLUDING AN INDIVIDUAL RETIREMENT ACCOUNT OR A KEOGH PLAN, WHICH
IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975
OF THE CODE, OR A GOVERNMENT PLAN SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW
WHICH IS TO A MATERIAL EXTENT SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR
THE CODE (A "SIMILAR LAW") (EACH, A "PLAN"), OR (B) AN INSURANCE COMPANY
THAT IS USING ASSETS OF ANY INSURANCE COMPANY SEPARATE ACCOUNT OR GENERAL
ACCOUNT IN WHICH THE ASSETS OF SUCH PLAN ARE INVESTED (OR WHICH ARE DEEMED
PURSUANT TO ERISA OR ANY SIMILAR LAW TO INCLUDE ASSETS OF SUCH PLANS), OR (C)
ANY OTHER PERSON ACTING ON BEHALF OF ANY SUCH PLAN OR USING THE ASSETS OF ANY
SUCH PLAN. EACH PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE WILL BE REQUIRED TO
DELIVER TO THE DEPOSITOR, THE CERTIFICATE REGISTRAR AND THE TRUSTEE A
TRANSFEREE REPRESENTATION LETTER, SUBSTANTIALLY IN THE FORM OF EXHIBIT D-2 TO
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN, STATING THAT SUCH
PROSPECTIVE TRANSFEREE IS NOT A PERSON REFERRED TO IN CLAUSE (A), (B) OR (C)
ABOVE.
ANY HOLDER DESIRING TO EFFECT A TRANSFER OF THIS CERTIFICATE
SHALL, AND DOES HEREBY AGREE TO, INDEMNIFY THE CERTIFICATE REGISTRAR, THE
TRUSTEE, THE SERVICER AND THE DEPOSITOR AGAINST ANY LIABILITY THAT MAY RESULT
IF THE TRANSFER IS NOT EXEMPT FROM THE 1933 ACT OR IS NOT MADE IN ACCORDANCE
WITH FEDERAL AND STATE LAWS.
A-14-2
<PAGE> 333
EXHIBIT A-14
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1995-MCF-2, CLASS LR
CUSIP: 74436JDG9 Percentage Interest: 100%
This certifies that Prudential Securities Incorporated is the
registered owner of the Percentage Interest evidenced by this Certificate in
the Trust Fund. The Class LR Certificateholder is not entitled to interest or
principal distributions. The Class LR Certificateholder will be entitled to
receive the proceeds of the remaining assets of the Lower-Tier REMIC, if any,
on the Final Scheduled Distribution Date for the Certificates, after
distributions in respect of any accrued but unpaid interest on the Certificates
and after distributions in reduction of principal balance have reduced the
principal balances of the Certificates to zero. It is not anticipated that
there will be any assets remaining in the Upper-Tier REMIC, the Lower-Tier
REMIC or the Trust Fund on the Final Scheduled Distribution Date following the
distributions on the Regular Certificates. The Trust Fund, described more
fully below, consists primarily of a pool of commercial Mortgage Loans secured
by first liens on commercial and multifamily properties and held in trust by
the Trustee and serviced by the Servicer. The Trust Fund was created, and the
Mortgage Loans are to be serviced, pursuant to the Pooling and Servicing
Agreement (as defined below). The Holder of this Certificate, by virtue of the
acceptance hereof, assents to the terms, provisions and conditions of the
Pooling and Servicing Agreement and is bound thereby. Also issued under the
Pooling and Servicing Agreement are the Class A-1, Class A-2, Class A-EC, Class
C, Class D, Class E, Class F, Class G, Class H, Class J-1, Class J-2 and Class
R Certificates (together with the Class LR Certificates, the "Certificates";
the Holders of Certificates issued under the Pooling and Servicing Agreement
are collectively referred to herein as "Certificateholders").
This Certificate is issued pursuant to, and in accordance
with, the terms of a Pooling and Servicing Agreement, dated as of December 1,
1995 (the "Pooling and Servicing Agreement"), by and among Prudential
Securities Secured Financing Corporation, as depositor (the "Depositor"),
Midland Loan Services, L.P., as servicer (the "Servicer"), Lennar Partners,
Inc., as special servicer (the "Special Servicer"), LaSalle National Bank, as
trustee (the "Trustee"), and ABN AMRO Bank N.V., as fiscal agent for the
Trustee (the "Fiscal Agent"). To the extent not defined herein, capitalized
terms used herein shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
This Certificate represents a "residual interest" in a
"real estate mortgage investment conduit," as those terms are defined,
respectively, in Sections 860G(a)(2) and 860D of the Internal Revenue Code of
1986, as amended (the "Code"). Each Holder of this Certificate, by
acceptance hereof, agrees to treat, and to take no action inconsistent with the
treatment of, this Certificate in accordance with the preceding sentence for
purposes of federal income taxes, state and local income and franchise taxes
and other taxes imposed on or measured by income.
A-14-3
<PAGE> 334
The Trustee makes no representation or warranty as to any of
the statements contained herein or the validity or sufficiency of the
Certificates or the Mortgage Loans and has executed this Certificate in its
limited capacity as Trustee under the Pooling and Servicing Agreement.
Pursuant to the terms of the Pooling and Servicing Agreement,
the Trustee, or the Paying Agent on behalf of the Trustee, will distribute
(other than the final distribution on any Certificate), on the twenty-fifth day
of each month or if such twenty-fifth day is not a Business Day, the Business
Day immediately following such twenty-fifth day, commencing in January 1996
(each such date, a "Distribution Date"), to the holders of this Certificate
as of the related Record Date, an amount equal to the product of the Percentage
Interest specified above and the amount, if any, required to be distributed to
holders of the Class LR Certificates under the terms of the Pooling and
Servicing Agreement. Holders of this Certificate may be entitled to Prepayment
Premiums as provided in the Pooling and Servicing Agreement.
All distributions (other than the final distribution on any
Certificate) will be made by the Paying Agent to the persons in whose names the
Certificates are registered at the close of business on each Record Date, which
will be the last Business Day of the month immediately preceding the month in
which the related Distribution Date occurs. Such distributions will be made
(a) by wire transfer in immediately available funds to the account specified by
the Certificateholder at a bank or other entity located in the United States
having appropriate facilities therefor, if such Certificateholder provides the
Trustee with wiring instructions no less than five Business Days prior to the
related Record Date and is the registered owner of 100% Percentage Interest of
the Class LR Certificates, or otherwise (b) by check mailed to such
Certificateholder. The final distribution on this Certificate shall be made in
like manner upon presentation and surrender of this Certificate at the location
specified in the notice to Certificateholders of such final distribution.
Any funds not distributed on the Termination Date because of
failure of Certificateholders to tender their Certificates shall be set aside
and held in trust for the account of the non-tendering Certificateholders,
whereupon the Trust Fund shall terminate. If any Certificates as to which
notice of the Termination Date has been given pursuant to Section 9.1 of the
Pooling and Servicing Agreement shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Servicer shall mail a second notice to the remaining Certificateholders, at
their last addresses shown in the Certificate Register, to surrender their
Certificates for cancellation in order to receive, from such funds held, the
final distribution with respect thereto. If within one year after the second
notice any Certificate shall not have been surrendered for cancellation, the
Servicer may, directly or through an agent, take appropriate steps to contact
the remaining Certificateholders concerning surrender of their Certificates.
The costs and expenses of maintaining such funds and of contacting
Certificateholders shall be paid out of the assets which remain held. If
within two years after the second notice any Certificates shall not have been
surrendered for cancellation, the Paying Agent shall pay to the Servicer all
amounts distributable to the Holders thereof, at which time the obligations of
the Servicer to such Holders with respect to such amounts shall terminate, and
the Trustee shall thereafter hold such amounts for the benefit of such Holders.
No interest shall accrue or be payable to any Certificateholder on any amount
held as a result of such
A-14-4
<PAGE> 335
Certificateholder's failure to surrender its Certificate(s) for final payment
thereof in accordance with Section 9.1 of the Pooling and Servicing Agreement.
Such funds held by the Trustee may be invested under certain circumstances, and
subject to certain conditions as specified in the Pooling and Servicing
Agreement.
The Certificates are limited in right of payment to, among
other things, certain collections and recoveries in respect of the Mortgage
Loans, as more specifically set forth herein and in the Pooling and Servicing
Agreement.
As provided in the Pooling and Servicing Agreement, the
Collection Account and the Distribution Account will be held in the name of the
Trustee on behalf of the holders of Certificates specified in the Pooling and
Servicing Agreement and the Servicer or the Paying Agent will be authorized to
make withdrawals therefrom. Amounts on deposit in such accounts may be
invested in Permitted Investments. Interest or other income earned on funds in
the Collection Account and the Distribution Account will be paid to the
Servicer or the Depositor as set forth in the Pooling and Servicing Agreement.
This Certificate does not purport to summarize the Pooling and
Servicing Agreement, and reference is made to the Pooling and Servicing
Agreement for the interests, rights, benefits, obligations and duties evidenced
hereby, and the limitations thereon, and the rights, duties and immunities of
the Trustee.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registrable in the Certificate Register only upon surrender of this Certificate
for registration of transfer at the corporate trust office of the Certificate
Registrar or at the office of any transfer agent. The Certificate Registrar
shall require that this Certificate be duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing. Thereupon, one or more new Certificates without coupons
of a like aggregate Percentage Interest of the same Class in authorized
denominations will be executed by the Trustee or the Authenticating Agent and
authenticated by the Authenticating Agent and delivered by the Certificate
Registrar to the designated transferee or transferees.
Prior to due presentation of this Certificate for registration
of transfer, the Depositor, the Servicer, the Trustee, the Certificate
Registrar, any Paying Agent,the Fiscal Agent, and any agent of any of them may
treat the Person in whose name this Certificate is registered as the owner
hereof for all purposes, and none of the Depositor, the Servicer, the Trustee,
the Certificate Registrar, any Paying Agent, the Fiscal Agent, or any agent of
any of them shall be affected by notice to the contrary.
No fee or service charge will be made to a Certificateholder
for any such registration of transfer or exchange, other than (i) the expenses
of delivery by other than regular mail (if any) or (ii) if the Certificate
Registrar shall so require, payment of a sum sufficient to cover any stamp,
duty, tax or other governmental charge or insurance charges that may be imposed
in connection therewith. However, transferors of this Certificate are required
to cause
A-14-5
<PAGE> 336
to be delivered at their own expense any certificates, opinions, or other
documents (if any) as may be required to effect a transfer under the Pooling
and Servicing Agreement and may be required to reimburse the Trust for any
costs of the Certificate Registrar's review of the documents and any opinions
of counsel in connection with a transfer.
The Pooling and Servicing Agreement or any Custodial Agreement
may be amended from time to time by the Depositor, the Servicer, the Special
Servicer, the Trustee and the Fiscal Agent, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement
any provisions therein that may be inconsistent with any other provisions
therein, (iii) to amend any provision thereof to the extent necessary or
desirable to maintain the rating or ratings assigned to each of the Classes of
Regular Certificates by each Rating Agency, or (iv) to make any other
provisions with respect to matters or questions arising under the Pooling and
Servicing Agreement, which shall not be inconsistent with the provisions of the
Pooling and Servicing Agreement and will not result in the downgrading,
withdrawal or qualification of the rating or ratings then assigned to any
outstanding Class of Certificates, as confirmed by each Rating Agency in
writing and, which, as evidenced by an Opinion of Counsel at the expense of the
party (other than the Trustee, unless such amendment modifies or otherwise
relates solely to the obligations, duties or rights of the Trustee) requesting
such amendment, shall not adversely affect in any material respect the
interests of any Certificateholder.
The Pooling and Servicing Agreement may also be amended from
time to time by the Depositor, the Servicer, the Special Servicer, the Trustee
and the Fiscal Agent with the consent of the Holders of each of the Classes of
Regular Certificates representing not less than 66-2/3% of the aggregate Voting
Rights allocated to each Class of Certificates affected by the amendment for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Pooling and Servicing Agreement or of
modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall: (i) reduce in any manner the amount of,
or delay the timing of, payments received on Mortgage Loans which are required
to be distributed on any Certificate without the consent of each affected
Certificateholder; (ii) change the percentages of Voting Rights of Holders of
Certificates which are required to consent to any action or inaction under the
Pooling and Servicing Agreement, without the consent of the Holders of all
Certificates then outstanding; or (ii) alter the servicing standard set forth
in the Pooling and Servicing Agreement or the obligations of the Servicer, the
Trustee or the Fiscal Agent to make a P&I Advance or Property Advance without
the consent of the Holders of all Certificates representing all of the Voting
Rights of the Class or Classes affected thereby.
Further, the Depositor, the Servicer, the Special Servicer,
the Trustee and the Fiscal Agent, at any time and from time to time, without
the consent of the Certificateholders, may amend the Pooling and Servicing
Agreement to modify, eliminate or add to any of its provisions to such extent
as shall be necessary to maintain the qualification of the Trust REMICs as two
separate REMICs, or to prevent the imposition of any additional material state
or local taxes, at all times that any Certificates are outstanding; provided,
however, that such action, as evidenced by an opinion of counsel, is necessary
or helpful to maintain such qualification or to prevent the imposition of any
such taxes, and would not adversely affect in any material respect the interest
of any Certificateholder.
A-14-6
<PAGE> 337
No amendment shall cause either the Upper-Tier REMIC or
Lower-Tier REMIC to fail to qualify as a REMIC, as evidenced by an opinion of
counsel.
The Special Servicer, the Servicer, the Depositor and the
Holders of the Class LR Certificates representing greater than a 50% Percentage
Interest of the Class LR Certificates will have the option, upon 30 days' prior
Notice of Termination given to the Trustee and the Servicer, which notice the
Trustee is required to forward to Certificateholders in the manner set forth in
the Pooling and Servicing Agreement, to purchase all of the Mortgage Loans and
all property acquired in respect of any Mortgage Loan remaining in the Trust
Fund, and thereby effect termination of the Trust Fund and early retirement of
the then outstanding Certificates, on any Distribution Date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans remaining in the
Trust Fund is less than 10% of the aggregate Scheduled Principal Balance of the
Mortgage Loans as of the Cut-off Date.
If the Trust Fund has not been previously terminated pursuant
to the preceding paragraph the Trustee shall conduct an auction of the Mortgage
Loans in accordance with the following principles:
(i) On the third Distribution Date preceding the
Distribution Date occurring in December 2006 (or a
later Distribution Date determined by the Trustee)
the Trustee shall solicit quotes from four
Independent broker-dealer firms for bids for whole
loans, and if the aggregate fair market value of the
Mortgage Loans and all other property acquired in
respect of any Mortgage Loan in the Trust Fund, as
determined by the average of the three highest such
quotes, equals or exceeds the aggregate amount of the
Certificate Balances of all Certificates expected to
be outstanding as of the close of business on the
Auction Proceeds Distribution Date (such aggregate
amount, the "Aggregate Certificate Balance") as
well as auction expenses, the Trustee shall appoint
an Auction Agent to solicit offers from Qualified
Offerors to purchase all (but not less than all) of
the Mortgage Loans.
(ii) The Trustee shall reject every bid (a) that is from a
Person who has not been qualified to bid for the
Mortgage Loans, (b) that provides for a purchase
price that is less than the Aggregate Certificate
Balance, (c) that provides for purchase on terms
other than all-cash or (d) that is contingent on the
occurrence or non-occurrence of any event (each, a
"Deficient Auction Bid"). If all bids received by
the Trustee are Deficient Auction Bids, the Mortgage
Loans shall not be sold and there shall be no
termination of the Trust Fund pursuant to Section
9.1(d).
(iii) The Trustee is required to accept the highest bid
that is not a Deficient Auction Bid and to sell the
Mortgage Loans to the successful bidder at a closing
to be held no later than the Remittance Date
immediately preceding the Distribution Date occurring
in December 2006 (or a later Distribution Date
determined by the Trustee).
A-14-7
<PAGE> 338
The obligations created by the Pooling and Servicing Agreement
shall terminate upon the earliest to occur of (i) the purchase of the Mortgage
Loans and properties required in respect thereof by the Servicer, the Special
Servicer, the Depositor or the Holders of the Class LR Certificates as
described above; (ii) the later of (a) the distribution to Certificateholders
of final payment with respect to the Mortgage Loans or (b) the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure with
respect to the Mortgage Loans and the remittance to the Certificateholders of
all funds due under the Pooling and Servicing Agreement; or (iii) the sale of
assets of the Trust Fund after the Certificate Balances or Notional Balances,
as applicable, of all the Certificates (other than the Class R and Class LR
Certificates) have been reduced to zero under circumstances set forth in the
Pooling and Servicing Agreement. In no event, however, will the trust created
by the Pooling and Servicing Agreement continue beyond the expiration of 21
years from the death of the last surviving descendant(s) of Joseph P. Kennedy,
the late ambassador of the United States to the United Kingdom, living on the
date hereof.
Unless the Certificate of Authentication on this Certificate
has been executed by the Trustee or on its behalf by the Authenticating Agent,
by manual signature, this Certificate shall not be entitled to any benefit
under the Pooling and Servicing Agreement or be valid for any purpose.
[SIGNATURES COMMENCE ON FOLLOWING PAGE]
A-14-8
<PAGE> 339
IN WITNESS WHEREOF, the Trustee has caused this Class LR
Certificate to be duly executed.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Trustee
By:_________________________________________
Authorized Officer
Certificate of Authentication
This is the Class LR Certificate referred to in the Pooling and
Servicing Agreement.
Dated: _______________
LASALLE NATIONAL BANK, not in its individual
capacity but solely as Authenticating Agent
By:_________________________________________
Authorized Officer
A-14-9
<PAGE> 340
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned ("Assignor(s)") hereby
sell(s), assign(s) and transfer(s) unto ________________________________________
________________________________________________________________________________
__________________________________ (please print or typewrite name(s) and
address(es), including postal zip code(s) of assignee(s)) ("Assignee(s)") the
entire Percentage Interest represented by the within Class LR Certificate and
hereby authorize(s) the registration of transfer of such interest to
Assignee(s) on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Class LR
Certificate of the entire Percentage Interest represented by the within Class
LR Certificates to the above-named Assignee(s) and to deliver such Class LR
Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Date: _______________ __________________________________________
Signature by or on behalf of Assignor(s)
__________________________________________
Taxpayer Identification Number
A-14-10
<PAGE> 341
DISTRIBUTION INSTRUCTIONS
The Assignee(s) should include the following for purposes of
distribution:
Address of the Assignee(s) for the purpose of receiving notices and
distributions:__________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Distributions, if be made by wire transfer in immediately available funds to
________________________________________________________________________________
_________ for the account of ___________________________________________________
_________ account number _____________________________________________.
This information is provided by ______________________________
the Assignee(s) named above, or _____________________________________________
as its (their) agent.
By:________________________________________
________________________________________
[Please print or type name(s)]
________________________________________
Title
________________________________________
Taxpayer Identification Number
A-14-11
<PAGE> 342
EXHIBIT B: MORTGAGE LOAN SCHEDULE
PART I
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
ORIGINAL
LOAN MIDLAND ASSET MONTHLY INTEREST AMORT.
ID # NUMBER PROPERTY NAME LOCATION PAYMENT RATE DEFAULT RATE MATURITY DATE (MONTHS)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
28 940900683 Seaport Manor(**) Brooklyn, NY $27,502 9.55% A 12/1/14 234
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
LOAN MIDLAND ASSET CUT-OFF DATE UNDERWRITTEN UNDERWRITTEN UNDERWRITTEN
ID # NUMBER PROPERTY NAME BALANCE NCF DSCR LTV
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
28 940900683 Seaport Manor(**) $2,888,661 $904,374 1.35 31.94%
- ---------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
PREPAY
NON-PREMIUM LOCKOUT PREMIUM % PREMIUM TOTAL
LOAN MIDLAND ASSET PREPAYMENTS PERIOD YM PERIOD DURING YM AFTER YM PREMIUM
ID # NUMBER PROPERTY MANAGER PERMITTED (YEARS) (YEARS) PERIOD PERIOD PERIOD
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
28 940900683 Self Managed FALSE 0 10 5.00% 5%,4%,3%,2%,1% 15
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------------
LOAN # CROSS
LOAN MIDLAND ASSET MAXIMUM COLLATERALIZED SECURED PROPERY
ID # NUMBER PROPERTY MANAGER SERVICING RATE WITH INTEREST TYPE ORIGINATOR
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
28 940900683 Self Managed 0.25% Fee Simple Congregate Care MCF
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
** Seaport Manor had a total original loan amount of $5.915 million but has a
participation in this pool of only $2.915 million, with a cut-off date balance
of $2,888,661. Another series of the Depositor's commercial mortgage
pass-through certificates (the PSSFC 1995-C1 series) contained the remainder of
the total loan amount.
Default Rate Code Description
A The greater of (a) 4% above the stated interest rate on the Mortgage Loan
and (b) 4% above the prime rate reported in The Wall Street Journal.
B The lesser of (a) 150% of the stated interest rate on the Mortgage Loan and
(b) the highest rate permitted by law.
C The lesser of (a) 13.86% or (b) the maximum rate allowed under applicable
law.
D The lesser of (a) 13.48% or (b) the maximum rate allowed under applicable
law.
E A rate equal to 5% above the stated interest rate on the Mortgage Loan.
F The lesser of (a) 21% per annum or (b) the greater of (i) 4% above the
applicable interest rate on the Mortgage Loan or (ii) 4% above the Prime
Rate reported in The Wall Street Journal.
