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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported): May 28, 1998
FIRST UNION COMMERCIAL MORTGAGE SECURITIES, INC.
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(Exact name of registrant as specified in its governing instruments)
Delaware 333-48943 56-1643598
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
One First Union Center
Charlotte, North Carolina 28228-0600
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(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (704) 374-6828
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Item 1, Items 3 through 6, and Items 8 and 9 are not included because they
are not applicable.
Item 2. Acquisition or Disposition of Assets.
On May 28, 1998, a single series of mortgage pass-through certificates,
entitled First Union - Lehman Brothers - Bank of America Commercial Mortgage
Trust, Commercial Mortgage Pass-Through Certificates, Series 1998-C2 (the
"Certificates"), was issued pursuant to a pooling and servicing agreement
(the "Pooling Agreement") attached hereto as Exhibit 4.1 and dated as of May
1, 1998, among First Union Commercial Mortgage Securities, Inc. as depositor
(the "Registrant"), First Union National Bank as master servicer, CRIIMI MAE
Services Limited Partnership as special servicer and Norwest Bank National
Association as trustee. The Certificates consist of eighteen classes (each,
a "Class") of Certificates, seven of which Classes are designated as the
"Class A-1 Certificates", the "Class A-2 Certificates", the "Class B
Certificates", the "Class C Certificates", the "Class D Certificates", the
"Class E Certificates" and the "Class IO Certificates" (collectively, the
"Offered Certificates"); and ten of which Classes are designated as the
"Class F Certificates", the "Class G Certificates", the "Class H
Certificates", the "Class J Certificates", the "Class K Certificates", the
"Class L Certificates", the "Class M Certificates", the "Class N
Certificates", the "Class R-I Certificates", the "Class R-II Certificates"
and the "Class R-III Certificates" (collectively, the "Private
Certificates"). The Certificates evidence in the aggregate the entire
beneficial ownership interest in a trust fund (the "Trust Fund") consisting
primarily of 664 multifamily and commercial mortgage loans (the "Mortgage
Loans") having an aggregate principal balance as of May 1, 1998 (the "Cut-off
Date") of $3,408,048,239. Each Mortgage Loan is secured by a mortgage lien on
a fee or leasehold interest in an income producing property. Two hundred
seventy-three (273) of the Mortgage Loans (the "Lehman Loans") were acquired
by the Registrant from an affiliate of Lehman Brothers Inc. (the "Lehman
Seller"), two hundred seventy-one (271) of the Mortgage Loans (the "FUNB
Loans") were acquired by the Registrant from First Union National Bank ("FUNB
Seller") and one hundred and twenty (120) of the Mortgage Loans (the "Bank of
America Loans") were acquired by the Registrant from Bank of America NT&SA
("Bank of America Seller" and together with the Lehman Seller and the FUNB
Seller, the "Sellers") pursuant to three Mortgage Loan Purchase Agreements,
each dated as of May 1, 1998 (the "Purchase Agreements"), between the
Registrant and each of the Sellers. The purchase prices (collectively the
"Purchase Price") for the Lehman Loans, the FUNB Loans and the Bank of
America Loans paid by the Registrant to the Sellers was $1,774,790,381,
$1,391,988,263 and $343,641,549, respectively. The source of funds for
payment of the Purchase Price was the proceeds derived from the sale of the
Certificates by the Registrant to Lehman Brothers Inc. ("LBI") and First
Union Capital Markets, a division of Wheat First Securities ("First Union")
pursuant to an Underwriting Agreement, dated as of May 21, 1998 (the
"Underwriting Agreement"), among the Registrant, LBI and First Union
(pertaining to the Offered Certificates) and a Certificate Purchase
Agreement, dated as of May 28, 1998, among the Registrant, LBI and First
Union (pertaining to the Private Certificates). The Registrant is a
wholly-owned limited purpose finance subsidiary of First Union. On May 28,
1998, the Registrant transferred the Mortgage Loans to the Trust Fund
pursuant to the Pooling Agreement. The consideration received by the
Registrant in exchange for such transfer consisted of the Certificates.
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The Offered Certificates and the Mortgage Loans are more particularly
described in the Prospectus, dated May 11, 1998, and the Prospectus
Supplement, dated May 21, 1998, as previously filed with the Securities and
Exchange Commission pursuant to Rule 424(b)(5). Capitalized terms used but
not otherwise defined herein have the meanings set forth in the Prospectus
Supplement.
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Item 7. Financial Statements and Exhibits
(a) Financial Statements - Not Applicable
(b) Pro Forma Financial Information - Not Applicable
(c) Exhibits
<TABLE>
<CAPTION>
<C> <S>
1.1 Underwriting Agreement, dated as of May 28, 1998, among
First Union Commercial Mortgage Securities, Inc., Lehman
Brothers Inc. and First Union Capital Markets.
4.1 Pooling and Servicing Agreement, dated as of May 1, 1998,
among First Union Commercial Mortgage Securities, Inc. as
depositor, First Union National Bank as master servicer,
CRIIMI MAE Services Limited Partnership as special
servicer, and Norwest Bank National Association as
trustee.
99.1 Mortgage Loan Purchase Agreement, dated as of May 1,
1998, between First Union Commercial Mortgage Securities,
Inc. and Lehman Brothers Holdings Inc.
99.2 Mortgage Loan Purchase Agreement, dated as of May 1,
1998, between First Union Commercial Mortgage Securities,
Inc. and First Union National Bank
99.3 Mortgage Loan Purchase Agreement, dated as of May 1,
1998, between First Union Commercial Mortgage Securities,
Inc. and Bank of America NT&SA.
99.4 Tax Opinion of Willkie Farr & Gallagher dated May 28,
1998.
</TABLE>
4
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FIRST UNION COMMERCIAL MORTGAGE
SECURITIES, INC.
By: /s/ Brain Simpson
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Name: Brian Simpson
Title: Senior Vice President
Dated: May 28, 1998
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EXHIBIT INDEX
The following exhibits are being filed herewith:
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<C> <S>
1.1 Underwriting Agreement, dated as of May 28, 1998, among
First Union Commercial Mortgage Securities, Inc., Lehman
Brothers Inc. and First Union Capital Markets.
4.1 Pooling and Servicing Agreement, dated as of May 1, 1998,
among First Union Commercial Mortgage Securities, Inc. as
depositor, First Union National Bank as master servicer,
CRIIMI MAE Services Limited Partnership as special
servicer, and Norwest Bank National Association as
trustee.
99.1 Mortgage Loan Purchase Agreement, dated as of May 1,
1998, between First Union Commercial Mortgage Securities,
Inc. and Lehman Brothers Holdings Inc.
99.2 Mortgage Loan Purchase Agreement, dated as of May 1,
1998, between First Union Commercial Mortgage Securities,
Inc. and First Union National Bank
99.3 Mortgage Loan Purchase Agreement, dated as of May 1,
1998, between First Union Commercial Mortgage
Securities, Inc. and Bank of America NT&SA.
99.4 Tax Opinion of Willkie Farr & Gallagher dated May 28,
1998.
</TABLE>
6
<PAGE>
Exhibit 1.1
Execution
FIRST UNION COMMERCIAL MORTGAGE SECURITIES, INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1998-C2
UNDERWRITING AGREEMENT
Charlotte, North Carolina
May 21, 1998
Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
As Representative of the several
Underwriters named in Schedule
II hereto
Dear Sirs:
First Union Commercial Mortgage Securities, Inc., a North Carolina
corporation (the "Company"), proposes to issue its Commercial Mortgage
Pass-Through Certificates, Series 1998-C2 (the "Certificates"), in 18 classes
(each, a "Class") as designated in the Prospectus Supplement (as defined below).
The Company further proposes to sell to the Underwriters named in Schedule II
hereto, for whom you are acting as Representative, the Certificates set forth in
Schedule I hereto (the "Underwritten Certificates") in the respective original
principal and notional amounts set forth in Schedule I. The Certificates will
represent in the aggregate the entire beneficial ownership interest in a trust
fund (the "Trust Fund") consisting primarily of a segregated pool (the "Mortgage
Pool") of mortgage loans (the "Mortgage Loans") secured by first liens on the
borrowers' fee or leasehold interests in multifamily and commercial properties
(the "Mortgaged Properties"). The Trust Fund will be created, the Certificates
will be issued and the Mortgage Pool will be serviced and administered pursuant
to a pooling and servicing agreement (the "Pooling and Servicing Agreement"), to
be dated as of the Cut-off Date among the Company, First Union National Bank, as
master servicer (the "Master Servicer"), CRIIMI MAE Services Limited
Partnership, as special servicer (the "Special Servicer") and Norwest Bank
Minnesota, National Association, as trustee (the "Trustee"). Certain of the
Mortgage Loans (the "LBHI Mortgage Loans") are owned, as of the date hereof, by
Lehman Brothers Holdings Inc., doing business as Lehman Capital, a division of
Lehman Brothers Holdings Inc. ("LBHI"), certain other of the Mortgage Loans (the
"BofA Mortgage Loans") are owned, as of the date hereof, by Bank of America
NT&SA ("BofA") and the remainder of the Mortgage Loans (the "First Union
Mortgage Loans") are owned by First Union National Bank ("First Union"; and
together with LBHI and BofA, the "Mortgage Loan Sellers"). The Mortgage Loans
will be acquired by the Company, on
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or before the Closing Date (as hereinafter defined), pursuant to (i) in the case
of the LBHI Mortgage Loans, a mortgage loan purchase agreement (the "LBHI
Mortgage Loan Purchase Agreement"), dated as of May 1, 1998, between the Company
and LBHI, (ii) in the case of the First Union Mortgage Loans, a mortgage loan
purchase agreement (the "First Union Mortgage Loan Purchase Agreement"), dated
as of May 1, 1998, between First Union National Bank and the Company and (iii)
in the case of the BofA Mortgage Loans, a mortgage loan purchase agreement (the
"BofA Mortgage Loan Purchase Agreement"), dated as of May 1, 1998, between the
Company and BofA. The Underwritten Certificates and the Mortgage Pool are
described more fully in Schedule I hereto and in a registration statement
furnished to you by the Company.
Capitalized terms used but not otherwise defined herein shall have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
1. Representations and Warranties. (I) The Company represents and
warrants to, and agrees with, each Underwriter that:
(a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement (No. 333-48943) on
Form S-3 for the registration of Commercial Mortgage Pass-Through
Certificates, issuable in series, including the Underwritten Certificates,
under the Securities Act of 1933, as amended (the "1933 Act"), which
registration statement has become effective and a copy of which, as
amended to the date hereof, has heretofore been delivered to you. The
Company meets the requirements for use of Form S-3 under the 1933 Act, and
such registration statement, as amended at the date hereof, meets the
requirements set forth in Rule 415(a)(1)(x) under the 1933 Act and
complies in all other material respects with the 1933 Act and the rules
and regulations thereunder. The Company proposes to file with the
Commission, with your consent, pursuant to Rule 424 under the 1933 Act, a
supplement dated May 21, 1998 (the "Prospectus Supplement") to the
prospectus dated May 11, 1998 (the "Basic Prospectus"), relating to the
Underwritten Certificates and the method of distribution thereof, and has
previously advised you of all further information (financial and other)
with respect to the Underwritten Certificates and the Mortgage Pool to be
set forth therein. Such registration statement (No. 333-48943), including
all exhibits thereto, is referred to herein as the "Registration
Statement"; and the Basic Prospectus and the Prospectus Supplement,
together with any amendment thereof or supplement thereto authorized by
the Company prior to the Closing Date for use in connection with the
offering of the Underwritten Certificates, are hereinafter called the
"Prospectus". Any preliminary form of the Prospectus Supplement that has
heretofore been filed pursuant to Rule 424 or, prior to the effective date
of the Registration Statement, pursuant to Rule 402(a) or 424(a), is
hereinafter called a "Preliminary Prospectus Supplement". If so stated in
the Prospectus Supplement, the Company will file with the Commission
within fifteen days of the issuance of the Underwritten Certificates a
report on Form 8-K ("8-K") setting forth specific information concerning
the Mortgage Pool and the Underwritten Certificates to the extent that
such information is not set forth in the Prospectus Supplement.
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(b) As of the date hereof, as of the date on which the Prospectus
Supplement is first filed pursuant to Rule 424 under the 1933 Act, as of
the date on which, prior to the Closing Date, any amendment to the
Registration Statement becomes effective, as of the date on which any
supplement to the Prospectus Supplement is filed with the Commission, and
as of the Closing Date, (i) the Registration Statement, as amended as of
any such time, and the Prospectus, as amended or supplemented as of any
such time, complies and will comply in all material respects with the
applicable requirements of the 1933 Act and the rules and regulations
thereunder, (ii) the Registration Statement, as amended as of any such
time, does not contain and will not contain any untrue statement of a
material fact and does not omit and will not omit to state any material
fact required to be stated therein or necessary in order to make the
statements therein not misleading, and (iii) the Prospectus, as amended or
supplemented as of any such time, does not contain and will not contain
any untrue statement of a material fact and does not omit and will not
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no representations
or warranties as to statements contained in or omitted from the
Registration Statement or the Prospectus or any amendment or supplement
thereto made in reliance upon and in conformity with information furnished
in writing to the Company by or on behalf of any Underwriter through you
specifically for use in the Registration Statement and the Prospectus
(such information being identified in Section 8(b)).
(c) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of North
Carolina with corporate power and authority to own, lease or operate its
properties and to conduct its business as now conducted by it and to enter
into and perform its obligations under this Agreement and the Pooling and
Servicing Agreement; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business.
(d) As of the date hereof, as of the date on which the Prospectus
Supplement is first filed pursuant to Rule 424 under the 1933 Act, as of
the date on which, prior to the Closing Date, any amendment to the
Registration Statement becomes effective, as of the date on which any
supplement to the Prospectus Supplement is filed with the Commission, and
as of the Closing Date, there has not and will not have been (i) any
request by the Commission for any further amendment to the Registration
Statement or the Prospectus or for any additional information, (ii) any
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the institution or threat of any
proceeding for that purpose or (iii) any notification with respect to the
suspension of the qualification of the Underwritten Certificates for sale
in any jurisdiction or any initiation or threat of any proceeding for such
purpose.
(e) This Agreement has been duly authorized, executed and delivered
by the Company, and the Pooling and Servicing Agreement, when executed and
delivered as
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contemplated hereby and thereby, will have been duly authorized, executed
and delivered by the Company; and this Agreement constitutes, and the
Pooling and Servicing Agreement, when so executed and delivered will
constitute, legal, valid and binding agreements of the Company,
enforceable against the Company in accordance with their respective terms,
except as enforceability may be limited by (i) bankruptcy, insolvency,
reorganization, receivership, moratorium or other similar laws affecting
the enforcement of the rights of creditors generally, (ii) general
principles of equity, whether enforcement is sought in a proceeding in
equity or at law, and (iii) public policy considerations underlying the
securities laws, to the extent that such public policy considerations
limit the enforceability of the provisions of this Agreement or the
Pooling and Servicing Agreement that purport to provide indemnification
from securities law liabilities.
(f) As of the Closing Date, the Underwritten Certificates and the
Pooling and Servicing Agreement will conform in all material respects to
the respective descriptions thereof contained in the Prospectus. As of the
Closing Date, the Underwritten Certificates will be duly and validly
authorized and, when duly and validly executed, authenticated and
delivered in accordance with the Pooling and Servicing Agreement to you
against payment therefor as provided herein, will be duly and validly
issued and outstanding and entitled to the benefits of the Pooling and
Servicing Agreement.
(g) As of the Closing Date, each of the Mortgage Loans will meet the
criteria for selection described in the Prospectus, and on the Closing
Date the representations and warranties of the Company with respect to the
Mortgage Loans contained in the Pooling and Servicing Agreement will be
true and correct in all material respects.
(h) The Company is not in violation of its certificate of
incorporation or by-laws or in default under any agreement, indenture or
instrument the effect of which violation or default would be material to
the Company or which violation or default would have a material adverse
affect on the performance of its obligations under this Agreement or the
Pooling and Servicing Agreement. Neither the issuance and sale of the
Underwritten Certificates, nor the execution and delivery by the Company
of this Agreement or the Pooling and Servicing Agreement, nor the
consummation by the Company of any of the transactions herein or therein
contemplated, nor compliance by the Company with the provisions hereof or
thereof, does or will conflict with or result in a breach of any term or
provision of the certificate of incorporation or by-laws of the Company or
conflict with, result in a breach, violation or acceleration of, or
constitute a default under, the terms of any indenture or other agreement
or instrument to which the Company is a party or by which it or any
material asset is bound, or any statute, order or regulation applicable to
the Company of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Company.
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(i) There is no action, suit or proceeding against the Company
pending, or, to the knowledge of the Company, threatened, before any
court, arbitrator, administrative agency or other tribunal (i) asserting
the invalidity of this Agreement, the Pooling and Servicing Agreement or
the Underwritten Certificates, (ii) seeking to prevent the issuance of the
Underwritten Certificates or the consummation of any of the transactions
contemplated by this Agreement or the Pooling and Servicing Agreement,
(iii) that might materially and adversely affect the performance by the
Company of its obligations under, or the validity or enforceability of,
this Agreement, the Pooling and Servicing Agreement or the Underwritten
Certificates or (iv) seeking to affect adversely the federal income tax
attributes of the Underwritten Certificates as described in the
Prospectus.
(j) There are no contracts, indentures or other documents of a
character required by the 1933 Act or by the rules and regulations
thereunder to be described or referred to in the Registration Statement or
the Prospectus or to be filed as exhibits to the Registration Statement
which have not been so described or referred to therein or so filed or
incorporated by reference as exhibits thereto.
(k) No authorization, approval or consent of any court or
governmental authority or agency is necessary in connection with the
offering, issuance or sale of the Underwritten Certificates pursuant to
this Agreement and the Pooling and Servicing Agreement, except such as
have been, or as of the Closing Date will have been, obtained or such as
may otherwise be required under applicable state securities laws in
connection with the purchase and offer and sale of the Underwritten
Certificates by the Underwriters and any recordation of the respective
assignments of the Mortgage Loans to the Trustee pursuant to the Pooling
and Servicing Agreement that have not been completed.
(l) The Company possesses all material licenses, certificates,
authorities or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by it, and the Company has not received any notice of proceedings
relating to the revocation or modification of any such license,
certificate, authority or permit which, singly or in the aggregate, if the
subject of any unfavorable decision, ruling or finding, would materially
and adversely affect the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company.
(m) Any taxes, fees and other governmental charges in connection
with the execution and delivery of this Agreement and the Pooling and
Servicing Agreement or the execution, delivery and sale of the
Underwritten Certificates (other than such federal, state and local taxes
as may be payable on the income or gain recognized therefrom) have been or
will be paid at or prior to the Closing Date.
(n) Immediately prior to the assignment of the Mortgage Loans to the
Trustee, the Company will have good title to, and will be the sole owner
of, each
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Mortgage Loan, free and clear of any pledge, mortgage, lien, security
interest or other encumbrance.
(o) Neither the Company nor the Trust Fund is, and neither the
issuance and sale of the Underwritten Certificates in the manner
contemplated by the Prospectus nor 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 (the "Investment Company Act").
(p) Under generally accepted accounting principles ("GAAP") and for
federal income tax purposes, the Company will report the transfer of the
Mortgage Loans to the Trustee in exchange for the Underwritten
Certificates and the sale of the Underwritten Certificates to the
Underwriters pursuant to this Agreement as a sale of the interests in the
Mortgage Loans evidenced by the Underwritten Certificates. The
consideration received by the Company upon the sale of the Underwritten
Certificates to the Underwriters will constitute reasonably equivalent
value and fair consideration for the Underwritten Certificates. The
Company will be solvent at all relevant times prior to, and will not be
rendered insolvent by, the sale of the Underwritten Certificates to the
Underwriters and the transfer of the Mortgage Loans to the Trustee on
behalf of the Trust Fund. The Company is not selling the Underwritten
Certificates to the Underwriters or transferring the Mortgage Loans to the
Trustee on behalf of the Trust Fund with any intent to hinder, delay or
defraud any of the creditors of the Company.
(q) At the Closing Date, the respective classes of Underwritten
Certificates shall have been assigned ratings no lower than those set
forth in Schedule I hereto by the nationally recognized statistical rating
organizations identified in Schedule I hereto (individually and
collectively, the "Rating Agency").
(r) At the Closing Date, each of the representations and warranties
of the Company set forth in the Pooling and Servicing Agreement will be
true and correct in all material respects.
(II) Each Underwriter represents and warrants to the Company that,
as of the date hereof and as of the Closing Date, (i) such Underwriter has
complied in all material respects with all of its obligations under Section 4
hereof and (ii) with respect to all Computational Materials and ABS Term Sheets,
if any, provided by such Underwriter to the Company pursuant to Section
4(b)(iv), such Computational Materials and ABS Term Sheets are accurate in all
material respects (taking into account the assumptions explicitly set forth or
otherwise referred to in the Computational Materials or ABS Term Sheets or in
the Prospectus Supplement or the Preliminary Prospectus Supplement, and provided
that the underlying data regarding the Mortgage Loans, and the related
Mortgagors and Mortgaged Properties, provided to the Underwriters by the
Mortgage Loan Sellers is accurate and complete in all material respects) and
constitute a complete set of all Computational Materials and ABS Term Sheets
that are required to be filed with the Commission pursuant to the No-Action
Letters (as defined herein).
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2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties set forth herein, the Company
agrees to sell to the Underwriters, and the Underwriters agree, severally and
not jointly, to purchase from the Company, at the applicable purchase prices set
forth in Schedule I hereto, the respective principal and notional amounts of the
Underwritten Certificates set forth opposite the name of each Underwriter set
forth in Schedule II hereto, and any additional portions of the Underwritten
Certificates that any such Underwriter may be obligated to purchase pursuant to
Section 10, in all cases plus accrued interest as set forth in Schedule I.
3. Delivery and Payment. Delivery of and payment for the
Underwritten Certificates shall be made in the manner, at the location(s), on
the date and at the time specified in Schedule I hereto (or such later date not
later than ten business days after such specified date as you shall designate),
which date and time may be changed by agreement between you and the Company or
as provided in Section 10 hereof (such date and time of delivery and payment for
the Underwritten Certificates being herein called the "Closing Date"). Delivery
of the Underwritten Certificates shall be made either directly to you or through
the facilities of The Depository Trust Company ("DTC"), as specified in Schedule
I hereto, for the respective accounts of the Underwriters against payment by the
respective Underwriters through you of the purchase price therefor in
immediately available funds wired to such bank as may be designated by the
Company, or such other manner of payment as may be agreed upon by the Company
and you. Any Class of Underwritten Certificates to be delivered through the
facilities of DTC shall be represented by one or more global Certificates
registered in the name of Cede & Co., as nominee of DTC, which global
Certificate(s) shall be placed in the custody of DTC not later than 10:00 a.m.
(New York City time) on the Closing Date pursuant to a custodial arrangement to
be entered into between the Trustee or its agent and DTC. Unless delivered
through the facilities of DTC, the Underwritten Certificates shall be in fully
registered certificated form, in such denominations and registered in such names
as you may have requested in writing not less than one full business day in
advance of the Closing Date.
The Company agrees to have the Underwritten Certificates, including
the global Certificates representing the Underwritten Certificates to be
delivered through the facilities of DTC, available for inspection, checking and,
if applicable, packaging by you in New York, New York, not later than the close
of business (New York City time) on the business day preceding the Closing Date.
References herein, including, without limitation, in the Schedules
hereto, to actions taken or to be taken following the Closing Date with respect
to any Underwritten Certificates that are to be delivered through the facilities
of DTC shall include, if the context so permits, actions taken or to be taken
with respect to the interests in such Certificates as reflected on the books and
records of DTC.
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4. Offering by Underwriters.
(a) It is understood that the Underwriters propose to offer the
Underwritten Certificates for sale to the public, including, without
limitation, in and from the State of New York, as set forth in the
Prospectus Supplement. It is further understood that the Company, in
reliance upon an exemption from the Attorney General of the State of New
York to be granted pursuant to Policy Statement 104 and 105, has not and
will not file the offering pursuant to Section 352-e of the General
Business Law of the State of New York with respect to the Underwritten
Certificates which are not "mortgage related securities" as defined in the
1934 Act (as defined below). Each of the Underwriters therefore covenants
and agrees with the Company that sales of the Class C, D and E
Certificates made by such Underwriter in and from the State of New York
will be made only to institutional investors within the meaning of Policy
Statement 105.
(b) Each Underwriter may prepare and provide to prospective
investors certain Computational Materials, Structural Term Sheets or
Collateral Term Sheets in connection with its offering of the
Certificates, subject to the following conditions:
(i) Such Underwriter shall comply with the requirements of the
no-action letter, dated May 20, 1994, issued by the Commission to
Kidder, Peabody Acceptance Corporation I, Kidder, Peabody & Co.
Incorporated and Kidder Structured Asset Corporation, as made
applicable to other issuers and underwriters by the Commission in
response to the request of the Public Securities Association, dated
May 25, 1994 (collectively, the "Kidder/PSA Letter"), and the
requirements of the no-action letter, dated February 17, 1995,
issued by the Commission to the Public Securities Association (the
"PSA Letter" and, together with the Kidder/PSA Letter, the
"No-Action Letters").
(ii) For purposes hereof, "Computational Materials" shall have
the meaning given such term in the No-Action Letters, but shall
include only those Computational Materials that have been prepared
or delivered to prospective investors by or at the direction of such
Underwriter. For purposes hereof, "ABS Term Sheets," "Structural
Term Sheets" and "Collateral Term Sheets" shall have the meanings
given such terms in the PSA Letter but shall include only those ABS
Term Sheets, Structural Term Sheets or Collateral Term Sheets that
have been prepared for or delivered to prospective investors by or
at the direction of such Underwriter.
(iii) All Computational Materials and ABS Term Sheets provided
to prospective investors shall bear a legend in a form previously
approved by the Company or its counsel.
(iv) Such Underwriter shall not distribute any such
Computational Materials or ABS Term Sheets unless the forms and
methodology thereof are in accordance with this Agreement. Such
Underwriter shall provide to the
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Company, for filing on Form 8-K as provided in Section 5(g), copies
(in such format as required by the Company) of all Computational
Materials and ABS Term Sheets. The Underwriter may provide copies of
the foregoing in a consolidated or aggregated form including all
information required to be filed. All Computational Materials and
ABS Term Sheets described in this subsection (iv) must be provided
to the Company (a) in paper or electronic format suitable for filing
with the Commission and (b) not later than 10:00 a.m. (New York City
time) on a business day that is not less than one business day
before filing thereof is required pursuant to the terms of the
No-Action Letters.
(v) All information included in the Computational Materials
and ABS Term Sheets shall be generated based on substantially the
same methodology and assumptions as are used to generate the
information in the Prospectus Supplement as set forth therein;
provided that the Computational Materials and ABS Term Sheets may
include information based on alternative methodologies or
assumptions if specified therein. If any Computational Materials or
ABS Term Sheets were based on assumptions with respect to the
Mortgage Pool that differ from the final Pool Information in any
material respect or on Underwritten Certificate structuring
assumptions (except in the case of Computational Materials when the
different structuring terms were hypothesized and so described) that
were revised in any material respect prior to the printing of the
Prospectus, then to the extent that it has not already done so, such
Underwriter shall immediately inform the Company and, upon the
direction of the Company, and if not corrected by the Prospectus,
shall prepare revised Computational Materials and ABS Term Sheets,
as the case may be, based on the final Pool Information and
structuring assumptions, circulate such revised Computational
Materials and ABS Term Sheets to all recipients of the preliminary
versions thereof, and include such revised Computational Materials
and ABS Term Sheets (marked, "as revised") in the materials
delivered to the Company pursuant to subsection (iv) above.
(vi) The Company shall not be obligated to file any
Computational Materials or ABS Term Sheets that have been determined
to contain any material error or omission, provided that the Company
will file Computational Materials or ABS Term Sheets that contain a
material error or, when read together with the Prospectus, a
material omission if clearly marked (A) "superseded by materials
dated ____________ __" and accompanied by corrected Computational
Materials or ABS Term Sheets that are marked "material previously
dated ___________ __, as corrected", or (B) if the material error or
omission is to be corrected in the Prospectus, "superseded by
materials contained in the Prospectus." If, within the period during
which the Prospectus relating to the Underwritten Certificates is
required to be delivered under the 1933 Act, any Computational
Materials or ABS Term Sheets are determined, in the reasonable
judgment of the Company or such Underwriter, to contain a material
error or, when read together with the Prospectus, a material
omission,
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then (unless the material error or omission was corrected in the
Prospectus) the Underwriter shall prepare a corrected version of
such Computational Materials or ABS Term Sheets, shall circulate
such corrected Computational Materials or ABS Term Sheets to all
recipients of the prior versions thereof, and shall deliver copies
of such corrected Computational Materials or ABS Term Sheets
(marked, "as corrected") to the Company for filing with the
Commission in a subsequent Form 8-K submission (subject to the
Company's obtaining an accountant's comfort letter in respect of
such corrected Computational Materials and ABS Term Sheets, which
shall be at the expense of such Underwriter).
(vii) Such Underwriter shall be deemed to have represented, as
of the Closing Date, that except for Computational Materials and/or
ABS Term Sheets provided to the Company pursuant to subsection (iv)
above, such Underwriter did not provide any prospective investors
with any information in written or electronic form in connection
with the offering of the Underwritten Certificates that is required
to be filed with the Commission in accordance with the No-Action
Letters.
(viii) In the event of any delay in the delivery by such
Underwriter to the Company of all Computational Materials and ABS
Term Sheets required to be delivered in accordance with subsection
(iv) above, the Company shall have the right to delay the release of
the Prospectus to investors or to the Underwriter, to delay the
Closing Date and to take other appropriate actions in each case as
necessary in order to allow the Company to comply with its agreement
set forth in Section 5(g) to file the Computational Materials and
ABS Term Sheets by the time specified therein.
(ix) Computational Materials and ABS Term Sheets may be
distributed by the Underwriter through electronic means in
accordance with SEC Release No. 33-7233 (the "Release").
(c) Each Underwriter further agrees that it shall promptly provide
the Company with such information as to matters of fact as the Company may
reasonably request to enable it to comply with its reporting requirements
with respect to each class of Underwritten Certificates to the extent such
information can in the good faith judgment of the Underwriter be
determined by it.
5. Covenants of the Company. The Company covenants and agrees with
the Underwriters that:
(a) The Company will not file any amendment to the Registration
Statement or any supplement to the Basic Prospectus relating to or
affecting the Underwritten Certificates, unless the Company has furnished
a copy to you for your review prior to filing, and will not file any such
proposed amendment or supplement to which you reasonably object. Subject
to the foregoing sentence, the Company will cause the
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Prospectus Supplement to be transmitted to the Commission for filing
pursuant to Rule 424 under the 1933 Act or will cause the Prospectus
Supplement to be filed with the Commission pursuant to said Rule 424. The
Company promptly will advise you or counsel for the Underwriters (i) when
the Prospectus Supplement shall have been filed or transmitted to the
Commission for filing pursuant to Rule 424, (ii) when any amendment to the
Registration Statement shall have become effective, (iii) of any request
by the Commission to amend the Registration Statement or supplement the
Prospectus Supplement or for any additional information in respect of the
offering contemplated hereby, (iv) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement
or any post-effective amendment thereto which shall have become effective
on or prior to the Closing Date or the institution or threatening of any
proceeding for that purpose, and (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Underwritten Certificates for sale in any jurisdiction or the institution
or threatening of any proceeding for that purpose. The Company will use
its best efforts to prevent the issuance of any such stop order or
suspension and, if issued, to obtain as soon as possible the withdrawal
thereof.
(b) If, at any time when a prospectus relating to the Underwritten
Certificates is required to be delivered under the 1933 Act, any event
occurs as a result of which the Prospectus, as then amended or
supplemented, would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, or if it shall be necessary to amend or supplement the
Prospectus to comply with the 1933 Act or the rules and regulations
thereunder, the Company promptly will prepare and file with the
Commission, at the expense of the Company, subject to paragraph (a) of
this Section 5, an amendment or supplement that will correct such
statement or omission or an amendment that will effect such compliance
and, if such amendment or supplement is required to be contained in a
post-effective amendment to the Registration Statement, the Company will
use its best efforts to cause such amendment to the Registration Statement
to be made effective as soon as possible.
(c) The Company will furnish to you and to counsel for the
Underwriters, without charge, signed copies of the Registration Statement
(including exhibits thereto) and each amendment thereto which shall become
effective on or prior to the Closing Date, and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and each
such amendment and, so long as delivery of a prospectus by an Underwriter
or dealer may be required by the 1933 Act, as many copies of any
Preliminary Prospectus Supplement, the Prospectus Supplement and the Basic
Prospectus and any amendments and supplements thereto as you may
reasonably request.
(d) The Company will furnish such information, execute such
instruments and take such action, if any, as may be required to qualify
the Underwritten Certificates for sale under the laws of such
jurisdictions as you may designate and will
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<PAGE>
maintain such qualifications in effect so long as required for the
distribution of the Underwritten Certificates; provided, however, that the
Company shall not be required to qualify to do business in any
jurisdiction where it is not now qualified or to take any action that
would subject it to general or unlimited service of process in any
jurisdiction where it is not now subject to such service of process.
(e) The Company will pay, or cause to be paid, all costs and
expenses in connection with the transactions herein contemplated,
including, but not limited to, the fees and disbursements of its counsel;
the costs and expenses of printing (or otherwise reproducing) and
delivering the Pooling and Servicing Agreement and the Underwritten
Certificates; the fees and disbursements of accountants for the Company;
the costs and expenses in connection with the qualification or exemption
of the Underwritten Certificates under state securities or "blue sky"
laws, including filing fees and reasonable fees and disbursements of
counsel in connection therewith, in connection with the preparation of any
blue sky survey and in connection with any determination of the
eligibility of the Underwritten Certificates for investment by
institutional investors and the preparation of any legal investment
survey; the expenses of printing any such blue sky survey and legal
investment survey; the cost and expenses in connection with the
preparation, printing and filing of the Registration Statement (including
exhibits thereto), the Basic Prospectus, the Preliminary Prospectus
Supplement, if any, and the Prospectus Supplement, the preparation and
printing of this Agreement and the delivery to the Underwriters of such
copies of the Basic Prospectus and each Preliminary Prospectus Supplement,
if any, and Prospectus Supplement as you may reasonably request; and the
fees of the Rating Agency that are rating the Underwritten Certificates.
Except as provided above or in Section 7, the Underwriters shall be
responsible for paying all costs and expenses incurred by them in
connection with the purchase and sale of the Underwritten Certificates.
(f) The Company will enter into the Pooling and Servicing Agreement
on or prior to the Closing Date, will enforce the rights of the
Underwriters as third party beneficiaries thereunder as set forth in
Section 11.09 thereof and will not consent to any amendment of the Pooling
and Servicing Agreement that would adversely affect such rights of the
Underwriters.
(g) The Company shall, as to itself, and the Company, or pursuant to
the Pooling and Servicing Agreement the Trustee will be required to, as to
the Trust Fund, satisfy and comply with all reporting requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and the
rules and regulations thereunder. The Company will also file with the
Commission a report on Form 8-K setting forth all Computational Materials
and ABS Term Sheets provided to the Company by an Underwriter and
identified by it as such within the time period allotted for such filing
pursuant to the No-Action Letters; provided, however, that prior to such
filing of the Computational Materials and ABS Term Sheets by the Company,
each Underwriter must comply with its obligations pursuant to Section
4(b). The Company shall file any
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corrected Computational Materials described in Section 4(b)(vi) as soon as
practicable following receipt thereof.
6. Conditions to the Obligations of the Underwriters. The obligation
of each Underwriter hereunder to purchase its allocated share of the
Underwritten Certificates shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the date hereof, as of the date of the effectiveness of any amendment to the
Registration Statement filed prior to the Closing Date, as of the date the
Prospectus Supplement or any supplement thereto is filed with the Commission and
as of the Closing Date, to the accuracy of the statements of the Company made in
any certificates delivered pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions:
(a) The Registration Statement shall have become effective and no
stop order suspending the effectiveness of the Registration Statement, as
amended from time to time, shall have been issued and not withdrawn and no
proceedings for that purpose shall have been instituted or, to the
Company's knowledge, threatened; and the Prospectus Supplement shall have
been filed or transmitted for filing with the Commission in accordance
with Rule 424 under the 1933 Act;
(b) You shall have received from Sidley & Austin, counsel for the
Underwriters, a favorable opinion, dated the Closing Date, as to such
matters regarding the Underwritten Certificates as you may reasonably
request;
(c) The Company shall have delivered to you a certificate of the
Company, signed by an authorized officer of the Company and dated the
Closing Date, to the effect 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; and (ii) the Company has in all material respects
complied with all the agreements and satisfied all the conditions on its
part that are required hereby to be performed or satisfied at or prior to
the Closing Date;
(d) You shall have received with respect to the Company a good
standing certificate from the Secretary of State of the State of North
Carolina, dated not earlier than 30 days prior to the Closing Date;
(e) You shall have received from the Secretary or an assistant
secretary of the Company, in his individual capacity, a certificate, dated
the Closing Date, to the effect that: (i) each individual who, as an
officer or representative of the Company, signed this Agreement, the
Pooling and Servicing Agreement or any other document or certificate
delivered on or before the Closing Date in connection with the
transactions contemplated herein or in the Pooling and Servicing
Agreement, was at the respective times of such signing and delivery, and
is as of the Closing Date, duly elected or appointed, qualified and acting
as such officer or representative, and the signatures of such persons
appearing on such documents and certificates are their genuine signatures;
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<PAGE>
and (ii) no event (including, without limitation, any act or omission on
the part of the Company) has occurred since the date of the good standing
certificate referred to in paragraph 6(d) above which has affected the
good standing of the Company under the laws of the State of North
Carolina. Such certificate shall be accompanied by true and complete
copies (certified as such by the Secretary or an assistant secretary of
the Company) of the certificate of incorporation and by-laws of the
Company, as in effect on the Closing Date, and of the resolutions of the
Company and any required shareholder consent relating to the transactions
contemplated in this Agreement and the Pooling and Servicing Agreement;
(f) You shall have received from Willkie Farr & Gallagher, special
counsel for the Company, a favorable opinion, dated the Closing Date and
satisfactory in form and substance to you and counsel for the
Underwriters, to the effect that:
(i) The Registration Statement and any amendments thereto have
become effective under the 1933 Act; to the best knowledge of such
counsel, no stop order suspending the effectiveness of the
Registration Statement, as amended, has been issued and not
withdrawn, no proceedings for that purpose have been instituted or
threatened and not terminated; and the Registration Statement, the
Basic Prospectus, the Prospectus Supplement and each amendment or
supplement thereto, as of their respective effective or issue dates
(other than the financial statements, schedules and other financial
and statistical information contained therein as to which such
counsel need express no opinion), complied as to form in all
material respects with the applicable requirements of the 1933 Act
and the rules and regulations thereunder; and such counsel has no
reason to believe that (A) the Registration Statement (which, for
purposes of this clause, shall be deemed not to include any exhibits
filed therewith), or any amendment thereto, at the time it became
effective, contained or, as of the date of such opinion, contains
any untrue statement of a material fact or omitted or omits to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading, or that (B) the Prospectus,
as amended or supplemented, contains any untrue statement of a
material fact or omits to state a material fact necessary in order
to make the statements therein, in light of the circumstances under
which they were made, not misleading (other than the financial
statements, schedules and other financial and statistical
information contained therein as to which such counsel need express
no opinion);
(ii) To the best knowledge of such counsel, there are no
material contracts, indentures or other documents of a character
required to be described or referred to in the Registration
Statement, as amended, or the Prospectus Supplement or to be filed
as exhibits to the Registration Statement, as amended, other than
those described or referred to therein or filed or incorporated by
reference as exhibits thereto;
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<PAGE>
(iii) To the best knowledge of such counsel, there are no
actions, proceedings or investigations pending before or threatened
by any court, administrative agency or other tribunal to which the
Company is a party or of which any of its properties is the subject
(a) which if determined adversely to the Company would have a
material adverse effect on the business or financial condition of
the Company, (b) asserting the invalidity of this Agreement, the
Pooling and Servicing Agreement or the Underwritten Certificates,
(c) seeking to prevent the issuance of the Underwritten Certificates
or the consummation by the Company of any of the transactions
contemplated by the Pooling and Servicing Agreement or this
Agreement, as the case may be, or (d) which might materially and
adversely affect the performance by the Company of its obligations
under, or the validity or enforceability of, the Pooling and
Servicing Agreement, this Agreement or the Underwritten
Certificates;
(iv) Each of this Agreement and the Pooling and Servicing
Agreement has been duly authorized, executed and delivered by the
Company, and each of this Agreement and the Pooling and Servicing
Agreement constitutes a valid, legal, binding and enforceable
agreement of the Company, subject, as to enforceability, to
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally, to general principles of
equity regardless of whether enforcement is sought in a proceeding
in equity or at law and public policy considerations underlying the
securities laws, to the extent that such public policy
considerations limit the enforceability of the provisions of this
Agreement that purports to provide indemnification from securities
law liabilities;
(v) The Underwritten Certificates, when duly and validly
executed and authenticated in the manner contemplated in the Pooling
and Servicing Agreement and delivered and paid for by the
Underwriters as provided herein, will be duly and validly issued and
outstanding and entitled to the benefits of the Pooling and
Servicing Agreement;
(vi) The statements set forth in the Prospectus Supplement
under the headings "Description of the Certificates" and "Servicing
of the Mortgage Loans" and in the Basic Prospectus under the
headings "Description of the Certificates" and "Description of the
Pooling Agreements", insofar as such statements purport to summarize
certain provisions of the Underwritten Certificates and the Pooling
and Servicing Agreement, are true and correct in all material
respects;
(vii) The statements set forth in the Basic Prospectus and the
Prospectus Supplement under the headings "Material Federal Income
Tax Consequences", "ERISA Considerations" and "Legal Investment", to
the extent that they constitute matters of federal law or legal
conclusions with respect
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<PAGE>
thereto, are correct in all material respects with respect to those
consequences or aspects that are discussed;
(viii) Any Class of Underwritten Certificates will be
"mortgage related securities", as defined in Section 3(a)(41) of the
1934 Act, so long as such Certificates are rated "AAA" or "AA" (or
its equivalent) by at least one nationally recognized statistical
rating organization;
(ix) The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended, and
neither the Company nor the Trust Fund is required to be registered
under the Investment Company Act;
(x) No consent, approval, authorization or order of any State
of New York or federal court or governmental agency or body is
required for the consummation by the Company of the transactions
contemplated herein or in the Pooling and Servicing Agreement,
except (A) such as have been obtained under the 1933 Act, (B) such
as may be required under the blue sky laws of any jurisdiction in
connection with the offer and sale of the Underwritten Certificates
by the Underwriters, as to which such counsel need express no
opinion; and (C) any recordation of the assignments of the Mortgage
Loans pursuant to the Pooling and Servicing Agreement that has not
yet been completed.
(xi) Assuming compliance with all provisions of the Pooling
and Servicing Agreement, for federal income tax purposes, REMIC I,
REMIC II and REMIC III will each qualify as a real estate mortgage
investment conduit (a "REMIC") under the Internal Revenue Code of
1986 (the "Code"), the Class R-I Certificates will be the sole class
of "residual interests" in REMIC I, the Class R-II Certificates will
be the sole class of "residual interests" in REMIC II, the Class
A-1, Class A-2, Class B, Class C, Class D, Class E, Class IO, Class
F, Class G, Class H, Class J, Class K, Class L, Class M and Class N
Certificates will be the "regular interests" in REMIC III, and the
Class R-III Certificates will be the sole class of "residual
interests" in the REMIC III; and
(xii) The Certificates conform in all material respects to the
description thereof contained in the Prospectus; and the Pooling and
Servicing Agreement conforms in all material respects to the
description thereof contained in the Prospectus.
With respect to such opinion, such counsel may express its 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 this Agreement and the Pooling and Servicing Agreement; may assume the
due authorization, execution and delivery of the instruments and documents
referred to therein by the parties thereto other than the
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<PAGE>
Company; may qualify such opinion only as to the federal laws of the
United States of America, the laws of the State of New York, the laws of
the State of North Carolina and the corporation law of the State of
Delaware; and may, to the extent deemed necessary by such counsel, rely on
the opinion of counsel in the regular employ of the Company or any
affiliate of the Company or independent North Carolina counsel. Such
counsel shall also confirm that the Underwriters may rely, on and as of
the Closing Date, on any opinion or opinions of such counsel submitted to
any Rating Agency as if addressed to the Underwriters and dated the
Closing Date;
(g) You shall have received from Paul Hurdle, counsel for the
Company, a favorable opinion, dated the Closing Date and satisfactory in
form and substance to you and counsel for the Underwriters, to the effect
that:
(i) The Company is a corporation in good standing under the
laws of the State of North Carolina and has the corporate power and
authority to enter into and perform its obligations under this
Agreement and the Pooling and Servicing Agreement;
(ii) No consent, approval, authorization or order of the State
of North Carolina is required for the consummation by the Company of
the transactions contemplated herein or in the Pooling and Servicing
Agreement; and
(iii) Neither the issuance and sale of the Underwritten
Certificates, nor the execution or delivery of or performance under
this Agreement or the Pooling and Servicing Agreement, nor the
consummation of any other of the transactions contemplated herein or
therein will conflict with or result in a breach or violation of any
term or provision of, or constitute a default (or an event which
with the passing of time or notification, or both, would constitute
a default) under, the certificate of incorporation or by-laws of the
Company, or, to the knowledge of such counsel, any indenture or
other agreement or instrument to which the Company is a party or by
which it is bound, or any State of North Carolina or federal statute
or regulation applicable to the Company, or, to the knowledge of
such counsel, any order of any State of North Carolina or federal
court, regulatory body, administrative agency or governmental body
having jurisdiction over the Company;
(h) You shall have received from Deloitte & Touche LLP, certified
public accountants, a letter dated the Closing Date and satisfactory in
form and substance to you and counsel for the Underwriters, to the
following effect:
(1) they have performed certain specified procedures as a
result of which they have determined that the information of an
accounting, financial or statistical nature set forth in the
Prospectus Supplement under the captions "Summary of the Prospectus
Supplement," "Description of the Mortgage Pool" and "Yield and
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<PAGE>
Maturity Considerations" and on Annex A agrees with the data sheet
or computer tape prepared by or on behalf of the Mortgage Loan
Sellers, unless non-material deviations are otherwise noted in such
letter; and
(2) they have compared the data contained in the data sheet or
computer tape referred to in the immediately preceding clause (1) to
information contained in an agreed upon sampling of the Mortgage
Loan files and in such other sources as shall be specified by them,
and found such data and information to be in agreement in all
material respects, unless non-material deviations are otherwise
noted in such letter;
(i) You shall have received written confirmation from the Rating
Agency that the Underwritten Certificates have been assigned the rating or
ratings specified in Schedule I hereto, which rating or ratings shall not
have been withdrawn;
(j) You shall have received with respect to the Trustee a good
standing or similar certificate from the Secretary of State of the state
of its organization or, if not applicable, an appropriate federal
official, dated not earlier than 30 days prior to the Closing Date.
(k) You shall have received from the Secretary or an assistant
secretary of the Trustee, in his individual capacity, a certificate, dated
the Closing Date, to the effect that: (i) each individual who, as an
officer or representative of the Trustee, signed the Pooling and Servicing
Agreement or any other document or certificate delivered on or before the
Closing Date in connection with the transactions contemplated in the
Pooling and Servicing Agreement or this Agreement was at the respective
times of such signing and delivery, and is as of the Closing Date, duly
elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such
documents or certificates are their genuine signatures; (ii) the
information under the heading "Description of the Certificates- The
Trustee" in the Prospectus Supplement is true and correct in all material
respects; and (iii) no event (including, without limitation, any act or
omission on the part of the Trustee) has occurred since the date of the
good standing or similar certificate referred to in paragraph 6(j) above
which has affected the good standing of the Trustee under laws of the
United States;
(l) You shall have received from Cadwalader, Wickersham & Taft
counsel for the Trustee, a favorable opinion, dated the Closing Date, in
form and substance satisfactory to you and counsel for the Underwriters,
addressing such matters as you and such counsel may reasonably require for
the purpose of enabling you and such counsel to pass upon the issuance and
sale of the Underwritten Certificates as herein contemplated and related
proceedings;
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<PAGE>
(m) You shall have received with respect to the Master Servicer a
good standing or similar certificate from the Office of the Comptroller of
the Currency, dated not earlier than 30 days prior to the Closing Date;
(n) You shall have received from the Secretary or an assistant
secretary of the Master Servicer, in his individual capacity, a
certificate, dated the Closing Date, to the effect that: (i) each
individual who, as an officer or representative of the Master Servicer,
signed the Pooling and Servicing Agreement or any other document or
certificate delivered on or before the Closing Date in connection with the
transactions contemplated in the Pooling and Servicing Agreement and this
Agreement was at the respective times of such signing and delivery, and is
as of the Closing Date, duly elected or appointed, qualified and acting as
such officer or representative, and the signatures of such persons
appearing on such documents are their genuine signatures; (ii) the
information relating to the Master Servicer under the heading "Servicing
of the Mortgage Loans- The Master Servicer and Special Servicer" in the
Prospectus Supplement, is true and correct in all material respects; and
(iii) no event (including without limitation, any act or omission on the
part of the Master Servicer) has occurred since the date of the good
standing or similar certificate referred to in paragraph 6(m) above which
has affected the good standing of the Master Servicer under the laws of
the United States.
(o) You shall have received from Kilpatrick Stockton, LLP, counsel
for the Master Servicer, a favorable opinion, dated the Closing Date, in
form and substance satisfactory to you and counsel for the Underwriters,
addressing such matters as you and such counsel may reasonably require for
the purpose of enabling you and such counsel to pass upon the issuance and
sale of the Underwritten Certificates as herein contemplated and related
proceedings;
(p) You shall have received with respect to the Special Servicer a
good standing or similar certificate from the Secretary of State of the
state of its organization or, if not applicable, an appropriate federal
official, dated not earlier than 30 days prior to the Closing Date;
(q) You shall have received from the Secretary or an assistant
secretary of the Special Servicer, in his individual capacity, a
certificate, dated the Closing Date, to the effect that: (i) each
individual who, as an officer or representative of the Special Servicer,
signed the Pooling and Servicing Agreement or any other document or
certificate delivered on or before the Closing Date in connection with the
transactions contemplated in the Pooling and Servicing Agreement was at
the respective times of such signing and delivery, and is as of the
Closing Date, duly elected or appointed, qualified and acting as such
officer or representative, and the signatures of such persons appearing on
such documents are their genuine signatures; (ii) the information relating
to the Special Servicer under the heading "Servicing of the Mortgage
Loans- The Master Servicer and Special Servicer" in the Prospectus
Supplement, is true and correct in all material respects; and (iii) no
event (including without limitation, any act or
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omission on the part of the Special Servicer) has occurred since the date
of the good standing or similar certificate referred to in paragraph 6(p)
above which has affected the good standing of the Special Servicer under
the laws of the State of Maryland.
(r) You shall have received from Peabody & Brown, counsel for the
Special Servicer, a favorable opinion, dated the Closing Date, in form and
substance satisfactory to you and counsel for the Underwriters, addressing
such matters as you and such counsel may reasonably require for the
purpose of enabling you and such counsel to pass upon the issuance and
sale of the Underwritten Certificates as herein contemplated and related
proceedings;
(s) You shall have received from each Mortgage Loan Seller and its
officers all such certificates as may be required to be delivered thereby
under the related Mortgage Loan Purchase Agreement;
(t) You shall have received from Paul Hurdle, Christopher Epes and
Ted Honold counsel for First Union, LBHI and BofA respectively, written
confirmation that the Underwriters may rely, as of the date rendered, on
any opinion or opinions of such counsel required to be delivered under the
Mortgage Loan Purchase Agreements or addressed to any Rating Agency, in
each case as if such opinion were addressed to the Underwriters;
(u) You shall have received (A) from Willkie Farr & Gallagher,
special counsel for the Company, a favorable opinion, dated the Closing
Date and satisfactory in form and substance to you and counsel for the
Underwriters, with respect to the transfer of the LBHI Mortgage Loans and
the First Union Mortgage Loans from LBHI and First Union , respectively to
the Company; (B) from Mayer, Brown & Platt, counsel for BofA, a favorable
opinion, dated the Closing Date and satisfactory in form and substance to
you and counsel for the Underwriters, with respect to the transfer of the
BofA Mortgage Loans from BofA to the Company and (C) all other opinions
delivered to the Rating Agencies in connection with the transactions
contemplated hereby; and
(v) All proceedings in connection with the transactions contemplated
by this Agreement and all documents incident hereto, including, without
limitation, the Pooling and Servicing Agreement and the Mortgage Loan
Purchase Agreement, shall be satisfactory in form and substance to you and
counsel for the Underwriters, and you and such counsel shall have received
such additional information, certificates and documents as you or they may
have reasonably requested.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this 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
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to you and counsel for the Underwriters, this Agreement and all
obligations of the
-20-
<PAGE>
Underwriters hereunder may be canceled at, or at any time prior to, the Closing
Date by you. Notice of such cancellation shall be given to the Company in
writing, or by telephone or telegraph confirmed in writing.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Underwritten Certificates provided for herein is not consummated because any
condition to the obligations of the Underwriters set forth in Section 6 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 default by any of the Underwriters, the Company will
reimburse the Underwriters severally, upon demand, for all out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Underwritten Certificates.
8. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission
or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact contained in the Basic Prospectus, any
Preliminary Prospectus Supplement or the Prospectus Supplement (or
any amendment or supplement thereto) or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; provided, that the foregoing
indemnity with respect to the Basic Prospectus or any Preliminary
Prospectus Supplement shall not inure to the benefit of any
Underwriter (or to the benefit of any person controlling such
Underwriter) from whom the person asserting claims giving rise to
any such losses, claims, damages, expenses or liabilities purchased
Underwritten Certificates if such untrue statement or omission or
alleged untrue statement or omission made in any Preliminary
Prospectus Supplement is eliminated or remedied in the Prospectus
and, if required by law, a copy of the Prospectus shall not have
been furnished to such person at or prior to the written
confirmation of the sale of such Certificates to such person;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate
amount paid in
-21-
<PAGE>
settlement of any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission,
or any such alleged untrue statement or omission, if such settlement
is effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by such
Underwriter or, if more than one Underwriter is involved, by the
Representative), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission,
or any such alleged untrue statement or omission, to the extent that
any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made
in reliance upon and in conformity with written information (as specified
in Section 8(b) below) furnished to the Company by any Underwriter
expressly for use in the Registration Statement (or any amendment thereto)
or in the Basic Prospectus, any Preliminary Prospectus Supplement or the
Prospectus Supplement (or any amendment or supplement thereto).
(b) Each Underwriter, severally but not jointly, agrees to indemnify
and hold harmless the Company, its directors, each of its officers who
signed the Registration Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act against any
and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but
only with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement (or any
amendment thereto) or in the Basic Prospectus, any Preliminary Prospectus
Supplement or the Prospectus Supplement (or any amendment or supplement
thereto) in reliance upon and in conformity with written information
furnished to the Company by such Underwriter expressly for use in the
Registration Statement (or any amendment thereto) or in the Basic
Prospectus, such Preliminary Prospectus Supplement or the Prospectus
Supplement (or any amendment or supplement thereto); provided that in no
event shall either Underwriter be liable for any such loss, liability,
claim, damage or expense if such untrue statement or omission or alleged
untrue statement or omission resulted from an untrue statement or omission
in the underlying data regarding the Mortgage Loans, or the related
Mortgagors or Mortgaged Properties provided to the Underwriters by the
Mortgage Loan Sellers. It is hereby acknowledged that (i) the statements
set forth in the first sentence of the penultimate paragraph on the cover
of the Prospectus Supplement, (ii) the statements in the third, fourth and
fifth paragraphs under the caption "Method of Distribution" in the
Prospectus Supplement and (iii) the statements in any Computational
Materials and ABS Term Sheets delivered by the Underwriters to
-22-
<PAGE>
the Company for filing with the Commission pursuant to this Agreement and
the No-Action Letters, constitute the only written information furnished
to the Company by the Underwriters expressly for use in the Registration
Statement (or any amendment thereto) or in the Basic Prospectus, the
Preliminary Prospectus Supplement or the Prospectus Supplement (or any
amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but
failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability which it may have otherwise than on
account of this indemnity agreement. An indemnifying party may participate
at its own expense in the defense of any such action and, to the extent
that it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from the indemnified party,
to assume the defense thereof, with counsel satisfactory to such
indemnified party. In any such proceeding, any indemnified party shall
have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such indemnified party unless (i)
the indemnifying party and the indemnified party shall have agreed to the
retention of such counsel, or (ii) the indemnifying party shall not have
assumed the defense of such action, with counsel satisfactory to the
indemnified party, within a reasonable period following the indemnifying
party's receiving notice of such action, or (iii) the named parties to any
such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. In no event shall the
indemnifying party or parties be liable for fees and expenses of more than
one counsel (or, in the event the Company is the indemnifying party, one
counsel for each Underwriter) (in addition to any local counsel) separate
from its or their own counsel for all indemnified parties in connection
with any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances.
Unless it shall assume the defense of any proceeding, an indemnifying
party shall not be liable for any settlement of any proceeding effected
without its written consent but, if settled with such consent or if there
be a final judgment for the plaintiff, the indemnifying party shall
indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment. If an indemnifying party assumes
the defense of any proceeding, it shall be entitled to settle such
proceeding with the consent of the indemnified party or, if such
settlement provides for release of the indemnified party in connection
with all matters relating to the proceeding that have been asserted
against the indemnified party in such proceeding by the other parties to
such settlement, without the consent of the indemnified party.
9. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 8 hereof is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, the Company and the
Underwriters shall contribute to the aggregate losses,
-23-
<PAGE>
liabilities, claims, damages and expenses of the nature contemplated by said
indemnity agreement incurred by the Company and the Underwriters, as incurred,
in such proportions that each Underwriter is responsible for that portion
represented by the percentage that such Underwriter's share of the underwriting
discounts and commissions pertaining to the Underwritten Certificates bears to
the aggregate of the initial public offering prices of the Underwritten
Certificates and the Company is responsible for the balance; provided, however,
that 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; and provided, further,
that in no event shall either Underwriter be obligated to contribute more than
its share of the underwriting discounts and commissions pertaining to the
Underwritten Certificates. It is hereby acknowledged that the respective
Underwriters' obligations under this Section 9 shall be several and not joint.
For purposes of this Section, each person, if any, who controls an Underwriter
within the meaning of Section 15 of the 1933 Act shall have the same rights to
contribution as such Underwriter, and each director of the Company, each officer
of the Company who signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act shall
have the same rights to contribution as the Company.
10. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Underwritten Certificates agreed to be
purchased by such Underwriter or Underwriters hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated
severally (in the respective proportions which the portion of the Underwritten
Certificates set forth opposite their names in Schedule II hereto bears to the
aggregate amount of Underwritten Certificates set forth opposite the names of
all the remaining Underwriters) to purchase the Underwritten Certificates that
the defaulting Underwriter or Underwriters agreed but failed to purchase;
provided, however, that in the event that the amount of Underwritten
Certificates that the defaulting Underwriter or Underwriters agreed but failed
to purchase shall exceed 10% of the aggregate principal amount of Underwritten
Certificates set forth in Schedule II hereto, the remaining Underwriters shall
have the right to purchase all, but shall not be under any obligation to
purchase any, of the Underwritten Certificates, and if such nondefaulting
Underwriters do not purchase all of the Underwritten Certificates, this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Company, except as provided in Section 11 or Section 12. In the event of a
default by any Underwriter as set forth in this Section 10, the Closing Date for
the Underwritten Certificates shall be postponed for such period, not exceeding
ten business days, as you shall determine in order that the required changes in
the Registration Statement and the Prospectus Supplement or in any other
documents or arrangements may be effected. Nothing contained in this Agreement
shall relieve any defaulting Underwriter of its liability, if any, to the
Company and any nondefaulting Underwriter for damages occasioned by its default
hereunder.
11. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Company submitted pursuant hereto,
shall remain operative and
-24-
<PAGE>
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter, or by or on behalf of the Company, or by or on behalf of any
of the controlling persons and officers and directors referred to in Sections 8
and 9, and shall survive delivery of the Underwritten Certificates to the
Underwriters.
12. Termination of Agreement; Survival.
(a) The Underwriters may terminate this Agreement, by notice to the
Company, at any time at or prior to the Closing Date (i) if there has
been, since the date of this Agreement or since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, or (ii) if there has
occurred any outbreak of hostilities or escalation thereof or other
calamity or crisis the effect of which is such as to make it, in the
reasonable judgment of the Representative, impracticable to market the
Underwritten Certificates or to enforce contracts for the sale of the
Underwritten Certificates, or (iii) if trading generally on the New York
Stock Exchange has been suspended, or if a banking moratorium has been
declared by either federal or New York authorities.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party,
except as provided in Section 11 or Section 12 (c).
(c) The provisions of Section 5(e) regarding the payment of costs
and expenses and the provisions of Sections 8 and 9 hereof shall survive
the termination of this Agreement.
13. Notices. All notices and other communications hereunder shall be
in writing and shall be deemed to have been duly given if mailed or transmitted
by any standard form of telecommunication. Notices to the Underwriters shall be
directed to you at Three World Financial Center, New York, New York 10285,
attention: James C. Blakemore; and notices to the Company shall be directed to
it at First Union Commercial Mortgage Securities, Inc., One First Union Center,
Charlotte, North Carolina 28288-0166, attention of President; or, in either
case, such other address as may hereafter be furnished by either the
Representative or the Company to the other such party in writing.
14. Parties. This Agreement shall inure to the benefit of and be
binding upon each of the Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 8 and 9 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all
-25-
<PAGE>
conditions and provisions hereof are intended to be for the sole and exclusive
benefit of the Underwriters and the Company and their respective successors, and
said controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Underwritten Certificates from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
15. Applicable Law; Counterparts. This Agreement will be governed by
and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely in said State. 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.
-26-
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Company
and the several Underwriters.
Very truly yours,
FIRST UNION COMMERCIAL MORTGAGE
SECURITIES, INC.
By:
-----------------------------------------
Name: Craig Lieberman
Title: Vice President
The foregoing Agreement is hereby confirmed and accepted as of the
date first above written.
LEHMAN BROTHERS INC.
By:
-----------------------------------------
Name:
Title:
For itself and the other Underwriters named in Schedule II to the
foregoing Agreement.
-27-
<PAGE>
SCHEDULE I
Underwriting Agreement dated May 21, 1998:
As used in this Schedule I, the term "Registration Statement" refers
to registration statement No. 333-48943 filed by the Company on Form S-3 and
declared effective on May 6, 1998. The term "Basic Prospectus" refers to the
form of prospectus in the Registration Statement or such later form as most
recently filed by the Company pursuant to Rule 424(b) under the Securities Act
of 1933, as amended. The term "Prospectus Supplement" refers to the supplement
dated May 21, 1998 to the Basic Prospectus, relating to the mortgage
pass-through certificates being sold pursuant to the Underwriting Agreement (the
"Underwritten Certificates").
Mortgage Pool:
Approximately 664 commercial mortgage loans, having an aggregate
principal balance, after giving effect to payments of principal due on or before
May 1, 1998 (the "Cut-off Date"), of approximately $3,408,048,239 (the "Initial
Pool Balance"), and otherwise complying in all material respects with the
description thereof set forth in the Prospectus Supplement.
Title, Purchase Price and Description of Underwritten Certificates:
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust,
Commercial Mortgage Pass-Through Certificates, Series 1998-C2, Class A-1, Class
A-2, Class B, Class C, Class D, Class E and Class IO.
Initial
Aggregate Pass Purchase
Certificate Through Price
Designation Principal Balance Rate Rating Percentage
- ----------- ----------------- ---- ------ ----------
Class A-1 760,000,000 6.280% Aaa/AAA (1) 100.4850%
Class A-2 1,693,794,000 6.560% Aaa/AAA (1) 101.4970%
Class B 170,403,000 6.640% Aa2/AA (1) 100.9899%
Class C 170,402,000 6.730% Aa3/A (1) 99.9763%
Class D 204,483,000 6.778% Baa2/BBB(1) 96.7074%
Class E 68,161,000 6.778% Baa3/BBB-(1) 93.224%
Class IO (3) (3) Aaa/AAAr(1) N/A
- ----------
(1) By each of Moody's Investors Service, Inc. and Standard & Poor's Ratings
Services, a division of The McGraw-Hill Companies, Inc.
<PAGE>
(2) There shall be added to the purchase price for each Class of Underwritten
Certificates accrued interest, if any, at the initial Pass-Through Rate
for such Class from May 1, 1998 up to, but not including, the Closing
Date.
(3) The Class IO Certificates will not have a Certificate Principal Balance
nor will they entitle the holders thereof to receive distributions of
principal.
Credit Support and Other Terms and Conditions of the Underwritten
Certificates: As described in the Prospectus Supplement.
Closing Time, Date and Location: 10:00 a.m. (New York City time) on May 28, 1998
at the offices of Willkie Farr & Gallagher, 787 Seventh Avenue, New York, New
York 10019-6099; except that delivery of the Underwritten Certificates shall be
made through the facilities of The Depository Trust Company.
Initial Public Offering Price: The Underwritten Certificates will be offered to
the public in negotiated transactions or otherwise at varying prices to be
determined at the time of sale.
<PAGE>
SCHEDULE II
Underwriting Agreement dated May 21, 1998
50/50 Split
Approximate Aggregate
Principal or Notional
Amount of Certificates to
Underwriters Class be Purchased
- ------------ ----- ------------
First Union Capital Markets, a division of Wheat First Securities, Inc.
Class A-1 $ 380,000,000
Class A-2 $ 846,897,000
Class B $ 85,201,500
Class C $ 85,201,000
Class D $ 102,241,500
Class E $ 34,080,500
Class IO $ 1,704,024,195
Lehman Brothers Inc.
Class A-1 $ 380,000,000
Class A-2 $ 846,897,000
Class B $ 85,201,500
Class C $ 85,201,000
Class D $ 102,241,500
Class E $ 34,080,500
Class IO $ 1,704,024,195
<PAGE>
Exhibit 4.1
EXECUTION COPY
================================================================================
FIRST UNION COMMERCIAL MORTGAGE SECURITIES, INC.