EXHIBIT B
PART I - 1
<PAGE> 343
EXHIBIT B: MORTGAGE LOAN SCHEDULE
PART II
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
MIDLAND
LOAN ID ASSET MONTHLY INTEREST DEFAULT MATURITY
# NUMBER PROPERTY NAME LOCATION PAYMENT RATE RATE DATE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 940903231 Star Markets - Cambridge Cambridge, MA $66,932 8.59% A 1/1/11
2 940903232 Star Markets - Quincy Quincy, MA $65,844 8.59% A 1/1/11
3 940903262 3307 M Street NW Washington, DC $65,395 8.75% B 11/1/15
4 940902784 Ceasar Figoni Properties East Patchogue, NY $55,064 8.35% E 11/1/05
5 940901028 2982 Grand Avenue Coconut Grove, FL $48,968 8.51% A 12/1/05
- ---------------------------------------------------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor Chattanooga, TN $50,513 8.08% A 11/1/02
7 940902450 Gottschalks - Palmdale Palmdale, CA $52,613 9.39% A 10/1/10
8 940902526 Garden Ridge Mesquite, TX $52,720 8.05% A 1/1/03
9 940902047 Mack Park Apartments Denton, TX $40,903 7.89% A 12/1/02
10 940902259 Park Villa Apartments Tulsa, OK $36,347 7.90% A 12/1/00
- ---------------------------------------------------------------------------------------------------------------------------
11 940902096 Spruce Financial Center Riverside, CA $36,448 8.57% A 1/1/08
12 940902453 Gottschalks - Yuba City Yuba City, CA $38,713 9.39% A 10/1/10
13 940903276 Hydronautics Facility Oceanside, CA $40,049 8.20% B 11/1/12
14 940902452 Gottschalks - Eureka Eureka, CA $37,235 9.23% A 11/1/10
15 940903265 BJ's Wholesale Club Johnson, RI $34,511 8.42% B 11/1/11
- ---------------------------------------------------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center Houston, TX $32,117 8.77% A 12/1/07
17 940900420 Riverdale Shopping Center Little Rock, AR $34,140 9.24% A 9/1/10
18 940901138 Lafourche Plaza Shopping Ctr Thibodaux, LA $34,301 8.65% F 12/1/05
19 940902205 The Bristol House Gracious Retirement Living Bristol, VA $29,022 8.20% A 11/1/02
20 940901210 Westwood Center II Bethesda, MD $30,063 8.94% A 10/1/05
- ---------------------------------------------------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less Corona, CA $27,119 8.30% A 11/1/10
22 940902048 Kingswood Apartments Denton, TX $25,612 7.89% A 12/1/02
23 940902139 Kash N' Karry Store # 725 Ocala, FL $28,334 9.57% A 8/1/10
24 940902140 Kash N' Karry Store # 733 Auburndale, FL $28,070 9.57% A 8/1/10
25 940901753 Kash N' Karry Store # 720 Gainesville, FL $26,686 9.57% A 8/1/10
- ---------------------------------------------------------------------------------------------------------------------------
26 940900748 Comfort Inn Kingsport, TN $28,812 9.93% A 6/1/10
27 940901739 Rialto Food-4-Less Rialto, CA $23,976 8.64% A 10/1/10
29 940901999 Food 4 Less Supermarket Lincoln, NE $23,858 8.25% A 12/1/05
30 940901132 McPherron Properties St. Louis Area, MO $23,767 9.14% A 10/1/05
31 940900880 Lost River Apartments Bowling Green, KY $24,578 9.10% A 9/1/10
- ---------------------------------------------------------------------------------------------------------------------------
32 940903264 Leparc Apartments Staten Island, NY $22,640 8.99% D 12/1/05
33 940900719 Live Oaks Center Casselberry, FL $22,769 9.06% A 10/1/07
34 940901277 Union Plaza Office Building Minneapolis, MN $22,933 9.62% A 9/1/10
35 940901885 Frank's Nursery & Crafts Stores Various, MI $22,145 8.31% A 11/1/05
36 940901616 Santa Monica Plaza Los Angeles, CA $20,520 8.73% A 12/1/07
- ---------------------------------------------------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center Minnetonka, MN $20,719 9.35% A 9/6/07
38 940901358 Meadowbrook Mobile Home Park Pueblo County, CO $20,198 8.31% A 12/1/02
39 940902485 University Village Apartments Kansas City, KS $18,728 8.90% A 12/1/02
40 940903261 Univax Building Rockville, MD $23,767 9.70% B 11/1/10
41 940900945 Parkway Place Vadnais Heights, MN $18,583 9.08% A 10/1/07
- ---------------------------------------------------------------------------------------------------------------------------
42 940901039 Town Center Harrisonburg, VA $18,166 9.17% A 10/1/05
43 940900904 Fairmount Centre Geddes, NY $18,055 9.08% A 8/1/05
44 940901567 Mason Creek Center Katy, TX $16,994 9.00% A 11/1/07
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
MIDLAND ORIGINAL UNDER UNDER
LOAN ID ASSET AMORTIZ. CUT-OFF UNDERWRITTEN WRITTEN WRITTEN
# NUMBER PROPERTY NAME (MONTHS) DATE BALANCE NCF DSCR LTV
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1 940903231 Star Markets - Cambridge 300 $8,250,000 $1,210,640 1.51 67.76%
2 940903232 Star Markets - Quincy 300 $8,115,800 $1,074,558 1.36 78.20%
3 940903262 3307 M Street NW 240 $7,388,563 $ 985,789 1.26 70.54%
4 940902784 Ceasar Figoni Properties 300 $6,737,984 $1,016,685 1.54 70.15%
5 940901028 2982 Grand Avenue 420 $6,550,000 $ 848,699 1.44 74.96%
- ------------------------------------------------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor 300 $6,493,254 $ 965,795 1.59 70.59%
7 940902450 Gottschalks - Palmdale 300 $6,064,807 $ 832,831 1.32 66.79%
8 940902526 Garden Ridge 180 $5,500,000 $ 773,984 1.22 71.06%
9 940902047 Mack Park Apartments 300 $5,350,000 $ 680,545 1.39 74.68%
10 940902259 Park Villa Apartments 300 $4,750,000 $ 573,776 1.32 74.51%
- ------------------------------------------------------------------------------------------------------------------------
11 940902096 Spruce Financial Center 300 $4,500,000 $ 572,471 1.31 72.92%
12 940902453 Gottschalks - Yuba City 300 $4,462,500 $ 631,448 1.36 64.83%
13 940903276 Hydronautics Facility 204 $4,390,017 $ 624,354 1.30 73.83%
14 940902452 Gottschalks - Eureka 300 $4,351,262 $ 618,716 1.38 64.51%
15 940903265 BJ's Wholesale Club 240 $4,000,000 $ 533,952 1.29 71.17%
- ------------------------------------------------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center 300 $3,900,000 $ 502,838 1.30 75.49%
17 940900420 Riverdale Shopping Center 276 $3,887,575 $ 599,122 1.46 65.64%
18 940901138 Lafourche Plaza Shopping Ctr 216 $3,750,000 $ 504,730 1.23 74.70%
19 940902205 The Bristol House Gracious Retirement Living 300 $3,692,738 $ 535,379 1.54 72.42%
20 940901210 Westwood Center II 300 $3,593,489 $ 492,756 1.37 74.47%
- ------------------------------------------------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less 300 $3,421,571 $ 464,345 1.43 73.69%
22 940902048 Kingswood Apartments 300 $3,350,000 $ 431,173 1.40 73.81%
23 940902139 Kash N' Karry Store # 725 300 $3,217,094 $ 408,161 1.20 74.82%
24 940902140 Kash N' Karry Store # 733 300 $3,187,168 $ 404,951 1.20 74.82%
25 940901753 Kash N' Karry Store # 720 300 $3,030,054 $ 384,786 1.20 74.82%
- ------------------------------------------------------------------------------------------------------------------------
26 940900748 Comfort Inn 240 $2,975,580 $ 539,140 1.56 65.58%
27 940901739 Rialto Food-4-Less 300 $2,937,407 $ 399,389 1.39 73.55%
29 940901999 Food 4 Less Supermarket 240 $2,800,000 $ 364,382 1.27 74.92%
30 940901132 McPherron Properties 300 $2,795,102 $ 396,123 1.39 72.33%
31 940900880 Lost River Apartments 264 $2,789,889 $ 394,228 1.34 74.31%
- ------------------------------------------------------------------------------------------------------------------------
32 940903264 Leparc Apartments 300 $2,700,000 $ 330,879 1.22 75.48%
33 940900719 Live Oaks Center 300 $2,695,213 $ 358,100 1.31 72.71%
34 940901277 Union Plaza Office Building 300 $2,593,679 $ 349,692 1.27 74.80%
35 940901885 Frank's Nursery & Crafts Stores 240 $2,583,274 $ 354,787 1.34 74.88%
36 940901616 Santa Monica Plaza 300 $2,500,000 $ 339,725 1.38 74.76%
- ------------------------------------------------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center 300 $2,393,896 $ 342,084 1.38 74.58%
38 940901358 Meadowbrook Mobile Home Park 240 $2,360,000 $ 347,126 1.43 67.99%
39 940902485 University Village Apartments 300 $2,250,000 $ 270,970 1.21 74.73%
40 940903261 Univax Building 180 $2,244,420 $ 402,805 1.41 66.58%
41 940900945 Parkway Place 300 $2,196,113 $ 294,584 1.32 73.87%
- ------------------------------------------------------------------------------------------------------------------------
42 940901039 Town Center 300 $2,131,284 $ 293,231 1.35 72.00%
</TABLE>
<PAGE> 344
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
43 940900904 Fairmount Centre 300 $2,129,889 $ 291,768 1.35 74.63%
44 940901567 Mason Creek Center 300 $2,023,194 $ 283,836 1.39 72.29%
- ------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
MIDLAND NON-PREMIUM
LOAN ID ASSET PREPAYMENTS
# NUMBER PROPERTY NAME PROPERTY MANAGER PERMITTED
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 940903231 Star Markets - Cambridge Self Managed FALSE
2 940903232 Star Markets - Quincy Self Managed FALSE
3 940903262 3307 M Street NW Harvey Property Mgmnt Corp. FALSE
4 940902784 Ceasar Figoni Properties Self Managed FALSE
5 940901028 2982 Grand Avenue Self Managed FALSE
- --------------------------------------------------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor Leasure Centers, Inc. FALSE
7 940902450 Gottschalks - Palmdale Self Managed FALSE
8 940902526 Garden Ridge Self Managed - Butler Real Estate FALSE
9 940902047 Mack Park Apartments Wells Asset Management FALSE
10 940902259 Park Villa Apartments Self Managed FALSE
- --------------------------------------------------------------------------------------------------------------------------
11 940902096 Spruce Financial Center Magnon Companies FALSE
12 940902453 Gottschalks - Yuba City Self Managed FALSE
13 940903276 Hydronautics Facility Sierra Capital FALSE
14 940902452 Gottschalks - Eureka Self Managed FALSE
15 940903265 BJ's Wholesale Club Self Managed FALSE
- --------------------------------------------------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center Self Managed FALSE
17 940900420 Riverdale Shopping Center Flake, Tabor, Tucker, Wells & Kelley FALSE
18 940901138 Lafourche Plaza Shopping Ctr Brandywine Mgmnt FALSE
19 940902205 The Bristol House Gracious Retirement Living Leasure Centers, Inc. FALSE
20 940901210 Westwood Center II Westwood Mgmnt FALSE
- --------------------------------------------------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less The Vista Group FALSE
22 940902048 Kingswood Apartments Wells Asset Mgmnt FALSE
23 940902139 Kash N' Karry Store # 725 Owner occupied FALSE
24 940902140 Kash N' Karry Store # 733 Owner occupied FALSE
25 940901753 Kash N' Karry Store # 720 Owner occupied FALSE
- --------------------------------------------------------------------------------------------------------------------------
26 940900748 Comfort Inn Horizons Hotels Ltd. FALSE
27 940901739 Rialto Food-4-Less The Vista Group FALSE
29 940901999 Food 4 Less Supermarket Intervest Properties FALSE
30 940901132 McPherron Properties Roberts Realty (on site mgrs) FALSE
31 940900880 Lost River Apartments American Mgmnt Serv. FALSE
- --------------------------------------------------------------------------------------------------------------------------
32 940903264 Leparc Apartments Samson Mgmnt Company FALSE
33 940900719 Live Oaks Center Kellogg Properties Inc. FALSE
34 940901277 Union Plaza Office Building Investment Mgmnt FALSE
35 940901885 Frank's Nursery & Crafts Stores Self Managed FALSE
36 940901616 Santa Monica Plaza Self Managed FALSE
- --------------------------------------------------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center Park Commercial FALSE
38 940901358 Meadowbrook Mobile Home Park Affordable Residential Communities FALSE
39 940902485 University Village Apartments J & B Mgmnt FALSE
40 940903261 Univax Building Greenhoot Inc. & Brannock Real Estate, Inc. FALSE
41 940900945 Parkway Place Wellington Mgmnt Inc. FALSE
- --------------------------------------------------------------------------------------------------------------------------
42 940901039 Town Center Self Managed FALSE
43 940900904 Fairmount Centre Norman Swanson Real Estate FALSE
44 940901567 Mason Creek Center Unilev Mgmnt FALSE
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------
MIDLAND LOCKOUT YM
LOAN ID ASSET PERIOD PERIOD
# NUMBER PROPERTY NAME (YEARS) (YEARS)
- ----------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1 940903231 Star Markets - Cambridge 0 10
2 940903232 Star Markets - Quincy 0 10
3 940903262 3307 M Street NW 5 14.75
4 940902784 Ceasar Figoni Properties 2 9
5 940901028 2982 Grand Avenue 0 3
- ----------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor 0 6
7 940902450 Gottschalks - Palmdale 0 10
8 940902526 Garden Ridge 0 5
9 940902047 Mack Park Apartments 0 5
10 940902259 Park Villa Apartments 0 4
- ----------------------------------------------------------------------------------
11 940902096 Spruce Financial Center 0 8
12 940902453 Gottschalks - Yuba City 0 10
13 940903276 Hydronautics Facility 4 13
14 940902452 Gottschalks - Eureka 0 10
15 940903265 BJ's Wholesale Club 5 10.75
- ----------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center 0 4
17 940900420 Riverdale Shopping Center 0 10
18 940901138 Lafourche Plaza Shopping Ctr 0 3
19 940902205 The Bristol House Gracious Retirement Living 0 6
20 940901210 Westwood Center II 0 3
- ----------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less 0 10
22 940902048 Kingswood Apartments 0 5
23 940902139 Kash N' Karry Store # 725 0 10
24 940902140 Kash N' Karry Store # 733 0 10
25 940901753 Kash N' Karry Store # 720 0 10
- ----------------------------------------------------------------------------------
26 940900748 Comfort Inn 0 0
27 940901739 Rialto Food-4-Less 0 10
29 940901999 Food 4 Less Supermarket 0 3
30 940901132 McPherron Properties 0 3
31 940900880 Lost River Apartments 0 5
- ----------------------------------------------------------------------------------
</TABLE>
<PAGE> 345
<TABLE>
<S> <C> <C> <C> <C>
32 940903264 Leparc Apartments 5 0
33 940900719 Live Oaks Center 0 4
34 940901277 Union Plaza Office Building 0 5
35 940901885 Frank's Nursery & Crafts Stores 0 9.5
36 940901616 Santa Monica Plaza 0 12
- ----------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center 0 4
38 940901358 Meadowbrook Mobile Home Park 0 2
39 940902485 University Village Apartments 0 6
40 940903261 Univax Building 5 10
41 940900945 Parkway Place 0 4
- ----------------------------------------------------------------------------------
42 940901039 Town Center 0 5
43 940900904 Fairmount Centre 0 3
44 940901567 Mason Creek Center 0 4
- ----------------------------------------------------------------------------------
</TABLE>
DEFAULT RATE CODE DESCRIPTION
A The greater of (a) 4% above the stated interest rate on the Mortgage Loan and
(b) 4% above the prime rate reported in The Wall Street Journal.
B The lesser of (a) 150% of the stated interest rate on the Mortgage Loan and
(b) the highest rate permitted by law.
C The lesser of (a) 13.86% or (b) the maximum rate allowed under applicable
law.
D The lesser of (a) 13.48% or (b) the maximum rate allowed under applicable
law.
E A rate equal to 5% above the stated interest rate on the Mortgage Loan.
F The lesser of (a) 21% per annum or (b) the greater of (i) 4% above the
applicable interest rate on the Mortgage Loan or (ii) 4% above the Prime Rate
reported in The Wall Street Journal.
EXHIBIT B
PART II - 1
<PAGE> 346
EXHIBIT B: MORTGAGE LOAN SCHEDULE
PART II
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------
MIDLAND
LOAN ID ASSET PREPAY PREMIUM
# NUMBER PROPERTY NAME DURING YM PERIOD
- ----------------------------------------------------------------------------------
<S> <C> <C> <C>
1 940903231 Star Markets - Cambridge 5.00%
2 940903232 Star Markets - Quincy 5.00%
3 940903262 3307 M Street NW 1.00%
4 940902784 Ceasar Figoni Properties 1.00%
5 940901028 2982 Grand Avenue 5.00%
- ----------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor 5.00%
7 940902450 Gottschalks - Palmdale 5.00%
8 940902526 Garden Ridge 5.00%
9 940902047 Mack Park Apartments 5.00%
10 940902259 Park Villa Apartments 5.00%
- ----------------------------------------------------------------------------------
11 940902096 Spruce Financial Center 5.00%
12 940902453 Gottschalks - Yuba City 5.00%
13 940903276 Hydronautics Facility 1.50%
14 940902452 Gottschalks - Eureka 5.00%
15 940903265 BJ's Wholesale Club 2.00%
- ----------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center 5.00%
17 940900420 Riverdale Shopping Center 5.00%
18 940901138 Lafourche Plaza Shopping Ctr 5.00%
19 940902205 The Bristol House Gracious Retirement Living 5.00%
20 940901210 Westwood Center II 5.00%
- ----------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less 5.00%
22 940902048 Kingswood Apartments 5.00%
23 940902139 Kash N' Karry Store # 725 5.00%
24 940902140 Kash N' Karry Store # 733 5.00%
25 940901753 Kash N' Karry Store # 720 5.00%
- ----------------------------------------------------------------------------------
26 940900748 Comfort Inn 0.00%
27 940901739 Rialto Food-4-Less 5.00%
29 940901999 Food 4 Less Supermarket 5.00%
30 940901132 McPherron Properties 5.00%
31 940900880 Lost River Apartments 5.00%
- ----------------------------------------------------------------------------------
32 940903264 Leparc Apartments 1.00%
33 940900719 Live Oaks Center 5.00%
34 940901277 Union Plaza Office Building 5.00%
35 940901885 Frank's Nursery & Crafts Stores 1.00%
36 940901616 Santa Monica Plaza 0.00%
- ----------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center 5.00%
38 940901358 Meadowbrook Mobile Home Park 5.00%
39 940902485 University Village Apartments 5.00%
40 940903261 Univax Building 2.00%
41 940900945 Parkway Place 5.00%
- ----------------------------------------------------------------------------------
42 940901039 Town Center 5.00%
43 940900904 Fairmount Centre 5.00%
44 940901567 Mason Creek Center 5.00%
- ----------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
MIDLAND
LOAN ID ASSET
# NUMBER PROPERTY NAME % PREMIUM AFTER YM PERIOD
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1 940903231 Star Markets - Cambridge 5%,4%,3%,2%
2 940903232 Star Markets - Quincy 5%,4%,3%,2%
3 940903262 3307 M Street NW 0
4 940902784 Ceasar Figoni Properties 0
5 940901028 2982 Grand Avenue 5%,4%,3%,2%,1%
- -----------------------------------------------------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor 0
7 940902450 Gottschalks - Palmdale 0
8 940902526 Garden Ridge 0
9 940902047 Mack Park Apartments 5%
10 940902259 Park Villa Apartments 1%
- -----------------------------------------------------------------------------------------------------------------------------
11 940902096 Spruce Financial Center 3%,2%,1%
12 940902453 Gottschalks - Yuba City 0
13 940903276 Hydronautics Facility 0
14 940902452 Gottschalks - Eureka 0
15 940903265 BJ's Wholesale Club 0
- -----------------------------------------------------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center 5%,4%,3%,2%,1%
17 940900420 Riverdale Shopping Center 5%,4%,3%,2%,1%
18 940901138 Lafourche Plaza Shopping Ctr 5%,4%,3%,2%,1%
19 940902205 The Bristol House Gracious Retirement Living 0
20 940901210 Westwood Center II 5%,4%,3%,2%,1%
- -----------------------------------------------------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less 0
22 940902048 Kingswood Apartments 5%
23 940902139 Kash N' Karry Store # 725 5%,4%,3%,2%,1%
24 940902140 Kash N' Karry Store # 733 5%,4%,3%,2%,1%
25 940901753 Kash N' Karry Store # 720 5%,4%,3%,2%,1%
- -----------------------------------------------------------------------------------------------------------------------------
26 940900748 Comfort Inn 5%,4%,3%,2%,1%
27 940901739 Rialto Food-4-Less 0
</TABLE>
<PAGE> 347
<TABLE>
<S> <C> <C> <C>
29 940901999 Food 4 Less Supermarket 5%,4%,3%,2%,1%
30 940901132 McPherron Properties 5%,4%,3%,2%,1%
31 940900880 Lost River Apartments 5%,4%,3%,2%,1%
- -----------------------------------------------------------------------------------------------------------------------------
32 940903264 Leparc Apartments 5%,4%,3%,2%,1% (last 90 days of year 2005 open, no penalty)
33 940900719 Live Oaks Center 5%,4%,3%,2%,1%
34 940901277 Union Plaza Office Building 5%,4%,3%,2%,1%
35 940901885 Frank's Nursery & Crafts Stores 0
36 940901616 Santa Monica Plaza 0
- -----------------------------------------------------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center 5%,4%,3%,2%,1%
38 940901358 Meadowbrook Mobile Home Park 0
39 940902485 University Village Apartments 0
40 940903261 Univax Building 0
41 940900945 Parkway Place 5%,4%,3%,2%,1%
- -----------------------------------------------------------------------------------------------------------------------------
42 940901039 Town Center 4%,3%,2%,1%
43 940900904 Fairmount Centre 5%,4%,3%,2%,1%
44 940901567 Mason Creek Center 5%,4%,3%,2%,1%
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
MIDLAND TOTAL
LOAN ID ASSET PREMIUM MAXIMUM CROSS COLLAT-ERALIZED:
# NUMBER PROPERTY NAME PERIOD SERVICING RATE LOAN # SECURED INTEREST
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1 940903231 Star Markets - Cambridge 14 0.250% 2 Fee Simple
2 940903232 Star Markets - Quincy 14 0.250% 1 Fee Simple
3 940903262 3307 M Street NW 19.75 0.140% Fee Simple
4 940902784 Ceasar Figoni Properties 11 0.125% Fee Simple
5 940901028 2982 Grand Avenue 8 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor 6 0.250% Fee Simple
7 940902450 Gottschalks - Palmdale 10 0.250% 14;12 Fee Simple
8 940902526 Garden Ridge 5 0.250% Fee Simple
9 940902047 Mack Park Apartments 6 0.250% 22 Fee Simple
10 940902259 Park Villa Apartments 4.5 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
11 940902096 Spruce Financial Center 11 0.250% Fee Simple
12 940902453 Gottschalks - Yuba City 10 0.250% 7;14 Fee Simple
13 940903276 Hydronautics Facility 17 0.140% 51 Fee Simple
14 940902452 Gottschalks - Eureka 10 0.250% 7;12 Fee Simple
15 940903265 BJ's Wholesale Club 15.75 0.140% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center 9 0.250% Fee Simple
17 940900420 Riverdale Shopping Center 14.5 0.250% Ground Lease
18 940901138 Lafourche Plaza Shopping Ctr 8 0.250% Fee Simple
19 940902205 The Bristol House Gracious Retirement Living 6 0.250% 56 Fee Simple
20 940901210 Westwood Center II 8 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less 10 0.250% Fee Simple
22 940902048 Kingswood Apartments 6 0.250% 9 Fee Simple
23 940902139 Kash N' Karry Store # 725 14.5 0.250% Fee Simple
24 940902140 Kash N' Karry Store # 733 14.5 0.250% Fee Simple
25 940901753 Kash N' Karry Store # 720 14.5 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
26 940900748 Comfort Inn 5 0.250% Fee Simple
27 940901739 Rialto Food-4-Less 10 0.250% Fee Simple
29 940901999 Food 4 Less Supermarket 8 0.250% Fee Simple
30 940901132 McPherron Properties 8 0.250% Fee Simple
31 940900880 Lost River Apartments 10 0.250% 53 Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
32 940903264 Leparc Apartments 9.75 0.140% Fee Simple
33 940900719 Live Oaks Center 9 0.250% Fee Simple
34 940901277 Union Plaza Office Building 10 0.250% Fee Simple
35 940901885 Frank's Nursery & Crafts Stores 9.5 0.250% Fee Simple
36 940901616 Santa Monica Plaza 12 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center 9 0.250% Fee Simple
38 940901358 Meadowbrook Mobile Home Park 2 0.250% Fee Simple
39 940902485 University Village Apartments 6 0.250% Fee Simple
40 940903261 Univax Building 15 0.140% Fee Simple
41 940900945 Parkway Place 9 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
42 940901039 Town Center 9 0.250% Fee Simple
43 940900904 Fairmount Centre 8 0.250% Fee Simple
44 940901567 Mason Creek Center 9 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------
MIDLAND
LOAN ID ASSET
# NUMBER PROPERTY NAME PROPERY TYPE
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1 940903231 Star Markets - Cambridge Retail
2 940903232 Star Markets - Quincy Retail
3 940903262 3307 M Street NW Commercial/Residential
4 940902784 Ceasar Figoni Properties Multifamily
5 940901028 2982 Grand Avenue Office/Retail
- ---------------------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor Congregate Care
7 940902450 Gottschalks - Palmdale Retail
8 940902526 Garden Ridge Retail
9 940902047 Mack Park Apartments Multifamily
10 940902259 Park Villa Apartments Multifamily
- ---------------------------------------------------------------------------------------------
11 940902096 Spruce Financial Center Office
12 940902453 Gottschalks - Yuba City Retail
13 940903276 Hydronautics Facility Industrial/Light Industrial
14 940902452 Gottschalks - Eureka Retail
15 940903265 BJ's Wholesale Club Retail
- ---------------------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center Retail
17 940900420 Riverdale Shopping Center Retail
18 940901138 Lafourche Plaza Shopping Ctr Retail
19 940902205 The Bristol House Gracious Retirement Living Congregate Care
20 940901210 Westwood Center II Office/Retail
- ---------------------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less Retail
22 940902048 Kingswood Apartments Multifamily
23 940902139 Kash N' Karry Store # 725 Retail
24 940902140 Kash N' Karry Store # 733 Retail
25 940901753 Kash N' Karry Store # 720 Retail
- ---------------------------------------------------------------------------------------------
26 940900748 Comfort Inn Hotel
</TABLE>
<PAGE> 348
<TABLE>
<S> <C> <C> <C>
27 940901739 Rialto Food-4-Less Retail
29 940901999 Food 4 Less Supermarket Retail
30 940901132 McPherron Properties Multifamily
31 940900880 Lost River Apartments Multifamily
- ---------------------------------------------------------------------------------------------
32 940903264 Leparc Apartments Multifamily
33 940900719 Live Oaks Center Industrial/Light Industrial
34 940901277 Union Plaza Office Building Office
35 940901885 Frank's Nursery & Crafts Stores Retail
36 940901616 Santa Monica Plaza Retail
- ---------------------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center Retail
38 940901358 Meadowbrook Mobile Home Park Mobile Home Park
39 940902485 University Village Apartments Multifamily
40 940903261 Univax Building Office/Warehouse
41 940900945 Parkway Place Industrial/Light Industrial
- ---------------------------------------------------------------------------------------------
42 940901039 Town Center Retail
43 940900904 Fairmount Centre Retail
44 940901567 Mason Creek Center Retail
- ---------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
MIDLAND
LOAN ID ASSET
# NUMBER PROPERTY NAME ORIGINATOR
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1 940903231 Star Markets - Cambridge MCF
2 940903232 Star Markets - Quincy MCF
3 940903262 3307 M Street NW ULLICO
4 940902784 Ceasar Figoni Properties Arbor National Commercial Mortgage Corp.
5 940901028 2982 Grand Avenue MCF
- ----------------------------------------------------------------------------------------------------------
6 940902036 Mountain Creek Manor MCF
7 940902450 Gottschalks - Palmdale MCF
8 940902526 Garden Ridge MCF
9 940902047 Mack Park Apartments MCF
10 940902259 Park Villa Apartments MCF
- ----------------------------------------------------------------------------------------------------------
11 940902096 Spruce Financial Center MCF
12 940902453 Gottschalks - Yuba City MCF
13 940903276 Hydronautics Facility ULLICO
14 940902452 Gottschalks - Eureka MCF
15 940903265 BJ's Wholesale Club ULLICO
- ----------------------------------------------------------------------------------------------------------
16 940901855 Stafford Plaza Shopping Center MCF
17 940900420 Riverdale Shopping Center MCF
18 940901138 Lafourche Plaza Shopping Ctr MCF
19 940902205 The Bristol House Gracious Retirement Living MCF
20 940901210 Westwood Center II MCF
- ----------------------------------------------------------------------------------------------------------
21 940901740 Corona Food 4 Less MCF
22 940902048 Kingswood Apartments MCF
23 940902139 Kash N' Karry Store # 725 MCF
24 940902140 Kash N' Karry Store # 733 MCF
25 940901753 Kash N' Karry Store # 720 MCF
- ----------------------------------------------------------------------------------------------------------
26 940900748 Comfort Inn MCF
27 940901739 Rialto Food-4-Less MCF
29 940901999 Food 4 Less Supermarket MCF
30 940901132 McPherron Properties MCF
31 940900880 Lost River Apartments MCF
- ----------------------------------------------------------------------------------------------------------
32 940903264 Leparc Apartments ULLICO
33 940900719 Live Oaks Center MCF
34 940901277 Union Plaza Office Building MCF
35 940901885 Frank's Nursery & Crafts Stores MCF
36 940901616 Santa Monica Plaza MCF
- ----------------------------------------------------------------------------------------------------------
37 940900581 Highland Square Shopping Center MCF
38 940901358 Meadowbrook Mobile Home Park MCF
39 940902485 University Village Apartments MCF
40 940903261 Univax Building ULLICO
41 940900945 Parkway Place MCF
- ----------------------------------------------------------------------------------------------------------
42 940901039 Town Center MCF
43 940900904 Fairmount Centre MCF
44 940901567 Mason Creek Center MCF
- ----------------------------------------------------------------------------------------------------------
</TABLE>
EXHIBIT B
PART II - 2
<PAGE> 349
EXHIBIT B: MORTGAGE LOAN SCHEDULE
PART II
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
LOAN MIDLAND MONTHLY INTEREST DEFAULT MATURITY
ID # ASSET NUMBER PROPERTY NAME LOCATION PAYMENT RATE RATE DATE
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
45 940900742 Andover Retail Danvers, MA $17,805 9.58% A 9/1/10
46 940901620 Westridge Office Park Avon, IN $15,685 8.80% A 12/1/07
47 940901547 Candelaria Industrial Albuquerque, NM $16,754 8.72% A 12/1/07
48 940901783 U-Store Washington, DC $17,107 9.01% A 12/1/10
49 940900530 CVS Plaza West Deptford, NJ $14,548 8.85% A 11/1/07
- ----------------------------------------------------------------------------------------------------------------------------------
50 940900862 Chicago Financial Center Riverside, CA $14,081 8.84% A 12/1/07
51 940903277 Arizona Beverage Distributing Company Phoenix, AZ $16,691 8.45% B 11/1/10
52 940901004 Bering Village Shopping Center Anchorage, AK $15,836 9.66% A 9/1/10
53 940900932 Stonecrest Apartments Lafayette, IN $14,792 9.18% A 9/1/10
54 940901900 Rowland Heights Auto Center Rowland Heights, CA $16,636 9.39% A 12/1/11
- ----------------------------------------------------------------------------------------------------------------------------------
55 940901292 Lakewood Apartments Norman, OK $11,947 8.37% A 12/1/10
56 940902237 Walden Oaks Healthcare Center San Antonio, TX $13,198 8.69% A 11/1/10
57 940901609 Gerald Adams Properties New Orleans Area, LA $13,092 8.62% F 12/1/07
58 940901266 Lightning Creek Shopping Center & Apts Oklahoma City, OK $12,871 9.70% A 9/1/10
59 940901534 Macarthur Mills Office Park Carrollton, TX $12,186 9.32% A 8/1/05
- ----------------------------------------------------------------------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments Pleasantville, NJ $11,980 9.24% C 9/1/05
61 940900776 Wickes Furniture Aurora, IL $12,750 9.17% A 7/1/10
62 940901586 815 South Main Street Grapevine, TX $11,468 9.15% A 9/1/07
63 940902320 Holly Hills Apartments Denton, TX $12,777 8.15% A 12/1/10
64 940901775 Oak Creek Apartments Austin, TX $11,002 8.87% A 11/1/10
- ----------------------------------------------------------------------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park Loveland, CO $11,126 8.31% A 12/1/02
66 940901542 The Centers III Lynnwood, WA $10,635 8.69% A 12/1/07
67 940901452 Mark VI Apartments Houston, TX $10,630 8.92% A 12/1/07
68 940901591 8435-8447 Canoga Avenue Canoga Park, CA $11,554 9.38% A 9/1/07
69 940902050 Ridgmar Manor Apartments Fort Worth, TX $9,744 8.60% A 11/1/10
- ----------------------------------------------------------------------------------------------------------------------------------
70 940900480 Wellington Apartments Leominster, MA $9,572 8.90% A 12/1/05
71 940901006 National Self Storage - Alb-4 Albuquerque, NM $11,163 10.06% A 9/1/10
72 940900584 Doug's Storage Florissant, MO $11,707 9.83% A 7/1/10
73 940902041 Abilene Village Shopping Center Abilene, TX $8,668 8.80% A 12/1/07
74 940900860 Stratford Manor Apartments Jackson, MS $7,992 8.41% A 7/1/05
- ----------------------------------------------------------------------------------------------------------------------------------
75 940901134 Genesis Medical Center Phoenix, AZ $7,674 8.86% A 8/1/07
76 940901103 Witmer Industrial Estate Niagara, NY $7,399 8.75% A 11/1/07
77 940901533 April Lane Commerce Park Columbus, OH $7,534 8.97% A 10/1/07
78 940901152 Windfern Industrial Park Houston, TX $7,011 8.79% A 12/1/10
79 940901941 Hillsborough Office Building Roseville, MN $6,626 8.47% A 12/1/10
- ----------------------------------------------------------------------------------------------------------------------------------
80 940900507 Walgreens Plaza Middletown, CT $6,825 9.36% A 8/1/10
81 940901218 Greenhouse Apartments Grand Junction, CO $6,340 9.09% A 9/1/07
82 940900456 Maplewood Auto Mall Maplewood, MN $6,980 9.67% A 9/1/07
83 940900155 Goffstown Village Apartments Goffstown/Franklin, NH $6,209 9.25% A 8/1/03
84 940900953 Chestnut Square Apartments Midwest City, OK $5,634 9.40% A 9/1/05
85 940900610 Lyn Village Apartments Reynoldsburg, OH $4,953 8.80% A 8/1/07
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
ORIGINAL UNDER UNDER
LOAN MIDLAND AMORTIZ. CUT-OFF DATE WRITTEN WRITTEN
ID # ASSET NUMBER PROPERTY NAME (MONTHS) BALANCE UNDERWRITTEN NCF DSCR LTV
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
45 940900742 Andover Retail 300 $2,020,044 $290,931 1.36 69.04%
46 940901620 Westridge Office Park 300 $1,900,000 $257,986 1.37 73.26%
47 940901547 Candelaria Industrial 240 $1,900,000 $279,508 1.39 70.61%
48 940901783 U-Store 240 $1,900,000 $305,015 1.49 68.52%
49 940900530 CVS Plaza 300 $1,753,395 $227,519 1.30 74.53%
- ---------------------------------------------------------------------------------------------------------------------------
50 940900862 Chicago Financial Center 300 $1,700,000 $221,469 1.31 71.51%
51 940903277 Arizona Beverage Distributing Company 180 $1,695,280 $240,379 1.20 68.47%
52 940901004 Bering Village Shopping Center 240 $1,673,009 $266,796 1.40 64.60%
53 940900932 Stonecrest Apartments 264 $1,669,020 $234,679 1.32 74.67%
54 940901900 Rowland Heights Auto Center 192 $1,650,000 $263,778 1.32 68.85%
- ---------------------------------------------------------------------------------------------------------------------------
55 940901292 Lakewood Apartments 300 $1,500,000 $201,769 1.41 74.34%
56 940902237 Walden Oaks Healthcare Center 240 $1,497,664 $238,609 1.51 69.04%
57 940901609 Gerald Adams Properties 240 $1,495,500 $214,732 1.37 73.13%
58 940901266 Lightning Creek Shopping Center & Apts 300 $1,446,522 $191,600 1.24 72.20%
59 940901534 Macarthur Mills Office Park 300 $1,410,158 $194,724 1.33 65.93%
- ---------------------------------------------------------------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments 300 $1,395,144 $189,397 1.32 75.14%
61 940900776 Wickes Furniture 240 $1,381,505 $214,939 1.40 72.68%
62 940901586 815 South Main Street 300 $1,346,450 $253,295 1.84 59.71%
63 940902320 Holly Hills Apartments 180 $1,325,000 $275,131 1.79 46.95%
64 940901775 Oak Creek Apartments 300 $1,323,792 $168,300 1.27 74.72%
- ---------------------------------------------------------------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park 240 $1,300,000 $157,899 1.18 82.33%
66 940901542 The Centers III 300 $1,300,000 $175,443 1.37 74.48%
67 940901452 Mark VI Apartments 300 $1,275,000 $170,282 1.33 74.88%
68 940901591 8435-8447 Canoga Avenue 240 $1,244,609 $188,734 1.36 67.02%
69 940902050 Ridgmar Manor Apartments 300 $1,198,856 $152,599 1.31 74.63%
- ---------------------------------------------------------------------------------------------------------------------------
70 940900480 Wellington Apartments 300 $1,150,000 $188,678 1.64 64.00%
71 940901006 National Self Storage - Alb-4 240 $1,147,446 $181,976 1.36 69.36%
72 940900584 Doug's Storage 180 $1,086,299 $202,116 1.44 59.12%
73 940902041 Abilene Village Shopping Center 300 $1,050,000 $137,927 1.33 73.28%
74 940900860 Stratford Manor Apartments 300 $995,014 $125,340 1.31 73.43%
- ---------------------------------------------------------------------------------------------------------------------------
75 940901134 Genesis Medical Center 300 $921,584 $127,730 1.39 67.46%
76 940901103 Witmer Industrial Estate 300 $899,163 $118,162 1.33 71.00%
77 940901533 April Lane Commerce Park 300 $898,380 $122,917 1.36 67.05%
78 940901152 Windfern Industrial Park 300 $850,000 $115,352 1.37 69.65%
79 940901941 Hillsborough Office Building 300 $825,000 $118,525 1.49 65.55%
- ---------------------------------------------------------------------------------------------------------------------------
80 940900507 Walgreens Plaza 300 $787,315 $104,352 1.27 74.34%
81 940901218 Greenhouse Apartments 300 $748,008 $101,973 1.34 73.35%
82 940900456 Maplewood Auto Mall 240 $736,924 $114,081 1.36 65.20%
83 940900155 Goffstown Village Apartments 300 $722,490 $102,881 1.38 73.74%
84 940900953 Chestnut Square Apartments 300 $648,360 $92,969 1.38 73.23%
85 940900610 Lyn Village Apartments 300 $597,762 $92,651 1.56 67.74%
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 350
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
NON-PREMIUM LOCKOUT
LOAN MIDLAND PREPAYMENTS PERIOD
ID # ASSET NUMBER PROPERTY NAME PROPERTY MANAGER PERMITTED (YEARS)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
45 940900742 Andover Retail Corbett Realty & Appraisal Service FALSE 0
46 940901620 Westridge Office Park Westar FALSE 0
47 940901547 Candelaria Industrial Self Managed FALSE 0
48 940901783 U-Store U-Store Company FALSE 0
49 940900530 CVS Plaza D'Anastasio Corporation FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
50 940900862 Chicago Financial Center The Magnon Companies FALSE 0
51 940903277 Arizona Beverage Distributing Company Sierra Capital Mgmnt FALSE 4
52 940901004 Bering Village Shopping Center H & R Mgmnt, Inc. FALSE 0
53 940900932 Stonecrest Apartments American Mgmnt Services FALSE 0
54 940901900 Rowland Heights Auto Center Abrams Venture, Inc. FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
55 940901292 Lakewood Apartments McCasland Co. (Self) FALSE 0
56 940902237 Walden Oaks Healthcare Center Leisure Centers, Inc. FALSE 0
57 940901609 Gerald Adams Properties Rosenburg Investment Company FALSE 0
58 940901266 Lightning Creek Shopping Center & Apts Principal of borrowing entity FALSE 0
59 940901534 Macarthur Mills Office Park Carmel Realty Services, Ltd. FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments Samson Mgmnt Co. FALSE 5
61 940900776 Wickes Furniture Bradley Associates TRUE 0
62 940901586 815 South Main Street Self Managed FALSE 0
63 940902320 Holly Hills Apartments Wells Asset Mgmnt FALSE 0
64 940901775 Oak Creek Apartments KVA Property Mgmnt FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park Affordable Residential Communities FALSE 0
66 940901542 The Centers III F.R. McAbee Inc. FALSE 0
67 940901452 Mark VI Apartments Self Managed FALSE 0
68 940901591 8435-8447 Canoga Avenue Self Managed FALSE 0
69 940902050 Ridgmar Manor Apartments FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
70 940900480 Wellington Apartments Self Managed FALSE 0
71 940901006 National Self Storage - Alb-4 National Self Storage FALSE 0
72 940900584 Doug's Storage Principal of Borrowing entity FALSE 0
73 940902041 Abilene Village Shopping Center Self Managed FALSE 0
74 940900860 Stratford Manor Apartments DalWorth Mgmnt FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
75 940901134 Genesis Medical Center Family member FALSE 0
76 940901103 Witmer Industrial Estate Flain Development Corp FALSE 0
77 940901533 April Lane Commerce Park Self Managed FALSE 0
78 940901152 Windfern Industrial Park Tarantino Properties FALSE 0
79 940901941 Hillsborough Office Building Self Managed FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
80 940900507 Walgreens Plaza Owner-mangaed FALSE 0
81 940901218 Greenhouse Apartments European Investment Management Services FALSE 0
82 940900456 Maplewood Auto Mall PBK Investments, Inc. FALSE 0
83 940900155 Goffstown Village Apartments Sentry Mgmnt Corp. FALSE 0
84 940900953 Chestnut Square Apartments Womack Properties FALSE 0
85 940900610 Lyn Village Apartments Central Mgmnt Company FALSE 0
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------
LOAN MIDLAND YM PERIOD
ID # ASSET NUMBER PROPERTY NAME (YEARS)
- ----------------------------------------------------------------------
<S> <C> <C> <C>
45 940900742 Andover Retail 5
46 940901620 Westridge Office Park 10
47 940901547 Candelaria Industrial 5
48 940901783 U-Store 5
49 940900530 CVS Plaza 4
- -------------------------------------------------------------------
50 940900862 Chicago Financial Center 4
51 940903277 Arizona Beverage Distributing Company 11
52 940901004 Bering Village Shopping Center 5
53 940900932 Stonecrest Apartments 5
54 940901900 Rowland Heights Auto Center 5
- -------------------------------------------------------------------
55 940901292 Lakewood Apartments 7
56 940902237 Walden Oaks Healthcare Center 10
57 940901609 Gerald Adams Properties 4
58 940901266 Lightning Creek Shopping Center & Apts 5
59 940901534 Macarthur Mills Office Park 3
- -------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments 0
61 940900776 Wickes Furniture 5
62 940901586 815 South Main Street 4
63 940902320 Holly Hills Apartments 7
64 940901775 Oak Creek Apartments 8
- -------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park 2
66 940901542 The Centers III 4
67 940901452 Mark VI Apartments 4
68 940901591 8435-8447 Canoga Avenue 4
69 940902050 Ridgmar Manor Apartments 10
- -------------------------------------------------------------------
70 940900480 Wellington Apartments 3
71 940901006 National Self Storage - Alb-4 5
72 940900584 Doug's Storage 5
73 940902041 Abilene Village Shopping Center 4
74 940900860 Stratford Manor Apartments 3
- -------------------------------------------------------------------
75 940901134 Genesis Medical Center 4
76 940901103 Witmer Industrial Estate 4
77 940901533 April Lane Commerce Park 4
78 940901152 Windfern Industrial Park 5
79 940901941 Hillsborough Office Building 7
- -------------------------------------------------------------------
80 940900507 Walgreens Plaza 5
</TABLE>
<PAGE> 351
<TABLE>
<S> <C> <C> <C>
81 940901218 Greenhouse Apartments 4
82 940900456 Maplewood Auto Mall 4
83 940900155 Goffstown Village Apartments 6
84 940900953 Chestnut Square Apartments 3
85 940900610 Lyn Village Apartments 4
- -------------------------------------------------------------------
</TABLE>
DEFAULT RATE CODE DESCRIPTION
A The greater of (a) 4% above the stated interest rate on the Mortgage Loan and
(b) 4% above the prime rate reported in The Wall Street Journal.
B The lesser of (a) 150% of the stated interest rate on the Mortgage Loan and
(b) the highest rate permitted by law.
C The lesser of (a) 13.86% or (b) the maximum rate allowed under applicable
law.
D The lesser of (a) 13.48% or (b) the maximum rate allowed under applicable
law.
E A rate equal to 5% above the stated interest rate on the Mortgage Loan.
F The lesser of (a) 21% per annum or (b) the greater of (i) 4% above the
applicable interest rate on the Mortgage Loan or (ii) 4% above the Prime Rate
reported in The Wall Street Journal.
EXHIBIT B
PART II - 3
<PAGE> 352
EXHIBIT B: MORTGAGE LOAN SCHEDULE
PART II
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
LOAN MIDLAND PREPAY PREMIUM
ID # ASSET NUMBER PROPERTY NAME DURING YM PERIOD
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
45 940900742 Andover Retail 5.00%
46 940901620 Westridge Office Park 5.00%
47 940901547 Candelaria Industrial 5.00%
48 940901783 U-Store 5.00%
49 940900530 CVS Plaza 5.00%
- -------------------------------------------------------------------------------
50 940900862 Chicago Financial Center 5.00%
51 940903277 Arizona Beverage Distributing Company 1.50%
52 940901004 Bering Village Shopping Center 5.00%
53 940900932 Stonecrest Apartments 5.00%
54 940901900 Rowland Heights Auto Center 5.00%
- -------------------------------------------------------------------------------
55 940901292 Lakewood Apartments 5.00%
56 940902237 Walden Oaks Healthcare Center 5.00%
57 940901609 Gerald Adams Properties 5.00%
58 940901266 Lightning Creek Shopping Center & Apts 5.00%
59 940901534 Macarthur Mills Office Park 5.00%
- -------------------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments 1.00%
61 940900776 Wickes Furniture 5.00%
62 940901586 815 South Main Street 5.00%
63 940902320 Holly Hills Apartments 5.00%
64 940901775 Oak Creek Apartments 5.00%
- -------------------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park 5.00%
66 940901542 The Centers III 5.00%
67 940901452 Mark VI Apartments 5.00%
68 940901591 8435-8447 Canoga Avenue 5.00%
69 940902050 Ridgmar Manor Apartments 5.00%
- -------------------------------------------------------------------------------
70 940900480 Wellington Apartments 5.00%
71 940901006 National Self Storage - Alb-4 5.00%
72 940900584 Doug's Storage 5.00%
73 940902041 Abilene Village Shopping Center 5.00%
74 940900860 Stratford Manor Apartments 5.00%
- -------------------------------------------------------------------------------
75 940901134 Genesis Medical Center 5.00%
76 940901103 Witmer Industrial Estate 5.00%
77 940901533 April Lane Commerce Park 5.00%
78 940901152 Windfern Industrial Park 5.00%
79 940901941 Hillsborough Office Building 5.00%
- -------------------------------------------------------------------------------
80 940900507 Walgreens Plaza 5.00%
81 940901218 Greenhouse Apartments 5.00%
82 940900456 Maplewood Auto Mall 5.00%
83 940900155 Goffstown Village Apartments 1.00%
84 940900953 Chestnut Square Apartments 5.00%
85 940900610 Lyn Village Apartments 5.00%
- -------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
TOTAL
LOAN MIDLAND PREMIUM
ID # ASSET NUMBER PROPERTY NAME % PREMIUM AFTER YM PERIOD PERIOD
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
45 940900742 Andover Retail 5%,4%,3%,2%,1% 10
46 940901620 Westridge Office Park 0 10
47 940901547 Candelaria Industrial 5%,4%,3%,2%,1% 10
48 940901783 U-Store 5%,4%,3%,2%,1% 10
49 940900530 CVS Plaza 5%,4%,3%,2%,1% 9
- ---------------------------------------------------------------------------------------------------------------------
50 940900862 Chicago Financial Center 5%,4%,3%,2%,1% 9
51 940903277 Arizona Beverage Distributing Company 0 15
52 940901004 Bering Village Shopping Center 5%,4%,3%,2%,1% 10
53 940900932 Stonecrest Apartments 5%,4%,3%,2%,1% 10
54 940901900 Rowland Heights Auto Center 5%,4%,3%,2%,1% 10
- ---------------------------------------------------------------------------------------------------------------------
55 940901292 Lakewood Apartments 5%,4%,3%,2% 11
56 940902237 Walden Oaks Healthcare Center 0 10
57 940901609 Gerald Adams Properties 5%,4%,3%,2%,1% 9
58 940901266 Lightning Creek Shopping Center & Apts 5%,4%,3%,2%,1% 10
59 940901534 Macarthur Mills Office Park 5%,4%,3%,2%,1% 8
- ---------------------------------------------------------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments 5% (last 120 days of year 2000), 4%, 3%, 2%, 1%
(last 90 days of year 2004 open, no penalty) 9.333
61 940900776 Wickes Furniture 5%,4%,3%,2%,1% 10
62 940901586 815 South Main Street 5%,4%,3%,2%,1% 9
63 940902320 Holly Hills Apartments 5%,5%,5%,4%,3%,2%,1% 14
64 940901775 Oak Creek Apartments 5%,4%,3%,2%,1% 13
- ---------------------------------------------------------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park 0 2
66 940901542 The Centers III 5%,4%,3%,2%,1% 9
67 940901452 Mark VI Apartments 3%,3%,2%,2%,1%,1% 10
68 940901591 8435-8447 Canoga Avenue 5%,4%,3%,2%,1% 9
69 940902050 Ridgmar Manor Apartments 0 10
- ---------------------------------------------------------------------------------------------------------------------
70 940900480 Wellington Apartments 5%,4%,3%,2%,1% 8
71 940901006 National Self Storage - Alb-4 5%,4%,3%,2%,1% 10
72 940900584 Doug's Storage 5%,4%,3%,2%,1% 10
73 940902041 Abilene Village Shopping Center 5%,4%,3%,2%,1% 9
74 940900860 Stratford Manor Apartments 5%,4%,3%,2%,1% 8
</TABLE>
<PAGE> 353
<TABLE>
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------
75 940901134 Genesis Medical Center 5%,4%,3%,2%,1% 9
76 940901103 Witmer Industrial Estate 5%,4%,3%,2%,1% 9
77 940901533 April Lane Commerce Park 5%,4%,3%,2%,1% 9
78 940901152 Windfern Industrial Park 5%,4%,3%,2% 9
79 940901941 Hillsborough Office Building 5%,4%,3%,2%,1% 12
- ---------------------------------------------------------------------------------------------------------------------
80 940900507 Walgreens Plaza 5%,4%,3%,2%,1% 10
81 940901218 Greenhouse Apartments 5%,4%,3%,2%,1% 9
82 940900456 Maplewood Auto Mall 5%,4%,3%,2%,1% 9
83 940900155 Goffstown Village Apartments 1% 7
84 940900953 Chestnut Square Apartments 5%,4%,3%,2%,1% 8
85 940900610 Lyn Village Apartments 5%,4%,3%,2%,1% 9
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------
CROSS
LOAN MIDLAND MAXIMUM COLLAT-ERALIZED: SECURED
ID # ASSET NUMBER PROPERTY NAME SERVICING RATE LOAN # INTEREST
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
45 940900742 Andover Retail 0.250% Fee Simple
46 940901620 Westridge Office Park 0.250% Fee Simple
47 940901547 Candelaria Industrial 0.250% Fee Simple
48 940901783 U-Store 0.250% Fee Simple
49 940900530 CVS Plaza 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
50 940900862 Chicago Financial Center 0.250% Fee Simple
51 940903277 Arizona Beverage Distributing Company 0.140% 13 Fee Simple
52 940901004 Bering Village Shopping Center 0.250% Ground Lease
53 940900932 Stonecrest Apartments 0.250% 31 Fee Simple
54 940901900 Rowland Heights Auto Center 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
55 940901292 Lakewood Apartments 0.250% Fee Simple
56 940902237 Walden Oaks Healthcare Center 0.250% 19 Fee Simple
57 940901609 Gerald Adams Properties 0.250% Fee Simple
58 940901266 Lightning Creek Shopping Center & Apts 0.250% Fee Simple
59 940901534 Macarthur Mills Office Park 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments
0.140% Fee Simple
61 940900776 Wickes Furniture 0.250% Fee Simple
62 940901586 815 South Main Street 0.250% Fee Simple
63 940902320 Holly Hills Apartments 0.250% Fee Simple
64 940901775 Oak Creek Apartments 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park 0.250% Fee Simple
66 940901542 The Centers III 0.250% Fee Simple
67 940901452 Mark VI Apartments 0.250% Fee Simple
68 940901591 8435-8447 Canoga Avenue 0.250% Fee Simple
69 940902050 Ridgmar Manor Apartments 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
70 940900480 Wellington Apartments 0.250% Fee Simple
71 940901006 National Self Storage - Alb-4 0.250% Fee Simple
72 940900584 Doug's Storage 0.250% Fee Simple
73 940902041 Abilene Village Shopping Center 0.250% Fee Simple
74 940900860 Stratford Manor Apartments 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
75 940901134 Genesis Medical Center 0.250% Fee Simple
76 940901103 Witmer Industrial Estate 0.250% Fee Simple
77 940901533 April Lane Commerce Park 0.250% Fee Simple
78 940901152 Windfern Industrial Park 0.250% Fee Simple
79 940901941 Hillsborough Office Building 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
80 940900507 Walgreens Plaza 0.250% Fee Simple
81 940901218 Greenhouse Apartments 0.250% Fee Simple
82 940900456 Maplewood Auto Mall 0.250% Fee Simple
83 940900155 Goffstown Village Apartments 0.250% Fee Simple
84 940900953 Chestnut Square Apartments 0.250% Fee Simple
85 940900610 Lyn Village Apartments 0.250% Fee Simple
- -----------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
LOAN MIDLAND
ID # ASSET NUMBER PROPERTY NAME PROPERY TYPE ORIGINATOR
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
45 940900742 Andover Retail Retail MCF
46 940901620 Westridge Office Park Office MCF
47 940901547 Candelaria Industrial Industrial/Light Industrial MCF
48 940901783 U-Store Self Storage MCF
49 940900530 CVS Plaza Retail MCF
- ----------------------------------------------------------------------------------------------------
50 940900862 Chicago Financial Center Office MCF
51 940903277 Arizona Beverage Distributing Company Industrial/Light Industrial ULLICO
52 940901004 Bering Village Shopping Center Retail MCF
53 940900932 Stonecrest Apartments Multifamily MCF
54 940901900 Rowland Heights Auto Center Retail MCF
- ----------------------------------------------------------------------------------------------------
55 940901292 Lakewood Apartments Multifamily MCF
56 940902237 Walden Oaks Healthcare Center Nursing Home MCF
57 940901609 Gerald Adams Properties Multifamily MCF
58 940901266 Lightning Creek Shopping Center & Apts Retail/Multifamily MCF
59 940901534 Macarthur Mills Office Park Office MCF
- ----------------------------------------------------------------------------------------------------
60 940903263 Seagrass Cove Apartments
Multifamily ULLICO
61 940900776 Wickes Furniture Retail MCF
62 940901586 815 South Main Street Industrial/Light Industrial MCF
63 940902320 Holly Hills Apartments Multifamily MCF
64 940901775 Oak Creek Apartments Multifamily MCF
- ----------------------------------------------------------------------------------------------------
65 940901831 Loveland Plaza Mobile Home Park Mobile Home Park MCF
66 940901542 The Centers III Retail MCF
67 940901452 Mark VI Apartments Multifamily MCF
68 940901591 8435-8447 Canoga Avenue Industrial/Light Industrial MCF
69 940902050 Ridgmar Manor Apartments Multifamily MCF
- ----------------------------------------------------------------------------------------------------
70 940900480 Wellington Apartments Multifamily MCF
71 940901006 National Self Storage - Alb-4 Self Storage MCF
72 940900584 Doug's Storage Self Storage MCF
73 940902041 Abilene Village Shopping Center Retail MCF
74 940900860 Stratford Manor Apartments Multifamily MCF
- ----------------------------------------------------------------------------------------------------
75 940901134 Genesis Medical Center Office MCF
76 940901103 Witmer Industrial Estate Industrial/Light Industrial MCF
</TABLE>
<PAGE> 354
<TABLE>
<S> <C> <C> <C> <C>
77 940901533 April Lane Commerce Park Office/Warehouse MCF
78 940901152 Windfern Industrial Park Industrial/Light Industrial MCF
79 940901941 Hillsborough Office Building Office MCF
- ----------------------------------------------------------------------------------------------------
80 940900507 Walgreens Plaza Retail MCF
81 940901218 Greenhouse Apartments Multifamily MCF
82 940900456 Maplewood Auto Mall Retail MCF
83 940900155 Goffstown Village Apartments Multifamily MCF
84 940900953 Chestnut Square Apartments Multifamily MCF
85 940900610 Lyn Village Apartments Multifamily MCF
- ----------------------------------------------------------------------------------------------------
</TABLE>
EXHIBIT B
PART II - 4
<PAGE> 355
EXHIBIT C-1
AFFIDAVIT PURSUANT TO
SECTION 860E(e)(4) OF THE
INTERNAL REVENUE CODE OF
1986, AS AMENDED
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
_________________________, being first duly sworn, deposes and
says:
1. That he is a ________ of ____________________________
_____ (the "Purchaser"), a __________ duly organized and existing under the
laws of the State of ________, on behalf of which he makes this affidavit.