Depositor
and
FIRST UNION NATIONAL BANK
Master Servicer
and
CRIIMI MAE SERVICES LIMITED PARTNERSHIP
Special Servicer
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of May 1, 1998
--------------------------------
$3,408,048,239
Commercial Mortgage Pass-Through Certificates
Series 1998-C2
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I DEFINITIONS
SECTION 1.01. Defined Terms..................................................3
30/360 Basis.............................................................3
Accrued Certificate Interest.............................................3
Accrued Component Interest...............................................3
Acquisition Date.........................................................3
Actual/360 Basis.........................................................3
Actual-360 Mortgage Loan.................................................3
Additional Interest......................................................3
Additional Interest Rate.................................................4
Additional Servicing Fee.................................................4
Additional Servicing Fee Rate............................................4
Additional Trust Fund Expense............................................4
Additional Yield Amount..................................................4
Advance..................................................................5
Adverse REMIC Event......................................................5
Affiliate................................................................5
Agreement................................................................5
Anticipated Repayment Date...............................................5
Appraisal................................................................5
Appraisal Reduction Amount...............................................5
Appraised Value..........................................................6
ARD Loan.................................................................6
Assignment of Leases.....................................................6
Assumed Scheduled Payment................................................6
Authenticating Agent.....................................................6
Available Distribution Amount............................................6
Balloon Mortgage Loan....................................................7
Balloon Payment..........................................................7
Bankruptcy Code..........................................................7
Book-Entry Certificate...................................................7
Breach...................................................................7
Business Day.............................................................7
CERCLA...................................................................7
Certificate..............................................................8
Certificate Account......................................................8
Certificate Factor.......................................................8
Certificate Notional Amount..............................................8
Certificate Owner........................................................8
i
<PAGE>
Certificate Principal Balance............................................8
Certificate Register.....................................................8
Certificate Registrar....................................................8
Certificateholder........................................................8
Class....................................................................9
Class A Certificates.....................................................9
Class A-1 Certificate....................................................9
Class A-2 Certificate....................................................9
Class B Certificate......................................................9
Class C Certificate......................................................9
Class D Certificate......................................................9
Class E Certificate.....................................................10
Class F Certificate.....................................................10
Class G Certificate.....................................................10
Class H Certificate.....................................................10
Class IO Certificate....................................................10
Class J Certificate.....................................................10
Class K Certificate.....................................................10
Class L Certificate.....................................................10
Class M Certificate.....................................................10
Class N Certificate.....................................................10
Class Notional Amount...................................................10
Class Principal Balance.................................................11
Class R-I Certificate...................................................11
Class R-II Certificate..................................................11
Class R-III Certificate.................................................11
Closing Date............................................................11
Code....................................................................11
Collection Period.......................................................11
Comparative Financial Status Report.....................................11
Component...............................................................12
Component IO-A-1........................................................12
Component IO-A-2........................................................12
Component IO-B..........................................................12
Component IO-C..........................................................12
Component IO-D..........................................................12
Component IO-E..........................................................12
Component IO-F..........................................................12
Component IO-G..........................................................12
Component IO-H..........................................................13
Component IO-J..........................................................13
Component IO-K..........................................................13
Component IO-L..........................................................13
Component IO-M..........................................................13
Component IO-N..........................................................13
ii
<PAGE>
Component Notional Amount...............................................13
Controlling Class.......................................................13
Controlling Class Representative........................................13
Corporate Trust Office..................................................13
Corrected Mortgage Loan.................................................14
Corresponding Component":...............................................14
Corresponding REMIC Regular Interest":..................................14
Credit Lease............................................................14
Credit Lease Loan.......................................................14
CSSA Loan File Report...................................................14
CSSA Property File Report...............................................14
Custodian...............................................................14
Cut-off Date............................................................14
Cut-off Date Balance....................................................14
Debt Service Coverage Ratio.............................................14
Deemed Due Date Mortgage Loan...........................................15
Defaulted Mortgage Loan.................................................15
Defeasance Collateral...................................................15
Defeasance Loan.........................................................15
Definitive Certificate..................................................15
Delinquent Loan Status Report...........................................15
Depositor...............................................................15
Depository..............................................................15
Depository Participant..................................................16
Determination Date......................................................16
Directly Operate........................................................16
Discount Rate...........................................................16
Disqualified Organization...............................................16
Distributable Certificate Interest......................................17
Distribution Account....................................................17
Distribution Date.......................................................17
Distribution Date Statement.............................................17
Document Defect.........................................................17
Due Date................................................................17
Eligible Account........................................................17
Environmental Assessment................................................18
ERISA...................................................................18
Escrow Payment..........................................................18
Event of Default........................................................18
Exchange Act............................................................18
Excluded Class Certificates.............................................18
FDIC....................................................................18
FHLMC...................................................................18
Final Recovery Determination............................................18
First Union Capital.....................................................19
iii
<PAGE>
FNMA....................................................................19
Grantor Trust...........................................................19
Grantor Trust Assets....................................................19
Grantor Trust Provisions................................................19
Ground Lease............................................................19
Guaranty................................................................19
Hazardous Materials.....................................................19
Historical Loan Modification Report.....................................19
Historical Loss Estimate Report.........................................20
Holder..................................................................20
HUD-Approved Servicer...................................................20
Impound Reserve.........................................................20
Independent.............................................................20
Independent Appraiser...................................................20
Independent Contractor..................................................20
Insurance Policy........................................................21
Insurance Proceeds......................................................21
Interest Reserve Account................................................21
Interest Reserve Amount.................................................21
Interest Reserve Loan...................................................21
Interested Person.......................................................21
Investment Account......................................................22
Issue Price.............................................................22
Late Collections........................................................22
Lease Enhancement Policy................................................22
Lease Enhancement Policy Issuer.........................................22
Lease Enhancement Policy Termination Event..............................22
Legal Final Distribution Date...........................................22
Liquidation Event.......................................................22
Liquidation Proceeds....................................................23
Loan Payoff Notification Report.........................................23
Loan-to-Value Ratio.....................................................23
Lockout Period..........................................................23
Majority Subordinate Certificateholder..................................23
Master Servicer.........................................................24
Master Servicing Fee....................................................24
Master Servicing Fee Rate...............................................24
Monthly Payment.........................................................24
Moody's.................................................................24
Mortgage................................................................24
Mortgage File...........................................................24
Mortgage Loan...........................................................26
Mortgage Loan Purchase Agreements.......................................26
Mortgage Loan Schedule..................................................26
Mortgage Loan Seller....................................................27
iv
<PAGE>
Mortgage Note...........................................................27
Mortgage Pool...........................................................27
Mortgage Rate...........................................................28
Mortgaged Property......................................................28
Mortgagor...............................................................28
Net Aggregate Prepayment Interest Shortfall.............................28
Net Investment Earnings.................................................28
Net Investment Loss.....................................................28
Net Mortgage Rate.......................................................28
Net Operating Income or NOI.............................................29
New Lease...............................................................29
NOI Adjustment Worksheet................................................29
Nonrecoverable Advance..................................................29
Nonrecoverable P&I Advance..............................................29
Nonrecoverable Servicing Advance........................................29
Non-Registered Certificate..............................................29
Non-United States Person................................................29
Officers' Certificate...................................................29
Operating Statement Analysis............................................29
Opinion of Counsel......................................................30
Original Class Notional Amount..........................................30
Original Class Principal Balance........................................30
OTS.....................................................................30
Ownership Interest......................................................30
Pass-Through Rate.......................................................30
Paying Agent............................................................31
Penalty Interest........................................................31
Percentage Interest.....................................................31
Permitted Investments...................................................31
Permitted Transferee....................................................33
Person..................................................................33
P&I Advance.............................................................33
P&I Advance Date........................................................33
Plurality Residual Certificateholder....................................33
Prepayment Assumption...................................................33
Prepayment Interest Excess..............................................33
Prepayment Interest Shortfall...........................................34
Prepayment Premium......................................................34
Prime Rate..............................................................34
Principal Distribution Amount...........................................34
Principal Prepayment....................................................36
Principal Recovery Fee..................................................36
Privileged Person.......................................................36
Prospectus..............................................................36
Prospectus Supplement...................................................36
v
<PAGE>
Purchase Price..........................................................36
Qualified Insurer.......................................................36
Rated Final Distribution Date...........................................36
Rating Agency...........................................................36
Realized Loss...........................................................37
Record Date.............................................................37
Registered Certificate..................................................37
Regular Certificate.....................................................37
Reimbursement Rate......................................................37
REMIC...................................................................37
REMIC Administrator.....................................................38
REMIC Provisions........................................................38
REMIC I.................................................................38
REMIC I Regular Interest................................................38
REMIC I Remittance Rate.................................................38
REMIC II................................................................39
REMIC II Regular Interest...............................................39
REMIC II Remittance Rate................................................39
REMIC III...............................................................39
REMIC III Certificate...................................................39
Rents from Real Property................................................39
REO Account.............................................................39
REO Acquisition.........................................................40
REO Disposition.........................................................40
REO Extension...........................................................40
REO Loan................................................................40
REO Property............................................................41
REO Revenues............................................................41
REO Status Report.......................................................41
REO Tax.................................................................41
Request for Release.....................................................41
Required Appraisal......................................................41
Required Appraisal Mortgage Loan........................................41
Required Appraisal Value................................................41
Reserve Account.........................................................42
Reserve Funds...........................................................42
Residual Certificate....................................................42
Responsible Officer.....................................................42
Restricted Servicer Reports.............................................42
Scheduled Payment.......................................................42
Securities Act..........................................................42
Senior Certificate......................................................42
Sequential Pay Certificates.............................................42
Servicing Account.......................................................42
Servicing Advances......................................................43
vi
<PAGE>
Servicing Fees..........................................................43
Servicing File..........................................................43
Servicing Officer.......................................................43
Servicing Standard......................................................43
Servicing Transfer Event................................................44
Single Certificate......................................................44
Spa Business Center Loan................................................44
Special Servicer........................................................44
Special Servicing Fee...................................................44
Special Servicing Fee Rate..............................................44
Specially Serviced Mortgage Loan........................................44
Standard & Poor's.......................................................46
Startup Day.............................................................46
State and Local Taxes...................................................46
Stated Maturity Date....................................................47
Stated Principal Balance................................................47
Subordinated Certificate................................................47
Sub-Servicer............................................................47
Sub-Servicing Agreement.................................................47
Tax Matters Person......................................................47
Tax Returns.............................................................47
Tenant..................................................................48
Transfer................................................................48
Transferee..............................................................48
Transferor..............................................................48
Trust Fund..............................................................48
Trustee.................................................................48
Trustee Fee.............................................................48
Trustee Fee Rate........................................................48
Trustee Liability.......................................................48
UCC.....................................................................48
UCC Financing Statement.................................................48
Uncertificated Accrued Interest.........................................48
Uncertificated Distributable Interest...................................49
Uncertificated Principal Balance........................................49
Underwriter.............................................................50
United States Person....................................................50
Unrestricted Servicer Reports...........................................50
USAP....................................................................50
Voting Rights...........................................................50
Watch List..............................................................50
Weighted Average REMIC I Remittance Rate................................51
Yield Maintenance Charge................................................51
vii
<PAGE>
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans..................................52
SECTION 2.02. Acceptance of the Trust Fund by Trustee.......................53
SECTION 2.03. Mortgage Loan Seller's Repurchase of Mortgage Loans for
Document Defects and Breaches of Representations and
Warranties...................................................54
SECTION 2.04. Representations and Warranties of Depositor...................55
SECTION 2.05. Execution, Authentication and Delivery of Class R-I
Certificates; Creation of REMIC I Regular Interests..........57
SECTION 2.06. Conveyance of REMIC I Regular Interests; Acceptance of
REMIC II by Trustee..........................................57
SECTION 2.07. Execution, Authentication and Delivery of Class R-II
Certificates.................................................58
SECTION 2.08. Conveyance of REMIC II Regular Interests; Acceptance of
REMIC III by Trustee.........................................58
SECTION 2.09. Execution, Authentication and Delivery of REMIC III
Certificates.................................................58
ARTICLE III ADMINISTRATION AND SERVICING OF THE TRUST FUND
SECTION 3.01. Administration of the Mortgage Loans..........................59
SECTION 3.02. Collection of Mortgage Loan Payments..........................60
SECTION 3.03. Collection of Taxes, Assessments and Similar Items;
Servicing Accounts; Reserve Accounts.........................62
SECTION 3.04. Certificate Account, Interest Reserve Account and
Distribution Account.........................................64
SECTION 3.05. Permitted Withdrawals From the Certificate Account,
Interest Reserve Account and the Distribution Account........67
SECTION 3.06. Investment of Funds in the Servicing Accounts, the
Reserve Accounts, the Certificate Account, the
Distribution Account and the REO Account.....................71
SECTION 3.07. Maintenance of Insurance Policies; Errors and Omissions
and Fidelity Coverage........................................73
SECTION 3.08. Enforcement of Alienation Clauses.............................76
SECTION 3.09. Realization Upon Defaulted Mortgage Loans; Required
Appraisals...................................................77
SECTION 3.10. Trustee and Custodian to Cooperate; Release of Mortgage
Files........................................................80
SECTION 3.11. Servicing Compensation........................................81
SECTION 3.12. Property Inspections; Collection of Financial Statements;
Delivery of Certain Reports..................................84
SECTION 3.13. Annual Statement as to Compliance.............................87
SECTION 3.14. Reports by Independent Public Accountants.....................87
SECTION 3.15. Access to Certain Information.................................88
SECTION 3.16. Title to REO Property; REO Account............................90
SECTION 3.17. Management of REO Property....................................92
SECTION 3.18. Sale of Mortgage Loans and REO Properties.....................95
viii
<PAGE>
SECTION 3.19. Additional Obligations of Master Servicer and Special
Servicer.....................................................98
SECTION 3.20. Modifications, Waivers, Amendments and Consents...............98
SECTION 3.21. Transfer of Servicing Between Master Servicer and Special
Servicer; Record Keeping....................................102
SECTION 3.22. Sub-Servicing Agreements.....................................104
SECTION 3.23. Representations and Warranties of Master Servicer and
Special Servicer............................................106
SECTION 3.24. Sub-Servicing Agreement Representation and Warranty..........110
ARTICLE IV PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions................................................111
SECTION 4.02. Statements to Certificateholders; CSSA Loan File Report......122
SECTION 4.03. P&I Advances.................................................127
SECTION 4.04. Allocation of Realized Losses and Additional Trust Fund
Expenses....................................................130
SECTION 4.05. Calculations.................................................132
SECTION 4.06. Use of Agents................................................132
ARTICLE V THE CERTIFICATES
SECTION 5.01. The Certificates.............................................133
SECTION 5.02. Registration of Transfer and Exchange of Certificates........133
SECTION 5.03. Book-Entry Certificates......................................139
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates............141
SECTION 5.05. Persons Deemed Owners........................................141
ARTICLE VI THE DEPOSITOR, THE MASTER SERVICER, THE SPECIAL SERVICER AND THE
CONTROLLING CLASS REPRESENTATIVE
SECTION 6.01. Liability of Depositor, Master Servicer and Special
Servicer....................................................142
SECTION 6.02. Merger, Consolidation or Conversion of Depositor or
Master Servicer or Special Servicer.........................142
SECTION 6.03. Limitation on Liability of Depositor, Master Servicer and
Special Servicer............................................143
SECTION 6.04. Resignation of Master Servicer and the Special Servicer......144
SECTION 6.05. Rights of Depositor and Trustee in Respect of Master
Servicer and the Special Servicer...........................144
SECTION 6.06. Depositor, Master Servicer and Special Servicer to
Cooperate with Trustee......................................145
SECTION 6.07. Depositor, Special Servicer and Trustee to Cooperate with
Master Servicer.............................................145
SECTION 6.08. Depositor, Master Servicer and Trustee to Cooperate with
Special Servicer............................................145
SECTION 6.09. Designation of Special Servicer by the Controlling Class.....145
SECTION 6.10. Master Servicer or Special Servicer as Owner of a
Certificate.................................................146
ix
<PAGE>
ARTICLE VII DEFAULT
SECTION 7.01. Events of Default............................................149
SECTION 7.02. Trustee to Act; Appointment of Successor.....................153
SECTION 7.03. Notification to Certificateholders...........................154
SECTION 7.04. Waiver of Events of Default..................................154
SECTION 7.05. Additional Remedies of Trustee Upon Event of Default.........155
ARTICLE VIII CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee............................................156
SECTION 8.02. Certain Matters Affecting Trustee............................157
SECTION 8.03. Trustee Not Liable for Validity or Sufficiency of
Certificates or Mortgage Loans..............................159
SECTION 8.04. Trustee May Own Certificates.................................159
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of Trustee.....159
SECTION 8.06. Eligibility Requirements for Trustee.........................160
SECTION 8.07. Resignation and Removal of Trustee...........................161
SECTION 8.08. Successor Trustee............................................162
SECTION 8.09. Merger or Consolidation of Trustee...........................162
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee................163
SECTION 8.11. Appointment of Custodians....................................164
SECTION 8.12. Appointment of Authenticating Agents.........................165
SECTION 8.13. Appointment of Paying Agent..................................166
SECTION 8.14. Appointment of REMIC Administrators..........................166
SECTION 8.15. Access to Certain Information................................167
SECTION 8.16. Representations, Warranties and Covenants of Trustee.........168
SECTION 8.17. Reports to the Securities and Exchange Commission;
Available Information.......................................169
ARTICLE IX TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All
Mortgage Loans..............................................170
SECTION 9.02. Additional Termination Requirements..........................177
ARTICLE X ADDITIONAL REMIC PROVISIONS
SECTION 10.01. REMIC Administration........................................178
SECTION 10.02. Grantor Trust Administration................................182
x
<PAGE>
ARTICLE XI MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment...................................................184
SECTION 11.02. Recordation of Agreement; Counterparts......................186
SECTION 11.03. Limitation on Rights of Certificateholders..................186
SECTION 11.04. Governing Law...............................................187
SECTION 11.05. Notices.....................................................187
SECTION 11.06. Severability of Provisions..................................188
SECTION 11.07. Grant of a Security Interest................................188
SECTION 11.08. Streit Act..................................................188
SECTION 11.09. Successors and Assigns; Beneficiaries.......................189
SECTION 11.10. Article and Section Headings................................189
SECTION 11.11. Notices to Rating Agencies..................................189
SECTION 11.12. Complete Agreement..........................................191
xi
<PAGE>
EXHIBITS
Exhibit Description Exhibit No. Section Reference
- ------------------- ----------- -----------------
Form of Class A-1 Certificate A-1 Section 1.01 Definition
of "Class A-1
Certificate"
Form of Class A-2 Certificate A-2 Section 1.01 Definition
of "Class A-2
Certificate"
[Reserved] A-3
Form of Class IO Certificate A-4 Section 1.01 Definition
of "Class IO Certificate"
Form of Class B Certificate A-5 Section 1.01 Definition
of "Class B Certificate"
Form of Class C Certificate A-6 Section 1.01 Definition
of "Class C Certificate"
Form of Class D Certificate A-7 Section 1.01 Definition
of "Class D Certificate"
Form of Class E Certificate A-8 Section 1.01 Definition
of "Class E Certificate"
Form of Class F Certificate A-9 Section 1.01 Definition
of "Class F Certificate"
Form of Class G Certificate A-10 Section 1.01 Definition
of "Class G Certificate"
Form of Class H Certificate A-11 Section 1.01 Definition
of "Class H Certificate"
Form of Class J Certificate A-12 Section 1.01 Definition
of "Class J Certificate"
Form of Class K Certificate A-13 Section 1.01 Definition
of "Class K Certificate"
Form of Class L Certificate A-14 Section 1.01 Definition
of "Class L Certificate"
xii
<PAGE>
Exhibit Description Exhibit No. Section Reference
- ------------------- ----------- -----------------
Form of Class M Certificate A-15 Section 1.01 Definition
of "Class M Certificate"
Form of Class N Certificate A-16 Section 1.01 Definition
of "Class N Certificate"
Form of Class R-I Certificate A-17 Section 1.01 Definition
of "Class R-I
Certificate"
Form of Class R-II Certificate A-18 Section 1.01 Definition
of "Class R-II
Certificate"
Form of Class R-III A-19 Section 1.01 Definition
Certificate of "Class R-III
Certificate"
Mortgage Loan Schedule B Section 1.01 Definition
of "Mortgage Loan
Schedule"
Form of Schedule C Section 2.02(a)
of Exceptions to Mortgage
File Delivery
Form of Master Servicer D-1 Section 1.01 Definition
Request for Release of "Request for Release";
Section 2.03(b); Section
3.10(a); and Section
3.10(b)
Form of Special Servicer D-2 Section 1.01 Definition
Request for Release of "Request for Release";
Section 3.10(b)
Calculation of NOI/Debt E Section 1.01 Definition
Service Coverage Ratios of "Net Operating
Income"; Section 3.12(b)
[Reserved] F
Form of Certificate from G-1 Section 5.02(b)
Holder (Transferor) of a
Certificate to the
Certificate Registrar
Form of Certificate from G-2 Section 5.02(b)
Proposed Transferee of a
Certificate to Certificate
Registrar
xiii
<PAGE>
Exhibit Description Exhibit No. Section Reference
- ------------------- ----------- -----------------
Form of Certificate from G-3 Section 5.02(b)
Proposed Transferee of a
Certificate to Certificate
Registrar for non-QIBs
Form of Certificate (to H Section 5.02(c)
Certificate Registrar) by
Prospective Transferor that
it is not a Plan or certain
other Persons
Form of Transfer Affidavit I-1 Section 5.02(d)(i)(B)
and Agreement regarding Class
R-I Certificates
Form of Transferor I-2 Section 5.02(d)(i)(D)
Certificate regarding Class
R-I, R-II and R-III
Certificates
Form of Notice and J-1 Section 6.09
Acknowledgment
Form of Acknowledgment of J-2 Section 6.09
Proposed Special Servicer
Privileged Person Certificate K Section 3.15(b)
Form of Schedule of Holders L Section 4.02(a)
of each Class of Regular
Certificates
Form of CSSA Property File M Section 3.12(c)
Report
Form of Comparative Financial N Section 3.12(b) and
Status Report 3.12(c)
Form of REO Status Report O Section 3.12(b) and
3.12(c)
Form of Watch List P Section 3.12(b) and
3.12(c)
Form of Delinquent Loan Q Section 3.12(b) and
Status Report 3.12(c)
Form of Historical Loan R Section 3.12(b) and
Modification Report 3.12(c)
xiv
<PAGE>
Exhibit Description Exhibit No. Section Reference
- ------------------- ----------- -----------------
Form of Historical Loss S Section 3.12(b) and
Estimate Report 3.12(c)
Form of NOI Adjustment T Section 3.12(b) and
Worksheet 3.12(c)
Form of Operating Statement U Section 3.12(b) and
Analysis 3.12(c)
Form of Loan Payoff V Section 3.12(b) and
Notification Report 3.12(c)
Form of CSSA Loan File Report W Section 4.02(b)
Form of Certificateholder X-1 Section 3.15
Confirmation Certificate
Form of Prospective Purchaser X-2 Section 3.15
Certificate
xv
<PAGE>
This Pooling and Servicing Agreement (this "Agreement") is dated and
effective as of May 1, 1998, among FIRST UNION COMMERCIAL MORTGAGE SECURITIES,
INC., as Depositor, FIRST UNION NATIONAL BANK, as Master Servicer, CRIIMI MAE
SERVICES LIMITED PARTNERSHIP, as Special Servicer, and NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as Trustee.
PRELIMINARY STATEMENT:
The Depositor intends to sell mortgage pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes
(each, a "Class"), which in the aggregate will evidence the entire beneficial
ownership interest in a trust fund (the "Trust Fund") to be created hereunder.
As provided herein, the Trustee will elect to treat the segregated
pool of assets consisting of the Mortgage Loans (exclusive of that portion of
the interest payments thereon that constitute Additional Interest) and certain
other related assets subject to this Agreement as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC I."
The Class R-I Certificates will represent the sole class of "residual interests"
in REMIC I for purposes of the REMIC Provisions under federal income tax law.
Except as provided below, each REMIC I Regular Interest will relate to a
specific Mortgage Loan. Each such REMIC I Regular Interest will have: (i)
subject to adjustment as provided herein, a remittance rate equal to the
unmodified Net Mortgage Rate as of the Closing Date of the Mortgage Loan to
which such REMIC I Regular Interest relates; and (ii) an initial Uncertificated
Principal Balance equal to the Cut-off Date Balance of the Mortgage Loan to
which such REMIC I Regular Interest relates. None of the REMIC I Regular
Interests will be certificated.
As provided herein, the Trustee will elect to treat the segregated
pool of assets consisting of the REMIC I Regular Interests as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC II." The Class R-II Certificates will represent the sole
class of "residual interests" in REMIC II for purposes of the REMIC Provisions
under federal income tax law. The REMIC II Remittance Rate with respect to each
REMIC II Regular Interest will be calculated in accordance with the definition
of "REMIC II Remittance Rate". The initial Uncertificated Principal Balance of
each REMIC II Regular Interest will equal the Original Class Principal Balance
of the corresponding Class of the REMIC III Certificates described below. None
of the REMIC II Regular Interests will be certificated.
As provided herein, the Trustee will elect to treat the segregated
pool of assets consisting of the REMIC II Regular Interests as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC III". The Class R-III Certificates will evidence the sole
class of "residual interests" in REMIC III for purposes of the REMIC Provisions
under federal income tax law. For federal income tax purposes, each Class of the
Regular Certificates (other than the Class IO Certificates) and each of the
<PAGE>
2
Components of the Class IO Certificates will be designated as a separate
"regular interest" in REMIC III for purposes of the REMIC Provisions under
federal income tax law.
The following table sets forth the Class designation, the
corresponding REMIC II Regular Interest (the "Corresponding REMIC II Regular
Interest"), the corresponding Component of the Class IO Certificates (the
"Corresponding Component") and the Original Class Principal Balance for each
Class of the Regular Certificates (other than the Class IO Certificates).
Corresponding
Corresponding Component of
Class REMIC II Class IO Original Class
Designation Regular Interest Certificates Principal
(1) (1) Balance
----------- ---------------- ------------ ---------
Class A-1 M IO-A-1 $ 760,000,000
Class A-2 N IO-A-2 1,693,794,000
Class B O IO-B 170,403,000
Class C P IO-C 170,402,000
Class D Q IO-D 204,483,000
Class E R IO-E 68,161,000
Class F S IO-F 51,121,000
Class G T IO-G 102,241,582
Class H U IO-H 17,040,241
Class J V IO-J 34,080,482
Class K W IO-K 51,120,723
Class L X IO-L 34,080,482
Class M Y IO-M 17,040,241
Class N Z IO-N 34,080,488
(1) The REMIC II Regular Interest and the Component of the Class IO Certificates
that correspond to any particular Class of Sequential Pay Certificates also
correspond to each other and, accordingly, constitute the "Corresponding REMIC
II Regular Interest" and the "Corresponding Component", respectively, with
respect to each other.
As provided herein, the Trustee shall take all actions necessary to
ensure that the portion of the Trust Fund consisting of the Grantor Trust Assets
maintains its status as a "grantor trust" under federal income tax law and not
be treated as part of REMIC I, REMIC II or REMIC III.
In consideration of the mutual agreements herein contained, the
Depositor, the Master Servicer, the Special Servicer and the Trustee agree as
follows:
<PAGE>
3
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms.
Whenever used in this Agreement, including in the Preliminary
Statement, the following words and phrases, unless the context otherwise
requires, shall have the meanings specified in this Article.
"30/360 Basis": The accrual of interest calculated on the basis of a
360-day year consisting of twelve 30-day months.
"Accrued Certificate Interest": With respect to any Class of Regular
Certificates (other than the Class IO Certificates) for any Distribution Date,
one month's interest at the Pass-Through Rate applicable to such Class of
Certificates for such Distribution Date, accrued on the related Class Principal
Balance outstanding immediately prior to such Distribution Date; and, with
respect to the Class IO Certificates for any Distribution Date, the sum of the
Accrued Component Interest for all of its Components for such Distribution Date.
Accrued Certificate Interest shall be calculated on a 30/360 Basis and, with
respect to any Class of Regular Certificates for any Distribution Date, shall be
deemed to accrue during the calendar month preceding the month in which such
Distribution Date occurs.
"Accrued Component Interest": With respect to each Component of the
Class IO Certificates for any Distribution Date, one month's interest at the
Pass-Through Rate applicable to such Component for such Distribution Date,
accrued on the Component Notional Amount of such Component outstanding
immediately prior to such Distribution Date. Accrued Component Interest shall be
calculated on a 30/360 Basis and, with respect to any Component of the Class IO
Certificates for any Distribution Date, shall be deemed to accrue during the
calendar month preceding the month in which such Distribution Date occurs.
"Acquisition Date": With respect to any REO Property, the first day
on which such REO Property is considered to be acquired by the Trust Fund within
the meaning of Treasury Regulations Section 1.856-6(b)(1), which is the first
day on which the Trust Fund is treated as the owner of such REO Property for
federal income tax purposes.
"Actual/360 Basis": The accrual of interest calculated on the basis
of the actual number of days elapsed during any calendar month in a year assumed
to consist of 360 days.
"Actual/360 Mortgage Loan": Each Mortgage Loan that accrues interest
on an Actual/360 Basis and that is identified as an Actual/360 Mortgage Loan on
the Mortgage Loan Schedule.
"Additional Interest": With respect to any ARD Loan after its
Anticipated Repayment Date, all interest accrued on the principal balance of
such ARD Loan at the Additional
<PAGE>
4
Interest Rate (the payment of which interest shall, under the terms of such
Mortgage Loan, be deferred until the entire outstanding principal balance of
such ARD Loan has been paid), together with all interest, if any, accrued at the
related Mortgage Rate on such deferred interest. For purposes of this Agreement,
Additional Interest on an ARD Loan or any successor REO Loan shall be deemed not
to constitute principal or any portion thereof and shall not be added to the
unpaid principal balance or Stated Principal Balance of such ARD Loan or
successor REO Loan, notwithstanding that the terms of the related loan documents
so permit. To the extent that any Additional Interest is not paid on a current
basis, it shall be deemed to be deferred interest.
"Additional Interest Rate": With respect to any ARD Loan after its
Anticipated Repayment Date, the incremental increase in the per annum rate at
which such Mortgage Loan accrues interest resulting from the passage of such
Anticipated Repayment Date.
"Additional Servicing Fee ": With respect to each Mortgage Loan and
REO Loan, the fee designated as such and payable to the Special Servicer
pursuant to Section 3.11(c).
"Additional Servicing Fee Rate": With respect to any Distribution
Date, 0.005% per annum.
"Additional Trust Fund Expense": Any Special Servicing Fees,
Principal Recovery Fees and, in accordance with Sections 3.03(d) and 4.03(d),
interest payable to the Master Servicer, the Special Servicer and the Trustee on
Advances, as well as (without duplication) any of the expenses of the Trust Fund
that may be withdrawn (x) pursuant to any of clauses (viii), (ix), (xi), (xii)
and (xiii) of Section 3.05(a) out of general collections on the Mortgage Loans
and any REO Properties on deposit in the Certificate Account or (y) pursuant to
clause (ii) or any of clauses (iv) through (vi) of Section 3.05(b) out of
general collections on the Mortgage Loans and any REO Properties on deposit in
the Distribution Account; provided that for purposes of the allocations
contemplated by Section 4.04 no such expense shall be deemed to have been
incurred by the Trust Fund until such time as the payment thereof is actually
made from the Certificate Account or the Distribution Account, as the case may
be.
"Additional Yield Amount": With respect to any Distribution Date and
each Class of Sequential Pay Certificates (other than any Excluded Class
thereof) entitled to distributions of principal pursuant to Section 4.01(a) on
such Distribution Date, provided that a Prepayment Premium or Yield Maintenance
Charge was actually collected on a Mortgage Loan or an REO Loan during the
related Collection Period, the product of (a) such Prepayment Premium or Yield
Maintenance Charge, as the case may be, multiplied by (b) a fraction, which in
no event will be greater than one, the numerator of which is equal to the
positive excess, if any, of (i) the Pass-Through Rate for such Class of
Sequential Pay Certificates over (ii) the related Discount Rate, and the
denominator of which is equal to the positive excess, if any, of (i) the
Mortgage Rate for such Mortgage Loan or REO Loan, as the case may be, over (ii)
the related Discount Rate, multiplied by (c) a fraction, the numerator of which
is equal to the amount of principal distributable on such Class of Sequential
Pay
<PAGE>
5
Certificates on such Distribution Date pursuant to Section 4.01(a), and the
denominator of which is equal to the Principal Distribution Amount for such
Distribution Date.
"Advance": Any P&I Advance or Servicing Advance.
"Adverse REMIC Event": As defined in Section 10.01(i).
"Affiliate": With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all amendments
hereof and supplements hereto.
"Anticipated Repayment Date": For each ARD Loan, the date specified
in the related Mortgage Note after which the Mortgage Rate for such ARD Loan
will increase as specified in the related Mortgage Note.
"Appraisal": With respect to any Mortgage Loan, an appraisal of the
related Mortgaged Property conducted in accordance with the standards of the
American Appraisal Institute by an Independent Appraiser, which Independent
Appraiser shall be advised to take into account the factors specified in Section
3.18(e), any available environmental, engineering or other third-party reports,
and other factors that a prudent real estate appraiser would consider.
"Appraisal Reduction Amount": The excess, if any, of (a) the sum of,
as of the Determination Date immediately succeeding the date on which a Required
Appraisal is obtained (without duplication), (i) the Stated Principal Balance of
the subject Required Appraisal Mortgage Loan, (ii) to the extent not previously
advanced by or on behalf of the Master Servicer or the Trustee, all unpaid
interest on the Required Appraisal Mortgage Loan through the most recent Due
Date prior to such Determination Date at a per annum rate equal to the related
Net Mortgage Rate (exclusive of any portion thereof that constitutes Additional
Interest), (iii) all accrued but unpaid Servicing Fees and Additional Trust Fund
Expenses in respect of such Required Appraisal Mortgage Loan, (iv) all related
unreimbursed Advances (plus accrued interest thereon) made by or on behalf of
the Master Servicer, the Special Servicer or the Trustee with respect to such
Required Appraisal Mortgage Loan and (v) all currently due and unpaid real
estate taxes and unfunded improvement reserves (in each case net of any amounts
escrowed therefor) and assessments, insurance premiums, and, if applicable,
ground rents in respect of the related Mortgaged Property over (b) the Required
Appraisal Value.
<PAGE>
6
"Appraised Value": With respect to each Mortgaged Property, the
appraised value thereof based upon the most recent appraisal or update thereof
that is contained in the related Servicing File.
"ARD Loan": Any Mortgage Loan that provides that if the unamortized
principal balance thereof is not repaid on its Anticipated Repayment Date, such
Mortgage Loan will accrue additional interest at the rate specified in the
related Mortgage Note and the Mortgagor is required to apply excess monthly cash
flow generated by the related Mortgaged Property to the repayment of the
outstanding principal balance on such Mortgage Loan.
"Assignment of Leases": With respect to any Mortgaged Property, any
assignment of leases, rents and profits or similar document or instrument
executed by the Mortgagor in connection with the origination of the related
Mortgage Loan.
"Assumed Scheduled Payment": With respect to any Balloon Mortgage
Loan for its Stated Maturity Date (provided that such Mortgage Loan has not been
paid in full and no other Liquidation Event has occurred in respect thereof on
or before such Stated Maturity Date) and for any subsequent Due Date therefor as
of which such Mortgage Loan remains outstanding and part of the Trust Fund, the
scheduled monthly payment of principal and/or interest deemed to be due in
respect thereof on such Due Date equal to the Scheduled Payment that would have
been due in respect of such Mortgage Loan on such Due Date if it had been
required to continue to pay principal in accordance with the amortization
schedule, if any, and to accrue interest at the Mortgage Rate, in effect on the
Closing Date and without regard to the occurrence of its Stated Maturity Date.
With respect to any REO Loan, for any Due Date therefor as of which the related
REO Property remains part of the Trust Fund, the scheduled monthly payment of
principal and/or interest deemed to be due in respect thereof on such Due Date
equal to the Scheduled Payment that would have been due in respect of the
predecessor Mortgage Loan on such Due Date had it remained outstanding (or, if
the predecessor Mortgage Loan was a Balloon Mortgage Loan and such Due Date
coincides with or follows what had been its Stated Maturity Date, the Assumed
Scheduled Payment that would have been deemed due in respect of the predecessor
Mortgage Loan on such Due Date had it remained outstanding).
"Authenticating Agent": Any authenticating agent appointed pursuant
to Section 8.12 (or, in the absence of any such appointment, the Trustee).
"Available Distribution Amount": With respect to any Distribution
Date, an amount equal to (a) the sum of, without duplication, (i) the aggregate
of the amounts on deposit in the Certificate Account and the Distribution
Account as of the close of business on the related Determination Date and the
amounts collected by or on behalf of the Master Servicer as of the close of
business on such Determination Date and required to be deposited in the
Certificate Account, (ii) the aggregate amount of any P&I Advances made by the
Master Servicer or the Trustee for distribution on the Certificates on such
Distribution Date pursuant to Section 4.03, (iii) the aggregate amount
transferred from the REO Account (if established)
<PAGE>
7
to the Certificate Account during the month of such Distribution Date, on or
prior to the P&I Advance Date in such month, pursuant to Section 3.16(c), (iv)
the aggregate amount deposited by the Master Servicer in the Distribution
Account for such Distribution Date pursuant to Section 3.19 in connection with
Prepayment Interest Shortfalls, and (v) for each Distribution Date occurring in
March, the aggregate of the Interest Reserve Amounts in respect of each Interest
Reserve Loan deposited into the Distribution Account pursuant to Section
3.05(c), net of (b) the portion of the amount described in subclauses (a)(i) and
(a)(iii) of this definition that represents one or more of the following: (i)
collected Monthly Payments that are due on a Due Date following the end of the
related Collection Period, (ii) any amounts payable or reimbursable to any
Person from the (A) Certificate Account pursuant to clauses (ii)-(xiv) of
Section 3.05(a) or (B) the Distribution Account pursuant to clauses (ii) - (vi)
of Section 3.05(b), (iii) Prepayment Premiums and Yield Maintenance Charges,
(iv) Additional Interest, (v) with respect to the Distribution Date occurring
during February of each year and during January of each year that is not a leap
year, the Interest Reserve Amounts with respect to the Interest Reserve Loans to
be withdrawn from the Certificate Account and deposited in the Interest Reserve
Account in respect of such Distribution Date and held for future distribution
pursuant to Section 3.04(c) and (vi) any amounts deposited in the Certificate
Account or the Distribution Account in error.
"Balloon Mortgage Loan": Any Mortgage Loan that by its original
terms or by virtue of any modification entered into as of the Closing Date
provides for an amortization schedule extending beyond its Stated Maturity Date.
"Balloon Payment": With respect to any Balloon Mortgage Loan as of
any date of determination, the Scheduled Payment payable on the Stated Maturity
Date of such Mortgage Loan.
"Bankruptcy Code": The federal Bankruptcy Code, as amended from time
to time (Title 11 of the United States Code).
"Book-Entry Certificate": Any Certificate registered in the name of
the Depository or its nominee.
"Breach": As defined in Section 2.03(a).
"Business Day": Any day other than a Saturday, a Sunday or a day on
which banking institutions in New York, New York, Rockville, Maryland,
Minneapolis, Minnesota, or the cities in which the Corporate Trust Office of the
Trustee (which as of the Closing Date is Columbia, Maryland) or the offices of
the Master Servicer (as of the Closing Date, Charlotte, North Carolina) are
located, are authorized or obligated by law or executive order to remain closed.
"CERCLA": The Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.
<PAGE>
8
"Certificate": Any one of the First Union-Lehman Brothers-Bank of
America Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 1998-C2, as executed by the Certificate Registrar and
authenticated and delivered hereunder by the Authenticating Agent.
"Certificate Account": The segregated account or accounts created
and maintained by the Master Servicer pursuant to Section 3.04(a) on behalf of
the Trustee in trust for Certificateholders, which shall be entitled "First
Union National Bank, as Master Servicer for NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee, on behalf of and in trust for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust,
Commercial Mortgage Pass-Through Certificates, Series 1998-C2".
"Certificate Factor": With respect to any Class of Regular
Certificates (other than the Class IO Certificates), as of any date of
determination, a fraction, expressed as a decimal carried to eight places, the
numerator of which is the then current Class Principal Balance of such Class of
Regular Certificates, and the denominator of which is the related Original Class
Principal Balance.
"Certificate Notional Amount": With respect to any Class IO
Certificate, as of any date of determination, the then notional amount of such
Certificate equal to the product of (a) the Percentage Interest evidenced by
such Certificate, multiplied by (b) the then Class Notional Amount of the Class
IO Certificates.
"Certificate Owner": With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Certificate as reflected on the books
of the Depository or on the books of a Depository Participant or on the books of
an indirect participating brokerage firm for which a Depository Participant acts
as agent.
"Certificate Principal Balance": With respect to any Sequential Pay
Certificate, as of any date of determination, the then outstanding principal
amount of such Certificate equal to the product of (a) the Percentage Interest
evidenced by such Certificate, multiplied by (b) the then Class Principal
Balance of the Class of Certificates to which such Certificate belongs.
"Certificate Register" and "Certificate Registrar": The register
maintained and the registrar appointed pursuant to Section 5.02.
"Certificateholder": The Person in whose name a Certificate is
registered in the Certificate Register, except that (i) neither a Disqualified
Organization nor a Non-United States Person shall be Holder of a Residual
Certificate for any purpose hereof and, (ii) solely for the purposes of giving
any consent, approval or waiver pursuant to this Agreement that relates to any
of the Depositor, any Mortgage Loan Seller, the Master Servicer, the Special
Servicer, or the Trustee in its respective capacity as such (except with respect
to amendments referred to in Sections 3.20(d) and 11.01 hereof and any consent,
approval or waiver required
<PAGE>
9
or permitted to be made by the Majority Subordinate Certificateholder or the
Controlling Class Representative and any election, removal or replacement of the
Special Servicer or the Controlling Class Representative pursuant to Section
6.09), any Certificate registered in the name of the Depositor, any Mortgage
Loan Seller, the Master Servicer, the Special Servicer, or the Trustee, as the
case may be, or any Certificate registered in the name of any of its Affiliates,
shall be deemed not to be outstanding, and the Voting Rights to which it is
entitled shall not be taken into account in determining whether the requisite
percentage of Voting Rights necessary to effect any such consent, approval or
waiver that relates to it has been obtained. The Certificate Registrar shall be
entitled to request and rely upon a certificate of the Depositor, the Master
Servicer or the Special Servicer in determining whether a Certificate is
registered in the name of an Affiliate of such Person. All references herein to
"Holders" or "Certificateholders" shall reflect the rights of Certificate Owners
as they may indirectly exercise such rights through the Depository and the
Depository Participants, except as otherwise specified herein; provided,
however, that the parties hereto shall be required to recognize as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register.
"Class": Collectively, all of the Certificates bearing the same
alphabetical and, if applicable, numerical class designation.
"Class A Certificates": The Class A-1 and Class A-2 Certificates.
"Class A-1 Certificate": Any one of the Certificates with a "Class
A-1" designation on the face thereof, substantially in the form of Exhibit A-1
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class A-2 Certificate": Any one of the Certificates with a "Class
A-2" designation on the face thereof, substantially in the form of Exhibit A-2
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class B Certificate": Any one of the Certificates with a "Class B"
designation on the face thereof, substantially in the form of Exhibit A-5
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class C Certificate": Any one of the Certificates with a "Class C"
designation on the face thereof, substantially in the form of Exhibit A-6
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class D Certificate": Any one of the Certificates with a "Class D"
designation on the face thereof, substantially in the form of Exhibit A-7
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
<PAGE>
10
"Class E Certificate": Any one of the Certificates with a "Class E"
designation on the face thereof, substantially in the form of Exhibit A-8
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class F Certificate": Any one of the Certificates with a "Class F"
designation on the face thereof, substantially in the form of Exhibit A-9
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class G Certificate": Any one of the Certificates with a "Class G"
designation on the face thereof, substantially in the form of Exhibit A-10
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class H Certificate": Any of the Certificates with a "Class H"
designation on the face thereof, substantially in the form of Exhibit A-11
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class IO Certificate": Any one of the Certificates with a "Class
IO" designation on the face thereof, substantially in the form of Exhibit A-4
attached hereto, and evidencing a portion of each of the Components, each of
which Components shall constitute a separate "regular interest" in REMIC III for
purposes of the REMIC Provisions.
"Class J Certificate": Any one of the Certificates with a "Class J"
designation on the face thereof, substantially in the form of Exhibit A-12
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class K Certificate": Any of the Certificates with a "Class K"
designation on the face thereof, substantially in the form of Exhibit A-13
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class L Certificate": Any of the Certificates with a "Class L"
designation on the face thereof, substantially in the form of Exhibit A-14
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class M Certificate": Any of the Certificates with a "Class M"
designation on the face thereof, substantially in the form of Exhibit A-15
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class N Certificate": Any of the Certificates with a "Class N"
designation on the face thereof, substantially in the form of Exhibit A-16
attached hereto, and evidencing a portion of a "regular interest" in REMIC III
for purposes of the REMIC Provisions.
"Class Notional Amount": As of any date of determination, the sum of
the then Component Notional Amounts of all of the Components.
<PAGE>
11
"Class Principal Balance": The aggregate principal balance of any
Class of Sequential Pay Certificates outstanding from time to time. As of the
Closing Date, the Class Principal Balance of each Class of Sequential Pay
Certificates shall equal the Original Class Principal Balance thereof. On each
Distribution Date, the Class Principal Balance of each such Class of
Certificates shall be reduced by the amount of any distributions of principal
made thereon on such Distribution Date pursuant to Section 4.01 or 9.01, as
applicable, and shall be further reduced by the amount of any Realized Losses
and Additional Trust Fund Expenses allocated thereto on such Distribution Date
pursuant to Section 4.04(a). Distributions in respect of a reimbursement of
Realized Losses and Additional Trust Fund Expenses previously allocated to a
Class of Sequential Pay Certificates shall not constitute distributions of
principal and shall not result in reduction of the related Class Principal
Balance.
"Class R-I Certificate": Any one of the Certificates with a "Class
R-I" designation on the face thereof, substantially in the form of Exhibit A-17
attached hereto, and evidencing a portion of the sole class of "residual
interests" in REMIC I for purposes of the REMIC Provisions.
"Class R-II Certificate": Any one of the Certificates with a "Class
R-II" designation on the face thereof, substantially in the form of Exhibit A-18
attached hereto, and evidencing a portion of the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions.
"Class R-III Certificate": Any one of the Certificates with a "Class
R-III" designation on the face thereof, substantially in the form of Exhibit
A-19 attached hereto, and evidencing a portion of the sole class of "residual
interests" in REMIC III for purposes of the REMIC Provisions.
"Closing Date": May 28, 1998.
"Code": The Internal Revenue Code of 1986, as amended.
"Collection Period": With respect to any Distribution Date, the
period commencing on the day immediately following the Determination Date for
the preceding Distribution Date (or, in the case of the initial Distribution
Date, commencing immediately following the Cut-off Date) and ending on and
including the related Determination Date.
"Comparative Financial Status Report": A report substantially
containing the content described in Exhibit N attached hereto, setting forth,
among other things, the occupancy, revenue, net operating income and Debt
Service Coverage Ratio for each Mortgage Loan or the related Mortgaged Property,
calculated as of the last day of the calendar month immediately preceding the
preparation of such report, for (i) each of the three immediately preceding
monthly periods (to the extent such information is available), (ii) the most
current available year-to-date, (iii) the previous two full fiscal years stated
separately,
<PAGE>
12
and (iv) the "base year" (representing the original analysis of information used
as of the Cut-off Date). For the purposes of the Special Servicer's production
of any such report that is required to state information for any period prior to
the Cut-off Date, the Special Servicer may conclusively rely (without
independent verification), absent manifest error, on information provided to it
by the related Mortgage Loan Seller.
"Component": Each of Component IO-A-1, Component IO-A-2, Component
IO-B, Component IO-C, Component IO-D, Component IO-E, Component IO-F, Component
IO-G, Component IO-H, Component IO-J, Component IO-K, Component IO-L, Component
IO-M and Component IO-N, each evidencing a separate "regular interest" in REMIC
III for purposes of the REMIC Provisions. Such Components are collectively
evidenced by the Class IO Certificates.
"Component IO-A-1": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest M as of any date
of determination.
"Component IO-A-2": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest N as of any date
of determination.
"Component IO-B": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest O as of any date
of determination.
"Component IO-C": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest P as of any date
of determination.
"Component IO-D": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest Q as of any date
of determination.
"Component IO-E": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest R as of any date
of determination.
"Component IO-F": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest S as of any date
of determination.
"Component IO-G": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest T as of any date
of determination.
<PAGE>
13
"Component IO-H": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest U as of any date
of determination.
"Component IO-J": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest V as of any date
of determination.
"Component IO-K": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest W as of any date
of determination.
"Component IO-L": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest X as of any date
of determination.
"Component IO-M": One of fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest Y as of any date
of determination.
"Component IO-N": One of the fourteen components of the Class IO
Certificates having a Component Notional Amount equal to the then current
Uncertificated Principal Balance of REMIC II Regular Interest Z as of any date
of determination.
"Component Notional Amount": With respect to each Component, as of
any date of determination, an amount equal to the then Uncertificated Principal
Balance of its Corresponding REMIC II Regular Interest.
"Controlling Class": As of any date of determination, the Class of
Sequential Pay Certificates, (a) which bears the latest alphabetical Class
designation and (b) the Class Principal Balance of which is greater than 25% of
the Original Class Principal Balance thereof; provided, however, that if no
Class of Sequential Pay Certificates has a Class Principal Balance greater than
25% of its Original Class Principal Balance, the Controlling Class shall be the
outstanding Class of Certificates (other than the Residual Certificates or the
Class IO Certificates) bearing the latest alphabetical Class designation. With
respect to determining the Controlling Class, the Class A-1 and Class A-2
Certificates shall be deemed a single Class of Certificates.
"Controlling Class Representative": As defined in Section 6.09.
"Corporate Trust Office": The principal corporate trust office of
the Trustee at which at any particular time its corporate trust business with
respect to this Agreement shall be administered, which office at the date of the
execution of this Agreement is located at 11000 Broken Land Parkway, Columbia,
Maryland 21044-3562, Attn: Corporate Trust Services
<PAGE>
14
(CMBS) -- First Union - Lehman Brothers - Bank of America Commercial Mortgage
Trust, Series 1998-C2.
"Corrected Mortgage Loan": Any Mortgage Loan that had been a
Specially Serviced Mortgage Loan but has ceased to be such in accordance with
the definition of "Specially Serviced Mortgage Loan".
"Corresponding Component": As defined in the Preliminary Statement
with respect to any Class of Sequential Pay Certificates or any REMIC II Regular
Interest.
"Corresponding REMIC II Regular Interest": As defined in the
Preliminary Statement with respect to any Class of Sequential Pay Certificates
or any Component of the Class IO Certificates.
"Credit Lease": With respect to each Credit Lease Loan, the lease
agreement between the Mortgagor as lessor and the Tenant as lessee of the
related Mortgaged Property.
"Credit Lease Loan": Each Mortgage Loan that is identified as a
"Credit Lease Loan" on the Mortgage Loan Schedule.
"CSSA Loan File Report": The monthly report in the "CSSA loan file"
format substantially containing the information called for therein for the
Mortgage Loans, a form of which is attached hereto as Exhibit W.
"CSSA Property File Report": The monthly report in the "CSSA
property file" format substantially containing the information called for
therein for each Mortgaged Property, a form of which is attached hereto as
Exhibit M.
"Custodian": A Person who is at any time appointed by the Trustee
pursuant to Section 8.11 as a document custodian for the Mortgage Files, which
Person shall not be the Depositor, a Mortgage Loan Seller or an Affiliate of the
Depositor or any Mortgage Loan Seller. If no such custodian has been appointed
or if such custodian has been so appointed, but the Trustee shall have
terminated such appointment, then the Trustee shall be the Custodian.
"Cut-off Date": For each Mortgage Loan with a Due Date that occurs
on the first of the month, May 1, 1998 and, for each other Mortgage Loan, the
day of the month in May 1998 on which the related Due Date for such Mortgage
Loan occurs.
"Cut-off Date Balance": With respect to any Mortgage Loan, the
outstanding principal balance of such Mortgage Loan as of the Cut-off Date,
after application of all unscheduled payments of principal received on or before
such date and the principal component of all Monthly Payments due on or before
such date, whether or not received.
"Debt Service Coverage Ratio": With respect to any Mortgage Loan, as
of any date of determination, the ratio of (x) the annualized Net Operating
Income (before payment of
<PAGE>
15
any debt service on such Mortgage Loan) generated by the related Mortgaged
Property during the most recently ended period of not less than six months and
not more than twelve months for which financial statements, if available
(whether or not audited) have been received by or on behalf of the related
Mortgage Loan Seller (prior to the Closing Date) or the Master Servicer or the
Special Servicer (following the Closing Date), to (y) twelve times the amount of
the Monthly Payment in effect for such Mortgage Loan as of such date of
determination.
"Deemed Due Date Mortgage Loan": Each of the Mortgage Loans with
control numbers 459 and 460 (and any related REO Loan).
"Defaulted Mortgage Loan": A Mortgage Loan (i) that is delinquent in
an amount equal to at least two Monthly Payments (not including the Balloon
Payment) or is delinquent thirty days or more in respect of its Balloon Payment,
in either case such delinquency to be determined without giving effect to any
grace period permitted by the related Mortgage or Mortgage Note and without
regard to any acceleration of payments under the related Mortgage and Mortgage
Note, or (ii) as to which the Master Servicer or the Special Servicer has, by
written notice to the related Mortgagor, accelerated the maturity of the
indebtedness evidenced by the related Mortgage Note.
"Defeasance Collateral": With respect to any Defeasance Loan, the
United States Treasury obligations required or permitted to be pledged in lieu
of prepayment pursuant to the terms thereof.
"Defeasance Loan": Any Mortgage Loan identified as a Defeasance Loan
on the Mortgage Loan Schedule which requires the related Mortgagor (or permits
the holder of such Mortgage Loan to require the related Mortgagor) to pledge
Defeasance Collateral to such holder in lieu of prepayment.
"Definitive Certificate": As defined in Section 5.03(a).
"Delinquent Loan Status Report": A report substantially containing
the content described in Exhibit Q attached hereto, setting forth, among other
things, those Mortgage Loans which, as of the close of business on the
Determination Date immediately preceding the preparation of such report, were
delinquent 30-59 days, delinquent 60-89 days, delinquent 90 days or more,
current but constituted Specially Serviced Mortgage Loans, or were in
foreclosure but were not REO Property.
"Depositor": First Union Commercial Mortgage Securities, Inc. or its
successor in interest.
"Depository": The Depository Trust Company, or any successor
Depository hereafter named as contemplated by Section 5.03(c). The nominee of
the initial Depository for purposes of registering those Certificates that are
to be Book-Entry Certificates, is Cede & Co. The Depository shall at all times
be a "clearing corporation" as defined in Section 8-102(3) of the Uniform
Commercial Code of the State of New York and a "clearing agency"
<PAGE>
16
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934, as amended.
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the
10th day of the month in which such Distribution Date occurs, or if such 10th
day is not a Business Day, the Business Day immediately preceding.
"Directly Operate": With respect to any REO Property, the furnishing
or rendering of services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for sale or lease,
the performance of any construction work thereon or any use of such REO Property
in a trade or business conducted by REMIC I other than through an Independent
Contractor; provided, however, that the Trustee (or the Special Servicer or any
Sub-Servicer on behalf of the Trustee) shall not be considered to Directly
Operate an REO Property solely because the Trustee (or the Special Servicer or
any Sub-Servicer on behalf of the Trustee) establishes rental terms, chooses
tenants, enters into or renews leases, deals with taxes and insurance, or makes
decisions as to repairs or capital expenditures with respect to such REO
Property.
"Discount Rate": With respect to any prepaid Mortgage Loan or REO
Loan for purposes of allocating any Prepayment Premium or Yield Maintenance
Charge received thereon or with respect thereto among the respective Classes of
the Sequential Pay Certificates (other than any Excluded Class thereof), an
amount equal to the yield (when compounded monthly) on the U.S. Treasury issue
(primary issue) with a maturity date closest to the maturity date for such
prepaid Mortgage Loan or REO Loan. In the event there are two such U.S. Treasury
issues (a) with the same coupon, the issue with the lower yield shall apply, and
(b) with maturity dates equally close to the maturity date for the prepaid
Mortgage Loan or REO Loan, the issue with the earliest maturity date shall
apply.
"Disqualified Organization": Any of the following: (i) the United
States or a possession thereof, any State or any political subdivision thereof,
or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for FHLMC, a majority of its board of directors is not selected
by any such governmental unit), (ii) a foreign government, international
organization, or any agency or instrumentality of either of the foregoing, (iii)
any organization (except certain farmers' cooperatives described in Section 521
of the Code) which is exempt from the tax imposed by Chapter 1 of the Code
(unless such organization is subject to the tax imposed by Section 511 of the
Code on unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381 of the Code or (v) any other Person so
designated by the Trustee or the Certificate Registrar based upon an Opinion of
Counsel that the holding of an Ownership Interest in a Residual Certificate by
such Person
<PAGE>
17
may cause the Trust Fund or any Person having an Ownership Interest in any Class
of Certificates, other than such Person, to incur a liability for any federal
tax imposed under the Code that would not otherwise be imposed but for the
Transfer of an Ownership Interest in a Residual Certificate to such Person. The
terms "United States", "State" and "international organization" shall have the
meanings set forth in Section 7701 of the Code or successor provisions.
"Distributable Certificate Interest": With respect to any Class of
Regular Certificates for any Distribution Date, the Accrued Certificate Interest
in respect of such Class of Certificates for such Distribution Date, reduced (to
not less than zero) by the product of (i) any Net Aggregate Prepayment Interest
Shortfall for such Distribution Date, multiplied by (ii) a fraction, expressed
as a decimal, the numerator of which is the Accrued Certificate Interest in
respect of such Class of Certificates for such Distribution Date, and the
denominator of which is the aggregate Accrued Certificate Interest in respect of
all the Classes of Regular Certificates for such Distribution Date.
"Distribution Account": The segregated account or accounts created
and maintained by the Paying Agent on behalf of the Trustee pursuant to Section
3.04(b) which shall be entitled "NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
as Trustee, in trust for the registered holders of First Union-Lehman
Brothers-Bank of America Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2"
"Distribution Date": The 18th day of any month, or if such 18th day
is not a Business Day, the Business Day immediately following, commencing on
June 18, 1998.
"Distribution Date Statement": As defined in Section 4.02(a).
"Document Defect": As defined in Section 2.03(a).
"Due Date": With respect to (i) any Mortgage Loan on or prior to its
Stated Maturity Date, the day of the month set forth in the related Mortgage
Note on which each Monthly Payment on such Mortgage Loan is scheduled to be
first due; (ii) any Mortgage Loan after its Stated Maturity Date, the day of the
month set forth in the related Mortgage Note on which each Monthly Payment on
such Mortgage Loan had been scheduled to be first due; and (iii) any REO Loan,
the day of the month set forth in the related Mortgage Note on which each
Monthly Payment on the related Mortgage Loan had been scheduled to be first due.
"Eligible Account": Any of (i) an account maintained with a federal
or state chartered depository institution or trust company, and with respect to
deposits held for 30 days or more in such account the (a) long-term deposit or
unsecured debt obligations of which (or of such institution's parent holding
company) are rated "A+" by Standard & Poor's and "A2" by Moody's (if then rated
by Moody's) (or, with respect to any such Rating Agency, such lower rating as
will not result in qualification, downgrading or withdrawal of the ratings then
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18
assigned to the Certificates, as evidenced in writing by the applicable Rating
Agency), at any time such funds are on deposit therein, or with respect to
deposits held for less than 30 days in such account the (b) short-term deposits
of which (or of such institution's parent holding company) are rated P-1 by
Moody's (if then rated by Moody's) and A-1 by Standard & Poor's (or, with
respect to any such Rating Agency, such lower rating as will not result in
qualification, downgrading or withdrawal of the ratings then assigned to the
Certificates) as evidenced in writing by the applicable Rating Agency at any
time such funds are on deposit therein, or (ii) a segregated trust account or
accounts maintained with a federal or state chartered depository institution or
trust company acting in its fiduciary capacity, which, in the case of a state
chartered depository institution or trust company, is subject to regulations
regarding fiduciary funds on deposit therein substantially similar to 12 CFR ss.
9.10(b), having in either case a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authority, or the use of such account would not, in and of itself, cause a
qualification, downgrading or withdrawal of the then-current rating assigned to
any Class of Certificates, as confirmed in writing by each Rating Agency.
"Environmental Assessment": A "Phase I assessment" as described in,
and meeting the criteria of, (a) (i) Chapter 5 of the FNMA Multifamily Guide or
any successor provisions covering the same subject matter, in the case of
Specially Serviced Mortgage Loans as to which the related Mortgaged Property is
a multifamily property, or (ii) the Servicing Standard, in the case of any other
Specially Serviced Mortgage Loans, and (b) the American Society for Testing and
Materials.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended.
"Escrow Payment": Any payment received by the Master Servicer or the
Special Servicer for the account of any Mortgagor for application toward the
payment of real estate taxes, assessments, insurance premiums, ground rents (if
applicable) and other items for which an escrow or reserve has been created in
respect of the related Mortgaged Property.
"Event of Default": One or more of the events described in Section
7.01(a).
"Exchange Act": Securities Exchange Act of 1934, as amended.
"Excluded Class": Any Class of Sequential Pay Certificates other
than the Class A-1 Certificates, Class A-2 Certificates, Class B Certificates,
Class C Certificates, Class D Certificates, Class E Certificates and Class F
Certificates.
"FDIC": Federal Deposit Insurance Corporation or any successor.
"FHLMC": Federal Home Loan Mortgage Corporation or any successor.
"Final Recovery Determination": A determination by the Special
Servicer with respect to any Defaulted Mortgage Loan or REO Property (other than
a Mortgage Loan or
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19
REO Property, as the case may be, that was purchased by any of the Mortgage Loan
Sellers, pursuant to the related Mortgage Loan Purchase Agreement, by the
Majority Subordinate Certificateholder pursuant to Section 3.18(b), by the
Master Servicer or the Special Servicer pursuant to Section 3.18(c) or by the
Depositor, the Master Servicer, the Special Servicer, an Underwriter or the
Majority Subordinate Certificateholder pursuant to Section 9.01) that there has
been a recovery of all Insurance Proceeds, Liquidation Proceeds and other
payments or recoveries that the Special Servicer has determined, in accordance
with the Servicing Standard, will be ultimately recoverable.
"First Union Capital": First Union Capital Markets, a division of
Wheat First Securities, Inc. or its successor in interest.
"FNMA": Federal National Mortgage Association or any successor.
"Grantor Trust": That certain "grantor trust" (within the meaning of
the Grantor Trust Provisions), the assets of which are the Grantor Trust Assets.
"Grantor Trust Assets": Any Additional Interest collected with
respect to the ARD Loans after their respective Anticipated Repayment Dates.
"Grantor Trust Provisions": Subpart E of Subchapter J of the Code.
"Ground Lease": With respect to any Mortgage Loan for which the
Mortgagor has a leasehold interest in the related Mortgaged Property or space
lease within such Mortgaged Property, the lease agreement creating such
leasehold interest.
"Guaranty": With respect to a Credit Lease Loan, a guaranty
agreement executed by an affiliate of the related Tenant that guarantees the
Tenant's obligations under the related Credit Lease.
"Hazardous Materials": Any dangerous, toxic or hazardous pollutants,
chemicals, wastes, or substances, including, without limitation, those so
identified pursuant to CERCLA or any other federal, state or local environmental
related laws and regulations now existing or hereafter enacted, and specifically
including, without limitation, asbestos and asbestos-containing materials,
polychlorinated biphenyls ("PCBs"), radon gas, petroleum and petroleum products
and urea formaldehyde.
"Historical Loan Modification Report": A report substantially
containing the information described in Exhibit R attached hereto, setting
forth, among other things, those Mortgage Loans which, as of the close of
business on the Determination Date immediately preceding the preparation of such
report, have been modified pursuant to this Agreement (i) during the related
Collection Period and (ii) since the Cut-off Date, showing the original and the
revised terms thereof.
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20
"Historical Loss Estimate Report": A report substantially containing
the information described in Exhibit S attached hereto, setting forth, among
other things, as of the close of business on the Determination Date immediately
preceding the preparation of such report, (i) the aggregate amount of
Liquidation Proceeds and expenses relating to each Final Recovery Determination
made, both during the related Collection Period and historically, and (ii) the
amount of Realized Losses occurring during the related Collection Period, set
forth on a Mortgage Loan-by-Mortgage Loan basis.
"Holder": A Certificateholder.
"HUD-Approved Servicer": A servicer approved by the Secretary of
Housing and Urban Development pursuant to Section 207 of the National Housing
Act.
"Impound Reserve": As defined in Section 3.16(c) hereof.
"Independent": When used with respect to any specified Person, any
such Person who (i) is in fact independent of the Depositor, the Mortgage Loan
Sellers, the Master Servicer, the Special Servicer, the Trustee and any and all
Affiliates thereof, (ii) does not have any direct financial interest in or any
material indirect financial interest in any of the Depositor, the Master
Servicer, the Special Servicer, the Trustee, any Mortgage Loan Seller or any
Affiliate thereof, and (iii) is not connected with the Depositor, the Master
Servicer, the Special Servicer, the Trustee, any Mortgage Loan Seller or any
Affiliate thereof as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions; provided, however,
that a Person shall not fail to be Independent of the Depositor, the Master
Servicer, the Special Servicer, the Trustee, any Mortgage Loan Seller or any
Affiliate thereof merely because such Person is the beneficial owner of 1% or
less of any class of securities issued by the Depositor, the Master Servicer,
the Special Servicer, the Trustee, such Mortgage Loan Seller or any Affiliate
thereof, as the case may be.
"Independent Appraiser": An Independent professional real estate
appraiser who is a member in good standing of the Appraisal Institute, and, if
the State in which the subject Mortgaged Property is located certifies or
licenses appraisers, certified or licensed in such State, and in each such case,
who has a minimum of five years experience in the subject property type and
market.
"Independent Contractor": Any Person that would be an "independent
contractor" with respect to REMIC I within the meaning of Section 856(d)(3) of
the Code if REMIC I were a real estate investment trust (except that the
ownership test set forth in that section shall be considered to be met by any
Person that owns, directly or indirectly, 35 percent or more of any Class of
Certificates, or such other interest in any Class of Certificates as is set
forth in an Opinion of Counsel, which shall be at no expense to the Master
Servicer, the Special Servicer, the Trustee or the Trust Fund, delivered to the
Trustee), so long as REMIC I does not receive or derive any income from such
Person and provided that the relationship between such Person and REMIC I is at
arm's length, all within the meaning of
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21
Treasury Regulations Section 1.856-4(b)(5), or any other Person upon receipt by
the Trustee of an Opinion of Counsel, which shall be at no expense to the Master
Servicer, the Special Servicer, the Trustee or the Trust Fund, to the effect
that the taking of any action in respect of any REO Property by such Person,
subject to any conditions therein specified, that is otherwise herein
contemplated to be taken by an Independent Contractor will not cause such REO
Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code, or cause any income realized in respect of such
REO Property to fail to qualify as Rents from Real Property.
"Insurance Policy": With respect to any Mortgage Loan, any hazard
insurance policy, flood insurance policy, title policy or other insurance policy
that is maintained from time to time in respect of such Mortgage Loan or the
related Mortgaged Property.
"Insurance Proceeds": Proceeds paid under any Insurance Policy, to
the extent such proceeds are not applied to the restoration of the related
Mortgaged Property, released to the Mortgagor, or any tenants or ground lessors,
as the case may be, pursuant to the terms of the related Mortgage or lease, in
accordance with the Servicing Standard.
"Interest Reserve Account": The segregated account created and
maintained by the Master Servicer pursuant to Section 3.04(c) on behalf of the
Trustee in trust for Certificateholders, which shall be entitled "First Union
National Bank, as Master Servicer for NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee, on behalf of and in trust for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust,
Commercial Mortgage Pass-Through Certificates, Series 1998-C2".
"Interest Reserve Amount": With respect to each Interest Reserve
Loan and each Distribution Date that occurs during February of each year and
during January of each year that is not a leap year, an amount equal to one
day's interest on the related Stated Principal Balance as of the Due Date in the
month in which such Distribution Date occurs (but prior to the application of
any amounts owed on such Due Date), to the extent a Monthly Payment or P&I
Advance is made in respect thereof for such Due Date as of the related P&I
Advance Date.
"Interest Reserve Loan": Each Mortgage Loan that is an Actual/360
Mortgage Loan and accrues interest at a Mortgage Rate of less than 7.50% per
annum.
"Interested Person": The Depositor, the Mortgage Loan Sellers, the
Master Servicer, the Special Servicer, any Holder of a Certificate, or any
Affiliate of any such Person.
"Internet Website": The Internet Websites maintained by the Trustee
and, if applicable, the Master Servicer initially located at
"www.securitieslink.net/cmbs" and "www.firstunion.com/strprod/cms",
respectively, or such other address as provided to the parties hereto from time
to time.
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22
"Investment Account": As defined in Section 3.06(a).
"Issue Price": With respect to each Class of Certificates, the
"issue price" as defined in the Code and Treasury regulations promulgated
thereunder.
"Late Collections": With respect to any Mortgage Loan, all amounts
received thereon during any Collection Period, other than Penalty Interest,
whether as payments, Insurance Proceeds, Liquidation Proceeds or otherwise,
which represent late collections of the principal and/or interest portions of a
Scheduled Payment (other than a Balloon Payment) or an Assumed Scheduled Payment
in respect of such Mortgage Loan due or deemed due on a Due Date in a previous
Collection Period, or on a Due Date coinciding with or preceding the Cut-off
Date, and not previously recovered. With respect to any REO Loan, all amounts
received in connection with the related REO Property during any Collection
Period, whether as Insurance Proceeds, Liquidation Proceeds, REO Revenues or
otherwise, which represent late collections of the principal and/or interest
portions of a Scheduled Payment (other than a Balloon Payment) or an Assumed
Scheduled Payment in respect of the predecessor Mortgage Loan or of an Assumed
Scheduled Payment in respect of such REO Loan due or deemed due on a Due Date in
a previous Collection Period and not previously recovered.
"Lease Enhancement Policy": With respect to a Credit Lease Loan, any
non-cancelable residual value insurance policy or credit lease enhancement
insurance policy that insures against certain losses arising out of casualty
and/or condemnation of the related Mortgaged Property.
"Lease Enhancement Policy Issuer": With respect to any Lease
Enhancement Policy, Chubb Custom Insurance Company together with any assignee,
successor or subsequent insurer thereunder.
"Lease Enhancement Policy Termination Event": With respect to any
Lease Enhancement Policy, any abatement, rescission, cancellation, termination,
contest, legal process, arbitration or disavowal of liability.
"Legal Final Distribution Date": With respect to (i) the REMIC I
Regular Interests, November 18, 2035, (ii) the REMIC II Regular Interests,
November 18, 2035, (iii) the Sequential Pay Certificates, November 18, 2035, and
(iv) all the Components of the Class IO Certificates, November 18, 2035.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made with respect to such Mortgage Loan; (iii) such Mortgage
Loan is repurchased by a Mortgage Loan Seller pursuant to the related Mortgage
Loan Purchase Agreement; or (iv) such Mortgage Loan is purchased by the Majority
Subordinate Certificateholder pursuant to Section 3.18(b), by the Master
Servicer or the Special Servicer pursuant to Section 3.18(c) or by the
Depositor, the Master Servicer, the Special Servicer, Lehman Brothers Inc. or
the Majority Subordinate Certificateholder
<PAGE>
23
pursuant to Section 9.01. With respect to any REO Property (and the related REO
Loan), any of the following events: (i) a Final Recovery Determination is made
with respect to such REO Property; or (ii) such REO Property is purchased by the
Depositor, the Master Servicer, the Special Servicer, Lehman Brothers Inc. or
the Majority Subordinate Certificateholder pursuant to Section 9.01.
"Liquidation Proceeds": All cash amounts (other than Insurance
Proceeds and REO Revenues) received by the Master Servicer or the Special
Servicer in connection with: (i) the taking of all or a part of a Mortgaged
Property or REO Property by exercise of the power of eminent domain or
condemnation, subject, however, to the rights of any tenants and ground lessors,
as the case may be, and the terms of the related Mortgage; (ii) the liquidation
of a Mortgaged Property or other collateral constituting security for a
defaulted Mortgage Loan, through trustee's sale, foreclosure sale, REO
Disposition or otherwise, exclusive of any portion thereof required to be
released to the related Mortgagor in accordance with applicable law and the
terms and conditions of the related Mortgage Note and Mortgage; (iii) the
realization upon any deficiency judgment obtained against a Mortgagor; (iv) the
purchase of a Defaulted Mortgage Loan by the Majority Subordinate
Certificateholder pursuant to Section 3.18(b) or by the Master Servicer or the
Special Servicer pursuant to Section 3.18(c) or any other sale thereof pursuant
to Section 3.18(d); (v) the repurchase of a Mortgage Loan by a Mortgage Loan
Seller pursuant to the related Mortgage Loan Purchase Agreement; or (vi) the
purchase of a Mortgage Loan or REO Property by the Depositor, the Master
Servicer, the Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder pursuant to Section 9.01.