2. That the Purchaser's Taxpayer Identification Number
is __________.
3. That the Purchaser of the Prudential Securities
Secured Financing Corporation, Commercial Mortgage Pass-Through Certificates,
Series __________, Class (R/LR) Certificate No. ____ (the "Class R/LR
Certificates") is a Permitted Transferee (as defined in Article I of the
Pooling and Servicing Agreement, dated as of December 1, 1995, by and among
Prudential Securities Secured Financing Corporation, as depositor, Midland Loan
Services, L.P., as servicer, Lennar Partners, Inc. as Special Servicer, LaSalle
National Bank, as trustee, and ABN AMRO Bank N.V., as fiscal agent (the
"Pooling and Servicing Agreement") or is acquiring the Class (R/LR)
Certificates for the account of, or as agent (including as a broker, nominee,
or other middleman) for, a Permitted Transferee and has received from such
person or entity an affidavit substantially in the form of this affidavit.
4. That the Purchaser historically has paid its debts
as they have come due and intends to pay its debts as they come due in the
future and the Purchaser intends to pay taxes associated with holding the
Class (R/LR) Certificates as they become due.
5. That the Purchaser understands that it may incur tax
liabilities with respect to the Class (R/LR) Certificates in excess of any
cash flow generated by the Class (R/LR) Certificates.
<PAGE> 356
6. That the Purchaser will not transfer the Class (R/LR)
Certificates to any person or entity from which the Purchaser has not received
an affidavit substantially in the form of this affidavit or as to which the
Purchaser has actual knowledge that the requirements set forth in paragraph 3,
paragraph 4 or paragraph 7 hereof are not satisfied or that the Purchaser has
reason to know does not satisfy the requirements set forth in paragraph 4
hereof.
7. That the Purchaser is not a Disqualified Non-U.S. Person (as
defined in Article I of the Pooling and Servicing Agreement) and is not
purchasing the Class (R/LR) Certificates for the account of, or as an agent
(including as a broker, nominee or other middleman) for, a Disqualified Non-U.S.
Person.
8. That the Purchaser agrees to such amendments of the Pooling
and Servicing Agreement as may be required to further effectuate the
restrictions on transfer of the Class (R/LR) Certificates to such a
"disqualified organization," an agent thereof, or a person that does not satisfy
the requirements of paragraph 4 and paragraph 7 hereof.
9. That, if a "tax matters person" is required to be designated
with respect to the (Upper-Tier/Lower-Tier) REMIC, the Purchaser agrees to act
as "tax matters person" and to perform the functions of "tax matters partner" of
the (Upper-Tier/Lower-Tier) REMIC pursuant to Section 4.4 of the Pooling and
Servicing Agreement, and agrees to the irrevocable designation of the Trustee as
the Purchaser's agent in performing the function of "tax matters person" and
"tax matters partner."
10. The Purchaser agrees to be bound by and to abide by the
provisions of Section 5.2 of the Pooling and Servicing Agreement concerning
registration of the transfer and exchange of Class (R/LR) Certificates.
[Signature on next page]
<PAGE> 357
IN WITNESS WHEREOF, the Purchaser has caused this
instrument to be executed on its behalf, pursuant to authority of its Board of
Directors, by its this ____th day of ___________, 199_.
[Purchaser]
By: _______________________
Title:
Name:
personally appeared before me the above-named_________________
__________________, known or proved to me to be the same person who executed the
foregoing instrument and to be the __________ of the Purchaser, and acknowledged
to me that he executed the same as his free act and deed and the free act and
deed of the Purchaser.
Subscribed and sworn before me this ____th day of __________, 199_.
_____________________________
NOTARY PUBLIC
COUNTY OF _____________
STATE OF ______________
My commission expires the __ th day of ___________, 199_.
<PAGE> 358
EXHIBIT C-2
FORM OF TRANSFEROR LETTER
[Date]
[CERTIFICATE REGISTRAR]
Re: Prudential Securities Secured Financing Corporation, Commercial
Mortgage Pass-Through Certificates, Series 1995-MCF-2
---------------------------------------------------------------
Ladies and Gentlemen:
[Transferor] has reviewed the attached affidavit of
[Transferee], and has no actual knowledge that such affidavit is not true and
has no reason to know that the information contained in paragraph 4 thereof is
not true.
Very truly yours,
[TRANSFEROR]
___________________________
<PAGE> 359
EXHIBIT D-1
FORM OF INVESTMENT REPRESENTATION LETTER
LaSalle National Bank, as Trustee
and Certificate Registrar
135 South LaSalle Street
Suite 200
Chicago, Illinois 60603
Attention: Corporate Trust Administration
Prudential Securities Secured Financing Corporation
One New York Plaza
New York, New York 10292
Re: Transfer of Prudential Securities Secured Financing
Corporation, Commercial Mortgage Pass-Through Certificates, Series 1995-MCF-2
Class ______________________________________________________
Ladies and Gentlemen:
This letter is delivered pursuant to Section 5.2 of the Pooling
and Servicing Agreement, dated as of December 1, 1995 (the "Pooling and
Servicing Agreement"), by and among Prudential Securities Secured Financing
Corporation, as depositor, Midland Loan Services, L.P., as servicer, Lennar
Partners, Inc. as special servicer, LaSalle National Bank, as trustee (the
"Trustee") and ABN AMRO Bank N.V., as fiscal agent (the "Fiscal Agent") on
behalf of the holders of Prudential Securities Secured Funding Corporation,
Commercial Mortgage Pass-Through Certificates, Series __________ (the
"Certificates") in connection with the transfer by ____________________________
_________________________ (the "Seller") to the undersigned (the "Purchaser") of
$__________ aggregate [Certificate] [National] Balance of Class ___
Certificates, in certificated fully registered form (such registered interest
being the "Certificate"). Terms used but not
<PAGE> 360
defined herein shall have the meanings ascribed thereto in the Pooling and
Servicing Agreement.
In connection with such transfer, the undersigned hereby
represents and warrants to you as follows:
[[For Institutional Accredited Investors] 1. We are an
"institutional accredited investor" (an entity meeting the requirements of Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act of 1933, as
amended (the "1933 Act")) and have such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks or our
investment in the Certificates, and we and any accounts for which we are acting
are each able to bear the economic risk of our or its investment. We are
acquiring the Certificates purchased by us for investment for our own account
or for one or more accounts (each of which is an "institutional accredited
investor") as to each of which we exercise sole investment discretion. The
Purchaser hereby undertakes to reimburse the Trust for any costs incurred by
it in connection with this transfer.]
[[For Qualified Institutional Buyers only] 1. The Purchaser is
a "qualified institutional buyer" within the meaning of Rule 144A ("Rule 144A")
promulgated under the Securities Act of 1933, as amended (the "1933 Act"). The
Purchaser is aware that the transfer is being made in reliance on Rule 144A, and
the Purchaser has had the opportunity to obtain the information required to be
provided pursuant to paragraph (d)(4)(i) of Rule 144A. The Purchaser's intention
is to acquire the Certificate (a) for investment for the Purchaser's own account
or (b) for resale to "qualified institutional buyers" in transactions under Rule
144A, and not in any event with the view to, or for resale in connection with,
any distribution thereof.
2. The Purchaser understands that the Certificate (and any
subsequent Certificate) has not been registered under the 1933 Act, by reason of
a specified exemption from the registration provisions of the 1933 Act which
depends upon, among other things, the bona fide nature of the Purchaser's
investment intent (or intent to resell only to certain investors in certain
exempted transactions) as expressed herein.]
3. The Purchaser acknowledges that the Certificate (and any
Certificate issued on transfer or exchange thereof) has not been registered or
qualified under the 1933 Act or the securities laws of any State or any other
jurisdiction, and that the Certificate cannot be resold unless it is registered
or qualified thereunder or unless an exemption from such registration or
qualification is available and the transfer is to (i) a "qualified institutional
buyer" pursuant to Rule 144A or (ii) an "institutional accredited investor"
meeting the requirements of Rule 501(a)(1), (2), (3) or (7) of Regulation D
promulgated under the 1933 Act, pursuant to any other exemption from the
registration requirements of the 1933 Act, subject in the case of this clause
(iii) to (a) the receipt by the Certificate Registrar of a letter substantially
in the form hereof, (b) the receipt by the Certificate Registrar of an opinion
of counsel acceptable to the Certificate Registrar that such reoffer, resale,
pledge or transfer is in compliance with the 1933 Act, (c) the receipt by the
Certificate Registrar of such other evidence acceptable to the Certificate
Registrar that such reoffer, resale, pledge or transfer is in compliance with
the 1933 Act and other applicable laws, and (d) a written undertaking to
reimburse the Trust for any costs incurred by it in connection with the proposed
transfer.
4. The Purchaser has reviewed the Private Placement Memorandum
dated December __, 1995, relating to the Certificates (the "Private Placement
Memorandum") and the agreements and other materials referred to therein and has
had the opportunity to ask questions and receive answers concerning the terms
and conditions of the transactions contemplated by the Private Placement
Memorandum.
5. The Purchaser hereby undertakes to be bound by the
terms and conditions of the Pooling and Servicing Agreement in its capacity as
an owner of a
<PAGE> 361
Certificate or Certificates, as the case may be (each, a "Certificateholder"),
in all respects as if it were a signatory thereto. This undertaking is made for
the benefit of the Trust, the Certificate Registrar and all Certificateholders
present and future.
6. The Purchaser will not sell or otherwise transfer any
portion of the Certificate, except in compliance with Section 5.2 of the Pooling
and Servicing Agreement.
Please make all payments due on the Certificates: *
__________ (a) by wire transfer to the following account at a bank
or entity in New York, New York, having appropriate facilities
therefore:
Account number ___________ Institution _______________
_________ (b) by mailing a check or draft to the following address:
----------------------------------
----------------------------------
----------------------------------
Very truly yours,
----------------------------------
[The Purchaser]
By: __________________________
Name:
Title:
- ----------------------------------
* Please select (a) or (b). Wire transfers are only available if such
holder's Certificates have an aggregate Certificate Balance or Notional Balance
of at least U.S. $5,000,000.
<PAGE> 362
EXHIBIT D-2
FORM OF ERISA REPRESENTATION LETTER
--------------, ----
LaSalle National Bank, as Trustee
and Certificate Registrar
135 South LaSalle Street
Suite 200
Chicago, Illinois 60603
Attention: Corporate Trust Administration
Prudential Securities Secured Financing Corporation
One New York Plaza
New York, New York 10292
Re: Prudential Securities Secured Financing Corporation,
Commercial Mortgage Pass-Through Certificates, Series
1995-MCF-2, Class
------------------------------------
Ladies and Gentlemen:
_____________________________ (the "Purchaser") intends to
purchase from (the "Seller") $___________ initial Certificate Balance or ___%
Percentage Interest of Prudential Securities Secured Financing Corporation,
Commercial Mortgage Pass-Through Certificates, Series 1995-MCF-2, Class ___
<PAGE> 363
(the "Certificates"), issued pursuant to the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement") dated as of December 1, 1995, by and
among Prudential Securities Secured Financing Corporation, as depositor (the
"Depositor"), Midland Loan Services, L.P., as servicer, Lennar Partners, Inc.,
as servicer, LaSalle National Bank, as trustee (the "Trustee"), and ABN AMRO
Bank N.V., as fiscal agent (the "Fiscal Agent"). All capitalized terms used
herein and not otherwise defined shall have the meaning set forth in the Pooling
and Servicing Agreement. The Purchaser hereby certifies, represents and warrants
to, and covenants with, the Depositor, the Certificate Registrar and the Trustee
that:
1. Subject to paragraph 2 below, the Purchaser is neither (a)
an employee benefit plan or other retirement arrangement, including an
individual retirement account or a Keogh plan, which is subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), Section 4975 of
the Code, or any essentially similar Federal, State or local law (a "Similar
Law") (each, a "Plan"), nor (b) a collective investment fund in which such Plans
are invested, an insurance company using assets of separate accounts or general
accounts which include assets of Plans (or which are deemed pursuant to ERISA or
any Similar Law to include assets of Plans) other than an insurance company
using assets of its general account in circumstances whereby the purchase or
transfer and subsequent holding of the Certificates would not result in a
prohibited transaction under Section 406 or 407 of ERISA, Section 4975 of the
Code, or any Similar Law, nor (c) any other person acting on behalf of any such
Plan or using the assets of any such Plan.
D-2-2
<PAGE> 364
2. The Purchaser understands that if the Purchaser is a person
referred to in l(a), l(b) or 1(c) above, such Purchaser is required to provide
to the Depositor, the Trustee and the Certificate Registrar an Opinion of
Counsel which establishes to the satisfaction of the Depositor, the Trustee and
the Certificate Registrar that the purchase or holding of the Certificates will
not result in the assets of the Trust Fund being deemed to be "plan assets" and
subject to the fiduciary responsibility provisions of ERISA or the prohibited
transaction provisions of the Code, will not constitute or result in a
prohibited transaction within the meaning of Section 406 or Section 407 of ERISA
or Section 4975 of the Code, and will not subject the Servicer, the Depositor,
the Trustee or the Certificate Registrar to any obligation or liability
(including obligations or liabilities under ERISA or Section 4975 of the Code),
which Opinion of Counsel shall not be at the expense of the Servicer, the
Depositor, the Trustee or the Certificate Registrar. The Purchaser further
understands that if the Purchaser is a person referred to in l(a), l(b) or 1(c)
above, the Certificate Registrar shall not register the transfer of any Class R
or Class LR Certificates.
[Signature on next page]
D-2-3
<PAGE> 365
IN WITNESS WHEREOF, the Purchaser hereby executes the ERISA
Representation Letter on ___________________, ____.
Very truly yours,
----------------------------------
By: ________________________
Name:
Title:
D-2-4
<PAGE> 366
EXHIBIT E
FORM OF REQUEST FOR RELEASE
(FOR TRUSTEE/CUSTODIAN)
Loan Information
Name of Mortgagor: ____________________________
Servicer
Loan No.: ____________________________
Custodian/Trustee
Name: ____________________________
Address: ____________________________
____________________________
Custodian/Trustee
Mortgage File No.: ____________________________
Depositor
Name: ____________________________
Address: ____________________________
____________________________
Certificates: Prudential Securities Secured
Financing Corporation, Commercial
Mortgage Pass-Through
Certificates, Series
1995-MCF-2
The undersigned Servicer hereby acknowledges that it has
received from LaSalle National Bank, as Trustee for the Holders of Prudential
Securities Secured Financing Corporation, Commercial Mortgage Pass-Through
Certificates, Series 1995-MCF-2, the documents referred to below (the
"Documents") . All capitalized terms of not otherwise defined in this Request
for Release shall have the meanings given them in the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement") dated as of December 1, 1995,
by and among the Trustee, ABN AMRO Bank N.V., as fiscal agent, Prudential
Securities Secured Financing Corporation, as depositor, Midland Loan Services,
L.P., as servicer, and Lennar Partners, Inc., as special servicer.
<PAGE> 367
( ) Promissory Note dated ___________, 199_, in the original principal sum
of $_________________, made by _______________, payable to, or
endorsed to the order of, the Trustee.
( ) Mortgage recorded on _________________ as instrument no.
________________ in the County Recorder's Office of the County of
___________________, State of__________________ in book/reel/docket
________________ of official records at page/image __________________.
( ) Deed of Trust recorded on ____________________ as instrument no.
____________ in the County Recorder's Office of the County of
_________________, State of ________________ in book/reel/docket
____________________ of official records at page/image ______________.
( ) Assignment of Mortgage or Deed of Trust to the Trustee, recorded on
_________________________ as instrument no. ____________________ in
the County Recorder's Office of the County of _________________, State
of _______________________ in book/reel/docket __________ of official
records at page/image ____________________.
( ) Other documents, including any amendments, assignments or other
assumptions of the Note or Mortgage.
( ) ----------------------------------
( ) ----------------------------------
( ) ----------------------------------
( ) ----------------------------------
The undersigned Servicer hereby acknowledges and agrees as
follows:
(1) The Servicer shall hold and retain possession of the
Documents in trust for the benefit of the Trustee,
solely for the purposes provided in the Agreement.
(2) The Servicer shall not cause or permit the Documents
to become subject to, or encumbered by, any claim,
liens, security interest, charges, writs of attachment
or other impositions nor shall the Servicer assert or
seek to assert any claims or rights of set-off to or
against the Documents or any proceeds thereof.
(3) The Servicer shall return the Documents to the
Custodian when the need therefor no longer exists,
unless the Mortgage Loan relating to the Documents has
been liquidated and the proceeds thereof have been
<PAGE> 368
remitted to the Collection Account and except as
expressly provided in the Agreement.
(4) The Documents and any proceeds thereof, including any
proceeds of proceeds, coming into the possession or
control of the Servicer shall at all times be
earmarked for the account of the Trustee, and the
Servicer shall keep the Documents and any proceeds
separate and distinct from all other property in the
Servicer's possession, custody or control.
[SERVICER]
By: _______________________
Title: _______________________
Date: ___________________, 19__
<PAGE> 369
CUSTODIAL AGREEMENT
THIS CUSTODIAL AGREEMENT, dated as of December __, 1995, by and
among LaSalle National Bank as Custodian (the "Custodian"), Midland Loan
Services, L.P., as Servicer (the "Servicer"), and LaSalle National Bank, as
Trustee (the "Trustee").
WITNESSETH:
WHEREAS, the Servicer and the Trustee are parties to a Pooling
and Servicing Agreement (the "Pooling and Servicing Agreement"), dated as of
December 1, 1995, among Prudential Securities Secured Financing Corporation, as
Depositor, the Servicer and the Trustee, relating to Commercial Mortgage
Pass-Through Certificates, Series 1995-MCF-2 (capitalized terms used but not
defined herein having the meaning assigned thereto in the Pooling and Servicing
Agreement).
WHEREAS, the parties hereto desire the Custodian to take
possession of the documents specified in Section 2.1 of the Pooling and
Servicing Agreement, as custodian for the Trustee, in accordance with the terms
hereof;
NOW, THEREFORE, in consideration of the mutual undertakings
herein expressed, the parties hereto hereby agree as follows:
1. The Trustee hereby certifies that it has caused to be
delivered and released to the Custodian and the Custodian hereby acknowledges
receipt of the documents specified in Section 2.1 of the Pooling and Servicing
Agreement pertaining to each of the Mortgage Loans identified in the Mortgage
Loan Schedule attached to the Pooling and Servicing Agreement as Exhibit B. From
time to time, the Servicer shall forward to the Custodian additional original
documents evidencing an assumption or modification of a Mortgage Loan approved
by the Servicer. All Mortgage Loan documents held by the Custodian as to each
Mortgage Loan are referred to herein as the "Custodian's Mortgage File." The
Custodian hereby agrees to review each of the Custodian's Mortgage Files and
perform such other obligations of the Custodian as such obligations are set
forth in the Pooling and Servicing Agreement (including Sections 2.1 and 2.2
thereof).
2. With respect to each Note, each Mortgage, each Assignment of
Mortgage and each other document constituting each Custodian's Mortgage File
which is delivered to the Custodian or which at any time comes into the
possession of the Custodian, the Custodian is exclusively the custodian for and
the bailee of the Trustee or the Servicer. The Custodian shall hold all
documents constituting each Custodian's Mortgage File received by it for the
exclusive use and benefit of the Trustee, and shall make disposition thereof
only in accordance with the instructions furnished by the Servicer. The
Custodian shall segregate and maintain continuous custody of all documents
constituting the Custodian's Mortgage File received in secure and fire resistant
facilities located in the State of __________ in accordance with customary
standards for such custody. In the event the Custodian discovers
<PAGE> 370
any defect with respect to any Custodian's Mortgage File, the Custodian shall
give written specification of such defect to the Servicer and the Trustee.
3. From time to time and as appropriate for the foreclosure or
servicing of any of the Mortgage Loans, the Custodian is hereby directed, upon
written request and receipt from the Servicer (a copy of which shall be
forwarded to the Trustee), to release to the Servicer the related Custodian's
Mortgage File or the documents set forth in such receipt to the Servicer. All
documents so released to the Servicer shall be held by it in trust for the
benefit of the Trustee. The Servicer shall return to the Custodian the
Custodian's Mortgage File or such documents when the Servicer's need therefor in
connection with such foreclosure or servicing no longer exists, unless the
Mortgage Loan shall be liquidated, in which case, upon receipt of a
certification to this effect from the Servicer to the Custodian, the Servicer's
receipt shall be released by the Custodian to the Servicer.
4. Upon the purchase of any Mortgage Loan pursuant to the terms
of the Pooling and Servicing Agreement or the payment in full of any Mortgage
Loan, and upon receipt by the Custodian of the Servicer's request for release,
receipt and certification (which certification shall include a statement to the
effect that all amounts received in connection with such payment or repurchase
have been credited to the Collection Account or Distribution Account as provided
in the Pooling and Servicing Agreement), the Custodian shall promptly release
the related Custodian's Mortgage File to the Servicer.
5. It is understood that the Custodian will charge such fees
for its services under this Agreement as are set forth in a separate agreement
between the Custodian and the Servicer, the payment of which, together with the
Custodian's expenses in connection therewith, shall be solely the obligation of
the Servicer.
6. The Trustee may upon 30 days written days notice (with copy
to the Servicer) remove and discharge the Custodian or any successor Custodian
thereafter appointed from the performance of its duties under this Custodial
Agreement. Simultaneously, the Trustee shall appoint a successor Custodian to
act on its behalf by written instrument, one original counterpart of which
instrument shall be delivered to each Rating Agency, one copy to the Servicer
and one copy to the successor Custodian. In the event of any such removal, the
Custodian shall promptly transfer to the successor Custodian, as directed, all
Custodian's Mortgage Files being administered under this Custodial Agreement.
Notwithstanding the foregoing, so long as Midland Loan Services, L.P. is
Servicer, the Trustee shall not have a right to remove the Custodian.
7. Upon reasonable prior written notice to the Custodian, the
Trustee and its agents, accountants, attorneys and auditors will be permitted
during normal business hours to examine the Custodian's Mortgage File,
documents, records and other papers in the possession of or under the control of
the Custodian relating to any or all of the Mortgage Loans.
8. If the Custodian is furnished with written notice
from the Trustee or the Servicer that the Pooling and Servicing Agreement has
been terminated as to any or all of the
<PAGE> 371
Mortgage Loans, it shall upon written request of the Trustee or the Servicer
release to such persons as the Trustee or the Servicer shall designate the
Custodian's Mortgage Files relating to such Mortgage Loans as the Trustee or the
Servicer shall request and shall complete the Assignments of Mortgage and
endorse the Notes only as, and if, the Trustee or the Servicer shall request.
The person making such written request shall send notice of such request to all
other parties to the Pooling and Servicing Agreement.
9. The Custodian shall, at its own expense, maintain at all
times during the existence of this Custodial Agreement and keep in full force
and effect (a) fidelity insurance, (b) theft of documents insurance, (c) forgery
insurance and (d) errors and omissions insurance. All such insurance shall be in
amounts, with standard coverage and subject to deductibles, as are customary for
insurance typically maintained by banks which act as custodian in similar
transactions provided, however, that so long as the Custodian is rated at least
"AA" no such insurance shall be required.
10. This Custodial 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 and be one and the same
instrument.
11. Within 10 days of each anniversary of the date of this
Custodial Agreement, or upon the request of the Trustee or the Servicer at any
other time, the Custodian shall provide to the Trustee and the Servicer a list
of all the Mortgage Loans for which the Custodian holds a Custodian's Mortgage
File pursuant to this Custodial Agreement. Such list may be in the form of a
copy of the Mortgage Loan Schedule with manual deletions to specifically denote
any Mortgage Loans paid off, liquidated or repurchased since the date of this
Custodial Agreement.
12. THIS CUSTODIAL AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
13. By execution of this Custodial Agreement, the Custodian
warrants that it currently does not hold and during the existence of this
Custodial Agreement shall not hold any adverse interest, by way of security or
otherwise, in any Mortgage Loan, and hereby waives and releases any such
interest which it may have in any Mortgage Loan as of the date hereof.
14. The Custodian may terminate its obligations under this
Custodial Agreement upon at least 60 days notice to the Trustee and the
Servicer, provided that so long as Midland Loan Services, L.P. is the Servicer,
Midland Loan Services, L.P. will not resign from its duties hereunder. In the
event of such termination, the Trustee shall appoint a successor Custodian. Upon
such appointment, the Custodian shall promptly transfer to the successor
Custodian, as directed, all Custodian's Mortgage Files being administered under
this Custodial Agreement.
<PAGE> 372
15. This Custodial Agreement shall terminate upon the final
payment or other liquidation (or advance with respect thereto) of the last
Mortgage Loan or the disposition of all property acquired upon foreclosure or
deed in lieu of foreclosure of any Mortgage Loan, and the final remittance of
all funds due the Certificateholders under the Pooling and Servicing Agreement.
In such event, all documents remaining in the Custodian's Mortgage Files shall
be forwarded to the Trustee.
16. All demands, notices and communications hereunder shall be
in writing and shall be deemed to have been duly given when received by the
addressee. Any such demand, notice or communication hereunder shall be deemed to
have been received on the date delivered to or received at the premises of the
addressee (as evidenced, in the case of registered or certified mail, by the
date noted on the return receipt).
17. The Servicer shall indemnify, defend, and hold
harmless the Custodian for any actions taken by the Custodian at its written
request.
[Signatures on Next Page]
<PAGE> 373
IN WITNESS WHEREOF, the Custodian, the Servicer and
the Trustee have caused their names to be signed hereto by their respective
officers thereunto duly authorized, all as of the date first written above.
LASALLE NATIONAL BANK
as Custodian
By: ______________________________
Name: ______________________________
Title: ______________________________
MIDLAND LOAN SERVICES, L.P.
as Servicer
By: Midland Data Services, Inc.,
its General Partner
By: ________________________
Name: ________________________
Title: ________________________
LASALLE NATIONAL BANK,
as Trustee
By: ______________________________
Name: ______________________________
Title: ______________________________
<PAGE> 374
EXHIBIT G
MORTGAGE LOAN PURCHASE AND SALE AGREEMENT
THIS MORTGAGE LOAN PURCHASE AND SALE AGREEMENT (this
"Agreement") dated as of December 22, 1995, is among Prudential Securities
Secured Financing Corporation, a Delaware corporation (the "Company"),
Midland Commercial Financing Corp., a Missouri corporation (the "Seller"),
and Midland Loan Services, L.P. ("Midland").
The Seller intends to sell, assign and transfer to the
Company, subject to the terms and conditions set forth below, certain "whole"
mortgage loans (the "Whole Loans") and a certain participation interest (the
"Seaport Participation Interest"; together with the Whole Loans, the
"Mortgage Loans") representing a 49.3% undivided ownership interest in a
"whole" mortgage loan (such "whole" mortgage loan, the "Seaport Loan").
The Whole Loans are described in, and set forth in, the mortgage loan schedule
(the "Mortgage Loan Schedule") attached as Exhibit B to the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement") dated as of
December 1, 1995 among the Company, Midland, as servicer, Lennar Partners,
Inc., as special servicer (the "Special Servicer"), LaSalle National Bank, as
trustee (in such capacity, the "Trustee"), and ABN AMRO Bank N.V., as fiscal
agent (the "Fiscal Agent"). The Seaport Loan is described in, and set forth
in, the Seaport Participation Agreement (defined below). Seventy-seven of the
Whole Loans (the "Midland Mortgage Loans") were purchased by the Seller from
Midland pursuant to a Master Mortgage Loan Purchase Agreement (the "Master
Mortgage Loan Purchase Agreement") dated as of June 22, 1994, as amended,
between Midland and the Seller. Seven of the Whole Loans (the "ULLICO
Mortgage Loans") were purchased by the Seller from The Union Labor Life
Insurance Company ("ULLICO") pursuant to a Mortgage Loan Purchase and Sale
Agreement (the "ULLICO Mortgage Loan Purchase Agreement") dated December 4,
1995 between ULLICO and the Seller. The Seaport Loan is being serviced, and
the Seaport Participation Interest was created, pursuant to a Participation and
Servicing Agreement (the "Seaport Participation Agreement") dated as of
December 1, 1995 among LaSalle National Bank, as trustee (in such capacity, the
"Seaport Trustee") and the Seller, as participant. The Seaport Participation
Interest is represented by a participation certificate (the "Seaport
Participation Certificate") dated December 1, 1995 issued by the Seaport
Trustee.
The Company intends to deposit the Mortgage Loans into a trust
fund (the "Trust Fund"), beneficial ownership of which will be evidenced by a
series of mortgage pass-through certificates (the "Certificates"). The Trust
Fund will be created and the Certificates will be issued pursuant to the
Pooling and Servicing Agreement. The Company intends to sell certain of the
Certificates (the "Privately Placed Certificates") to Prudential Securities
Incorporated (in such capacity, the "Placement Agent") on the Closing Date
(defined below) pursuant to a Certificate Purchase Agreement (the "Certificate
Purchase Agreement") dated December 22, 1995. The Company intends to sell
certain of the Certificates (the "Publicly Offered Certificates") to
Prudential Securities Incorporated (in such capacity, the "Underwriter") on
the Closing Date pursuant to an underwriting agreement (the "Underwriting
Agreement") dated
1
<PAGE> 375
December 22, 1995. Capitalized terms used but not otherwise defined herein
shall have the respective meanings ascribed to such terms in the Pooling and
Servicing Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals,
which are incorporated into the operative provisions of this Agreement by this
reference, and for other good and valuable consideration, the receipt and
adequacy of which are hereby conclusively acknowledged, the parties hereto
hereby agree as follows:
1. Purchase Price; Purchase and Sale. The purchase price (the
"Purchase Price") for the Mortgage Loans shall be equal to $223,888,915.77
($222,768,809.99 of which represents principal and $1,120,105.78 of which
represents interest) payable by the Company to the Seller on December 22, 1995
(the "Closing Date") (except as provided below) in immediately available
funds. The closing for the purchase and sale of the Mortgage Loans shall take
place at the offices of O'Melveny & Myers, New York, New York, at 10:00 a.m. New
York time, on the Closing Date.
On the Closing Date, the Company shall pay the Purchase Price
to the Seller. As of the Closing Date, the Seller hereby sells, transfers,
assigns, sets over and otherwise conveys to the Company all the right, title
and interest of the Seller in and to the Mortgage Loans, including: (i) all
scheduled payments of interest and principal due on or with respect to the
Mortgage Loans after December 1, 1995 (or, with respect to Mortgage Loan Nos.
94-0903231 and 94-0903232, after December 4, 1995 and, with respect to Mortgage
Loan Nos. 94-0900581, 94-0902096 and 94-0902526, after December 6, 1995) (the
"Cut-off Date") (whether or not received); (ii) all other payments of
interest and principal received by the Seller on or with respect to the
Mortgage Loans after the Cut-off Date, other than any such payments of interest
or principal which were due on or prior to the Cut-Off Date; and (iii) all of
the Seller's right, title and interest in and to the proceeds of any related
title, hazard or other insurance policies received by the Seller on or with
respect to the Mortgage Loans after the Cut-off Date.
In connection with the transfer and assignment described in
the preceding paragraph, the Seller shall pay to the Company an amount equal to
the Cash Deposit. The Company hereby directs the Seller, and the Seller hereby
agrees, to deliver to the Trustee all documents, instruments and agreements
required to be delivered by the Company to the Trustee under the Pooling and
Servicing Agreement and such other documents, instruments and agreements as the
Company or the Trustee shall reasonably request. In connection with the
Seller's delivery of the mortgage documents with respect to the Mortgage Loans
in accordance with the preceding sentence, the Seller hereby authorizes the
Company or its designee to complete each endorsement or assignment in blank
appearing thereon in such manner as the Company or such designee shall
determine in the exercise of its sole discretion.
2. Representations and Warranties. (a) The Seller hereby
represents and warrants to the Company as of the Closing Date that:
(i) Due Organization; Qualification. The Seller is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Missouri, and is duly qualified to transact business as
a foreign corporation, in good standing and
2
<PAGE> 376
licensed in each state to the extent necessary to ensure the enforceability
of each Mortgage Loan and the assignment thereof to the Company as herein
provided and to perform its duties and obligations under this Agreement.
(ii) Authority. The Seller has the full power, authority
and legal right to hold, transfer and convey each Mortgage Loan and its
rights in and to the Seaport Participation Interest and to execute and
deliver this Agreement and the Seaport Participation Agreement (and all
agreements executed and delivered by the Seller in connection herewith and
therewith) and to perform all transactions contemplated by this Agreement
(and all agreements executed and delivered by the Seller in connection
herewith). The Seller has duly authorized the execution, delivery and
performance of this Agreement (and all agreements executed and delivered by
the Seller in connection herewith), and has duly executed and delivered this
Agreement (and all agreements executed and delivered by the Seller in
connection herewith). This Agreement (and each agreement executed and
delivered by the Seller in connection herewith) constitutes the legal, valid
and binding obligation of the Seller enforceable in accordance with its
terms, except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other laws relating to or
affecting the rights of creditors generally and by general principles of
equity (regardless of whether such enforcement is considered in a proceeding
in equity or at law).
(iii) No Conflicts. Neither the execution and delivery of
this Agreement or the Seaport Participation Agreement, nor the fulfillment
of or compliance with the terms and conditions of this Agreement by the
Seller, will (a) conflict with or result in a breach of any of the terms,
conditions or provisions of the Seller's certificate of incorporation, as
amended, or other organization documents or any agreement or instrument to
which the Seller is now a party or by which it (or any of its properties) is
bound, or constitute a default or result in an acceleration under any of the
foregoing; (b) conflict with or result in a breach of any legal restriction
if compliance therewith is necessary (1) to ensure the enforceability of
this Agreement or any Mortgage Loan or (2) for the Seller to perform its
obligations under this Agreement in accordance with the terms hereof; (c)
result in the violation of any law, rule, regulation, order, judgment or
decree to which Seller or its property is subject if compliance therewith is
necessary (1) to ensure the enforceability of this Agreement or any Mortgage
Loan or (2) for the Seller to perform its obligations under this Agreement
in accordance with the terms hereof; or (d) result in the creation or
imposition of any lien, charge or encumbrance that would have a material
adverse effect upon any of its properties pursuant to the terms of any
mortgage, contract, deed of trust or other instrument, or materially impair
the ability of the Company to realize on the Mortgage Loans.
(iv) Solvency. The Seller is solvent and the sale of the
Mortgage Loans (1) will not cause the Seller to become insolvent and (2) is
not intended by the Seller to hinder, delay or defraud any of its creditors.
(v) No Consent Required. No consent, approval,
authorization or order of, or registration or filing with, or notice to, any
court or governmental agency
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or body having jurisdiction or regulatory authority over the Seller is
required for (a) the Seller's execution and delivery of this Agreement (and
each agreement executed and delivered by the Seller in connection herewith),
(b) the Seller's transfer and assignment of the Mortgage Loans, or (c) the
consummation by the Seller of the transactions contemplated by this
Agreement (and each agreement executed and delivered by the Seller in
connection herewith) or, to the extent so required, such consent, approval,
authorization, order, registration, filing or notice has been obtained, made
or given (as applicable), except that the Seller may not be duly qualified
to transact business as a foreign corporation or licensed in one or more
states if such qualification or licensing is not necessary (1) to ensure the
enforceability of any Mortgage Loan or the Seaport Participation Agreement
or (2) for the Seller to perform its obligations under this Agreement in
accordance with the terms hereof.
(vi) Reasonable Purchase Price. The consideration received
by the Seller upon the sale of the Mortgage Loans constitutes fair
consideration and reasonably equivalent value for such Mortgage Loans.
(vii) Ability to Perform. The Seller does not believe, nor
does it have any reason or cause to believe, that it cannot perform each and
every covenant of the Seller contained in this Agreement (or any agreement
executed and delivered by the Seller in connection herewith).
(viii) No Litigation Pending. There is no action, suit or
proceeding pending or to Seller's knowledge threatened against the Seller or
any of its Affiliates which, either in any one instance or in the aggregate,
may result in any material adverse change in the business, operations, or
financial condition of the Seller or which would draw into question the
validity of this Agreement or which would be likely to impair materially the
ability of the Seller to perform its duties and obligations under the terms
of this Agreement (or any agreement executed and delivered by the Seller in
connection herewith).
(ix) Ordinary Course of Business. The consummation of the
transactions contemplated by this Agreement (and each agreement executed and
delivered to the Seller in connection herewith) is in the ordinary course of
business of the Seller, and the transfer, assignment and conveyance of the
Notes, the Mortgages and the Seaport Participation Interest by the Seller
pursuant to this Agreement are not subject to the bulk transfer or any
similar statutory provisions in effect in any applicable jurisdiction.
(x) No Brokers. The Seller has not dealt with any Person
(other than Midland, the Company, Prudential Securities Realty Funding
Corporation ("Realty Funding") or the Placement Agent) that may be
entitled, by reason of any act or omission of the Seller, to any commission
or compensation in connection with the sale of the Mortgage Loans to the
Company hereunder.
(b) Midland hereby represents and warrants to the Company as
of the Closing Date that:
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(i) Due Organization; Qualification. Midland is a limited
partnership duly organized, validly existing and in good standing under the
laws of the State of Missouri, and is duly qualified to transact business as
a foreign limited partnership, in good standing and licensed in each state
to the extent necessary to perform its duties and obligations under this
Agreement and the Pooling and Servicing Agreement.
(ii) Financial Statements. Midland has delivered to the
Company financial statements as to its last complete fiscal year ended more
than 90 days prior to the date hereof and any later quarter ended more than
60 days prior to the date hereof. All such financial statements fairly
present the pertinent results of operations and changes in financial
position for each of such periods and the financial position at the end of
each such period of Midland and its subsidiaries, and the financial
statements with respect to Midland's last complete fiscal year have been
prepared in accordance with generally accepted accounting principles
consistently applied, except as set forth in the notes thereto. In
addition, to the extent requested by the Company, Midland has delivered
information as to its aggregate loan gain and loss experience in respect of
foreclosures and its aggregate loan delinquency experience for the
immediately preceding three-year period (or such lesser period as is
reasonably available) commencing not earlier than December 31, 1994, and
ending on the last day of the immediately preceding calendar quarter (unless
prohibited by a valid and binding confidentiality agreement or applicable
law), in each case with respect to the portfolio (or a relevant subset
thereof determined by mutual agreement of Midland and the Company) of
mortgage loans owned by Midland during such period, and all such information
so delivered is true and correct in all material respects. There has been
no change in the business, operations or financial condition of Midland
since the date of Midland's financial statements for its last complete
fiscal year that would have a material adverse effect on its ability to
perform its duties and obligations under this Agreement in accordance with
the terms hereof, except as disclosed by Midland in writing.
(iii) Midland Qualifications. Midland has the facilities,
procedures and experienced personnel necessary to service the Mortgage Loans
under the Pooling and Servicing Agreement in accordance with the terms
thereof.
(c) The Seller (with respect to each of the Mortgage Loans and
the Seaport Loan) and Midland (with respect only to the Midland Mortgage Loans
and the Seaport Loan) hereby represent and warrant that as of the date specified
below or, if no such date is specified, as of the date hereof:
(i) Mortgage Loan Schedule. The information set forth in the
Mortgage Loan Schedule is true, complete and correct in
all material respects.
(ii) Payment Current. All payments required to be made with
respect to such Mortgage Loan under the terms of the related Note or
Mortgage (inclusive of any grace or cure period) up to the Closing Date have
been made. There is currently no delinquency of any payment due from the
related Borrower under such Mortgage Loan in excess of 30 days beyond the
grace or cure period permitted by such Mortgage or
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Note, as applicable, and, since the date of the origination of such Mortgage
Loan, there has not been more than one such delinquency.
(iii) Equity Participation or Participation Interest. Such
Mortgage Loan contains no equity participation by the Seller and, except
with respect to Mortgage Loan No. 94-0900683 (the Seaport Participation
Interest), is a whole loan and not a participation certificate; neither the
related Note nor the related Mortgage provides for any contingent or
additional interest in the form of participation in the cash flow of the
related Mortgaged Property. The indebtedness evidenced by such Note is not
convertible to an ownership interest in such Mortgaged Property (other than
through foreclosure of such Mortgage) or the related Borrower. The Seller
has no ownership interest in such Mortgaged Property or such Borrower other
than in such Mortgage Loan which is being sold and assigned by the Seller
hereunder, and such Borrower is not an Affiliate of the Seller.
(iv) Compliance with Applicable Laws. As of the date of its
origination, such Mortgage Loan (other than the two Mortgage Loans
identified below) either complied with, or was exempt from, applicable state
or federal laws, regulations and other requirements pertaining to usury, and
with respect to each of Mortgage Loan Nos. 94-0900748 and 94- 0902036 (as to
which the related Mortgaged Properties are located in Tennessee), the stated
interest rate of the related Note complied with applicable state or federal
laws, regulations and other requirements pertaining to usury. To the best
of the Seller's and Midland's knowledge, as of the date of origination of
such Mortgage Loan, Midland complied in all material respects with the
requirements of any and all other federal, state or local laws applicable to
the origination, servicing and collection of such Mortgage Loan, including,
without limitation, truth-in-lending, real estate settlement procedures,
equal credit opportunity and disclosure laws.
(v) Servicing and Collection Practices. In connection with
the servicing and collection of such Mortgage Loan, Midland has employed
practices which conform in all material respects to those customarily used
by loan servicers which service commercial mortgage loans for securitization
transactions.
(vi) No Right to Possess or Repurchase the Mortgage Loan. The
Seller intends to relinquish all rights to possess, control and monitor such
Mortgage Loan and, after the Closing Date, the Seller will have no right to
modify or alter the terms of such Mortgage Loan. After the Closing Date, the
Seller will have no obligation or right to repurchase such Mortgage Loan or
substitute another Mortgage Loan, except as provided in Section 3 of this
Agreement.
(vii) Proceeds Fully Disbursed. The proceeds of such Mortgage
Loan have been fully disbursed, and there is no requirement for future
advances thereunder. All costs, fees and expenses incurred in connection
with the origination and closing of such Mortgage Loan, including, without
limitation, recording costs and fees, have been paid to the appropriate
person or arrangements have been made for their payment to the appropriate
person on a timely basis by the related Borrower or Midland. Such
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Borrower is not entitled to any refund of any amounts paid or due under the
related Note or the related Mortgage except for a refund of a cost, fee or
expense related to the origination or closing of such Mortgage Loan which
Midland was obligated to pay, and made arrangements to pay, in full on a
timely basis, and except for disbursements from, or a refund of, the balance
remaining in a Reserve Account held for the Seller to ensure the payment of
anticipated repairs or improvements to the related Mortgaged Property,
leasing commissions, future Monthly Payments and the like when the specific
conditions therefor have been satisfied, and except for a rebate of a
financial and lease reporting fee upon such Borrower's furnishing of certain
financial and leasing information on a timely basis during any applicable
12-month period (and provided no event of default occurs during such period
or thereafter prior to the payment of such rebate) as provided under the
terms of the related Mortgage Loan Documents.