"Loan Payoff Notification Report": A report substantially containing
the information described in Exhibit V attached hereto, and setting forth for
each Mortgage Loan where notice of anticipated payoff has been received as of
the Determination Date immediately preceding the preparation of such report,
among other things, the control number, the property name, the amount of
principal expected to be paid, the expected date of payment and the estimated
amount of Yield Maintenance Charge or Prepayment Premium due.
"Loan-to-Value Ratio": With respect to any Mortgage Loan, as of any
date of determination, a fraction, expressed as a percentage, the numerator of
which is the then current principal amount of such Mortgage Loan, and the
denominator of which is the Appraised Value of the related Mortgaged Property.
"Lockout Period": With respect to any Mortgage Note that prohibits
the Mortgagor from prepaying such Mortgage Loan until a date specified in such
Mortgage Note, the period from the Closing Date until the such specified date.
"Majority Subordinate Certificateholder": As of any date of
determination, any single Holder of Certificates entitled to greater than 50% of
the Voting Rights allocated to the Class of Sequential Pay Certificates with the
latest alphabetical Class designation then outstanding; provided, however, that
if there is no single Holder of Certificates entitled to greater than 50% of the
Voting Rights allocated to such Class, then the Majority Subordinate
Certificateholder shall be
<PAGE>
24
the single Holder of Certificates with the largest percentage of Voting Rights
allocated to such Class. With respect to determining the Majority Subordinate
Certificateholder, the Class A-1 and Class A-2 Certificates shall be deemed to
be a single Class of Certificates, with such Voting Rights allocated among the
Holders of Certificates of such Classes in proportion to the respective
Certificate Principal Balances of such Certificates as of such date of
determination.
"Master Servicer": First Union National Bank, its successor in
interest (including the Trustee as successor pursuant to Section 7.02), or any
successor master servicer appointed as herein provided.
"Master Servicing Fee": With respect to each Mortgage Loan and REO
Loan, the fee payable to the Master Servicer pursuant to Section 3.11(a).
"Master Servicing Fee Rate": With respect to each Mortgage Loan, the
percentage set forth under the column "Master Servicing Fee Rate" on the
Mortgage Loan Schedule that corresponds to such Mortgage Loan.
"Monthly Payment": With respect to any Mortgage Loan as of any Due
Date, the scheduled monthly payment (or, in the case of an ARD Loan after its
Anticipated Repayment Date, the minimum required monthly payment) of principal
and/or interest on such Mortgage Loan, including any Balloon Payment, that is
actually payable by the related Mortgagor from time to time under the terms of
the related Mortgage Note (as such terms may be changed or modified in
connection with a bankruptcy or similar proceeding involving the related
Mortgagor or by reason of a modification, waiver or amendment granted or agreed
to by the Special Servicer pursuant to Section 3.20); provided that the Monthly
Payment due in respect of any ARD Loan after its Anticipated Repayment Date
shall not include Additional Interest.
"Moody's": Moody's Investors Service, Inc. or its successor in
interest. If neither such rating agency nor any successor remains in existence,
"Moody's" shall be deemed to refer to such other nationally recognized
statistical rating agency or other comparable Person designated by the
Depositor, notice of which designation shall be given to the Trustee, the Master
Servicer and the Special Servicer, and specific ratings of Moody's Investors
Service, Inc. herein referenced shall be deemed to refer to the equivalent
ratings of the party so designated.
"Mortgage": With respect to any Mortgage Loan, the mortgage, deed of
trust, deed to secure debt or similar instrument that secures the Mortgage Note
and creates a lien on the related Mortgaged Property.
"Mortgage File": With respect to any Mortgage Loan, collectively the
following documents:
(i) the original executed Mortgage Note including any power of
attorney related to the execution thereof (or a lost note
affidavit and indemnity with a copy of such Mortgage Note
attached thereto), together with any
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25
and all intervening endorsements thereon, endorsed (without
recourse, representation or warranty, express or implied) to
the order of NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, as
trustee for the registered holders of First Union-Lehman
Brothers-Bank of America Commercial Mortgage Trust, Commercial
Mortgage Pass-Through Certificates, Series 1998-C2 or in
blank;
(ii) an original or copy of the Mortgage, together with any and all
intervening assignments thereof, in each case with evidence of
recording indicated thereon;
(iii) an original or copy of any related Assignment of Leases (if
such item is a document separate from the Mortgage), together
with any and all intervening assignments thereof, in each case
with evidence of recording indicated thereon;
(iv) an original executed assignment, in recordable form, of (a)
the Mortgage, (b) any related Assignment of Leases (if such
item is a document separate from the Mortgage) and (c) any
other recorded document relating to the Mortgage Loan
otherwise included in the Mortgage File, in favor of NORWEST
BANK MINNESOTA, NATIONAL ASSOCIATION, as trustee for the
registered holders of First Union-Lehman Brothers-Bank of
America Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as trustee for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 1998-C2;
(vi) originals or copies of any written modification agreements in
those instances where the terms or provisions of the Mortgage
or Mortgage Note have been modified;
(vii) the original or a copy of the policy or certificate of
lender's title insurance issued on the date of the origination
of such Mortgage Loan, or, if such policy has not been issued,
an irrevocable, binding commitment to issue such title
insurance policy; and
(viii) any filed copies (with evidence of filing) of any prior UCC
Financing Statements in favor of the originator of such
Mortgage Loan or in favor of any assignee prior to the Trustee
(but only to the extent the related
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26
Mortgage Loan Seller had possession of such UCC Financing
Statements prior to the Closing Date) and, if there is an
effective UCC Financing Statement in favor of the Mortgage
Loan Seller on record with the applicable public office for
UCC Financing Statements, an original UCC-2 or UCC-3
assignment, as appropriate, in form suitable for filing, as
appropriate, in favor of NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as trustee for the registered holders of First
Union-Lehman Brothers-Bank of America Commercial Mortgage
Trust, Commercial Mortgage Pass-Through Certificates, Series
1998-C2; and
(ix) an original or copy of any Ground Lease, any Credit Lease and
any Lease Enhancement Policy or Guaranty.
provided that whenever the term "Mortgage File" is used to refer to documents
actually received by the Trustee or by a Custodian on its behalf, such term
shall not be deemed to include such documents required to be included therein
unless they are actually so received, and with respect to any receipt or
certification by the Trustee or the Custodian for documents described in clause
(vi) of this definition, shall be deemed to include only such documents to the
extent the Trustee or Custodian has actual knowledge of their existence.
"Mortgage Loan": Each of the mortgage loans listed on the Mortgage
Loan Schedule and from time to time held in the Trust Fund. As used herein, the
term "Mortgage Loan" includes the related Mortgage Note, Mortgage, any Lease
Enhancement Policy and other security documents contained in the related
Mortgage File.
"Mortgage Loan Purchase Agreements": Those certain Mortgage Loan
Purchase Agreements, each dated as of May 1, 1998, between the Depositor and the
respective Mortgage Loan Seller and relating to the transfer of the related
Mortgage Loans to the Depositor.
"Mortgage Loan Schedule": The list of Mortgage Loans transferred on
the Closing Date to the Trustee as part of REMIC I, attached hereto as Exhibit B
and in a computer readable format. Such list shall set forth the following
information with respect to each Mortgage Loan:
(i) the Mortgage Loan number;
(ii) the street address (including city, state and zip code) and
name of the related Mortgaged Property;
(iii) the Cut-off Date Balance;
(iv) the amount of the Monthly Payment due on the first Due Date
following the Closing Date;
(v) the original Mortgage Rate;
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27
(vi) the (A) remaining term to stated maturity and (B) the Stated
Maturity Date;
(vii) in the case of a Balloon Mortgage Loan, the remaining
amortization term;
(viii) whether the Mortgage Loan is secured by a Ground Lease;
(ix) the Master Servicing Fee Rate and Additional Servicing Fee
Rate, if any;
(x) whether such Mortgage Loan is an ARD Loan and if so the
Anticipated Repayment Date and Additional Interest Rate for
such ARD Loan;
(xi) whether the Mortgage Loan is an Actual-360 Mortgage Loan;
(xii) the related Mortgage Loan Seller;
(xiii) whether the Mortgage Loan is a Credit Lease Loan and if so,
the related Tenant or guarantor of such Credit Lease Loan;
(xiv) whether such Mortgage Loan is insured by a Lease Enhancement
Policy and if so whether such policy is a residual value
insurance policy;
(xv) the debt service coverage ratio and loan to value ratio
(calculated in each case as set forth in the Prospectus
Supplement);
(xvi) whether such Mortgage Loan is cross-defaulted with any other
Mortgage Loan;
(xvii) whether such Mortgage Loan is a Defeasance Loan; and
(xviii) whether such Mortgage Loan is an Interest Reserve Loan.
"Mortgage Loan Seller": Any of First Union National Bank or its
successor in interest, Lehman Brothers Holdings Inc., doing business as Lehman
Capital, a Division of Lehman Brothers Holdings Inc., or its successor in
interest, and Bank of America NT&SA or its successor in interest.
"Mortgage Note": The original executed note evidencing the
indebtedness of a Mortgagor under a Mortgage Loan, together with any rider,
addendum or amendment thereto, or any renewal, substitution or replacement of
such note.
"Mortgage Pool": Collectively, all of the Mortgage Loans and any
successor REO Loans.
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28
"Mortgage Rate": With respect to (i) any Mortgage Loan on or prior
to its Stated Maturity Date, the fixed annualized rate, not including any
Additional Interest Rate, at which interest is scheduled (in the absence of a
default) to accrue on such Mortgage Loan from time to time in accordance with
the related Mortgage Note and applicable law; (ii) any Mortgage Loan after its
Stated Maturity Date or the annualized rate described in clause (i) above
determined without regard to the passage of such Stated Maturity Date, but
giving effect to any modification thereof as contemplated by Section 3.20; and
(iii) any REO Loan, the annualized rate described in clause (i) or (ii), as
applicable, above determined as if the predecessor Mortgage Loan had remained
outstanding.
"Mortgaged Property": The property subject to the lien of a
Mortgage.
"Mortgagor": The obligor or obligors on a Mortgage Note, including
without limitation, any Person that has acquired the related Mortgaged Property
and assumed the obligations of the original obligor under the Mortgage Note.
"Net Aggregate Prepayment Interest Shortfall": With respect to any
Distribution Date, the amount, if any, by which (a) the aggregate of all
Prepayment Interest Shortfalls incurred in connection with the receipt of
Principal Prepayments on the Mortgage Loans during the related Collection
Period, exceeds (b) the sum of (i) the aggregate amount deposited by the Master
Servicer in the Certificate Account for such Distribution Date pursuant to
Section 3.19(a) in connection with such Prepayment Interest Shortfalls and (ii)
the aggregate of all Prepayment Interest Excesses collected in connection with
the receipt of Principal Prepayments on the Mortgage Loans during the related
Collection Period.
"Net Investment Earnings": With respect to the Certificate Account,
the Interest Reserve Account, any Servicing Account, any Reserve Account, the
Distribution Account or the REO Account (if any) for any Collection Period, the
amount, if any, by which the aggregate of all interest and other income realized
during such Collection Period on funds held in such account, exceeds the
aggregate of all losses, if any, incurred during such Collection Period in
connection with the investment of such funds in accordance with Section 3.06.
"Net Investment Loss": With respect to the Certificate Account, the
Interest Reserve Account, any Servicing Account, any Reserve Account, the
Distribution Account or the REO Account (if any) for any Collection Period, the
amount by which the aggregate of all losses, if any, incurred during such
Collection Period in connection with the investment of funds held in such
account in accordance with Section 3.06, exceeds the aggregate of all interest
and other income realized during such Collection Period on such funds.
"Net Mortgage Rate": With respect to any Mortgage Loan or any REO
Loan, as of any date of determination, a rate per annum equal to the related
Mortgage Rate minus the sum of the Trustee Fee Rate, the Additional Servicing
Fee Rate and the applicable Master Servicing Fee Rate.
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29
"Net Operating Income or NOI": As defined in and determined in
accordance with the provisions of Exhibit E attached hereto.
"New Lease": Any lease of REO Property entered into on behalf of
REMIC I, including any lease renewed, modified or extended on behalf of REMIC I
if REMIC I has the right to renegotiate the terms of such lease.
"NOI Adjustment Worksheet": A report prepared by the Special
Servicer, substantially containing the content described in Exhibit T attached
hereto, presenting the computations made in accordance with the methodology
described in Exhibit T to "normalize" the full year net operating income and
debt service coverage numbers used in the other reports required by this
Agreement, delivered to the Master Servicer with each annual operating statement
for a Mortgaged Property pursuant to Section 3.12(b).
"Nonrecoverable Advance": Any Nonrecoverable P&I Advance or
Nonrecoverable Servicing Advance.
"Nonrecoverable P&I Advance": Any P&I Advance previously made or
proposed to be made in respect of any Mortgage Loan or REO Loan by the Master
Servicer or Trustee, as the case may be, that, as determined by the Master
Servicer in accordance with the Servicing Standard with respect to such P&I
Advance will not be ultimately recoverable from late payments, Insurance
Proceeds or Liquidation Proceeds, or any other recovery on or in respect of such
Mortgage Loan or REO Loan.
"Nonrecoverable Servicing Advance": Any Servicing Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Loan by the
Master Servicer, the Special Servicer or Trustee, as the case may be, that, as
determined by the Master Servicer, the Special Servicer or the Trustee in
accordance with the Servicing Standard, will not be ultimately recoverable from
late payments, Insurance Proceeds, Liquidation Proceeds, or any other recovery
on or in respect of such Mortgage Loan or REO Property.
"Non-Registered Certificate": Unless and until registered under the
Securities Act, any Class F, Class G, Class H, Class J, Class K, Class L, Class
M, Class N, Class R-I, Class R-II or Class R-III Certificate.
"Non-United States Person": Any Person other than a United States
Person.
"Officers' Certificate": A certificate signed by a Servicing Officer
of the Master Servicer or the Special Servicer, as the case may be, or by a
Responsible Officer of the Trustee.
"Operating Statement Analysis": With respect to each Mortgage Loan
and REO Mortgaged Property, a report prepared by the Special Servicer
substantially containing the content described in Exhibit U attached hereto.
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30
"Opinion of Counsel": A written opinion of counsel (which counsel
shall be Independent of the Depositor, the Master Servicer and the Special
Servicer) acceptable to and delivered to the Trustee or the Master Servicer, as
the case may be.
"Original Class Notional Amount": $3,408,048,239.
"Original Class Principal Balance": With respect to any Class of
Regular Certificates (other than the Class IO Certificates), the initial Class
Principal Balance thereof as of the Closing Date, in each case as specified in
the Preliminary Statement.
"OTS": The Office of Thrift Supervision or any successor thereto.
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate as the Holder thereof and any other
interest therein, whether direct or indirect, legal or beneficial, as owner or
as pledgee.
"Pass-Through Rate": With respect to:
(i) the Class A-1 Certificates for any Distribution Date, 6.280%
per annum;
(ii) the Class A-2 Certificates for any Distribution Date, 6.560%
per annum;
(iii) the Class B Certificates for any Distribution Date, 6.640% per
annum;
(iv) the Class C Certificates for any Distribution Date, 6.730% per
annum;
(v) the Class D Certificates for any Distribution Date, 6.778% per
annum;
(vi) the Class E Certificates for any Distribution Date, 6.778% per
annum;
(vii) the Class F Certificates for any Distribution Date, 6.778% per
annum;
(viii) the Class G Certificates for any Distribution Date, the
lesser of (A) 7.000% per annum and (B) the Weighted Average
REMIC I Remittance Rate for such Distribution Date;
(ix) the Class H Certificates for any Distribution Date, the lesser
of (A) 7.00% per annum and (B) the Weighted Average REMIC I
Remittance Rate for such Distribution Date;
(x) the Class J Certificates for any Distribution Date, 6.150% per
annum;
(xi) the Class K Certificates for any Distribution Date, 6.150% per
annum;
(xii) the Class L Certificates for any Distribution Date, 6.150% per
annum;
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31
(xiii) the Class M Certificates for any Distribution Date, 6.150%%
per annum;
(xiv) the Class N Certificates for any Distribution Date, 6.150% per
annum; and
(xv) each Component of the Class IO Certificates for any
Distribution Date, the excess, if any, of the REMIC II
Remittance Rate for such Distribution Date, over the
Pass-Through Rate applicable for such Distribution Date to
Class of Sequential Pay Certificates as to which it is the
Corresponding Component.
"Paying Agent": The paying agent appointed pursuant to Section 8.13.
If no such paying agent has been appointed or if such paying agent has been so
appointed, but the Trustee shall have terminated such appointment, then the
Trustee shall be the Paying Agent.
"Penalty Interest": With respect to any Mortgage Loan (or successor
REO Loan), any amounts collected thereon, other than late payment charges, or
Prepayment Premiums or Yield Maintenance Charges, that represent penalty
interest (arising out of a default) in excess of interest on the Stated
Principal Balance of such Mortgage Loan (or successor REO Loan) accrued at the
related Mortgage Rate.
"Percentage Interest": With respect to any Regular Certificate, the
portion of the relevant Class evidenced by such Certificate, expressed as a
percentage, the numerator of which is the Certificate Principal Balance or
Certificate Notional Amount, as the case may be, of such Certificate as of the
Closing Date, as specified on the face thereof, and the denominator of which is
the Original Class Principal Balance or Original Class Notional Amount, as the
case may be, of the relevant Class. With respect to a Residual Certificate, the
percentage interest in distributions to be made with respect to the relevant
Class, as stated on the face of such Certificate.
"Permitted Investments": Any one or more of the following
obligations or securities (including obligations or securities of the Trustee if
otherwise qualifying hereunder):
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States
or any agency or instrumentality thereof (having original
maturities of not more than 365 days), provided such
obligations are backed by the full faith and credit of the
United States. Such obligations must be limited to those
instruments that have a predetermined fixed dollar amount of
principal due at maturity that cannot vary or change. If
rated, such an obligation must not have an "r" highlighter
affixed to its rating by Standard & Poor's. Interest may
either by fixed or variable. If such interest is variable,
interest must be tied to a single interest rate index plus a
single fixed spread (if any), and move proportionately with
that index;
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32
(ii) repurchase obligations with respect to any security described
in clause (i) above (having original maturities of not more
than 365 days), provided that the short-term deposit or debt
obligations, of the party agreeing to repurchase such
obligations are rated in one of the two highest rating
categories of each of Moody's and Standard & Poor's or such
lower rating as will not result in qualification, downgrading
or withdrawal of the ratings then assigned to the
Certificates, as evidenced in writing by the Rating Agencies.
In addition, any such item must not have an "r" highlighter
affixed to its rating by Standard & Poor's, and its terms must
have a predetermined fixed dollar amount of principal due at
maturity that cannot very or change. Interest may either by
fixed or variable. If such interest is variable, interest must
be tied to a single interest rate index plus a single fixed
spread (if any), and move proportionately with that index.
(iii) certificates of deposit, time deposits, demand deposits and
bankers' acceptances of any bank or trust company organized
under the laws of the United States or any state thereof
(having original maturities of not more than 365 days), the
short term obligations of which are rated in one of the two
highest rating categories of each of Moody's and Standard &
Poor's or such lower rating as will not result in
qualification, downgrading or withdrawal of the ratings then
assigned to the Certificates, as evidenced in writing by the
Rating Agencies. In addition, any such item must not have an
"r" highlighter affixed to its rating by Standard & Poor's,
and its terms should have a predetermined fixed dollar amount
of principal due at maturity that cannot vary or change.
Interest may either be fixed or variable. If such interest is
variable, interest must be tied to a single interest rate
index plus a single fixed spread (if any), and move
proportionately with that index.
(iv) commercial paper (having original maturities of not more than
365 days) of any corporation incorporated under the laws of
the United States or any state thereof (or if not so
incorporated, the commercial paper is United States Dollar
denominated and amounts payable thereunder are not subject to
any withholding imposed by any non-United States jurisdiction)
which is rated in the highest rating category of each of
Moody's and Standard & Poor's or such lower rating as will not
result in qualification, downgrading or withdrawal of the
ratings then assigned to the Certificates, as evidenced in
writing by the Rating Agencies. The commercial paper should
not have an "r" highlighter affixed to its rating by Standard
& Poor's and by its terms must have a predetermined fixed
dollar amount of principal due at maturity that cannot vary or
change. Interest may either by fixed or variable. If such
interest is variable, interest must be
<PAGE>
33
tied to a single interest rate index plus a single fixed
spread (if any), and move proportionately with that index.
(v) units of money market funds rated in the highest rating
category of Moody's and AAAm or AAAm-G by Standard & Poor's
(or such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to the
Certificates, as evidenced in writing by the Rating Agencies)
and which seeks to maintain a constant net asset value;
(vi) any other obligation or security acceptable to each Rating
Agency, evidence of which acceptability shall be provided in
writing by each Rating Agency to the Master Servicer, the
Special Servicer and the Trustee;
provided that (1) no investment described hereunder shall evidence either the
right to receive (x) only interest with respect to such investment or (y) a
yield to maturity greater than 120% of the yield to maturity at par of the
underlying obligations; and (2) no investment described hereunder may be
purchased at a price greater than par if such investment may be prepaid or
called at a price less than its purchase price prior to stated maturity.
"Permitted Transferee": Any Transferee of a Residual Certificate
other than a Disqualified Organization or Non-United States Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"P&I Advance": As to any Mortgage Loan or REO Loan, any advance made
by the Master Servicer or the Trustee pursuant to Section 4.03(a) and (b).
"P&I Advance Date": The Business Day immediately preceding each
Distribution Date.
"Plurality Residual Certificateholder": As to any taxable year of
REMIC I, REMIC II or REMIC III, the Holder of Certificates entitled to the
largest percentage of the Voting Rights allocated to the related Class of
Residual Certificates.
"Prepayment Assumption": For purposes of determining the accrual of
original issue discount, market discount and premium, if any, on the
Certificates for federal income tax purposes, 0% CPR (within the meaning of the
Prospectus), except that it is assumed that each ARD Loan is repaid on its
Anticipated Repayment Date.
"Prepayment Interest Excess": With respect to any Mortgage Loan that
was subject to a Principal Prepayment in full or in part during any Collection
Period, which Principal
<PAGE>
34
Prepayment was applied to such Mortgage Loan following such Mortgage Loan's Due
Date in such Collection Period, the amount of interest (net of the related
Master Servicing Fee, Additional Servicing Fee and if applicable, the Additional
Interest) accrued on the amount of such Principal Prepayment during the period
from and after such Due Date, to the extent collected (exclusive of any related
Prepayment Premium or Yield Maintenance Charge actually collected).
"Prepayment Interest Shortfall": With respect to any Mortgage Loan
that was subject to a Principal Prepayment in full or in part during any
Collection Period, which Principal Prepayment was applied to such Mortgage Loan
prior to such Mortgage Loan's Due Date in such Collection Period, the amount of
interest, to the extent not collected from the related Mortgagor (without regard
to any Prepayment Premium or Yield Maintenance Charge actually collected), that
would have accrued at a rate per annum equal to the sum of (x) the related Net
Mortgage Rate for such Mortgage Loan and (y) the Trustee Fee Rate, on the amount
of such Principal Prepayment during the period commencing on the date as of
which such Principal Prepayment was applied to such Mortgage Loan and ending on
the day immediately preceding such Due Date, inclusive.
"Prepayment Premium": Any premium, penalty or fee (other than a
Yield Maintenance Charge) paid or payable, as the context requires, by a
Mortgagor in connection with a Principal Prepayment.
"Prime Rate": The "prime rate" published in the "Money Rates"
section of The Wall Street Journal, as such "prime rate" may change from time to
time. If The Wall Street Journal ceases to publish the "prime rate", then the
Master Servicer shall select an equivalent publication that publishes such
"prime rate"; and if such "prime rate" is no longer generally published or is
limited, regulated or administered by a governmental or quasi-governmental body,
then the Master Servicer shall select a comparable interest rate index. In
either case, such selection shall be made by the Master Servicer in its sole
discretion and the Master Servicer shall notify the Trustee and the Special
Servicer in writing of its selection.
"Principal Distribution Amount": With respect to any Distribution
Date, the aggregate of the following:
(a) the aggregate of the principal portions of all Scheduled
Payments (other than Balloon Payments) and any Assumed Scheduled
Payments due or deemed due in respect of the Mortgage Loans for
their respective Due Dates occurring during the related Collection
Period, provided that for each Deemed Due Date Mortgage Loan, the
Scheduled Payment shall be deemed due on the first day of the month
in which a Due Date occurs or is deemed to occur for such Deemed Due
Date Mortgage Loan;
(b) the aggregate of all Principal Prepayments received on the
Mortgage Loans during the related Collection Period;
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35
(c) with respect to any Mortgage Loan as to which the related
Stated Maturity Date occurred during or prior to the related
Collection Period, any payment of principal (other than a Principal
Prepayment) made by or on behalf of the related Mortgagor during the
related Collection Period (including any Balloon Payment), net of
any portion of such payment that represents a recovery of the
principal portion of any Scheduled Payment (other than a Balloon
Payment) due, or the principal portion of any Assumed Scheduled
Payment deemed due, in respect of such Mortgage Loan on a Due Date
during or prior to the related Collection Period and not previously
recovered;
(d) the aggregate of all Liquidation Proceeds, Insurance
Proceeds and, to the extent not otherwise included in clause (a),
(b) or (c) above, payments that were received on the Mortgage Loans
during the related Collection Period and that were identified and
applied by the Master Servicer and/or Special Servicer as recoveries
of principal of such Mortgage Loans, in each case net of any portion
of such amounts that represents a recovery of the principal portion
of any Scheduled Payment (other than a Balloon Payment) due, or of
the principal portion of any Assumed Scheduled Payment deemed due,
in respect of the related Mortgage Loan on a Due Date during or
prior to the related Collection Period and not previously recovered;
(e) with respect to any REO Properties, the aggregate of the
principal portions of all Assumed Scheduled Payments deemed due in
respect of the related REO Loans for their respective Due Dates
occurring during the related Collection Period;
(f) with respect to any REO Properties, the aggregate of all
Liquidation Proceeds, Insurance Proceeds and REO Revenues that were
received during the related Collection Period on such REO Properties
and that were identified and applied by the Master Servicer and/or
Special Servicer as recoveries of principal of the related REO
Loans, in each case net of any portion of such amounts that
represents a recovery of the principal portion of any Scheduled
Payment (other than a Balloon Payment) due, or of the principal
portion of any Assumed Scheduled Payment deemed due, in respect of
the related REO Loan or the predecessor Mortgage Loan on a Due Date
during or prior to the related Collection Period and not previously
recovered; and
(g) if such Distribution Date is subsequent to the initial
Distribution Date, the excess, if any, of the Principal Distribution
Amount for the immediately preceding Distribution Date, over the
aggregate distributions of principal made on the Certificates on
such immediately preceding Distribution Date pursuant to Section
4.01.
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36
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan that is received in advance of its scheduled Due
Date; and provided that it shall not include a payment of principal that is
accompanied by an amount of interest representing scheduled interest due on any
date or dates in any month or months subsequent to the month of prepayment.
"Principal Recovery Fee": With respect to each Specially Serviced
Mortgage Loan, Corrected Mortgage Loan and REO Loan, the fee payable to the
Special Servicer out of certain related principal recoveries pursuant to the
second paragraph of Section 3.11(c).
"Privileged Person": Any Certificateholder, Certificate Owner, any
Person identified by any Certificateholder or Certificate Owner as a prospective
transferee of a Certificate or interest therein, any Rating Agency, any
Underwriter or any party hereto.
"Prospectus": The prospectus dated May 11, 1998, as supplemented by
the Prospectus Supplement, relating to the Registered Certificates.
"Prospectus Supplement": The prospectus supplement dated May 21,
1998 relating to the Registered Certificates.
"Purchase Price": With respect to any Mortgage Loan to be purchased
by a Mortgage Loan Seller pursuant to the related Mortgage Loan Purchase
Agreement, by the Majority Subordinate Certificateholder pursuant to Section
3.18(b), by the Master Servicer or the Special Servicer pursuant to Section
3.18(c) or by the Depositor, the Special Servicer, Lehman Brothers Inc. or the
Majority Subordinate Certificateholder or the Master Servicer pursuant to
Section 9.01 or to be otherwise sold pursuant to Section 3.18(d), a cash price
equal to the outstanding principal balance of such Mortgage Loan as of the date
of purchase, together with (a) all accrued and unpaid interest on such Mortgage
Loan at the related Mortgage Rate to but not including the Due Date in the
Collection Period of purchase plus any accrued interest on P&I Advances, (b) all
related and unreimbursed Servicing Advances plus any accrued interest thereon,
(c) any reasonable costs and expenses incurred by the Master Servicer or the
Trust Fund in connection with any such purchase by a Mortgage Loan Seller (to
the extent not included in clause (b) above) and (d) any other Additional Trust
Fund Expenses in respect of such Mortgage Loan (except that Additional Trust
Fund Expenses in respect of such Mortgage Loan allocable to any Class of
Certificates owned by the Majority Subordinate Certificateholder shall not be
included in the Purchase Price with respect to a purchase made by the Majority
Subordinate Certificateholder pursuant to Section 3.18(b)); provided, that the
Purchase Price shall not be reduced by any outstanding P&I Advance.
"Qualified Insurer": An insurance company or security or bonding
company qualified to write the related Insurance Policy in the relevant
jurisdiction.
"Rated Final Distribution Date": November 18, 2035.
"Rating Agency": Each of Moody's and Standard & Poor's.
<PAGE>
37
"Realized Loss": With respect to: (1) each defaulted Mortgage Loan
as to which a Final Recovery Determination has been made, or with respect to any
successor REO Loan as to which a Final Recovery Determination has been made as
to the related REO Property, an amount (not less than zero) equal to (a) the
unpaid principal balance of such Mortgage Loan or REO Loan, as the case may be,
as of the commencement of the Collection Period in which the Final Recovery
Determination was made, plus (b) without taking into account the amount
described in subclause (1)(d) of this definition, all accrued but unpaid
interest on such Mortgage Loan or such REO Loan, as the case may be, at the
related Mortgage Rate to but not including the Due Date in the Collection Period
in which the Final Recovery Determination was made (exclusive of any portion
thereof that constitutes Additional Interest), plus (c) any related unreimbursed
Servicing Advances as of the commencement of the Collection Period in which the
Final Recovery Determination was made, together with any new related Servicing
Advances made during such Collection Period, minus (d) all payments and
proceeds, if any, received in respect of such Mortgage Loan or the REO Property
that relates to such REO Loan, as the case may be, during the Collection Period
in which such Final Recovery Determination was made; (2) each defaulted Mortgage
Loan as to which any portion of the principal or previously accrued interest
(other than Additional Interest and Penalty Interest) payable thereunder was
canceled in connection with a bankruptcy or similar proceeding involving the
related Mortgagor or a modification, waiver or amendment of such Mortgage Loan
granted or agreed to by the Special Servicer pursuant to Section 3.20, the
amount of such principal and/or interest so canceled; and (3) each Mortgage Loan
as to which the Mortgage Rate thereon has been permanently reduced and not
recaptured for any period in connection with a bankruptcy or similar proceeding
involving the related Mortgagor or a modification, waiver or amendment of such
Mortgage Loan granted or agreed to by the Special Servicer pursuant to Section
3.20, the amount of the consequent reduction in the interest portion of each
successive Monthly Payment due thereon (each such Realized Loss shall be deemed
to have been incurred on the Due Date for each affected Monthly Payment).
"Record Date": With respect to any Distribution Date, the last
Business Day of the month immediately preceding the month in which such
Distribution Date occurs.
"Registered Certificate": Any Class A-1, Class A-2, Class B, Class
C, Class D, Class E or Class IO Certificate.
"Regular Certificate": Any REMIC III Certificate other than a Class
R-III Certificate.
"Reimbursement Rate": The rate per annum applicable to the accrual
of interest on Servicing Advances in accordance with Section 3.03(d) and on P&I
Advances in accordance with Section 4.03(d), which rate per annum is equal to
the Prime Rate.
"REMIC": A "real estate mortgage investment conduit" as defined in
Section 860D of the Code.
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38
"REMIC Administrator": The Trustee or any REMIC administrator
appointed pursuant to Section 8.14.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Sections
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and proposed, temporary and final Treasury regulations and any
published rulings, notices and announcements promulgated thereunder, as the
foregoing may be in effect from time to time.
"REMIC I": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder
with respect to which a separate REMIC election is to be made and, consisting
of: (i) the Mortgage Loans as from time to time are subject to this Agreement
and all payments under and proceeds of such Mortgage Loans received after the
Closing Date (excluding (a) all Additional Interest, and (b) any interest (other
than Penalty Interest) or principal payable on the Mortgage Loans which is
attributable to any portion of a Servicing Fee or Principal Recovery Fee that is
deemed to be in excess of the amount of such Servicing Fee or Principal Recovery
Fee that constitutes reasonable servicing compensation within the meaning of the
REMIC Provisions), together with all documents included in the related Mortgage
Files and any Escrow Payments and Reserve Funds; (ii) any REO Property acquired
in respect of a Mortgage Loan; (iii) such funds or assets (other than Additional
Interest) as from time to time are deposited in the Certificate Account, the
Distribution Account, the Interest Reserve Account and, if established, the REO
Account; and (iv) the rights of the Depositor under Sections 2, 3, 9, 10, 12,
13, 14, 15, 16 and 17 of each of the Mortgage Loan Purchase Agreements.
"REMIC I Regular Interest": Any of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
"regular interest" in REMIC I, as described in the Preliminary Statement hereto.
"REMIC I Remittance Rate": With respect to any REMIC I Regular
Interest for any Distribution Date, either: (1) if, in accordance with its terms
in effect on the Closing Date, the related Mortgage Loan accrues interest on a
30/360 Basis, the Net Mortgage Rate in effect for the related Mortgage Loan as
of the Closing Date; or (2) if, in accordance with its terms in effect on the
Closing Date, the related Mortgage Loan accrues interest on an Actual/360 Basis
(or any other interest accrual basis besides a 30/360 Basis), a rate per annum
equal to (a) a fraction (expressed as a percentage and rounded to the sixth
decimal place), the numerator of which is the product of 12 times the aggregate
amount of interest that would accrue during the calendar month preceding the
month in which such Distribution Date occurs on the Uncertificated Principal
Balance of such REMIC I Regular Interest outstanding immediately prior to such
Distribution Date if such interest were calculated (A) at the Mortgage Rate in
effect for the related Mortgage Loan as of the Closing Date and (B) on an
Actual/360 Basis (or on such other basis, besides a 30/360 Basis, that was
applicable to the accrual of interest on the related Mortgage Loan as of the
Closing Date), and the denominator of which is the Uncertificated Principal
Balance of such REMIC I Regular Interest
<PAGE>
39
immediately prior to such Distribution Date, minus (b) the sum of (i) the Master
Servicing Fee Rate for the related Mortgage Loan, (ii) the Trustee Fee Rate and
(iii) the Additional Servicing Fee Rate; provided that, in the case of an
Interest Reserve Loan, the amount of the numerator for the fraction described in
clause (2)(a) above shall (x) for the Distribution Date that occurs during
February of each year or during January of each year that is not a leap year, be
reduced by the related Interest Reserve Amount that is to be transferred from
the Certificate Account to the Interest Reserve Account on such Distribution
Date and (y) for the Distribution Date that occurs during March of each year, be
increased by the aggregate amount of any related Interest Reserve Amounts to be
included in the Available Distribution Amount for such Distribution Date.
"REMIC II": The segregated pool of assets consisting of all of the
REMIC I Regular Interests conveyed in trust to the Trustee for the benefit of
REMIC III, as holder of the REMIC II Regular Interests, and the Holders of the
Class R-II Certificates pursuant to Section 2.06, with respect to which a
separate REMIC election is to be made.
"REMIC II Regular Interest": Any of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
"regular interest" in REMIC II. Each REMIC II Regular Interest shall accrue
interest at the REMIC II Remittance Rate in effect from time to time, and shall
be entitled to distributions of principal, subject to the terms and conditions
hereof, in an aggregate amount equal to its initial Uncertificated Principal
Balance as set forth in the Preliminary Statement hereto. The designations for
the respective REMIC II Regular Interests are set forth in the Preliminary
Statement hereto.
"REMIC II Remittance Rate": With respect to each REMIC II Regular
Interest for any Distribution Date, the Weighted Average REMIC I Remittance Rate
for such Distribution Date.
"REMIC III": The segregated pool of assets consisting of all of the
REMIC II Regular Interests conveyed in trust to the Trustee for the benefit of
the Holders of the REMIC III Certificates pursuant to Section 2.08, with respect
to which a separate REMIC election is to be made.
"REMIC III Certificate": Any Class A-1, Class A-2, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class IO, Class J, Class K, Class
L, Class M, Class N or Class R-III Certificate.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code.
"REO Account": A segregated account or accounts created and
maintained by the Special Servicer pursuant to Section 3.16 on behalf of the
Trustee in trust for the Certificateholders, which shall be entitled "CRIIMI MAE
Services Limited Partnership, as Special Servicer, in trust for registered
holders of First Union-Lehman Brothers-Bank of
<PAGE>
40
America Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 1998-C2".
"REO Acquisition": The acquisition of any REO Property pursuant to
Section 3.09.
"REO Disposition": The sale or other disposition of any REO Property
pursuant to Section 3.18(d).
"REO Extension": As defined in Section 3.16(a).
"REO Loan": The mortgage loan deemed for purposes hereof to be
outstanding with respect to each REO Property. Each REO Loan shall be deemed to
provide for monthly payments of principal and/or interest equal to its Assumed
Scheduled Payment and otherwise to have the same terms and conditions as its
predecessor Mortgage Loan (such terms and conditions to be applied without
regard to the default on such predecessor Mortgage Loan and the acquisition of
the related REO Property as part of the Trust Fund). Each REO Loan shall be
deemed to have an initial unpaid principal balance and Stated Principal Balance
equal to the unpaid principal balance and Stated Principal Balance,
respectively, of its predecessor Mortgage Loan as of the date of the related REO
Acquisition. All Scheduled Payments (other than a Balloon Payment), Assumed
Scheduled Payments (in the case of a Balloon Mortgage Loan delinquent in respect
of its Balloon Payment) and other amounts due and owing, or deemed to be due and
owing, in respect of the predecessor Mortgage Loan as of the date of the related
REO Acquisition, shall be deemed to continue to be due and owing in respect of
an REO Loan. Collections in respect of each REO Loan (after provision for
amounts to be applied to the payment of, or to be reimbursed to the Master
Servicer, the Special Servicer, or the Trustee for the payment of, the costs of
operating, managing and maintaining the related REO Property or for the
reimbursement of the Master Servicer, the Special Servicer, or the Trustee for
other related Servicing Advances) shall be treated: first, as a recovery of
accrued and unpaid interest on such REO Loan at the related Mortgage Rate to but
not including the Due Date in the Collection Period of receipt (exclusive of any
portion thereof that constitutes Additional Interest); second, as a recovery of
principal of such REO Loan to the extent of its entire unpaid principal balance;
and third, in accordance with the normal servicing practices of the Master
Servicer, as a recovery of any other amounts due and owing in respect of such
REO Loan. Notwithstanding the foregoing, all amounts payable or reimbursable to
the Master Servicer, the Special Servicer or the Trustee in respect of the
predecessor Mortgage Loan as of the date of the related REO Acquisition,
including, without limitation, any unpaid Servicing Fees and any unreimbursed
Servicing Advances and P&I Advances, together with any interest accrued and
payable to the Master Servicer, the Special Servicer or the Trustee in respect
of such Servicing Advances and P&I Advances in accordance with Sections 3.03(d)
and 4.03(d), shall continue to be payable or reimbursable to the Master
Servicer, the Special Servicer or the Trustee, as the case may be, in respect of
an REO Loan pursuant to Section 3.05(a).
<PAGE>
41
"REO Property": A Mortgaged Property acquired on behalf and in the
name of the Trustee for the benefit of the Certificateholders through
foreclosure, acceptance of a deed-in-lieu of foreclosure or otherwise in
accordance with applicable law in connection with the default or imminent
default of a Mortgage Loan.
"REO Revenues": All income, rents, profits and proceeds derived from
the ownership, operation or leasing of any REO Property.
"REO Status Report": A report substantially containing the
information described in Exhibit O attached hereto, and setting forth with
respect to each REO Property that was included in the Trust Fund as of the close
of business on the Determination Date immediately preceding the preparation of
such report, among other things, (i) the acquisition date of such REO Property,
(ii) the amount of income collected with respect to such REO Property (net of
related expenses) and other amounts, if any, received on such REO Property
during the related Collection Period and (iii) the value of the REO Property
based on the most recent appraisal or other valuation thereof available to the
Special Servicer as of such Determination Date (including any prepared
internally by the Special Servicer).
"REO Tax": As defined in Section 3.17(a).
"Request for Release": A request signed by a Servicing Officer, as
applicable, of the Master Servicer in the form of Exhibit D-1 attached hereto or
of the Special Servicer in the form of Exhibit D-2 attached hereto.
"Required Appraisal": With respect to each Required Appraisal
Mortgage Loan, an appraisal of the related Mortgaged Property from an
Independent Appraiser selected by the Special Servicer, prepared in accordance
with 12 CFR ss.225.62 and conducted in accordance with the standards of the
Appraisal Institute.
"Required Appraisal Mortgage Loan": Each Mortgage Loan (i) that is
sixty (60) days or more delinquent in respect of any Monthly Payments, (ii) that
becomes an REO Loan, (iii) that has been modified by the Special Servicer to
reduce the amount of any Monthly Payment (other than a Balloon Payment), (iv)
with respect to which a receiver in bankruptcy is appointed and continues in
such capacity in respect of the related Mortgaged Property, (v) with respect to
which the related Mortgagor is subject to a bankruptcy proceeding or (vi) with
respect to which any Balloon Payment on such Mortgage Loan has not been paid by
its scheduled maturity date. Any Required Appraisal Mortgage Loan shall cease to
be such at such time as it has become a Corrected Mortgage Loan.
"Required Appraisal Value": An amount equal to 90% of the Appraised
Value (net of any prior liens and estimated liquidation expenses) of the
Mortgaged Property related to the subject Required Appraisal Mortgage Loan as
determined by a Required Appraisal or any letter update of such Required
Appraisal; and provided further that for purposes of determining any Appraisal
Reduction Amount in respect of such Required Appraisal Mortgage Loan, such
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Appraisal Reduction Amount shall be amended annually to reflect the Required
Appraisal Value determined pursuant to any Required Appraisal or letter update
of a Required Appraisal conducted subsequent to the original Required Appraisal
performed pursuant to Section 3.09(a).
"Reserve Account": The account or accounts created and maintained
pursuant to Section 3.03(f).
"Reserve Funds": With respect to any Mortgage Loan, any amounts
delivered by the related Mortgagor to be held in escrow by or on behalf of the
mortgagee representing reserves for environmental remediation, repairs and/or
capital improvements to the related Mortgaged Property.
"Residual Certificate": A Class R-I, Class R-II or Class R-III
Certificate.
"Responsible Officer": When used with respect to (i) the initial
Trustee any officer or assistant officer in the Corporate Trust Services Group
of the initial Trustee and (ii) any successor Trustee, any officer or assistant
officer in the Corporate Trust Department of the Trustee, or any other officer
or assistant officer of the Trustee customarily performing functions similar to
those performed by any of the above designated officers to whom a particular
matter is referred by the Trustee because of such officer's knowledge of and
familiarity with the particular subject.
"Restricted Servicer Reports": Each of the Watch List, Operating
Statement Analysis, NOI Adjustment Worksheet and Comparative Financial Status
Report.
"Scheduled Payment": With respect to any Mortgage Loan, for any Due
Date following the Cut-off Date as of which it is outstanding, the scheduled
monthly payment of principal and interest (other than Additional Interest) on
such Mortgage Loan that is or would be, as the case may be, payable by the
related Mortgagor on such Due Date under the terms of the related Mortgage Note
as in effect on the Closing Date, without regard to any subsequent change in or
modification of such terms in connection with a bankruptcy or similar proceeding
involving the related Mortgagor or a modification, waiver or amendment of such
Mortgage Loan granted or agreed to by the Special Servicer pursuant to Section
3.20, and assuming that each prior Scheduled Payment has been made in a timely
manner.
"Securities Act": The Securities Act of 1933, as amended.
"Senior Certificate": Any Class A-1, Class A-2 or Class IO
Certificate.
"Sequential Pay Certificates": Any of the Regular Certificates other
than the Class IO Certificates.
"Servicing Account": The account or accounts created and maintained
pursuant to Section 3.03(a).
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43
"Servicing Advances": All customary, reasonable and necessary "out
of pocket" costs and expenses incurred by or on behalf of the Master Servicer,
Special Servicer or the Trustee in connection with the servicing of a Mortgage
Loan, or in connection with the administration of any REO Property, including,
but not limited to, the cost of (a) compliance with the obligations of the
Master Servicer and the Special Servicer, if any, set forth in Section 3.03(c),
(b) the preservation, insurance, restoration, protection and management of a
Mortgaged Property, including the cost of any "forced placed" insurance policy
purchased by the Master Servicer to the extent such cost is allocable to a
particular Mortgaged Property that the Master Servicer or the Special Servicer
is required to cause to be insured pursuant to Section 3.07(a), (c) obtaining
any Insurance Proceeds or any Liquidation Proceeds of the nature described in
clauses (i)-(v) of the definition of "Liquidation Proceeds," (d) any enforcement
or judicial proceedings with respect to a Mortgaged Property, including, without
limitation, foreclosures, (e) any Required Appraisal or other appraisal
expressly required or permitted to be obtained hereunder, (f) the operation,
management, maintenance and liquidation of any REO Property, including, without
limitation, appraisals and (g) compliance with the obligations of the Master
Servicer or the Trustee set forth in Section 2.03(a). Notwithstanding anything
to the contrary, "Servicing Advances" shall not include allocable overhead of
the Master Servicer or the Special Servicer, such as costs for office space,
office equipment, supplies and related expenses, employee salaries and related
expenses and similar internal costs and expenses or costs and expenses incurred
by any such party in connection with its purchase of a Mortgage Loan or REO
Property.
"Servicing Fees": With respect to each Mortgage Loan and REO Loan,
the Master Servicing Fee, the Special Servicing Fee and Additional Servicing
Fee.
"Servicing File": Any documents (other than documents required to be
part of the related Mortgage File) relating to the origination and servicing of
any Mortgage Loan, including appraisals, surveys, engineering reports and
environmental reports.
"Servicing Officer": Any officer or employee of the Master Servicer
or the Special Servicer involved in, or responsible for, the administration and
servicing of the Mortgage Loans, whose name and specimen signature appear on a
list of servicing officers furnished by such party to the Trustee and the
Depositor on the Closing Date, as such list may be amended from time to time.
"Servicing Standard": With respect to the Master Servicer or the
Special Servicer, the servicing and administration of the Mortgage Loans for
which it is responsible hereunder (a) in the same manner in which, and with the
same care, skill, prudence and diligence with which, the Master Servicer or the
Special Servicer, as the case may be, generally services and administers similar
mortgage loans with similar borrowers (i) for other third-parties, giving due
consideration to customary and usual standards of practice of prudent
institutional commercial mortgage lenders servicing their own loans or (ii) held
in its own portfolio, whichever standard is higher, (b) with a view to the
maximization of the recovery on such Mortgage Loan on a net present value basis,
and (c) without regard to (i) any relationship
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44
that the Master Servicer or the Special Servicer, as the case may be, or any
Affiliate thereof may have with the related Mortgagor, the Depositor, any
Mortgage Loan Seller or any other party to the transaction; (ii) the ownership
of any Certificate by the Master Servicer or the Special Servicer, as the case
may be, or by any Affiliate thereof; (iii) the right of the Master Servicer or
the Special Servicer, as the case may be, to receive compensation or other fees
for its services rendered pursuant to this Agreement; (iv) the obligations of
the Master Servicer or the Special Servicer, as the case may be, to make
Advances; and (v) the ownership, servicing or management for others of any other
mortgage loans or mortgaged property.
"Servicing Transfer Event": With respect to any Mortgage Loan, the
occurrence of any of the events described in clauses (a) through (g) of the
definition of "Specially Serviced Mortgage Loan".
"Single Certificate": For purposes of Section 4.02, a hypothetical
Certificate of any Class of Regular Certificates evidencing a $1,000
denomination.
"Spa Business Center Loan": The Mortgage Loan with control number
560.
"Special Servicer": CRIIMI MAE Services Limited Partnership, its
successor in interest, or any successor special servicer appointed as herein
provided.
"Special Servicing Fee": With respect to each Specially Serviced
Mortgage Loan and each REO Loan, the fee designated as such and payable to the
Special Servicer pursuant to the first paragraph of Section 3.11(c).
"Special Servicing Fee Rate": With respect to each Specially
Serviced Mortgage Loan and each REO Loan, 0.25% per annum.
"Specially Serviced Mortgage Loan": Any Mortgage Loan as to which
any of the following events have occurred:
(a) the related Mortgagor shall have failed to make any Monthly
Payment, and such failure has continued unremedied for 45 days
(or, in the case of a Balloon Payment, if the Master Servicer
receives written evidence from an institutional lender of such
lender's binding commitment to refinance such Mortgage Loan
and the related Mortgagor continues to make monthly payments
of principal and interest in an amount at least equal to the
Monthly Payment due on the Due Date immediately preceding the
scheduled maturity date, such longer period (not to exceed 120
days) within which such refinancing is expected to occur); or
(b) the Master Servicer shall have determined, in its good faith
reasonable judgment, based on communications with the related
Mortgagor, that a default in making a Monthly Payment is
likely to occur within 30 days and is likely to remain
unremedied for at least 60 days (or, in the case of
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45
a Balloon Payment, if the Master Servicer has received written
evidence from an institutional lender of such lender's binding
commitment to refinance such Mortgage Loan and if the Master
Servicer reasonably expects the related Mortgagor to continue
to make monthly payments of principal and interest in an
amount at least equal to the Monthly Payment due on the Due
Date immediately preceding the scheduled maturity date, such
longer period (not to exceed 120 days) within which such
refinancing is expected to occur); or
(c) there shall have occurred, or the Master Servicer and the
Special Servicer determines there is likely to occur within 10
days, a default (other than as described in clause (a) above)
that materially impairs the value of the Mortgaged Property as
security for the Mortgage Loan or otherwise materially
adversely affects the interests of Certificateholders and that
continues unremedied for the applicable grace period under the
terms of the Mortgage Loan (or, if no grace period is
specified, for 30 days); or
(d) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an
involuntary case under any present or future federal or state
bankruptcy, insolvency or similar law or the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of
its affairs, shall have been entered against the related
Mortgagor and such decree or order shall have remained in
force undischarged or unstayed for a period of 60 days; or
(e) the related Mortgagor shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities or
similar proceedings of or relating to such Mortgagor or of or
relating to all or substantially all of its property; or
(f) the related Mortgagor shall admit in writing its inability to
pay its debts generally as they become due, file a petition to
take advantage of any applicable insolvency or reorganization
statute, make an assignment for the benefit of its creditors,
or voluntarily suspend payment of its obligations; or
(g) the Master Servicer shall have received notice of the
commencement of foreclosure or similar proceedings with
respect to the related Mortgaged Property;
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46
provided, however, that a Mortgage Loan will cease to be a Specially Serviced
Mortgage Loan:
(w) with respect to the circumstances described in clause (a)
above, when the related Mortgagor has made three consecutive
full and timely Monthly Payments under the terms of such
Mortgage Loan (as such terms may be changed or modified in
connection with a bankruptcy or similar proceeding involving
the related Mortgagor or by reason of a modification, waiver
or amendment granted or agreed to by the Special Servicer
pursuant to Section 3.20);
(x) with respect to the circumstances described in clauses (b),
(d), (e) and (f) above, when such circumstances cease to exist
in the good faith reasonable judgment of the Special Servicer,
but, with respect to any bankruptcy or insolvency proceedings
described in clauses (d), (e) and (f), no later than the entry
of an order or decree dismissing such proceeding;
(y) with respect to the circumstances described in clause (c)
above, when such default is cured; and
(z) with respect to the circumstances described in clause (g)
above, when such proceedings are terminated;
so long as at that time no circumstance identified in clauses (a) through (g)
above exists that would cause the Mortgage Loan to continue to be characterized
as a Specially Serviced Mortgage Loan.
"Standard & Poor's": Standard & Poor's Ratings Services, a division
of The McGraw-Hill Companies, Inc., or its successor in interest. If neither
such rating agency nor any successor remains in existence, "Standard & Poor's"
shall be deemed to refer to such other nationally recognized statistical rating
agency or other comparable Person designated by the Depositor, notice of which
designation shall be given in writing to the Trustee, the Master Servicer and
the Special Servicer, and specific ratings of Standard & Poor's Ratings Services
herein referenced shall be deemed to refer to the equivalent ratings of the
party so designated.
"Startup Day": With respect to each of REMIC I, REMIC II and REMIC
III, the day designated as such in Section 10.01(c).
"State and Local Taxes": Taxes imposed by the states of New York,
Illinois, Delaware, Maryland and North Carolina and by any other state or local
taxing authorities as may, by notice to the Trustee, assert jurisdiction over
the trust fund or any portion thereof, or which, according to an Opinion of
Counsel addressed to the Trustee, have such jurisdiction.
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47
"Stated Maturity Date": With respect to any Mortgage Loan, the Due
Date specified in the Mortgage Note (as in effect on the Closing Date) on which
the last payment of principal is due and payable under the terms of the Mortgage
Note (as in effect on the Closing Date), without regard to any change in or
modification of such terms in connection with a bankruptcy or similar proceeding
involving the related Mortgagor or a modification, waiver or amendment of such
Mortgage Loan granted or agreed to by the Special Servicer pursuant to Section
3.20 and, in the case of an ARD Loan, without regard to its Anticipated
Repayment Date.
"Stated Principal Balance": With respect to any Mortgage Loan (and
any successor REO Loan), the Cut-off Date Balance of such Mortgage Loan, as
permanently reduced on each Distribution Date (to not less than zero) by (i) all
payments (or advances in lieu thereof) and other collections of principal of
such Mortgage Loan (or successor REO Loan) that are distributed (or, to the
extent they had not been applied to cover Additional Trust Fund Expenses, would
have been distributed) to Certificateholders on such Distribution Date, and (ii)
the principal portion of any Realized Loss incurred in respect of such Mortgage
Loan (or successor or REO Loan) during the related Collection Period.
Notwithstanding the foregoing, if a Liquidation Event occurs in respect of any
Mortgage Loan or REO Property, then the "Stated Principal Balance" of such
Mortgage Loan or of the related REO Loan, as the case may be, shall be zero
commencing as of the Distribution Date in the Collection Period next following
the Collection Period in which such Liquidation Event occurred.
"Subordinated Certificate": Any Class B, Class C, Class D, Class E,
Class F, Class G, Class H, Class J, Class K, Class L, Class M, Class N, Class
R-I, Class R-II or Class R-III Certificate.
"Sub-Servicer": Any Person with which the Master Servicer or the
Special Servicer has entered into a Sub-Servicing Agreement.
"Sub-Servicing Agreement": The written contract between the Master
Servicer or the Special Servicer, on the one hand, and any Sub-Servicer, on the
other hand, relating to servicing and administration of Mortgage Loans as
provided in Section 3.22.
"Tax Matters Person": With respect to each of the REMICs created
hereunder, the Person designated as the "tax matters person" of such REMIC in
the manner provided under Treasury Regulations Section 1.860F-4(d) and Temporary
Treasury Regulations Section 301.6231(a)(7)-1T, which Person shall be the
applicable Plurality Residual Certificateholder.
"Tax Returns": The federal income tax return on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any successor forms,
to be filed on behalf of each of REMIC I, REMIC II and REMIC III due to its
classification as a REMIC under the REMIC Provisions, and the federal income tax
return to be filed on behalf of the Grantor Trust due to its classification
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48
as a grantor trust under the Grantor Trust Provisions, together with any and all
other information, reports or returns that may be required to be furnished to
the Certificateholders or filed with the Internal Revenue Service under any
applicable provisions of federal tax law or any other governmental taxing
authority under applicable State and Local Tax laws.
"Tenant": With respect to each Credit Lease, the lessee thereunder.
"Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment of any Ownership Interest in a
Certificate.
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer any Ownership
Interest in a Certificate.
"Trust Fund": Collectively, (i) all of the assets of REMIC I, REMIC
II and REMIC III, (ii) any interest payable on the Mortgage Loans which is
attributable to any portion of a Servicing Fee or Principal Recovery Fee that is
deemed to be in excess of the amount of such Servicing Fee or Principal Recovery
Fee that constitutes reasonable servicing compensation within the meaning of the
REMIC Provisions, and (iii) the Grantor Trust Assets.
"Trustee": NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, its
successor in interest, or any successor trustee appointed as herein provided.
"Trustee Fee" means, with respect to each Mortgage Loan and REO Loan
for any Distribution Date, an amount equal to one month's interest for the most
recently ended calendar month (calculated on a 30/360 Basis), accrued at the
Trustee Fee Rate on the Stated Principal Balance of such Mortgage Loan or REO
Loan, as the case may be, outstanding immediately following the prior
Distribution Date (or, in the case of the initial Distribution Date, as of the
Closing Date).
"Trustee Fee Rate": 0.0012% per annum.
"Trustee Liability": As defined in Section 8.05(b).
"UCC": The Uniform Commercial Code in effect in the applicable
jurisdiction.
"UCC Financing Statement": A financing statement executed and filed
pursuant to the Uniform Commercial Code, as in effect in any relevant
jurisdiction.
"Uncertificated Accrued Interest": With respect to any REMIC I
Regular Interest, for any Distribution Date, one month's interest at the REMIC I
Remittance Rate applicable to such REMIC I Regular Interest for such
Distribution Date, accrued on the Uncertificated Principal Balance of such REMIC
I Regular Interest outstanding immediately
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49
prior to such Distribution Date and, to the extent permitted under applicable
law, also on any Uncertificated Accrued Interest in respect of such REMIC I
Regular Interest from prior Distribution Dates that was not previously deemed
paid. With respect to any REMIC II Regular Interest, for any Distribution Date,
one month's interest at the REMIC II Remittance Rate, accrued on the
Uncertificated Principal Balance of such REMIC II Regular Interest outstanding
immediately prior to such Distribution Date. Uncertificated Accrued Interest in
respect of any REMIC I Regular Interest or any REMIC II Regular Interest shall
accrue on a 30/360 Basis and, with respect to any REMIC I Regular Interest or
REMIC II Regular Interest for any Distribution Date, shall be deemed to accrue
during the calendar month preceding the month in which such Distribution Date
occurs.
"Uncertificated Distributable Interest": With respect to any REMIC I
Regular Interest for any Distribution Date, the Uncertificated Accrued Interest
in respect of such REMIC I Regular Interest for such Distribution Date, reduced
(to not less than zero) by the product of (i) any Net Aggregate Prepayment
Interest Shortfall for such Distribution Date, multiplied by (ii) a fraction,
the numerator of which is the Uncertificated Accrued Interest in respect of such
REMIC I Regular Interest for such Distribution Date, and the denominator of
which is the aggregate Uncertificated Accrued Interest in respect of all the
REMIC I Regular Interests for such Distribution Date. With respect to any REMIC
II Regular Interest for any Distribution Date, the Uncertificated Accrued
Interest in respect of such REMIC II Regular Interest for such Distribution
Date, reduced (to not less than zero) by the product of (i) any Net Aggregate
Prepayment Interest Shortfall for such Distribution Date, multiplied by (ii) a
fraction, expressed as a percentage, the numerator of which is the
Uncertificated Accrued Interest in respect of such REMIC II Regular Interest for
such Distribution Date, and the denominator of which is the aggregate
Uncertificated Accrued Interest in respect of all the REMIC II Regular Interests
for such Distribution Date.
"Uncertificated Principal Balance": The principal amount of any
REMIC I Regular Interest or REMIC II Regular Interest outstanding as of any date
of determination. As of the Closing Date, the Uncertificated Principal Balance
of each REMIC I Regular Interest shall equal the Cut-off Date Balance of the
related Mortgage Loan, and the Uncertificated Principal Balance of each REMIC II
Regular Interest shall equal the Original Class Principal Balance of the
corresponding Class of Sequential Pay Certificates as set forth in the
Preliminary Statement hereto. On each Distribution Date, the Uncertificated
Principal Balance of each REMIC II Regular Interest shall be permanently reduced
by all distributions of principal deemed to have been made thereon on such
Distribution Date pursuant to Section 4.01(h), and shall be further permanently
reduced on such Distribution Date by all Realized Losses and Additional Trust
Fund Expenses deemed to have been allocated thereto on such Distribution Date
pursuant to Section 4.04(b). On each Distribution Date, the Uncertificated
Principal Balance of each REMIC I Regular Interest shall be permanently reduced
by all distributions of principal deemed to have been made in respect of such
REMIC I Regular Interest on such Distribution Date pursuant to Section 4.01(i),
and shall be further permanently reduced on such Distribution Date by all
Realized Losses and Additional Trust Fund Expenses deemed to have been allocated
thereto on such Distribution Date pursuant to Section 4.04(c).
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50
"Underwriter": Each of First Union Capital and Lehman Brothers Inc.
or, in each such case, its successor in interest.
"United States Person": A citizen or resident of the United States,
a corporation, partnership or other entity created or organized in, or under the
laws of, the United States or any political subdivision thereof, or an estate
whose income from sources without the United States is includible in gross
income for United States federal income tax purposes regardless of its
connection with the conduct of a trade or business within the United States, or
a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more United States
persons have the authority to control all substantial decisions of the trust,
all within the meaning of Section 7701(a) (30) of the Code.
"Unrestricted Servicer Reports": Each of the Delinquent Loan Status
Report, Historical Loan Modification Report, Historical Loan Estimate Report,
REO Status Report and Loan Payoff Notification Report.
"USAP": The Uniform Single Attestation Program for Mortgage Bankers.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. At all times during the term
of this Agreement, 100% of the Voting Rights shall be allocated among the
Holders of the Class A-1, Class A-2, Class B, Class C, Class D, Class E, Class
F, Class G, Class H, Class J, Class K, Class L, Class M and Class N Certificates
in proportion to the respective Class Principal Balances of their Certificates;
provided that, solely for the purpose of determining the Voting Rights of the
Classes of Sequential Pay Certificates, the aggregate Appraisal Reduction Amount
(determined as set forth herein) shall be treated as Realized Losses with
respect to the calculation of the Certificate Principal Balances thereof. Voting
Rights allocated to a Class of Certificateholders shall be allocated among such
Certificateholders in standard proportion to the Percentage Interests evidenced
by their respective Certificates. In addition, if either the Master Servicer or
the Special Servicer is the holder of any Certificate, neither of the Master
Servicer or Special Servicer, in its capacity as a Certificateholder, shall have
Voting Rights with respect to matters concerning compensation affecting the
Master Servicer or the Special Servicer.
"Watch List": As of each Determination Date a report, substantially
in the form of Exhibit P attached hereto, identifying each Mortgage Loan that is
not a Specially Serviced Mortgage Loan (i) with a Debt Service Coverage Ratio of
less than 1.05x, (ii) that has a Stated Maturity Date occurring in the next
sixty days, (iii) that is delinquent in respect of its real estate taxes, (iv)
for which any outstanding Advances exist, (v) that has been a Specially Serviced
Mortgage Loan in the past 90 days, (vi) for which the Debt Service Coverage
Ratio has decreased by more than 10% in the prior 12 months, (vii) for which any
lease relating to more than 25% of the related Mortgaged Property has expired,
been terminated, is in default or will expire within the next three months,
(viii) that is late in making its Monthly Payment
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51
three or more times in the preceding twelve months, (ix) with material deferred
maintenance at the related Mortgaged Property or (x) that is 30 or more days
delinquent.
"Weighted Average REMIC I Remittance Rate": With respect to any
Distribution Date, the rate per annum equal to the weighted average, expressed
as a percentage and rounded to six decimal places, of the respective REMIC I
Remittance Rates applicable to the REMIC I Regular Interests for such
Distribution Date, weighted on the basis of the respective Uncertificated
Principal Balances of such REMIC I Regular Interests outstanding immediately
prior to such Distribution Date.
"Yield Maintenance Charge": Payments paid or payable, as the context
requires, on a Mortgage Loan as the result of a Principal Prepayment thereon,
not otherwise due thereon in respect of principal or interest, which have been
calculated (based on Scheduled Payments on such Mortgage Loan) to compensate the
holder for reinvestment losses based on the value of an interest rate index at
or near the time of prepayment. Any other prepayment premiums, penalties and
fees not so calculated will not be considered "Yield Maintenance Charges." In
the event that a Yield Maintenance Charge shall become due for any particular
Mortgage Loan, the Master Servicer shall be required to follow the terms and
provisions contained in the applicable Mortgage Note, provided, however, in the
event the particular Mortgage Note shall not specify the U.S. Treasuries which
shall be used in determining the discount rate or the reinvestment yield to be
applied in such calculation, the Master Servicer shall be required to use those
U.S. Treasuries which shall generate the lowest discount rate or reinvestment
yield for the purposes thereof. Accordingly if either no U.S. Treasury issue, or
more than one U.S. Treasury issue, shall coincide with the term over which the
Yield Maintenance Charge shall be calculated (which depending on the applicable
Mortgage Note is based on the remaining average life of the Mortgage Loan or the
actual term remaining through the Maturity Date), the Master Servicer shall use
the U.S. Treasury whose reinvestment yield is the lowest, with such yield being
based on the bid price for such issue as published in the Wall Street Journal on
the date that is fourteen (14) days prior to the date that the Yield Maintenance
Charge shall become due and payable (or, if such bid price is not published on
that date, the next preceding date on which such bid price is so published) and
converted to a monthly compounded nominal yield. The monthly compounded nominal
yield ("MEY") is derived from the reinvestment yield or discount rate and shall
be defined as MEY = (12X [{(1+"BEY"/2)^1/6}-1]) X 100 where BEY is defined as
the U.S. Treasury Reinvestment Yield which is in decimal form and not in
percentage, and 1/6 is the exponential power to which a portion of the equation
is raised. For example, using a BEY of 5.50%, the MEY = (12 X [{(1+
.055/2)^0.16667-1}]) X 100 where .055 is the decimal version of the percentage
5.5% and 0.16667 is the decimal version of the exponential power. The MEY in the
above calculation is 5.438%.
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52
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES; ORIGINAL
ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery
hereof, does hereby assign, sell, transfer, set over and otherwise convey to the
Trustee, without recourse, for the benefit of the Certificateholders (and for
the benefit of the other parties to this Agreement as their respective interests
may appear) all the right, title and interest of the Depositor, in, to and under
(i) the Mortgage Loans, (ii) each of the Mortgage Loan Purchase Agreements and
(iii) all other assets included or to be included in the Trust Fund. Such
assignment includes all interest and principal received or receivable on or with
respect to the Mortgage Loans and due after the Cut-off Date. The transfer of
the Mortgage Loans and the related rights and property accomplished hereby is
absolute and, notwithstanding Section 11.07, is intended by the parties to
constitute a sale.
(b) In connection with the Depositor's assignment pursuant to
Section 2.01(a) above, the Depositor shall direct, and hereby represents and
warrants that it has directed, the Mortgage Loan Sellers, in each case pursuant
to the applicable Mortgage Loan Purchase Agreement, to deliver to and deposit
with, or cause to be delivered to and deposited with, the Trustee or a Custodian
appointed thereby (with a copy to the Master Servicer and the Special Servicer),
on or before the Closing Date, the Mortgage File for each Mortgage Loan so
assigned. None of the Trustee, any Custodian, the Master Servicer or the Special
Servicer shall be liable for any failure by any Mortgage Loan Seller or the
Depositor to comply with the document delivery requirements of the respective
Mortgage Loan Purchase Agreement and this Section 2.01 (b).
(c) The Master Servicer shall, at the Depositor's expense and
direction, as to each Mortgage Loan, promptly (and in any event within 45 days
following the later of the Closing Date or the delivery of such assignments and
UCC Financing Statements to the Master Servicer) cause to be submitted for
recording or filing, as the case may be, in the appropriate public office for
real property records or UCC Financing Statements, as appropriate and to the
extent timely delivered to the Master Servicer in final, recordable form, each
assignment of Mortgage, assignment of Assignment of Leases and any other
recordable documents relating to the Mortgage Loan, in favor of the Trustee
referred to in clause (iv) of the definition of "Mortgage File" and each UCC-2
and UCC-3 assignment in favor of the Trustee and so delivered to the Master
Servicer and referred to in clause (viii) of the definition of "Mortgage File."
Each such assignment, UCC-2 and UCC-3 shall reflect that it should be returned
by the public recording office to the Master Servicer or its designee following
recording, and each such UCC-2 and UCC-3 assignment shall reflect that the file
copy thereof should be returned to the Custodian or its designee following
filing; provided, that in those instances where the public recording office
retains the original assignment of Mortgage or assignment of
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Assignment of Leases, the Master Servicer shall obtain therefrom a certified
copy of the recorded original. If any such document or instrument is lost or
returned unrecorded or unfiled, as the case may be, because of a defect therein,
the Trustee shall direct the appropriate Mortgage Loan Seller pursuant to the
applicable Mortgage Loan Purchase Agreement promptly to prepare or cause to be
prepared a substitute therefor or cure such defect, as the case may be, and
thereafter the Master Servicer shall upon receipt thereof cause the same to be
duly recorded or filed, as appropriate.