(viii) Documents Valid. Each of the related Note, the related
Mortgage and each other written agreement delivered by or to Midland in
connection therewith is the legal, valid and binding obligation of the
related Borrower, the related guarantor or other party executing such
document, enforceable in accordance with its terms. There is no valid
offset, defense, counterclaim or right of rescission with respect to such
Note, Mortgage or other written agreement, nor will the operation of any of
the terms of such Note or such Mortgage, or the exercise of any right
thereunder, render either such Mortgage or such Note unenforceable or
subject to any valid right of rescission, offset, counterclaim or defense,
including without limitation the defense of usury, and the Seller has no
knowledge that any such right of rescission, offset, counterclaim or defense
has been asserted or is available with respect thereto. Each representation
and warranty of the Seller or Midland set forth in Section 2(a), 2(b) or
2(c) of this Agreement, to the extent related to the enforceability of any
instrument, agreement or other document or as to offsets, defenses,
counterclaims or rights of rescission related to such enforceability,
including, without limitation, the representations set forth above in this
subparagraph (viii), is qualified to the extent that (1) enforcement may be
limited (A) by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally, (B) by general
principles of equity (regardless of whether such enforcement is considered
in a proceeding in equity or at law) and (C) by any applicable
anti-deficiency law or statute; (2) such instrument, agreement or other
document may contain certain provisions which may be unenforceable in
accordance with their terms, in whole or in part, but the unenforceability
of such provisions will not (A) cause the related Note or Mortgage to be
void, (B) invalidate the related Borrower's obligation to pay interest at
the stated interest rate of such Note on, and repay the principal of, the
related Mortgage Loan in accordance with the payment terms of such Note,
such Mortgage and other written agreements delivered to the Seller in
connection therewith, (C) invalidate the obligation of any related guarantor
to pay guaranteed obligations with respect to interest at the stated
interest rate of such Note on, and the principal of, such Mortgage Loan in
accordance with the payment terms of such guarantor's written guaranty, (D)
impair the mortgagee's right to accelerate and demand payment of the
interest at the stated interest rate of such Note on, and principal of, such
Mortgage Loan upon the occurrence of a legally enforceable default or (E)
impair the mortgagee's right to realize against such Mortgaged Property by
judicial or, if applicable,
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nonjudicial foreclosure; and (3) with respect to each of Mortgage Loan Nos.
94-0900748 and 94-0902036, each representation and warranty that there is no
valid offset, defense, counterclaim or right of rescission as it relates to
a claim of usury is limited to a representation and warranty that there is
no valid offset, defense, counterclaim or right of rescission solely on the
basis that stated interest rate of the related Note is usurious.
(ix) Assignment of Mortgage; Note Endorsement. The related
Assignment of Mortgage (but for the insertion of the name of the assignee
and any related recording information which is not yet available to the
Seller) is in recordable form and constitutes the Seller's legal, valid and
binding assignment to the Company of the related Mortgage and the related
Assignment of Leases, Rents and Profits. The Seller's endorsement (or in
the case of the seven Mortgage Loans originated by ULLICO, ULLICO's
endorsement) and delivery of the related Note to the Company in accordance
with the terms of this Agreement constitutes the Seller's legal, valid and
binding assignment to the Company of such Note, and together with the
Seller's execution and delivery of such Assignment of Mortgage to the
Company, legally and validly conveys all right, title and interest of the
Seller in such Mortgage Loan to the Company.
(x) First Lien. The related Mortgage is a valid, subsisting
and enforceable first lien on the related Mortgaged Property (including all
buildings and improvements on such Mortgaged Property and all installations
and mechanical, electrical, plumbing, heating and air conditioning systems
located in or annexed to such buildings, and all additions, alterations and
replacements made at any time prior to the closing date of such Mortgage
Loan with respect to the foregoing, but excluding any related personal
property, which Mortgaged Property is free and clear of all encumbrances and
liens having priority over the first lien of such Mortgage, except for (1)
liens for real estate taxes and special assessments not yet due and payable,
(2) covenants, conditions and restrictions, rights of way, easements and
other matters of public record as of the date of recording of such Mortgage
which do not materially and adversely (A) affect the value of such Mortgaged
Property as security for such Mortgage Loan or (B) interfere with the
related Borrower's ability to make required principal and interest payments
or use of such Mortgaged Property for the intended purposes therefor, (3)
leases and subleases pertaining to such Mortgaged Property which Midland, in
accordance with Midland's customary underwriting and closing requirements
and procedures as in effect at the time of origination, did not require to
be subordinated to the lien of such Mortgage and (4) other matters to which
like properties are commonly subject which do not, individually or in the
aggregate, materially interfere with the related Borrower's ability to make
required principal and interest payments or make use of such Mortgaged
Property for the intended purposes therefor. Any security agreement,
chattel mortgage or equivalent document related to and delivered in
connection with such Mortgage Loan establishes and creates a valid,
subsisting and enforceable lien on and a security interest in the property
described therein, and the Seller has full right to sell and assign the same
to the Company.
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(xi) No Modification, Release or Satisfaction. Neither the
related Mortgage nor the related Note has been impaired, waived, modified,
altered, satisfied, canceled or subordinated or rescinded, and the related
Mortgaged Property has not been released from the lien of such Mortgage and
the related Borrower has not been released from its obligations under such
Mortgage, in whole or in any part, in each such event in a manner which
would materially interfere with the benefits of the security intended to be
provided by such Mortgage. No instrument has been executed that would
effect any such waiver, modification, alteration, satisfaction,
cancellation, subordination, rescission or release, with the exception of
the written instruments (1) which are a part of the related Mortgage File
and (2) which have been recorded if necessary to protect the interests of
the Seller.
(xii) No Taxes or Assessments. All taxes and governmental
assessments, or if payable in installments, the installment thereof, which
became due and owing prior to the Closing Date in respect of the related
Mortgaged Property (excluding any related personal property) and which, if
left unpaid, would be, or might become, a lien on such Mortgaged Property
having priority over the related Mortgage, have been paid, or an escrow of
funds in an amount sufficient to cover such taxes and assessments has been
established.
(xiii) Escrow Deposits. All escrow deposits and other escrow
payments required under the related Note, the related Mortgage and any other
Mortgage Loan Documents executed in connection with the origination of such
Mortgage Loan to be paid prior to the Closing Date have been paid to, and
are in the possession, or under the control, of, or have been applied in
accordance with their intended purposes by, the Seller or its agent.
(xiv) No Buydowns or Third Party Advances. The Seller has not,
directly or indirectly, advanced funds, induced or solicited any payment
from a Person other than the related Borrower, or, to the best of the
Seller's or Midland's knowledge, received any payment from a Person other
than such Borrower, for the payment of any amount required under the related
Note or the related Mortgage, except for interest accruing from the date of
such Note or the date of disbursement of the proceeds of such Mortgage Loan,
whichever is later, to the date which precedes by 30 days the first due date
under such Note. The related Mortgage Loan Documents contain no provisions
pursuant to which Monthly Payments are (1) paid or partially paid prior to
an event of default thereunder with funds deposited in any separate account
established by the Seller, such Borrower, or anyone on behalf of such
Borrower, except (A) with respect to Mortgage Loan Nos. 94-0900507,
94-0900581, 94-0900776, 94-0901753, 94-0902139 and 94-0902140 escrow
accounts held by the Seller and funded by the deposit of all rentals paid by
the tenants of the related Mortgaged Properties from which the Seller is
paid all payments due and owing under the related Mortgaged Loan Documents,
and (B) with respect to Mortgage Loan Nos. 94-0900904, 94-0901831, 94-
0901855 and 94-0903262 escrow accounts held by the Seller to ensure the
related Borrower's compliance with certain requirements related to future
leases of the related Mortgaged Property, or (2) paid by any source other
than such Borrower except (A) provisions pertaining to a
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related guarantor's obligations under the terms of such guarantor's written
guaranty and (B) with respect to Mortgage Loan Nos. 94-0900581, 94-0901138,
94-0902096 (as to which each related Borrower has delivered a letter of
credit to ensure satisfactory reletting of certain leased space) and
94-0903262 (as to which the related Borrower has delivered a letter of
credit to ensure the satisfactory renewal of certain leases), and such
Mortgage Loan Documents contain no similar provision which may constitute a
"buydown" provision. Such Mortgage Loan is not a graduated payment
mortgage loan, except with respect to Mortgage Loan No. 94-0903265 and
Mortgage Loan No. 94-0901028, each of which provides for the Monthly Payment
to increase on a specified Due Date prior to maturity.
(xv) No Condemnation or Damages. To the best of the Seller's
or Midland's knowledge, no proceedings for the total or partial condemnation
of the related Mortgaged Property (1) have occurred since the date as of
which the appraisal of such Mortgaged Property contained in the related
Mortgage File was prepared or (2) are pending or threatened other than, in
each such case, proceedings as to partial condemnation which (A) are
specifically addressed by the appraiser in the determination of the
appraised value thereof in such appraisal (the " Appraised Value") or (B)
which do not materially and adversely affect the value of such Mortgaged
Property as security for such Mortgage Loan. To the best of the Seller's and
Midland's knowledge, such Mortgaged Property is being used for the
purpose(s) set forth in the letter executed by Midland and the related
Borrower (or an Affiliate thereof) setting forth the terms and conditions
upon which Midland agreed to originate such Mortgage Loan (the "Commitment
Letter") and is in good repair and free of any damage, waste or defective
condition that would materially and adversely affect the value of such
Mortgaged Property as security for such Mortgage Loan or the use for which
such Mortgaged Property was intended at the time of origination of such
Mortgage Loan.
(xvi) No Mechanics' Liens. The related Mortgaged Property
(excluding any related personal property) is free and clear of any
mechanics' and materialmen's liens or liens in the nature thereof, and no
rights are outstanding that, under law, could give rise to any such liens,
any of which liens are or may be prior to, or equal with, the lien of the
related Mortgage, except those which are insured against by the related
lender's title insurance policy referred to in subparagraph (xxi) below.
(xvii) Title Survey; Improvements. (1) The related Mortgage
File includes an ALTA/ACSM Land Title Survey with respect to the related
Mortgaged Property, or (2) if an ALTA/ACSM Land Title Survey was not
available or as otherwise approved in writing by the Seller or the
Originator, such Mortgage File includes an as-built survey, a survey
recertification, a site plan, a recorded plat or the like with respect to
such Mortgaged Property which satisfied, or Midland otherwise satisfied, the
requirements of the related title insurance company for deletion of the
standard general exceptions for encroachments, boundary and other survey
matters and for easements not shown by the public records from the related
title insurance policy, except that with respect to any of the Mortgage
Properties located in the State of Texas, the exception for easements not
shown by the public records could not be deleted, and is customarily
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accepted by prudent commercial mortgage lenders in such jurisdiction. Except
for encroachments and similar matters which do not materially and adversely
affect the value of such Mortgaged Property as security for such Mortgage
Loan, (i) none of the improvements which were included for the purpose of
determining the Appraised Value of such Mortgaged Property at the time of
the origination of such Mortgage Loan lies outside the boundaries and
building restriction lines of such Mortgaged Property, and (ii) no
improvements on adjoining properties materially encroach upon such Mortgaged
Property so as to materially and adversely affect the value of such
Mortgaged Property as security for such Mortgage Loan. To the best of the
Seller's and Midland's knowledge (based upon a representation of the related
Borrower, zoning letter, legal opinion, zoning endorsement to the related
title insurance policy or other information acceptable to Midland at the
time of origination of such Mortgage Loan), no improvements located on or
forming a part of such Mortgaged Property are in violation of any applicable
zoning and building laws or ordinances which violations would materially and
adversely affect the value of such Mortgaged Property as security for such
Mortgage Loan.
(xviii) Mortgage Files. The related Mortgage File contains the
agreements, instruments and documents described in Section 2.1 of the
Pooling and Servicing Agreement.
(xix) Title. The Seller is the sole owner and beneficial
holder of such Mortgage Loan, has full right and authority to sell and
assign such Mortgage Loan hereunder, is the sole mortgagee or beneficiary of
record under the related Mortgage (except that until the related Assignment
of Mortgage is completed in favor of the Trustee or its designee and is
filed for record, ULLICO will be the mortgagee or beneficiary of record with
respect to the seven Mortgage Loans originated by ULLICO) and is
transferring such Mortgage Loan to the Company free and clear of any and all
liens, encumbrances, participation interests, pledges, charges or security
interests of any nature encumbering such Mortgage Loan.
(xx) Compliance with Laws. To the best of the Seller's and
Midland's knowledge (based upon a representation or opinion either (a)
obtained from the related Borrower at the time of origination of such
Mortgage Loan, or (b) obtained from ULLICO at the time of the purchase of
the ULLICO Mortgage Loans), (1) the related Mortgaged Property complies, in
all material respects, with all laws and regulations pertaining to the use
and occupancy thereof, other than applicable zoning and building laws and
regulations (addressed in subparagraph (xvii) above) and Environmental Laws
(as defined and addressed in subparagraphs (xlii) and (xliii) below) and all
applicable insurance requirements, except for such non-compliance for which
a Reserve Account held for the Seller has been established in an amount
sufficient to pay for the estimated costs to correct such non-compliance and
(2) such Borrower has obtained all inspections, licenses, permits,
authorizations, and certificates necessary for such compliance, including
but not limited to certificates of occupancy. The Seller has not received
notification from any governmental authority that such Mortgaged Property is
in material non-compliance with such laws or regulations, is being used,
operated or occupied
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unlawfully or has failed to have or obtain such inspections, licenses or
certificates, as the case may be.
(xxi) Title Insurance. The related Mortgaged Property
(excluding any related personal property) is covered by an ALTA lender's
title insurance policy or, if an ALTA lender's title insurance policy is
unavailable, another state-approved form of lender's title insurance policy
issued by an insurance company in an amount not less than the stated
original principal amount of such Mortgage Loan insuring that the related
Mortgage is a valid first lien on such Mortgaged Property, subject only to
exceptions described in subparagraph (x) above. Such title insurance policy
is in full force and effect, and upon endorsement and delivery of the
related Note to the Company and recording of the related Assignment of
Mortgage in favor of the Company in the applicable real estate records, such
title insurance policy will inure to the benefit of the Company. Such title
policy (1) does not contain the standard general exceptions for
encroachments, boundary or other survey matters and for easements not shown
by the public records, other than such exceptions as are customarily
accepted by prudent commercial mortgage lenders in the related jurisdiction,
and (2) only contains such exceptions for boundary, encroachments and survey
issues as are customarily accepted by prudent commercial mortgage lenders.
If required by the Originator, such title policy includes an endorsement
with respect to zoning and permitted uses. Neither the Seller nor Midland
has taken, or omitted to take, any action, and, to the best knowledge of the
Seller and Midland, no other person has taken, or omitted to take, any
action, that would materially impair the coverage benefits of any such title
insurance policy. Neither the Seller nor Midland has made any claim under
such title insurance policy. Such title insurance policy does not include
the general exception for intervening liens which appeared in the commitment
for such title insurance.
(xxii) Hazard Insurance. The related Mortgaged Property is
insured by a fire and extended perils insurance policy, issued by an
insurance company which is rated A:V or better by Best's Key Rating Guide
(except with respect to (a) Mortgage Loan Nos. 94-0901358 and 94-0901831,
wherein such ratings were B++:XV and B++:XV, respectively, and (b) Mortgage
Loan Nos. 94-0903231 and 94-0903232, wherein such insurance was provided
collectively by a consortium of 36 insurers, 35 of which individually
satisfy such rating requirement), providing coverage against loss or damage
sustained by reason of fire, lightning, windstorm, hail, explosion, riot,
riot attending a strike, civil commotion, aircraft, vehicles and smoke, and,
to the extent required as of the date of origination of such Mortgage Loan
by Midland consistent with Midland's customary closing requirements, against
earthquake and other risks insured against for which persons operating like
properties in the locality of such Mortgaged Property obtain insurance, in
an amount not less than the lesser of (1) the full replacement cost of all
improvements to such Mortgaged Property and (2) the outstanding principal
balance of such Mortgage Loan, but in any event in an amount sufficient to
avoid the operation of any co-insurance provisions contained in such
insurance policy. The related Mortgage contains provisions requiring the
related Borrower to maintain business interruption and/or rental
continuation coverage, except with respect to Mortgage Loan Nos. 94-0901753,
94-0902139 and 94-0902140 no such business
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interruption and/or rental continuation insurance was required so long as
S&P's debt rating of the respective sole tenants of the related Mortgaged
Properties remains at least BBB or greater. If any material improvement on
such Mortgaged Property is located in an area identified by the Federal
Emergency Management Agency as having special flood hazards under the
National Flood Insurance Act of 1968, as amended, such Mortgaged Property is
insured by a flood insurance policy issued by an insurance company
acceptable to Midland, the Seller and Realty Funding and meeting the current
requirements of the Federal Insurance Administration in an amount not less
than the lesser of (A) the stated principal amount of the related Note and
(B) the maximum amount of insurance available under the Flood Disaster
Protection Act of 1973, as amended. Each such insurance policy includes a
lender's loss payable endorsement in favor of Midland and requires at least
thirty (30) days' prior written notice to Midland of termination or
cancellation, and no such notice has been received by Midland. Such
insurance policies are in full force and effect and will inure to the
benefit of the Company as of the Closing Date. To the Seller's and
Midland's best knowledge, all premiums due and payable on such insurance
policies prior to the Closing Date have been paid and nothing has occurred
that would materially impair the benefits of coverage thereunder. In
connection with the placement of any such insurance, no commission, fee or
other compensation has been or will be received by Midland or, to the
Seller's and Midland's best knowledge, any officer, director or employee of
Midland. Such Mortgage obligates such Borrower to maintain all such
insurance or otherwise cause all such insurance to be maintained, and, at
such Borrower's failure to do so, authorizes the mortgagee to maintain such
insurance at such Borrower's cost and expense and to seek reimbursement
therefor from such Borrower.
(xxiii) Loan-to-Value Ratio and Debt Service Coverage Ratio. The
Loan-to-Value Ratio for such Mortgage Loan does not exceed 75%, except with
respect to Mortgage Loan Nos. 94-0902485 and 94-0903232, wherein the
Loan-to-Value Ratios were 80.36% and 78.2%, respectively. The Debt Service
Coverage Ratio for such Mortgage Loan is not less than 1.20, except with
respect to Mortgage Loan No. 94-0901831, wherein the Debt Service Coverage
Ratio was 1.18.
(xxiv) No Construction or Rehabilitation Mortgage Loans. Such
Mortgage Loan was not made for the purpose of financing the construction or
substantial rehabilitation of the related Mortgaged Property.
(xxv) UCC Financing Statements. One or more Uniform Commercial
Code financing statements covering all furniture, fixtures, equipment and
other personal property (1) which are collateral under the related Mortgage
or under a security or similar agreement executed and delivered in
connection with such Mortgage Loan and (2) in which a security interest can
be perfected by the filing of Uniform Commercial Code financing statement(s)
under applicable law have been filed or recorded (or have been sent for
filing or recording) in all Uniform Commercial Code filing offices necessary
to the perfection under applicable law, of a security interest in such
furniture, fixtures, equipment and other personal property.
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(xxvi) Proceeds of Mortgage Loan. The proceeds of such Mortgage
Loan have not been used to satisfy, in whole or in part, any debt owed or
owing by the related Borrower to Midland or the Seller or any Affiliate of
Midland or the Seller.
(xxvii) Default, Breach and Acceleration. There is no monetary
default, breach, violation or event of acceleration existing under the
related Mortgage or the related Note and no event (other than failure to
make payments due but not yet delinquent) which, with the passage of time or
with notice and the expiration of any grace or cure period, would constitute
a monetary default, breach, violation or event of acceleration. In
addition, to the best knowledge of the Seller and Midland, there is no
non-monetary default, breach, violation or event of acceleration existing
under such Mortgage or such Note and no event which, with the passage of
time or with notice and the expiration of any grace or cure period, would
constitute a non-monetary default, breach, violation or event of
acceleration. In accordance with the terms of the related Mortgage Loan
Documents, no Person other than the holder of such Note is permitted to
declare an event of default or accelerate the indebtedness under such
Mortgage Loan Documents. There is no monetary default and, to the best
knowledge of the Seller and Midland, there is no non-monetary default on any
other debt obligation of the related Borrower owed or owing to the Seller or
any Affiliate of the Seller.
(xxviii) Customary Provisions. The related Note or the related
Mortgage contains customary and enforceable provisions such as to render the
rights and remedies of the holder thereof adequate for the practical
realization against the related Mortgaged Property of the benefits of the
security, including but not limited to judicial or, if applicable,
non-judicial foreclosure.
(xxix) Mortgage Loan Terms. Principal payments under the
related Note commence no more than sixty days after the proceeds of such
Mortgage Loan are fully disbursed. The interest rate on such Note is as set
forth in the Mortgage Loan Schedule. Such Note has a stated maturity, is
payable on the first day of each month (except with respect to (1) Mortgage
Loan No. 94-0900581, which is payable on the sixth day of each month, and
(2) Mortgage Loan No. 94-0900683 (the Seaport Participation Interest), as to
which the Seaport Participation Agreement provides for remittances on the
business day immediately preceding the 25th day of each month) in equal
monthly installments of principal and interest (except with respect to (A)
Mortgage Loan No. 94-0901028, as to which such monthly installments of
principal and interest will adjust in accordance with the adjustment of the
amortization of such Mortgage Loan as described below, and (B) Mortgage Loan
No. 94-0903265, which provides that the amount of the monthly installments
of principal and interest will increase on a specified date prior to
maturity), with interest calculated and payable in arrears, sufficient to
amortize the original principal balance of such Mortgage Loan fully over an
original term of not more than 25 years (or, with respect to Mortgage Loan
No. 94-0901028, 35 years, which figure will reduce to 21 years for the
remaining term of such Mortgage Loan commencing three years after the
origination of such Mortgage Loan) from commencement of amortization and
does not provide for any grace period or cure period that exceeds ten days
with respect to the payment of monthly installments of principal and
interest, 30 days with
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respect to the payment of other sums due under such Note or the related
Mortgage or 60 days with respect to the compliance with or performance of
other terms or conditions of such Note and Mortgage. The related Mortgage
Loan Documents do not provide for any negative amortization. The related
Mortgage provides for the appointment of a receiver for rents, or the
mortgagee's entry into possession of the related Mortgaged Property, to
collect rents in connection with an event of default or acceleration. With
respect to Mortgage Loan Nos. 94-0903265, 94-0903261, 94-0903262 and
94-0903276, the mortgagee has the option to accelerate the maturity of each
such Mortgage Loan in the absence of an event of default during either of
one or two specific intervals of twelve consecutive months.
(xxx) Inspection. Except with respect to Mortgage Loan No.
94-0902784, the Originator has inspected the related Mortgage Property or
caused such Mortgaged Property to be inspected in connection with the
origination of such Mortgage Loan within the six month period prior to the
date on which the Seller purchased such Mortgage Loan from the Originator.
With respect to Mortgage Loan No. 94-0902784, Midland caused the related
Mortgaged Property to be inspected within the six month period prior to the
date on which the Seller purchased such Mortgage Loan from Midland.
(xxxi) No Notice of Bankruptcy. The Seller has no knowledge nor
has it received any notice that the related Borrower is a debtor in any
state or federal bankruptcy or insolvency proceeding.
(xxxii) Access Routes. At the time of origination of such
Mortgage Loan, (1) the related Borrower had sufficient rights with respect
to amenities, ingress and egress and similar matters identified in the
appraisal of the related Mortgaged Property as being critical to the
Appraised Value thereof and (2) to the best of the Seller's and Midland's
knowledge, such Mortgaged Property was receiving adequate services from
public or private water, sewer and other utilities.
(xxxiii) Mortgage Loans Secured by Ground Lease but Not Fee
Interest. With respect to each Midland Mortgage Loan (excluding, however,
Mortgage Loan No. 94-0902784) that is secured in whole or in part by the
interest of the related Borrower as lessee under a ground lease of all or a
portion of the related Mortgaged Property (a "Ground Lease"), but the
related fee interest in the portion of such Mortgaged Property covered by
such Ground Lease (the "Fee Interest") is not subject or subordinate to
the lien of the related Mortgage, the Seller hereby represents and warrants
that:
(1) to the Seller's and Midland's best knowledge: (A)
such Ground Lease is in full force and effect, (B) such Ground Lease or
a memorandum thereof has been recorded, (C) such Ground Lease does not
prohibit the interest of the related lessee thereunder from being
encumbered by the related Mortgage, or a separate written agreement
permitting such encumbrance has been obtained, and (D) there have been
no material changes in the terms of such Ground Lease except as set
forth in written instruments which are part of the related Mortgage
File;
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(2) except as may be indicated in the related title insurance
policy, the related lessee's leasehold interest in the portion of the
related Mortgaged Property covered by such Ground Lease is not subject to
any liens or encumbrances superior to, or of equal priority with, the
related Mortgage;
(3) the related lessee's interest in such Ground Lease may be
transferred to the Company and its successors and assigns through
foreclosure of the related Mortgage or conveyance in lieu of foreclosure
and, thereafter, may be transferred to another Person by the mortgagee
and its successors and assigns, upon notice to, but without the consent
of, the related lessor (or, if any such consent is required, either (A)
it has been obtained prior to the Closing Date or (B) it is not to be
unreasonably withheld) provided such Ground Lease has not been terminated
and all amounts owed thereunder have been paid;
(4) the related lessor is required to give notice of any
default under such Ground Lease by the related lessee to the Seller
either under the terms of such Ground Lease (the related lessor having
received notice of the related Mortgage) or under the terms of a separate
written agreement;
(5) the Seller is entitled, under the terms of such Ground
Lease or a separate written agreement, to receive notice of any default
by the related lessee under such Ground Lease, and after any such notice
is entitled to the time provided to the related lessee under such Ground
Lease to cure such default;
(6) the currently effective term of such Ground Lease
(excluding any extension or renewal which is not binding on the lessor
thereunder) extends not less than 10 years beyond the Maturity Date of
the related Midland Mortgage Loan;
(7) such Ground Lease does not impose any restrictions on
subletting which the Seller considered to be commercially unreasonable at
the time of origination of such Midland Mortgage Loan; and
(8) the Seller has not received any notice that (A) the
related lessor under such Ground Lease is asserting a default by the
related lessee or an event of default thereunder or (B) any event has
occurred which, with the passage of time, the giving of notice, or both
(other than rental or other payments being due, but not yet delinquent),
would result in a default or an event of default under the terms of such
Ground Lease.
(xxxiv) Mortgage Loans Secured by Both Ground Lease and Fee Interest.
With respect to each Mortgage Loan that is secured in whole or in part by the
interest of the related Borrower as lessee under a Ground Lease of all or a
portion of the related Mortgaged Property, and as to which the related Fee
Interest is subject or subordinate to the lien of the related Mortgage, the
Seller hereby represents and warrants that (1) such fact is set forth in the
Mortgage Loan Schedule and (2):
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(A) such Fee Interest is subject or subordinated of record to
such Mortgage; and such Mortgage does not by its terms provide that it
will be subordinated to the lien of any other mortgage or encumbrance
upon such Fee Interest; and
(B) except as disclosed in writing in the related Mortgage
File and as approved by the Seller in writing in connection with its
purchase of such Mortgage Loan from Midland, upon occurrence of a default
under the terms of such Mortgage by the related Borrower, any right of
the related lessor to cure such default (granted to such lessor under any
agreement binding upon the Seller) would entitle such lessor, prior to
acceleration of the maturity of such Mortgage Loan and the commencement
of foreclosure of such Mortgage, to be given notice of such default and
(I) no more than 30 days after such notice, to cure any default in the
payment of principal or interest or other monetary default under such
Mortgage and (II) no more than 60 days after such notice, to cure any
other default or, alternatively, to commence proceedings to recover
possession of such Mortgaged Property plus a reasonable opportunity to
cure such default after such lessor's recovery of possession if such
lessor pursues such proceedings in good faith and with due diligence.
(xxxv) Deed of Trust. With respect to any related Mortgage that is a
deed of trust or trust deed, a trustee, duly qualified under applicable law to
serve as such, has either been properly designated and currently so serves or
may be substituted in accordance with applicable law. Except in connection with
a trustee's sale after default by the related Borrower or in connection with
the release of the related Mortgaged Property following the payment of such
Mortgage Loan in full, no fees or expenses are payable by the Seller, Midland
or the Company to such trustee.
(xxxvi) Appraisal. The related Mortgage File contains an appraisal of
the related Mortgaged Property by an appraiser, who, to the best knowledge of
the Seller and Midland, had no interest, direct or indirect, in such Mortgaged
Property or in any loan made on the security thereof; whose compensation, under
the terms of the appraiser's engagement to the best knowledge of the Seller and
Midland, was not (directly or indirectly) based upon the approval or
disapproval of such Mortgage Loan (other than a reduction of such compensation
due to an early termination of the engagement); and who (1) was MAI certified
or (2) was state-licensed or state-certified if required by applicable law and
was a member of, and had a professional designation from, a nationally
recognized appraisal organization other than MAI. To the best knowledge of the
Seller and Midland, such appraisal satisfied Midland's customary underwriting
and closing requirements and procedures. The market value used by the Seller in
calculating the Loan-to-Value Ratio of such Mortgage Loan was not greater than
the Appraised Value as set forth in such appraisal.
(xxxvii) Type of Mortgaged Property. The related Mortgaged Property
consists of an estate in fee simple or leasehold estate in real property and
improvements thereon as set forth in the Mortgage Loan Schedule. Such Mortgaged
Property is
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improved as a commercial Mortgaged Property or a multifamily Mortgaged Property
as set forth on the Mortgage Loan Schedule.
(xxxviii) Mortgage Acceleration Provisions. The related Mortgage
contains a provision for the acceleration of the payment of the unpaid
principal balance of such Mortgage Loan in the event that (A) the related
Mortgaged Property is sold or transferred without the prior written consent of
the mortgagee thereunder, except (1) with respect to Mortgage Loan Nos.
94-0900155, 94-0901609 and 94-0903276 (each of which permits the related
Borrower to obtain a release of portions of the related Mortgaged Property
under the limited circumstances set forth in the related Mortgage, including
the payment of a specified amount to be applied against the outstanding
principal balance of such Mortgage Loan and the applicable prepayment
consideration), (2) with respect to Mortgage Loan Nos. 94-0901039 and
94-0902096 (each of which permits the related Borrower to obtain a release of a
portion of such Mortgaged Property under the limited circumstances set forth in
the related Mortgage without any required payments or prepayment
consideration), and (3) with respect to Mortgage Loan No. 94-0903263 (which
permits the related borrower to obtain a release of a portion of such Mortgaged
Property under the limited circumstances set forth in the related Mortgage,
including the payment of a specified amount to be applied against the
outstanding principal balance of the related Mortgage Loan, but without any
prepayment consideration), or (B) the related Borrower encumbers the related
Mortgaged Property without the consent of the mortgagee thereunder, except (1)
with respect to Mortgage Loan Nos. 94-0900776, 94- 0901753, 94-0902139 and
94-0902140 (each of which permits the sole tenant of the related Mortgaged
Property to encumber its leasehold interest with a leasehold mortgage), (2)
with respect to Mortgage Loan Nos. 94-0900480, 94-0900748, 94- 0901028,
94-0901277 and 94-0902096 (each of which permits secondary financing under the
limited circumstances set forth in the related Mortgage), and (3) with respect
to Mortgage Loan Nos. 94-0900719 and 94-0901138 (each of which permits
secondary financing in connection with a wrap-around mortgage under the limited
circumstances set forth in the related Mortgage).
(xxxix) No Additional Collateral. The related Note is not, and has
not been, secured by any collateral except the lien of the related Mortgage and
the security interest of any related security documents assigned pursuant to
the related Assignment of Mortgage, except (A) that each of the Notes
applicable to Mortgage Loan Nos. 94- 0902047 and 94-0902048 is secured by all
of the liens and security interests obtained by the Mortgage Loan Seller in
connection with both such Mortgage Loans, (B) that each of the Notes applicable
to Mortgage Loan Nos. 94-0900880 and 94-0900932 is secured by all of the liens
and security interests obtained by the Mortgage Loan Seller in connection with
both such Mortgage Loans, (C) that each of the Notes applicable to Mortgage
Loan Nos. 94-0902205 and 94-0902237 is secured by all of the liens and security
interests obtained by the Mortgage Loan Seller in connection with both such
Mortgage Loans, (D) that each of the Notes applicable to Mortgage Loan Nos. 94-
0902450, 94-0902452 and 94-0902453 is secured by all of the liens and security
interests obtained by the Mortgage Loan Seller in connection with all three of
such Mortgage Loans, and (E) that each of the Notes applicable to Mortgage Loan
Nos. 94-0903231 and
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94-0903232 is secured by all of the liens and security interests obtained by
the Mortgage Loan Seller in connection with both such Mortgage Loans. Such
Mortgage was not given as collateral or security for the performance of
obligations of any person other than the related Borrower, except (1) with
respect to the Mortgage Loans described in items (A) through (E) above, and (2)
with respect to Mortgage Loan No. 94-0902140 wherein the related Mortgage also
secures the payment of a guaranty given by the related borrower in connection
with Mortgage Loan No. 94-0901753.
(xl) Assignment of Leases, Rents and Profits. Unless the related
Mortgaged Property is occupied by the related Borrower, the Mortgage Loan
Documents related to such Mortgage Loan contain the provisions of an Assignment
of Leases, Rents and Profits or such Borrower has delivered a separate
Assignment of Leases, Rents and Profits. Any related Assignment of Leases,
Rents and Profits incorporated within the related Mortgage or set forth in a
separate Mortgage Loan Document creates a valid first priority assignment of,
or security interest in, the right to receive all payments due under the
related leases, if any, subject to the effect of bankruptcy, insolvency,
reorganization, receivership, moratorium or other laws relating to or affecting
the rights of creditors generally and general principles of equity (regardless
of whether considered in a proceeding in equity or at law); and no Person other
than the related Borrower owns any interest in the right to receive any
payments due under such leases that is superior to or of equal priority with
the mortgagee's interest therein.
(xli) REMIC. (1) Such Mortgage Loan is directly secured by a mortgage
on a real property, and (2) either (A) substantially all of the proceeds of
such Mortgage Loan were used to acquire or improve or protect an interest in
real property that, at origination, was the only security for such Mortgage
Loan or (B) if such Mortgage Loan has not been modified, other than following a
default, at origination, or, if such Mortgage Loan has been "substantially
modified" within the meaning of Section 1001 of the Code, on the date of such
modification (unless such modification may be disregarded under Treas. Reg.
Sec. 1.860G-2(b)(3)), the fair market value of such real property was at least
equal to 80% of the principal amount of such Mortgage Loan at origination or
modification, whichever is applicable.
(xlii) Environmental Assessment. (1) In connection with the
origination of such Mortgage Loan, a Phase I Environmental Report and, if
recommended by the Phase I Environmental Report, a Phase II Environmental
Report with respect to the related Mortgaged Property were obtained from an
independent environmental engineer or consultant; and (2) such Environmental
Report(s) did not indicate the existence of conditions or circumstances
respecting such Mortgaged Property that would (A) constitute or result in a
material violation of any applicable Environmental Law, (B) impose any material
constraint on the operation of such Mortgaged Property or require material
change in the use thereof or (C) require clean-up, remedial action or other
response with respect to Hazardous Materials on or affecting such Mortgaged
Property under any applicable Environmental Law, with the exception of
conditions or circumstances (I) which such Environmental Report(s) indicated
could be cleaned up, remediated or brought into compliance with applicable
Environmental Law by the taking of certain
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actions and (II) either (a) for which a hold-back or other escrow of funds not
less than the costs of taking such clean-up, remediation or compliance actions
as estimated in such Environmental Report(s) has been created to be held by
Midland or an escrow agent until such clean-up, remediation or compliance
actions have been taken or (b) for which an environmental insurance policy in
an amount satisfactory to the Originator has been obtained by the related
Borrower or an indemnity for such costs has been obtained from a potentially
culpable party, or (c) such clean up, remediation or compliance actions in
compliance with applicable Environmental Law have been completed prior to the
closing of such Mortgage Loan. For purposes of this Agreement, the term
"Hazardous Materials" shall include, without limitation, gasoline, petroleum
products, explosives, radioactive materials, polychlorinated biphenyls or
related or similar materials, asbestos or any material containing asbestos, and
any other substance or material as may be defined as a hazardous or toxic
substance under any applicable Environmental Law; and the term "Environmental
Law" shall mean any environmental law, ordinance, rule, regulation or order of
a federal, state or local governmental authority, including, without
limitation, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. ss.ss. 9601 et seq.) ("CERCLA"),
the Hazardous Material Transportation Act, as amended (49 U.S.C. ss.ss. 1801 et
seq.), the Resource Conservation and Recovery Act, as amended (42 U.S.C. ss.ss.
6901 et seq.), the Federal Water Pollution Control Act, as amended (33 U.S.C.
ss.ss. 1251 et seq.), the Clean Air Act, as amended (42 U.S.C. ss.ss. 7401 et
seq.) and the regulations promulgated pursuant thereto. Neither Midland nor the
Seller has taken any action which would cause either such Mortgaged Property or
the Trust Fund under the Pooling and Servicing Agreement to become subject to
liability under CERCLA.
(xliii) Notice of Environmental Problem. Other than with respect to
any conditions identified in the Phase I and/or Phase II Environmental Reports
referred to in Section 2(c)(xlii) above, none of the Seller, the Originator or
Midland: (1) has received actual notice from any federal, state or other
governmental authority of (A) any failure of the related Mortgaged Property to
comply with any applicable Environmental Laws or (B) any known or threatened
release of Hazardous Materials on or from such Mortgaged Property in violation
of Environmental Laws; or (2) has received actual notice from the related
Borrower that (A) such Borrower has received any such notice from any such
governmental authority, (B) such Mortgaged Property fails to comply with
Environmental Laws, or (C) has received actual notice that there is any known
or threatened release of Hazardous Materials on or from such Mortgaged Property
in violation of Environmental Laws; or (3) has any actual knowledge that (A)
the related Mortgaged Property fails to materially or significantly comply with
any applicable Environmental Law or (B) there has been any known or threatened
material or significant release of Hazardous Materials on or from such
Mortgaged Property in violation of any applicable Environmental Law.
(xliv) No Untrue Information. No statement, report, or other document
furnished by or on behalf of the Seller, Midland or any Affiliate thereof in
writing (including writings in electronic form) pursuant to this Agreement
relating to such Mortgage Loan contains any untrue statement by the Seller,
Midland or any Affiliate
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thereof of any material fact or an omission by the Seller, Midland or any
Affiliate thereof of a material fact necessary to make the statements contained
therein not misleading. Based upon its review of its files and such inquiry as
is customary by a prudent commercial mortgage lender, each of the Seller and
Midland does not know or have reason to know that any such statement, report,
or other document furnished by or on behalf of the Seller, Midland or any
Affiliate thereof in writing (including writings in electronic form) pursuant
to this Agreement relating to such Mortgage Loan contains any untrue statement
by any other person of any material fact or an omission of a material fact
necessary to make the statements contained therein not misleading.
(xlv) Asset Concentration. No such Mortgage Loan and no group of
Mortgage Loans made to any Borrowers that are Affiliates accounted for more
than 7.4% of the aggregate of the principal balances of all Mortgage Loans as
of the Cut-off Date.
(xlvi) Due Qualification. Each holder of the related Mortgage was, at
all times that it was such holder, duly organized, validly existing and in good
standing under the laws of its state of establishment or incorporation, as
applicable, and was duly qualified to transact business as a foreign limited
partnership, corporation or other entity, as applicable, and in good standing
in the state in which the related Mortgaged Property is located to the extent
necessary to ensure the enforceability of the lien of such Mortgage on such
Mortgaged Property.
(xlvii) Recourse. The related Mortgage Loan Documents contain
standard provisions providing for recourse against the related Borrower for
damages sustained in connection with the Borrower's fraud, intentional
misrepresentation, or misappropriation of any tenant security deposits or rent.
The related Mortgage Loan Documents contain provisions pursuant to which the
related Borrower has agreed to indemnify the mortgagee for damages resulting
from violations of Environmental Laws, except with respect to Mortgage Loan
Nos. 94-0903276 and 94-0903277, in which such indemnity obligation is a
non-recourse obligation and is therefore limited to the related Borrower's
interest in the related Mortgaged Property.
(xlviii) Underwriting and Origination Policies and Procedures. Except
with respect to Mortgage Loan No. 94-0902784, the underwriting and closing
policies and procedures utilized by Midland with respect to each Midland
Mortgage Loan conformed, in all material respects, to Midland's customary
underwriting and closing policies and procedures in effect at the time of the
underwriting and origination of such Midland Mortgage Loan, with such
exceptions thereto as Midland believed to be customarily acceptable to
reasonable and prudent commercial mortgage lenders.
(xlix) Leases. Except with respect to Mortgage Loan No. 94-0902784,
with respect to each Midland Mortgage Loan: (1) prior to the origination of
such Midland Mortgage Loan, Midland obtained tenant estoppel certificates from
all tenants whose leases covered more than 10% of the net leasable area of the
related Mortgaged Property, and based upon such tenant estoppel certificates,
no defaults with respect to any such lease existed as of the date of the
related tenant estoppel certificate; and (2)
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neither the Seller nor Midland has received any notice of the existence of any
such default under any such leases, or of the existence of any condition,
which, but for the passage of time or the giving of notice, or both, would
result in such a default under the terms of such lease.
(l) Legal Opinions. Except with respect to Mortgage Loan No. 94-
0902784, the Mortgage File for each Midland Mortgage Loan contains an opinion
from counsel to the Borrower which conforms in all material respects to the
form of opinion required by Midland in connection with the origination of the
Midland Mortgage Loans, containing only those modifications which Midland
believed to be customarily accepted by a reasonable and prudent commercial
mortgage lender to conform such opinion to local laws and customs.
(d) The Seller hereby represents and warrants that as of the date hereof:
(i) Seaport Participation Interest Valid. The Seaport Participation
Interest is an undivided 49.3% participation interest in the Seaport Loan
created by the Seaport Participation Agreement and represented by the Seaport
Participation Certificate. The Seaport Participation Agreement constitutes (A)
the legal, valid and binding obligation of the Seller, enforceable against the
Seller in accordance with its terms, and (B) to the best knowledge of the
Seller, the legal, valid and binding obligation of all other parties thereto,
enforceable against such other parties in accordance with its terms, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
receivership, moratorium or other laws relating to or affecting the rights of
creditors generally and by general principles of equity (regardless of whether
such enforcement is considered in a proceeding in equity or at law).
(ii) Assignment of Seaport Participation Interest. The Seller has
surrendered the Seaport Participation Certificate to the Seaport Trustee and
notified the Seaport Trustee in writing that the Seaport Participation Interest
has been sold, transferred and assigned by the Seller to the Company. This
Agreement constitutes the Seller's legal, valid and binding assignment to the
Company of the Seaport Participation Interest, and together with the issuance
by the Seaport Trustee (in accordance with the Seaport Participation Agreement)
of a new participation certificate in the name of the Company evidencing the
Seaport Participation Interest, legally and validly conveys to the Company all
right, title and interest of the Seller in the Seaport Participation Interest,
free and clear of any and all liens, encumbrances, pledges, charges or security
interests of any nature.
(iii) Participation Agreement Representations. All representations
and warranties of the Seller made under the Participation Agreement are true
and correct in all material respects.
3. Remedies for Breach of Certain Representations and Warranties. (a)
It is understood and agreed that the representations and warranties set forth
herein shall survive the sale of the Mortgage Loans to the Company and shall
inure to the benefit of the Company, and
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the Trustee as the transferee of the Company, notwithstanding (1) any
restrictive or qualified endorsement on any Note, Assignment of Mortgage or
Reassignment of Assignment of Leases, Rents and Profits (2) any termination of
this Agreement or (3) the examination by any Person of, or failure by any
Person to examine, any Mortgage File.
(b) Upon the discovery by the Seller, Midland or the Company that (i)
a document required to be delivered pursuant to Section 2.1 of the Pooling and
Servicing Agreement in connection with any Mortgage Loan has not been executed
or received, has not been recorded or filed (if required), appears not to be
what it purports to be or has been torn, mutilated or otherwise defaced (such
Mortgage Loan, a "Defective Document Mortgage Loan") or (ii) a breach of any of
the foregoing representations and warranties (other than the representations
and warranties set forth in Sections 2(a) and 2(b)) or a default in the
performance of any of the covenants or other obligations of the Seller under
this Agreement has occurred (a "Breach") which, in the case of either clause
(i) or (ii), materially and adversely affects the interest of the owners of one
or more Mortgage Loans, who may include Certificateholders, the party
discovering (x) that a Mortgage Loan is a Defective Document Mortgage Loan or
(y) the existence of a Breach (any such Mortgage Loan as described in the
preceding clause (x) or so affected by a Breach as described in clause (y), a
"Defective Mortgage Loan") shall give prompt written notice thereof to the
other parties. Within 85 days of its discovery or its receipt of notice of any
such Defective Mortgage Loan, the Seller shall (i) promptly cure such defect or
Breach in all material respects or (ii) repurchase the Defective Mortgage Loan
or Loans at the Repurchase Price for such Mortgage Loan or Loans in accordance
with the directions of the owners of such Defective Mortgage Loans; provided,
however, if such defect or Breach cannot be cured within such 85 day period, so
long as the Seller shall be actively and diligently attempting to cure such
defect or Breach, such 85 day period shall be extended for an additional 90
days; provided further that no such extension shall be applicable unless the
Seller delivers to the Company (or its successor in interest) an officers'
certificate (i) describing the measures being taken to cure such defect or
Breach and (ii) stating that the Seller believes such defect or Breach will be
cured within such 90 days. If any Mortgage Loan fails to constitute a Qualified
Mortgage by reason of defective or missing documentation as described above or
a breach of a representation, warranty, or covenant of the Seller pursuant to
this Agreement, the Seller shall correct such condition, defect or breach or
repurchase such Mortgage Loan at the Repurchase Price within 85 days of
discovery of such failure and no extension of the 85-day period shall apply.
The payment of the Repurchase Price with respect to any Mortgage Loans
repurchased by the Seller shall be paid in accordance with the directions of
the owners of such Mortgage Loans. It is understood and agreed that the
obligations of the Seller set forth in this Section 3(b) to cure or repurchase
a Defective Mortgage Loan constitute the sole remedies available to the Company
and its successors and assigns respecting a breach of the representations and
warranties of the Seller set forth in Section 2(c). Upon any such repurchase of
a Mortgage Loan by the Seller, the Company shall execute and deliver such
instruments of transfer or assignment presented to it by Seller, in each case
without recourse, as shall be necessary to vest in the Seller the legal and
beneficial ownership of such Mortgage Loan (including any property acquired in
respect thereof or proceeds of any insurance policy with respect thereto), and
shall deliver the related Mortgage File to the Seller or its designee after
receipt of the related Repurchase Price.
23
<PAGE> 397
(c) In the event the Seller fails to cure or repurchase any Defective
Mortgage Loan which it is obligated to cure or repurchase under Section 3(b)
because of a breach by Midland of a representation or warranty with respect to
a Midland Mortgage Loan set forth in Section 2(c) or any Mortgage Loan which
fails to constitute a Qualified Mortgage by reason of a breach by Midland of a
representation or warranty with respect to a Midland Mortgage Loan set forth in
Section 2(c) within the applicable period set forth in Section 3(b), Midland
shall cure or repurchase such Defective Mortgage Loan or such Mortgage Loan at
the Repurchase Price within two Business Days after the expiration of such
applicable period. The payment of the Repurchase Price with respect to any
Mortgage Loan repurchased by Midland shall be paid in accordance with the
directions of the owners of such Mortgage Loan. It is understood and agreed
that the obligations of Midland set forth in this Section 3(c) to cure or
repurchase a Defective Mortgage Loan constitute the sole remedies available to
the Company and its successors and assigns respecting a breach of the
representations and warranties of Midland set forth in Sections 2(c). Upon any
such repurchase of a Mortgage Loan by Midland, the Company shall execute and
deliver such instruments of transfer or assignment presented to it by Midland,
in each case without recourse, as shall be necessary to vest in Midland the
legal and beneficial ownership of such Mortgage Loan (including any property
acquired in respect thereof or proceeds of any insurance policy with respect
thereto), and shall deliver the related Mortgage File to Midland or its
designee after receipt of the related Repurchase Price.
(d) Except as expressly set forth in Section 3(b), no provision of
this Agreement shall be interpreted as limiting (or otherwise be deemed to
limit) the Company's right to pursue any remedies it may have under this
Agreement, in equity or at law, in connection with any breach by the Seller of
any term hereof. Except as expressly set forth in Section 3(c), no provision of
this Agreement shall be interpreted as limiting (or otherwise be deemed to
limit) the Company's right to pursue any remedies it may have under this
Agreement, in equity or at law, in connection with any breach by Midland of any
term hereof.
(e) The 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 Seller to cure or repurchase
Defective Mortgage Loans pursuant to this Section. Midland 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 made by Midland as set forth in Section 2(c) and
of the obligation of Midland to cure or repurchase Defective Mortgage Loans
pursuant to Section 3(c). The Trustee or its designee may enforce such
obligation as provided in Section 9 hereof.
(f) Notwithstanding anything herein to the contrary, neither Seller
nor Midland shall have any obligation to cure any defect or Breach with respect
to, or to repurchase, the Seaport Participation Interest at any time after the
Seaport Loan has been repurchased pursuant to that certain Mortgage Loan
Purchase and Sale Agreement dated July 26, 1995 executed by and among the
Company, the Seller and Midland.