(d) All documents and records in the possession of the Mortgage Loan
Sellers that relate to the Mortgage Loans and that are not required to be a part
of a Mortgage File in accordance with the definition thereof, together all
Escrow Payments and Reserve Accounts in the possession thereof, shall be
delivered to the Master Servicer or such other Person as may be directed by the
Master Servicer (at the expense of the applicable Mortgage Loan Seller) on or
before the Closing Date and shall be held by the Master Servicer on behalf of
the Trustee in trust for the benefit of the Certificateholders; provided,
however, the Master Servicer shall have no responsibility for holding documents
created or maintained by the Special Servicer hereunder and not delivered to the
Master Servicer.
(e) In connection with the Depositor's assignment pursuant to
Section 2.01(a) above, the Depositor shall deliver to the Custodian and the
Master Servicer on or before the Closing Date a copy of a fully executed
counterpart of each Mortgage Loan Purchase Agreement, as in full force and
effect on the Closing Date.
SECTION 2.02. Acceptance of the Trust Fund by Trustee.
(a) The Trustee, by its execution and delivery of this Agreement,
acknowledges receipt of the Depositor's assignment to it of the Depositor's
right, title and interest in the assets that constitute the Trust Fund, and
further acknowledges receipt by it or a Custodian on its behalf, subject to the
proviso in the definition of "Mortgage File" and the provisions of Section 2.01
and subject to the further review provided for in Section 2.02(b), of (i) the
Mortgage File delivered to it for each Mortgage Loan and (ii) a copy of a fully
executed counterpart of each Mortgage Loan Purchase Agreement, all in good faith
and without notice of any adverse claim, and declares that it or a Custodian on
its behalf holds and will hold such documents and the other documents received
by it that constitute portions of the Mortgage Files, and that it holds and will
hold the Mortgage Loans and other assets included in the Trust Fund, in trust
for the exclusive use and benefit of all present and future Certificateholders.
The Custodian hereby certifies to each of the Depositor, the Master Servicer,
the Special Servicer, the Trustee and the Mortgage Loan Sellers, that except as
identified in the Schedule of Exceptions, a form of which is attached hereto as
Exhibit C, a copy of which shall have been delivered by the Custodian on or
prior to the Closing Date to each of the Depositor, the Master Servicer, the
Special Servicer, the Trustee and the Mortgage Loan Sellers, without regard to
the proviso in the definition of "Mortgage File", each of the documents
specified in clause (i) of the definition of Mortgage File are in its
possession. In addition, within forty-five (45) Business Days after the Closing,
the Trustee or the Custodian on its behalf will review the
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Mortgage Files and certify to each of the Depositor, the Master Servicer, the
Special Servicer and the Mortgage Loan Sellers that, with respect to each
Mortgage Loan listed in the Mortgage Loan Schedule, except as specifically
identified in the Schedule of Exceptions to Mortgage File Delivery in
substantially the form annexed hereto as Exhibit C, (i) without regard to the
proviso in the definition of "Mortgage File," all documents specified in clauses
(i) through (v) and (vii), and to the extent provided in the related Mortgage
File and actually known by a Responsible Officer of the Trustee to be required,
clauses (vi) and (viii) of the definition of "Mortgage File" are in its
possession, (ii) all documents delivered or caused to be delivered by the
applicable Mortgage Loan Seller constituting the related Mortgage File have been
reviewed by it and appear regular on their face and appear to relate to such
Mortgage Loan, and (iii) based on such examination and only as to the foregoing
documents, the information set forth in the Mortgage Loan Schedule for such
Mortgage Loan with respect to the items specified in clauses (v) and (vi)(B) of
the definition of "Mortgage Loan Schedule" is correct. Notwithstanding the
above, the Custodian may deliver a revised Schedule of Exceptions to Mortgage
File Delivery to the Depositor within 45 Business Days after the Closing Date.
Such revised schedule shall be treated as if it was attached hereto as Exhibit
C.
(b) None of the Trustee, the Master Servicer, the Special Servicer
or any Custodian is under any duty or obligation to inspect, review or examine
any of the documents, instruments, certificates or other papers relating to the
Mortgage Loans delivered to it to determine that the same are valid, legal,
effective, genuine, enforceable, in recordable form, sufficient or appropriate
for the represented purpose or that they are other than what they purport to be
on their face.
SECTION 2.03. Mortgage Loan Seller's Repurchase of Mortgage
Loans for Document Defects and Breaches of
Representations and Warranties.
(a) If any party hereto discovers that any document or documents
constituting a part of a Mortgage File has not been properly executed, is
missing, contains information that does not conform in any material respect with
the corresponding information set forth in the Mortgage Loan Schedule, or does
not appear to be regular on its face (each, a "Document Defect"), or discovers
or receives notice of a breach of any representation or warranty relating to any
Mortgage Loan set forth in the applicable Mortgage Loan Purchase Agreement (a
"Breach"), and such Document Defect or Breach, as the case may be, materially
and adversely affects the interests of the Certificateholders or the value of
the affected Mortgage Loan, such party shall give prompt written notice to the
other parties hereto and to the Rating Agencies. Promptly upon becoming aware of
any such Document Defect or Breach (including through such written notice
provided by any party hereto, as provided above), the Master Servicer shall
request in writing that the related Mortgage Loan Seller cure such Document
Defect or Breach, as the case may be, or repurchase the affected Mortgage Loan
in accordance with Section 3(c) of the Mortgage Loan Purchase Agreement. For a
period of two years from the Closing Date, so long as there remains any Mortgage
File as to which there is any uncured Document Defect and so long as the related
Mortgage Loan Seller shall provide
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55
the Officer's Certificate pursuant to Section 3(c) of the related Mortgage Loan
Purchase Agreement, the Trustee shall on a quarterly basis prepare and deliver
to the other parties a written report as to the status of such uncured Document
Defects. If the affected Mortgage Loan is to be repurchased, the Master Servicer
shall designate the Certificate Account as the account to which funds in the
amount of the Purchase Price are to be wired. Any such repurchase of a Mortgage
Loan shall be on a whole loan, servicing released basis. Notwithstanding the
foregoing, the delivery of a commitment to issue a policy of lender's title
insurance in lieu of the delivery of the actual policy of lender's title
insurance shall not be considered a Document Defect with respect to any Mortgage
File if such actual policy of insurance is delivered to the Trustee or a
Custodian on its behalf not later than the 90th day following the Closing Date.
(b) In connection with any repurchase of a Mortgage Loan
contemplated by this Section 2.03, the Trustee, the Custodian, the Master
Servicer and the Special Servicer shall each tender to the appropriate Mortgage
Loan Seller, upon delivery to each of them of a receipt executed by such
Mortgage Loan Seller, all portions of the Mortgage File and other documents
pertaining to such Mortgage Loan possessed by it, and each document that
constitutes a part of the Mortgage File shall be endorsed or assigned to the
extent necessary or appropriate to such Mortgage Loan Seller or its designee in
the same manner, and pursuant to appropriate forms of assignment, substantially
similar to the manner and forms pursuant to which such documents were previously
assigned to the Trustee; provided, that such tender by the Trustee shall be
conditioned upon its receipt from the Master Servicer of a Request for Release.
The Master Servicer shall, and is hereby authorized and empowered by the Trustee
to, prepare, execute and deliver in its own name, on behalf of the
Certificateholders and the Trustee or any of them, the endorsements and
assignments contemplated by this Section 2.03, and the Trustee shall execute any
powers of attorney that are prepared and delivered to the Trustee by the Master
Servicer and are necessary to permit the Master Servicer to do so. The Master
Servicer shall indemnify the Trustee for any reasonable costs, fees, liabilities
and expenses incurred by the Trustee in connection with the negligent or willful
misuse by the Master Servicer of such powers of attorney.
(c) Each Mortgage Loan Purchase Agreement provides the sole remedies
available to the Certificateholders, or the Trustee on behalf of the
Certificateholders, respecting any Document Defect or Breach with respect to the
Mortgage Loans purchased by the Depositor thereunder.
SECTION 2.04. Representations and Warranties of Depositor.
(a) The Depositor hereby represents and warrants to the Trustee, for
its own benefit and the benefit of the Certificateholders, and to the Master
Servicer and the Special Servicer, as of the Closing Date, that:
(i) The Depositor is a corporation duly organized, validly
existing and in good standing under the laws of the State of North
Carolina.
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(ii) The execution and delivery of this Agreement by the
Depositor, and the performance and compliance with the terms of this
Agreement by the Depositor, will not violate the Depositor's
certificate of incorporation or bylaws or constitute a default (or
an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in the breach of, any
material agreement or other instrument to which it is a party or
which is applicable to it or any of its assets.
(iii) The Depositor has the full power and authority to enter
into and consummate all transactions contemplated by this Agreement,
has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid,
legal and binding obligation of the Depositor, enforceable against
the Depositor in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, reorganization, moratorium and
other laws affecting the enforcement of creditors' rights generally,
and (B) general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
(v) The Depositor is not in violation of, and its execution
and delivery of this Agreement and its performance and compliance
with the terms of this Agreement will not constitute a violation of,
any law, any order or decree of any court or arbiter, or any order,
regulation or demand of any federal, state or local governmental or
regulatory authority, which violation, in the Depositor's good faith
and reasonable judgment, is likely to affect materially and
adversely either the ability of the Depositor to perform its
obligations under this Agreement or the financial condition of the
Depositor.
(vi) The transfer of the Mortgage Loans to the Trustee as
contemplated herein requires no regulatory approval, other than any
such approvals as have been obtained, and is not subject to any bulk
transfer or similar law in effect in any applicable jurisdiction.
(vii) No litigation is pending or, to the best of the
Depositor's knowledge, threatened against the Depositor that, if
determined adversely to the Depositor, would prohibit the Depositor
from entering into this Agreement or that, in the Depositor's good
faith and reasonable judgment, is likely to materially and adversely
affect either the ability of the Depositor to perform its
obligations under this Agreement or the financial condition of the
Depositor.
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(viii) Immediately prior to the transfer of the Mortgage Loans
to the Trust Fund pursuant to this Agreement, (A) the Depositor had
good and marketable title to, and was the sole owner and holder of,
each Mortgage Loan; and (B) the Depositor has full right and
authority to sell, assign and transfer the Mortgage Loans and all
servicing rights pertaining thereto.
(ix) The Depositor is transferring the Mortgage Loans to the
Trust Fund free and clear of any liens, pledges, charges and
security interests.
(b) The representations and warranties of the Depositor set forth in
Section 2.04(a) shall survive the execution and delivery of this Agreement and
shall inure to the benefit of the Persons for whose benefit they were made for
so long as the Trust Fund remains in existence. Upon discovery by any party
hereto of any breach of any of the foregoing representations and warranties, the
party discovering such breach shall give prompt written notice thereof to the
other parties.
SECTION 2.05. Execution, Authentication and Delivery of Class
R-I Certificates; Creation of REMIC I Regular
Interests.
The Trustee hereby acknowledges the assignment to it of the assets
included in the Trust Fund. Concurrently with such assignment and in exchange
therefor, (a) the Trustee agrees to hold the portion of each of the Mortgage
Loans included in REMIC I, and (b) the Certificate Registrar, pursuant to the
written request of the Depositor executed by an officer of the Depositor, has
executed, and the Authenticating Agent has authenticated and delivered to or
upon the order of the Depositor, the Class R-I Certificates in authorized
denominations. The interests evidenced by the Class R-I Certificates, together
with the REMIC I Regular Interests, constitute the entire beneficial ownership
of REMIC I. The rights of the Class R-I Certificateholders and REMIC II (as
holder of the REMIC I Regular Interests) to receive distributions from the
proceeds of REMIC I in respect of the Class R-I Certificates and the REMIC I
Regular Interests, respectively, and all ownership interests evidenced or
constituted by the Class R-I Certificates and the REMIC I Regular Interests,
shall be as set forth in this Agreement.
SECTION 2.06. Conveyance of REMIC I Regular Interests;
Acceptance of REMIC II by Trustee.
The Depositor, as of the Closing Date, and concurrently with the
execution and delivery of this Agreement, does hereby assign without recourse
all the right, title and interest of the Depositor in and to the REMIC I Regular
Interests to the Trustee for the benefit of the Holders of the Class R-II
Certificates and REMIC III as the holder of the REMIC II Regular Interests. The
Trustee acknowledges the assignment to it of the REMIC I Regular Interests and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of all present and future Holders of the Class R-II Certificates and
REMIC III as the holder of the REMIC II Regular Interests.
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SECTION 2.07. Execution, Authentication and Delivery of Class
R-II Certificates.
The Trustee pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, as the Certificate
Registrar, authenticated, as the Authenticating Agent, and delivered to or upon
the order of the Depositor, the Class R-II Certificates in authorized
denominations.
SECTION 2.08. Conveyance of REMIC II Regular Interests;
Acceptance of REMIC III by Trustee.
The Depositor, as of the Closing Date, and concurrently with the
execution and delivery of this Agreement, does hereby assign without recourse
all the right, title and interest of the Depositor in and to the REMIC II
Regular Interests to the Trustee for the benefit of the Holders of the REMIC III
Certificates. The Trustee acknowledges the assignment to it of the REMIC II
Regular Interests and declares that it holds and will hold the same in trust for
the exclusive use and benefit of all present and future Holders of the REMIC III
Certificates.
SECTION 2.09. Execution, Authentication and Delivery of REMIC
III Certificates.
Concurrently with the assignment to it of the REMIC II Regular
Interests and in exchange therefor, the Trustee, as the Certificate Registrar,
has executed, and the Trustee, as the Authenticating Agent, has authenticated
and delivered to or upon the order of the Depositor, the REMIC III Certificates
in authorized denominations evidencing the entire beneficial ownership of REMIC
III. The rights of the holders of the respective Classes of REMIC III
Certificates to receive distributions from the proceeds of REMIC III in respect
of their REMIC III Certificates, and all ownership interests evidenced or
constituted by the respective Classes of REMIC III Certificates in such
distributions, shall be as set forth in this Agreement.
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ARTICLE III
ADMINISTRATION AND SERVICING OF THE TRUST FUND
SECTION 3.01. Administration of the Mortgage Loans.
(a) Each of the Master Servicer and the Special Servicer shall
service and administer the Mortgage Loans that each is obligated to service and
administer pursuant to this Agreement on behalf of the Trustee, for the benefit
of the Certificateholders, in accordance with any and all applicable laws, the
terms of this Agreement and the terms of the respective Mortgage Loans and, to
the extent consistent with the foregoing, in accordance with the Servicing
Standard. Without limiting the foregoing, and subject to Section 3.21, (i) the
Master Servicer shall service and administer all Mortgage Loans that are not
Specially Serviced Mortgage Loans, and (ii) the Special Servicer shall service
and administer each Specially Serviced Mortgage Loan and REO Property and shall
render such services with respect to all Mortgage Loans and REO Properties as
are specifically provided for herein. All references herein to the respective
duties of the Master Servicer and the Special Servicer, and to the areas in
which they may exercise discretion, shall be subject to Section 3.21.
(b) Subject to Section 3.01(a) and Section 6.11, the Master Servicer
and the Special Servicer each shall have full power and authority, acting alone,
to do or cause to be done any and all things in connection with such servicing
and administration which it may deem necessary or desirable. Without limiting
the generality of the foregoing, each of the Master Servicer and the Special
Servicer, in its own name, with respect to each of the Mortgage Loans it is
obligated to service hereunder, is hereby authorized and empowered by the
Trustee to execute and deliver, on behalf of the Certificateholders and the
Trustee or any of them, (i) any and all financing statements, continuation
statements and other documents or instruments necessary to maintain the lien
created by any Mortgage or other security document in the related Mortgage File
on the related Mortgaged Property and related collateral; (ii) in accordance
with the Servicing Standard and subject to Section 3.20 and Section 6.11, any
and all modifications, waivers, amendments or consents to or with respect to any
documents contained in the related Mortgage File; and (iii) any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and all other comparable instruments. Subject to Section 3.10, the
Trustee shall, at the written request of the Master Servicer or the Special
Servicer, promptly execute any limited powers of attorney and other documents
furnished by the Master Servicer or the Special Servicer that are necessary or
appropriate to enable them to carry out their servicing and administrative
duties hereunder; provided, however, that the Trustee shall not be held liable
for any misuse of any such power of attorney by the Master Servicer or the
Special Servicer.
(c) The relationship of each of the Master Servicer and the Special
Servicer to the Trustee under this Agreement is intended by the parties to be
that of an independent contractor and not that of a joint venture, partner or
agent.
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SECTION 3.02. Collection of Mortgage Loan Payments.
(a) Each of the Master Servicer or the Special Servicer shall
undertake reasonable efforts to collect all payments required under the terms
and provisions of the Mortgage Loans it is obligated to service hereunder and
shall, to the extent such procedures shall be consistent with this Agreement,
follow such collection procedures in accordance with the Servicing Standard.
Consistent with the foregoing, the Special Servicer, with regard to a Specially
Serviced Mortgage Loan, or the Master Servicer, with regard to a Mortgage Loan
that is not a Specially Serviced Mortgage Loan, may waive any Penalty Interest
or late payment charge in connection with any payment on a Mortgage Loan.
(b) All amounts collected in respect of any Mortgage Loan in the
form of payments from Mortgagors, Liquidation Proceeds (insofar as such
Liquidation Proceeds are of the nature described in clauses (i) through (iii) of
the definition thereof) or Insurance Proceeds shall be applied to either amounts
due and owing under the related Mortgage Note and Mortgage (including, without
limitation, for principal and accrued and unpaid interest) in accordance with
the express provisions of the related Mortgage Note and Mortgage or, if required
pursuant to the express provisions of the related Mortgage, or as determined by
the Master Servicer or Special Servicer in accordance with the Servicing
Standard, to the repair or restoration of the related Mortgaged Property, and,
in the absence of such express provisions, shall be applied for purposes of this
Agreement: first, as a recovery of any related and unreimbursed Advances plus
interest accrued thereon; second, as a recovery of accrued and unpaid interest
at the related Mortgage Rate on such Mortgage Loan, to the extent such amounts
have not been previously advanced, and exclusive of any portion thereof that
constitutes Additional Interest; third, as a recovery of principal of such
Mortgage Loan then due and owing, to the extent such amounts have not been
previously advanced, including, without limitation, by reason of acceleration of
the Mortgage Loan following a default thereunder; fourth, in accordance with the
normal servicing practices of the Master Servicer, as a recovery of any other
amounts then due and owing under such Mortgage Loan (other than Additional
Interest), including, without limitation, Prepayment Premiums, Yield Maintenance
Charges and Penalty Interest; fifth, as a recovery of any remaining principal of
such Mortgage Loan to the extent of its entire remaining unpaid principal
balance; and sixth, with respect to any ARD Loan after its Anticipated Repayment
Date, as a recovery of any unpaid Additional Interest. All amounts collected on
any Mortgage Loan in the form of Liquidation Proceeds of the nature described in
clauses (iv) through (vi) of the definition thereof shall be deemed to be
applied: first, as a recovery of any related and unreimbursed Advances plus
interest accrued thereon; second, as a recovery of accrued and unpaid interest
at the related Mortgage Rate on such Mortgage Loan to but not including the Due
Date in the Collection Period of receipt, to the extent such amounts have not
been previously advanced, and exclusive of any portion thereof that constitutes
Additional Interest; third, as a recovery of principal, to the extent such
amounts have not been previously advanced, of such Mortgage Loan to the extent
of its entire unpaid principal balance; and fourth, with respect to any ARD Loan
after its Anticipated Repayment Date, as a recovery of any unpaid Additional
Interest. No such amounts shall be applied to the items constituting additional
servicing compensation as described in the first
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sentence of Section 3.11(b) or 3.11(d) unless and until all principal and
interest then due and payable on such Mortgage Loan has been collected. Amounts
collected on any REO Loan shall be deemed to be applied in accordance with the
definition thereof. The provisions of this paragraph with respect to the
application of amounts collected on any Mortgage Loan shall not alter in any way
the right of the Master Servicer, the Special Servicer or any other Person to
receive payments from the Certificate Account as set forth in clauses (ii)
through (xiv) of Section 3.05(a) from amounts so applied.
(c) Within 30 days after the Closing Date, the Master Servicer shall
notify the Lease Enhancement Policy Issuer that (i) both the Master Servicer and
the Special Servicer shall be sent notices under each Lease Enhancement Policy
and (ii) the Trustee for the benefit of the Certificateholders shall be the loss
payee under each Lease Enhancement Policy. In the event that the Master Servicer
has actual knowledge of any event (an "Insured Event") giving rise to a claim
under any Lease Enhancement Policy, the Master Servicer shall notify the Special
Servicer thereof within three Business Days after learning of such event. The
Special Servicer shall prepare and file a "proof of loss" form with the Lease
Enhancement Policy Issuer within five Business Days after receiving notice of
any Insured Event under the related policy and shall diligently process any
claims under such policy in accordance with the Servicing Standard. The Special
Servicer shall give notice to the Master Servicer of any claim made under any
Lease Enhancement Policy and of any Lease Enhancement Policy Termination Event
of which the Master Servicer does not already have notice. Notwithstanding the
forgoing, with respect to each Lease Enhancement Policy that is a residual value
insurance policy, the Master Servicer will monitor the dates by which any claim
or action must be taken under such Lease Enhancement Policy to realize the full
value of such Lease Enhancement Policy for the benefit of the Certificateholders
and at least ten Business Days prior to any date on which any action must be
taken under the Lease Enhancement Policy to realize the full value of such Lease
Enhancement Policy for the benefit of the Certificateholders, the Master
Servicer shall notify the Special Servicer to take such action and upon such
notice the Special Servicer shall take such action, consistent with the
Servicing Standard.
In the event that the Master Servicer receives notice of any Lease
Enhancement Policy Termination Event, the Master Servicer shall, within three
Business Days after receipt of such notice, notify the Special Servicer and the
Trustee of such Lease Enhancement Policy Termination Event in writing. Upon
receipt of such notice, the Special Servicer shall, notwithstanding that the
servicing of the related Mortgage Loan may not have been transferred to the
Special Servicer in accordance with Section 3.21 hereof, address such Lease
Enhancement Policy Termination Event in accordance with the Servicing Standard.
Any legal fees incurred in connection with a resolution of a Lease Enhancement
Policy Termination Event shall be paid by the Special Servicer and shall be
reimbursable to it as a Trust Fund expense.
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SECTION 3.03. Collection of Taxes, Assessments and Similar
Items; Servicing Accounts; Reserve Accounts.
(a) The Master Servicer shall, as to all Mortgage Loans, establish
and maintain one or more accounts (the "Servicing Accounts"), into which all
Escrow Payments shall be deposited and retained. Each Servicing Account shall be
an Eligible Account. Withdrawals of amounts so collected from a Servicing
Account may be made (to the extent amounts have been escrowed for such purpose)
only to: (i) effect payment of items for which Escrow Payments were collected
and comparable items; (ii) reimburse the Master Servicer, the Special Servicer
or the Trustee for any Servicing Advances; (iii) refund to Mortgagors any sums
as may be determined to be overages; (iv) pay interest, if required and as
described below, to Mortgagors on balances in the Servicing Account; (v) pay
itself interest and investment income on balances in the Servicing Account as
described in Section 3.06(b), if and to the extent not required by law or the
terms of Mortgage Loan to be paid to the Mortgagor; or (vi) clear and terminate
the Servicing Account at the termination of this Agreement in accordance with
Section 9.01. To the extent permitted by law or the applicable Mortgage Loan,
funds in the Servicing Accounts may be invested only in Permitted Investments in
accordance with the provisions of Section 3.06. The Master Servicer shall pay or
cause to be paid to the Mortgagors interest, if any, earned on the investment of
funds in Servicing Accounts maintained thereby, if required by law or the terms
of the related Mortgage Loan. If the Master Servicer shall deposit in a
Servicing Account any amount not required to be deposited therein, it may at any
time withdraw such amount from such Servicing Account, any provision herein to
the contrary notwithstanding. The Servicing Accounts shall not be considered
part of the segregated pool of assets constituting REMIC I, REMIC II, REMIC III
or the Grantor Trust.
(b) The Master Servicer shall, as to all Mortgage Loans, (i)
maintain accurate records with respect to the related Mortgaged Property
reflecting the status of real estate taxes, assessments and other similar items
that are or may become a lien thereon and the status of insurance premiums and
any ground rents payable in respect thereof and (ii) use reasonable efforts to
obtain, from time to time, all bills for the payment of such items (including
renewal premiums) and shall effect payment thereof prior to the applicable
penalty or termination date. For purposes of effecting any such payment for
which it is responsible, the Master Servicer shall apply Escrow Payments as
allowed under the terms of the related Mortgage Loan or, if such Mortgage Loan
does not require the related Mortgagor to escrow for the payment of real estate
taxes, assessments, insurance premiums, ground rents (if applicable) and similar
items, the Master Servicer shall, as to all Mortgage Loans, enforce the
requirement of the related Mortgage that the Mortgagor make payments in respect
of such items at the time they first become due.
(c) The Master Servicer shall, as to all Mortgage Loans, make a
Servicing Advance with respect to the related Mortgaged Property in an amount
equal to all such funds as are necessary for the purpose of effecting the
payment of (i) real estate taxes, assessments and other similar items, (ii)
ground rents (if applicable), and (iii) premiums on Insurance
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Policies, in each instance if and to the extent Escrow Payments (if any)
collected from the related Mortgagor are insufficient to pay such item when due
and the related Mortgagor has failed to pay such item on a timely basis, and
provided that the particular Servicing Advance would not, if made, constitute a
Nonrecoverable Servicing Advance. All such Servicing Advances shall be
reimbursable in the first instance from related collections from the Mortgagors,
and further as provided in Section 3.05(a). No costs incurred by the Master
Servicer in effecting the payment of real estate taxes, assessments and, if
applicable, ground rents on or in respect of such Mortgaged Properties shall,
for purposes of this Agreement, including, without limitation, the Paying
Agent's calculation of monthly distributions to Certificateholders, be added to
the unpaid Stated Principal Balances of the related Mortgage Loans,
notwithstanding that the terms of such Mortgage Loans so permit. The foregoing
shall in no way limit the Master Servicer's ability to charge and collect from
the Mortgagor such costs together with interest thereon.
If the Master Servicer or Special Servicer is required under any
provision of this Agreement (including, but not limited to, this Section
3.03(c)) to make a Servicing Advance, but neither does so within 15 days after
such Advance is required to be made, the Trustee shall, if a Responsible Officer
of the Trustee has actual knowledge of such failure on the part of the Master
Servicer or Special Servicer, as the case may be, give written notice of such
failure, as applicable, to the Master Servicer or the Special Servicer. If such
Servicing Advance is not made by the Master Servicer or the Special Servicer
within three Business Days after such notice then (subject to a determination
that such Servicing Advance would not be a Nonrecoverable Servicing Advance) the
Trustee shall make such Servicing Advance. Any failure by the Master Servicer or
the Special Servicer to make a Servicing Advance hereunder shall constitute an
Event of Default by the Master Servicer or the Special Servicer, as the case may
be, subject to and as provided in Section 7.01.
(d) In connection with its recovery of any Servicing Advance from
the Certificate Account pursuant to Section 3.05(a), each of the Master
Servicer, the Special Servicer and the Trustee shall be entitled to receive, out
of any amounts then on deposit in the Certificate Account, any unpaid interest
at the Reimbursement Rate in effect from time to time, compounded annually,
accrued on the amount of such Servicing Advance from the date made to but not
including the date of reimbursement. The Master Servicer shall reimburse itself,
the Special Servicer or the Trustee, as appropriate and in accordance with
Section 3.05(a), for any Servicing Advance as soon as practicable after funds
available for such purpose are deposited in the Certificate Account.
(e) The determination by either the Master Servicer or the Special
Servicer that it has made a Nonrecoverable Servicing Advance or that any
proposed Servicing Advance, if made, would constitute a Nonrecoverable Servicing
Advance, shall be made in accordance with the Servicing Standard and shall be
evidenced by an Officers' Certificate delivered promptly to the Trustee and the
Depositor, setting forth the basis for such determination, together with a copy
of any appraisal of the related Mortgaged Property or REO Property, as the case
may be; which appraisal shall take into account the factors specified in Section
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3.18(e), including without limitation, any environmental, engineering or other
third party reports available, and other factors that a prudent real estate
appraiser would consider and conducted in accordance with the standards of the
Appraisal Institute performed pursuant to Section 3.09(a) by the Master Servicer
or by the Special Servicer if the Mortgage Loan is a Defaulted Mortgage Loan or,
if no such appraisal has been performed, a copy of an appraisal of the related
Mortgaged Property or REO Property performed within the twelve months preceding
such determination by an Independent Appraiser or other expert in real estate
matters, and further accompanied by related Mortgagor operating statements and
financial statements, budgets and rent rolls of the related Mortgaged Property
and any engineers' reports, environmental surveys or similar reports that the
Master Servicer or the Special Servicer may have obtained and that support such
determination. The Trustee shall be entitled to rely, conclusively, on any
determination by the Master Servicer or the Special Servicer that a Servicing
Advance, if made, would be a Nonrecoverable Advance; provided, however, that if
the Master Servicer or the Special Servicer has failed to make a Servicing
Advance for reasons other than a determination by the Master Servicer or the
Special Servicer, as applicable, that such Servicing Advance would be a
Nonrecoverable Advance, the Trustee shall make such Servicing Advance within the
time periods required by Section 3.03(c) unless the Trustee in good faith, makes
a determination that such Servicing Advance would be a Nonrecoverable Advance.
(f) The Master Servicer shall, as to all Mortgage Loans, establish
and maintain, as applicable, one or more accounts (the "Reserve Accounts"), into
which all Reserve Funds, if any, shall be deposited and retained. Withdrawals of
amounts so deposited may be made (i) to pay for, or to reimburse the related
Mortgagor in connection with, the related repairs and/or capital improvements at
the related Mortgaged Property if the repairs and/or capital improvements have
been completed, and such withdrawals are made in accordance with the Servicing
Standard and the terms of the related Mortgage Note, Mortgage and any agreement
with the related Mortgagor governing such Reserve Funds and (ii) to pay the
Master Servicer interest and investment income earned on amounts in the Reserve
Accounts as described below. To the extent permitted in the applicable Mortgage,
funds in the Reserve Accounts may be invested in Permitted Investments in
accordance with the provisions of Section 3.06. All Reserve Accounts shall be
Eligible Accounts. The Reserve Accounts shall not be considered part of the
segregated pool of assets comprising REMIC I, REMIC II, REMIC III or the Grantor
Trust. Consistent with the Servicing Standard, the Master Servicer may waive or
extend the date set forth in any agreement governing such Reserve Funds by which
the required repairs and/or capital improvements at the related Mortgaged
Property must be completed.
SECTION 3.04. Certificate Account, Interest Reserve Account
and Distribution Account.
(a) The Master Servicer shall establish and maintain one or more
accounts (collectively, the "Certificate Account"), held on behalf of the
Trustee in trust for the benefit of the Certificateholders. The Certificate
Account shall be an Eligible Account. The Master
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Servicer shall deposit or cause to be deposited in the Certificate Account,
within one Business Day of receipt of available funds (in the case of payments
by Mortgagors or other collections on the Mortgage Loans) or as otherwise
required hereunder, the following payments and collections received or made by
the Master Servicer or on its behalf subsequent to the Cut-off Date (other than
in respect of principal and interest on the Mortgage Loans due and payable on or
before the Cut-off Date, which payments shall be delivered promptly to the
appropriate Mortgage Loan Seller or its designee, with negotiable instruments
endorsed as necessary and appropriate without recourse), or payments (other than
Principal Prepayments) received by it on or prior to the Cut-off Date but
allocable to a period subsequent thereto:
(i) all payments on account of principal of the Mortgage
Loans;
(ii) all payments on account of interest on the Mortgage
Loans, including Additional Interest and Penalty Interest;
(iii) all Prepayment Premiums and Yield Maintenance Charges;
(iv) all Insurance Proceeds and Liquidation Proceeds (other
than Liquidation Proceeds described in clause (vi) of the definition
thereof that are required to be deposited in the Distribution
Account pursuant to Section 9.01) received in respect of any
Mortgage Loan;
(v) any amounts required to be deposited by the Master
Servicer pursuant to Section 3.06 in connection with losses incurred
with respect to Permitted Investments of funds held in the
Certificate Account;
(vi) any amounts required to be deposited by the Master
Servicer or the Special Servicer pursuant to Section 3.07(b) in
connection with losses resulting from a deductible clause in a
blanket hazard policy; and
(vii) any amounts required to be transferred from an REO
Account pursuant to Section 3.16(c).
The foregoing requirements for deposit in the Certificate Account
shall be exclusive. Notwithstanding the foregoing, actual payments from
Mortgagors in the nature of Escrow Payments, amounts to be deposited in Reserve
Accounts, and amounts that the Master Servicer and the Special Servicer are
entitled to retain as additional servicing compensation pursuant to Sections
3.11(b) and (d), need not be deposited by the Master Servicer in the Certificate
Account. If the Master Servicer shall deposit in the Certificate Account any
amount not required to be deposited therein, it may at any time withdraw such
amount from the Certificate Account, any provision herein to the contrary
notwithstanding. The Master Servicer shall promptly deliver to the Special
Servicer as additional servicing compensation in accordance with Section
3.11(d), assumption fees, late charges and other transaction fees received by
the Master Servicer to which the Special Servicer is entitled pursuant to either
of such Sections upon receipt of a certificate of a Servicing Officer of the
Special Servicer
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describing the item and amount. The Certificate Account shall be maintained as a
segregated account, separate and apart from trust funds created for mortgage
pass-through certificates of other series and the other accounts of the Master
Servicer.
Upon receipt of any of the amounts described in clauses (i) through
(iv) above with respect to any Mortgage Loan, the Special Servicer shall
promptly, but in no event later than one Business Day after receipt, remit such
amounts to the Master Servicer for deposit into the Certificate Account in
accordance with the second preceding paragraph, unless the Special Servicer
determines, consistent with the Servicing Standard, that a particular item
should not be deposited because of a restrictive endorsement. Any such amounts
received by the Special Servicer with respect to an REO Property shall be
deposited by the Special Servicer into the REO Account and remitted to the
Master Servicer for deposit into the Certificate Account pursuant to Section
3.16(c). With respect to any such amounts paid by check to the order of the
Special Servicer, the Special Servicer shall endorse such check to the order of
the Master Servicer and shall deliver promptly, but in no event later than three
Business Days after receipt, any such check to the Master Servicer by overnight
courier, unless the Special Servicer determines, consistent with the Servicing
Standard, that a particular item cannot be so endorsed and delivered because of
a restrictive endorsement or other appropriate reason.
(b) The Paying Agent shall establish and maintain one or more trust
accounts (collectively, the "Distribution Account") at the Corporate Trust
Office to be held in trust for the benefit of the Certificateholders. The
Distribution Account shall be an Eligible Account. The Master Servicer shall
deliver to the Paying Agent each month on or before the P&I Advance Date
therein, for deposit in the Distribution Account, an aggregate amount of
immediately available funds equal to that portion of the Available Distribution
Amount (calculated without regard to clauses (b)(ii)(B) of the definition
thereof) for the related Distribution Date then on deposit in the Certificate
Account, together with (i) any Prepayment Premiums, Yield Maintenance Charges
and/or Additional Interest received on the Mortgage Loans during the related
Collection Period and (ii) in the case of the final Distribution Date, any
additional amounts contemplated by the second paragraph of Section 9.01.
In addition, the Master Servicer shall, as and when required
hereunder, deliver to the Paying Agent for deposit in the Distribution Account:
(i) any P&I Advances required to be made by the Master
Servicer in accordance with Section 4.03(a);
(ii) any amounts required to be deposited by the Master
Servicer pursuant to Section 3.06 in connection with losses realized
on Permitted Investments with respect to funds held in the
Distribution Account;
(iii) any amounts required to be deposited by the Master
Servicer pursuant to Section 3.19 in connection with Prepayment
Interest Shortfalls; and
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(iv) the Purchase Price paid in connection with the purchase
by the Master Servicer of all of the Mortgage Loans and any REO
Properties pursuant to Section 9.01, exclusive of the portion of
such amounts required to be deposited in the Certificate Account
pursuant to Section 9.01.
The Paying Agent shall, upon receipt, deposit in the Distribution
Account any and all amounts received by the Paying Agent that are required by
the terms of this Agreement to be deposited therein.
(c) The Master Servicer shall establish and maintain one or more
accounts (collectively, the "Interest Reserve Account"), held on behalf of the
Trustee in trust for the benefit of the Certificateholders. The Interest Reserve
Account shall be an Eligible Account. On or before each Distribution Date in
February and, during each year that is not a leap year, January, the Master
Servicer shall withdraw from the Certificate Account and deposit in the Interest
Reserve Account, with respect to each Interest Reserve Loan, an amount equal to
the Interest Reserve Amount in respect of such Interest Reserve Loan for such
Distribution Date (such withdrawal from the Certificate Account to be made out
of general collections on the Mortgage Pool where any related P&I Advance was
deposited in the Distribution Account).
(d) Funds in the Certificate Account, the Interest Reserve Account
and the Distribution Account may be invested only in Permitted Investments in
accordance with the provisions of Section 3.06. The Master Servicer shall give
written notice to the Trustee, the Special Servicer and the Rating Agencies of
the location of the Certificate Account as of the Closing Date and of the new
location of the Certificate Account prior to any change thereof. The Paying
Agent shall give notice to the Trustee, the Master Servicer, the Special
Servicer and the Rating Agencies of any new location of the Distribution Account
prior to any change thereof.
SECTION 3.05. Permitted Withdrawals From the Certificate
Account, Interest Reserve Account and the
Distribution Account.
(a) The Master Servicer may, from time to time, make withdrawals
from the Certificate Account for any of the following purposes (the order set
forth below not constituting an order of priority for such withdrawals):
(i) to remit to the Paying Agent for deposit in the
Distribution Account the amounts required to be so deposited
pursuant to the first paragraph of Section 3.04(b);
(ii) to reimburse the Trustee and itself, in that order, for
unreimbursed P&I Advances, the Trustee's and Master Servicer's right
to reimbursement pursuant to this clause (ii) with respect to any
P&I Advance (other than Nonrecoverable Advances, which are
reimbursable pursuant to clause (vii) below) being limited to
amounts that represent Late Collections of
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interest (net of the related Servicing Fees) and principal (net of
any related Principal Recovery Fee) received in respect of the
particular Mortgage Loan or REO Loan as to which such P&I Advance
was made;
(iii) to pay to itself earned and unpaid Master Servicing Fees
and to pay to the Special Servicer earned and unpaid Additional
Servicing Fees, in each case in respect of each Mortgage Loan and
REO Loan, the Master Servicer's and the Special Servicer's right to
payment pursuant to this clause (iii) with respect to any Mortgage
Loan or REO Loan being limited to amounts received on or in respect
of such Mortgage Loan (whether in the form of payments, Liquidation
Proceeds or Insurance Proceeds) or such REO Loan (whether in the
form of REO Revenues, Liquidation Proceeds or Insurance Proceeds)
that are allocable as a recovery of interest thereon;
(iv) to pay to the Special Servicer earned and unpaid Special
Servicing Fees in respect of each Specially Serviced Mortgage Loan
and REO Loan;
(v) to pay the Special Servicer (or, if applicable, a
predecessor Special Servicer) earned and unpaid Principal Recovery
Fees in respect of each Specially Serviced Mortgage Loan, Corrected
Mortgage Loan and REO Loan, the Special Servicer's (or, if
applicable, any predecessor Special Servicer's) right to payment
pursuant to this clause (v) with respect to any such Mortgage Loan
or REO Loan being limited to amounts received on or in respect of
such Mortgage Loan (whether in the form of payments, Liquidation
Proceeds or Insurance Proceeds) or such REO Loan (whether in the
form of REO Revenues, Liquidation Proceeds or Insurance Proceeds)
that are allocable as a recovery of principal thereon (provided that
no Principal Recovery Fee shall be payable out of any Liquidation
Proceeds received in connection with the purchase of any Mortgage
Loan or REO Property by the applicable Mortgage Loan Seller pursuant
to the respective Mortgage Loan Purchase Agreement, by the Majority
Subordinate Certificateholder pursuant to Section 3.18(b), by the
Master Servicer or Special Servicer pursuant to Section 3.18(c) or
by the Depositor, the Master Servicer, Lehman Brothers Inc., the
Special Servicer or the Majority Subordinate Certificateholder
pursuant to Section 9.01);
(vi) to reimburse the Trustee, itself or the Special Servicer,
in that order, for any unreimbursed Servicing Advances, the
Trustee's, the Master Servicer's and the Special Servicer's
respective rights to reimbursement pursuant to this clause (vi) with
respect to any Servicing Advance being limited to payments made by
the related Mortgagor that are allocable to such Servicing Advance,
or to Liquidation Proceeds, Insurance Proceeds and, if applicable,
REO Revenues received in respect of the particular Mortgage Loan or
REO Property as to which such Servicing Advance was made;
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(vii) to reimburse the Trustee, itself or the Special
Servicer, in that order, for any unreimbursed Advances that have
been or are determined to be Nonrecoverable Advances or to pay
itself, with respect to any Mortgage Loan or REO Property, any
related earned Servicing Fee that remained unpaid in accordance with
clause (iii) above following a Final Recovery Determination made
with respect to such Mortgage Loan or REO Property and the deposit
into the Certificate Account of all amounts received in connection
therewith;
(viii) at such time as it reimburses the Trustee, itself or
the Special Servicer, in that order, for any unreimbursed Advance
pursuant to clause (ii), (vi) or (vii) above, to pay the Trustee,
itself or the Special Servicer, as the case may be, in that order,
any interest accrued and payable thereon in accordance with Section
3.03(d) or 4.03(d), as applicable;
(ix) to pay for costs and expenses incurred by the Trust Fund
pursuant to Section 3.09(c);
(x) to pay itself, as additional servicing compensation in
accordance with Section 3.11(b), interest and investment income
earned in respect of amounts held in the Certificate Account as
provided in Section 3.06(b), but only to the extent of the Net
Investment Earnings with respect to the Certificate Account for any
Collection Period;
(xi) to pay for the cost of an independent appraiser or other
expert in real estate matters retained pursuant to Section 3.03(e),
3.09(a), 3.18(e) or 4.03(c);
(xii) to pay itself, the Special Servicer, the Depositor, or
any of their respective directors, officers, employees and agents,
as the case may be, any amounts payable to any such Person pursuant
to Section 6.03;
(xiii) to pay for (A) the advice of counsel and tax
accountants contemplated by Section 3.17(a)(iii), (B) the cost of
the Opinions of Counsel contemplated by Sections 3.09(b)(ii),
3.09(c), 3.16(a) and 11.02(a), (C) the cost of an Opinion of Counsel
contemplated by Section 11.01(a) or 11.01(c) in connection with any
amendment to this Agreement requested by the Master Servicer or the
Special Servicer that protects or is in furtherance of the rights
and interests of Certificateholders, (D) the cost of obtaining any
REO Extension sought by the Special Servicer as contemplated by
Section 3.16(a), and (E) the cost of recording this Agreement in
accordance with Section 11.02(a);
(xiv) to pay itself, the Special Servicer, the appropriate
Mortgage Loan Seller, the Majority Subordinate Certificateholder or
any other Person, as the case may be, with respect to each Mortgage
Loan, if any, previously purchased
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by such Person pursuant to this Agreement, all amounts received
thereon subsequent to the date of purchase;
(xv) to withdraw any Interest Reserve Amount and deposit such
Interest Reserve Amount into the Interest Reserve Account pursuant
to Section 3.04(c); and
(xvi) to clear and terminate the Certificate Account at the
termination of this Agreement pursuant to Section 9.01.
The Master Servicer shall keep and maintain separate accounting
records, on a loan-by-loan and property-by-property basis when appropriate, in
connection with any withdrawal from the Certificate Account pursuant to clauses
(ii) - (xv) above.
The Master Servicer shall pay to the Special Servicer (or to third
party contractors at the direction of the Special Servicer) or the Trustee from
the Certificate Account amounts permitted to be paid to the Special Servicer (or
to such third party contractors), the Trustee therefrom promptly upon receipt of
a certificate of a Servicing Officer of the Special Servicer or of a Responsible
Officer of the Trustee describing the item and amount to which the Special
Servicer (or such third party contractors), the Trustee is entitled. The Master
Servicer may rely conclusively on any such certificate and shall have no duty to
re-calculate the amounts stated therein. The Special Servicer shall keep and
maintain separate accounting for each Specially Serviced Mortgage Loan and REO
Property, on a loan-by-loan and property-by-property basis, for the purpose of
justifying any request for withdrawal from the Certificate Account. With respect
to each Mortgage Loan for which it makes an Advance, the Trustee shall similarly
keep and maintain separate accounting for each Mortgage Loan, on a loan-by-loan
and property-by-property basis, for the purpose of justifying any request for
withdrawal from the Certificate Account for reimbursements of Advances or
interest thereon.
(b) The Paying Agent may, from time to time, make withdrawals from
the Distribution Account for any of the following purposes (in no particular
order of priority):
(i) to make distributions to Certificateholders on each
Distribution Date pursuant to Section 4.01 or 9.01, as applicable;
(ii) to pay the Trustee or any of their respective directors,
officers, employees and agents, as the case may be, any amounts
payable or reimbursable to any such Person pursuant to Section 8.05;
(iii) to pay the Master Servicer, as additional servicing
compensation in accordance with Section 3.11(b), interest and
investment income earned in respect of amounts held in the
Distribution Account as provided in Section 3.06(b) (but only to the
extent of the Net Investment Earnings with respect to the
Distribution Account for any Collection Period);
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(iv) to pay for the cost of the Opinions of Counsel sought by
the Trustee (A) as provided in clause (v) of the definition of
"Disqualified Organization", (B) as contemplated by Sections
9.02(a)(i) and 10.01(i), or (C) as contemplated by Section 11.01(a)
or 11.01(c) in connection with any amendment to this Agreement
requested by the Trustee which amendment is in furtherance of the
rights and interests of Certificateholders;
(v) to pay any and all federal, state and local taxes imposed
on any of the REMICs created hereunder or on the assets or
transactions of any such REMIC, together with all incidental costs
and expenses, to the extent none of the Trustee, the REMIC
Administrator, the Master Servicer or the Special Servicer is liable
therefor pursuant to Section 10.01(j);
(vi) to pay the REMIC Administrator any amounts reimbursable
to it pursuant to Section 10.01(f);
(vii) to pay to the Master Servicer any amounts deposited by
the Master Servicer in the Distribution Account not required to be
deposited therein; and
(viii) to clear and terminate the Distribution Account at the
termination of this Agreement pursuant to Section 9.01.
(c) The Master Servicer shall on each P&I Advance Date to occur in
March of each year, withdraw from the Interest Reserve Account and deposit into
the Distribution Account in respect of each Interest Reserve Loan, an amount
equal to the aggregate of the Interest Reserve Amounts deposited into the
Interest Reserve Account pursuant to Section 3.04(c) during the immediately
preceding Collection Period and, if applicable, the second preceding Collection
Period.
SECTION 3.06. Investment of Funds in the Servicing Accounts,
the Reserve Accounts, the Certificate Account,
the Distribution Account and the REO Account.
(a) The Master Servicer may direct in writing any depository
institution maintaining a Servicing Account, a Reserve Account, the Interest
Reserve Account or the Certificate Account and may direct in writing the Paying
Agent with respect to the Distribution Account (each, for purposes of this
Section 3.06, an "Investment Account"), and the Special Servicer may direct in
writing any depository institution maintaining the REO Account (also, for
purposes of this Section 3.06, an "Investment Account"), to invest, or if it is
such depository institution, may itself invest, the funds held therein in one or
more Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, no later than the Business Day immediately preceding
the next succeeding date on which such funds are required to be withdrawn from
such account pursuant to this Agreement. In the
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event that the Master Servicer shall have failed to give investment directions
for any Servicing Account, any Reserve Account, the Certificate Account, the
Interest Reserve Account or the Distribution Account (exclusive of any accounts
as are held by the Master Servicer) or the Special Servicer shall have failed to
give investment directions for the REO Account by 11:00 A.M. New York time on
any Business Day on which there may be uninvested cash, such funds held in the
REO account shall be invested in securities described in clause (i) of the
definition of the term "Permitted Investments"; and such funds held in such
other accounts shall be invested in securities described in clause (v) of such
definition. The Paying Agent agrees that funds in the Distribution Account will
be invested in accordance herewith on the day of receipt if received by 5:00
P.M. New York time. All such Permitted Investments shall be held to maturity,
unless payable on demand. Any investment of funds in an Investment Account shall
be made in the name of the Trustee (in its capacity as such). The Master
Servicer (with respect to Permitted Investments of amounts in the Servicing
Accounts, the Reserve Accounts, the Certificate Account, the Interest Reserve
Account and the Distribution Account) and the Special Servicer (with respect to
Permitted Investments of amounts in the REO Account), on behalf of the Trustee,
shall (and the Trustee hereby designates the Master Servicer and the Special
Servicer, as applicable, as the person that shall) maintain continuous
possession of any Permitted Investment that is either (i) a "certificated
security", as such term is defined in the UCC, or (ii) other property in which a
secured party may perfect its security interest by possession under the UCC or
any other applicable law. Possession of any such Permitted Investment by the
Master Servicer or the Special Servicer shall constitute possession by a Person
designated by the Trustee for purposes of Section 8-313 of the UCC and
possession by the Trustee, as secured party, for purposes of Section 9-305 of
the UCC and any other applicable law. If amounts on deposit in an Investment
Account are at any time invested in a Permitted Investment payable on demand,
the Master Servicer (in the case of the Certificate Account, Servicing Accounts,
the Interest Reserve Account and Reserve Accounts), the Paying Agent (in the
case of the Distribution Account) or the Special Servicer (in the case of the
REO Account) shall:
(x) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such Permitted
Investment may otherwise mature hereunder in an amount equal to the lesser
of (1) all amounts then payable thereunder and (2) the amount required to
be withdrawn on such date; and
(y) demand payment of all amounts due thereunder promptly upon
determination by the Master Servicer or the Special Servicer, as the case
may be, that such Permitted Investment would not constitute a Permitted
Investment in respect of funds thereafter on deposit in the Investment
Account.
(b) Whether or not the Master Servicer directs the investment of
funds in any of the Servicing Accounts, the Reserve Accounts, the Certificate
Account, the Interest Reserve Account or the Distribution Account, interest and
investment income realized on funds deposited therein, to the extent of the
related Net Investment Earnings, if any, for each Collection Period and, in the
case of a Reserve Account or a Servicing Account, to the extent
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not otherwise payable to the related Mortgagor in accordance with applicable law
or the related loan documents, shall be for the sole and exclusive benefit of
the Master Servicer and shall be subject to its withdrawal in accordance with
Section 3.03(a), 3.03(f) or 3.05(a) or withdrawal by the Paying Agent at its
direction in accordance with Sections 3.05(b), as applicable. Whether or not the
Special Servicer directs the investment of funds in the REO Account, interest
and investment income realized on funds deposited therein, to the extent of the
Net Investment Earnings, if any, for each Collection Period, shall be for the
sole and exclusive benefit of the Special Servicer and shall be subject to its
withdrawal in accordance with Section 3.16(b). If any loss shall be incurred in
respect of any Permitted Investment on deposit in any Investment Account, the
Master Servicer (in the case of the Servicing Accounts, the Reserve Accounts,
the Certificate Account and the Distribution Account) and the Special Servicer
(in the case of the REO Account) shall promptly deposit therein from its own
funds, without right of reimbursement, no later than the end of the Collection
Period during which such loss was incurred, the amount of the Net Investment
Loss, if any, for such Collection Period.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment and the Special Servicer or the Master Servicer fails to deposit any
losses with respect to such Permitted Investment pursuant to Section 3.06(b),
the Trustee may and, subject to Section 8.02, upon the request of Holders of
Certificates entitled to not less than 25% of the Voting Rights allocated to any
Class, shall take such action as may be appropriate to enforce such payment or
performance, including the institution and prosecution of appropriate
proceedings.
(d) Notwithstanding the investment of funds held in any Investment
Account, for purposes of the calculations hereunder, including, without
limitation, the calculation of the Available Distribution Amount, the amounts so
invested shall be deemed to remain on deposit in such Investment Account.
SECTION 3.07. Maintenance of Insurance Policies; Errors and
Omissions and Fidelity Coverage.
(a) The Master Servicer (with respect to Mortgage Loans other than
Specially Serviced Mortgaged Loans) and the Special Servicer (with respect to
Specially Serviced Mortgage Loans) shall, consistent with the Servicing
Standard, cause to be maintained for each Mortgaged Property all insurance
coverage as is required under the related Mortgage; provided that if and to the
extent that any such Mortgage permits the holder thereof any discretion (by way
of consent, approval or otherwise) as to the insurance coverage that the related
Mortgagor is required to maintain, the Master Servicer shall exercise such
discretion in a manner consistent with the Servicing Standard; and provided
further that, if and to the extent that a Mortgage so permits, the related
Mortgagor shall be required to exercise its reasonable best efforts to obtain
the required insurance coverage from Qualified Insurers that have a "claims
paying ability" rating of at least "A" from Standard & Poor's and a comparable
rating from at least one other nationally recognized statistical rating agency.
The Majority
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Subordinate Certificateholder may request that earthquake insurance be secured
for one or more Mortgaged Properties at the expense of the Majority Subordinate
Certificateholder. Subject to Section 3.17(a), the Special Servicer shall also
cause to be maintained for each REO Property no less insurance coverage than was
previously required of the Mortgagor under the related Mortgage; provided that
all such insurance shall be obtained from Qualified Insurers that, if they are
providing casualty insurance, shall have a claims paying ability rating of at
least "A" and "A2" from Standard & Poor's and Moody's (if then rated by
Moody's), respectively (or Standard & Poor's and a comparable rating from one
other nationally recognized statistical rating agency, if such insurer is not
rated by Moody's) or such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to the Certificates, as
evidenced in writing by the Rating Agencies. All such insurance policies shall
contain (if they insure against loss to property and do not relate to an REO
Property) a "standard" mortgagee clause, with loss payable to the Master
Servicer (in the case of insurance maintained in respect of Mortgage Loans), and
shall be in the name of the Special Servicer (in the case of insurance
maintained in respect of REO Properties), on behalf of the Trustee; in each case
such insurance shall be issued by an insurer authorized under applicable law to
issue such insurance. Any amounts collected by the Master Servicer or the
Special Servicer under any such policies (other than amounts to be applied to
the restoration or repair of the related Mortgaged Property or REO Property or
amounts to be released to the related Mortgagor, in each case subject to the
rights of any tenants and ground lessors, as the case may be, and in each case
in accordance with the terms of the related Mortgage and the Servicing Standard)
shall be deposited in the Certificate Account, subject to withdrawal pursuant to
Section 3.05(a), in the case of amounts received in respect of a Mortgage Loan,
or in the REO Account, subject to withdrawal pursuant to Section 3.16(c), in the
case of amounts received in respect of an REO Property. Any cost incurred by the
Master Servicer or the Special Servicer in maintaining any such insurance shall
not, for purposes hereof, including, without limitation, calculating monthly
distributions to Certificateholders, be added to unpaid principal balance of the
related Mortgage Loan, notwithstanding that the terms of such Mortgage Loan so
permit.
(b) If the Master Servicer or the Special Servicer shall obtain and
maintain, or cause to be obtained and maintained, a blanket policy insuring
against hazard losses on all of the Mortgage Loans and/or REO Properties that it
is required to service and administer, then, to the extent such policy (i) is
obtained from a Qualified Insurer having a claims-paying rating of at least "A"
and "A2" from Standard & Poor's and Moody's, respectively (or Standard & Poor's
and a comparable rating from one other nationally recognized statistical rating
agency, if such insurer is not rated by Moody's) or such lower rating of any
Rating Agency or rating from any other nationally recognized statistical rating
agency as will not result in qualification, downgrading or withdrawal of the
ratings then assigned to the Certificates, as evidenced in writing by the Rating
Agencies, and (ii) provides protection equivalent to the individual policies
otherwise required, the Master Servicer or the Special Servicer, as the case may
be, shall conclusively be deemed to have satisfied its obligation to cause
hazard insurance to be maintained on the related Mortgaged Properties and/or REO
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Properties. Such blanket policy may contain a deductible clause (not in excess
of a customary amount), in which case the Master Servicer or the Special
Servicer, as appropriate, shall, if there shall not have been maintained on the
related Mortgaged Property or REO Property a hazard insurance policy complying
with the requirements of Section 3.07(a), and there shall have been one or more
losses that would have been covered by such policy, promptly deposit into the
Certificate Account from its own funds the amount not otherwise payable under
the blanket policy because of such deductible clause. The Master Servicer or the
Special Servicer, as appropriate, shall prepare and present, on behalf of
itself, the Trustee and Certificateholders, claims under any such blanket policy
in a timely fashion in accordance with the terms of such policy.
(c) Each of the Master Servicer and the Special Servicer shall at
all times during the term of this Agreement (or, in the case of the Special
Servicer, at all times during the term of this Agreement in which Specially
Serviced Mortgage Loans or REO Properties are part of the Trust Fund) keep in
force with Qualified Insurers a fidelity bond issued by an insurer having a
claims-paying rating of at least "A" and "A2" from Standard & Poor's and Moody's
(if then rated by Moody's), respectively, or such lower rating of any Rating
Agency or rating from any other nationally recognized statistical rating agency
as will not result in qualification, downgrading or withdrawal of the ratings
then assigned to the Certificates, as evidenced in writing by the Rating
Agencies, such fidelity bond to be in such form and amount as would permit it to
be a qualified FNMA seller-servicer of multifamily mortgage loans, or in such
other form and amount as would not cause the qualification, downgrading or
withdrawal of any rating assigned by any Rating Agency to the Certificates (as
evidenced in writing from each Rating Agency); and provided that the Master
Servicer's current fidelity insurer, Travellers Insurance Company, shall be
deemed to satisfy the requirements of this section so long as it has a
claims-paying rating of "A" or better from Standard & Poor's and Baa3 or higher
by Moody's. Each of the Master Servicer and the Special Servicer shall be deemed
to have complied with the foregoing provision if an Affiliate thereof has such
fidelity bond coverage and, by the terms of such fidelity bond, the coverage
afforded thereunder extends to the Master Servicer or the Special Servicer, as
the case may be. Such fidelity bond shall provide for ten days' written notice
to the Trustee prior to any cancellation.
Each of the Master Servicer and the Special Servicer shall at all
times during the term of this Agreement (or, in the case of the Special
Servicer, at all times during the term of this Agreement in which Specially
Serviced Mortgage Loans and/or REO Properties exist as part of the Trust Fund)
also keep in force with Qualified Insurers having a claims-paying rating of at
least "A" and "A2" from Standard & Poor's and Moody's (if then rated by
Moody's), respectively, or such lower rating as will not result in
qualification, downgrading or withdrawal of the ratings then assigned to the
Certificates, as evidenced in writing by the Rating Agencies, respectively, a
policy or policies of insurance covering loss occasioned by the errors and
omissions of its officers, employees and agents in connection with its servicing
obligations hereunder, which policy or policies shall be in such form and amount
as would permit it to be a qualified FNMA seller-servicer of multifamily
mortgage loans, or in such other form and amount as would not adversely affect
any rating assigned by any Rating
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Agency to the Certificates (as evidenced in writing from each Rating Agency).
Each of the Master Servicer and the Special Servicer shall be deemed to have
complied with the foregoing provisions if an Affiliate thereof has such
insurance and, by the terms of such policy or policies, the coverage afforded
thereunder extends to the Master Servicer or the Special Servicer, as the case
may be. Any such errors and omissions policy shall provide for ten days' written
notice to the Trustee prior to cancellation. The Master Servicer and the Special
Servicer shall each cause the Trustee to be an additional loss payee on any
policy currently in place or procured pursuant to the requirements of this
Section 3.07(c).
For so long as the long-term debt obligations of the Master Servicer
or Special Servicer, as the case may be (or in the case of the initial Master
Servicer and Special Servicer, their respective direct or indirect parent), are
rated at least "A" or the equivalent by all of the Rating Agencies (or such
lower rating as will not result in qualification, downgrading or withdrawal of
the ratings then assigned to the Certificates, as evidenced in writing by the
Rating Agencies), such Person may self-insure with respect to the risks
described in this subsection.
SECTION 3.08. Enforcement of Alienation Clauses.
With respect to all Mortgage Loans, the Special Servicer, on behalf of the
Trustee as the mortgagee of record, shall, to the extent permitted by applicable
law, enforce the restrictions contained in the related Mortgage on transfers or
further encumbrances of the related Mortgaged Property and on transfers of
interests in the related Mortgagor, unless the Special Servicer has determined,
consistent with the Servicing Standard, that waiver of such restrictions would
be in accordance with the Servicing Standard. Promptly after the Special
Servicer has made any such determination, the Special Servicer shall deliver to
the Trustee, the Rating Agencies and the Master Servicer an Officers'
Certificate setting forth the basis for such determination. The Special Servicer
shall not exercise any such waiver in respect of a due-on-encumbrance provision
without receiving the prior written confirmation from the Rating Agencies that
such action would not result in a downgrading, qualification or withdrawal of
the ratings then assigned to the Certificates. The Special Servicer shall not
exercise any such waiver in respect of a due-on-sale provision of any Mortgage
Loan for which the sum of the principal balance of such Mortgage Loan and the
principal balance of all other Mortgage Loans that are cross-collateralized,
cross-defaulted or have been made to Mortgagors affiliated with the Mortgagor on
such Mortgage Loan exceeds 5% of the aggregate principal balance of all of the
Mortgage Loans as of the date of such proposed waiver, without receiving the
prior written confirmation from the Rating Agencies that such action would not
result in a downgrading, qualification or withdrawal of any of the ratings then
assigned to the Certificates.
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SECTION 3.09. Realization Upon Defaulted Mortgage Loans;
Required Appraisals.
(a) The Special Servicer shall, subject to Sections 3.09(b) through
3.09(d) and Section 6.11, exercise reasonable efforts, consistent with the
Servicing Standard, to foreclose upon or otherwise comparably convert the
ownership of properties securing such of the Mortgage Loans as come into and
continue in default and as to which no satisfactory arrangements can be made for
collection of delinquent payments, including, without limitation, pursuant to
Section 3.20. The Special Servicer shall advance all costs and expenses (other
than costs or expenses that would, if incurred, constitute a Nonrecoverable
Servicing Advance) incurred by it in any such proceedings, and shall be entitled
to reimbursement therefor as provided in Section 3.05(a). Nothing contained in
this Section 3.09 shall be construed so as to require the Special Servicer, on
behalf of the Trust Fund, to make a bid on any Mortgaged Property at a
foreclosure sale or similar proceeding that is in excess of the fair market
value of such property, as determined by the Special Servicer in its reasonable
and good faith judgment taking into account the factors described in Section
3.18(e) and the results of any appraisal obtained pursuant to the following
sentence, all such bids to be made in a manner consistent with the Servicing
Standard. If and when the Master Servicer or the Special Servicer deems it
necessary and prudent for purposes of establishing the fair market value of any
Mortgaged Property securing a defaulted Mortgage Loan, whether for purposes of
bidding at foreclosure or otherwise, it may, at the expense of the Trust Fund,
have an appraisal performed with respect to such property by an Independent
Appraiser or other expert in real estate matters; which appraisal shall take
into account the factors specified in Section 3.18(e), including without
limitation, any environmental, engineering or other third party reports
available, and other factors that a prudent real estate appraiser would
consider. With respect to each Required Appraisal Mortgage Loan, the Special
Servicer will be required to obtain a Required Appraisal within 60 days of a
Mortgage Loan becoming a Required Appraisal Mortgage Loan (unless an appraisal
meeting the requirements of a Required Appraisal was obtained for such Required
Appraisal Mortgage Loan within the prior 3 months in which case such appraisal
shall be the Required Appraisal) and thereafter shall obtain a letter update of
such Required Appraisal once every 12 months if such Mortgage Loan remains a
Required Appraisal Mortgage Loan. The Special Servicer shall advance the cost of
such Required Appraisal; provided, however, that such expense will be subject to
reimbursement to the Special Servicer as a Servicing Advance out of the
Certificate Account pursuant to Section 3.05(a).
(b) The Special Servicer shall not acquire any personal property
pursuant to this Section 3.09 unless either:
(i) such personal property is incident to real property
(within the meaning of Section 856(e)(1) of the Code) so acquired by
the Special Servicer; or
(ii) the Special Servicer shall have obtained an Opinion of
Counsel (the cost of which may be withdrawn from the Certificate
Account pursuant to
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Section 3.05(a)) to the effect that the holding of such personal
property as part of the Trust Fund will not cause the imposition of
a tax on any of REMIC I, REMIC II or REMIC III under the REMIC
Provisions or cause any of REMIC I, REMIC II or REMIC III to fail to
qualify as a REMIC at any time that any Certificate is outstanding.
(c) Notwithstanding the foregoing provisions of this Section 3.09,
neither the Master Servicer nor the Special Servicer shall, on behalf of the
Trustee, obtain title to a Mortgaged Property by deed in lieu of foreclosure or
otherwise, or take any other action with respect to any Mortgaged Property, if,
as a result of any such action, the Trustee, on behalf of the
Certificateholders, could, in the reasonable judgment of the Master Servicer or
the Special Servicer, as the case may be, made in accordance with the Servicing
Standard, be considered to hold title to, to be a "mortgagee-in-possession" of,
or to be an "owner" or "operator" of such Mortgaged Property within the meaning
of CERCLA or any comparable law (a "potentially responsible party"), unless (as
evidenced by an Officers' Certificate to such effect delivered to the Trustee
that shall specify all of the bases for such determination) the Special Servicer
has previously determined in accordance with the Servicing Standard, and based
on a Environmental Assessment of such Mortgaged Property performed by an
Independent Person who regularly conducts Environmental Assessments and
performed within six months prior to any such acquisition of title or other
action (a copy of which Environmental Assessment shall be delivered to the
Trustee and the Master Servicer), that:
(i) the Mortgaged Property is in compliance with applicable
environmental laws and regulations or, if not, that it would
maximize the recovery to the Certificateholders on a present value
basis (the relevant discounting of anticipated collections that will
be distributable to Certificateholders to be performed at the
related Net Mortgage Rate) to acquire title to or possession of the
Mortgaged Property and to take such actions as are necessary to
bring the Mortgaged Property into compliance therewith in all
material respects; and
(ii) there are no circumstances or conditions present at the
Mortgaged Property relating to the use, management or disposal of
Hazardous Materials for which investigation, testing, monitoring,
containment, clean-up or remediation could be required under any
applicable environmental laws and regulations or, if such
circumstances or conditions are present for which any such action
could reasonably be expected to be required, that it would maximize
the recovery to the Certificateholders on a present value basis (the
relevant discounting of anticipated collections that will be
distributable to Certificateholders to be performed at the related
Net Mortgage Rate) to acquire title to or possession of the
Mortgaged Property and to take such actions with respect to the
affected Mortgaged Property.
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The Special Servicer shall undertake, in good faith, reasonable
efforts to make the determination referred to in the preceding paragraph and may
conclusively rely on the Environmental Assessment referred to above in making
such determination. The cost of any such Environmental Assessment, as well as
the cost of any remedial, corrective or other further action contemplated by
clause (i) and/or clause (ii) of the preceding paragraph, may be reimbursed to
the Special Servicer from the Certificate Account as a Servicing Advance; and if
any such Environmental Assessment so warrants, the Special Servicer shall, as a
Servicing Advance, perform such additional environmental testing as it deems
necessary and prudent to determine whether the conditions described in clauses
(i) and (ii) of the preceding paragraph have been satisfied.
(d) If the environmental testing contemplated by Section 3.09(c)
above establishes that any of the conditions set forth in clauses (i) and (ii)
of the first sentence thereof has not been satisfied with respect to any
Mortgaged Property securing a defaulted Mortgage Loan, the Special Servicer
shall take such action as is in accordance with the Servicing Standard (other
than proceeding against the Mortgaged Property) and, at such time as it deems
appropriate, may, on behalf of the Trustee, release all or a portion of such
Mortgaged Property from the lien of the related Mortgage; provided that, if such
Mortgage Loan has a then outstanding principal balance of greater than $1
million, then prior to the release of all or a portion of the related Mortgaged
Property from the lien of the related Mortgage, (i) the Special Servicer shall
have notified the Rating Agencies, Trustee and the Master Servicer in writing of
its intention to so release all or a portion of such Mortgaged Property and the
bases for such intention, (ii) the Trustee shall have notified the
Certificateholders in writing of the Special Servicer's intention to so release
all or a portion of such Mortgaged Property and (iii) the Holders of
Certificates entitled to a majority of the Voting Rights shall have consented to
such release within 30 days of the Trustee's distributing such notice (failure
to respond by the end of such 30-day period being deemed consent).
(e) The Special Servicer shall report to the Master Servicer, Lehman
Brothers Inc. and the Trustee monthly in writing as to any actions taken by the
Special Servicer with respect to any Mortgaged Property that represents security
for a defaulted Mortgage Loan as to which the environmental testing contemplated
in Section 3.09(c) above has revealed that any of the conditions set forth in
clauses (i) and (ii) of the first sentence thereof has not been satisfied, in
each case until the earlier to occur of satisfaction of all such conditions and
release of the lien of the related Mortgage on such Mortgaged Property.
(f) The Special Servicer shall have the right to determine, in
accordance with the Servicing Standard, the advisability of seeking to obtain a
deficiency judgment if the state in which the Mortgaged Property is located and
the terms of the Mortgage Loan permit such an action and shall, in accordance
with the Servicing Standard, seek such deficiency judgment if it deems
advisable.
(g) The Special Servicer shall prepare and file information returns
with respect to the receipt of mortgage interest received in a trade or
business, the reports of
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foreclosures and abandonments of any Mortgaged Property and the information
returns relating to cancellation of indebtedness income with respect to any
Mortgaged Property required by Sections 6050H, 6050J and 6050P of the Code and
each year deliver to the Trustee and the Master Servicer an Officers'
Certificate stating that such reports have been filed. Such reports shall be in
form and substance sufficient to meet the reporting requirements imposed by
Sections 6050H, 6050J and 6050P of the Code.
(h) The Special Servicer shall maintain accurate records, prepared
by a Servicing Officer, of each Final Recovery Determination in respect of any
Mortgage Loan or REO Property and the basis thereof. Each Final Recovery
Determination shall be evidenced by an Officers' Certificate delivered to the
Trustee and the Master Servicer no later than the third Business Day following
such Final Recovery Determination.
(i) Upon reasonable request of the Master Servicer, the Special
Servicer shall deliver to it and the related Sub-Servicer any other information
and copies of any other documents in its possession with respect to a Specially
Serviced Mortgage Loan or the related Mortgaged Property.
SECTION 3.10. Trustee and Custodian to Cooperate; Release of
Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by
the Master Servicer of a notification that payment in full shall be escrowed in
a manner customary for such purposes, the Master Servicer shall promptly notify
the Trustee in writing, who shall release or cause the related Custodian to
release, by a certification (which certification shall be in the form of a
Request for Release in the form of Exhibit D-1 attached hereto and shall be
accompanied by the form of a release or discharge and shall include a statement
to the effect that all amounts received or to be received in connection with
such payment which are required to be deposited in the Certificate Account
pursuant to Section 3.04(a) have been or will be so deposited) of a Servicing
Officer (a copy of which certification shall be delivered to the Special
Servicer) and shall request delivery to it of the related Mortgage File. Upon
receipt of such certification and request, the Trustee shall release, or cause
any related Custodian to release, the related Mortgage File to the Master
Servicer and shall deliver to the Master Servicer such release or discharge,
duly executed. No expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall be chargeable to the Certificate
Account or the Distribution Account.
(b) If from time to time, and as appropriate for servicing or
foreclosure of any Mortgage Loan, the Master Servicer or the Special Servicer
shall otherwise require any Mortgage File (or any portion thereof), the Trustee,
upon request of the Master Servicer and receipt from the Master Servicer of a
Request for Release in the form of Exhibit D-1 attached hereto signed by a
Servicing Officer thereof, or upon request of the Special Servicer and receipt
from the Special Servicer of a Request for Release in the form of Exhibit D-2
attached hereto, shall release, or cause any related Custodian to release, such
Mortgage File (or portion
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thereof) to the Master Servicer or the Special Servicer, as the case may be.
Upon return of such Mortgage File (or portion thereof) to the Trustee or related
Custodian, or the delivery to the Trustee of a certificate of a Servicing
Officer of the Special Servicer stating that such Mortgage Loan was liquidated
and that all amounts received or to be received in connection with such
liquidation that are required to be deposited into the Certificate Account
pursuant to Section 3.04(a) have been or will be so deposited, or that such
Mortgage Loan has become an REO Property, a copy of the Request for Release
shall be released by the Trustee or related Custodian to the Master Servicer or
the Special Servicer, as applicable.
(c) Within seven Business Days (or within such shorter period (but
no less than three Business Days) as execution and delivery can reasonably be
accomplished if the Special Servicer notifies the Trustee of an exigency) of the
Special Servicer's request therefor, the Trustee shall execute and deliver to
the Special Servicer (or the Special Servicer may execute and deliver in the
name of the Trustee based on a limited power of attorney issued in favor of the
Special Servicer pursuant to Section 3.01(b)), in the form supplied to the
Trustee, any court pleadings, requests for trustee's sale or other documents
stated by the Special Servicer to be reasonably necessary to the foreclosure or
trustee's sale in respect of a Mortgaged Property or REO Property or to any
legal action brought to obtain judgment against any Mortgagor on the Mortgage
Note or Mortgage or to obtain a deficiency judgment, or to enforce any other
remedies or rights provided by the Mortgage Note or Mortgage or otherwise
available at law or in equity or to defend any legal action or counterclaim
filed against the Trust Fund, the Master Servicer or the Special Servicer.
Together with such documents or pleadings, the Special Servicer shall deliver to
the Trustee a certificate of a Servicing Officer requesting that such pleadings
or documents be executed by the Trustee and certifying as to the reason such
documents or pleadings are required and that the execution and delivery thereof
by the Trustee will not invalidate or otherwise affect the lien of the Mortgage,
except for the termination of such a lien upon completion of the foreclosure or
trustee's sale.
SECTION 3.11. Servicing Compensation.
(a) As compensation for its activities hereunder, the Master
Servicer shall be entitled to receive the Master Servicing Fee with respect to
each Mortgage Loan (including each Specially Serviced Mortgage Loan) and REO
Loan. As to each such Mortgage Loan and REO Loan, the Master Servicing Fee shall
accrue at the related Master Servicing Fee Rate and on the same principal amount
respecting which the related interest payment due on such Mortgage Loan or
deemed to be due on such REO Loan is computed and calculated on the basis of a
360-day year consisting of twelve 30-day months (or, in the event of a Principal
Prepayment in full or other Liquidation Event with respect to a Mortgage Loan or
REO Loan, on the basis of the actual number of days to elapse from and including
the related Due Date to but excluding the date of such Principal Prepayment or
Liquidation Event in a month consisting of 30 days). The Master Servicing Fee
with respect to any Mortgage Loan or REO Loan shall cease to accrue if a
Liquidation Event occurs in respect thereof. Earned but unpaid Master Servicing
Fees shall be payable monthly, on a loan-by-loan basis, from payments of
interest on each Mortgage Loan and REO Revenues allocable as interest on each
REO Loan.
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The Master Servicer shall be entitled to recover unpaid Master Servicing Fees in
respect of any Mortgage Loan or REO Loan out of that portion of related
Insurance Proceeds or Liquidation Proceeds allocable as recoveries of interest,
to the extent permitted by Section 3.05(a)(iii). The right to receive the Master
Servicing Fee may not be transferred in whole or in part except in connection
with the transfer of all of the Master Servicer's responsibilities and
obligations under this Agreement.
(b) Additional servicing compensation in the form of (i) late
charges, Penalty Interest, assumption application fees, modification fees for
Mortgage Loan modifications made pursuant to Section 3.20(i), charges for
beneficiary statements or demands, amounts collected for checks returned for
insufficient funds and any similar fees (excluding Prepayment Premiums or Yield
Maintenance Charges), in each case to the extent actually paid by a Mortgagor
with respect to a Mortgage Loan that is not a Specially Serviced Mortgage Loan,
and (ii) fifty percent (50%) of any assumption fee to the extent actually paid
by a Mortgagor with respect to any Mortgage Loan, may be retained by the Master
Servicer and are not required to be deposited in the Certificate Account. The
Master Servicer shall also be entitled to additional servicing compensation in
the form of (i) Prepayment Interest Excesses (but only insofar as the aggregate
of such Prepayment Interest Excesses collected during any Collection Period
exceeds the aggregate amount of Prepayment Interest Shortfalls incurred during
such Collection Period); (ii) interest or other income earned on deposits in the
Certificate Account, the Interest Reserve Account and the Distribution Account,
in accordance with Section 3.06(b) (but only to the extent of the Net Investment
Earnings, if any, with respect to each such account for each Collection Period),
and (iii) to the extent not required to be paid to any Mortgagor under
applicable law or the terms of the related Mortgage Loan, any interest or other
income earned on deposits in the Reserve Accounts and Servicing Accounts
maintained thereby. The Master Servicer shall be required to pay out of its own
funds all expenses incurred by it in connection with its servicing activities
hereunder (including, without limitation, payment of any amounts due and owing
to any of its Sub-Servicers and the premiums for any blanket policy insuring
against hazard losses pursuant to Section 3.07(b)), if and to the extent such
expenses are not payable directly out of the Certificate Account, and the Master
Servicer shall not be entitled to reimbursement therefor except as expressly
provided in this Agreement.
(c) As compensation for its activities hereunder, the Special
Servicer shall be entitled to receive the Special Servicing Fee with respect to
each Specially Serviced Mortgage Loan and each REO Loan. As to each Specially
Serviced Mortgage Loan and REO Loan, the Special Servicing Fee shall accrue from
time to time at the Special Servicing Fee Rate on the same principal amount
respecting which the related interest payment due on such Mortgage Loan or
deemed to be due on such REO Loan is computed and calculated on the basis of a
360-day year consisting of twelve 30-day months (or, in the event of a Principal
Prepayment in full or other Liquidation Event with respect to a Mortgage Loan or
REO Loan, on the basis of the actual number of days to elapse from and including
the related Due Date to but excluding the date of such Principal Prepayment or
Liquidation Event in a month consisting of 30 days). The Special Servicing Fee
with respect to any Specially Serviced
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Mortgage Loan or REO Loan shall cease to accrue as of the date a Liquidation
Event occurs in respect thereof or it becomes a Corrected Mortgage Loan. Earned
but unpaid Special Servicing Fees shall be payable monthly out of general
collections on the Mortgage Loans and any REO Properties on deposit in the
Certificate Account pursuant to Section 3.05(a).
In addition, with respect to each Specially Serviced Mortgage Loan,
Corrected Mortgage Loan and REO Loan, the Special Servicer shall be entitled to
the Principal Recovery Fee payable out of, and equal to 0.25% of, all amounts
(whether in the form of payments, Insurance Proceeds, Liquidation Proceeds or
REO Revenues) received in respect of such Mortgage Loan (or, in the case of an
REO Loan, in respect of the related REO Property) and allocable as a recovery of
principal in accordance with Section 3.02(b) or the definition of "REO Loan", as
applicable; provided that no Principal Recovery Fee shall be payable in
connection with, or out of Liquidation Proceeds resulting from, the purchase of
any Mortgage Loan or REO Property by the applicable Mortgage Loan Seller
pursuant to the respective Mortgage Loan Purchase Agreement, by the Majority
Subordinate Certificateholder pursuant to Section 3.18(b), by the Master
Servicer or the Special Servicer pursuant to Section 3.18(c) or by the
Depositor, the Master Servicer, Lehman Brothers Inc., the Special Servicer or
the Majority Subordinate Certificateholder pursuant to Section 9.01; provided
further that if any Person is acting as Special Servicer at such time as any
Specially Serviced Mortgage Loan became a Corrected Mortgage Loan and such
Person is subsequently terminated as Special Servicer hereunder, and if such
Corrected Mortgage Loan was still a Corrected Mortgage Loan at the time of such
termination, then such Person shall, following such termination, continue to be
entitled to all Principal Recovery Fees payable in respect to such Corrected
Mortgage Loan, and no successor Special Servicer shall be entitled to any
Principal Recovery Fees payable in respect thereof, in either case unless and
until such Corrected Mortgage Loan again becomes a Specially Serviced Mortgage
Loan or becomes an REO Loan; and provided further that if any Person is
terminated as Special Servicer hereunder while the sale of any Specially
Serviced Mortgage Loan or REO Property is pending, then (subject to the second
preceding proviso) such Person shall be entitled to all, and the successor
Special Servicer shall be entitled to none, of the Principal Recovery Fee
payable in connection with the receipt of the Liquidation Proceeds derived from
such sale.
As compensation for its activities set forth in Section 3.12, the
Special Servicer shall be entitled to receive the Additional Servicing Fee with
respect to each Mortgage Loan and REO Loan. As to each such Mortgage Loan and
REO Loan, the Additional Servicing Fee, shall accrue at the Additional Servicing
Fee Rate on the same principal amount respecting which the related interest
payment due on such Mortgage Loan or deemed to be due on such REO Loan is
computed and calculated on the basis of a 360-day year consisting of twelve
30-day months (or, in the event of a Principal Prepayment in full or other
Liquidation Event with respect to a Mortgage Loan or REO Loan, on the basis of
the actual number of days to elapse from and including the related Due Date to
but excluding the date of such Principal Prepayment or Liquidation Event in a
month consisting of 30 days). The Additional Servicing Fee with respect to any
Mortgage Loan or REO Loan shall cease to accrue if a Liquidation Event occurs in
respect thereof. Earned but unpaid Additional Servicing Fees shall be payable
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monthly, on a loan-by-loan basis, from payments of interest on each Mortgage
Loan and REO Revenues allocable as interest on each REO Loan. The Special
Servicer shall be entitled to recover unpaid Additional Servicing Fees, in
respect of any Mortgage Loan or REO Loan out of that portion of related
Insurance Proceeds or Liquidation Proceeds allocable as recoveries of interest,
to the extent permitted by Section 3.05(a)(iii).
The Special Servicer's right to receive the Special Servicing Fee,
the Additional Servicing Fee and the Principal Recovery Fee may not be
transferred in whole or in part except in connection with the transfer of all of
the Special Servicer's responsibilities and obligations under Sections 6.02,
6.04 and 6.09.
(d) Additional servicing compensation in the form of (i) late
charges received on or with respect to Specially Serviced Mortgage Loans, (ii)
fifty percent (50%) of assumption fees collected on all Mortgage Loans and (iii)
one hundred percent (100%) of modification fees collected on all Mortgage Loans
(other than modifications made by the Master Servicer pursuant to Section
3.20(i)), in each case to the extent actually paid by the related Mortgagor,
shall be retained by the Special Servicer or promptly paid to the Special
Servicer by the Master Servicer and shall not be required to be deposited in the
Certificate Account pursuant to Section 3.04(a). The Special Servicer shall also
be entitled to additional servicing compensation in the form of: (i) interest or
other income earned on deposits in the REO Account, if established, in
accordance with Section 3.06(b) (but only to the extent of the Net Investment
Earnings, if any, with respect to the REO Account for each Collection Period);
and (ii) to the extent not required to be paid to any Mortgagor under applicable
law, any interest or other income earned on deposits in the Servicing Accounts
maintained by the Special Servicer. The Special Servicer shall be required to
pay out of its own funds all expenses incurred by it in connection with its
servicing activities hereunder (including, without limitation, payment of any
amounts due and owing to any of its Sub-Servicers and the premiums for any
blanket policy obtained by it insuring against hazard losses pursuant to Section
3.07(b)), and the Special Servicer shall be entitled to reimbursement therefor
as expressly provided in Section 3.05(a) if and to the extent such expenses are
not payable directly out of the Certificate Account or the REO Account.
SECTION 3.12. Property Inspections; Collection of Financial
Statements; Delivery of Certain Reports.
(a) The Special Servicer shall at its expense perform or cause to be
performed a physical inspection of a Mortgaged Property as soon as practicable
after a related Mortgage Loan becomes a Specially Serviced Mortgage Loan. The
Master Servicer shall at its expense perform or cause to be performed an
inspection of all the Mortgaged Properties at least once per calendar year (or,
in the case of Mortgage Loans with a Cut-off Date Principal Balance of less than
$2,000,000, every other calendar year) beginning in 1999. The Special Servicer
and the Master Servicer shall each prepare (and, in the case of the Special
Servicer, shall deliver to the Master Servicer) a written report of each such
inspection performed by it that sets forth in detail the condition of the
Mortgaged Property and that specifies the existence
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of: (i) any sale, transfer or abandonment of the Mortgaged Property of which the
Special Servicer is aware, (ii) any change in the condition or value of the
Mortgaged Property that it, in its reasonable judgment, considers material, or
(iii) any waste committed on the Mortgaged Property. The Master Servicer shall
make copies of all such inspection reports available for review by
Certificateholders and Certificate Owners during normal business hours at the
offices of the Master Servicer at all times after a date no later than 30 days
of the related inspection. The Master Servicer shall forward copies of any such
inspection reports to Lehman Brothers Inc. upon request. The Special Servicer
shall have the right to inspect or cause to be inspected (at its own expense)
every calendar year any Mortgaged Property related to a loan that is not a
Specially Serviced Mortgage Loan, provided that the Special Servicer notifies
the Master Servicer prior to such inspection, and provides a copy of such
inspection to the Master Servicer. If the Special Servicer performs such
inspection such inspection shall satisfy the Master Servicer's inspection
obligations pursuant to this paragraph (a).
With respect to site inspection information, the Master Servicer
shall make such inquiry of any Mortgager under any related Mortgage Loan as the
Special Servicer may reasonably request.
The Special Servicer will, promptly after a Mortgage Loan becomes a
Specially Serviced Mortgage Loan, give written notice to the Master Servicer and
the Trustee which will include an explanation as to the reasons such Mortgage
Loan became a Specially Serviced Mortgage Loan and the Special Servicer's plan
for servicing such Mortgage Loan, a copy of which notice will be provided by the
Trustee to each Certificateholder, each Rating Agency, the Depositor and Lehman
Brothers Inc.
(b) Not later than 2:00 p.m. (New York City time) on the second
Business Day prior to each Determination Date, the Special Servicer shall
deliver or cause to be delivered to the Master Servicer the following reports
with respect to the Mortgage Loans (and, if applicable, the related REO
Properties) providing the required information as of the end of the preceding
calendar month: (i) a CSSA Property File Report; (ii) a Comparative Financial
Status Report; (iii) a NOI Adjustment Worksheet and (iv) an Operating Statement
Analysis. Not later than 2:00 p.m. (New York City time) on the second Business
Day following each Determination Date, the Special Servicer shall deliver or
cause to be delivered to the Master Servicer the following reports with respect
to the Mortgage Loans (and, if applicable, the related REO Properties) providing
the required information as of such Determination Date: (i) a Historical Loss
Estimate Report; (ii) a Historical Loan Modification Report; (iii) an REO Status
Report; and (iv) a Watch List Report.
(c) Not later than 2:00 p.m. (New York City time) on the third
Business Day after each Determination Date, the Master Servicer shall deliver or
cause to be delivered to the Trustee (in electronic format acceptable to the
Master Servicer and the Trustee) (A) the following reports with respect to the
Mortgage Loans (and, if applicable, the related REO Properties) providing the
required information as of the end of the preceding calendar month: (i) the CSSA
Property File Report received from the Special Servicer pursuant to Section
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3.12(b), (ii) the Comparative Financial Status Report received from the Special
Servicer pursuant to Section 3.12(b); (iii) the NOI Adjustment Worksheet
received from the Special Servicer pursuant to Section 3.12(b) and (iv) the
Operating Statement Analysis received from the Special Servicer pursuant to
Section 3.12(b) and (B) the following reports with respect thereto providing the
required information as of such Determination Date: (i) the Delinquent Loan
Status Report; (ii) the Historical Loss Estimate Report received from the
Special Servicer pursuant to Section 3.12(b); (iii) the Historical Loan
Modification Report received from the Special Servicer pursuant to Section
3.12(b); (iv) the REO Status Report received from the Special Servicer pursuant
to Section 3.12(b); (v) a Watch List Report; and (vi) a Loan Payoff Notification
Report.
(d) The Special Servicer will deliver to the Master Servicer the
reports set forth in Section 3.12(b) and the Master Servicer shall deliver to
the Trustee the reports set forth in Section 3.12 in an electronic format
reasonably acceptable to the Special Servicer and the Master Servicer with
respect to the reports set forth in Section 3.12(b), and the Master Servicer and
the Trustee with respect to the reports set forth in Section 3.12(c). The Master
Servicer may, absent manifest error, conclusively rely on the reports to be
provided by the Special Servicer pursuant to Section 3.12(b). The Trustee may,
absent manifest error, conclusively rely on the CSSA Loan File Report to be
provided by the Master Servicer pursuant to Section 4.02(b). In the case of
information or reports to be furnished by the Master Servicer to the Trustee
pursuant to Section 3.12(c), to the extent that such information is based on
reports to be provided by the Special Servicer pursuant to Section 3.12(b) and
to the extent that such reports are to be prepared and delivered by the Special
Servicer pursuant to Section 3.12(b), the Master Servicer shall have no
obligation to provide such information or reports until it has received such
information or reports from the Special Servicer and the Master Servicer shall
not be in default hereunder due to a delay in providing the reports required by
Section 3.12(c) caused by the Special Servicer's failure to timely provide any
report required under Section 3.12(b) of this Agreement.
The Special Servicer shall, consistent with the Servicing Standard,
endeavor to obtain quarterly and annual operating statements and rent rolls with
respect to each of the Mortgage Loans and REO Properties, which efforts shall
include in the case of Mortgage Loans, a letter sent to the related Mortgagor
each quarter (followed up with telephone calls) requesting such quarterly and
annual operating statements and rent rolls until they are received to the extent
such action is consistent with applicable law. With respect to each Mortgaged
Property and REO Property the Special Servicer will prepare and deliver an
Operating Statement Analysis as set forth in Section 3.12(b) for the related
Mortgaged Property or REO Property for or as of the end the prior calendar month
together with copies of the operating statements and rent rolls for the related
Mortgaged Property or REO Property.
Within ten days after receipt by the Special Servicer of any annual
operating statements with respect to any Mortgaged Property or REO Property, the
Special Servicer shall prepare or update an NOI Adjustment Worksheet for such
Mortgaged Property or REO Property (with the annual operating statements
attached thereto as an exhibit).
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The Special Servicer shall maintain one Operating Statement Analysis
report for each Mortgaged Property and REO Property. The Operating Statement
Analysis report for each Mortgaged Property is to be updated by the Special
Servicer and such updated report shall be delivered in electronic format to the
Master Servicer pursuant to Section 3.12(b). The Special Servicer will use the
"Normalized" column from the NOI Adjustment Worksheet to update the Operating
Statement Analysis report and will use any operating statements received with
respect to any Mortgaged Property to update the Operating Statement Analysis
report for such Mortgaged Property, such updates to be completed in electronic
format and delivered to the Master Servicer within 30 days of completion.
SECTION 3.13. Annual Statement as to Compliance.
Each of the Master Servicer and the Special Servicer shall deliver
to the Trustee, the Underwriters, and the Rating Agencies, and, in the case of
the Special Servicer, to the Master Servicer, on or before April 30 of each
year, beginning April 30, 1999, an Officers' Certificate stating, as to each
signer thereof, that (i) a review of the activities of the Master Servicer or
the Special Servicer, as the case may be, during the preceding calendar year and
of its performance under this Agreement has been made under such officer's
supervision, (ii) to the best of such officer's knowledge, based on such review,
the Master Servicer or the Special Servicer, as the case may be, has fulfilled
all of its obligations under this Agreement in all material respects throughout
such year, or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the nature
and status thereof and (iii) the Master Servicer or the Special Servicer, as the
case may be, has received no notice regarding qualification, or challenging the
status, of REMIC I, REMIC II or REMIC III as a REMIC under the REMIC Provisions
or of the Grantor Trust as a "grantor trust" under the Grantor Trust Provisions
from the Internal Revenue Service or any other governmental agency or body or,
if it has received any such notice, specifying the details thereof. The Master
Servicer and Special Servicer shall deliver a copy of such Officer's Certificate
to the Depositor.
SECTION 3.14. Reports by Independent Public Accountants.
On or before April 30 of each year, beginning April 30, 1999 each of
the Master Servicer and the Special Servicer at its expense shall cause a firm
of Independent public accountants (which may also render other services to the
Master Servicer or the Special Servicer) that is a member of the American
Institute of Certified Public Accountants to furnish a statement to the Trustee,
Underwriters, Rating Agencies, Depositor and, in the case of the Special
Servicer, to the Master Servicer to the effect that such firm has examined the
servicing operations of the Master Servicer or the Special Servicer, as the case
may be, for the previous calendar year (except that the first such report shall
cover the period from the Closing Date through December 31, 1998) and that, on
the basis of such examination, conducted substantially in compliance with USAP,
such firm confirms that the Master Servicer or the Special Servicer, as the case
may be, complied with the minimum servicing standards identified in USAP, in all
material respects, except for such significant exceptions or errors in
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records that, in the opinion of such firm, the USAP requires it to report. In
rendering such statement, such firm may rely, as to matters relating to direct
servicing of mortgage loans by Sub-Servicers, upon comparable statements for
examinations conducted substantially in compliance with the Uniform Single Audit
Program for Mortgage Bankers (rendered within one year of such statement) of
independent public accountants with respect to the related Sub-Servicer.
SECTION 3.15. Access to Certain Information.
(a) Upon ten days prior written notice, the Master Servicer (with
respect to the items in clauses (a), (b), (c), (d) and (i) below), the Special
Servicer (with respect to the items in clauses (d), (e), (f), (g), (i) and (j)
below) and the Trustee (with respect to the items in clause (h) below and to the
extent any other items are in its possession) shall make available at their
respective offices primarily responsible for administration of the Mortgage
Loans (or in the case of Norwest Bank Minnesota, National Association, at its
Corporate Trust Office, except with respect to item (g), which will be
maintained at its offices in New York or Minnesota), during normal business
hours, for review by any Certificate Owner or Certificateholder or any person
identified by a Certificate Owner or Certificateholder or its designated agent
to the Trustee, the Master Servicer or the Special Servicer, as the case may be,
as a prospective transferee of any Certificate or interest therein, the Trustee,
the Rating Agencies, the Underwriters and anyone specified thereby and the
Depositor originals or copies of the following items: (a) this Agreement and any
amendments thereto, (b) all Distribution Date Statements delivered to holders of
the relevant Class of Certificates since the Closing Date and all reports,
statements and analyses delivered by the Master Servicer since the Closing Date
pursuant to Section 3.12(c), (c) all Officers' Certificates delivered by the
Master Servicer or the Special Servicer since the Closing Date pursuant to
Section 3.13, (d) all accountants' reports delivered to the Master Servicer in
respect of itself or the Special Servicer since the Closing Date as described in
Section 3.14, (e) the most recent property inspection report prepared by or on
behalf of the Special Servicer in respect of each Mortgaged Property and
delivered to the Master Servicer, (f) the most recent Mortgaged Property annual
operating statements and rent roll, if any, collected by or on behalf of the
Special Servicer and delivered to the Master Servicer, (g) any and all
modifications, waivers and amendments of the terms of a Mortgage Loan entered
into by the Special Servicer, (h) the Servicing File relating to each Mortgage
Loan, (i) any and all Officers' Certificates and other evidence delivered by the
Master Servicer or the Special Servicer, as the case may be, to support its
determination that any Advance was or, if made, would be a Nonrecoverable
Advance, and (j) any operating statements, budgets, rent rolls or financial
statements. Copies of any and all of the foregoing items will be available from
the Master Servicer or the Special Servicer, as the case may be, upon request
and shall be provided to any of the Rating Agencies and Lehman Brothers Inc. at
no cost pursuant to any of their requests.
In connection with providing access to or copies of the items
described in the preceding paragraph pursuant to this Section 3.15, the Trustee
shall require: (a) in the case of Certificate Owners, a confirmation executed by
the requesting Person substantially in the form
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of Exhibit X-1 hereto (or such other form as may be reasonably acceptable to the
Trustee) generally to the effect that such Person is a beneficial holder of
Book-Entry Certificates and, subject to the last sentence of this paragraph,
will keep such information confidential (except that such Certificate Owner may
provide such information to any other Person that holds or is contemplating the
purchase of any Certificate or interest therein, provided that such other Person
confirms in writing such ownership interest or prospective ownership interest
and agrees to keep such information confidential); and (b) in the case of a
prospective purchaser of a Certificate or an interest therein, confirmation
executed by the requesting Person substantially in the form of Exhibit X-2
hereto (or such other form as may be reasonably acceptable to the Trustee)
generally to the effect that such Person is a prospective purchaser of a
Certificate or an interest therein, is requesting the information for use in
evaluating a possible investment in Certificates and, subject to the last
sentence of this paragraph, will otherwise keep such information confidential.
The Holders of the Certificates, by their acceptance thereof, will be deemed to
have agreed, subject to the last sentence of this paragraph, to keep such
information confidential (except that any Holder may provide such information
obtained by it to any other Person that holds or is contemplating the purchase
of any Certificate or interest therein, provided that such other Person confirms
in writing such ownership interest or prospective ownership interest and agrees
to keep such information confidential). Notwithstanding the foregoing, no
Certificateholder, Certificate Owner or prospective Certificateholder or
Certificate Owner shall be obligated to keep confidential any information
received from the Trustee pursuant to this Section 3.15 that has previously been
made available via the Trustee's internet website or has previously been filed
with the Commission, and the Trustee shall not require either of the
certifications contemplated by the second preceding sentence in connection with
providing any information pursuant to this Section 3.15 that has previously been
made available via the Trustee's Internet Website or has previously been filed
with the Commission.
Each of the Master Servicer and the Special Servicer shall afford to
the Trustee, Lehman Brothers Inc., the Rating Agencies and the Depositor, and to
the OTS, the FDIC and any other banking or insurance regulatory authority that
may exercise authority over any Certificateholder, access to any records
regarding the Mortgage Loans and the servicing thereof within its control,
except to the extent it is prohibited from doing so by applicable law or
contract or to the extent such information is subject to a privilege under
applicable law to be asserted on behalf of the Certificateholders. Such access
shall be afforded only upon reasonable prior written request and during normal
business hours at the offices of the Master Servicer or the Special Servicer, as
the case may be, designated by it.
The Trustee, the Master Servicer, the Special Servicer and the
Underwriters may require payment from the Certificateholder of a sum sufficient
to cover the reasonable costs and expenses of providing any such information or
access pursuant to this Section 3.15 to, or at the request of, the
Certificateholders or prospective transferees, including, without limitation,
copy charges and reasonable fees for employee time and for space.
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(b) The Trustee will make available each month, to any interested
party (i) the Distribution Date Statement via the Trustee's Internet Website,
electronic bulletin board and fax-on-demand service and (ii) as a convenience
for interested parties (and not in furtherance of the distribution of the
Prospectus or the Prospectus Supplement under the securities laws), the
Prospectus, the Prospectus Supplement and this Agreement on the Trustee's
Internet Website. In addition, the Trustee will and the Master Servicer may but
is not required to make available each month the Distribution Date Statement and
the Unrestricted Servicer Reports, the CSSA Loan File Report and the CSSA loan
setup file on their respective internet websites. The Trustee will make
available each month, and the Master Servicer may but shall not be required to
make available each month, the Restricted Servicer Reports, and the CSSA
Property File Report to any Privileged Person via the Trustee's and the Master
Servicer's respective Internet Websites with the use of a password provided by
the Trustee or the Master Servicer to such Privileged Person upon receipt by the
Trustee or the Master Servicer from such Person of a certification in the form
of Exhibit K; provided that the Rating Agencies, the Depositor, the parties
hereto and the Underwriters will not need to provide such certification to
receive a password from the Trustee. In connection with providing access to the
Trustee's internet website or electronic bulletin board or the Master Servicer's
internet website, the Trustee or the Master Servicer, as applicable, may require
registration and the acceptance of a disclaimer.
If three or more Holders (hereinafter referred to as "Applicants"
with a single Person which (together with its Affiliates) is the Holder of more
than one Class of Certificates being viewed as a single Applicant for these
purposes) apply in writing to the Trustee, and such application states that the
Applicants' desire to communicate with other Holders with respect to their
rights under this Agreement or under the Certificates and is accompanied by a
copy of the communication which such Applicants propose to transmit, then the
Trustee shall, within five Business Days after the receipt of such application,
send, at the Applicants' expense, the written communication proffered by the
Applicants to all Certificateholders at their addresses as they appear in the
Certificate Register.
SECTION 3.16. Title to REO Property; REO Account.
(a) If title to any REO Property is acquired, the deed or
certificate of sale shall be issued to the Trustee or its nominee on behalf of
the Certificateholders. The Special Servicer, on behalf of the Trust Fund, shall
sell any REO Property by the end of the third year following the calendar year
in which REMIC I acquires ownership of such REO Property for purposes of Section
860G(a)(8) of the Code, unless the Special Servicer either (i) applies for, more
than sixty days prior to the end of such third succeeding year, and is granted
an extension of time (an "REO Extension") by the Internal Revenue Service to
sell such REO Property or (ii) obtains for the Trustee an Opinion of Counsel,
addressed to the Trustee, the Special Servicer and the Master Servicer, to the
effect that the holding by REMIC I of such REO Property subsequent to the end of
such third succeeding year will not result in the imposition of taxes on
"prohibited transactions" (as defined in Section 860F of the Code) of any of
REMIC I, REMIC II or REMIC III or cause any of REMIC I, REMIC II or REMIC III
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to fail to qualify as a REMIC at any time that any Certificates are outstanding.
If the Special Servicer is granted the REO Extension contemplated by clause (i)
of the immediately preceding sentence or obtains the Opinion of Counsel
contemplated by clause (ii) of the immediately preceding sentence, the Special
Servicer shall sell such REO Property within such extended period as is
permitted by such REO Extension or such Opinion of Counsel, as the case may be.
Any expense incurred by the Special Servicer in connection with its obtaining
the REO Extension contemplated by clause (i) of the second preceding sentence or
its obtaining the Opinion of Counsel contemplated by clause (ii) of the second
preceding sentence, shall be an expense of the Trust Fund payable out of the
Certificate Account pursuant to Section 3.05(a).
(b) The Special Servicer shall segregate and hold all funds
collected and received in connection with any REO Property separate and apart
from its own funds and general assets. If an REO Acquisition shall occur, the
Special Servicer shall establish and maintain one or more accounts
(collectively, the "REO Account"), held on behalf of the Trustee in trust for
the benefit of the Certificateholders, for the retention of revenues and other
proceeds derived from each REO Property. The REO Account shall be an Eligible
Account. The Special Servicer shall deposit, or cause to be deposited, in the
REO Account, upon receipt, all REO Revenues, Insurance Proceeds and Liquidation
Proceeds received in respect of an REO Property. Funds in the REO Account may be
invested in Permitted Investments in accordance with Section 3.06. The Special
Servicer shall be entitled to make withdrawals from the REO Account to pay
itself, as additional servicing compensation in accordance with Section 3.11(d),
interest and investment income earned in respect of amounts held in the REO
Account as provided in Section 3.06(b) (but only to the extent of the Net
Investment Earnings with respect to the REO Account for any Collection Period).
The Special Servicer shall give written notice to the Trustee and the Master
Servicer of the location of the REO Account when first established and of the
new location of the REO Account prior to any change thereof.
(c) The Special Servicer shall withdraw from the REO Account funds
necessary for the proper operation, management, maintenance and disposition of
any REO Property, but only to the extent of amounts on deposit in the REO
Account relating to such REO Property (including any monthly reserve or escrow
amounts necessary to accumulate sufficient funds for taxes, insurance and
anticipated capital expenditures (the "Impound Reserve")). On each Determination
Date, the Special Servicer shall withdraw from the REO Account and deposit into
the Certificate Account or deliver to the Master Servicer or such other Person
as may be directed by the Master Servicer (which shall deposit such amounts into
the Certificate Account) the aggregate of all amounts received in respect of
each REO Property during the most recently ended Collection Period, net of any
withdrawals made out of such amounts pursuant to the preceding sentence;
provided that in addition to the Impound Reserve the Special Servicer may retain
in the REO Account such portion of proceeds and collections as may be necessary
to maintain a reserve of sufficient funds for the proper operation, management
and maintenance of the related REO Property (including without limitation the
creation of a reasonable reserve for repairs, replacements and other related
expenses), such reserve not to exceed $10,000 with respect to each such REO
Property or to cover a period of more than twelve months.
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(d) The Special Servicer shall keep and maintain separate records,
on a property-by-property basis, for the purpose of accounting for all deposits
to, and withdrawals from, the REO Account pursuant to Section 3.16(b) or (c).
The Special Servicer shall provide the Master Servicer any information with
respect to the REO Account as is reasonably requested by the Master Servicer.
SECTION 3.17. Management of REO Property.
(a) Prior to the acquisition of title to a Mortgaged Property, the
Special Servicer shall review the operation of such Mortgaged Property and
determine the nature of the income that would be derived from such property if
it were acquired by the Trust Fund. If the Special Servicer determines from such
review that:
(i) None of the income from Directly Operating such Mortgaged
Property would be subject to tax as "net income from foreclosure
property" within the meaning of the REMIC Provisions or would be
subject to the tax imposed on "prohibited transactions" under
Section 860F of the Code (either such tax referred to herein as an
"REO Tax"), such Mortgaged Property may be Directly Operated by the
Special Servicer as REO Property;
(ii) Directly Operating such Mortgaged Property as an REO
Property could result in income from such property that would be
subject to an REO Tax, but that a lease of such property to another
party to operate such property, or the performance of some services
by an Independent Contractor with respect to such property, or
another method of operating such property would not result in income
subject to an REO Tax, then the Special Servicer may (provided, that
in the good faith and reasonable judgment of the Special Servicer,
it is commercially feasible) acquire such Mortgaged Property as REO
Property and so lease or operate such REO Property; or
(iii) It is reasonable to believe that Directly Operating such
property as REO Property could result in income subject to an REO
Tax and that no commercially feasible means exists to operate such
property as REO Property without the Trust Fund incurring or
possibly incurring an REO Tax on income from such property, the
Special Servicer shall deliver to the REMIC Administrator, in
writing, a proposed plan (the "Proposed Plan") to manage such
property as REO Property. Such plan shall include potential sources
of income, and to the extent commercially feasible, estimates of the
amount of income from each such source. Within a reasonable period
of time after receipt of such plan, the REMIC Administrator shall
consult with the Special Servicer and shall advise the Special
Servicer of the REMIC Administrator's federal income tax reporting
position with respect to the various sources of income that the
Trust Fund would derive under the Proposed Plan. In addition, the
REMIC Administrator shall (to the extent reasonably possible) advise
the Special
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Servicer of the estimated amount of taxes that the Trust Fund would
be required to pay with respect to each such source of income. After
receiving the information described in the two preceding sentences
from the REMIC Administrator, the Special Servicer shall either (A)
implement the Proposed Plan (after acquiring the respective
Mortgaged Property as REO Property) or (B) manage and operate such
property in a manner that would not result in the imposition of an
REO Tax on the income derived from such property. All of the REMIC
Administrator's expenses (including any fees and expenses of counsel
or other experts reasonably retained by it) incurred pursuant to
this section shall be reimbursed to it from the Trust Fund in
accordance with Section 10.01(f).
The Special Servicer's decision as to how each REO Property shall be
managed and operated shall be based on the Servicing Standard and in any case on
the good faith and reasonable judgment of the Special Servicer as to which means
would be in the best interest of the Certificateholders by maximizing (to the
extent commercially feasible and consistent with Section 3.17(b)) the net
after-tax REO Revenues received by the Trust Fund with respect to such property
and, to the extent consistent with the foregoing, in the same manner as would
prudent mortgage loan servicers and asset managers operating acquired mortgaged
property comparable to the respective Mortgaged Property. Both the Special
Servicer and the REMIC Administrator may, at the expense of the Trust Fund
payable pursuant to Section 3.05(a)(xiii) consult with counsel.
(b) If title to any REO Property is acquired, the Special Servicer
shall manage, conserve, protect and operate such REO Property for the benefit of
the Certificateholders solely for the purpose of its prompt disposition and sale
in a manner that does not and will not cause such REO Property to fail to
qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code or, except as contemplated by Section 3.17(a), either result in the
receipt by REMIC I, REMIC II or REMIC III of any "income from non-permitted
assets" within the meaning of Section 860F(a)(2)(B) of the Code or result in an
Adverse REMIC Event. Subject to the foregoing, however, the Special Servicer
shall have full power and authority to do any and all things in connection
therewith as are consistent with the Servicing Standard and, consistent
therewith, shall withdraw from the REO Account, to the extent of amounts on
deposit therein with respect to any REO Property, funds necessary for the proper
operation, management, maintenance and disposition of such REO Property,
including without limitation:
(i) all insurance premiums due and payable in respect of such
REO Property;
(ii) all real estate taxes and assessments in respect of such
REO Property that may result in the imposition of a lien thereon;
(iii) any ground rents in respect of such REO Property; and
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(iv) all costs and expenses necessary to maintain, lease,
sell, protect, manage, operate and restore such REO Property.
To the extent that amounts on deposit in the REO Account in respect of any REO
Property are insufficient for the purposes set forth in the preceding sentence
with respect to such REO Property, the Special Servicer shall make Servicing
Advances in such amounts as are necessary for such purposes unless (as evidenced
by an Officers' Certificate delivered to the Trustee and the Master Servicer)
the Special Servicer would not make such advances if the Special Servicer owned
such REO Property or the Special Servicer determines, in accordance with the
Servicing Standard, that such payment would be a Nonrecoverable Advance;
provided, however, that the Special Servicer may make any such Servicing Advance
without regard to recoverability if it is a necessary fee or expense incurred in
connection with the defense or prosecution of legal proceedings.
(c) The Special Servicer may contract with any Independent
Contractor for the operation and management of any REO Property, provided that:
(i) the terms and conditions of any such contract may not be
inconsistent herewith and shall reflect an agreement reached at
arm's length;
(ii) the fees of such Independent Contractor (which shall be
expenses of the Trust Fund) shall be reasonable and customary in
consideration of the nature and locality of the REO Property;
(iii) except as permitted under Section 3.17(a), any such
contract shall require, or shall be administered to require, that
the Independent Contractor, in a timely manner, (A) pay all costs
and expenses incurred in connection with the operation and
management of such REO Property, including, without limitation,
those listed in Section 3.17(b) above, and (B) except to the extent
that such revenues are derived from any services rendered by the
Independent Contractor to tenants of the REO Property that are not
customarily furnished or rendered in connection with the rental of
real property (within the meaning of Section 1.856-4(b)(5) of the
Treasury Regulations or any successor provision), remit all related
revenues collected (net of its fees and such costs and expenses) to
the Special Servicer upon receipt;
(iv) none of the provisions of this Section 3.17(c) relating
to any such contract or to actions taken through any such
Independent Contractor shall be deemed to relieve the Special
Servicer of any of its duties and obligations hereunder with respect
to the operation and management of any such REO Property; and
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(v) the Special Servicer shall be obligated with respect
thereto to the same extent as if it alone were performing all duties
and obligations in connection with the operation and management of
such REO Property.
The Special Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of the Special Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify such indemnification. No agreement entered into pursuant to this
Section 3.17(c) shall be deemed a Sub-Servicing Agreement for purposes of
Section 3.22.
SECTION 3.18. Sale of Mortgage Loans and REO Properties.
(a) The Master Servicer, the Special Servicer or the Trustee may
sell or purchase, or permit the sale or purchase of, a Mortgage Loan or REO
Property only on the terms and subject to the conditions set forth in this
Section 3.18 or as otherwise expressly provided in or contemplated by Sections
2.03(a), 2.02(b) and 9.01.
(b) Subject to Sections 2.03(a) and 2.02(b), if the Special Servicer
has determined in good faith that any Defaulted Mortgage Loan will become
subject to foreclosure proceedings, the Special Servicer shall promptly so
notify in writing the Trustee and the Master Servicer, and the Trustee,
following its receipt of such notice, shall, within 10 days after receipt of
such notice, notify the Majority Subordinate Certificateholder. The Majority
Subordinate Certificateholder may at its option purchase from the Trust Fund, at
a price equal to the Purchase Price, any such Mortgage Loan. The Purchase Price
for any Mortgage Loan purchased under this paragraph (b) shall be deposited into
the Certificate Account, and the Custodian, upon receipt of an Officers'
Certificate from the Master Servicer to the effect that such deposit has been
made, shall release or cause to be released to the Majority Subordinate
Certificateholder the related Mortgage File, and shall execute and deliver such
instruments of transfer or assignment, in each case without recourse, as shall
be provided to it and are reasonably necessary to vest in the Majority
Subordinate Certificateholder ownership of such Mortgage Loan. In connection
with any such purchase, the Special Servicer shall deliver the related Servicing
File to the Majority Subordinate Certificateholder.
(c) If the Majority Subordinate Certificateholder has not purchased
any Defaulted Mortgage Loan within 30 days of its having received notice in
respect thereof pursuant to Section 3.18(b) above, either the Master Servicer or
the Special Servicer (with preference given to the Special Servicer) may at its
option purchase such Mortgage Loan from the Trust Fund, at a price equal to the
Purchase Price. The Purchase Price for any such Mortgage Loan purchased under
this paragraph (c) shall be deposited into the Certificate Account, and the
Custodian, upon receipt of an Officers' Certificate from the Master Servicer to
the effect that such deposit has been made, shall release or cause to be
released to the Master Servicer or the Special Servicer, as applicable, the
related Mortgage File, and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse,
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as shall be provided to it and are reasonably necessary to vest in the Master
Servicer or the Special Servicer, as applicable, the ownership of such Mortgage
Loan. In connection with any such purchase by the Master Servicer, the Special
Servicer shall deliver the related Servicing File to the Master Servicer.
(d) Subject to Section 6.11, the Special Servicer may offer to sell
any Defaulted Mortgage Loan not otherwise purchased pursuant to Sections 3.18(b)
and 3.18(c) above, if and when the Special Servicer determines, consistent with
the Servicing Standard, that such a sale would be in the best economic interests
of the Trust Fund. Such offer shall be made in a commercially reasonable manner
(which, for purposes hereof, includes an offer to sell without representation or
warranty other than customary warranties of title and condition, if liability
for breach thereof is limited to recourse against the Trust Fund) for a period
of not less than 10 days. Unless the Special Servicer determines that acceptance
of any bid would not be in the best economic interests of the
Certificateholders, the Special Servicer shall accept the highest cash bid
received from any Person that constitutes a fair price for such Mortgage Loan.
In the absence of any bid determined as provided below to be fair, the Special
Servicer shall proceed with respect to such Defaulted Mortgage Loan in
accordance with Section 3.09.
Subject to Section 6.11, the Special Servicer shall use its best
efforts to solicit bids for each REO Property in such manner as will be
reasonably likely to realize a fair price within the time period provided for by
Section 3.16(a). The Special Servicer shall accept the first (and, if multiple
bids are received contemporaneously or subsequently, the highest, provided that
the Special Servicer is not obligated to the first bidder) cash bid received
from any Person that constitutes a fair price for such REO Property. If the
Special Servicer reasonably believes that it will be unable to realize a fair
price for any REO Property within the time constraints imposed by Section
3.16(a), the Special Servicer shall dispose of such REO Property upon such terms
and conditions as the Special Servicer shall deem necessary and desirable to
maximize the recovery thereon under the circumstances and, in connection
therewith, shall accept the highest outstanding cash bid, regardless of from
whom received.
The Special Servicer shall give the Trustee and the Master Servicer
not less than three Business Days' prior written notice of its intention to sell
any Mortgage Loan or REO Property pursuant to this Section 3.18(d). No
Interested Person shall be obligated to submit a bid to purchase any such
Mortgage Loan or REO Property, and notwithstanding anything to the contrary
herein, neither the Trustee, in its individual capacity, nor any of its
Affiliates may bid for or purchase any Defaulted Mortgage Loan or any REO
Property pursuant hereto.
(e) Whether any cash bid constitutes a fair price for any Defaulted
Mortgage Loan or REO Property, as the case may be, for purposes of Section
3.18(d), shall be determined by the Special Servicer (except as otherwise
provided below in this Section 3.18(e)). In determining whether any bid received
from an Interested Person represents a fair price for any such Mortgage Loan or
REO Property, the Special Servicer shall be supplied with and may rely on a
narrative appraisal prepared at the expense of the Trust Fund by an Independent
Appraiser, retained by the Special Servicer. (The Special Servicer may rely on a
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certification of any bidder to the effect that such bidder is not an Interested
Person.) Such appraiser shall be selected by the Special Servicer if the Special
Servicer is not bidding with respect to a Defaulted Mortgage Loan or REO
Property and shall be selected by the Master Servicer if the Special Servicer is
bidding. (The Master Servicer shall not bid with respect to a Defaulted Mortgage
Loan or REO Property if the Special Servicer has informed it that the Special
Servicer intends to submit a bid.) Where any Interested Person is among those
bidding with respect to a Mortgage Loan or REO Property, the Special Servicer
shall require that all bids be submitted in writing and be accompanied by a
refundable deposit of cash in an amount equal to 5% of the bid amount. In
determining whether any bid from a Person other than an Interested Person or
from an Interested Person other than the Special Servicer constitutes a fair
price for any such Mortgage Loan or REO Property, the Special Servicer shall
take into account (in addition to the results of any appraisal described above
and any appraisal that it may have obtained pursuant to Section 3.09(a)), and
any appraiser or other expert in real estate matters shall be instructed to take
into account, as applicable, among other factors, the period and amount of any
delinquency on the affected Mortgage Loan, the occupancy level and physical
condition of the Mortgaged Property or REO Property, the state of the local
economy and the obligation to dispose of any REO Property within the time period
specified in Section 3.16(a). The Purchase Price for any such Mortgage Loan or
REO Property shall in all cases be deemed a fair price. Notwithstanding the
other provisions of this Section 3.18 (but excluding a purchase pursuant to
Section 3.18(c)), no cash bid from the Master Servicer, Special Servicer or any
of their Affiliates thereof shall constitute a fair price for any Defaulted
Mortgage Loan or REO Property unless such bid is the highest bid received and at
least two independent bids (not including the bid of the Master Servicer,
Special Servicer or any Affiliate) have been received. In the event the bid of
the Special Servicer or any Affiliate is the only bid received or is the higher
of only two bids received, then additional bids shall be solicited. If an
additional bid or bids are received and the original bid of the Special Servicer
or any Affiliate is the highest of all bids received, then the bid of the
Special Servicer or such Affiliate shall no longer be deemed not to constitute a
fair price.
(f) Subject to Sections 3.18(a) through 3.18(e) above and Section
6.11, the Special Servicer shall act on behalf of the Trustee in negotiating
with independent third parties and taking any other action necessary or
appropriate in connection with the sale of any Defaulted Mortgage Loan or REO
Property, and the collection of all amounts payable in connection therewith. In
connection therewith, the Special Servicer may charge prospective bidders, and
may retain, fees that approximate the Special Servicer's actual costs in the
preparation and delivery of information pertaining to such sales or evaluating
bids without obligation to deposit such amounts into the Certificate Account.
Any sale of a Defaulted Mortgage Loan or any REO Property shall be final,
without recourse to the Trustee or the Trust Fund and without representations
and warranties of title and condition, unless liability for breach thereof is
limited to recourse against the Trust Fund, and if such sale is consummated in
accordance with the terms of this Agreement, neither the Special Servicer nor
the Trustee shall have any liability to any Certificateholder with respect to
the purchase price therefor accepted by the Special Servicer or the Trustee.
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(g) Any sale of a Defaulted Mortgage Loan or any REO Property shall
be for cash only (unless changes in the REMIC Provisions or authoritative
interpretations thereof made or issued subsequent to the Startup Day allow a
sale for other consideration).
(h) The Special Servicer shall not be obligated by any of the
foregoing paragraphs of this Section 3.18 to accept the highest bid if the
Special Servicer determines, in accordance with the Servicing Standard, that
rejection of such bid would be in the best interests of the Certificateholders.
In addition, the Special Servicer may accept a lower bid if it determines, in
accordance with the Servicing Standard, that acceptance of such bid would be in
the best interests of the Certificateholders (for example, if the prospective
buyer making the lower bid is more likely to perform its obligations or the
terms offered by the prospective buyer making the lower bid are more favorable).
SECTION 3.19. Additional Obligations of Master Servicer and
Special Servicer.
(a) The Master Servicer shall deliver to the Paying Agent for
deposit in the Distribution Account on each P&I Advance Date, without any right
of reimbursement therefor, an amount equal to the lesser of (i) the excess, if
any, of (A) the aggregate amount of Prepayment Interest Shortfalls incurred in
connection with Principal Prepayments received during the most recently ended
Collection Period over (B) the aggregate amount of Prepayment Interest Excesses
collected in connection with Principal Prepayments received during such
Collection Period and (ii) the Master Servicing Fee received by the Master
Servicer during such Collection Period and all servicing compensation in respect
of Penalty Interest and late charges received by the Master Servicer during such
Collection Period.
(b) The Master Servicer shall, as to each Mortgage Loan which is
secured by the interest of the related Mortgagor under a Ground Lease, promptly
(and in any event within 60 days of the Closing Date) notify the related ground
lessor of the transfer of such Mortgage Loan to the Trust Fund pursuant to this
Agreement and inform such ground lessor that any notices of default under the
related Ground Lease should thereafter be forwarded to the Master Servicer.
(c) The Special Servicer shall submit to Bank of America on a
monthly basis an Officer's Certificate identifying in detail those Servicing
Advances incurred by the Special Servicer in connection with the foreclosure
action (the "Foreclosure Action") concerning the Spa Business Center Loan until
such time as the Spa Business Center Loan becomes a Corrected Mortgage Loan.
Notwithstanding anything to the contrary herein, no Principal Recovery Fee shall
be due and payable to the Special Servicer after such Mortgage Loan becomes a
Corrected Mortgage Loan solely because of a resolution of the Foreclosure Action
in favor of the Bank of America.
SECTION 3.20. Modifications, Waivers, Amendments and Consents.
(a) Subject to Sections 3.20(b) through 3.20(g) below and further
subject to Section 6.11, the Special Servicer may, on behalf of the Trustee,
agree to any modification,
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waiver or amendment of any term of any Mortgage Loan (including, subject to
Section 3.20(i), the lease reviews and lease consents related thereto) without
the consent of the Trustee or any Certificateholder.
(b) All modifications, waivers or amendments of any Mortgage Loan
(including, subject to Section 3.20(i), the lease reviews and lease consents
related thereto) shall be in writing and shall be considered and effected in
accordance with the Servicing Standard.
(c) Except as provided in 3.20(d) and the last sentence of Section
3.02(a), the Special Servicer, on behalf of the Trustee, shall not agree or
consent to any modification, waiver or amendment of any term of any Mortgage
Loan that would:
(i) affect the amount or timing of any related payment of
principal, interest or other amount (including Prepayment Premiums
or Yield Maintenance Charges, but excluding Penalty Interest and
amounts payable as additional servicing compensation) payable
thereunder;
(ii) affect the obligation of the related Mortgagor to pay a
Prepayment Premium or Yield Maintenance Charge or permit a Principal
Prepayment during any period in which the related Mortgage Note
prohibits Principal Prepayments;
(iii) except as expressly contemplated by the related Mortgage
or pursuant to Section 3.09(d), result in a release of the lien of
the Mortgage on any material portion of the related Mortgaged
Property without a corresponding Principal Prepayment in an amount
not less than the fair market value (as determined by an appraisal
by an Independent Appraiser delivered to the Special Servicer at the
expense of the related Mortgagor and upon which the Special Servicer
may conclusively rely) of the property to be released; or
(iv) in the reasonable, good faith judgment of the Special
Servicer, otherwise materially impair the security for such Mortgage
Loan or reduce the likelihood of timely payment of amounts due
thereon.
(d) Notwithstanding Section 3.20(c), but subject to the third
paragraph of this Section 3.20(d), the Special Servicer may (i) reduce the
amounts owing under any Specially Serviced Mortgage Loan by forgiving principal,
accrued interest or any Prepayment Premium or Yield Maintenance Charge, (ii)
reduce the amount of the monthly payment on any Specially Serviced Mortgage
Loan, including by way of a reduction in the related Mortgage Rate, (iii)
forbear in the enforcement of any right granted under any Mortgage Note or
Mortgage relating to a Specially Serviced Mortgage Loan or (iv) accept a
Principal Prepayment on any Specially Serviced Mortgage Loan during any Lockout
Period; provided that (A) the related Mortgagor is in default with respect to
the Specially Serviced Mortgage Loan or, in the reasonable, good faith judgment
of the Special Servicer, such default is
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reasonably foreseeable, (B) in the reasonable, good faith judgment of the
Special Servicer, such modification would increase the recovery on the Mortgage
Loan to Certificateholders on a net present value basis (the relevant
discounting of amounts that will be distributable to Certificateholders to be
performed at the related Net Mortgage Rate) and (C) such modification, waiver or
amendment would not both (1) effect an exchange or reissuance of the Mortgage
Loan under Section 1001 of the Code (and the Treasury regulations promulgated
thereunder) and (2) cause REMIC I, REMIC II or REMIC III to fail to qualify as a
REMIC under the Code or result in the imposition of any tax on "prohibited
transactions" or "contributions" after the Startup Day under the REMIC
Provisions.
In addition, notwithstanding Section 3.20(c), but subject to the
third paragraph of this Section 3.20(d), the Special Servicer may extend the
date on which any Balloon Payment is scheduled to be due in respect of a
Specially Serviced Mortgage Loan if the conditions set forth in the proviso to
the prior paragraph are satisfied and the Special Servicer has obtained an
appraisal in accordance with the standards of the Appraisal Institute of the
related Mortgaged Property, performed by an Independent Appraiser, in connection
with such extension, which appraisal supports the determination of the Special
Servicer contemplated by clause (B) of the proviso to the immediately preceding
paragraph.
In no event will the Special Servicer (i) extend the maturity date
of a Mortgage Loan beyond a date that is two years prior to the Rated Final
Distribution Date, (ii) extend the maturity date of any Mortgage Loan which has
a Mortgage Rate below the prevailing interest rate for comparable loans at the
time of such modification as determined by the Special Servicer, unless (A) such
Mortgage Loan is a Balloon Loan, (B) the related Mortgagor has failed to make
the Balloon Payment at its Stated Maturity Date and (C) such Balloon Loan is not
a Specially Serviced Mortgage Loan (other than by reason of the failure to make
its Balloon Payment) and has not been delinquent with respect to a Monthly
Payment (other than the Balloon Payment) in the preceding twelve months, in
which case the Special Servicer may permit up to three one-year extensions at
the existing Mortgage Rate for such Mortgage Loan (provided that such limitation
of extensions made at below market rate shall not limit the ability of the
Special Servicer to extend the maturity date of any Mortgage Loan at an interest
rate at or in excess to the prevailing rate for comparable loans at the time of
such modification), (iii) if the Mortgage Loan is secured by a Ground Lease (and
not by the corresponding fee simple interest), extend the maturity date of such
Mortgage Loan beyond a date which is less than 10 years prior to the expiration
of the term of such Ground Lease; (iv) reduce the Mortgage Rate to a rate below
the prevailing interest rate for comparable loans at the time of such
modification, as determined by the Special Servicer; or (v) defer interest due
on any Mortgage Loan in excess of 10% of the Stated Principal Balance of such
Mortgage Loan or defer the collection of interest on any Mortgage Loan without
accruing interest on such deferred interest at a rate at least equal to the
Mortgage Rate of such Mortgage Loan.
The determination of the Special Servicer contemplated by clause (B)
of the proviso to the first paragraph of this Section 3.20(d) shall be evidenced
by an Officer's Certificate to such effect delivered to the Trustee and the
Master Servicer and describing in
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reasonable detail the basis for the Special Servicer's determination. The
Special Servicer shall append to such Officer's Certificate any information
including but not limited to income and expense statements, rent rolls, property
inspection reports and appraisals that support such determination.
(e) Any payment of interest that is deferred pursuant to any
modification, waiver or amendment permitted hereunder, shall not, for purposes
hereof, including, without limitation, calculating monthly distributions to
Certificateholders, be added to the unpaid principal balance or Stated Principal
Balance of the related Mortgage Loan, notwithstanding that the terms of such
modification, waiver or amendment so permit. The foregoing shall in no way limit
the Special Servicer's ability to charge and collect from the Mortgagor costs
otherwise collectible under the terms of the related Mortgage Note and this
Agreement together with interest thereon.
(f) The Special Servicer may, as a condition to granting any request
by a Mortgagor for consent, modification, waiver or indulgence or any other
matter or thing, the granting of which is within its discretion pursuant to the
terms of the instruments evidencing or securing the related Mortgage Loan and is
permitted by the terms of this Agreement, require that such Mortgagor pay to it
(i) as additional servicing compensation, a reasonable or customary fee for the
additional services performed in connection with such request, and (ii) any
related costs and expenses incurred by it. In no event shall the Special
Servicer be entitled to payment for such fees or expenses unless such payment is
collected from the related Mortgagor.
(g) The Special Servicer shall notify the Master Servicer, any
related Sub-Servicers and the Trustee, in writing, of any modification, waiver
or amendment of any term of any Mortgage Loan (including fees charged the
Mortgagor) and the date thereof, and shall deliver to the Custodian for deposit
in the related Mortgage File, an original counterpart of the agreement relating
to such modification, waiver or amendment, promptly (and in any event within ten
Business Days) following the execution thereof. Copies of each agreement whereby
any such modification, waiver or amendment of any term of any Mortgage Loan is
effected shall be made available for review upon prior request during normal
business hours at the offices of the Special Servicer pursuant to Section
3.15(g) hereof.
(h) If, with respect to any Defeasance Loan, the Master Servicer
shall receive a notice from the related Mortgagor that it intends to prepay the
related Defeasance Loan in accordance with the terms thereof, except as set
forth below, the Master Servicer shall (a) promptly respond to such notice in a
manner which would require that the Mortgagor pledge Defeasance Collateral in
lieu of such prepayment pursuant to the terms of the related Mortgage Note, (b)
notify each Rating Agency, the Trustee and the Underwriters of the request to
defease a Mortgage Loan and (c) upon the written confirmation from each Rating
Agency described in the next paragraph, take such further action as provided in
such Mortgage Note to effectuate such defeasance, including the purchase and
perfection of the Defeasance Collateral in the name of the Trustee, as trustee
for the registered holders of First Union-
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Lehman Brothers-Bank of America Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2.
Notwithstanding the above, the Master Servicer shall not permit a
pledge of Defeasance Collateral in lieu of prepayment under a Defeasance Loan if
(i) such defeasance would occur within two years of the Startup Day, (ii) such
Defeasance Loan (or any applicable agreement executed in connection with the
related defeasance) provides that the Mortgagor will be liable for any
shortfalls from the Defeasance Collateral or otherwise become subjected to
recourse liability with respect to the Defeasance Loan, (iii) such defeasance
would result in a new Mortgagor on the Defeasance Loan (unless such new
Mortgagor is acquiring the Mortgaged Property that was the initial security for
the Defeasance Loan), or (iv) any Rating Agency does not confirm in writing to
the Master Servicer that the acceptance of a pledge of the Defeasance Collateral
in lieu of a full prepayment will not result in a downgrade, withdrawal or
qualification of the ratings then assigned by it to any Class of Certificates.
(i) For any Mortgage Loan other than a Specially Serviced Mortgage
Loan and subject to the rights of the Special Servicer set forth in this Section
3.20, the Master Servicer shall be responsible for any request by a Mortgagor
for the consent of the mortgagee for a modification, waiver or amendment of any
term with respect to:
(i) Approving routine leasing activity (including any
subordination, standstill and attornment agreements) with respect to
leases for less than the lesser of (a) 20,000 square feet and (b)
20% of the related Mortgaged Property; and
(ii) Approving a change of the property manager at the request
of the related Mortgagor provided that the successor property
manager is not affiliated with the Mortgagor and is a nationally or
regionally recognized manager of similar properties.
(j) The Special Servicer shall not consent to the modification,
waiver or amendment of a Lease Enhancement Policy without receiving prior
written confirmation from each Rating Agency that such modification, waiver or
amendment will not result in a qualification, downgrade or withdrawal of the
ratings on the Certificates or the prior written consent of each Rating Agency.
The Master Servicer shall not consent to any modification, waiver or amendment
of any Lease Enhancement Policy.
SECTION 3.21. Transfer of Servicing Between Master Servicer
and Special Servicer; Record Keeping.
(a) Upon determining that a Servicing Transfer Event has occurred
with respect to any Mortgage Loan and if the Master Servicer is not also the
Special Servicer, the Master Servicer shall immediately give notice thereof, and
shall deliver a copy of the related Servicing File, to the Special Servicer and
shall use reasonable efforts to provide the Special
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Servicer with all information, documents (or copies thereof) and records
(including records stored electronically on computer tapes, magnetic discs and
the like) relating to the Mortgage Loan either in the Master Servicer's or any
of its directors', officers', employees', affiliates' or agents' possession or
control or otherwise available to the Master Servicer without undue burden or
expense, and reasonably requested by the Special Servicer to enable it to assume
its functions hereunder with respect thereto without acting through a
Sub-Servicer. The Master Servicer shall use reasonable efforts to comply with
the preceding sentence within five Business Days of the occurrence of each
related Servicing Transfer Event; provided, however, if the information,
documents and records requested by the Special Servicer are not contained in the
Servicing File, the Master Servicer shall have such period of time as reasonably
necessary to make such delivery.
Upon determining that a Specially Serviced Mortgage Loan has become
a Corrected Mortgage Loan and if the Master Servicer is not also the Special
Servicer, the Special Servicer shall immediately give notice thereof, and shall
return the related Servicing File and all other information, documents and
records that were not part of the Servicing File when it was delivered to the
Special Servicer within five Business Days of the occurrence, to the Master
Servicer (or such other Person as may be directed by the Master Servicer) and
upon giving such notice, and returning such Servicing File, to the Master
Servicer (or such other Person as may be directed by the Master Servicer), the
Special Servicer's obligation to service such Mortgage Loan, and the Special
Servicer's right to receive the Special Servicing Fee with respect to such
Mortgage Loan, shall terminate, and the obligations of the Master Servicer to
service and administer such Mortgage Loan shall resume.
(b) In servicing any Specially Serviced Mortgage Loans, the Special
Servicer shall provide to the Custodian originals of documents included within
the definition of "Mortgage File" for inclusion in the related Mortgage File
(with a copy of each such original to the Master Servicer), and copies of any
additional related Mortgage Loan information, including correspondence with the
related Mortgagor.
(c) On or before each Determination Date, the Special Servicer shall
deliver to the Master Servicer and each Rating Agency (or such other Person as
may be directed by the Master Servicer) a statement in writing and in computer
readable format (the form of such statement to be agreed upon by the Master
Servicer) describing, on a loan-by-loan and property-by-property basis, (1)
insofar as it relates to Specially Serviced Mortgage Loans and REO Properties,
the information described in clauses (x) through (xiii) of Section 4.02(a) and,
insofar as it relates to the Special Servicer, the information described in
clauses (xxiii) and (xxiv) of Section 4.02(a), (2) the amount of all payments,
Insurance Proceeds and Liquidation Proceeds received, and the amount of any
Realized Loss incurred, with respect to each Specially Serviced Mortgage Loan
during the related Collection Period, and the amount of all REO Revenues,
Insurance Proceeds and Liquidation Proceeds received, and the amount of any
Realized Loss incurred, with respect to each REO Property during the related
Collection Period, (3) the amount, purpose and date of all Servicing Advances
made by the Special Servicer with respect to each Specially Serviced Mortgage
Loan and REO Property during the
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related Collection Period and (4) such additional information relating to the
Specially Serviced Mortgage Loans and REO Properties as the Master Servicer
reasonably requests to enable it to perform its responsibilities under this
Agreement. Notwithstanding the foregoing provisions of this subsection (c), the
Master Servicer shall maintain ongoing payment records with respect to each of
the Specially Serviced Mortgage Loans and REO Properties and shall provide the
Special Servicer with any information reasonably available to the Master
Servicer required by the Special Servicer to perform its duties under this
Agreement.
SECTION 3.22. Sub-Servicing Agreements.
(a) The Master Servicer and the Special Servicer may enter into
Sub-Servicing Agreements to provide for the performance by third parties of any
or all of their respective obligations hereunder, provided that, in each case,
the Sub-Servicing Agreement: (i) is consistent with this Agreement in all
material respects and requires the Sub-Servicer to comply with all of the
applicable conditions of this Agreement; (ii) provides that if the Master
Servicer or the Special Servicer, as the case may be, shall for any reason no
longer act in such capacity hereunder (including, without limitation, by reason
of an Event of Default), the Trustee or its designee may thereupon assume all of
the rights and, except to the extent they arose prior to the date of assumption,
obligations of the Master Servicer or the Special Servicer, as the case may be,
under such agreement or (except with respect only to those Sub-Servicing
Agreements in effect as of the date of this Agreement) may terminate such
subservicing agreement without cause and without payment of any penalty or
termination fee; (iii) provides that the Trustee, for the benefit of the
Certificateholders, shall be a third party beneficiary under such agreement, but
that (except to the extent the Trustee or its designee assumes the obligations
of the Master Servicer or the Special Servicer, as the case may be, thereunder
as contemplated by the immediately preceding clause (ii)) none of the Trustee,
the Trust Fund, any successor Master Servicer or Special Servicer, as the case
may be, or any Certificateholder shall have any duties under such agreement or
any liabilities arising therefrom; (iv) permits any purchaser of a Mortgage Loan
pursuant to this Agreement to terminate such agreement with respect to such
purchased Mortgage Loan at its option and without penalty, (v) does not permit
the Sub-Servicer to enter into or consent to any modification, waiver or
amendment or otherwise take any action on behalf of the Special Servicer
contemplated by Section 3.20 hereof without the consent of such Special
Servicer, and (vi) does not permit the Sub-Servicer any rights of
indemnification that may be satisfied out of assets of the Trust Fund. In
addition, each Sub-Servicing Agreement entered into by the Master Servicer shall
provide that such agreement shall be subject to Section 3.21 hereof with respect
to any Mortgage Loan that becomes a Specially Serviced Mortgage Loan. The Master
Servicer and the Special Servicer each shall deliver to the Trustee and to each
other copies of all Sub-Servicing Agreements, and any amendments thereto and
modifications thereof, entered into by it promptly upon its execution and
delivery of such documents. References in this Agreement to actions taken or to
be taken by the Master Servicer or the Special Servicer include actions taken or
to be taken by a Sub-Servicer on behalf of the Master Servicer or the Special
Servicer, as the case may be; and, in connection therewith, all amounts advanced
by any Sub-Servicer to satisfy the obligations of the Master Servicer or the
Special
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Servicer hereunder to make P&I Advances or Servicing Advances shall be deemed to
have been advanced by the Master Servicer or the Special Servicer, as the case
may be, out of its own funds and, accordingly, such P&I Advances or Servicing
Advances shall be recoverable by such Sub-Servicer in the same manner and out of
the same funds as if such Sub-Servicer were the Master Servicer or the Special
Servicer, as the case may be. For so long as they are outstanding, Advances
shall accrue interest in accordance with Sections 3.03(d) and 4.03(d), such
interest to be allocable between the Master Servicer or the Special Servicer, as
the case may be, and such Sub-Servicer as they may agree. For purposes of this
Agreement, the Master Servicer and the Special Servicer each shall be deemed to
have received any payment when a Sub-Servicer retained by it receives such
payment. The Master Servicer and the Special Servicer each shall notify the
other, the Trustee and the Depositor in writing promptly of the appointment by
it of any Sub-Servicer.