4. Indemnification. (a) The Seller and Midland shall jointly and
severally indemnify and hold harmless each of the Company, the Placement Agent
and Prudential
24
<PAGE> 398
Securities Realty Funding Corporation, and each Affiliate thereof, and their
respective officers and directors, and each person, if any, who controls the
Company, the Placement Agent and Realty Funding within the meaning of Section
15 of the Securities Act of 1933, as amended (the "Securities Act")
(collectively, for purposes of this Section 4, the "Indemnified Parties"),
against any and all losses, claims, damages, liabilities or expenses
(including, without limitation, the reasonable cost of investigating and
defending against any claims therefor and legal fees and disbursements incurred
in connection therewith except as otherwise provided below), joint or several,
which may be based upon the Securities Act, any other statute or common law, on
the ground or alleged ground that the sections of the Private Placement
Memorandum relating to the placement of the Privately Placed Certificates (the
"Memorandum") or the Prospectus Supplement relating to the offer and sale of
the Publicly Offered Certificates (the "Prospectus Supplement"), describing the
Seller, Midland, any Affiliate thereof or the Mortgage Loans and other
descriptions of the Seller, Midland, any Affiliate thereof or the Mortgage
Loans set forth in other sections of the Memorandum or the Prospectus
Supplement, respectively, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading; in no case shall either
the Seller or Midland be liable with respect to any claims made against any of
the Indemnified Parties unless an Indemnified Party shall have notified either
the Seller or Midland in writing of the nature of the claim within a reasonable
time after service of a summons or other first legal process that shall have
been served upon such Indemnified Party, but failure to notify either the
Seller or Midland of any such claims shall not relieve the Seller and Midland
from any liability which it may have to any Indemnified Party otherwise than on
account of the indemnity agreement contained in this paragraph. Each of the
Seller and Midland will be entitled to participate at its own expense in the
defense or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but if the Seller or Midland elects to assume the
defense, such defense shall be conducted by legal counsel chosen by the Seller
or Midland, as appropriate. In the event the Seller or Midland elects to assume
the defense of any such suit and retain such legal counsel, any Indemnified
Party that is a defendant in the suit may retain additional legal counsel but
shall bear the legal fees and disbursements of such legal counsel unless (i)
the Seller, Midland and such Indemnified Party shall have mutually agreed to
the retention of such legal counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the Seller and
Midland and such Indemnified Party, and representation of both such parties by
the same legal counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Seller and Midland
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the legal fees and disbursements of more than one
legal counsel for all the Indemnified Parties and that all such legal fees and
disbursements shall be reimbursed by Midland and/or the Seller as they are
incurred. The Seller and Midland shall not be liable to indemnify any person
for any settlement of any claim effected without the Seller's and Midland's
consent, which consent shall not be unreasonably withheld. The Seller and
Midland shall not, without the prior written consent of any Indemnified Party,
which consent will not be unreasonably withheld, effect any settlement of any
pending or threatened proceeding in respect of which such Indemnified Party is
a party and indemnity is or could have been sought hereunder by such
Indemnified Party unless such settlement includes an unconditional release of
such Indemnified Party from all liability which such Indemnified Party may
otherwise have.
25
<PAGE> 399
(b) If the indemnification provided for in Section 4(a) above is
unavailable to hold harmless an Indemnified Party in respect of any losses,
claims, damages, liabilities or expenses (or actions in respect thereof)
referred to therein, then the Seller and Midland, jointly and severally, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages, liabilities or expenses (or actions in respect
thereof) in such proportion as is appropriate to reflect the relative fault of
the Seller and Midland on the one hand and such Indemnified Person on the other
in connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Seller and Midland or by
such Indemnified Person and such parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The parties hereto agree that it would not be just and equitable if contribution
were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to above.
The amount paid or payable by an Indemnified Party as a result of the losses,
claims, damages, liabilities or expenses (or actions in respect thereof)
referred to above shall be deemed to include any legal fees and disbursements or
other expenses reasonably incurred by such Indemnified Party in connection with
investigating or defending any such claim. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
5. Opinions of Counsel. The Seller hereby covenants to the Company
to, simultaneously with the execution hereof, deliver or cause to be delivered
to the Company (a) opinions of counsel as to various corporate matters in form
satisfactory to the Company (it being agreed that the opinion shall expressly
provide that the Trustee and the Fiscal Agent shall be entitled to rely on such
opinions); and (b) opinions of counsel for the Seller, in form acceptable to the
Company, its counsel, and each Rating Agency, as to such matters as shall be
required for the assignment of the ratings of the Certificates required by the
Certificate Purchase Agreement and under the Underwriting Agreement (it being
agreed that such opinions or appropriate reliance letters shall expressly
provide that the Trustee and the Fiscal Agent shall be entitled to rely on such
opinions).
6. Placement; Underwriting. The Seller hereby agrees to furnish any
and all information, documents, certificates, letters or opinions with respect
to the Mortgage Loans reasonably requested by the Company in order to perform
any of its obligations or satisfy any of the conditions on its part to be
performed or satisfied pursuant to the Certificate Purchase Agreement and the
Underwriting Agreement at or prior to the Closing Date.
7. Costs. The Company shall pay all expenses incidental to the
performance of its obligations under the Purchase Agreement and this Agreement,
including without limitation (a) any recording fees or fees for title policy
endorsements and continuations, (b) the expenses of preparing, printing and
reproducing (I) the Memorandum with respect to the Privately Placed Certificates
and (II) the Prospectus Supplement with respect to the Publicly Offered
Certificates, the Purchase Agreement and the Pooling and Servicing Agreement and
the Certificates, (c) the
26
<PAGE> 400
cost of delivering the Privately Placed Certificates to the office of the
Placement Agent or the Company, as applicable, insured to the satisfaction of
the Placement Agent or the Company, as applicable and (d) the cost of delivering
the Publicly Offered Certificates to the office of the Underwriter; provided,
however, that the Seller shall pay the costs and expenses of the Seller's,
Midland's, and Midland's counsel in reviewing, and providing opinions relating
to, the Pooling and Servicing Agreement, the Memorandum, the Purchase Agreement,
the Certificates and this Agreement and the Seller's or Midland's out-of-pocket
expenses relating to meetings with the Rating Agencies or other circumstances in
which the Company or the Placement Agent specifically requests the Seller's or
Midland's assistance.
8. Notices. All communications hereunder shall be in writing and
effective only upon receipt and, if sent to the Company, will be mailed,
delivered or transmitted by facsimile and confirmed to it at Prudential
Securities Secured Financing Corporation, One New York Plaza, New York, New York
10292, Attention: Peter Riemenschneider, Telecopy No.: (212) 778-7403, or, if
sent to the Seller, will be mailed, delivered or transmitted by facsimile and
confirmed to it at KC Funding Corp., 2001 Shawnee Mission Parkway, Shawnee
Mission, Kansas 66205, Attention: Alan L. Atterbury, Telecopy No.: (913)
677-2609, with a copy to Midland Commercial Financing Corp., 210 W. 10th Street,
Kansas City, Missouri 64105, Attention: President, Telecopy No.: (816) 435-2327,
or such other address as may hereafter be furnished to the other parties by like
notice.
9. Trustee Beneficiary. The representations, warranties and
agreements made by the Seller in this Agreement and the representations and
warranties made by Midland in this Agreement are made for the benefit of, and
may be enforced by or on behalf of, the Trustee and the Holders of Certificates
to the same extent that the Company has rights against the Seller under this
Agreement in respect of representations, warranties and agreements made by the
Seller herein and rights against Midland under this Agreement in respect of
representations and warranties made by Midland herein, and all such
representations and warranties shall survive delivery of the respective Mortgage
Files to the Trustee until the termination of the Pooling and Servicing
Agreement.
10. Successors and Assigns. This Agreement will inure to the benefit
of and be binding upon the parties hereto and their respective successors and
assigns, and no other person will have any right or obligation hereunder, other
than as provided in Section 9 hereof.
11. GOVERNING LAW. 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), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
12. Miscellaneous. (a) 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.
(b) This Agreement may not be changed in any manner which would have
a material adverse effect on Holders of Certificates without the prior written
consent of the
27
<PAGE> 401
Trustee. The Trustee shall be protected in consenting to any such change to the
same extent provided in Section 10.7 of the Pooling and Servicing Agreement.
(c) 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.
(d) If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be for any reason whatsoever held invalid, then,
to the extent permitted by applicable law, such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Agreement.
(e) It is the express intent of the parties hereto that the
conveyance contemplated by this Agreement be, and be treated for all purposes
as, a sale by the Seller of all the Seller's right, title and interest in and to
the Mortgage Loans. It is, further, not the intention of the parties that such
conveyance be deemed a pledge of the Mortgage Loans by the Seller to secure a
debt or other obligation of the Seller. However, in the event that,
notwithstanding the intent of the parties, the Mortgage Loans are held to
continue to be property of the Seller then (a) this Agreement shall also be
deemed to be a security agreement under applicable law; (b) the transfer of the
Mortgage Loans provided for herein shall be deemed to be a grant by the Seller
to the Company of a first priority security interest in all of the Seller's
right, title and interest in and to the Mortgage Loans and all amounts payable
to the holder of the Mortgage Loans in accordance with the terms thereof and all
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property; (c) the possession by the
Company or any successor thereto of the related Notes and such other items of
property as constitute instruments, money, negotiable documents or chattel paper
shall be deemed to be "possession by the secured party" for purposes of
perfecting the security interest pursuant to Section 9-305 of the Missouri
Uniform Commercial Code and the Uniform Commercial Code of any other applicable
jurisdiction; and (d) notifications to Persons holding such property, and
acknowledgments, receipts or confirmations from Persons holding such property,
shall be deemed notifications to, or acknowledgments, receipts or confirmations
from, financial intermediaries, bailees or agents (as applicable) of the Company
or any successor thereto for the purpose of perfecting such security interest
under applicable law. Any assignment of the interest of the Company pursuant to
any provision hereof shall also be deemed to be an assignment of any security
interest created hereby.
(f) The Seller agrees to execute and deliver such instruments and
take such actions as the Company may, from time to time, reasonably request in
order to effectuate the purpose and to carry out the terms of this Agreement.
13. Third Party Beneficiary. Prudential Securities Incorporated is an
intended third party beneficiary of the representations and warranties of the
Seller and Midland set forth
28
<PAGE> 402
in Section 2 hereof and Prudential Securities Realty Funding Corporation is an
intended third party beneficiary of the provisions of Section 4 hereof.
[Signature on Next Page]
29
<PAGE> 403
IN WITNESS WHEREOF, the Company, the Seller and Midland have caused
this Agreement to be duly executed by their respective officers as of the day
and year first above written.
PRUDENTIAL SECURITIES SECURED FINANCING
CORPORATION
By:
---------------------------
Name:
Title:
MIDLAND COMMERCIAL FINANCING CORP.
By:
---------------------------
Name:
Title:
MIDLAND LOAN SERVICES, L.P.
By: Midland Data Systems, Inc.
its General Partner
By:
---------------------------
Name:
Title:
S-1
<PAGE> 404
EXHIBIT H
UNREGISTERED SECURITIES LEGEND
The Privately Placed Certificates will bear a legend (the "Unregistered
Securities Legend") to the following effect, unless the Certificate Registrar
determines otherwise in accordance with applicable law:
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE 1933 ACT
AND OTHER APPLICABLE LAWS AND ONLY (A)(1) PURSUANT TO RULE 144A UNDER
THE 1933 ACT TO AN INSTITUTIONAL INVESTOR THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE
144A (A "QIB") PURCHASING FOR ITS OWN ACCOUNT OR A PERSON PURCHASING
FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A OR (2) TO AN INSTITUTION THAT IS AN "ACCREDITED
INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) OF
REGULATION D UNDER THE 1933 ACT AND (B) IN ACCORDANCE WITH ANY OTHER
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.
Notwithstanding anything to the contrary, the Residual Certificates
shall not bear clause (A)(2) of the Unregistered Securities Legend.
H-1
<PAGE> 405
EXHIBIT I
- --------------------------------------------------------------------------------
LA SALLE NATIONAL BANK
as Trustee under the Pooling and Servicing Agreement
Seller
and
MIDLAND COMMERCIAL FINANCING CORP.
Participant
--------------------
PARTICIPANT AGREEMENT
Dated as of December 1, 1995
--------------------
- --------------------------------------------------------------------------------
<PAGE> 406
This Participation Agreement, dated as of December 1, 1995, is executed
by and among LaSalle National Bank, as Trustee under the Pooling and Servicing
Agreement, as Seller (together with its successors and assigns, the "Seller"),
and Midland Commercial Financing Corp., as Participant (together with its
successors and assigns, the "Participant").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Participant has agreed to purchase from the Seller and the
Seller has agreed to sell to the Participant a 49.3% participation interest in
the Seaport Loan in exchange for the Class N-P Certificate previously issued
under that certain Pooling and Servicing Agreement, dated as of July 1, 1995,
among Prudential Securities Secured Financing Corporation, as Depositor,
Midland Loan Services, L.P., as Servicer and Special Servicer, LaSalle National
Bank, as Trustee and Custodian, and ABN AMRO Bank N.V., as Fiscal Agent of the
Trustee, as amended by Amendment No. 1 to the Pooling and Servicing Agreement,
dated as of December 1, 1995, among Prudential Securities Secured Financing
Corporation, as Depositor, Midland Loan Services, L.P., as Servicer and Special
Servicer, LaSalle National Bank, as Trustee and Custodian, and ABN AMRO Bank
N.V., as Fiscal Agent of the Trustee, which Class N-P Certificate represents
(immediately prior to the tender thereof for cancellation) a 49.3% undivided
beneficial ownership interest in the Seaport Loan; and
WHEREAS, the Seller and the Participant wish to prescribe the manner of
execution and delivery of the Participation and the Participation Certificate
and the management, servicing and control of the Seaport Loan.
NOW, THEREFORE, in consideration of the above recitals which are made a
contractual part hereof, and in consideration of the mutual agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the Seller and the
Participant agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, capitalized terms, unless defined herein or the
context otherwise requires, shall have the meanings assigned to such terms in
the Pooling and Servicing Agreement, and the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
Agreement: This Participation Agreement and all amendments hereof
and supplements hereto.
Participation: As evidenced by the Participation Certificate, a 49.3%
participation interest in the Seaport Loan and in all security for the
repayment of the Seaport Loan.
<PAGE> 407
Participation Certificate: The certificate evidencing the Participant's
interest in the Seaport Loan executed and delivered by the Seller in
substantially the form annexed hereto as Exhibit A.
Pooling and Servicing Agreement: That certain Amended and Restated
Pooling and Servicing Agreement, dated as of December 1, 1995, among Prudential
Securities Secured Financing Corporation, as Depositor, Midland Loan Services,
L.P., as Servicer, Lennar Partners, Inc., as Special Servicer (who was appointed
to such position pursuant to the Appointment and Assumption Agreement, dated as
of December 6, 1995, among Midland Loan Services, L.P. and Lennar Securities
Holdings, Inc., as the holders, in the aggregate, of 100% Percentage Interest of
the Class G Certificates, LaSalle National Bank, as Trustee, and Lennar
Partners, Inc. as Assumptor), LaSalle National Bank, as Trustee and Custodian,
and ABN AMRO Bank N.V., as Fiscal Agent of the Trustee, as the same may be
amended and supplemented from time to time pursuant to the terms thereof.
The terms described in this Agreement shall include the plural as well
as the singular, and the use of any gender herein shall be deemed to include
the other gender.
ARTICLE II
PURCHASE AND SALE OF PARTICIPATION
Section 2.01 Agreement to Purchase and Sell.
In consideration of and in exchange for the tender by the Participant
to the Seller of the Class N-P Certificate, the tender and cancellation of
which are hereby acknowledged by the Seller, the Seller, simultaneously with
the execution and delivery of and subject to the terms and provisions of this
Agreement, does hereby sell, transfer, assign, set over and convey to the
Participant, without recourse to the Seller and without representation and
warranty of any kind by the Seller (except those representations and warranties
set forth in Section 3.01), and the Participant hereby purchases and accepts
from the Seller, the Participation.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 3.01 Representations and Warranties.
Each of the parties hereto hereby represents and warrants to the other
party as of date hereof that:
2
<PAGE> 408
(a) Each of the parties hereto intends the transaction
contemplated by this Agreement to be a purchase and sale of an undivided
interest in the Seaport Loan; and
(b) Each of the parties hereto does not intend the transaction
contemplated by this Agreement to be a loan by the Participant to the
Seller or a sale of securities to or a purchase of securities by the
Participant.
Section 3.02 Covenant of Participant.
The Participant hereby covenants and agrees to remit to the Special
Servicer (in the case of clause (i) below) or the Servicer (in the case of
clauses (ii) or (iii) below), as applicable, an amount equal to the
Participant's proportionate share of (i) the fees and expenses payable to the
Special Servicer under the Pooling and Servicing Agreement in the event the
Seaport Loan becomes a Specially Serviced Mortgage Loan, which fees and
expenses shall be deemed to be the same fees and expenses for which the Special
Servicer would be entitled if the Seaport Loan was owned by the Trust Fund
without the Participation, (ii) the amount of any Property Advances incurred
with respect to the Seaport Loan that have been deemed to be Nonrecoverable
Advances, and (iii) the Advanced Interest Amount which has accrued on any
unreimbursed Property Advances incurred with respect to the Seaport Loan. The
Participant shall remit such amount promptly upon the Participant's receipt of
an itemized invoice therefor; provided, however, that in lieu of the
Participant remitting such amounts to the Special Servicer or the Servicer, as
applicable, the Seller, at its option, may offset such amounts against the
amount of any remittances payable hereunder to the Participant in respect of
its Participation.
ARTICLE IV
PARTICIPATION CERTIFICATE
Section 4.01 The Participation Certificate.
Contemporaneously with the execution of this Agreement and the tender
and cancellation of the Class N-P Certificate, the Seller shall execute and
deliver the Participation Certification to the Participant.
Section 4.02 Transfer of Participation.
The Participant shall notify the Seller of any sale, transfer or
assignment of the Participation, the Participation Certificate or its rights
under this Agreement. Upon its receipt of such notice from such Participant and
subject to the tender by such Participant to the Seller and the subsequent
cancellation by the Seller of the Participation Certificate, the Seller shall
execute and deliver a new Participation Certificate to the Person designated in
writing by the such Participant as the new holder of the Participation and the
successor
3
<PAGE> 409
Participant hereunder. In the event the Participant sub-participates the
Participation, the Participation Certificate or its rights under this
Agreement, the Seller shall not be obligated to recognize any
sub-participant resulting therefrom, and the Seller shall continue to make
remittances in respect of the Participation and provide any statements, reports
or other information to such Participant pursuant to the terms and provisions
hereof.
ARTICLE V
ADMINISTRATION AND SERVICING OF SEAPORT LOAN
Section 5.01 Sole Administration by Seller.
The Seller shall hold all of the related Mortgage Loan Documents for
the benefit of itself and the Participant in accordance with their respective
interests in the Seaport Loan. It is understood and agreed by the parties
hereto that the Seller shall retain the sole and exclusive right with respect
to the enforcement, collection, disposition, transfer, assignment, servicing
and administration of the Seaport Loan and the related Mortgage Loan Documents,
and, in connection therewith, the Seller shall have the sole and exclusive
right to exercise and enforce all privileges and rights exercisable or
enforceable by the lender, payee, mortgagee or secured party thereunder for the
joint benefit of the Seller and the Participant, all in accordance with and
subject to the terms and provisions of the Pooling and Servicing Agreement.
Section 5.02 Acquisition of Title to Mortgaged Property.
In the event of the acquisition of title by the Seller to all or any
portion of the Mortgaged Property relating to the Seaport Loan, through
foreclosure or acceptance of a deed in lieu thereof, this Agreement shall
continue in full force and effect, and (i) the Participant shall continue to
have an participation interest in all or such portion of the related REO
Mortgage Loan equal to the Participant's proportionate share of the Seaport
Loan as of the date of such acquisition of title, and (ii) all decisions in
respect of the ownership, management, maintenance, operation, sale or other
disposition of all or such portion of the related REO Property shall be made by
the Seller, all in accordance with and subject to the terms and provisions of
the Pooling and Servicing Agreement.
Section 5.03 Liability of Seller.
The Seller shall have no duties or obligations to the Participant other
than as provided in this Agreement. The Participant acknowledges its receipt of
a copy of the Mortgage Loan Documents that relate to the Seaport Loan, and the
Seller does not assume and shall have no responsibility or liability, express
or implied, for the collectability, enforceability, or validity of the Seaport
Loan or the related Mortgage Loan Documents, nor for the financial condition of
the related Borrower or any obligor, indemnitor or guarantor under the Seaport
Loan.
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Section 5.04 Delegation of Duty.
All or any portion of the Seller's obligations under this Agreement,
including, without limitation, the Seller's obligation to make payments to the
Participant, may be delegated by the Seller to the Servicer or the Special
Servicer, as applicable, under and pursuant to the Pooling and Servicing
Agreement.
ARTICLE VI
PAYMENTS TO PARTICIPANT
Section 6.01 Remittances.
On each Remittance Date, the Seller shall remit to the Participant an
amount equal to the Non-Pooled Available Funds. Under the Seller receives
written notice from the Participant of the sale, transfer or assignment of the
Participation, the Participation Certificate or the Participant's rights under
this Agreement, the Participant as identified on the books and records of the
Seller as the holder of the Participation Certificate shall be presumed to be
the holder of such Participation and the Seller shall continue to make
remittances in respect of such Participation to such Participant pursuant to
the terms and provisions hereof.
Section 6.02 Statements to Participant.
The Seller shall provide to the Participant (as identified on the books
and records of the Seller as the holder of the Participation Certificate) such
statements, reports and other information with respect to the Seaport Loan as
are provided to the Certificateholders under the Pooling and Servicing
Agreement with respect to the Mortgage Loans at the same time and in the same
manner as is required under the Pooling and Servicing Agreement.
ARTICLE VII
TERMINATION
Section 7.01 Termination.
This Agreement shall terminate upon either: (i) the later of the final
payment or other liquidation of the Seaport Loan (which liquidation shall
include, without limitation, any repurchase or sale of the Seaport Loan as
required or permitted under the Pooling or Servicing Agreement) or the
disposition of any related REO Property and the remittance of all funds due
hereunder; or (ii) the mutual consent of the Seller and the Participant in
writing.
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<PAGE> 411
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01 Amendment.
This Agreement may be amended from time to time by the Seller and the
Participant only by written agreement executed by the Seller and the
Participant.
Section 8.02 Governing Law.
This Agreement shall be construed in accordance with the laws of the
State of New York, and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 8.03 Notices.
All demands, notices and communications hereunder shall be in writing
and shall be deemed to have been duly given upon receipt by the recipient (or,
in the case of notice by telecopy, upon confirmation by receipt) as follows:
(i) if to the Seller, at the address of the Trustee as set
forth in the Pooling and Servicing Agreement, or such
other address as may hereafter be furnished to the
Participant in writing by the Seller;
(ii) if to the Participant, at the address as set forth in
the Participation Certificate, or such other address
as may hereafter be furnished to the Seller in writing
by the Participant;
Section 8.04 Severvability of Provisions.
If any one or more of the covenant, agreements, provisions or terms of
this Agreement shall be held invalid for any reason whatsoever, 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 (subject to the final sentence of this Section). To the extent
permitted by applicable law, the parties hereto waive any provision of law which
prohibits or renders void, voidable or unenforceable any provision hereof. If
the invalidity of any part, provision, representation or warranty of this
Agreement shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate, in good faith, to
revise or amend the Agreement to achieve an economic effect as close as possible
to the economic effect of this Agreement without regard to such invalidity.
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<PAGE> 412
Section 8.05 Execution: Successors and Assigns.
This Agreement may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same Agreement. This Agreement shall inure to the
benefit of and be binding upon the Seller and the Participant and their
respective successors and assigns.
<PAGE> 413
IN WITNESS WHEREOF, the Seller and the Participant have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first above written.
LASALLE NATIONAL BANK, as Trustee under the
Pooling and Servicing Agreement,
as Seller
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
MIDLAND COMMERCIAL FINANCING CORP.
as Participant
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
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<PAGE> 414
EXHIBIT A
PARTICIPATION CERTIFICATE
LASALLE NATIONAL BANK, as Trustee under the Pooling and Servicing
Agreement, hereby certifies that _____________________________________________,
whose mailing address is _____________________________________________________,
is entitled to a 49.3% participation interest in the Seaport Loan and in all
security for the repayment of the Seaport Loan.
To the extent not defined herein, the capitalized terms used herein
shall have the meanings assigned to such terms in that certain Participation
Agreement, dated as of December 1, 1995, among the LaSalle National Bank, as
Trustee under the Pooling and Servicing Agreement, as Seller, and Midland
Commercial Financing Corp., as Participant (together with any amendments
thereof and supplements thereto, the "Agreement").
This Participation Certificate is executed and delivered under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the holder of this Participation Certificate by virtue of its
acceptance hereof assents and by which such holder is bound.
IN WITNESS WHEREOF, the Seller has caused this Participation
Certificate to be duly executed as of the date set forth below.
LASALLE NATIONAL BANK, as Trustee under the
Pooling and Servicing Agreement
By: ___________________________________
Name: _________________________________
Title: ________________________________
Date: _________________________________