(b) Each Sub-Servicer (i) shall be authorized to transact business
in the state or states in which the related Mortgaged Properties it is to
service are situated, if and to the extent required by applicable law, and (ii)
except with respect to Cohen Financial Corporation as Subservicer, shall be an
approved conventional seller/servicer of mortgage loans for FHLMC or FNMA or a
HUD-Approved Servicer.
(c) The Master Servicer and the Special Servicer, for the benefit of
the Trustee and the Certificateholders, shall (at no expense to the Trustee, the
Certificateholders or the Trust Fund) monitor the performance and enforce the
obligations of their respective Sub-Servicers under the related Sub-Servicing
Agreements. Such enforcement, including, without limitation, the legal
prosecution of claims, termination of Sub-Servicing Agreements in accordance
with their respective terms and the pursuit of other appropriate remedies, shall
be in such form and carried out to such an extent and at such time as the Master
Servicer or the Special Servicer, as applicable, in its good faith business
judgment, would require were it the owner of the Mortgage Loans. Subject to the
terms of the related Sub-Servicing Agreement, the Master Servicer and the
Special Servicer may each have the right to remove a Sub-Servicer at any time it
considers such removal to be in the best interests of Certificateholders.
(d) In the event of the resignation, removal or other termination of
First Union National Bank or any successor Master Servicer hereunder for any
reason, the Trustee or other Person succeeding such resigning, removed or
terminated party as Master Servicer, shall elect, with respect to any
Sub-Servicing Agreement existing at the time of such termination: (i) to assume
the rights and obligations of the Master Servicer under such Sub-Servicing
Agreement and continue the sub-servicing arrangements thereunder on the same
terms (including without limitation the obligation to pay the same sub-servicing
fee); (ii) to enter into a new Sub-Servicing Agreement with such Sub-Servicer on
such terms as the Trustee or other successor Master Servicer and such
Sub-Servicer shall mutually agree (it being understood that such Sub-Servicer is
under no obligation to accept any such new Sub-Servicing Agreement or to enter
into or continue negotiations with the Trustee or other successor Master
Servicer in which case the existing Sub-Servicing Agreement shall remain in
effect), provided that neither the Trustee nor any successor Master Servicer
shall enter into a new Sub-Servicing Agreement with a Sub-Servicer that was a
party
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to a Sub-Servicing Agreement as of the date of this Agreement, if such new
Sub-Servicing Agreement amends, alters or fails to restate the rights of Lehman
Brothers Inc., if any, under the existing Sub-Servicing Agreement with respect
to the termination of the Sub-Servicer and the appointment of a successor
thereto or the rights of Lehman Brothers Inc., if any, as a third party
beneficiary under such Sub-Servicing Agreement, unless the successor Master
Servicer has obtained the prior written consent to the terms of such new
Sub-Servicing Agreement from Lehman Brothers Inc.; or (iii) to terminate the
Sub-Servicing Agreement if (but only if) an Event of Default (as defined in such
Sub-Servicing Agreement) has occurred and is continuing or either of the events
set forth in clauses (i) or (ii) of the following paragraph has occurred and is
continuing, in each case without paying any sub-servicer termination fee.
Each Sub-Servicing Agreement will provide, among other things, that
the Master Servicer may at its sole option, terminate any rights the
Sub-Servicer may have thereunder with respect to any or all Mortgage Loans if
any of the Rating Agencies (i) reduces the rating assigned to one or more
Classes of the respective Certificates as a result of the sub-servicing of the
Mortgage Loans by the Sub-Servicer, or (ii) advise the Master Servicer or the
Trustee that it will cause a qualification, downgrade or withdrawal of such
rating due to the continued servicing by the Sub-Servicer.
(e) Notwithstanding any Sub-Servicing Agreement, the Master Servicer
and the Special Servicer shall remain obligated and liable to the Trustee and
the Certificateholders for the performance of their respective obligations and
duties under this Agreement in accordance with the provisions hereof to the same
extent and under the same terms and conditions as if each alone were servicing
and administering the Mortgage Loans or REO Properties for which it is
responsible.
SECTION 3.23. Representations and Warranties of Master
Servicer and Special Servicer.
(a) The Master Servicer, in such capacity, hereby represents and
warrants to the Trustee, for its own benefit and the benefit of the
Certificateholders, and to the Depositor and the Special Servicer, as of the
Closing Date, that:
(i) The Master Servicer is a national banking association,
duly organized and in good standing under the laws of the United
States of America, and the Master Servicer is in compliance with the
laws of each State in which any Mortgaged Property is located to the
extent necessary to perform its obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the
Master Servicer, and the performance and compliance with the terms
of this Agreement by the Master Servicer, will not violate the
Master Servicer's articles of association or by-laws or constitute a
default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach
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of, any material agreement or other material instrument to which it
is a party or by which it is bound.
(iii) The Master Servicer has the full power and authority to
enter into and consummate all transactions contemplated by this
Agreement, has duly authorized the execution, delivery and
performance of this Agreement, and has duly executed and delivered
this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid,
legal and binding obligation of the Master Servicer, enforceable
against the Master Servicer in accordance with the terms hereof,
subject to (A) applicable receivership, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors'
rights generally and the rights of creditors of banks, and (B)
general principles of equity, regardless of whether such enforcement
is considered in a proceeding in equity or at law.
(v) The Master Servicer is not in violation of, and its
execution and delivery of this Agreement and its performance and
compliance with the terms of this Agreement will not constitute a
violation of, any law, any order or decree of any court or arbiter,
or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the Master
Servicer's good faith and reasonable judgment, is likely to affect
materially and adversely either the ability of the Master Servicer
to perform its obligations under this Agreement or the financial
condition of the Master Servicer.
(vi) No litigation is pending or, to the best of the Master
Servicer's knowledge, threatened, against the Master Servicer that
would prohibit the Master Servicer from entering into this Agreement
or, in the Master Servicer's good faith and reasonable judgment, is
likely to materially and adversely affect either the ability of the
Master Servicer to perform its obligations under this Agreement or
the financial condition of the Master Servicer, calculated on a
consolidated basis.
(vii) Each officer, director, employee, consultant or advisor
of the Master Servicer with responsibilities concerning the
servicing and administration of Mortgage Loans is covered by errors
and omissions insurance in the amounts and with the coverage as, and
to the extent, required by Section 3.07(c).
(viii) The net worth of the Master Servicer (or, in the case
of the initial Master Servicer, the consolidated net worth thereof
and of its direct or indirect parent), determined in accordance with
generally accepted accounting principles, is not less than
$15,000,000.
(ix) Any consent, approval, authorization or order of any
court or governmental agency or body required for the execution,
delivery and performance
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by the Master Servicer of or compliance by the Master Servicer with
this Agreement or the consummation of the transactions contemplated
by this Agreement has been obtained and is effective.
(x) The Master Servicer possesses all insurance required
pursuant to Section 3.07(c) of this Agreement.
(b) The Special Servicer, in such capacity, hereby represents and
warrants to the Trustee, for its own benefit and the benefit of the
Certificateholders, and to the Depositor and the Master Servicer, as of the
Closing Date, that:
(i) The Special Servicer is a Maryland limited partnership,
validly existing and in good standing under the laws of the State of
Maryland, and the Special Servicer is in compliance with the laws of
each State in which any Mortgaged Property is located to the extent
necessary to perform its obligations under this Agreement.
(ii) The execution and delivery of this Agreement by the
Special Servicer, and the performance and compliance with the terms
of this Agreement by the Special Servicer, will not violate the
Special Servicer's certificate of incorporation or constitute a
default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach of, any
material agreement or other material instrument by which it is
bound.
(iii) The Special Servicer has the full power and authority to
enter into and consummate all transactions contemplated by this
Agreement, has duly authorized the execution, delivery and
performance of this Agreement, and has duly executed and delivered
this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by each of the other parties hereto, constitutes a valid,
legal and binding obligation of the Special Servicer, enforceable
against the Special Servicer in accordance with the terms hereof,
subject to (A) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors'
rights generally, and (B) general principles of equity, regardless
of whether such enforcement is considered in a proceeding in equity
or at law.
(v) The Special Servicer is not in violation of, and its
execution and delivery of this Agreement and its performance and
compliance with the terms of this Agreement will not constitute a
violation of, any law, any order or decree of any court or arbiter,
or any order, regulation or demand of any federal, state or local
governmental or regulatory authority, which violation, in the
Special Servicer's good faith and reasonable judgment, is likely to
affect materially and
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adversely either the ability of the Special Servicer to perform its
obligations under this Agreement or the financial condition of the
Special Servicer.
(vi) No litigation is pending or, to the best of the Special
Servicer's knowledge, threatened, against the Special Servicer that
would prohibit the Special Servicer from entering into this
Agreement or, in the Special Servicer's good faith and reasonable
judgment, is likely to materially and adversely affect either the
ability of the Special Servicer to perform its obligations under
this Agreement or the financial condition of the Special Servicer.
(vii) Each officer, director and employee of the Special
Servicer and each consultant or advisor of the Special Servicer with
responsibilities concerning the servicing and administration of
Mortgage Loans is covered by errors and omissions insurance in the
amounts and with the coverage required by Section 3.07(c).
(viii) Any consent, approval, authorization or order of any
court or governmental agency or body required for the execution,
delivery and performance by the Special Servicer of or compliance by
the Special Servicer with this Agreement or the consummation of the
transactions contemplated by this Agreement has been obtained and is
effective.
(ix) The Special Servicer possesses all insurance required
pursuant to Section 3.07(c) of this Agreement.
(c) The representations and warranties of the Master Servicer and
the Special Servicer, set forth in Sections 3.23(a) and (b), respectively, shall
survive the execution and delivery of this Agreement and shall inure to the
benefit of the Persons for whose benefit they were made for so long as the Trust
Fund remains in existence. Upon discovery by any party hereto of any breach of
any of the foregoing representations and warranties, the party discovering such
breach shall give prompt written notice to the other parties.
(d) The Master Servicer covenants that by August 31, 1999, any
custom-made software or hardware designed or purchased or licensed by the Master
Servicer and used by the Master Servicer in the course of the operation or
management of, or the compiling, reporting or generation of data required by
this Agreement will not contain any material deficiency (x) in the ability of
such software or hardware to identify correctly or perform calculations or other
processing with respect to dates after August 31, 1999 or (y) that would cause
such software or hardware to be fit no longer for the purpose for which it was
intended by reason of the changing of the date from 1999 to 2000. A breach of
the covenant set forth in this Section 3.23(d) shall constitute an Event of
Default and termination shall be the sole remedy against the Master Servicer for
the breach of this covenant.
(e) The Special Servicer covenants that by August 31, 1999, any
custom-made software or hardware designed or purchased or licensed by the
Special Servicer and used
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by the Special Servicer in the course of the operation or management of, or the
compiling, reporting or generation of data required by this Agreement will not
contain any material deficiency (x) in the ability of such software or hardware
to identify correctly or perform calculations or other processing with respect
to dates after August 31, 1999 or (y) that would cause such software or hardware
to be fit no longer for the purpose for which it was intended by reason of the
changing of the date from 1999 to 2000. A breach of the covenant set forth in
this Section 3.23(e) shall constitute an Event of Default and termination shall
be the sole remedy against the Special Servicer for the breach of this covenant.
SECTION 3.24. Sub-Servicing Agreement Representation and
Warranty
(a) The Master Servicer, in such capacity, hereby represents and
warrants to the Trustee, for its own benefit and the benefit of the
Certificateholders, and to the Depositor and the Special Servicer, as of the
Closing Date, that each Sub-Servicing Agreement satisfies the requirements for
such Sub-Servicing Agreements set forth in Sections 3.22(a) and the second
paragraph of 3.22(d) in all material respects.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.
(a) On each Distribution Date, the Paying Agent shall (except as
otherwise provided in Section 9.01), based on information provided by the Master
Servicer and the Special Servicer, apply amounts on deposit in the Distribution
Account, after payment of amounts payable from the Distribution Account in
accordance with Section 3.05(b)(ii) through (vii), for the following purposes
and in the following order of priority, in each case to the extent of the
remaining portion of the Available Distribution Amount:
(i) to distributions of interest to the Holders of the Senior
Certificates in an amount equal to, and pro rata in accordance with,
all Distributable Certificate Interest in respect of each Class of
Senior Certificates for such Distribution Date and, to the extent
not previously paid, for all prior Distribution Dates;
(ii) to distributions of principal to the Holders of the Class
A-1 Certificates, in an amount (not to exceed the Class Principal
Balance of the Class A-1 Certificates outstanding immediately prior
to such Distribution Date) equal to the entire Principal
Distribution Amount for such Distribution Date;
(iii) after the Class Principal Balance of the Class A-1
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class A-2 Certificates, in an amount (not to
exceed the Class Principal Balance of the Class A-2 Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of the Class A-1 Certificates pursuant to clause (ii)
above);
(iv) to distributions to the Holders of the Class A-1
Certificates and the Holders of the Class A-2 Certificates, pro rata
in accordance with, in an amount equal to, and in reimbursement of,
all Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to each such Class of Certificates and not
previously reimbursed;
(v) to distributions of interest to the Holders of the Class B
Certificates in an amount equal to all Distributable Certificate
Interest in respect of such Class of Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
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(vi) after the Class Principal Balances of the Class A-1
Certificates and the Class A-2 Certificates have been reduced to
zero, to distributions of principal to the Holders of the Class B
Certificates, in an amount (not to exceed the Class Principal
Balance of the Class B Certificates outstanding immediately prior to
such Distribution Date) equal to the entire Principal Distribution
Amount for such Distribution Date (net of any portion thereof
distributed on such Distribution Date to the Holders of any other
Class of Certificates pursuant to any prior clause of this Section
4.01(a)).
(vii) to distributions to the Holders of the Class B
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class B Certificates and not previously
reimbursed;
(viii) to distributions of interest to the Holders of the
Class C Certificates in an amount equal to all Distributable
Certificate Interest in respect of such Class of Certificates for
such Distribution Date and, to the extent not previously paid, for
all prior Distribution Dates;
(ix) after the Class Principal Balance of the Class B
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class C Certificates, in an amount (not to
exceed the Class Principal Balance of the Class C Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(x) to distributions to the Holders of the Class C
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class C Certificates and not previously
reimbursed;
(xi) to distributions of interest to the Holders of the Class
D Certificates, in an amount equal to all Distributable Certificate
Interest in respect of the Class D Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xii) after the Class Principal Balance of the Class C
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class D Certificates, in an amount (not to
exceed the Class Principal Balance of the Class D Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of
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any other Class of Certificates pursuant to any prior clause of this
Section 4.01(a));
(xiii) to distributions to the Holders of the Class D
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class D Certificates and not previously
reimbursed;
(xiv) to distributions of interest to the Holders of the Class
E Certificates, in an amount equal to all Distributable Certificate
Interest in respect of the Class E Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xv) after the Class Principal Balance of the Class D
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class E Certificates, in an amount (not to
exceed the Class Principal Balance of the Class E Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(xvi) to distributions to the Holders of the Class E
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class E Certificates and not previously
reimbursed;
(xvii) to distributions of interest to the Holders of the
Class F Certificates, in an amount equal to all Distributable
Certificate Interest in respect of the Class F Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xviii) after the Class Principal Balance of the Class E
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class F Certificates, in an amount (not to
exceed the Class Principal Balance of the Class F Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(xix) to distributions to the Holders of the Class F
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional
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Trust Fund Expenses, if any, previously allocated to the Class F
Certificates and not previously reimbursed;
(xx) to distributions of interest to the Holders of the Class
G Certificates, in an amount equal to all Distributable Certificate
Interest in respect of the Class G Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxi) after the Class Principal Balance of the Class F
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class G Certificates, in an amount (not to
exceed the Class Principal Balance of the Class G Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(xxii) to distributions to the Holders of the Class G
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class G Certificates and not previously
reimbursed;
(xxiii) to distributions of interest to the Holders of Class H
Certificates, in an amount equal to all Distributable Certificate
Interest in respect of the Class H Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxiv) after the Class Principal Balance of the Class G
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class H Certificates, in an amount (not to
exceed the Class Principal Balance of the Class H Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(xxv) to distributions to the Holders of the Class H
Certificates in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to such Class of Certificates and not
previously reimbursed;
(xxvi) to distributions of interest to the Holders of the
Class J Certificates, in an amount equal to all Distributable
Certificate Interest in
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respect of the Class J Certificates for such Distribution Date and,
to the extent not previously paid, for all prior Distribution Dates;
(xxvii) after the Class Principal Balance of the Class H
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class J Certificates, in an amount (not to
exceed the Class Principal Balance of the Class J Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(xxviii) to distributions to the Holders of the Class J
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class J Certificates and not previously
reimbursed;
(xxix) to distributions of interest to the Holders of the
Class K Certificates, in an amount equal to all Distributable
Certificate Interest in respect of the Class K Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxx) after the Class Principal Balance of the Class J
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class K Certificates, in an amount (not to
exceed the Class Principal Balance of the Class K Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(xxxi) to distributions to the Holders of the Class K
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class K Certificates and not previously
reimbursed;
(xxxii) to distributions of interest to the Holders of the
Class L Certificates, in an amount equal to all Distributable
Certificate Interest in respect of the Class L Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxxiii) after the Class Principal Balance of the Class K
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class L Certificates, in an amount (not to
exceed the Class Principal Balance of the
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Class L Certificates outstanding immediately prior to such
Distribution Date) equal to the entire Principal Distribution Amount
for such Distribution Date (net of any portion thereof distributed
on such Distribution Date to the Holders of any other Class of
Certificates pursuant to any prior clause of this Section 4.01(a));
(xxxiv) to distributions to the Holders of the Class L
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class L Certificates and not previously
reimbursed; and
(xxxv) to distributions of interest to the Holders of the
Class M Certificates, in an amount equal to all Distributable
Certificate Interest in respect of the Class M Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxxvi) after the Class Principal Balance of the Class L
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class M Certificates, in an amount (not to
exceed the Class Principal Balance of the Class M Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
(xxxvii) to distributions to the Holders of the Class M
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class M Certificates and not previously
reimbursed;
(xxxviii) to distributions of interest to the Holders of the
Class N Certificates, in an amount equal to all Distributable
Certificate Interest in respect of the Class N Certificates for such
Distribution Date and, to the extent not previously paid, for all
prior Distribution Dates;
(xxxix) after the Class Principal Balance of the Class M
Certificates has been reduced to zero, to distributions of principal
to the Holders of the Class N Certificates, in an amount (not to
exceed the Class Principal Balance of the Class N Certificates
outstanding immediately prior to such Distribution Date) equal to
the entire Principal Distribution Amount for such Distribution Date
(net of any portion thereof distributed on such Distribution Date to
the Holders of any other Class of Certificates pursuant to any prior
clause of this Section 4.01(a));
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(xl) to distributions to the Holders of the Class N
Certificates, in an amount equal to, and in reimbursement of, all
Realized Losses and Additional Trust Fund Expenses, if any,
previously allocated to the Class N Certificates and not previously
reimbursed; and
(xli) to make distributions to the Holders of the Class R-III
Certificates, in an amount equal to the excess, if any, of (A) the
aggregate distributions deemed made in respect of the REMIC II
Regular Interests on such Distribution Date pursuant to Section
4.01(h), over (B) the aggregate distributions deemed made in respect
of the Regular Certificates on such Distribution Date pursuant to
clauses (i) through (xl) above;
(xlii) to make distributions to the Holders of the Class R-II
Certificates, up to an amount equal to the excess, if any, of (A)
the aggregate distributions deemed made in respect of the REMIC I
Regular Interests on such Distribution Date pursuant to Section
4.01(i), over (B) the aggregate distributions deemed made in respect
of the REMIC II Regular Interests on such Distribution Date pursuant
to Section 4.01(h);
(xliii) to distributions to the Holders of the Class R-I
Certificates, in an amount equal to the balance, if any, of the
Available Distribution Amount for such Distribution Date remaining
after the distributions to be made on such Distribution Date
pursuant to clauses (i) through (xlii) above;
provided that on each Distribution Date after the aggregate of Class Principal
Balances of each Class of Subordinated Certificates has been reduced to zero,
the payments of principal to be made as contemplated by clauses (ii) and (iii)
above with respect to the Class A Certificates will be made to the Holders of
the respective Classes of such Class A Certificates up to an amount equal to,
and pro rata as among such Classes in accordance with, the respective then
outstanding Class Principal Balances of such Classes of Certificates and without
regard to the Principal Distribution Amount for such Distribution Date.
Distributions in reimbursement of Realized Losses and Additional Trust Fund
Expenses previously allocated to a Class of Certificates shall not constitute
distributions of principal and shall not result in reduction of the related
Class Principal Balance.
All distributions of interest made in respect of the Class IO
Certificates on any Distribution Date pursuant to clause (i) above, shall be
deemed to have been made in respect of all the Components of such Class, pro
rata in accordance with the respective amounts of Distributable Certificate
Interest that would be payable on such Components on such Distribution Date if
each such Component were treated as a separate Class of Regular Certificates.
(b) On each Distribution Date, the Paying Agent shall withdraw from
the Distribution Account any amounts that represent Prepayment Premiums and/or
Yield
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Maintenance Charges actually collected on the Mortgage Loans and any REO Loans
during the related Collection Period and shall distribute each such Prepayment
Premium and/or Yield Maintenance Premium, as additional interest, as follows:
(i) first, to the Holders of the respective Classes of
Sequential Pay Certificates (other than any Excluded Class thereof)
entitled to distributions of principal pursuant to Section 4.01(a)
on such Distribution Date, up to an amount equal to, and pro rata
based on, the Additional Yield Amounts for each such Class of
Certificates for such Distribution Date; and
(ii) second, to the Holders of the Class IO Certificates, to
the extent of any remaining portion of such Prepayment Premium
and/or Yield Maintenance Charge (distributions pursuant to this
clause (ii) to be deemed allocable among the respective Components
of the Class IO Certificates on a pro rata basis in accordance with
the respective amounts of Accrued Component Interest in respect of
such Components for the subject Distribution Date).
On each Distribution Date, the Trustee shall withdraw from the
Distribution Account any amounts that represent Additional Interest actually
collected on the ARD Loans and any related REO Loans during the related
Collection Period and shall distribute: (i) 5% of such amounts to the Holders of
the Class IO Certificates; and (ii) 95% of such amounts among the Holders of the
Class A-1 Certificates, the Class A-2 Certificates, the Class B Certificates,
the Class C Certificates, the Class D Certificates, the Class E Certificates and
the Class F Certificates on a pro rata basis in accordance with the respective
initial Class Principal Balances of such Classes of Certificates, without regard
to whether any such Class is entitled to distributions of principal on such
Distribution Date (whether by reason of its Class Principal Balance having been
reduced to zero or by reason of it not yet being entitled to distributions of
principal). Notwithstanding that the principal balance or notional amount, as
the case may be, of a REMIC Regular Interest has been reduced to zero, the
Trustee's obligation is limited to distributions to the last Certificateholder
of record.
(c) All distributions made with respect to each Class on each
Distribution Date shall be allocated pro rata among the outstanding Certificates
in such Class based on their respective Percentage Interests. Except as
otherwise provided below, all such distributions with respect to each Class on
each Distribution Date shall be made to the Certificateholders of the respective
Class of record at the close of business on the related Record Date and shall be
made by wire transfer of immediately available funds to the account of any such
Certificateholder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided the Paying Agent with
wiring instructions no less than five Business Days prior to the related Record
Date (which wiring instructions may be in the form of a standing order
applicable to all subsequent Distribution Dates), or otherwise by check mailed
to the address of such Certificateholder as it appears in the Certificate
Register. The final distribution on each Certificate (determined, in the case of
a Sequential Pay Certificate, without regard to any possible future
reimbursement of any Realized Loss or
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Additional Trust Fund Expense previously allocated to such Certificate, but
taking into account possible future distributions of Additional Interest) will
be made in a like manner, but only upon presentation and surrender of such
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution. Prior
to any termination of the Trust Fund pursuant to Section 9.01, any distribution
that is to be made with respect to a Certificate in reimbursement of a Realized
Loss or Additional Trust Fund Expense previously allocated thereto, which
reimbursement is to occur after the date on which such Certificate is
surrendered as contemplated by the preceding sentence, will be made by check
mailed to the address of the Certificateholder that surrendered such Certificate
as such address last appeared in the Certificate Register or to any other
address of which the Paying Agent was subsequently notified in writing. If such
check is returned to the Paying Agent, the Paying Agent, directly or through an
agent, shall take such reasonable steps to contact the related Holder and
deliver such check as it shall deem appropriate. Any funds in respect of a check
returned to the Paying Agent shall be set aside by the Paying Agent and held
uninvested in trust and credited to the account of the appropriate Holder. The
costs and expenses of locating the appropriate Holder and holding such funds
shall be paid out of such funds. No interest shall accrue or be payable to any
former Holder on any amount held in trust hereunder. If the Paying Agent has
not, after having taken such reasonable steps, located the related Holder by the
second anniversary of the initial sending of a check, the Paying Agent shall,
subject to applicable law, distribute the unclaimed funds to the Holders of the
Class R-III Certificates.
(d) Each distribution with respect to a Book-Entry Certificate shall
be paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the related Certificate Owners that it represents and to each indirect
participating brokerage firm (a "brokerage firm" or "indirect participating
firm") for which it acts as agent. Each brokerage firm shall be responsible for
disbursing funds to the related Certificate Owners that it represents. None of
the Trustee, the Paying Agent, the Certificate Registrar, the Depositor or the
Master Servicer shall have any responsibility therefor except as otherwise
provided by this Agreement or applicable law. The Trustee and the Depositor
shall perform their respective obligations under a Letter of Representations
among the Depositor, the Trustee and the initial Depository dated as of the
Closing Date.
(e) The rights of the Certificateholders to receive distributions
from the proceeds of the Trust Fund in respect of the Certificates, and all
rights and interests of the Certificateholders in and to such distributions,
shall be as set forth in this Agreement. Neither the Holders of any Class of
Certificates nor any party hereto shall in any way be responsible or liable to
the Holders of any other Class of Certificates in respect of amounts properly
previously distributed on the Certificates.
(f) Except as otherwise provided in Section 9.01, whenever the
Paying Agent receives written notification of or expects that the final
distribution with respect to any
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Class of Certificates (determined without regard to any possible future
reimbursement of any Realized Loss or Additional Trust Fund Expense previously
allocated to such Class of Certificates) will be made on the next Distribution
Date, the Paying Agent shall, no later than five days after the related
Determination Date, mail to each Holder of record on such date of such Class of
Certificates a notice to the effect that:
(i) the Paying Agent expects that the final distribution with
respect to such Class of Certificates will be made on such
Distribution Date but only upon presentation and surrender of such
Certificates at the office of the Certificate Registrar or at such
other location therein specified, and
(ii) no interest shall accrue on such Certificates from and
after such Distribution Date.
Any funds not distributed to any Holder or Holders of Certificates of such Class
on such Distribution Date because of the failure of such Holder or Holders to
tender their Certificates shall, on such date, be set aside and held uninvested
in trust and credited to the account or accounts of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.01(f) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Paying Agent shall mail a second notice to the remaining non-tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within one year after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Paying Agent, directly or through an agent, shall take such
steps to contact the remaining non-tendering Certificateholders concerning the
surrender of their Certificates as it shall deem appropriate. The costs and
expenses of holding such funds in trust and of contacting such
Certificateholders following the first anniversary of the delivery of such
second notice to the non-tendering Certificateholders shall be paid out of such
funds. No interest shall accrue or be payable to any former Holder on any amount
held in trust pursuant to this paragraph. If all of the Certificates shall not
have been surrendered for cancellation by the second anniversary of the delivery
of the second notice, the Paying Agent shall, subject to applicable law,
distribute to the Holders of the Class R-III Certificates all unclaimed funds
and other assets which remain subject thereto.
(g) Notwithstanding any other provision of this Agreement, the
Paying Agent shall comply with all federal withholding requirements respecting
payments to Certificateholders of interest or original issue discount that the
Paying Agent reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. If the Paying
Agent does withhold any amount from interest or original issue discount payments
or advances thereof to any Certificateholder pursuant to federal withholding
requirements, the Paying Agent shall indicate the amount withheld to such
Certificateholders.
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(h) All distributions made in respect of any Class of Sequential Pay
Certificates on each Distribution Date pursuant to Section 4.01(a), the first
paragraph of Section 4.01(b) or Section 9.01 shall be deemed to have first been
distributed from REMIC II to REMIC III in respect of its Corresponding REMIC II
Regular Interest set forth in the Preliminary Statement hereto; and all
distributions made in respect of the Class IO Certificates on each Distribution
Date pursuant to Section 4.01(a), the first paragraph of Section 4.01(b) or
Section 9.01, and allocable to any particular Component of such Class of
Certificates, shall be deemed to have first been distributed from REMIC II to
REMIC III in respect of such Component's Corresponding REMIC II Regular
Interest. In each case, if such distribution on any such Class of Regular
Certificates was a distribution of interest, of principal, of Prepayment
Premiums or Yield Maintenance Charges or in reimbursement of previously
allocated Realized Losses and Additional Trust Fund Expenses in respect of such
Class of Regular Certificates, then the corresponding distribution deemed to be
made on a REMIC II Regular Interest pursuant to the preceding sentence shall be
deemed to also be a distribution of interest, of principal, of Prepayment
Premiums or Yield Maintenance Charges or in reimbursement of previously
allocated Realized Losses and Additional Trust Fund Expenses, as the case may
be, in respect of such REMIC II Regular Interest.
(i) On each Distribution Date, including, without limitation, the
final Distribution Date in connection with a termination of the Trust Fund, the
Available Distribution Amount for such date shall be deemed to have first been
distributed from REMIC I to REMIC II in respect of the REMIC I Regular
Interests, in each case to the extent of the remaining portions of such funds,
for the following purposes and in the following order of priority:
(i) as deemed distributions of interest in respect of the
REMIC I Regular Interests, in an amount equal to, and pro rata in
accordance with, all Uncertificated Distributable Interest in
respect of each such REMIC I Regular Interest for such Distribution
Date and, to the extent not previously deemed distributed, for all
prior Distribution Dates;
(ii) as deemed distributions of principal in respect of the
REMIC I Regular Interests, in an amount equal to, and pro rata in
accordance with, as to each such REMIC I Regular Interest, the
excess, if any, of the Uncertificated Principal Balance of such
REMIC I Regular Interest outstanding immediately prior to such
Distribution Date, over the Stated Principal Balance of the related
Mortgage Loan (or successor REO Loan) that will be outstanding
immediately following such Distribution Date; and
(iii) as deemed distributions in respect of the REMIC I
Regular Interests, in an amount equal to, pro rata in accordance
with, and in reimbursement of, any Realized Losses and Additional
Trust Fund Expenses (with compounded interest), previously allocated
to each such REMIC I Regular Interest.
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Any Prepayment Premiums or Yield Maintenance Charges distributed to any
Class of Regular Certificates on any Distribution Date shall, in each case, be
deemed to have been distributed from REMIC I to REMIC II in respect of the REMIC
I Regular Interest corresponding to the prepaid Mortgage Loan or REO Loan, as
the case may be, in respect of which such premium or charge was received.
SECTION 4.02. Statements to Certificateholders; CSSA Loan
File Report.
(a) On each Distribution Date, the Trustee shall forward by mail (or
by electronic transmission acceptable to the recipient) to each
Certificateholder, each initial Certificate Owner and (upon written request made
to the Trustee) each subsequent Certificate Owner (as identified to the
reasonable satisfaction of the Trustee), the Depositor, the Master Servicer, the
Special Servicer, the Underwriters and each Rating Agency, a statement (a
"Distribution Date Statement"), as to the distributions made on such
Distribution Date, based on information provided to it by the Master Servicer
and the Special Servicer, setting forth:
(i) the amount of the distribution on such Distribution Date
to the Holders of each Class of Regular Certificates in reduction of
the Class Principal Balance thereof;
(ii) the amount of the distribution on such Distribution Date
to the Holders of each Class of Regular Certificates allocable to
Distributable Certificate Interest;
(iii) the amount of the distribution on such Distribution Date
to the Holders of each Class of Regular Certificates allocable to
(A) Prepayment Premiums and/or Yield Maintenance Charges or (B)
Additional Interest;
(iv) the amount of the distribution on such Distribution Date
to the Holders of each Class of Regular Certificates in
reimbursement of previously allocated Realized Losses and Additional
Trust Fund Expenses;
(v) the Available Distribution Amount for such Distribution
Date;
(vi) (a) the aggregate amount of P&I Advances made in respect
of such Distribution Date pursuant to Section 4.03(a), including,
without limitation, any amounts applied pursuant to Section
4.03(a)(ii), and the aggregate amount of unreimbursed P&I Advances
that had been outstanding at the close of business on the related
Determination Date and the aggregate amount of interest accrued and
payable to the Master Servicer or the Trustee in respect of such
unreimbursed P&I Advances in accordance with Section 4.03(d) as of
the close of business on the related Determination Date, (b) the
aggregate amount of Servicing Advances as of the close of business
on the related Determination Date and (c) the aggregate amount of
all Nonrecoverable Advances as of the close of business on the
related Determination Date;
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(vii) the aggregate unpaid principal balance of the Mortgage
Pool outstanding as of the close of business on the related
Determination Date;
(viii) the aggregate Stated Principal Balance of the Mortgage
Pool outstanding immediately before and immediately after such
Distribution Date;
(ix) the number, aggregate principal balance, weighted average
remaining term to maturity and weighted average Mortgage Rate of the
Mortgage Loans as of the close of business on the related
Determination Date;
(x) the number, aggregate unpaid principal balance (as of the
close of business on the related Determination Date) and aggregate
Stated Principal Balance (immediately after such Distribution Date)
of Mortgage Loans (A) delinquent 30-59 days, (B) delinquent 60-89
days, (C) delinquent more than 89 days, and (D) as to which
foreclosure proceedings have been commenced;
(xi) as to each Mortgage Loan referred to in the preceding
clause (x) above, (A) the loan number thereof, (B) the Stated
Principal Balance thereof immediately following such Distribution
Date, and (C) a brief description of any executed loan modification;
(xii) with respect to any Mortgage Loan as to which a
Liquidation Event occurred during the related Collection Period
(other than a payment in full), (A) the loan number thereof, (B) the
aggregate of all Liquidation Proceeds and other amounts received in
connection with such Liquidation Event (separately identifying the
portion thereof allocable to distributions on the Certificates), and
(C) the amount of any Realized Loss in connection with such
Liquidation Event;
(xiii) with respect to any REO Property included in the Trust
Fund as to which a Final Recovery Determination was made during the
related Collection Period, (A) the loan number of the related
Mortgage Loan, (B) the aggregate of all Liquidation Proceeds and
other amounts received in connection with such Final Recovery
Determination (separately identifying the portion thereof allocable
to distributions on the Certificates), and (C) the amount of any
Realized Loss in respect of the related REO Loan in connection with
such Final Recovery Determination;
(xiv) the Accrued Certificate Interest and Distributable
Certificate Interest in respect of each Class of Regular
Certificates for such Distribution Date;
(xv) any unpaid Distributable Certificate Interest in respect
of each Class of Regular Certificates after giving effect to the
distributions made on such Distribution Date;
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(xvi) the Pass-Through Rate for each Class of Regular
Certificates for such Distribution Date;
(xvii) the Principal Distribution Amount for such Distribution
Date, separately identifying the respective components thereof (and,
in the case of any Principal Prepayment or other unscheduled
collection of principal received during the related Collection
Period, the loan number for the related Mortgage Loan and the amount
of such prepayment or other collection of principal);
(xviii) the aggregate of all Realized Losses incurred during
the related Collection Period and all Additional Trust Fund Expenses
incurred during the related Collection Period;
(xix) the aggregate of all Realized Losses and Additional
Trust Fund Expenses that were allocated on such Distribution Date;
(xx) the Class Principal Balance of each Class of Regular
Certificates (other than the Class IO Certificates) and the
Component Notional Amount of each Component outstanding immediately
before and immediately after such Distribution Date, separately
identifying any reduction therein due to the allocation of Realized
Losses and Additional Trust Fund Expenses on such Distribution Date;
(xxi) the Certificate Factor for each Class of Regular
Certificates immediately following such Distribution Date;
(xxii) the aggregate amount of interest on P&I Advances paid
to the Master Servicer and the Trustee during the related Collection
Period in accordance with Section 4.03(d);
(xxiii) the aggregate amount of interest on Servicing Advances
paid to the Master Servicer, the Trustee and the Special Servicer
during the related Collection Period in accordance with Section
3.03(d);
(xxiv) the aggregate amount of servicing fees paid to the
Master Servicer and the Special Servicer during the related
Collection Period; and
(xxv) the loan number for each Required Appraisal Loan and any
related Appraisal Reduction Amount as of the related Determination
Date;
(xxvi) the original and then current credit support levels for
each Class of Regular Certificates;
(xxvii) the original and then current ratings for each Class
of Regular Certificates;
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(xxviii) the aggregate amount of Prepayment Premiums and Yield
Maintenance Charges collected during the related Collection Period;
and
(xxix) the amounts, if any, actually distributed with respect
to the Class R-I Certificates, Class R-II Certificates and Class
R-III Certificates on such Distribution Date.
In the case of information to be furnished pursuant to clauses (i)
through (iv) above, the amounts shall be expressed as a dollar amount in the
aggregate for all Certificates of each applicable Class and per Single
Certificate. In the case of information provided to the Trustee as a basis for
information to be furnished pursuant to clauses (x) through (xiii), and (xxiv)
above, insofar as the underlying information is solely within the control of the
Special Servicer, the Trustee and the Master Servicer may, absent manifest
error, conclusively rely on the reports to be provided by the Special Servicer.
The Trustee may rely on and shall not be responsible absent manifest
error for the content or accuracy of any information provided by third parties
for purposes of preparing the Distribution Date Statement and may affix thereto
any disclaimer it deems appropriate in its reasonable discretion (without
suggesting liability on the part of any other party hereto).
The Trustee shall deliver or shall cause to be delivered on each
Distribution Date either electronically or by first class mail to each
Certificateholder, the Depositor, the Underwriters, each Rating Agency and any
other Person designated in writing by the Depositor (by hard copy, on diskette
or via such other electronic medium as is mutually acceptable to the Trustee and
the recipient) a copy of the following nine reports or in the case of reports to
Persons designated in writing by the Depositor, any of the following nine
reports delivered to it by the Master Servicer pursuant to Section 3.12(c): (i)
the Delinquent Loan Status Report, (ii) the Historical Loss Estimate Report,
(iii) the Historical Loan Modification Report, (iv) the REO Status Report, (v)
the Watch List, (vi) a Loan Payoff Notification Report, (vii) a Comparative
Financial Status Report, (viii) an Operating Statement Analysis and (ix) an NOI
Adjustment Worksheet. The Trustee shall deliver or shall cause to be delivered
on each Distribution Date by first class mail (or by electronic transmission
acceptable to the recipient) to each Certificateholder, each Certificate Owner,
the Underwriters, the Depositor, each Rating Agency and each other Person that
received a Distribution Date Statement on such Distribution Date a hard copy (or
a copy in an electronic medium acceptable to the recipient) of the CSSA Loan
File Report and the CSSA Property File Report containing information regarding
each Mortgaged Property most recently received from the Master Servicer. Absent
manifest error, none of the Master Servicer or the Special Servicer shall be
responsible for the accuracy or completeness of any information supplied to it
by a borrower or third party that is included in any reports, statements,
materials or information prepared or provided by the Master Servicer or the
Special Servicer, as applicable. The Trustee shall not be responsible absent
manifest error for the accuracy or completeness of any information supplied to
it for delivery pursuant to this Section. Neither the Trustee, the Master
Servicer
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nor the Special Servicer shall have any obligation to verify the accuracy or
completeness of any information provided by a Mortgagor or third party.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall send to each Person who at any time during the calendar
year was a Certificateholder of record, a report summarizing on an annual basis
(if appropriate) the items provided to Certificateholders pursuant to clauses
(i), (ii), (iii) and (iv) of the description of "Distribution Date Statement"
above and such other information as may be required to enable such
Certificateholders to prepare their federal income tax returns. Such information
shall include the amount of original issue discount accrued on each Class of
Certificates and information regarding the expenses of the Trust Fund. Such
requirement shall be deemed to be satisfied to the extent such information is
provided pursuant to applicable requirements of the Code from time to time in
force.
On each Distribution Date, the Trustee shall forward to The Trepp
Group (at 477 Madison Avenue, 18th Floor, New York, New York 10022, or such
other address as The Trepp Group may hereafter designate), a copy of the
Distribution Date Statement and Unrestricted Servicer Reports forwarded to the
Holders of the Regular Certificates on such Distribution Date and a statement
setting forth the amounts, if any, actually distributed with respect to the
Class R-I, Class R-II and Class R-III Certificates on such Distribution Date.
If any Certificate Owner does not receive through the Depository or
any of its Depository Participants any of the statements, reports and/or other
written information described above in this Section 4.02(a) that it would
otherwise be entitled to receive if it were the Holder of a Definitive
Certificate evidencing its ownership interest in the related Class of Book Entry
Certificates, then the Trustee shall mail or cause the mailing of such
statements, reports and/or other written information to such Certificate Owner
upon the request of such Certificate Owner made in writing to the Corporate
Trust Office (accompanied by current verification of such Certificate Owner's
ownership interest). Such portion of such information as may be agreed upon by
the Depositor and the Trustee shall be furnished to any such Person via
overnight courier delivery or telecopy from the Trustee; provided that the cost
of such overnight courier delivery or telecopy shall be an expense of the party
requesting such information.
The Trustee shall only be obligated to deliver the statements,
reports and information contemplated by this Section 4.02(a) to the extent it
receives the necessary underlying information from the Special Servicer or
Master Servicer, as applicable, and shall not be liable for any failure to
deliver any thereof on the prescribed due dates, to the extent caused by failure
to receive timely such underlying information. Nothing herein shall obligate the
Trustee or the Master Servicer to violate any applicable law prohibiting
disclosure of information with respect to any Mortgagor and the failure of the
Trustee, Master Servicer or the Special Servicer to disseminate information for
such reason shall not be a breach hereof.
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(b) Not later than 2:00 p.m. New York City time on the third
Business Day following each Determination Date or, if in any month the
Distribution Date is the fifth Business Day following the related Determination
Date, then not later than the second Business Day following such Determination
Date, the Master Servicer shall furnish to the Trustee, the Depositor and the
Underwriters, by electronic transmission (or in such other form to which the
Trustee or the Depositor, as the case may be, and the Master Servicer may
agree), with a hard copy of such transmitted information to follow promptly, an
accurate and complete CSSA Loan File Report providing the required information
for the Mortgage Loans as of such Determination Date. The Depositor shall
provide the information necessary for the CSSA set up file.
In the performance of its obligations set forth in Section 4.05 and
its other duties hereunder, the Trustee may conclusively rely on the CSSA Loan
File Report provided to it by the Master Servicer, and the Trustee shall not be
responsible to recompute, recalculate or verify the information provided to it
by the Master Servicer. In the case of information to be furnished by the Master
Servicer to the Trustee pursuant to this Section 4.02(b), insofar as such
information is solely within the control of the Special Servicer, the Master
Servicer shall have no obligation to provide such information until it has
received such information from the Special Servicer, shall not be in default
hereunder due to a delay in providing the CSSA Loan File Report caused by the
Special Servicer's failure to timely provide any report required under this
Agreement and may, absent manifest error, conclusively rely on the reports to be
provided by the Special Servicer.
SECTION 4.03. P&I Advances.
(a) On or before 2:00 p.m., New York City time, on each P&I Advance
Date, the Master Servicer shall (i) apply amounts in the Certificate Account
received after the end of the related Collection Period or otherwise held for
future distribution to Certificateholders in subsequent months in discharge of
its obligation to make P&I Advances, or (ii) if such amounts are insufficient to
discharge such obligation, subject to Section 4.03(c) below, remit from its own
funds to the Paying Agent for deposit into the Distribution Account an amount
equal to the aggregate amount of P&I Advances, if any, to be made in respect of
the related Distribution Date. The Master Servicer may also make P&I Advances in
the form of any combination of clauses (i) and (ii) above aggregating the total
amount of P&I Advances to be made. Any amounts held in the Certificate Account
for future distribution and so used to make P&I Advances shall be appropriately
reflected in the Master Servicer's records and replaced by the Master Servicer
by deposit in the Certificate Account on or before the next succeeding
Determination Date (to the extent not previously replaced through the deposit of
Late Collections of the delinquent principal and interest in respect of which
such P&I Advances were made). If, as of 3:00 p.m., New York City time, on any
P&I Advance Date, the Master Servicer shall not have made any P&I Advance
required to be made on such date pursuant to this Section 4.03(a) (and shall not
have delivered to the Trustee the requisite Officer's Certificate and
documentation related to a determination of nonrecoverability of a P&I Advance),
then the Trustee shall provide notice of such failure to a Servicing Officer of
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the Master Servicer by facsimile transmission sent to telecopy (704) 383-9356
(or such alternative number provided by the Master Servicer to the Trustee in
writing) and by telephone at telephone (704) 383-0535 (or such alternative
number provided by the Master Servicer to the Trustee in writing) as soon as
possible, but in any event before 4:00 p.m., New York City time, on such P&I
Advance Date. If the Trustee does not receive the full amount of such P&I
Advances by 10:00 a.m., New York City time, on the related Distribution Date,
then, subject to Section 4.03(c), (i) the Trustee shall, no later than 11:00
a.m., New York City time, on such related Distribution Date make the portion of
such P&I Advances that was required to be, but was not, made by the Master
Servicer on such P&I Advance Date, and (ii) the provisions of Sections 7.01 and
7.02 shall apply.
(b) The aggregate amount of P&I Advances to be made by the Master
Servicer or the Trustee in respect of any Distribution Date shall, subject to
Section 4.03(c) below, equal the aggregate of all Scheduled Payments (other than
Balloon Payments) and any Assumed Scheduled Payments, net of related Servicing
Fees and any related Principal Recovery Fees, due or deemed due, as the case may
be, in respect of the Mortgage Loans (including, without limitation, Balloon
Mortgage Loans delinquent as to their respective Balloon Payments) and any REO
Loans on their respective Due Dates during the related Collection Period, in
each case to the extent such amount was not paid by or on behalf of the related
Mortgagor or otherwise collected (including as net income from REO Properties)
as of the close of business on the related Determination Date; provided, that,
(i) if the Monthly Payment on any Mortgage Loan has been reduced in connection
with a bankruptcy or similar proceeding involving the related Mortgagor or a
modification, waiver or amendment granted or agreed to by the Special Servicer
pursuant to Section 3.20, or if the final maturity on any Mortgage Loan shall be
extended in connection with a bankruptcy or similar proceeding involving the
related Mortgagor or a modification, waiver or amendment granted or agreed to by
the Special Servicer pursuant to Section 3.20, and the Monthly Payment due and
owing during the extension period is less than the related Assumed Scheduled
Payment, then the Master Servicer or the Trustee shall, as to such Mortgage Loan
only, advance only the amount of the Monthly Payment due and owing after taking
into account such reduction (net of related Servicing Fees and any related
Principal Recovery Fees) in the event of subsequent delinquencies thereon; and
(ii) if it is determined that an Appraisal Reduction Amount exists with respect
to any Required Appraisal Loan, then, with respect to the Distribution Date
immediately following the date of such determination and with respect to each
subsequent Distribution Date for so long as such Appraisal Reduction Amount
exists with respect to such Required Appraisal Loan, the Master Servicer or the
Trustee will be required in the event of subsequent delinquencies to advance in
respect of such Mortgage Loan only an amount equal to the product of (A) the
amount of the P&I Advance that would otherwise be required without regard to
this clause (ii), multiplied by (B) a fraction, the numerator of which is equal
to the Stated Principal Balance of such Mortgage Loan, net of such Appraisal
Reduction Amount, and the denominator of which is equal to the Stated Principal
Balance of such Mortgage Loan.
(c) Notwithstanding anything herein to the contrary, no P&I Advance
shall be required to be made hereunder if such P&I Advance would, if made,
constitute a
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Nonrecoverable P&I Advance. The determination by the Master Servicer that it has
made a Nonrecoverable P&I Advance or that any proposed P&I Advance, if made,
would constitute a Nonrecoverable P&I Advance, shall be evidenced by an
Officers' Certificate delivered to the Trustee and the Depositor on or before
the related P&I Advance Date, setting forth the basis for such determination,
together with any other information, including Appraisals (or, if no such
Appraisal has been performed pursuant to this Section 4.03(c), a copy of an
Appraisal of the related Mortgaged Property performed within the twelve months
preceding such determination), related Mortgagor operating statements and
financial statements, budgets and rent rolls of the related Mortgaged
Properties, engineers' reports, environmental surveys and any similar reports
that the Master Servicer may have obtained consistent with the Servicing
Standard and at the expense of the Trust Fund, that support such determination
by the Master Servicer. The Trustee shall be entitled to rely, conclusively, on
any determination by the Master Servicer that a P&I Advance, if made, would be a
Nonrecoverable Advance (and with respect to a P&I Advance, the Trustee, as
applicable, shall rely on the Master Servicer's determination that the P&I
Advance would be a Nonrecoverable Advance if the Trustee determines that it does
not have sufficient time to make such determination); provided, however, that if
the Master Servicer has failed to make a P&I Advance for reasons other than a
determination by the Master Servicer that such P&I Advance would be
Nonrecoverable Advance, the Trustee shall make such Advance within the time
periods required by Section 4.03(a) unless the Trustee, in good faith, makes a
determination prior to the times specified in Section 4.03(a) that such P&I
Advance would be a Nonrecoverable Advance. The Trustee in determining whether or
not a P&I Advance previously made is, or a proposed P&I Advance, if made, would
be, a Nonrecoverable Advance shall be subject to the standards applicable to the
Master Servicer hereunder.
(d) In connection with the recovery by the Master Servicer or the
Trustee of any P&I Advance out of the Certificate Account pursuant to Section
3.05(a), subject to the next sentence, the Master Servicer shall be entitled to
pay itself or the Trustee, as the case may be, out of any amounts then on
deposit in the Certificate Account, interest at the Reimbursement Rate in effect
from time to time, compounded annually, accrued on the amount of such P&I
Advance from the date made (or, in the case of each Deemed Due Date Mortgage
Loan, the end of the grace period for the subject delinquent payment) to but not
including the date of reimbursement. The Master Servicer shall reimburse itself
or the Trustee, as applicable, for any outstanding P&I Advance made thereby as
soon as practicable after funds available for such purpose have been received by
the Master Servicer, and in no event shall interest accrue in accordance with
this Section 4.03(d) on any P&I Advance as to which the corresponding Late
Collection was received by the Master Servicer on or prior to the related P&I
Advance Date.
(e) In the case of each Deemed Due Date Mortgage Loan for the
purposes of Section 4.03 (b), the related Due Date shall be deemed to occur on
the first day of each month. Notwithstanding anything to the contrary set forth
in Section 4.03(d), interest will accrue on each P&I Advance made in respect of
any such Deemed Due Date Mortgage Loan
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from the end of the grace period for the related Scheduled Payment until such
P&I Advance is reimbursed.
SECTION 4.04. Allocation of Realized Losses and Additional
Trust Fund Expenses.
(a) On each Distribution Date, following all distributions to be
made on such date pursuant to Section 4.01, the Paying Agent shall allocate to
the respective Classes of Sequential Pay Certificates as follows the aggregate
of all Realized Losses and Additional Trust Fund Expenses that were incurred at
any time following the Cut-off Date through the end of the related Collection
Period, and in any event that were not previously allocated pursuant to this
Section 4.04(a) on any prior Distribution Date, but only to the extent that (i)
the aggregate Certificate Principal Balance of the Sequential Pay Certificates
as of such Distribution Date (after taking into account all of the distributions
made on such Distribution Date pursuant to Section 4.01), exceeds (ii) the
aggregate Stated Principal Balance of the Mortgage Pool that will be outstanding
immediately following such Distribution Date: first, to the Class N
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; second, to the Class M Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; third, to the Class L
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; fourth, to the Class K Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; fifth, to the Class J
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; sixth, to the Class H Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; seventh, to the Class G
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; eighth, to the Class F Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; ninth, to the Class E
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; tenth, to the Class D Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; eleventh, to the Class C
Certificates, until the remaining Class Principal Balance thereof has been
reduced to zero; twelfth, to the Class B Certificates, until the remaining Class
Principal Balance thereof has been reduced to zero; and thirteenth pro rata
(based on remaining Class Principal Balances) to the Class A-1 Certificates and
the Class A-2 Certificates, until the Class Principal Balances thereof are
reduced to zero. Any allocation of Realized Losses and Additional Trust Fund
Expenses to a Class of Regular Certificates shall be made by reducing the Class
Principal Balance thereof by the amount so allocated. All Realized Losses and
Additional Trust Fund Expenses, if any, allocated to a Class of Regular
Certificates shall be allocated among the respective Certificates of such Class
in proportion to the Percentage Interests evidenced thereby. All Realized Losses
and Additional Trust Fund Expenses, if any, that have not been allocated to the
Regular Certificates as of the Distribution Date on which the aggregate
Certificate Principal Balance of such Certificates has been reduced to zero,
shall be deemed allocated to the Residual Certificates.
(b) Each Realized Loss and Additional Trust Fund Expense, if any,
allocated to the Class A-1 Certificates on any Distribution Date shall be deemed
to have first
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been allocated to REMIC II Regular Interest M with a corresponding reduction in
the Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
A-2 Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest N with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
B Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest O with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
C Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest P with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
D Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest Q with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
E Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest R with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
F Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest S with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
G Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest T with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
H Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest U with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
J Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest V with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
K Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest W with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
L Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest X with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
M Certificates on any Distribution Date shall be deemed to have first been
allocated to REMIC II Regular Interest Y with a corresponding reduction in the
Uncertificated Principal Balance of such REMIC II Regular Interest; and each
Realized Loss and Additional Trust Fund Expense, if any, allocated to the Class
N Certificates
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on any Distribution Date shall be deemed to have first been allocated to REMIC
II Regular Interest Z with a corresponding reduction in the Uncertificated
Principal Balance of such REMIC II Regular Interest.
(c) On each Distribution Date, following the deemed distributions to
be made in respect of the REMIC I Regular Interests pursuant to Section 4.01(i),
the Uncertified Principal Balance of each REMIC I Regular Interest (after taking
account of such deemed distributions) shall be reduced to equal the Stated
Principal Balance of the related Mortgage Loan or REO Loan, as the case may be,
that will be outstanding immediately following such Distribution Date. Such
reductions shall be deemed to be an allocation of Realized Losses and Additional
Trust Fund Expenses.
SECTION 4.05. Calculations.
The Paying Agent shall, provided it receives the necessary
information from the Master Servicer and the Special Servicer, be responsible
for performing all calculations necessary in connection with the actual and
deemed distributions and allocations to be made pursuant to Section 4.01,
Section 5.02(d) and Article IX and the actual and deemed allocations of Realized
Losses and Additional Trust Fund Expenses to be made pursuant to Section 4.04.
The Paying Agent shall calculate the Available Distribution Amount for each
Distribution Date and shall allocate such amount among Certificateholders in
accordance with this Agreement, and the Paying Agent shall have no obligation to
recompute, recalculate or verify any information provided to it by the Special
Servicer or Master Servicer. The calculations by the Paying Agent of such
amounts shall, in the absence of manifest error, be presumptively deemed to be
correct for all purposes hereunder.
SECTION 4.06. Use of Agents.
The Master Servicer or the Trustee may at its own expense utilize
agents or attorneys-in-fact in performing any of its obligations under this
Article IV (except the obligation to make P&I Advances), but no such utilization
shall relieve the Master Servicer or the Trustee from any of such obligations,
and the Master Servicer or the Trustee, as applicable, shall remain responsible
for all acts and omissions of any such agent or attorney-in-fact (other than
with respect to limited powers-of-attorney delivered by the Trustee to the
Master Servicer or Special Servicer pursuant to Section 2.03(b) and 3.01(b), as
applicable, in which case the Trustee shall have no such responsibility). The
Master Servicer or the Trustee shall have all the limitations upon liability and
all the indemnities for the actions and omissions of any such agent or
attorney-in-fact that it has for its own actions hereunder pursuant to Article
VI or Article VIII hereof, as applicable, and any such agent or attorney-in-fact
shall have the benefit of all the limitations upon liability, if any, and all
the indemnities provided to the Master Servicer under Section 6.03 or to the
Trustee under Sections 8.01, 8.02 and 8.05, as applicable.
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ARTICLE V
THE CERTIFICATES
SECTION 5.01. The Certificates.
(a) The Certificates will be substantially in the respective forms
attached hereto as Exhibits A-1, A-2, A-4, A-5, A-6, A-7, A-8, A-9, A-10, A-11,
A-12, A-13, A-14, A-15, A-16, A-17, A-18 and A-19; provided that any of the
Certificates may be issued with appropriate insertions, omissions, substitutions
and variations, and may have imprinted or otherwise reproduced thereon such
legend or legends, not inconsistent with the provisions of this Agreement, as
may be required to comply with any law or with rules or regulations pursuant
thereto, or with the rules of any securities market in which the Certificates
are admitted to trading, or to conform to general usage. The Certificates will
be issuable in registered form only; provided, however, that in accordance with
Section 5.03 beneficial ownership interests in the Registered Certificates and
the Class F Certificates and Class G Certificates shall initially be held and
transferred through the book-entry facilities of the Depository. The Regular
Certificates will be issuable only in denominations corresponding to initial
Certificate Principal Balances or initial Certificate Notional Amounts, as the
case may be, as of the Closing Date of not less than $10,000 in the case of the
Registered Certificates (other than the Class IO Certificates), $100,000 in the
case of the Class IO Certificates, and $250,000 in the case of Non-Registered
Certificates (other than the Residual Certificates), and in each such case in
integral multiples of $1 in excess thereof. The Class R-I Certificates, the
Class R-II Certificates and the Class R-III Certificates shall have no minimum
denomination and shall each be represented by a single definitive certificate.
(b) The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee by the Certificate Registrar hereunder by an
authorized signatory. Certificates bearing the manual or facsimile signatures of
individuals who were at any time the authorized officers of the Certificate
Registrar shall be entitled to all benefits under this Agreement, subject to the
following sentence, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of such
Certificates or did not hold such offices at the date of such Certificates. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, however, unless there appears on such Certificate a certificate
of authentication substantially in the form provided for herein executed by the
Authenticating Agent by manual signature, and such certificate of authentication
upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication.
SECTION 5.02. Registration of Transfer and Exchange of Certificates.
(a) At all times during the term of this Agreement, there shall be
maintained at the office of the Certificate Registrar a Certificate Register in
which, subject to such
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reasonable regulations as the Certificate Registrar may prescribe, the
Certificate Registrar (located as of the Closing Date at Norwest Center, Sixth
and Marquette, Minneapolis, Minnesota 55479-0113), shall provide for the
registration of Certificates and of transfers and exchanges of Certificates as
herein provided. The Trustee is hereby initially appointed (and hereby agrees to
act in accordance with the terms hereof) as Certificate Registrar for the
purpose of registering Certificates and transfers and exchanges of Certificates
as herein provided. The Certificate Registrar may appoint, by a written
instrument delivered to the Depositor, the Trustee, the Special Servicer and (if
the Trustee is not the Certificate Registrar) the Master Servicer, any other
bank or trust company to act as Certificate Registrar under such conditions as
the predecessor Certificate Registrar may prescribe, provided that the
predecessor Certificate Registrar shall not be relieved of any of its duties or
responsibilities hereunder by reason of such appointment. If the Trustee resigns
or is removed in accordance with the terms hereof, the successor trustee shall
immediately succeed to its duties as Certificate Registrar. The Depositor, the
Trustee (if it is no longer the Certificate Registrar), the Master Servicer and
the Special Servicer shall have the right to inspect the Certificate Register or
to obtain a copy thereof at all reasonable times, and to rely conclusively upon
a certificate of the Certificate Registrar as to the information set forth in
the Certificate Register. Upon written request of any Certificateholder made for
purposes of communicating with other Certificateholders with respect to their
rights under this Agreement, the Certificate Registrar shall promptly furnish
such Certificateholder with a list of the other Certificateholders of record
identified in the Certificate Register at the time of the request.
(b) No transfer of any Non-Registered Certificate shall be made
unless that transfer is made pursuant to an effective registration statement
under the Securities Act, and effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. If such a transfer is to be made
without registration under the Securities Act (other than in connection with the
initial issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective Affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives (and upon receipt, may
conclusively rely upon) either: (i) a certificate from the Certificateholder
desiring to effect such transfer substantially in the form attached as Exhibit
G-1 hereto, and a certificate from such Certificateholder's prospective
transferee substantially in the form attached as either Exhibit G-2 hereto or as
Exhibit G-3 hereto; or (ii) an Opinion of Counsel reasonably satisfactory to the
Certificate Registrar to the effect that such transfer may be made without
registration under the Securities Act (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Master Servicer, the Special
Servicer, the Trustee or the Certificate Registrar in their respective
capacities as such), together with the written certification(s) as to the facts
surrounding such transfer from the Certificateholder desiring to effect such
transfer and/or such Certificateholder's prospective transferee on which such
Opinion of Counsel is based. None of the Depositor, the Trustee or the
Certificate Registrar is obligated to register or qualify any Class of
Non-Registered Certificates under the Securities Act or any other securities law
or to take any action not otherwise required under this Agreement to permit the
transfer of any Non-Registered Certificate without registration or
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qualification. Any Holder of a Non-Registered Certificate desiring to effect
such a transfer shall, and upon acquisition of such a Certificate shall be
deemed to have agreed to, indemnify the Trustee, the Certificate Registrar and
the Depositor against any liability that may result if the transfer is not so
exempt or is not made in accordance with such federal and state laws.
In connection with transfer of the Non-Registered Certificates, the
Depositor shall furnish upon request of a Certificateholder or Certificate Owner
to such Holder or Certificate Owner and any prospective purchaser designated by
such Certificateholder or Certificate Owner the information required to be
delivered under paragraph (d)(4) of Rule 144A of the Securities Act.
Notwithstanding the foregoing, for so long as any Non-Registered
Certificate is a Book-Entry Certificate, (a) each prospective transferor of such
Certificate shall be deemed to have represented to the Trustee, the Depositor
and the transferee of such Certificate the information set forth on Exhibit G-1
upon or prior to such transfer and (b) each prospective transferee of such
Certificate shall be deemed to have represented to the Trustee, the Depositor
and the transferor of such Certificate the information set forth on Exhibit G-2
or Exhibit G-3 upon or prior to such transfer.
(c) No transfer of a Subordinated Certificate or any interest
therein shall be made (A) to any employee benefit plan or other retirement
arrangement, including individual retirement accounts and annuities, Keogh plans
and collective investment funds and separate accounts in which such plans,
accounts or arrangements are invested, that is subject to ERISA or the Code
(each, a "Plan"), or (B) to any Person who is directly or indirectly purchasing
such Subordinated Certificate or interest therein on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan (including, without
limitation, any insurance company using assets in its general or separate
account that may constitute "plan assets" of a Plan); provided that (i) such a
transfer may be made to a Person using funds from an insurance company general
account with respect to any Class of Subordinated Certificates which is eligible
for exemptive relief under Section III of Prohibited Transaction Class Exemption
95-60 ("PTE 95-60"), provided that, in the case of a Definitive Certificate, the
proposed transferee certifies to the Trustee that the conditions of Sections I,
III and IV of PTE 95-60 are satisfied with respect to such transfer, and (ii)
such a transfer may also be made with respect to a Class F, Class G, Class H,
Class J, Class K, Class L, Class M or Class N Certificate (in the case of a
Class F or Class G Certificate, if Definitive Certificates are issue in respect
thereof), if the prospective transferee provides the Certificate Registrar with
a certification of facts and an Opinion of Counsel (upon which the Certificate
Registrar may conclusively rely) which establish to the reasonable satisfaction
of the Certificate Registrar that such transfer will not result in a violation
of Section 406 of ERISA or Section 4975 of the Code or result in the imposition
of an excise tax under Section 4975 of the Code. As a condition to its
registration of the transfer of a Subordinated Certificate, the Certificate
Registrar shall have the right to require the prospective transferee of such
Certificate, if it is not a Plan or Person described in clause (B) of the
preceding sentence, to execute a certification affidavit to that effect in the
form attached as Exhibit H hereto. Notwithstanding the foregoing, for so long as
any Class of Certificate
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constitutes a Class of Book-Entry Certificates, each prospective transferee of
such Certificate or any interest therein shall be deemed to have represented to
the Trustee, the Depositor and the transferor of such Certificate (i) the
information set forth on Exhibit H, (ii) that it is using funds from an
insurance company general account which is eligible for exemptive relief under
Section III of PTE 95-60 and the conditions of Section I, III and IV of PTE
95-60 are satisfied with respect to such transfer or (iii) that the purchase,
continued holding and transfer of such Certificate or interest therein will not
violate Section 406 of ERISA or Section 4975 of the Code or result in the
imposition of an excise tax under Section 4975 of the Code.
(d) (i) Each Person who has or who acquires any Ownership Interest
in a Residual Certificate shall be deemed by the acceptance or acquisition of
such Ownership Interest to have agreed to be bound by the following provisions
and to have irrevocably authorized the Paying Agent under clause (ii)(A) below
to deliver payments to a Person other than such Person and to have irrevocably
authorized the Certificate Registrar under clause (ii)(B) below to negotiate the
terms of any mandatory disposition and to execute all instruments of Transfer
and to do all other things necessary in connection with any such sale. The
rights of each Person acquiring any Ownership Interest in a Residual Certificate
are expressly subject to the following provisions:
(A) Each Person holding or acquiring any Ownership
Interest in a Residual Certificate shall be a Permitted
Transferee and shall promptly notify the Master Servicer, the
Paying Agent and the Certificate Registrar of any change or
impending change in its status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any
Ownership Interest in a Residual Certificate, the Certificate
Registrar shall require delivery to it, and shall not register
the Transfer of any Residual Certificate until its receipt of
an affidavit and agreement substantially in the form attached
hereto as Exhibit I-1 (in any case, a "Transfer Affidavit and
Agreement"), from the proposed Transferee, in form and
substance satisfactory to the Certificate Registrar, and upon
which the Certificate Registrar may, in the absence of actual
knowledge by a Responsible Officer of either the Trustee or
the Certificate Registrar to the contrary, conclusively rely,
representing and warranting, among other things, that such
Transferee is a Permitted Transferee, that it is not acquiring
its Ownership Interest in the Residual Certificate that is the
subject of the proposed Transfer as a nominee, trustee or
agent for any Person that is not a Permitted Transferee, that
for so long as it retains its Ownership Interest in a Residual
Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of this
Section 5.02(d) and agrees to be bound by them.
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(C) Notwithstanding the delivery of a Transfer Affidavit
and Agreement by a proposed Transferee under clause (B) above,
if a Responsible Officer of the Certificate Registrar has
actual knowledge that the proposed Transferee is not a
Permitted Transferee, no Transfer of an Ownership Interest in
a Residual Certificate to such proposed Transferee shall be
effected.
(D) Each Person holding or acquiring any Ownership
Interest in a Residual Certificate shall agree (1) to require
a Transfer Affidavit and Agreement from any prospective
Transferee to whom such Person attempts to transfer its
Ownership Interest in such Residual Certificate and (2) not to
transfer its Ownership Interest in such Residual Certificate
unless it provides to the Certificate Registrar a certificate
substantially in the form attached hereto as Exhibit I-2
stating that, among other things, it has no actual knowledge
that such prospective Transferee is not a Permitted
Transferee.
(E) Each Person holding or acquiring an Ownership
Interest in a Residual Certificate, by purchasing an Ownership
Interest in such Certificate, agrees to give the Master
Servicer and the Trustee written notice that it is a
"pass-through interest holder" within the meaning of temporary
Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring an Ownership Interest in a Residual
Certificate, if it is, or is holding an Ownership Interest in
a Residual Certificate on behalf of, a pass-through interest
holder".
(ii) (A) If any purported Transferee shall become a Holder of
a Residual Certificate in violation of the provisions of this
Section 5.02(d), then the last preceding Holder of such Residual
Certificate that was in compliance with the provisions of this
Section 5.02(d) shall be restored, to the extent permitted by law,
to all rights as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. None of
the Trustee, the Master Servicer or the Certificate Registrar shall
be under any liability to any Person for any registration of
Transfer of a Residual Certificate that is in fact not permitted by
this Section 5.02(d) or for making any payments due on such
Certificate to the Holder thereof or for taking any other action
with respect to such Holder under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of
a Residual Certificate in violation of the restrictions in this
Section 5.02(d), then, to the extent that the retroactive
restoration of the rights of the preceding Holder of such Residual
Certificate as described in clause (ii)(A) above shall be invalid,
illegal or unenforceable, the Certificate Registrar shall have the
right, without notice to the Holder or any prior Holder of such
Residual Certificate, to cause
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the transfer of such Residual Certificate to a Permitted Transferee
on such terms as the Certificate Registrar may choose. Such
purported Transferee shall promptly endorse and deliver such
Residual Certificate in accordance with the instructions of the
Certificate Registrar. Such Permitted Transferee may be the
Certificate Registrar itself or any Affiliate of the Certificate
Registrar. Any proceeds of such sale, net of the commissions (which
may include commissions payable to the Certificate Registrar or its
Affiliates), expenses and taxes due, if any, will be remitted by the
Paying Agent to such purported Transferee. The terms and conditions
of any sale under this clause (ii)(B) shall be determined in the
sole discretion of the Certificate Registrar, and the Certificate
Registrar shall not be liable to any Person having an Ownership
Interest in a Residual Certificate as a result of its exercise of
such discretion.
(iii) The Certificate Registrar shall make available to the
Internal Revenue Service and to those Persons specified by the REMIC
Provisions any information available to it which is necessary to
compute any tax imposed (A) as a result of the Transfer of an
Ownership Interest in a Residual Certificate to any Person who is a
Disqualified Organization, including the information described in
Treasury regulations sections 1.860D-1(b)(5) and 1.860E-2(a)(5) with
respect to the "excess inclusions" of such Residual Certificate and
(B) as a result of any regulated investment company, real estate
investment trust, common trust fund, partnership, trust, estate or
organization described in Section 1381 of the Code that holds an
Ownership Interest in a Residual Certificate having as among its
record holders at any time any Person which is a Disqualified
Organization, and the Master Servicer and the Special Servicer shall
furnish to the Certificate Registrar all information in its
possession necessary for the Certificate Registrar to discharge such
obligation. The Person holding such Ownership Interest shall be
responsible for the reasonable compensation of the Certificate
Registrar, the Master Servicer and the Special Servicer for
providing such information.
(iv) The provisions of this Section 5.02(d) set forth prior to
this clause (iv) may be modified, added to or eliminated, provided
that there shall have been delivered to the Certificate Registrar
and the Master Servicer the following:
(A) written confirmation from each Rating Agency to the
effect that the modification of, addition to or elimination of
such provisions will not cause such Rating Agency to qualify,
downgrade or withdraw its then-current rating of any Class of
Certificates; and
(B) an Opinion of Counsel, in form and substance
satisfactory to the Certificate Registrar and the Master
Servicer, obtained at the expense of the party seeking such
modification of, addition to or
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elimination of such provisions (but in no event at the expense
of the Trust or the Trust Fund), to the effect that doing so
will not cause either of REMIC I, REMIC II or REMIC III to (x)
cease to qualify as a REMIC or (y) be subject to an
entity-level tax caused by the Transfer of any Residual
Certificate to a Person which is not a Permitted Transferee,
or cause a Person other than the prospective Transferee to be
subject to a REMIC-related tax caused by the Transfer of a
Residual Certificate to a Person that is not a Permitted
Transferee.
(e) Subject to the preceding provisions of this Section 5.02, upon
surrender for registration of transfer of any Certificate at the offices of the
Certificate Registrar maintained for such purpose, the Certificate Registrar
shall execute and the Authenticating Agent shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Certificates of the same Class of a like aggregate Percentage Interest.
(f) At the option of any Holder, its Certificates may be exchanged
for other Certificates of authorized denominations of the same Class of a like
aggregate Percentage Interest, upon surrender of the Certificates to be
exchanged at the offices of the Certificate Registrar maintained for such
purpose. Whenever any Certificates are so surrendered for exchange, the
Certificate Registrar shall execute and the Authenticating Agent shall
authenticate and deliver the Certificates which the Certificateholder making the
exchange is entitled to receive.
(g) Every Certificate presented or surrendered for transfer or
exchange shall (if so required by the Certificate Registrar) be duly endorsed
by, or be accompanied by a written instrument of transfer in the form
satisfactory to the Certificate Registrar duly executed by, the Holder thereof
or his attorney duly authorized in writing.
(h) No service charge shall be imposed for any transfer or exchange
of Certificates, but the Certificate Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(i) All Certificates surrendered for transfer and exchange shall be
physically canceled by the Certificate Registrar, and the Certificate Registrar
shall dispose of such canceled Certificates in accordance with its standard
procedures.
(j) Upon request, the Certificate Registrar shall provide to the
Master Servicer, the Special Servicer and the Depositor notice of each transfer
of a Certificate and shall provide to each such Person with an updated copy of
the Certificate Register.
SECTION 5.03. Book-Entry Certificates.
(a) Each Class of Registered Certificates and the Class F and Class
G Certificates shall initially be issued as one or more Certificates registered
in the name of the
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Depository or its nominee and, except as provided in Section 5.03(c) below,
transfer of such Certificates may not be registered by the Certificate Registrar
unless such transfer is to a successor Depository that agrees to hold such
Certificates for the respective Certificate Owners with Ownership Interests
therein. Such Certificate Owners shall hold and transfer their respective
Ownership Interests in and to such Certificates through the book-entry
facilities of the Depository and, except as provided in Section 5.03(c) below,
shall not be entitled to definitive, fully registered Certificates ("Definitive
Certificates") in respect of such Ownership Interests. All transfers by
Certificate Owners of their respective Ownership Interests in the Book-Entry
Certificates shall be made in accordance with the procedures established by the
Depository Participant or brokerage firm representing each such Certificate
Owner. Each Depository Participant shall only transfer the Ownership Interests
in the Book-Entry Certificates of Certificate Owners it represents or of
brokerage firms for which it acts as agent in accordance with the Depository's
normal procedures.
(b) The Trustee, the Master Servicer, the Special Servicer, the
Depositor and the Certificate Registrar may for all purposes, including the
making of payments due on the Book-Entry Certificates, deal with the Depository
as the authorized representative of the Certificate Owners with respect to such
Certificates for the purposes of exercising the rights of Certificateholders
hereunder. The rights of Certificate Owners with respect to the Book-Entry
Certificates shall be limited to those established by law and agreements between
such Certificate Owners and the Depository Participants and brokerage firms
representing such Certificate Owners. Multiple requests and directions from, and
votes of, the Depository as Holder of the Book-Entry Certificates with respect
to any particular matter shall not be deemed inconsistent if they are made with
respect to different Certificate Owners. The Trustee may establish a reasonable
record date in connection with solicitations of consents from or voting by
Certificateholders and shall give notice to the Depository of such record date.
(c) If (i)(A) the Depositor advises the Trustee and the Certificate
Registrar in writing that the Depository is no longer willing or able to
properly discharge its responsibilities with respect to a Class of the
Book-Entry Certificates, and (B) the Depositor is unable to locate a qualified
successor, or (ii) the Depositor at its option advises the Trustee and the
Certificate Registrar in writing that it elects to terminate the book-entry
system through the Depository with respect to a Class of Book-Entry
Certificates, the Certificate Registrar shall notify all affected Certificate
Owners, through the Depository, of the occurrence of any such event and of the
availability of Definitive Certificates to such Certificate Owners requesting
the same. Upon surrender to the Certificate Registrar of the Book-Entry
Certificates of any Class thereof by the Depository, accompanied by registration
instructions from the Depository for registration of transfer, the Certificate
Registrar shall execute, at the Depositor's expense, and the Authenticating
Agent shall authenticate and deliver, the Definitive Certificates in respect of
such Class to the Certificate Owners identified in such instructions. The
Depositor shall provide the Certificate Registrar with an adequate inventory of
Definitive Certificates. None of the Depositor, the Master Servicer, the Special
Servicer, the Trustee or the Certificate Registrar shall be liable for any delay
in delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of
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Definitive Certificates for purposes of evidencing ownership of any Class of
Registered Certificates, the registered holders of such Definitive Certificates
shall be recognized as Certificateholders hereunder and, accordingly, shall be
entitled directly to receive payments on, to exercise Voting Rights with respect
to, and to transfer and exchange such Definitive Certificates.
(d) Notwithstanding any other provisions contained herein, neither
the Trustee nor the Certificate Registrar shall have any responsibility
whatsoever to monitor or restrict the transfer of ownership interests in any
Certificate (including but not limited to any Non-Registered Certificate or any
Subordinated Certificate) which interests are transferable through the
book-entry facilities of the Depository.
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (ii) there is delivered
to the Trustee and the Certificate Registrar such security or indemnity as may
be required by them to save each of them harmless, then, in the absence of
actual notice to the Trustee or the Certificate Registrar that such Certificate
has been acquired by a bona fide purchaser, the Certificate Registrar shall
execute and the Authenticating Agent shall authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a
new Certificate of the same Class and like Percentage Interest. Upon the
issuance of any new Certificate under this Section, the Trustee and the
Certificate Registrar may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee and the
Certificate Registrar) connected therewith. Any replacement Certificate issued
pursuant to this Section shall constitute complete and indefeasible evidence of
ownership in the applicable REMIC created hereunder, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.
SECTION 5.05. Persons Deemed Owners.
Prior to due presentment for registration of transfer, the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the
Certificate Registrar and any agent of any of them may treat the Person in whose
name any Certificate is registered as the owner of such Certificate for the
purpose of receiving distributions pursuant to Section 4.01 and for all other
purposes whatsoever and none of the Depositor, the Master Servicer, the Special
Servicer, the Trustee, the Certificate Registrar or any agent of any of them
shall be affected by notice to the contrary.
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ARTICLE VI
THE DEPOSITOR, THE MASTER SERVICER, THE SPECIAL SERVICER
AND THE CONTROLLING CLASS REPRESENTATIVE
SECTION 6.01. Liability of Depositor, Master Servicer and Special
Servicer.
The Depositor, the Master Servicer and the Special Servicer shall be
liable in accordance herewith only to the extent of the respective obligations
specifically imposed upon and undertaken by the Depositor, the Master Servicer
and the Special Servicer herein.
SECTION 6.02. Merger, Consolidation or Conversion of Depositor or
Master Servicer or Special Servicer.
Subject to the following paragraph, the Depositor and the Special
Servicer shall each keep in full effect its existence, rights and franchises as
a corporation under the laws of the jurisdiction of its incorporation or
organization, and each will obtain and preserve its qualification to do business
as a foreign corporation in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of this Agreement,
the Certificates or any of the Mortgage Loans and to perform its respective
duties under this Agreement, and the Master Servicer shall keep in full effect
its existence and rights as a national banking association under the laws of the
United States.
The Depositor, the Master Servicer or the Special Servicer may be
merged or consolidated with or into any Person, or transfer all or substantially
all of its assets (which may be limited to all or substantially all of its
assets related to commercial mortgage loan servicing) to any Person, in which
case any Person resulting from any merger or consolidation to which the
Depositor, the Master Servicer or the Special Servicer shall be a party, or any
Person succeeding to the business (which may be limited to the commercial loan
servicing business) of the Depositor, the Master Servicer or the Special
Servicer, shall be the successor of the Depositor, the Master Servicer or the
Special Servicer, as the case may be, hereunder, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that no
successor or surviving Person shall succeed to the rights of the Master Servicer
or the Special Servicer unless (i) as evidenced in writing by the Rating
Agencies, such succession will not result in qualification, downgrading or
withdrawal of the ratings then assigned by the Rating Agencies to any Class of
Certificates; (ii) such successor or surviving Person makes the applicable
representations and warranties set forth in Section 3.23; (iii) in the case of a
successor or surviving Person to the Master Servicer, such successor or
surviving Person shall have a net worth (or, in the case of the initial Master
Servicer, such successor or surviving Person and its immediate parent shall have
a consolidated net worth) of not less than $15,000,000; and (iv) in the case of
a successor or surviving Person to the Master Servicer, it is determined by the
Trustee in its reasonable judgment to have, after the merger, consolidation or
transfer, as the
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case may be, financial and servicing capabilities comparable to that of the
predecessor Master Servicer.
SECTION 6.03. Limitation on Liability of Depositor, Master
Servicer and Special Servicer.
None of the Depositor, the Master Servicer or the Special Servicer
shall be under any liability to the Trust Fund, the Trustee or the
Certificateholders for any action taken, or not taken, in good faith pursuant to
this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Depositor, the Master Servicer or the Special
Servicer against any liability to the Trust Fund, the Trustee or the
Certificateholders for the breach of a representation, warranty or covenant made
herein by such party, or against any expense or liability specifically required
to be borne by such party without right of reimbursement pursuant to the terms
hereof, or against any liability which would otherwise be imposed by reason of
misfeasance, bad faith or negligence in the performance of obligations or duties
hereunder. The Depositor, the Master Servicer, the Special Servicer and any
director, officer, employee or agent of the Depositor, the Master Servicer or
the Special Servicer may rely in good faith on any document of any kind which,
prima facie, is properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor, the Master Servicer, the Special
Servicer and any director, officer, employee or agent of the Depositor, the
Master Servicer or the Special Servicer shall be indemnified and held harmless
by the Trust Fund against any loss, liability or reasonable expense incurred in
connection with this Agreement or the Certificates, other than any loss,
liability or expense: (i) specifically required to be borne by such party
without right of reimbursement pursuant to the terms hereof (including without
limitation, those expenses set forth in Section 3.11(b) and the last sentence of
the definition of Servicing Advances); (iii) incurred in connection with any
breach of a representation, warranty or covenant made herein; or (iv) incurred
by reason of willful misfeasance, bad faith or negligence in the performance of
obligations or duties hereunder. None of the Depositor, the Master Servicer or
the Special Servicer shall be under any obligation to appear in, prosecute or
defend any legal action unless such action is related to its respective duties
under this Agreement and, unless it is specifically required hereunder to bear
the costs of such legal action, in its opinion does not involve it in any
ultimate expense or liability; provided, however, that the Depositor, the Master
Servicer or the Special Servicer may in its discretion undertake any such action
which it may deem necessary or desirable with respect to the enforcement and/or
protection of the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, the legal expenses and costs of
such action, and any liability resulting therefrom, shall be expenses, costs and
liabilities of the Trust Fund, and the Depositor, the Master Servicer and the
Special Servicer shall be entitled to be reimbursed therefor from the
Certificate Account as provided in Section 3.05. In no event shall the Master
Servicer or the Special Servicer be liable or responsible for any action taken
or omitted to be taken by the other of them or by the Depositor, the Trustee or
any Certificateholder, subject to the provisions of the last paragraph of
Section 8.05.
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SECTION 6.04. Resignation of Master Servicer and the Special
Servicer.
The Master Servicer and, subject to Section 6.09, the Special
Servicer may resign from the obligations and duties hereby imposed on it, upon a
determination that its duties hereunder are no longer permissible under
applicable law or are in material conflict by reason of applicable law with any
other activities carried on by it (the other activities of the Master Servicer
or the Special Servicer, as the case may be, so causing such a conflict being of
a type and nature carried on by the Master Servicer or the Special Servicer, as
the case may be, at the date of this Agreement). Any such determination
requiring the resignation of the Master Servicer or the Special Servicer, as
applicable, shall be evidenced by an Opinion of Counsel to such effect which
shall be delivered to the Trustee. Unless applicable law requires the Master
Servicer's or Special Servicer's resignation to be effective immediately, and
the Opinion of Counsel delivered pursuant to the prior sentence so states, no
such resignation shall become effective until the Trustee or other successor
shall have assumed the responsibilities and obligations of the resigning party
in accordance with Section 7.02 hereof. The Master Servicer and the Special
Servicer shall have the right to resign at any other time provided that (i) a
willing successor thereto has been found, (ii) each of the Rating Agencies
confirms in writing that the successor's appointment will not result in a
withdrawal, qualification or downgrade of any rating or ratings assigned to any
Class of Certificates, (iii) the resigning party pays all costs and expenses in
connection with such transfer, and (iv) the successor accepts appointment prior
to the effectiveness of such resignation. Neither the Master Servicer nor the
Special Servicer shall be permitted to resign except as contemplated above in
this Section 6.04.
Consistent with the foregoing, neither the Master Servicer nor the
Special Servicer shall, except as expressly provided herein, assign or transfer
any of its rights, benefits or privileges hereunder to any other Person, or,
except as provided in Sections 3.22 and 4.06, delegate to or subcontract with,
or authorize or appoint any other Person to perform any of the duties, covenants
or obligations to be performed by it hereunder. If, pursuant to any provision
hereof, the duties of the Master Servicer or the Special Servicer are
transferred to a successor thereto, the Master Servicing Fee, the Additional
Servicing Fee or the Special Servicing Fee, as the case may be, that accrues
pursuant hereto from and after the date of such transfer shall be payable to
such successor.
SECTION 6.05. Rights of Depositor and Trustee in Respect of
Master Servicer and the Special Servicer.
The Master Servicer and the Special Servicer shall each afford the
Depositor, the Underwriters and the Trustee, upon reasonable notice, during
normal business hours access to all records maintained thereby in respect of its
rights and obligations hereunder and access to officers thereof responsible for
such obligations. Upon reasonable request, the Master Servicer and the Special
Servicer shall each furnish the Depositor, the Underwriters and the Trustee with
its most recent financial statements and such other information as it possesses,
and which it is not prohibited by applicable law or contract from disclosing,
regarding its
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business, affairs, property and condition, financial or otherwise, except to the
extent such information constitutes proprietary information or is subject to a
privilege under applicable law. The Depositor may, but is not obligated to,
enforce the obligations of the Master Servicer and the Special Servicer
hereunder and may, but is not obligated to, perform, or cause a designee to
perform, any defaulted obligation of the Master Servicer or Special Servicer
hereunder or exercise the rights of the Master Servicer and the Special Servicer
hereunder; provided, however, that neither the Master Servicer nor the Special
Servicer shall be relieved of any of its obligations hereunder by virtue of such
performance by the Depositor or its designee and, further provided, that the
Depositor may not exercise any right pursuant to Section 7.01 to terminate the
Master Servicer or the Special Servicer as a party to this Agreement. The
Depositor shall not have any responsibility or liability for any action or
failure to act by the Master Servicer or the Special Servicer and is not
obligated to supervise the performance of the Master Servicer or the Special
Servicer under this Agreement or otherwise.
SECTION 6.06. Depositor, Master Servicer and Special Servicer
to Cooperate with Trustee.
The Depositor, the Master Servicer and the Special Servicer shall
each furnish such reports, certifications and information as are reasonably
requested by the Trustee in order to enable it to perform its duties hereunder.
SECTION 6.07. Depositor, Special Servicer and Trustee to Cooperate
with Master Servicer.
The Depositor, the Special Servicer and the Trustee shall each
furnish such reports, certifications and information as are reasonably requested
by the Master Servicer in order to enable it to perform its duties hereunder.
SECTION 6.08. Depositor, Master Servicer and Trustee to Cooperate
with Special Servicer.
The Depositor, the Master Servicer and the Trustee shall each
furnish such reports, certifications and information as are reasonably requested
by the Special Servicer in order to enable it to perform its duties hereunder.
SECTION 6.09. Designation of Special Servicer by the Controlling
Class.
The Holder or Holders of the Certificates evidencing a majority of
the Voting Rights allocated to the Controlling Class may at any time and from
time to time designate a Person meeting the requirements set forth in Section
6.02 to serve as Special Servicer hereunder and to replace any existing Special
Servicer or any Special Servicer that has resigned or otherwise ceased to serve
as Special Servicer. Such Holder or Holders may also select a representative
(the "Controlling Class Representative") from whom the Special Servicer will
seek advice and approval and take direction under certain circumstances, as
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described herein. Such Holder or Holders shall so designate a Person to serve as
replacement Special Servicer by the delivery to the Trustee, the Master Servicer
and the existing Special Servicer of a written notice stating such designation.
The Trustee shall, promptly after receiving any such notice, deliver to the
Rating Agencies an executed Notice and Acknowledgment in the form attached
hereto as Exhibit J-1. If such Holders have not replaced the Special Servicer
within 30 days of such Special Servicer's resignation or the date such Special
Servicer has ceased to serve in such capacity, the Trustee shall designate a
successor Special Servicer meeting the requirements set forth in Section 6.02.
Any designated Person shall become the Special Servicer, subject to satisfaction
of the other conditions set forth below, on the date that the Trustee shall have
received written confirmation from all of the Rating Agencies that the
appointment of such Person will not result in the qualification, downgrading or
withdrawal of the rating or ratings assigned to one or more Classes of the
Certificates. The appointment of such designated Person as Special Servicer
shall also be subject to receipt by the Trustee of (1) an Acknowledgment of
Proposed Special Servicer in the form attached hereto as Exhibit J-2, executed
by the designated Person, and (2) an Opinion of Counsel (at the expense of the
Person designated to become the Special Servicer) to the effect that the
designation of such Person to serve as Special Servicer is in compliance with
this Section 6.09 and all other applicable provisions of this Agreement, that
upon the execution and delivery of the Acknowledgment of Proposed Special
Servicer the designated Person shall be bound by the terms of this Agreement and
that this Agreement shall be enforceable against the designated Person in
accordance with its terms. Any existing Special Servicer shall be deemed to have
resigned simultaneously with such designated Person's becoming the Special
Servicer hereunder; provided, however, that the resigning Special Servicer shall
continue to be entitled to receive all amounts accrued or owing to it under this
Agreement on or prior to the effective date of such resignation, whether in
respect of Servicing Advances or otherwise, and it shall continue to be entitled
to the benefits of Section 6.03 notwithstanding any such resignation. Such
resigning Special Servicer shall cooperate with the Trustee and the replacement
Special Servicer in effecting the termination of the resigning Special
Servicer's responsibilities and rights hereunder, including, without limitation,
the transfer within two Business Days to the replacement Special Servicer for
administration by it of all cash amounts that shall at the time be or should
have been credited by the Special Servicer to the Certificate Account or the REO
Account or delivered to the Master Servicer or that are thereafter received with
respect to Specially Serviced Mortgage Loans and REO Properties.
SECTION 6.10. Master Servicer or Special Servicer as Owner of a
Certificate.
The Master Servicer or an Affiliate of the Master Servicer or the
Special Servicer or an Affiliate of the Special Servicer may become the Holder
of (or, in the case of a Book-Entry Certificate, Certificate Owner with respect
to) any Certificate with (except as set forth in the definition of
"Certificateholder") the same rights it would have if it were not the Master
Servicer or the Special Servicer or an Affiliate thereof. If, at any time during
which the Master Servicer or the Special Servicer or an Affiliate of the Master
Servicer or the Special Servicer is the Holder of (or, in the case of a
Book-Entry Certificate, Certificate Owner with
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respect to) any Certificate, the Master Servicer or the Special Servicer
proposes to take action (including for this purpose, omitting to take action)
that (i) is not expressly prohibited by the terms hereof and would not, in the
Master Servicer's or the Special Servicer's good faith judgment, violate the
Servicing Standard, and (ii) if taken, might nonetheless, in the Master
Servicer's or the Special Servicer's reasonable, good faith judgment, be
considered by other Persons to violate the Servicing Standard, then the Master
Servicer or the Special Servicer may (but need not) seek the approval of the
Certificateholders to such action by delivering to the Trustee a written notice
that (a) states that it is delivered pursuant to this Section 6.10, (b)
identifies the Percentage Interest in each Class of Certificates beneficially
owned by the Master Servicer or the Special Servicer or an Affiliate of the
Master Servicer or the Special Servicer, and (c) describes in reasonable detail
the action that the Master Servicer or the Special Servicer proposes to take.
The Trustee, upon receipt of such notice, shall forward it to the
Certificateholders (other than the Master Servicer and its Affiliates or the
Special Servicer and its Affiliates, as appropriate), together with such
instructions for response as the Trustee shall reasonably determine. If at any
time Certificateholders holding greater than 50% of the Voting Rights of all
Certificateholders (calculated without regard to the Certificates beneficially
owned by the Master Servicer or its Affiliates or the Special Servicer or its
Affiliates) shall have failed to object in writing to the proposal described in
the written notice, and if the Master Servicer or the Special Servicer shall act
as proposed in the written notice within thirty (30) days, such action shall be
deemed to comply with, but not modify, the Servicing Standard. The Trustee shall
be entitled to reimbursement from the Master Servicer or the Special Servicer,
as applicable, for the reasonable expenses of the Trustee incurred pursuant to
this paragraph. It is not the intent of the foregoing provision that the Master
Servicer or the Special Servicer be permitted to invoke the procedure set forth
herein with respect to routine servicing matters arising hereunder, but rather
in the case of unusual circumstances.
SECTION 6.11. The Controlling Class Representative.
The Controlling Class Representative will be entitled to advise the
Special Servicer with respect to the following actions of the Special Servicer,
and notwithstanding anything herein to the contrary except as set forth in, and
in any event subject to, the second paragraph of this Section 6.11, the Special
Servicer will not be permitted to take any of the following actions as to which
the Controlling Class Representative has objected in writing within ten Business
Days of being notified thereof (provided that if such written objection has not
been received by the Special Servicer within such ten Business Day period, then
the Controlling Class Representative's approval will be deemed to have been
given):
(i) any foreclosure upon or comparable conversion (which may
include acquisitions of an REO Property) of the ownership of
properties securing such of the Specially Serviced Mortgage Loans as
come into and continue in default;
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(ii) any modification of a monetary term of a Mortgage Loan
other than a modification consisting of the extension of the
maturity date of a Mortgage Loan for one year or less;
(iii) any proposed sale of a defaulted Mortgage Loan or REO
Property (other than in connection with the termination of the Trust
Fund);
(iv) any determination to bring an REO Property into
compliance with applicable environmental laws or to otherwise
address Hazardous Materials located at an REO Property;
(v) any acceptance of substitute or additional collateral for
a Mortgage Loan;
(vi) any waiver of a "due-on-sale" or "due-on-encumbrance"
clause; and
(vii) any acceptance of an assumption agreement releasing a
borrower from liability under a Mortgage Loan.
In addition, the Controlling Class Representative may direct the
Special Servicer to take, or to refrain from taking, such other actions as the
Controlling Class Representative may deem advisable or as to which provision is
otherwise made herein; provided that notwithstanding anything herein to the
contrary no such direction, and no objection contemplated by the preceding
paragraph, may require or cause the Special Servicer to violate any provision of
this Agreement or the REMIC Provisions, including without limitation the Special
Servicer's obligation to act in accordance with the Servicing Standard, or
expose the Master Servicer, the Special Servicer, the Trust Fund or the Trustee
to liability, or materially expand the scope of the Special Servicer's
responsibilities hereunder or cause the Special Servicer to act, or fail to act,
in a manner which in the reasonable judgment of the Special Servicer is not in
the best interests of the Certificateholders.
The Controlling Class Representative will have no liability to the
Certificateholders for any action taken, or for refraining from the taking of
any action, in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that the Controlling Class Representative will not be
protected against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations or duties. By its acceptance of a
Certificate, each Certificateholder confirms its understanding that the
Controlling Class Representative may take actions that favor the interests of
one or more Classes of the Certificates over other Classes of the Certificates,
and that the Controlling Class Representative may have special relationships and
interests that conflict with those of Holders of some Classes of the
Certificates; and, absent willful misfeasance, bad faith or negligence on the
part of the Controlling Class Representative, agrees to take no action against
the
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Controlling Class Representative or any of its officers, directors, employees,
principals or agents as a result of such a special relationship or conflict.
ARTICLE VII
DEFAULT
SECTION 7.01. Events of Default.
(a) "Event of Default", wherever used herein, means any one of the
following events:
(i) any failure by the Master Servicer to deposit into the
Certificate Account, or to deposit into, or remit to the Paying
Agent for deposit into, the Distribution Account, any amount (other
than a P&I Advance) required to be so deposited or remitted by it
under this Agreement; provided, however, that if such failure to
deposit or remit occurs only once in any consecutive twelve-month
period, which failure is corrected by 10:00 a.m., New York City time
on the related Distribution Date, then with respect to such one
failure only, a default shall be deemed not to have occurred; or
(ii) any failure by the Special Servicer to deposit into the
REO Account or to deposit into, or to remit to the Master Servicer
for deposit into, the Certificate Account, any amount required to be
so deposited or remitted under this Agreement; or
(iii) any failure by the Master Servicer or the Special
Servicer to timely make any Servicing Advance required to be made by
it hereunder, which Servicing Advance remains unmade for a period of
three Business Days following the date on which notice shall have
been given to the Master Servicer or the Special Servicer, as the
case may be, by the Trustee as provided in Section 3.03(c); or
(iv) any failure on the part of the Master Servicer or the
Special Servicer duly to observe or perform in any material respect
any other of the covenants or agreements on the part of the Master
Servicer or the Special Servicer, as the case may be, contained in
this Agreement which continues unremedied for a period of 30 days
after the date on which written notice of such failure, requiring
the same to be remedied, shall have been given to the Master
Servicer and the Special Servicer, as the case may be, by any other
party hereto or to the Master Servicer or the Special Servicer, as
the case may be (with a copy to each other party hereto), by the
Holders of Certificates entitled to at least 25% of the Voting
Rights, provided, however, that with respect to
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any such failure which is not curable within such 30-day period, the
Master Servicer or the Special Servicer, as the case may be, shall
have an additional cure period of thirty (30) days to effect such
cure so long as the Master Servicer or the Special Servicer, as the
case may be, has commenced to cure such failure within the initial
30-day period and has provided the Trustee with an Officer's
Certificate certifying that it has diligently pursued, and is
continuing to pursue, a full cure; or
(v) any breach on the part of the Master Servicer or the
Special Servicer of any representation or warranty contained in this
Agreement that materially and adversely affects the interests of any
Class of Certificateholders and which continues unremedied for a
period of 30 days after the date on which notice of such breach,
requiring the same to be remedied, shall have been given to the
Master Servicer or the Special Servicer, as the case may be, by any
other party hereto or to the Master Servicer or the Special
Servicer, as the case may be (with a copy to each other party
hereto), by the Holders of Certificates entitled to at least 25% of
the Voting Rights, provided, however, that with respect to any
failure which is not curable within such 30-day period, the Master
Servicer or the Special Servicer, as the case may be, shall have an
additional cure period of thirty (30) days so long as the Master
Servicer or the Special Servicer, as the case may be, has commenced
to cure within the initial 30-day period and provided the Trustee
with an Officer's Certificate certifying that it has diligently
pursued, and is continuing to pursue, a full cure; or
(vi) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an involuntary case
under any present or future federal or state bankruptcy, insolvency
or similar law for the appointment of a conservator, receiver,
liquidator, trustee or similar official in any bankruptcy,
insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the
Master Servicer or the Special Servicer and such decree or order
shall have remained in force undischarged or unstayed for a period
of 60 days; or
(vii) the Master Servicer or the Special Servicer shall
consent to the appointment of a conservator, receiver, liquidator,
trustee or similar official in any bankruptcy, insolvency,
readjustment of debt, marshaling of assets and liabilities or
similar proceedings of or relating to it or of or relating to all or
substantially all of its property; or
(viii) the Master Servicer or the Special Servicer shall admit
in writing its inability to pay its debts generally as they become
due, file a petition to take advantage of any applicable bankruptcy,
insolvency or reorganization statute, make an assignment for the
benefit of its creditors, voluntarily suspend payment
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of its obligations, or take any corporate action in furtherance of
the foregoing; or
(ix) the consolidated net worth of the Master Servicer and of
its direct or indirect parent, determined in accordance with
generally accepted accounting principles, shall decline to less than
$15,000,000; or
(x) the Trustee shall have received a written notice from a
Rating Agency (which the Trustee shall promptly forward to the
Master Servicer or the Special Servicer as the case may be) to the
effect that if the Master Servicer or Special Servicer continues to
act in such capacity, the rating or ratings on one or more Classes
of Certificates will be qualified, downgraded or withdrawn and the
Trustee shall not have received a subsequent notice from such Rating
Agency (within 90 days of receipt of the first notice) indicating
anything to the contrary (and upon the 91st day the provisions of
Section 7.01(b) shall apply); or
(xi) the Master Servicer shall fail to remit to the Paying
Agent for deposit into the Distribution Account, on any P&I Advance
Date, the full amount of P&I Advances required to be made on such
date, which failure continues unremedied until 10:00 a.m. New York
City time on the next Business Day succeeding such P&I Advance Date.
When a single entity acts as the Master Servicer and the Special Servicer, an
Event of Default in one capacity shall constitute an Event of Default in the
other capacity.
(b) If any Event of Default described in clauses (i) - (ix) of
subsection (a) above shall occur with respect to the Master Servicer or the
Special Servicer (in either case, for purposes of this Section 7.01(b), the
"Defaulting Party") and shall be continuing, then, and in each and every such
case, so long as such Event of Default shall not have been remedied, the Trustee
may, and at the written direction of the Holders of Certificates entitled to at
least 25% of the Voting Rights, the Trustee shall, by notice in writing to the
Defaulting Party (with a copy of such notice to each other party hereto and the
Rating Agencies) terminate all of the rights and obligations (but not the
liabilities for actions and omissions occurring prior thereto) of the Defaulting
Party under this Agreement and in and to the Trust Fund, other than its rights
as a Certificateholder hereunder. If an Event of Default described in clause (x)
or (xi) of subsection (a) above shall occur with respect to the Master Servicer
or, if applicable, the Special Servicer (in either case, under such
circumstances, for purposes of this Section 7.01(b), the "Defaulting Party"),
the Trustee shall, by notice in writing (to be sent immediately by facsimile
transmission) to the Defaulting Party (with a copy of such notice to each other
party hereto and the Rating Agencies), terminate all of the rights and
obligations (but not the liabilities for actions and omissions occurring prior
thereto) of the Defaulting Party under this Agreement and in and to the Trust
Fund, other than its rights, if any, as a Certificateholder hereunder. From and
after the receipt by the Defaulting Party of such
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written notice of termination, all authority and power of the Defaulting Party
under this Agreement, whether with respect to the Certificates (other than as a
holder of any Certificate) or the Mortgage Loans or otherwise, shall pass to and
be vested in the Trustee pursuant to and under this Section, and, without
limitation, the Trustee is hereby authorized and empowered to execute and
deliver, on behalf of and at the expense of the Defaulting Party, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. The Master Servicer and the Special Servicer each agree that, if it
is terminated pursuant to this Section 7.01(b), it shall promptly (and in any
event no later than ten Business Days subsequent to its receipt of the notice of
termination) provide the Trustee with all documents and records, including those
in electronic form, requested thereby to enable the Trustee to assume the Master
Servicer's or Special Servicer's, as the case may be, functions hereunder, and
shall cooperate with the Trustee in effecting the termination of the Master
Servicer's or Special Servicer's, as the case may be, responsibilities and
rights hereunder, including, without limitation, (i) the immediate transfer to
the Trustee or a successor Master or Special Servicer for administration by it
of all cash amounts that shall at the time be or should have been credited by
the Master Servicer to the Certificate Account, the Distribution Account, a
Servicing Account or a Reserve Account (if the Master Servicer is the Defaulting
Party) or that are thereafter received by or on behalf of it with respect to any
Mortgage Loan or (ii) the transfer within two Business Days to the Trustee or a
successor Special Servicer for administration by it of all cash amounts that
shall at the time be or should have been credited by the Special Servicer to the
REO Account, the Certificate Account, a Servicing Account or a Reserve Account
or delivered to the Master Servicer (if the Special Servicer is the Defaulting
Party) or that are thereafter received by or on behalf of it with respect to any
Mortgage Loan or REO Property (provided, however, that the Master Servicer and
the Special Servicer each shall, if terminated pursuant to this Section 7.01(b),
continue to be entitled to receive all amounts accrued or owing to it under this
Agreement on or prior to the date of such termination, whether in respect of
Advances or otherwise, and it shall continue to be entitled to the benefits of
Section 6.03 notwithstanding any such termination). Any cost or expenses in
connection with any actions to be taken by the Master Servicer, the Special
Servicer or the Trustee pursuant to this paragraph shall be borne by the
Defaulting Party and if not paid by the Defaulting Party within 90 days after
the presentation of reasonable documentation of such costs and expenses, such
expense shall be reimbursed by the Trust Fund; provided, however, that the
Defaulting Party shall not thereby be relieved of its liability for such
expenses. If and to the extent that the Defaulting Party has not reimbursed such
costs and expenses, the Trustee shall have an affirmative obligation to take all
reasonable actions to collect such expenses on behalf of and at the expense of
the Trust Fund. For purposes of this Section 7.01 and of Section 7.03(b), the
Trustee shall not be deemed to have knowledge of an event which constitutes, or
which with the passage of time or notice, or both, would constitute an Event of
Default described in clauses (i)-(viii) of subsection (a) above unless a
Responsible Officer of the Trustee has actual knowledge thereof or unless notice
of
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any event which is in fact such an Event of Default is received by the Trustee
and such notice references the Certificates, the Trust Fund or this Agreement.
SECTION 7.02. Trustee to Act; Appointment of Successor.
On and after the time the Master Servicer or the Special Servicer
resigns pursuant to Section 6.04 or receives a notice of termination pursuant to
Section 7.01, the Trustee shall be the successor in all respects to the Master
Servicer or the Special Servicer, as the case may be, in its capacity as such
under this Agreement and the transactions set forth or provided for herein and
shall have all (and the former Master Servicer or the Special Servicer, as the
case may be, shall cease to have any) of the responsibilities, duties and
liabilities (except as provided in the next sentence) of the Master Servicer or
the Special Servicer, as the case may be, arising thereafter, including, without
limitation, if the Master Servicer is the resigning or terminated party, the
Master Servicer's obligation to make P&I Advances, including, without
limitation, in connection with any termination of the Master Servicer for an
Event of Default described in clause 7.01(a)(xi), the unmade P&I Advances that
gave rise to such Event of Default; provided, that if the Master Servicer is the
resigning or terminated party, and if after the Closing Date the Trustee is
prohibited by law or regulation from obligating itself to make P&I Advances (as
evidenced by an Opinion of Counsel delivered to the Depositor and the Rating
Agencies) the Trustee shall not be obligated to make such P&I Advances and
provided, further, that any failure to perform such duties or responsibilities
caused by the Master Servicer's or the Special Servicer's, as the case may be,
failure to provide information or monies required by Section 7.01 shall not be
considered a default by the Trustee hereunder. Notwithstanding anything contrary
in this Agreement, the Trustee shall in no event be held responsible or liable
with respect to any of the representations and warranties of the resigning or
terminated party (other than the Trustee) or for any losses incurred by such
resigning or terminated party pursuant to Section 3.06 hereunder nor shall the
Trustee be required to purchase any Mortgage Loan hereunder. As compensation
therefor, the Trustee shall be entitled to all fees and other compensation which
the resigning or terminated party would have been entitled to if the resigning
or terminated party had continued to act hereunder. Notwithstanding the above,
the Trustee may, if it shall be unwilling in its sole discretion to so act as
either Master Servicer or Special Servicer, as the case may be, or shall, if it
is unable to so act as either Master Servicer or Special Servicer, as the case
may be, if the Trustee is not approved as a Master Servicer or a Special
Servicer, as the case may be, by any of the Rating Agencies or if the Holders of
Certificates entitled to at least 51% of the Voting Rights so request in writing
to the Trustee, promptly appoint, subject to the approval of each of the Rating
Agencies (as evidenced by written confirmation therefrom to the effect that the
appointment of such institution would not cause the qualification, downgrading
or withdrawal of the then current rating on any Class of Certificates) or
petition a court of competent jurisdiction to appoint, any established mortgage
loan servicing institution that meets the requirements of Section 6.02;
provided, however, that in the case of a resigning or terminated Special
Servicer, such appointment shall be subject to the rights of the Holders of
Certificates evidencing a majority of the Voting Rights allocated to the
Controlling Class to designate a successor pursuant to Section 6.09. Except with
respect to an appointment provided below, no
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appointment of a successor to the Master Servicer or the Special Servicer
hereunder shall be effective until the assumption of the successor to such party
of all its responsibilities, duties and liabilities under this Agreement.
Pending appointment of a successor to the Master Servicer or the Special
Servicer hereunder, the Trustee shall act in such capacity as hereinabove
provided. Notwithstanding the above, the Trustee shall, if the Master Servicer
is the resigning or terminated party, and the Trustee is prohibited by law or
regulation from making P&I Advances, promptly appoint any established mortgage
loan servicing institution that has a net worth of not less than $15,000,000 and
is otherwise acceptable to each Rating Agency (as evidenced by written
confirmation therefrom to the effect that the appointment of such institution
would not cause the qualification, downgrading or withdrawal of the then current
rating on any Class of Certificates), as the successor to the Master Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Master Servicer hereunder (including, without limitation,
the obligation to make P&I Advances), which appointment will become effective
immediately. In connection with any such appointment and assumption described
herein, the Trustee may make such arrangements for the compensation of such
successor out of payments on the Mortgage Loans as it and such successor shall
agree; provided, however, that no such compensation shall be in excess of that
permitted the resigning or terminated party hereunder. Such successor and the
other parties hereto shall take such action, consistent with this Agreement, as
shall be necessary to effectuate any such succession.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any resignation of the Master Servicer or the Special
Servicer pursuant to Section 6.04, any termination of the Master Servicer or the
Special Servicer pursuant to Section 7.01, any appointment of a successor to the
Master Servicer or the Special Servicer pursuant to Section 7.02 or the
effectiveness of any designation of a new Special Servicer pursuant to Section
6.09, the Trustee shall give prompt written notice thereof to Certificateholders
at their respective addresses appearing in the Certificate Register.
(b) Not later than the later of (i) 60 days after the occurrence of
any event which constitutes or, with notice or lapse of time or both, would
constitute an Event of Default and (ii) five days after a Responsible Officer of
the Trustee has notice of the occurrence of such an event, the Trustee shall
transmit by mail to the Depositor and all Certificateholders and the Rating
Agencies notice of such occurrence, unless such default shall have been cured.
SECTION 7.04. Waiver of Events of Default.
The Holders representing at least 66-2/3% of the Voting Rights
allocated to the Classes of Certificates affected by any Event of Default
hereunder may waive such Event of Default; provided, however, that an Event of
Default under clauses (i), (ii) , (ix) or (x) of Section 7.01(a) may be waived
only by all of the Certificateholders of the affected Classes. Upon any such
waiver of an Event of Default, such Event of Default shall cease to exist and
shall be deemed to have been remedied for every purpose hereunder. No such
waiver shall
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extend to any subsequent or other Event of Default or impair any right
consequent thereon except to the extent expressly so waived. Notwithstanding any
other provisions of this Agreement, for purposes of waiving any Event of Default
pursuant to this Section 7.04, Certificates registered in the name of the
Depositor or any Affiliate of the Depositor shall be entitled to Voting Rights
with respect to the matters described above.
SECTION 7.05. Additional Remedies of Trustee Upon Event of Default.
During the continuance of any Event of Default, so long as such
Event of Default shall not have been remedied, the Trustee, in addition to the
rights specified in Section 7.01, shall have the right, in its own name and as
trustee of an express trust, to take all actions now or hereafter existing at
law, in equity or by statute to enforce its rights and remedies and to protect
the interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filings of proofs of claim and debt in connection
therewith). Except with respect to an Event of Default resulting from a breach
of the covenant in Section 3.22(d), for which the sole remedy shall be
termination of the Master Servicer or as otherwise expressly provided in this
Agreement, no remedy provided for by this Agreement shall be exclusive of any
other remedy, and each and every remedy shall be cumulative and in addition to
any other remedy, and no delay or omission to exercise any right or remedy shall
impair any such right or remedy or shall be deemed to be a waiver of any Event
of Default. Under no circumstances shall the rights provided to the Trustee
under this Section 7.05 be construed as a duty or obligation of the Trustee.
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ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of an Event of Default and
after the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Default occurs and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs. Any permissive right of the Trustee contained in this Agreement
shall not be construed as a duty.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement (other than the Mortgage Files, the review of which
is specifically governed by the terms of Article II), shall examine them to
determine whether they conform to the requirements of this Agreement to the
extent specifically set forth herein. If any such instrument is found not to
conform to the requirements of this Agreement in a material manner, the Trustee
shall take such action as it deems appropriate to have the instrument corrected.
The Trustee shall not be responsible for the accuracy or content of any
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Depositor or the Master Servicer or the Special
Servicer, and accepted by the Trustee in good faith, pursuant to this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after
the curing of all such Events of Default which may have occurred,
the duties and obligations of the Trustee shall be determined solely
by the express provisions of this Agreement, the Trustee shall not
be liable except for the performance of such duties and obligations
as are specifically set forth in this Agreement, no implied
covenants or obligations shall be read into this Agreement against
the Trustee and, in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of
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the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Agreement;
(ii) The Trustee shall not be personally liable for an error
of judgment made in good faith by a Responsible Officer or
Responsible Officers of the Trustee, unless it shall be proved that
the Trustee was negligent in ascertaining the pertinent facts if it
was required to do so;
(iii) The Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of Holders of Certificates
entitled to at least 25% of the Voting Rights relating to the time,
method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Agreement; and
(iv) The protections, immunities and indemnities afforded to
the Trustee hereunder shall also be available to it in its capacity
as Paying Agent, Authenticating Agent, Certificate Registrar, REMIC
Administrator and Custodian.
SECTION 8.02. Certain Matters Affecting Trustee.
Except as otherwise provided in Section 8.01 and Article X.
(i) the Trustee may rely upon and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate, certificate
of auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document
reasonably believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(ii) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance therewith;
(iii) the Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Agreement or to make any investigation
of matters arising hereunder or, except as provided in Section 10.01 or 10.02,
to institute, conduct or defend any litigation hereunder or in relation hereto
at the request, order or direction of any of the Certificateholders, pursuant to
the provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or thereby; the Trustee
shall not be required to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against
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such risk or liability is not reasonably assured to it; provided, however, that
nothing contained herein shall, relieve the Trustee of the obligation, upon the
occurrence of an Event of Default which has not been cured, to exercise such of
the rights and powers vested in it by this Agreement, and to use the same degree
of care and skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs;
(iv) the Trustee shall not be personally liable for any action
reasonably taken, suffered or omitted by it in good faith and believed by it to
be authorized or within the discretion or rights or powers conferred upon it by
this Agreement;
(v) prior to the occurrence of an Event of Default hereunder and
after the curing of all Events of Default which may have occurred, the Trustee
shall not be bound to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless
requested in writing to do so by Holders of Certificates entitled to at least
25% of the Voting Rights; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation is, in the opinion of the
Trustee, not reasonably assured to the Trustee by the security afforded to it by
the terms of this Agreement, the Trustee may require reasonable indemnity
against such expense or liability as a condition to taking any such action;
(vi) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys; provided, however, that the Trustee shall remain responsible for all
acts and omissions of such agents or attorneys within the scope of their
employment to the same extent as it is responsible for its own actions and
omissions hereunder;
(vii) the Trustee shall not be responsible for any act or omission
of the Master Servicer or the Special Servicer (unless the Trustee is acting as
Master Servicer or the Special Servicer) or the Depositor; and
(viii) Neither the Trustee nor the Certificate Registrar shall have
any obligation or duty to monitor, determine or inquire as to compliance with
any restriction on transfer imposed under Article V under this Agreement or
under applicable law with respect to any transfer of any Certificate or any
interest therein, other than to require delivery of the certification(s) and/or
Opinions of Counsel described in said Article applicable with respect to changes
in registration of record ownership of Certificates in the Certificate Register
and to examine the same to determine substantial compliance with the express
requirements of this Agreement. The Trustee and Certificate Registrar shall have
no liability for transfers, including transfers made through the book-entry
facilities of the Depository or between or among Depository Participants or
beneficial owners of the Certificates, made in violation of applicable
restrictions except for its failure to perform its express duties in connection
with changes in registration of record ownership in the Certificate Register.
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SECTION 8.03. Trustee Not Liable for Validity or Sufficiency
of Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates, other than
the statements attributed to the Trustee in Article II and Section 8.16 and the
signature of the Certificate Registrar and the Authenticating Agent set forth on
each outstanding Certificate, shall be taken as the statements of the Depositor
or the Master Servicer or the Special Servicer, as the case may be, and the
Trustee assumes no responsibility for their correctness. Except as set forth in
Section 8.16, the Trustee makes no representations as to the validity or
sufficiency of this Agreement or of any Certificate (other than as to the
signature of the Trustee set forth thereon) or of any Mortgage Loan or related
document. The Trustee shall not be accountable for the use or application by the
Depositor of any of the Certificates issued to it or of the proceeds of such
Certificates, or for the use or application of any funds paid to the Depositor
in respect of the assignment of the Mortgage Loans to the Trust Fund, or any
funds deposited in or withdrawn from the Certificate Account or any other
account by or on behalf of the Depositor, the Master Servicer or the Special
Servicer. The Trustee shall not be responsible for the accuracy or content of
any resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by the Depositor, the Master Servicer or the Special
Servicer, and accepted by the Trustee in good faith, pursuant to this Agreement.
SECTION 8.04. Trustee May Own Certificates.
The Trustee or any agent of the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Certificates with the same
rights (except as otherwise provided in the definition of "Certificateholder")
it would have if it were not the Trustee or such agent.
SECTION 8.05. Fees and Expenses of Trustee; Indemnification of
Trustee.
(a) On each Distribution Date, the Trustee shall withdraw from the
general funds on deposit in the Distribution Account, prior to any distributions
to be made therefrom on such date, and pay to itself all earned but unpaid
Trustee Fees, as compensation for all services rendered by the Trustee in the
execution of the trusts hereby created and in the exercise and performance of
any of the powers and duties of the Trustee hereunder. The Trustee Fee (which
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) shall constitute the Trustee's sole compensation
for such services to be rendered by it.
(b) The Trustee and any director, officer, employee, affiliate,
agent or "control" person within the meaning of the Securities Act of 1933 of
the Trustee shall be entitled to be indemnified for and held harmless by the
Trust Fund against any loss, liability or reasonable "out-of-pocket" expense
(including, without limitation, costs and expenses of litigation, and of
investigation, counsel fees, damages, judgments and amounts paid in settlement)
arising out of, or incurred in connection with this Agreement, the Mortgage
Loans
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or the Certificates or any act of the Master Servicer or the Special Servicer
taken on behalf of the Trustee as provided for herein ("Trustee Liability");
provided, that neither the Trustee nor any of the other above specified Persons
shall be entitled to indemnification pursuant to this Section 8.05(b) for (1)
any liability specifically required to be borne thereby pursuant to the terms
hereof, or (2) any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of the Trustee's
obligations and duties hereunder, or by reason of its reckless disregard of such
obligations and duties, or as may arise from a breach of any representation,
warranty or covenant of the Trustee made herein. The provisions of this Section
8.05(b) and of Section 8.05(c) shall survive any resignation or removal of the
Trustee and appointment of a successor trustee.
(c) If the Trustee Liability arises from the issuance or sale of the
Certificates and the indemnification provided for in Section 8.05(b) is invalid
or unenforceable, then the Trust Fund shall contribute to the amount paid or
payable by the Trustee as a result of such Trustee Liability in such proportion
as is appropriate to reflect the relative fault of any other parties on the one
hand and the Trustee on the other in connection with the actions or omissions
which resulted in such Trustee Liability, as well as any other relevant
equitable considerations.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be an association or a
corporation organized and doing business under the laws of the United States of
America or any State thereof or the District of Columbia, authorized under such
laws to exercise trust powers, having a combined capital and surplus of at least
$100,000,000 and subject to supervision or examination by federal or state
banking authority. If such association or corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such association or corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. The Trustee shall also be an entity
with a credit rating of at least "AA" by each Rating Agency other than Moody's
and "Aa3" by Moody's or such other rating that shall not result in the
qualification, downgrading or withdrawal of the rating or ratings assigned to
one or more Classes of the Certificates by any Rating Agency. In case at any
time the Trustee shall cease to be eligible in accordance with the provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in Section 8.07; provided, that if the Trustee shall cease to
be so eligible because its combined capital and surplus is no longer at least
$100,000,000 or its long-term unsecured debt rating no longer conforms to the
requirements of the immediately preceding sentence, and if the Trustee proposes
to the other parties hereto to enter into an agreement with (and reasonably
acceptable to) each of them, and if in light of such agreement the Trustee's
continuing to act in such capacity would not (as evidenced in writing by each
Rating Agency) cause any Rating Agency to qualify, downgrade or withdraw any
rating assigned thereby to any Class of Certificates, then upon the execution
and delivery of such agreement the Trustee shall not be required to resign, and
may continue in such capacity, for
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so long as none of the ratings assigned by the Rating Agencies to the
Certificates is adversely affected thereby. The corporation or association
serving as Trustee may have normal banking and trust relationships with the
Depositor, the Master Servicer, the Special Servicer and their respective
Affiliates.
SECTION 8.07. Resignation and Removal of Trustee.
(a) The Trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice thereof to the Depositor, the
Master Servicer, the Special Servicer and to all Certificateholders at their
respective addresses set forth in the Certificate Register. Upon receiving such
notice of resignation, the Master Servicer shall promptly appoint a successor
trustee acceptable to the Depositor by written instrument, in duplicate, which
instrument shall be delivered to the resigning Trustee and to the successor
trustee. A copy of such instrument shall be delivered to the Depositor, the
Special Servicer and the Certificateholders by the Master Servicer. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 and shall fail to resign after
written request therefor by the Depositor or the Master Servicer, or if at any
time the Trustee shall become incapable of acting, or shall be adjudged bankrupt
or insolvent, or a receiver of the Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation, or if the Trustee or Paying Agent (if different than the Trustee)
shall fail (other than by reason of the failure of either the Master Servicer or
the Special Servicer to timely perform its obligations hereunder or as a result
of other circumstances beyond the Trustee's reasonable control), to timely
deliver any report to be delivered by the Trustee pursuant to Section 4.02 and
such failure shall continue unremedied for a period of five days, or if the
Trustee or Paying Agent (if different from the Trustee) fails to make
distributions required pursuant to Section 3.05(b), 4.01 or 9.01, then the
Depositor may remove the Trustee and appoint a successor trustee, if necessary,
acceptable to the Master Servicer by written instrument, in duplicate, which
instrument shall be delivered to the Trustee so removed and to the successor
trustee. A copy of such instrument shall be delivered to the Master Servicer,
the Special Servicer and the Certificateholders by the Depositor.
(c) The Holders of Certificates entitled to at least 51% of the
Voting Rights may at any time remove the Trustee and appoint a successor
trustee, if necessary, by written instrument or instruments, in triplicate,
signed by such Holders or their attorneys-in-fact duly authorized, one complete
set of which instruments shall be delivered to the Master Servicer, one complete
set to the Trustee so removed and one complete set to the successor trustee so
appointed. A copy of such instrument shall be delivered to the Depositor, the
Special Servicer and the remaining Certificateholders by the successor so
appointed. In the event that the
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Trustee is terminated or removed pursuant to this Section 8.07, all of its
rights and obligations under this Agreement and in and to the Mortgage Loans
shall be terminated, other than any rights or obligations that accrued prior to
the date of such termination or removal (including the right to receive all
fees, expenses and other amounts (including, without limitation, P&I Advances
and accrued interest thereon) accrued or owing to it under this Agreement, with
respect to periods prior to the date of such termination or removal and no
termination without cause shall be effective until the payment of such amounts
to the Trustee).
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.
SECTION 8.08. Successor Trustee.
(a) Any successor trustee appointed as provided in Section 8.07
shall execute, acknowledge and deliver to the Depositor, the Master Servicer,
the Special Servicer and to its predecessor trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with the
like effect as if originally named as trustee herein. The predecessor trustee
shall deliver to the successor trustee all Mortgage Files and related documents
and statements held by it hereunder (other than any Mortgage Files at the time
held on its behalf by a third-party Custodian, which Custodian shall become the
agent of the successor trustee), and the Depositor, the Master Servicer, the
Special Servicer and the predecessor trustee shall execute and deliver such
instruments and do such other things as may reasonably be required to more fully
and certainly vest and confirm in the successor trustee all such rights, powers,
duties and obligations, and to enable the successor trustee to perform its
obligations hereunder.
(b) No successor trustee shall accept appointment as provided in
this Section 8.08, unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 8.06.
(c) Upon acceptance of appointment by a successor trustee as
provided in this Section 8.08, such successor trustee shall mail notice of the
succession of such trustee hereunder to the Depositor and the
Certificateholders.
SECTION 8.09. Merger or Consolidation of Trustee.
Any entity into which the Trustee may be merged or converted or with
which it may be consolidated or any entity resulting from any merger, conversion
or consolidation to which the Trustee shall be a party, or any entity succeeding
to the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided such entity shall be eligible under the provisions
of Section 8.06, without the execution or filing of any paper or
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any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions hereof, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing the same may at the time be located,
the Master Servicer and the Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity, such title
to the Trust Fund, or any part thereof, and, subject to the other provisions of
this Section 8.10, such powers, duties, obligations, rights and trusts as the
Master Servicer and the Trustee may consider necessary or desirable. If the
Master Servicer shall not have joined in such appointment within 15 days after
the receipt by it of a request to do so, or in case an Event of Default in
respect of the Master Servicer shall have occurred and be continuing, the
Trustee alone shall have the power to make such appointment. No co-trustee or
separate trustee hereunder shall be required to meet the terms of eligibility as
a successor trustee under Section 8.06 hereunder and no notice to Holders of
Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be
required under Section 8.08 hereof.
(b) In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to the Master Servicer or the Special Servicer hereunder), the
Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to the Trust Fund or any portion thereof in any such jurisdiction)
shall be exercised and performed by such separate trustee or co-trustee at the
direction of the Trustee.
(c) Any notice, request or other writing given to the Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article VIII. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee.
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(d) Any separate trustee or co-trustee may, at any time, constitute
the Trustee, its agent or attorney-in-fact, with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect of
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall cease to exist, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall vest
in and be exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
(e) The appointment of a co-trustee or separate trustee under this
Section 8.10 shall not relieve the Trustee of its duties and responsibilities
hereunder.
SECTION 8.11. Appointment of Custodians.
The Trustee may appoint at the Trustee's expense one or more
Custodians to hold all or a portion of the Mortgage Files as agent for the
Trustee. Each Custodian shall be a depository institution supervised and
regulated by a federal or state banking authority, shall have combined capital
and surplus of at least $10,000,000, shall be qualified to do business in the
jurisdiction in which it holds any Mortgage File and shall not be the Depositor,
any Mortgage Loan Seller or any Affiliate of the Depositor or any Mortgage Loan
Seller. Neither the Master Servicer nor the Special Servicer shall have any duty
to verify that any such Custodian is qualified to act as such in accordance with
the preceding sentence. Any such appointment of a third party Custodian and the
acceptance thereof shall be pursuant to a written, agreement, which written
agreement shall (i) be consistent with this Agreement in all material respects
and requires the Custodian to comply with this Agreement in all material
respects and requires the Custodian to comply with all of the applicable
conditions of this Agreement; (ii) provide that if the Trustee shall for any
reason no longer act in the capacity of Trustee hereunder (including, without
limitation, by reason of an Event of Default), the successor trustee or its
designee may thereupon assume all of the rights and, except to the extent they
arose prior to the date of assumption, obligations of the Custodian under such
agreement or alternatively, may terminate such agreement without cause and
without payment of any penalty or termination fee; and (iii) not permit the
Custodian any rights of indemnification that may be satisfied out of assets of
the Trust Fund. The appointment of one or more Custodians shall not relieve the
Trustee from any of its obligations hereunder, and the Trustee shall remain
responsible for all acts and omissions of any Custodian. The initial Custodian
shall be the Trustee. Notwithstanding anything herein to the contrary, if the
Trustee is no longer the Custodian, any provision or requirement herein
requiring notice or any information or documentation to be provided to the
Custodian shall be construed to require that such notice, information or
documents also be provided to the Trustee. Any Custodian hereunder (other than
the Trustee) shall at all times maintain a fidelity bond and errors and
omissions policy in amounts customary for custodians performing duties similar
to those set forth in this Agreement.
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SECTION 8.12. Appointment of Authenticating Agents.
(a) The Trustee may at the Trustee's expense appoint one or more
Authenticating Agents, which shall be authorized to act on behalf of the Trustee
in authenticating Certificates. The Trustee shall cause any such Authenticating
Agent to execute and deliver to the Trustee an instrument in which such
Authenticating Agent shall agree to act in such capacity, in accordance with the
obligations and responsibilities herein. Each Authenticating Agent must be
organized and doing business under the laws of the United States of America or
of any State, authorized under such laws to do a trust business, have a combined
capital and surplus of at least $15,000,000, and be subject to supervision or
examination by federal or state authorities. Each Authenticating Agent shall be
subject to the same obligations, standard of care, protection and indemnities as
would be imposed on, or would protect, the Trustee hereunder. The appointment of
an Authenticating Agent shall not relieve the Trustee from any of its
obligations hereunder, and the Trustee shall remain responsible for all acts and
omissions of the Authenticating Agent. In the absence of any other Person
appointed in accordance herewith acting as Authenticating Agent, the Trustee
hereby agrees to act in such capacity in accordance with the terms hereof.
Notwithstanding anything herein to the contrary, if the Trustee is no longer the
Authenticating Agent, any provision or requirement herein requiring notice or
any information or documentation to be provided to the Authenticating Agent
shall be construed to require that such notice, information or documentation
also be provided to the Trustee.
(b) Any Person into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion, or consolidation to which any Authenticating Agent shall be
a party, or any Person succeeding to the corporate agency business of any
Authenticating Agent, shall continue to be the Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at
least 30 days' advance written notice of resignation to the Trustee, the
Certificate Registrar, the Master Servicer, the Special Servicer and the
Depositor. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent, the Master Servicer, the Certificate Registrar and the
Depositor. Upon receiving a notice of resignation or upon such a termination, or
in case at any time any Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 8.12, the Trustee may appoint a
successor Authenticating Agent, in which case the Trustee shall given written
notice of such appointment to the Master Servicer, the Certificate Registrar and
the Depositor and shall mail notice of such appointment to all Holders of
Certificates; provided, however, that no successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 8.12. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally named as
Authenticating Agent. No Authenticating Agent shall have responsibility or
liability for any action taken by it as such at the direction of the Trustee.
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SECTION 8.13. Appointment of Paying Agent.
The Trustee may appoint a Paying Agent for the purpose of making
distributions to Certificateholders hereunder. The Trustee shall cause such
Paying Agent to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee that such Paying Agent will hold all
sums held by it for the payment to Certificateholders in an Eligible Account in
trust for the benefit of the Certificateholders entitled thereto until such sums
shall be paid to the Certificateholders. All funds remitted by the Trustee or
the Master Servicer to any such Paying Agent for the purpose of making
distributions shall be paid to Certificateholders on each Distribution Date and
any amounts not so paid shall be returned on such Distribution Date to the
Trustee or the Master Servicer, as applicable. If the Paying Agent is not the
Trustee or the Master Servicer, the Trustee or the Master Servicer shall remit
to the Paying Agent on the Business Day prior to each Distribution Date, by wire
transfer in immediately available funds, the funds to be distributed on such
Distribution Date. Any Paying Agent shall be either a bank or trust company or
otherwise authorized under law to exercise corporate trust powers and shall have
a rating of at least "A" (or its equivalent) by each of Standard & Poor's and
Moody's, or such lower rating as will not result in qualification, downgrading
or withdrawal of the ratings then assigned to the Certificates, as evidenced in
writing by the Rating Agencies. Any such appointment of a third party Paying
Agent and the acceptance thereof shall be pursuant to a written agreement, which
written agreement shall (i) be consistent with this Agreement in all material
respects and requires the Paying Agent to comply with this Agreement in all
material respects and requires the Paying Agent to comply with all of the
applicable conditions of this Agreement; (ii) provide that if the Trustee shall
for any reason no longer act in the capacity of Trustee hereunder (including,
without limitation, by reason of an Event of Default), the successor trustee or
its designee may thereupon assume all of the rights and, except to the extent
they arose prior to the date of assumption, obligations of the Paying Agent
under such agreement or alternatively, may terminate such agreement without
cause and without payment of any penalty or termination fee; and (iii) not
permit the Paying Agent any rights of indemnification that may be satisfied out
of assets of the Trust Fund. The appointment of any Paying Agent shall not
relieve the Trustee from any of its obligations hereunder, and the Trustee shall
remain responsible for all acts and omissions of any Paying Agent to the extent
such Paying Agent would have been responsible pursuant to the terms hereof. The
initial Paying Agent shall be the Trustee. Notwithstanding anything herein to
the contrary, if the Trustee is no longer the Authenticating Agent, any
provision or requirement herein requiring notice or any information to be
provided to the Authenticating Agent shall be construed to require that such
notice, information or documentation also be provided to the Trustee.
SECTION 8.14. Appointment of REMIC Administrators.
(a) The Trustee may appoint at the Trustee's expense, one or more
REMIC Administrators, which shall be authorized to act on behalf of the Trustee
in performing the functions set forth in Sections 3.17, 10.01 and 10.02 herein.
The Trustee shall cause any such REMIC Administrator to execute and deliver to
the Trustee an instrument in which such REMIC
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Administrator shall agree to act in such capacity, with the obligations and
responsibilities herein. The appointment of a REMIC Administrator shall not
relieve the Trustee from any of its obligations hereunder, and the Trustee shall
remain responsible for all acts and omissions of the REMIC Administrator. Each
REMIC Administrator must be acceptable to the Trustee and must be organized and
doing business under the laws of the United States of America or of any State
and be subject to supervision or examination by federal or state authorities. In
the absence of any other Person appointed in accordance herewith acting as REMIC
Administrator, the Trustee hereby agrees to act in such capacity in accordance
with the terms hereof.
(b) Any Person into which any REMIC Administrator may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion, or consolidation to which any REMIC Administrator shall be a
party, or any Person succeeding to the corporate agency business of any REMIC
Administrator, shall continue to be the REMIC Administrator without the
execution or filing of any paper or any further act on the part of the Trustee
or the REMIC Administrator.
(c) Any REMIC Administrator may at any time resign by giving at
least 30 days' advance written notice of resignation to the Trustee, the
Certificate Registrar, the Paying Agent, the Master Servicer, the Special
Servicer and the Depositor. The Trustee may at any time terminate the agency of
any REMIC Administrator by giving written notice of termination to such REMIC
Administrator, the Master Servicer, the Certificate Registrar and the Depositor.
Upon receiving a notice of resignation or upon such a termination, or in case at
any time any REMIC Administrator shall cease to be eligible in accordance with
the provisions of this Section 8.14, the Trustee may appoint a successor REMIC
Administrator, in which case the Trustee shall given written notice of such
appointment to the Master Servicer and the Depositor and shall mail notice of
such appointment to all Holders of Certificates; provided, however, that no
successor REMIC Administrator shall be appointed unless eligible under the
provisions of this Section 8.14. Any successor REMIC Administrator upon
acceptance of its appointment hereunder shall become vested with all the rights,
powers, duties and responsibilities of its predecessor hereunder, with like
effect as if originally named as REMIC Administrator. No REMIC Administrator
shall have responsibility or liability for any action taken by it as such at the
direction of the Trustee.
SECTION 8.15. Access to Certain Information.
The Trustee shall afford to the Master Servicer, the Special
Servicer and the Depositor, any Certificateholder and to the OTS, the FDIC and
any other banking or insurance regulatory authority that may exercise authority
over any Certificateholder, access to any documentation regarding the Mortgage
Loans within its control that may be required to be provided by this Agreement
or by applicable law. Such access shall be afforded without charge but only upon
reasonable prior written request and during normal business hours at the offices
of the Trustee designated by it.
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SECTION 8.16. Representations, Warranties and Covenants of Trustee.
(a) The Trustee hereby represents and warrants to the Master
Servicer, the Special Servicer and the Depositor and for the benefit of the
Certificateholders, as of the Closing Date, that:
(i) The Trustee is a national banking association duly
organized, validly existing and in good standing under the laws of the
United States.
(ii) The execution and delivery of this Agreement by the
Trustee, and the performance and compliance with the terms of this
Agreement by the Trustee, will not violate the Trustee's organizational
documents or constitute a default (or an event which, with notice or lapse
of time, or both, would constitute a default) under, or result in a
material breach of, any material agreement or other material instrument to
which it is a party or by which it is bound.
(iii) Except to the extent that the laws of certain
jurisdictions in which any part of the Trust Fund may be located require
that a co-trustee or separate trustee be appointed to act with respect to
such property as contemplated by Section 8.10, the Trustee has the full
power and authority to carry on its business as now being conducted and to
enter into and consummate all transactions contemplated by this Agreement,
has duly authorized the execution, delivery and performance of this
Agreement, and has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the other parties hereto, constitutes a valid, legal and
binding obligation of the Trustee, enforceable against the Trustee in
accordance with the terms hereof (including with respect to any advancing
obligations hereunder), subject to (A) applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement of
creditors' rights generally and the rights of creditors of banks, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
(v) The Trustee is not in violation of, and its execution and
delivery of this Agreement and its performance and compliance with the
terms of this Agreement will not constitute a violation of, any law, any
order or decree of any court or arbiter, or any order, regulation or
demand of any federal, state or local governmental or regulatory
authority, which violation, in the Trustee's good faith and reasonable
judgment, is likely to affect materially and adversely the ability of the
Trustee to perform its obligations under this Agreement.
(vi) No litigation is pending or, to the best of the Trustee's
knowledge, threatened against the Trustee that, if determined adversely to
the Trustee, would prohibit the Trustee from entering into this Agreement
or, in the Trustee's good
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faith and reasonable judgment, is likely to materially and adversely
affect the ability of the Trustee to perform its obligations under this
Agreement.
(vii) Any consent, approval, authorization or order of any
court or governmental agency or body required for the execution, delivery
and performance by the Trustee of or compliance by the Trustee with this
Agreement or the consummation of the transactions contemplated by this
Agreement has been obtained and is effective.
(b) The Trustee covenants that by August 31, 1999, any custom-made
software or hardware designed or purchased or licensed by the Trustee and used
by the Trustee in the course of the operation or management of, or the
compiling, reporting or generation of data required by this Agreement will not
contain any deficiency (x) in the ability of such software or hardware to
identify correctly or perform calculations or other processing with respect to
dates after August 31, 1999 or (y) that would cause such software or hardware to
be fit no longer for the purpose for which it was intended by reason of the
changing of the date from 1999 to 2000.
SECTION 8.17. Reports to the Securities and Exchange Commission;
Available Information.
The Trustee shall prepare for filing, and execute, on behalf of the
Trust Fund, and file with the Securities and Exchange Commission, any and all
reports, statements and information respecting the Trust Fund and/or the
Certificates required to be filed on behalf of the Trust Fund under the Exchange
Act. Upon such filing with the Securities and Exchange Commission, the Trustee
shall promptly deliver to the Depositor and the Master Servicer a copy of any
such executed report, statement or information. The Depositor shall promptly
file, and exercise its reasonable best efforts to obtain a favorable response
to, no-action requests to, or requests for other appropriate exemptive relief
from, the Securities and Exchange Commission regarding the usual and customary
exemption from certain reporting requirements granted to issuers of securities
similar to the Certificates. The Depositor agrees to indemnify and hold harmless
the Trustee with respect to any liability, cost or expenses, including
reasonable attorneys' fees, arising from the Trustee's execution of such
reports, statements and information that contain errors or omissions or is
otherwise misleading, provided, however, that if the indemnification provided
for herein is invalid or unenforceable, then the Depositor shall contribute to
the amount paid by the Trustee as a result of such liability in such amount as
is necessary to limit the Trustee's responsibility for any such payment to any
amount resulting from its own negligence or willful misconduct. The Trustee
shall have no responsibility to determine whether or not any filing may be
required and shall not have any responsibility to review or confirm in any way
the accuracy or the sufficiency of the contents of any such filing.
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ARTICLE IX
TERMINATION
SECTION 9.01. Termination Upon Repurchase or Liquidation of All
Mortgage Loans.
Subject to Section 9.02, the Trust Fund and the respective
obligations and responsibilities under this Agreement of the Depositor, the
Master Servicer, the Special Servicer and the Trustee (other than the
obligations of the Paying Agent on behalf of the Trustee to provide for and make
payments to Certificateholders as hereafter set forth) shall terminate upon
payment (or provision for payment) (i) to the Certificateholders of all amounts
held by or on behalf of the Trustee and required hereunder to be so paid on the
Distribution Date following the earlier to occur of (A) the purchase by the
Depositor, the Master Servicer, Lehman Brothers Inc., the Special Servicer or
the Majority Subordinate Certificateholder of all Mortgage Loans and each REO
Property remaining in REMIC I at a price equal to (1) the aggregate Purchase
Price of all the Mortgage Loans included in REMIC I, plus (2) the appraised
value of each REO Property, if any, included in REMIC I, such appraisal to be
conducted by an Independent Appraiser selected by the Master Servicer and
approved by the Trustee, minus (3) if the purchaser is the Master Servicer, the
aggregate amount of unreimbursed Advances made by the Master Servicer, together
with any interest accrued and payable to the Master Servicer in respect of
unreimbursed Advances in accordance with Sections 3.03(d) and 4.03(d) and any
unpaid Master Servicing Fees remaining outstanding (which items shall be deemed
to have been paid or reimbursed to the Master Servicer in connection with such
purchase), and (B) the final payment or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan or REO Property remaining in REMIC I,
and (ii) to the Trustee, the Master Servicer, the Special Servicer and the
officers, directors, employees and agents of each of them of all amounts which
may have become due and owing to any of them hereunder; provided, however, that
in no event shall the trust created hereby continue beyond the earlier of (i)
the expiration of 21 years from the death of the last survivor of the
descendants of Joseph P. Kennedy, the late ambassador of the United States to
the Court of St. James, living on the date hereof and (ii) the Legal Final
Distribution Date.
The Depositor, Lehman Brothers Inc., the Master Servicer, the
Special Servicer or the Majority Subordinate Certificateholder may at its option
elect to purchase all of the Mortgage Loans and each REO Property remaining in
REMIC I as contemplated by clause (i) of the preceding paragraph by giving
written notice to the other parties hereto no later than 60 days prior to the
anticipated date of purchase; provided, however, that (i) the aggregate Stated
Principal Balance of the Mortgage Pool at the time of such election is less than
1% of the aggregate Cut-off Date Balance of the Mortgage Pool set forth in the
Preliminary Statement, and (ii) the Master Servicer shall not have the right to
effect such a purchase if, within 30 days following the Master Servicer's
delivery of a notice of election pursuant to this paragraph, the Depositor, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder shall give notice of its election to purchase all of the
Mortgage Loans and each REO Property remaining in REMIC I and shall thereafter
effect such purchase in accordance with the terms hereof. The Master Servicer,
the Depositor, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder shall not have the right to effect such a purchase if, within
30 days following the Special Servicer's delivery of a notice of election
pursuant to this paragraph, the Special Servicer shall give notice of its
election to purchase all of the Mortgage Loans and
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each REO Property remaining in REMIC I and shall thereafter effect such purchase
in accordance with the terms hereof. If the Trust Fund is to be terminated in
connection with the Master Servicer's, the Special Servicer's, the Majority
Subordinate Certificateholder's, Lehman Brothers Inc.'s or the Depositor's
purchase of all of the Mortgage Loans and each REO Property remaining in REMIC
I, the Master Servicer, the Special Servicer, the Majority Subordinate
Certificateholder, Lehman Brothers Inc. or the Depositor, as applicable, shall
deliver to the Paying Agent for deposit in the Distribution Account not later
than the P&I Advance Date relating to the Distribution Date on which the final
distribution on the Certificates is to occur an amount in immediately available
funds equal to the above-described purchase price. In addition, the Master
Servicer shall transfer to the Distribution Account all amounts required to be
transferred thereto on such P&I Advance Date from the Certificate Account
pursuant to the first paragraph of Section 3.04(b), together with any other
amounts on deposit in the Certificate Account that would otherwise be held for
future distribution. Upon confirmation that such final deposit has been made,
the Trustee shall release or cause to be released to the Master Servicer, the
Special Servicer, the Majority Subordinate Certificateholder, Lehman Brothers
Inc. or the Depositor, as applicable, the Mortgage Files for the remaining
Mortgage Loans and shall execute all assignments, endorsements and other
instruments furnished to it by the Master Servicer, the Special Servicer, the
Majority Subordinate Certificateholder, Lehman Brothers Inc. or the Depositor,
as applicable, as shall be necessary to effectuate transfer of the Mortgage
Loans and REO Properties to the Depositor, the Master Servicer, the Special
Servicer, Lehman Brothers Inc. or the Majority Subordinate Certificateholder (or
their respective designees), as applicable. Any transfer of Mortgage Loans to
the Depositor pursuant to this paragraph shall be on a servicing-released basis.
Notice of any termination shall be given promptly by the Trustee by
letter to Certificateholders mailed (a) if such notice is given in connection
with the Depositor's, the Master Servicer's, the Special Servicer's, Lehman
Brothers Inc.'s or the Majority Subordinate Certificateholder's purchase of the
Mortgage Loans and each REO Property remaining in REMIC I, not earlier than the
15th day and not later than the 25th day of the month next preceding the month
of the final distribution on the Certificates or (b) otherwise during the month
of such final distribution on or before the Determination Date in such month, in
each case specifying (i) the Distribution Date upon which the Trust Fund will
terminate and final payment of the Certificates will be made, (ii) the amount of
any such final payment and (iii) that the Record Date otherwise applicable to
such Distribution Date is not applicable, payments being made only upon
presentation and surrender of the Certificates at the offices of the Certificate
Registrar or such other location therein designated. The Trustee shall give such
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notice to the Master Servicer, the Special Servicer and the Depositor at the
time such notice is given to Certificateholders.
Upon presentation and surrender of the Certificates by the
Certificateholders on the final Distribution Date, the Paying Agent shall
distribute to each Certificateholder so presenting and surrendering its
Certificates such Certificateholder's Percentage Interest of that portion of the
amounts then on deposit in the Distribution Account that are allocable to
payments on the Class of Certificates so presented and surrendered. Amounts on
deposit in the Distribution Account as of the final Distribution Date, exclusive
of any portion thereof that would be payable to any Person in accordance with
clauses (ii) through (vi) of Section 3.05(b), and further exclusive of any
portion thereof that represents Prepayment Premiums and Yield Maintenance
Charges, shall be allocated in the following order of priority, in each case to
the extent of remaining available funds:
(i) to distributions of interest to the Holders of the Senior
Certificates, in an amount equal to, and pro rata in accordance with, all
Distributable Certificate Interest in respect of each Class of Senior
Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(ii) to distributions of principal to the Holders of the Class A-1
and Class A-2 Certificates, in an amount equal to, and pro rata in
accordance with, the respective Class Principal Balances thereof
outstanding immediately prior to such Distribution Date;
(iii) to distributions to the Holders of the Class A-1 and Class A-2
Certificates, in an amount equal to, pro rata in accordance with, and in
reimbursement of, all Realized Losses and Additional Trust Fund Expenses,
if any, previously allocated to each such Class of Certificates and not
previously reimbursed;
(iv) to distributions of interest to the Holders of the Class B
Certificates in an amount equal to all Distributable Certificate Interest
in respect of the Class B Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(v) to distributions of principal to the Holders of the Class B
Certificates, in an amount equal to the Class Principal Balance of the
Class B Certificates outstanding immediately prior to such Distribution
Date;
(vi) to distributions to the Holders of the Class B Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
B Certificates and not previously reimbursed;
(vii) to distributions of interest to the Holders of the Class C
Certificates in an amount equal to all Distributable Certificate Interest
in respect of the Class C
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Certificates for such Distribution Date and, to the extent not previously
paid, for all prior Distribution Dates;
(viii) to distributions of principal to the Holders of the Class C
Certificates, in an amount equal to the Class Principal Balance of the
Class C Certificates outstanding immediately prior to such Distribution
Date;
(ix) to distributions to the Holders of the Class C Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
C Certificates and not previously reimbursed;
(x) to distributions of interest to the Holders of the Class D
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class D Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xi) to distributions of principal to the Holders of the Class D
Certificates, in an amount equal to the Class Principal Balance of the
Class D Certificates outstanding immediately prior to such Distribution
Date;
(xii) to distributions to the Holders of the Class D Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
D Certificates and not previously reimbursed;
(xiii) to distributions of interest to the Holders of the Class E
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class E Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xiv) to distributions of principal to the Holders of the Class E
Certificates, in an amount equal to the Class Principal Balance of the
Class E Certificates outstanding immediately prior to such Distribution
Date;
(xv) to distributions to the Holders of the Class E Certificates, in
an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
E Certificates and not previously reimbursed;
(xvi) to distributions of interest to the Holders of the Class F
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class F Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
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(xvii) to distributions of principal to the Holders of the Class F
Certificates, in an amount equal to the Class Principal Balance of the
Class F Certificates outstanding immediately prior to such Distribution
Date;
(xviii) to distributions to the Holders of the Class F Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses if any, previously allocated to the Class F
Certificates and not previously reimbursed;
(xix) to distributions of interest to the Holders of the Class G
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class G Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xx) to distributions of principal to the Holders of the Class G
Certificates, in an amount equal to the Class Principal Balance of the
Class G Certificates outstanding immediately prior to such Distribution
Date;
(xxi) to distributions to the Holders of the Class G Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
G Certificates and not previously reimbursed;
(xxii) to distributions of interest to the Holders of the Class H
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class H Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxiii) to distributions of principal to the Holders of the Class H
Certificates, in an amount equal to the Class Principal Balance of the
Class H Certificates outstanding immediately prior to such Distribution
Date;
(xxiv) to distributions to the Holders of the Class H Certificates
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
H Certificates and not previously reimbursed;
(xxv) to distributions of interest to the Holders of the Class J
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class J Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxvi) to distributions of principal to the Holders of the Class J
Certificates, in an amount equal to the Class Principal Balance of the
Class J Certificates outstanding immediately prior to such Distribution
Date;
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(xxvii) to distributions to the Holders of the Class J Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
J Certificates and not previously reimbursed;
(xxviii) to distributions of interest to the Holders of the Class K
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class K Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxix) to distributions of principal to the Holders of the Class K
Certificates, in an amount equal to the Class Principal Balance of the
Class K Certificates outstanding immediately prior to such Distribution
Date;
(xxx) to distributions to the Holders of the Class K Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
K Certificates and not previously reimbursed;
(xxxi) to distributions of interest to the Holders of the Class L
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class L Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxxii) to distributions of principal to the Holders of the Class L
Certificates, in an amount equal to the Class Principal Balance of the
Class L Certificates outstanding immediately prior to such Distribution
Date;
(xxxiii) to distributions to the Holders of the Class L
Certificates, in an amount equal to, and in reimbursement of, all Realized
Losses and Additional Trust Fund Expenses, if any, previously allocated to
the Class L Certificates and not previously reimbursed; and
(xxxiv) to distributions of interest to the Holders of the Class M
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class M Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxxv) to distributions of principal to the Holders of the Class M
Certificates, in an amount equal to the Class Principal Balance of the
Class M Certificates outstanding immediately prior to such Distribution
Date;
(xxxvi) to distributions to the Holders of the Class M Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund
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Expenses, if any, previously allocated to the Class M Certificates and not
previously reimbursed;
(xxxvii) to distributions of interest to the Holders of the Class N
Certificates, in an amount equal to all Distributable Certificate Interest
in respect of the Class N Certificates for such Distribution Date and, to
the extent not previously paid, for all prior Distribution Dates;
(xxxviii) to distributions of principal to the Holders of the Class
N Certificates, in an amount equal to the Class Principal Balance of the
Class N Certificates outstanding immediately prior to such Distribution
Date;
(xxxix) to distributions to the Holders of the Class N Certificates,
in an amount equal to, and in reimbursement of, all Realized Losses and
Additional Trust Fund Expenses, if any, previously allocated to the Class
N Certificates and not previously reimbursed; and
(xl) to distributions to the Holders of the Class R-I, R-II and
R-III Certificates, as applicable, in an amount equal to the balance, if
any, of the Available Distribution Amount for such Distribution Date
remaining after the distributions to be made on such Distribution Date
pursuant to clauses (i) through (xxxix) above.
Any Prepayment Premiums and Yield Maintenance Charges on deposit in
the Certificate Account as of the final Distribution Date shall be distributed
among the Holders of the Class A-1, Class A-2, Class B, Class C, Class D, Class
E and Class F Certificates in accordance with Section 4.01(b). Any funds not
distributed to any Holder or Holders of Certificates of such Class on such
Distribution Date because of the failure of such Holder or Holders to tender
their Certificates shall, on such date, be set aside and held uninvested in
trust and credited to the account or accounts of the appropriate non-tendering
Holder or Holders. If any Certificates as to which notice has been given
pursuant to this Section 9.01 shall not have been surrendered for cancellation
within six months after the time specified in such notice, the Paying Agent
shall mail a second notice to the remaining non-tendering Certificateholders to
surrender their Certificates for cancellation in order to receive the final
distribution with respect thereto. If within one year after the second notice
all such Certificates shall not have been surrendered for cancellation, the
Paying Agent, directly or through an agent, shall take such reasonable steps to
contact the remaining non-tendering Certificateholders concerning the surrender
of their Certificates as it shall deem appropriate, and shall deal with all such
unclaimed amounts in accordance with applicable law. The costs and expenses of
holding such funds in trust and of contacting such Certificateholders following
the first anniversary of the delivery of such second notice to the non-tendering
Certificateholders shall be paid out of such funds. No interest shall accrue or
be payable to any former Holder on any amount held in trust hereunder.
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All actual distributions on the respective Classes of REMIC III
Certificates on the final Distribution Date in accordance with foregoing
provisions of this Section 9.01 shall be deemed to first have been distributed
from REMIC I to REMIC II on the various REMIC I Regular Interests in accordance
with Section 4.01(i) and then from REMIC II to REMIC III on the various REMIC II
Regular Interests in accordance with Section 4.01(h).
SECTION 9.02. Additional Termination Requirements.
(a) If the Depositor, the Master Servicer, Lehman Brothers Inc., the
Special Servicer or the Majority Subordinate Certificate holders purchases all
of the Mortgage Loans and each REO Property remaining in REMIC I as provided in
Section 9.01, the Trust Fund (and, accordingly, REMIC I, REMIC II and REMIC III)
shall be terminated in accordance with the following additional requirements,
unless the Person affecting the purchase obtains at its own expense and delivers
to the Trustee and, in the case of the Depositor, to the Trustee and the Master
Servicer, an Opinion of Counsel, addressed to the Trustee and the Master
Servicer, to the effect that the failure of the Trust Fund to comply with the
requirements of this Section 9.02 will not result in the imposition of taxes on
"prohibited transactions" of REMIC I, REMIC II and REMIC III as defined in
Section 860F of the Code or cause REMIC I, REMIC II and REMIC III to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) the Trustee shall specify the first day in the 90-day
liquidation period in a statement attached to the final Tax Return
for each of REMIC I, REMIC II and REMIC III pursuant to Treasury
regulation Section 1.860F-1 and shall satisfy all requirements of a
qualified liquidation under Section 860F of the Code and any
regulations thereunder as set forth in an Opinion of Counsel
obtained at the expense of the Trust Fund;
(ii) during such 90-day liquidation period and at or prior to
the time of making of the final payment on the Certificates, the
Trustee shall sell all of the assets of REMIC I to the Master
Servicer, the Depositor, Lehman Brothers Inc., the Special Servicer
or the Majority Subordinate Certificate holders, as applicable, for
cash; and
(iii) at the time of the making of the final payment on the
Certificates, the Paying Agent shall distribute or credit, or cause
to be distributed or credited, to the Certificateholders in
accordance with Section 9.01 all cash on hand (other than cash
retained to meet claims), and each of REMIC I, REMIC II and REMIC
III shall terminate at that time.
(b) By their acceptance of Certificates, the Holders thereof hereby
agree to authorize the Trustee to specify the 90-day liquidation period for each
of REMIC I, REMIC II and REMIC III, which authorization shall be binding upon
all successor Certificateholders.
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ARTICLE X
ADDITIONAL TAX PROVISIONS
SECTION 10.01. REMIC Administration.
(a) The REMIC Administrator shall elect to treat each of REMIC I,
REMIC II and REMIC III as a REMIC under the Code and, if necessary, under
applicable state law. Such election will be made on Form 1066 or other
appropriate federal or state Tax Returns for the taxable year ending on the last
day of the calendar year in which the Certificates are issued.
(b) The REMIC I Regular Interests, the REMIC II Regular Interests
and the Regular Certificates (or, in the case of the IO Certificates, each of
its Components) are hereby designated as "regular interests" (within the meaning
of Section 860G(a)(1) of the Code) in REMIC I, REMIC II and REMIC III,
respectively. The Class R-I Certificates, the Class R-II Certificates and the
Class R-III Certificates are hereby designated as the single class of "residual
interests" (within the meaning of Section 860G(a)(2) of the Code) in REMIC I,
REMIC II and REMIC III, respectively. None of the Master Servicer, the Special
Servicer or the Trustee shall (to the extent within its control) permit the
creation of any other "interests" in REMIC I, REMIC II or REMIC III (within the
meaning of Treasury regulation Section 1.860D-1(b)(1)).
(c) The Closing Date is hereby designated as the "startup day" of
REMIC I, REMIC II and REMIC III within the meaning of Section 860G(a)(9) of the
Code.
(d) The related Plurality Residual Certificateholder as to the
applicable taxable year is hereby designated as the Tax Matters Person of each
of REMIC I, REMIC II and REMIC III, and shall act on behalf of the related REMIC
in relation to any tax matter or controversy and shall represent the related
REMIC in any administrative or judicial proceeding relating to an examination or
audit by any governmental taxing authority; provided that the REMIC
Administrator is hereby irrevocably appointed to act and shall act (in
consultation with the Tax Matters Person for each of REMIC I, REMIC II and REMIC
III) as agent and attorney-in-fact for the Tax Matters Person for each of REMIC
I, REMIC II and REMIC III in the performance of its duties as such.
(e) For purposes of Treasury regulation Section 1.860G-1(a)(4)(iii),
the Legal Final Distribution Date has been designated the "latest possible
maturity date" of each REMIC I Regular Interest, each REMIC II Regular Interest
and each Class of Regular Certificates (or, in the case of the Class IO
Certificates, each Component of such Class).
(f) Except as otherwise provided in Section 3.17(a) and subsections
(i) and (j) below, the REMIC Administrator shall pay out of its own funds any
and all routine tax
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administration expenses of the Trust Fund incurred with respect to each of REMIC
I, REMIC II and REMIC III (but not including any professional fees or expenses
related to audits or any administrative or judicial proceedings with respect to
the Trust Fund that involve the Internal Revenue Service or state tax
authorities which extraordinary expenses shall be payable or reimbursable to the
Trustee from the Trust Fund unless otherwise provided in Section 10.01(i) or
10.01(j)).
(g) Within 30 days after the Closing Date, the REMIC Administrator
shall prepare and file with the Internal Revenue Service Form 8811, "Information
Return for Real Estate Mortgage Investment Conduits (REMIC) and Issuers of
Collateralized Debt Obligations" for the Trust Fund. In addition, the REMIC
Administrator shall prepare, sign and file all of the other Tax Returns in
respect of REMIC I, REMIC II and REMIC III. The expenses of preparing and filing
such returns shall be borne by the REMIC Administrator without any right of
reimbursement therefor. The other parties hereto shall provide on a timely basis
to the REMIC Administrator or its designee such information with respect to each
of REMIC I, REMIC II and REMIC III as is in its possession and reasonably
requested by the REMIC Administrator to enable it to perform its obligations
under this Article. Without limiting the generality of the foregoing, the
Depositor, within ten days following the REMIC Administrator's request therefor,
shall provide in writing to the REMIC Administrator such information as is
reasonably requested by the REMIC Administrator for tax purposes, as to the
valuations and issue prices of the Certificates, and the REMIC Administrator's
duty to perform its reporting and other tax compliance obligations under this
Article X shall be subject to the condition that it receives from the Depositor
such information possessed by the Depositor that is necessary to permit the
Trustee to perform such obligations.
(h) The REMIC Administrator shall perform on behalf of each of REMIC
I, REMIC II and REMIC III all reporting and other tax compliance duties that are
the responsibility of each such REMIC under the Code, the REMIC Provisions or
other compliance guidance issued by the Internal Revenue Service or, with
respect to State and Local Taxes, any state or local taxing authority. Included
among such duties, the REMIC Administrator shall provide to: (i) any Transferor
of a Residual Certificate, such information as is necessary for the application
of any tax relating to the transfer of a Residual Certificate to any Person who
is not a Permitted Transferee; (ii) the Certificateholders, such information or
reports as are required by the Code or the REMIC Provisions, including, without
limitation, reports relating to interest, original issue discount and market
discount or premium (using the Prepayment Assumption as required hereunder); and
(iii) the Internal Revenue Service, the name, title, address and telephone
number of the Person who will serve as the representative of each of REMIC I,
REMIC II and REMIC III.
(i) The REMIC Administrator shall perform its duties hereunder so as
to maintain the status of each of REMIC I, REMIC II and REMIC III as a REMIC
under the REMIC Provisions (and the Trustee, the Master Servicer and the Special
Servicer shall assist the REMIC Administrator to the extent reasonably requested
by the REMIC Administrator and to the extent of information within the
Trustee's, the Master Servicer's or the Special
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Servicer's possession or control). None of the REMIC Administrator, Master
Servicer, the Special Servicer, or the Trustee shall knowingly take (or cause
any of REMIC I, REMIC II or REMIC III to take) any action or fail to take (or
fail to cause to be taken) any action that, under the REMIC Provisions, if taken
or not taken, as the case may be, could (i) endanger the status of any of REMIC
I, REMIC II or REMIC III as a REMIC, or (ii) except as provided in Section
3.17(a), result in the imposition of a tax upon any of REMIC I, REMIC II or
REMIC III (including, but not limited to, the tax on prohibited transactions as
defined in Section 860F(a)(2) of the Code, the tax on contributions to a REMIC
set forth in Section 860G(d) of the Code or the result in the imposition of a
tax on "net income from foreclosure property" as defined in Section 860G(c) of
the Code) (any such endangerment or imposition or, except as provided in Section
3.17(a), imposition of a tax, an "Adverse REMIC Event"), unless the REMIC
Administrator has obtained or received an Opinion of Counsel (at the expense of
the party requesting such action or at the expense of the Trust Fund if the
REMIC Administrator seeks to take such action or to refrain from acting for the
benefit of the Certificateholders) to the effect that the contemplated action
will not result in an Adverse REMIC Event. The REMIC Administrator shall not
take any action or fail to take any action (whether or not authorized hereunder)
as to which the Master Servicer or the Special Servicer has advised it in
writing that either the Master Servicer or the Special Servicer has received or
obtained an Opinion of Counsel to the effect that an Adverse REMIC Event could
occur with respect to such action. In addition, prior to taking any action with
respect to REMIC I, REMIC II or REMIC III, or causing any of REMIC I, REMIC II
or REMIC III to take any action, that is not expressly permitted under the terms
of this Agreement, the Master Servicer and the Special Servicer shall consult
with the REMIC Administrator or its designee, in writing, with respect to
whether such action could cause an Adverse REMIC Event to occur. Neither the
Master Servicer nor the Special Servicer shall take any such action or cause any
of REMIC I, REMIC II or REMIC III to take any such action as to which the REMIC
Administrator has advised it in writing that an Adverse REMIC Event could occur,
and neither the Master Servicer nor the Special Servicer shall have any
liability hereunder for any action taken by it in accordance with the written
instructions of the REMIC Administrator. The REMIC Administrator may consult
with counsel to make such written advice, and the cost of same shall be borne by
the party seeking to take the action not expressly permitted by this Agreement,
but in no event at the cost or expense of the Trust Fund or the Trustee. At all
times as may be required by the Code, the REMIC Administrator shall make
reasonable efforts to ensure that substantially all of the assets of REMIC I,
REMIC II and REMIC III will consist of "qualified mortgages" as defined in
Section 860G(a)(3) of the Code and "permitted investments" as defined in Section
860G(a)(5) of the Code.
(j) If any tax is imposed on any of REMIC I, REMIC II or REMIC III,
including, without limitation, "prohibited transactions" taxes as defined in
Section 860F(a)(2) of the Code, any tax on "net income from foreclosure
property" as defined in Section 860G(c) of the Code, any taxes on contributions
to REMIC I, REMIC II or REMIC III after the Startup Day pursuant to Section
860G(d) of the Code, and any other tax imposed by the Code or any applicable
provisions of State or Local Tax laws (other than any tax permitted to be
incurred
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by the Special Servicer pursuant to Section 3.17(a)), such tax, together with
all incidental costs and expenses (including, without limitation, penalties and
reasonable attorneys' fees), shall be charged to and paid by: (i) the REMIC
Administrator, if such tax arises out of or results from a breach by the REMIC
Administrator of any of its obligations under this Article X provided that no
liability shall be imposed upon the REMIC Administrator under this Clause if
another party has responsibility for payment of such tax under Clauses (iii) or
(v) of this Section; (ii) the Special Servicer, if such tax arises out of or
results from a breach by the Special Servicer of any of its obligations under
Article III or this Article X; (iii) the Master Servicer, if such tax arises out
of or results from a breach by the Master Servicer of any of its obligations
under Article III or this Article X; (iv) the Trustee, if such tax arises out of
or results from a breach by the Trustee of any of its obligations under Article
IV, Article VIII or this Article X; (v) the applicable Mortgage Loan Seller, if
such tax was imposed due to the fact that any of the Mortgage Loans did not, at
the time of their transfer to the REMIC I, constitute a "qualified mortgage" as
defined in Section 860G(a)(3) of the Code; or (vi) the Trust Fund excluding the
portion thereof constituting the Grantor Trust, in all other instances. Any tax
permitted to be incurred by the Special Servicer pursuant to Section 3.17(a)
shall be charged to and paid by the Trust Fund. Any such amounts payable by the
Trust Fund shall be paid by the Paying Agent upon the written direction of the
REMIC Administrator out of amounts on deposit in the Distribution Account in
reduction of the Available Distribution Amount pursuant to Section 3.05(b).
(k) The REMIC Administrator shall, for federal income tax purposes,
maintain books and records with respect to each of REMIC I, REMIC II and REMIC
III on a calendar year and on an accrual basis.
(1) Following the Startup Day, none of the Trustee, the Master
Servicer and the Special Servicer shall accept any contributions of assets to
REMIC I, REMIC II or REMIC III unless it shall have received an Opinion of
Counsel (at the expense of the party seeking to cause such contribution and in
no event at the expense of the Trust Fund or the Trustee) to the effect that the
inclusion of such assets in such REMIC will not cause: (i) such REMIC to fail to
qualify as a REMIC at any time that any Certificates are outstanding; or (ii)
the imposition of any tax on such REMIC under the REMIC Provisions or other
applicable provisions of federal, state and local law or ordinances.
(m) None of the Trustee, the Master Servicer and the Special
Servicer shall consent to or, to the extent it is within the control of such
Person, permit: (i) the sale or disposition of any of the Mortgage Loans (except
in connection with (A) the default or foreclosure of a Mortgage Loan, including,
but not limited to, the sale or other disposition of a Mortgaged Property
acquired by deed in lieu of foreclosure, (B) the bankruptcy of REMIC I, REMIC II
or REMIC III, (C) the termination of REMIC I, REMIC II and REMIC III pursuant to
Article IX of this Agreement, or (D) a purchase of Mortgage Loans pursuant to or
as contemplated by Article II or III of this Agreement); (ii) the sale or
disposition of any investments in the Certificate Account, the Distribution
Account or the REO Account for gain; or (iii) the acquisition of any assets for
REMIC I, REMIC II or REMIC III (other than a
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Mortgaged Property acquired through foreclosure, deed in lieu of foreclosure or
otherwise in respect of a defaulted Mortgage Loan and other than Permitted
Investments acquired in connection with the investment of funds in the
Certificate Account, the Distribution Account or the REO Account); in any event
unless it has received an Opinion of Counsel (at the expense of the party
seeking to cause such sale, disposition, or acquisition but in no event at the
expense of the Trust Fund or the Trustee) to the effect that such sale,
disposition, or acquisition will not cause: (x) REMIC I, REMIC II or REMIC III
to fail to qualify as a REMIC at any time that any Certificates are outstanding;
or (y) the imposition of any tax on REMIC I, REMIC II or REMIC III under the
REMIC Provisions or other applicable provisions of federal, state and local law
or ordinances.
(n) Except as permitted by Section 3.17(a), none of the Trustee, the
Master Servicer and the Special Servicer shall enter into any arrangement by
which REMIC I, REMIC II or REMIC III will receive a fee or other compensation
for services nor permit REMIC I, REMIC II or REMIC III to receive any income
from assets other than "qualified mortgages" as defined in Section 860G(a)(3) of
the Code or "permitted investments" as defined in Section 860G(a)(5) of the
Code.
SECTION 10.02. Grantor Trust Administration.
(a) The REMIC Administrator shall treat the Grantor Trust, for tax
return preparation purposes, as a grantor trust under the Code and, if
necessary, under applicable state law and will file appropriate federal or state
Tax Returns for each taxable year ending on or after the last day of the
calendar year in which the Certificates are issued.
(b) The REMIC Administrator shall pay out of its own funds any and
all routine tax administration expenses of the Trust Fund incurred with respect
to the Grantor Trust (but not including any professional fees or expenses
related to audits or any administrative or judicial proceedings with respect to
the Trust Fund that involve the Internal Revenue Service or state tax
authorities which extraordinary expenses shall be payable or reimbursable to the
REMIC Administrator from the Trust Fund unless otherwise provided in Section
10.02(e) or 10.02(f)).
(c) The REMIC Administrator shall prepare, sign and file when due
all of the Tax Returns in respect of the Grantor Trust. The expenses of
preparing and filing such returns shall be borne by the REMIC Administrator
without any right of reimbursement therefor. The other parties hereto shall
provide on a timely basis to the REMIC Administrator or its designee such
information with respect to the Grantor Trust as is in its possession and
reasonably requested by the REMIC Administrator to enable it to perform its
obligations under this Section 10.02. Without limiting the generality of the
foregoing, the Depositor, within ten days following the REMIC Administrator's
request therefor, shall provide in writing to the REMIC Administrator such
information as is reasonably requested by the REMIC Administrator for tax
purposes, and the REMIC Administrator's duty to perform its reporting and other
tax compliance obligations under this Section 10.02 shall be subject to the
condition that it receives from the Depositor such
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information possessed by the Depositor that is necessary to permit the REMIC
Administrator to perform such obligations.
(d) The REMIC Administrator shall perform on behalf of the Grantor
Trust all reporting and other tax compliance duties that are required in respect
thereof under the Code, the Grantor Trust Provisions or other compliance
guidance issued by the Internal Revenue Service or any state or local taxing
authority.
(e) The REMIC Administrator shall perform its duties hereunder so as
to maintain the status of the Grantor Trust as a grantor trust under the Grantor
Trust Provisions (and the Trustee, the Master Servicer and the Special Servicer
shall assist the REMIC Administrator to the extent reasonably requested by the
REMIC Administrator and to the extent of information within the Trustee's, the
Master Servicer's or the Special Servicer's possession or control). None of the
REMIC Administrator, Master Servicer, the Special Servicer or the Trustee shall
knowingly take (or cause the Grantor Trust to take) any action or fail to take
(or fail to cause to be taken) any action that, under the Grantor Trust
Provisions, if taken or not taken, as the case may be, could endanger the status
of the Grantor Trust as a grantor trust under the Grantor Trust Provisions (any
such endangerment of grantor trust status, an "Adverse Grantor Trust Event"),
unless the REMIC Administrator has obtained or received an Opinion of Counsel
(at the expense of the party requesting such action or at the expense of the
Trust Fund if the REMIC Administrator seeks to take such action or to refrain
from taking any action for the benefit of the Certificateholders) to the effect
that the contemplated action will not result in an Adverse Grantor Trust Event.
None of the other parties hereto shall take any action or fail to take any
action (whether or not authorized hereunder) as to which the REMIC Administrator
has advised it in writing that the REMIC Administrator has received or obtained
an Opinion of Counsel to the effect that an Adverse Grantor Trust Event could
result from such action or failure to act. In addition, prior to taking any
action with respect to the Grantor Trust, or causing the Trust Fund to take any
action, that is not expressly permitted under the terms of this Agreement, the
Master Servicer and the Special Servicer shall consult with the REMIC
Administrator or its designee, in writing, with respect to whether such action
could cause an Adverse Grantor Trust Event to occur. Neither the Master Servicer
nor the Special Servicer shall have any liability hereunder for any action taken
by it in accordance with the written instructions of the REMIC Administrator.
The REMIC Administrator may consult with counsel to make such written advice,
and the cost of same shall be borne by the party seeking to take the action not
expressly permitted by this Agreement, but in no event at the cost or expense of
the Trust Fund, the REMIC Administrator or the Trustee.
(f) If any tax is imposed on the Grantor Trust, such tax, together
with all incidental costs and expenses (including, without limitation, penalties
and reasonable attorneys' fees), shall be charged to and paid by: (i) the REMIC
Administrator, if such tax arises out of or results from a breach by the REMIC
Administrator of any of its obligations under this Section 10.02; (ii) the
Special Servicer, if such tax arises out of or results from a breach by the
Special Servicer of any of its obligations under Article III or this Section
10.02; (iii) the Master Servicer, if such tax arises out of or results from a
breach by the Master Servicer of any of its obligations under Article III or
this Section 10.02; (iv) the Trustee, if such tax arises out of or results from
a breach
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by the Trustee of any of its obligations under Article IV, Article VIII or this
Section 10.02; or (v) the portion of the Trust Fund constituting the Grantor
Trust in all other instances.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment.
(a) This Agreement may be amended from time to time by the mutual
agreement of the Depositor, the Master Servicer, the Special Servicer and the
Trustee, without the consent of any of the Certificateholders, (i) to cure any
ambiguity, (ii) to correct, modify or supplement any provision herein which may
be inconsistent with any other provision herein, (iii) to add any other
provisions with respect to matters or questions arising hereunder which shall
not be inconsistent with the provisions hereof, (iv) to relax or eliminate any
requirement hereunder imposed by the REMIC Provisions if the REMIC Provisions
are amended or clarified such that any such requirement may be relaxed or
eliminated, or (v) if such amendment, as evidenced by an Opinion of Counsel
delivered to the Master Servicer, the Special Servicer and the Trustee, is
reasonably necessary to comply with any requirements imposed by the Code or any
successor or amendatory statute or any temporary or final regulation, revenue
ruling, revenue procedure or other written official announcement or
interpretation relating to federal income tax laws or any such proposed action
which, if made effective, would apply retroactively to any of the REMICs created
hereunder at least from the effective date of such amendment, or would be
necessary to avoid the occurrence of a prohibited transaction or to reduce the
incidence of any tax that would arise from any actions taken with respect to the
operation of any such REMIC; provided that such action (except any amendment
described in clause (v) above) shall not, as evidenced by an Opinion of Counsel
obtained by or delivered to the Master Servicer, the Special Servicer and the
Trustee, adversely affect in any material respect the interests of any
Certificateholder; and provided further that the Master Servicer, the Special
Servicer and the Trustee shall have first obtained from each Rating Agency
written assurance that such amendment does not adversely affect in any material
respect the rating on any Class of Certificates.
(b) This Agreement may also be amended from time to time by the
agreement of the Depositor, the Master Servicer, the Special Servicer and the
Trustee with the consent of the Holders of Certificates entitled to at least 51%
of the Voting Rights allocated to the affected Classes for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in any
manner the amount of, or delay the timing of, payments received or advanced on
Mortgage Loans that are required to be distributed on any Certificate without
the consent of the Holder of such Certificate, (ii) as evidenced by an Opinion
of Counsel obtained by or delivered to the Master Servicer, the Special Servicer
and the Trustee, adversely affect in any
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material respect the interests of the Holders of any Class of Certificates in a
manner other than as described in (i) without the consent of the Holders of all
Certificates of such Class, (iii) modify the provisions of this Section 11.01
without the consent of the Holders of all Certificates then outstanding, (iv)
modify the provisions of Section 3.20 without the consent of the Holders of
Certificates entitled to all of the Voting Rights or (v) modify the specified
percentage of Voting Rights which are required to be held by Certificateholders
to consent or not to object to any particular action pursuant to any provision
of this Agreement without the consent of the Holders of all Certificates then
outstanding. Notwithstanding any other provision of this Agreement, for purposes
of the giving or withholding of consents pursuant to this Section 11.01,
Certificates registered in the name of the Depositor or any Affiliate of the
Depositor shall be entitled to the same Voting Rights with respect to matters
described above as they would if any other Person held such Certificates, so
long as neither the Depositor nor any of its Affiliates is performing servicing
duties with respect to any of the Mortgage Loans.
(c) Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless it shall
first have obtained or been furnished with an Opinion of Counsel (at the expense
of the party seeking such amendment) to the effect that (i) such amendment or
the exercise of any power granted to the Trustee, the Master Servicer or the
Special Servicer in accordance with such amendment will not result in the
imposition of a tax on any of REMIC I, REMIC II or REMIC III pursuant to the
REMIC Provisions or on the Grantor Trust or cause any of REMIC I, REMIC II or
REMIC III to fail to qualify as a REMIC or the Grantor Trust to fail to qualify
as a "grantor trust" at any time that any Certificates are outstanding and (ii)
such amendment complies with the provisions of this Section 11.01.
(d) Promptly after the execution of any such amendment, the Trustee
shall send a copy thereof to each Certificateholder.
(e) It shall not be necessary for the consent of Certificateholders
under this Section 11.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.
(f) Each of the Master Servicer, the Special Servicer and the
Trustee may but shall not be obligated to enter into any amendment pursuant to
this Section that affects its rights, duties and immunities under this Agreement
or otherwise.
(g) The cost of any Opinion of Counsel to be delivered pursuant to
Section 11.01(a), (b) or (c) shall be borne by the Person seeking the related
amendment, except that if the Master Servicer, the Special Servicer or the
Trustee requests any amendment of this Agreement that protects or is in
furtherance of the rights and interests of Certificateholders, the cost of any
Opinion of Counsel required in connection therewith pursuant to Section 11.01(a)
<PAGE>
186
or (c) shall be payable out of the Certificate Account or the Distribution
Account pursuant to Section 3.05.
SECTION 11.02. Recordation of Agreement; Counterparts.
(a) To the extent permitted by applicable law, this Agreement is
subject to recordation in all appropriate public offices for real property
records in all the counties or other comparable jurisdictions in which any or
all of the properties subject to the Mortgages are situated, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Master Servicer at the expense of the Trust Fund, but only upon
direction accompanied by an Opinion of Counsel (the cost of which may be paid
out of the Certificate Account pursuant to Section 3.05(a)) to the effect that
such recordation materially and beneficially affects the interests of the
Certificateholders; provided, however, that the Trustee shall have no obligation
or responsibility to determine whether any such recordation of this Agreement is
required.
(b) For the purpose of facilitating the recordation of this
Agreement as herein provided and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
constitute but one and the same instrument.
SECTION 11.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
(b) No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third party by reason of any action taken by the parties to
this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement or any Mortgage
Loan, unless, with respect to any suit, action or proceeding upon or under or
with respect to this Agreement, such Holder previously shall have given to the
Trustee a written notice of default hereunder, and of the continuance thereof,
as hereinbefore provided, and unless also (except in the case of a default by
the Trustee) the Holders of Certificates entitled to at least 25% of the Voting
Rights shall have made written
<PAGE>
187
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding. It is understood and intended,
and expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatsoever by virtue of any provision of this
Agreement to affect, disturb or prejudice the rights of the Holders of any other
of such Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder, which priority or preference is not otherwise provided
for herein, or to enforce any right under this Agreement, except in the manner
herein provided and for the equal, ratable and common benefit of all
Certificateholders. For the protection and enforcement of the provisions of this
Section, each and every Certificateholder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.
SECTION 11.04. Governing Law.
This Agreement and the Certificates shall be construed in accordance
with the internal laws of the State of New York applicable to agreements made
and to be performed in said State, and the obligations, rights and remedies of
the parties hereunder shall be determined in accordance with such laws.
SECTION 11.05. Notices.
Any communications provided for or permitted hereunder shall be in
writing and, unless otherwise expressly provided herein, shall be deemed to have
been duly given when delivered to: (i) in the case of the Depositor, First Union
Commercial Mortgage Securities, Inc., One First Union Center, Charlotte, North
Carolina 28228, Attention: Barry Reiner, facsimile number: 704-383-1356; (ii) in
the case of the Master Servicer, First Union National Bank, First Union Capital
Markets, Charlotte Plaza, 23 Floor, 201 South College Street, Charlotte, North
Carolina 28288-1075, Attention: First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series
1998-C2, facsimile number: 704-383-9356; (iii) in the case of the Special
Servicer, CRIIMI MAE Services Limited Partnership, 11200 Rockville Pike,
Rockville, Maryland 20852, Attention: Brian Hanson, fax number 301-468-3142,
with a copy (at the same address) to David Iannarone, Legal Department - First
Union-Lehman Brothers-Bank of America Commercial Mortgage Trust, Commercial
Mortgage Pass-Through Certificates, Series 1998-C2, facsimile number:
301-255-0620; (iv) in the case of the Trustee, Norwest Bank Minnesota, National
Association, Corporate Trust Department, 11000 Broken Land Parkway, Columbia,
Maryland 21044-3562, facsimile number 410-884-2360, Attention: Corporate Trust
Services (CMBS)--First Union-Lehman Brothers-Bank of America Commercial Mortgage
Trust, Commercial Mortgage Pass-Through Certificates, Series 1998-C2, facsimile
number 410-884-2363; (v) in the case of the Underwriters to each of First Union
Capital Markets Group, One First Union Center, DC6, Charlotte, North Carolina
28288-1075,
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Attention: Trish Hall, First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 1998-C2,
facsimile number: 704-374-6435 and Lehman Brothers Inc., Three World Financial
Center, New York, New York 10285, Attention: First Union-Lehman Brothers-Bank of
America Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 1998-C2, facsimile number: 212-526-3746; (vi) in the case
of the Rating Agencies, (A) Moody's Investors Service, Inc., 99 Church Street,
New York, New York, Attention: CMBS-Monitoring, facsimile number 212-553-1350;
and (B) Standard & Poor's Ratings Group, 25 Broadway, New York, New York 10004,
Attention: Real Estate Ratings Group, Surveillance Manager, facsimile number:
212-412-0597; or as to each such Person such other address as may hereafter be
furnished by such Person to the parties hereto in writing. Any communication
required or permitted to be delivered to a Certificateholder shall be deemed to
have been duly given when mailed first class, postage prepaid, to the address of
such Holder as shown in the Certificate Register.
SECTION 11.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
SECTION 11.07. Grant of a Security Interest.
The Depositor intends that the conveyance of the Depositor's right,
title and interest in and to the Mortgage Loans pursuant to this Agreement shall
constitute a sale and not a pledge of security for a loan. If such conveyance is
deemed to be a pledge of security for a loan, however, the Depositor intends
that the rights and obligations of the parties to such loan shall be established
pursuant to the terms of this Agreement. The Depositor also intends and agrees
that, in such event, the Depositor shall be deemed to have granted to the
Trustee (in such capacity) a first priority security interest in the Depositor's
entire right, title and interest in and to the assets constituting the Trust
Fund.
SECTION 11.08. Streit Act.
Any provisions required to be contained in this Agreement by Section
126 of Article 4-A of the New York Real Property Law are hereby incorporated
herein, and such provisions shall be in addition to those conferred or imposed
by this Agreement; provided, however, that to the extent that such Section 126
shall not have any effect, and if said Section 126 should at any time be
repealed or cease to apply to this Agreement or be construed by judicial
decision to be inapplicable, said Section 126 shall cease to have any further
effect upon the provisions of this Agreement. In case of a conflict between the
provisions of this Agreement and any mandatory provisions of Article 4-A of the
New York Real Property Law,
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189
such mandatory provisions of said Article 4-A shall prevail, provided that if
said Article 4-A shall not apply to this Agreement, should at any time be
repealed, or cease to apply to this Agreement or be construed by judicial
decision to be inapplicable, such mandatory provisions of such Article 4-A shall
cease to have any further effect upon the provisions of this Agreement.
SECTION 11.09. Successors and Assigns; Beneficiaries.
The provisions of this Agreement shall be binding upon and inure to
the benefit of the respective successors and assigns of the parties hereto, and
all such provisions shall inure to the benefit of the Certificateholders. Lehman
Brothers Inc. shall be a third party beneficiary to this Agreement with respect
to its rights to receive the reports, statements and other information to which
it is entitled hereunder, to preserve its rights under Sub-Servicing Agreements
as contemplated by Section 3.22(d) and to terminate the Trust Fund pursuant to
Section 9.01. Each of the Sub-Servicers that is a party to a Sub-Servicing
Agreement on the Closing Date shall be a third party beneficiary to obligations
of a successor Master Servicer under Section 3.22(d), provided that the sole
remedy for any claim by a Sub-Servicer as a third party beneficiary pursuant to
this Section 11.09 shall be against a successor Master Servicer solely in its
corporate capacity and no Sub-Servicer shall have any rights or claims against
the Trust Fund or any party hereto (other than a successor Master Servicer in
its corporate capacity as set forth in this Section 11.09) as a result of any
rights conferred on such Sub-Servicer as a third party beneficiary pursuant to
this Section 11.09. This Agreement may not be amended in any manner that would
adversely affect the rights of any third party beneficiary hereof without its
consent. No other person, including, without limitation, any Mortgagor, shall be
entitled to any benefit or equitable right, remedy or claim under this
Agreement.
SECTION 11.10. Article and Section Headings.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
SECTION 11.11. Notices to Rating Agencies.
(a) The Trustee shall promptly provide notice to each Rating Agency
with respect to each of the following of which it has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Event of Default that has not been
cured;
(iii) the resignation or termination of the Trustee, the
Master Servicer or the Special Servicer;
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190
(iv) the repurchase of Mortgage Loans by either of the
Mortgage Loan Sellers pursuant to either of the Mortgage Loan
Purchase Agreements;
(v) any change in the location of the Distribution Account;
(vi) the final payment to any Class of Certificateholders; and
(vii) any sale or disposition of any Mortgage Loan or REO
Property.
(b) The Master Servicer shall promptly provide notice to each Rating
Agency with respect to each of the following of which it has actual knowledge:
(i) the resignation or removal of the Trustee; and
(ii) any change in the location of the Certificate Account.
(c) The Special Servicer shall furnish each Rating Agency with
respect to a non-performing or defaulted Mortgage Loan such information as the
Rating Agency shall reasonably request and which the Special Servicer can
reasonably provide in accordance with applicable law.
(d) To the extent applicable, each of the Master Servicer and the
Special Servicer shall promptly furnish to each Rating Agency copies of the
following items:
(i) each of its annual statements as to compliance described
in Section 3.13;
(ii) each of its annual independent public accountants'
servicing reports described in Section 3.14;
(iii) any Officers' Certificate delivered to the Trustee
pursuant to Section 4.03(c) or 3.08; and
(iv) each of the reports described in Section 3.12(a) and the
statements and reports described in Sections 3.12(b), 3.12(c) and
3.12(d).
(e) The Trustee shall (i) make available to each Rating Agency, upon
reasonable notice, the items described in Section 3.15(a) and (ii) promptly
deliver to each Rating Agency a copy of any notices given pursuant to Section
7.03(a) or Section 7.03(b).
(f) The Trustee shall promptly deliver to each Rating Agency a copy
of each statement or report described in Section 4.02.
(g) Each of the Trustee, the Master Servicer and the Special
Servicer shall provide to each Rating Agency such other information with respect
to the Mortgage Loans and
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191
the Certificates, to the extent such party possesses such information, as such
Rating Agency shall reasonably request.
SECTION 11.12. Complete Agreement.
This Agreement embodies the complete agreement among the parties and
may not be varied or terminated except by a written agreement conforming to the
provisions of Section 11.01. All prior negotiations or representations of the
parties are merged into this Agreement and shall have no force or effect unless
expressly stated herein.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers thereunto duly authorized, in each
case as of the day and year first above written.
FIRST UNION COMMERCIAL MORTGAGE
SECURITIES, INC.
Depositor
By:
----------------------------------
Name: Craig Lieberman
Title: Vice President
FIRST UNION NATIONAL BANK
Master Servicer
By:
----------------------------------
Name: Timothy S. Ryan
Title: Vice President
CRIIMI MAE SERVICES LIMITED PARTNERSHIP
Special Servicer
By: CRIIMI MAE SERVICES, INC.
By:
----------------------------------
Name:
Title:
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION
Trustee
By:
----------------------------------
Name:
Title:
<PAGE>
EXHIBIT A
Forms of Certificates
<PAGE>
EXHIBIT A-1
Form of Class A-1 Certificate
<PAGE>
CLASS A-1 COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.280% per annum A-1 Certificates as of the Closing
Date: $760,000,000
Date of Pooling and Servicing Initial Certificate Principal
Agreement: as of May 1, 1998 Balance of this Class A-1 Certificate
as of the Closing Date: $200,000,000
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AA 4
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G,
CLASS H, CLASS J, CLASS K, CLASS L, CLASS M AND CLASS N CERTIFICATES OF THE SAME
SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE
AND THE CLASS A-2 CERTIFICATES MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class A-1 Certificate (obtained by
dividing the principal amount of this Class A-1 Certificate (its "Certificate
Principal Balance") as of
-2-
<PAGE>
the Closing Date by the aggregate principal amount of all the Class A-1
Certificates (their "Class Principal Balance") as of the Closing Date) in that
certain beneficial ownership interest evidenced by all the Class A-1
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among First Union
Commercial Mortgage Securities, Inc. (herein called the "Depositor", which term
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, herein called the "Master Servicer", which term includes any
successor entity under the Agreement), CRIIMI MAE Services Limited Partnership
in such capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement), and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class A-1 Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class A-1
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest)
-3-
<PAGE>
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class A-1 Certificates are issuable in fully registered form
only without coupons in minimum denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
Class A-1 Certificates are exchangeable for new Class A-1 Certificates in
authorized denominations evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class A-1 Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
-4-
<PAGE>
No service charge will be imposed for any registration of transfer
or exchange of Class A-1 Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class A-1
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class
A-1 Certificates; however, such right to purchase is subject to the aggregate
Stated Principal Balance of the Mortgage Pool at the time of purchase being less
than 1% of the aggregate Stated Principal Balance of the Mortgage Loans as of
the Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
-5-
<PAGE>
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:
----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1 Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:
----------------------------------
Authorized Officer
-7-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________,
the Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-2
Form of Class A-2 Certificate
<PAGE>
CLASS A-2 COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.560% A-2 Certificates as of the Closing
Date: $1,693,794,000
Date of Pooling and Servicing Initial Certificate Principal
Agreement: as of May 1, 1998 Balance of this Class A-2
Certificate as of the Closing Date:
$200,000,000
Closing Date: May 28, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No. 337367 AB 2
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS B, CLASS C, CLASS D, CLASS E, CLASS F, CLASS G,
CLASS H, CLASS J, CLASS K, CLASS L, CLASS M AND CLASS N CERTIFICATES OF THE SAME
SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE, THE CLASS A-1 CERTIFICATES MAY BE REDUCED BY CERTAIN LOSSES AND
EXPENSES EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class A-2 Certificate (obtained by
dividing the principal amount of this Class A-2 Certificate (its "Certificate
Principal Balance") as of
-2-
<PAGE>
the Closing Date by the aggregate principal amount of all the Class A-2
Certificates (their "Class Principal Balance") as of the Closing Date) in that
certain beneficial ownership interest evidenced by all the Class A-2
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among First Union
Commercial Mortgage Securities, Inc. (herein called the "Depositor", which term
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, herein called the "Master Servicer", which term includes any
successor entity under the Agreement), CRIIMI MAE Services Limited Partnership
(in such capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class A-2 Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class A-2
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest)
-3-
<PAGE>
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class A-2 Certificates are issuable in fully registered form
only without coupons in minimum denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
Class A-2 Certificates are exchangeable for new Class A-2 Certificates in
authorized denominations evidencing the same aggregate Percentage Interest, as
requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class A-2 Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
-4-
<PAGE>
No service charge will be imposed for any registration of transfer
or exchange of Class A-2 Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class A-2
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, and the Certificate Registrar and any agent of the Depositor, the
Master Servicer, the Special Servicer, the Trustee, the Paying Agent or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes whatsoever and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent, the Certificate Registrar or any such agent shall be affected by notice
to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class
A-2 Certificates; however, such right to purchase is subject to the aggregate
Stated Principal Balance of the Mortgage Pool at the time of purchase being less
than 1% of the aggregate Stated Principal Balance of the Mortgage Loans as of
the Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the
-5-
<PAGE>
Trustee with the consent of the Holders of Certificates entitled to at least 51%
of the Voting Rights allocated to the affected Classes. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, including any
amendment necessary to maintain the status of the Trust Fund (or designated
portions thereof) as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-6-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:
--------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-2 Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:
--------------------------------
Authorized Officer
-7-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________,
the Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-4
Form of Class IO Certificate
<PAGE>
CLASS IO MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Date of Pooling and Servicing Aggregate Certificate Notional Amount
Agreement: as of May 1, 1998 of all Class IO Certificates as of
the Closing Date: $3,408,048,239
Closing Date: May 28, 1998 Certificate Notional Amount of this
Class IO Certificate as of the
Closing Date: $200,000,000
First Distribution Date: Aggregate Stated Principal Balance of
June 18, 1998 the Mortgage Loans as of the Closing
Date: $3,408,048,239
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AG 1
THIS CERTIFICATE IS NOT ENTITLED TO INTEREST ON THE CERTIFICATE NOTIONAL AMOUNT,
BUT IS ENTITLED TO RECEIVE INTEREST ON ITS COMPONENTS AS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT.
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE"). THE FOLLOWING INFORMATION IS PROVIDED SOLELY
FOR THE PURPOSES OF APPLYING THE U.S. FEDERAL INCOME TAX ORIGINAL ISSUE DISCOUNT
("OID") RULES TO THIS CERTIFICATE. THE ISSUE DATE OF THIS CERTIFICATE IS MAY 28,
1998. ASSUMING THAT THE MORTGAGE LOANS PREPAY AT AN ASSUMED RATE OF PREPAYMENT
USED SOLELY FOR THE PURPOSES OF APPLYING THE OID RULES TO THE CERTIFICATES EQUAL
TO A CPR (AS DEFINED IN THE PROSPECTUS DATED MAY 11, 1998 AND THE PROSPECTUS
SUPPLEMENT DATED MAY 21, 1998 RELATING TO THIS CERTIFICATE) OF 0% (THE
"PREPAYMENT ASSUMPTION"), EXCEPT THAT EACH ARD LOAN IS REPAID ON ITS ANTICIPATED
REPAYMENT DATE, THIS CERTIFICATE HAS BEEN ISSUED WITH NO MORE THAN $[ ]
OF OID PER $[ ] OF INITIAL CERTIFICATE NOTIONAL AMOUNT, THE YIELD TO
MATURITY IS [ ]% PER ANNUM, AND THE AMOUNT OF OID ATTRIBUTABLE TO THE
INITIAL ACCRUAL PERIOD IS NO MORE THAN $[ ] PER $1,000 OF INITIAL
CERTIFICATE NOTIONAL AMOUNT, COMPUTED UNDER THE EXACT METHOD. NO REPRESENTATION
IS MADE THAT THE MORTGAGE LOANS WILL PREPAY AT A RATE BASED ON THE PREPAYMENT
ASSUMPTION OR AT ANY OTHER RATE.
-2-
<PAGE>
THIS CERTIFICATE DOES NOT HAVE A CERTIFICATE PRINCIPAL BALANCE AND WILL NOT
ENTITLE THE HOLDER HEREOF TO DISTRIBUTIONS OF PRINCIPAL.
-3-
<PAGE>
This certifies that ___________ is the registered owner of the
Percentage Interest evidenced by this Class IO Certificate in that certain
beneficial ownership interest evidenced by all the Class IO Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among First Union Commercial Mortgage
Securities, Inc. (herein called the "Depositor", which term includes any
successor entity under the Agreement), First Union National Bank (in such
capacity, herein called the "Master Servicer", which term includes any successor
entity under the Agreement), CRIIMI MAE Services Limited Partnership (in such
capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class IO Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class IO
Certificates will be made by Norwest Bank Minnesota, National Association as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate will be made in like manner, but only upon
presentation and surrender of this Certificate at the offices of the Certificate
Registrar or such other location specified in the notice to Holder hereof of
such final distribution.
-4-
<PAGE>
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class IO Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class IO
Certificates are exchangeable for new Class IO Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class IO Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer
or exchange of Class IO Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class IO
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the
-5-
<PAGE>
Special Servicer, the Trustee, the Paying Agent, Certificate Registrar or any
such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class IO
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
-6-
<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class IO Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________
________________________________________________________________
________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-5
Form of Class B Certificate
<PAGE>
CLASS B COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.640% B Certificates as of the Closing
Date: $170,403,000
Date of Pooling and Servicing Initial Certificate Principal
Agreement: as of May 1, 1998 Balance of this Class B
Certificate as of the Closing Date:
$170,403,000
Closing Date: May 28, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No. 337367 AC 0
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES AND THE CLASS IO CERTIFICATES OF THE SAME SERIES TO THE EXTENT
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL
ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE
CONDITIONS OF SECTIONS I, III AND IV OF PTE
-2-
<PAGE>
95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER. AS A CONDITION TO
REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL
HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE, IF IT
IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE PRECEDING SENTENCE, TO
EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IF THIS CERTIFICATE IS
IN BOOK-ENTRY FORM, ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE
REPRESENTED TO THE TRUSTEE, THE DEPOSITOR AND THE TRANSFEROR TO THE EFFECT (X)
THAT IT IS NOT A PERSON DESCRIBED IN CLAUSE (A) OR CLAUSE (B) OR (Y) AS
DESCRIBED IN CLAUSE (i) AND CLAUSE (ii).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES
AND THE CLASS A-2 CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO,
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H,
CLASS J, CLASS K, CLASS L, CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES
IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class B Certificate (obtained by dividing
the principal amount of this Class B Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class B Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by
-3-
<PAGE>
all the Class B Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among First
Union Commercial Mortgage Securities, Inc. (herein called the "Depositor", which
term includes any successor entity under the Agreement), First Union National
Bank (in such capacity, herein called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, herein called the "Special Servicer", which term
includes any successor entity under the Agreement) and Norwest Bank Minnesota,
National Association (herein called the "Trustee", which term includes any
successor entity under the Agreement), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class B Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class B
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of
-4-
<PAGE>
such final distribution. Also notwithstanding the foregoing, any distribution
that may be made with respect to this Certificate in reimbursement of any
Realized Loss or Additional Trust Fund Expense previously allocated to this
Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class B Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class B
Certificates are exchangeable for new Class B Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class B Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer
or exchange of Class B Certificates, but the
-5-
<PAGE>
Certificate Registrar may require payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any transfer
or exchange of Class B Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class B
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected
-6-
<PAGE>
Classes. Any such consent by the Holder of this Certificate shall be conclusive
and binding on such Holder and upon all future Holders of this Certificate and
of any Certificate issued upon the transfer hereof or in exchange herefor or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, including any amendment necessary to maintain the status
of the Trust Fund (or designated portions thereof) as a REMIC, without the
consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:
---------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:
--------------------------------
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________,
the Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-6
Form of Class C Certificate
<PAGE>
CLASS C COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.730% C Certificates as of the Closing
Date: $170,402,000
Date of Pooling and Servicing Initial Certificate Principal
Agreement: as of May 1, 1998 Balance of this Class C
Certificate as of the Closing Date:
$170,402,000
Closing Date: May 28, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AD 8
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES AND THE CLASS B CERTIFICATES OF THE SAME
SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL
ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE
CONDITIONS OF SECTIONS I, III AND IV OF PTE
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<PAGE>
95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER. AS A CONDITION TO
REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL
HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE, IF IT
IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE PRECEDING SENTENCE, TO
EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IF THIS CERTIFICATE IS
IN BOOK-ENTRY FORM, ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE
REPRESENTED TO THE TRUSTEE, THE DEPOSITOR AND THE TRANSFEROR TO THE EFFECT (X)
THAT IT IS NOT A PERSON DESCRIBED IN CLAUSE (A) OR CLAUSE (B) OR (Y) AS
DESCRIBED IN CLAUSE (i) AND CLAUSE (ii).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, AND THE CLASS B CERTIFICATES OF THE SAME SERIES ARE
REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE
CERTIFICATE PRINCIPAL BALANCE OF THE CLASS D, CLASS E, CLASS F, CLASS G, CLASS
H, CLASS J, CLASS K, CLASS L, CLASS M AND CLASS N CERTIFICATES OF THE SAME
SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE
MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS
SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class C Certificate (obtained by dividing
the principal amount of this Class C Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class C Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by
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<PAGE>
all the Class C Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among First
Union Commercial Mortgage Securities, Inc. (herein called the "Depositor", which
term includes any successor entity under the Agreement), First Union National
Bank (in such capacity, herein called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, herein called the "Special Servicer", which term
includes any successor entity under the Agreement) and Norwest Bank Minnesota,
National Association (herein called the "Trustee", which term includes any
successor entity under the Agreement), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class C Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class C
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of
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<PAGE>
such final distribution. Also notwithstanding the foregoing, any distribution
that may be made with respect to this Certificate in reimbursement of any
Realized Loss or Additional Trust Fund Expense previously allocated to this
Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class C Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class C
Certificates are exchangeable for new Class C Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class C Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer
or exchange of Class C Certificates, but the
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<PAGE>
Certificate Registrar may require payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any transfer
or exchange of Class C Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class C
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected
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<PAGE>
Classes. Any such consent by the Holder of this Certificate shall be conclusive
and binding on such Holder and upon all future Holders of this Certificate and
of any Certificate issued upon the transfer hereof or in exchange herefor or in
lieu hereof whether or not notation of such consent is made upon this
Certificate. The Agreement also permits the amendment thereof, in certain
limited circumstances, including any amendment necessary to maintain the status
of the Trust Fund (or designated portions thereof) as a REMIC, without the
consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:
-----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class C Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:
----------------------------------
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________,
the Assignee named above, or ______________, as its agent.
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<PAGE>
EXHIBIT A-7
Form of Class D Certificate
<PAGE>
CLASS D COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.778% D Certificates as of the Closing
Date: $204,483,000
Date of Pooling and Servicing Initial Certificate Principal
Agreement: as of May 1, 1998 Balance of this Class D
Certificate as of the Closing Date:
$200,000,000
Closing Date: May 28, 1998 Aggregate Stated Principal
Balance of the Mortgage Loans
as of the Closing Date:
$3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota, National
Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AE 6
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<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES AND THE CLASS
C CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL
ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE
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<PAGE>
95-60"), AND (ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE
SATISFIED WITH RESPECT TO SUCH TRANSFER. AS A CONDITION TO REGISTRATION OF
TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO
REQUIRE ANY PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE, IF IT IS NOT A PLAN OR
PERSON DESCRIBED IN CLAUSE (B) OF THE PRECEDING SENTENCE, TO EXECUTE A
CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IF THIS CERTIFICATE IS IN
BOOK-ENTRY FORM, ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE
REPRESENTED TO THE TRUSTEE, THE DEPOSITOR AND THE TRANSFEROR TO THE EFFECT (X)
THAT IT IS NOT A PERSON DESCRIBED IN CLAUSE (A) OR CLAUSE (B) OR (Y) AS
DESCRIBED IN CLAUSE (i) AND CLAUSE (ii).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES AND THE CLASS C
CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION
OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS
SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN
ADDITION, IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS E, CLASS
F, CLASS G, CLASS H, CLASS J, CLASS K, CLASS L, CLASS M AND CLASS N CERTIFICATES
OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE
TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class D Certificate (obtained by dividing
the principal amount of this Class D Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class D Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class D
Certificates in the Trust Fund created pursuant
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<PAGE>
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among First Union Commercial Mortgage Securities, Inc. (herein
called the "Depositor", which term includes any successor entity under the
Agreement), First Union National Bank (in such capacity, herein called the
"Master Servicer", which term includes any successor entity under the
Agreement), CRIIMI MAE Services Limited Partnership (in such capacity, herein
called the "Special Servicer", which term includes any successor entity under
the Agreement) and Norwest Bank Minnesota, National Association (herein called
the "Trustee", which term includes any successor entity under the Agreement), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
respective meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class D Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class D
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of such final distribution. Also notwithstanding the foregoing,
any
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<PAGE>
distribution that may be made with respect to this Certificate in reimbursement
of any Realized Loss or Additional Trust Fund Expense previously allocated to
this Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class D Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class D
Certificates are exchangeable for new Class D Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class D Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No service charge will be imposed for any registration of transfer
or exchange of Class D Certificates, but the Certificate Registrar may require
payment of a sum sufficient to
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<PAGE>
cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Class D Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class D
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate
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<PAGE>
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, including any amendment necessary to maintain the
status of the Trust Fund (or designated portions thereof) as a REMIC, without
the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:
----------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class D Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:
----------------------------------
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________,
the Assignee named above, or ______________, as its agent.
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<PAGE>
EXHIBIT A-8
Form of Class E Certificate
<PAGE>
CLASS E COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.778% E Certificates as of the Closing
Date: $68,161,000
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class E Certificate as of the
Closing Date: $68,161,000
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AF 3
-1-
<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES AND THE CLASS D CERTIFICATES OF THE SAME SERIES TO THE EXTENT
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL
ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION
III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE
-2-
<PAGE>
95-60"), AND (ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE
SATISFIED WITH RESPECT TO SUCH TRANSFER. AS A CONDITION TO REGISTRATION OF
TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO
REQUIRE ANY PROSPECTIVE TRANSFEREE OF THIS CERTIFICATE, IF IT IS NOT A PLAN OR
PERSON DESCRIBED IN CLAUSE (B) OF THE PRECEDING SENTENCE, TO EXECUTE A
CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN THE FORM OF EXHIBIT H TO THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IF THIS CERTIFICATE IS IN
BOOK-ENTRY FORM, ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE
REPRESENTED TO THE TRUSTEE, THE DEPOSITOR AND THE TRANSFEROR TO THE EFFECT (X)
THAT IT IS NOT A PERSON DESCRIBED IN CLAUSE (A) OR CLAUSE (B) OR (Y) AS
DESCRIBED IN CLAUSE (i) AND CLAUSE (ii).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES
AND THE CLASS D CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO,
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE
PRINCIPAL BALANCE OF THE CLASS F, CLASS G, CLASS H, CLASS J, CLASS K, CLASS L,
CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN
LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING
CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ABOVE.
This certifies that Cede & Co. is the registered owner of the
Percentage Interest evidenced by this Class E Certificate (obtained by dividing
the principal amount of this Class E Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class E
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<PAGE>
Certificates (their "Class Principal Balance") as of the Closing Date) in that
certain beneficial ownership interest evidenced by all the Class E Certificates
in the Trust Fund created pursuant to a Pooling and Servicing Agreement, dated
as specified above (the "Agreement"), among First Union Commercial Mortgage
Securities, Inc. (herein called the "Depositor", which term includes any
successor entity under the Agreement), First Union National Bank (in such
capacity, herein called the "Master Servicer", which term includes any successor
entity under the Agreement), CRIIMI MAE Services Limited Partnership (in such
capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class E Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class E
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this
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<PAGE>
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class E Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class E
Certificates are exchangeable for new Class E Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class E Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
-5-
<PAGE>
No service charge will be imposed for any registration of transfer
or exchange of Class E Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class E
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class E
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the
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<PAGE>
Trustee with the consent of the Holders of Certificates entitled to at least 51%
of the Voting Rights allocated to the affected Classes. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, including any
amendment necessary to maintain the status of the Trust Fund (or designated
portions thereof) as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-7-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class E Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-9
Form of Class F Certificate
<PAGE>
CLASS F COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.778% F Certificates as of the Closing
Date: $51,121,000
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class F Certificate as of the
Closing Date: $51,121,000
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AH 9
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<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES AND THE CLASS E CERTIFICATES OF THE SAME
SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL
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<PAGE>
REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT, A "PLAN") OR (B) TO ANY PERSON WHO IS DIRECTLY OR
INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH INTEREST HEREIN ON BEHALF OF, AS
NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING, WITHOUT
LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR SEPARATE
ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT SUCH A
TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (i) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER.
AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE
REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF THIS
CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE
PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
IF THIS CERTIFICATE IS IN BOOK-ENTRY FORM, ANY TRANSFEREE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE REPRESENTED TO THE TRUSTEE, THE DEPOSITOR AND THE
TRANSFEROR TO THE EFFECT (X) THAT IT IS NOT A PERSON DESCRIBED IN CLAUSE (A) OR
CLAUSE (B) OR (Y) AS DESCRIBED IN CLAUSE (i) AND CLAUSE (ii).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES AND THE CLASS E CERTIFICATES OF THE SAME SERIES ARE
REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE
CERTIFICATE PRINCIPAL BALANCE OF THE CLASS G, CLASS H, CLASS J, CLASS K, CLASS
L, CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN
LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING
CERTIFICATE PRINCIPAL
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<PAGE>
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that _____________ is the registered owner of the
Percentage Interest evidenced by this Class F Certificate (obtained by dividing
the principal amount of this Class F Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class F Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class F
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among First Union
Commercial Mortgage Securities, Inc. (herein called the "Depositor", which term
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, herein called the "Master Servicer", which term includes any
successor entity under the Agreement), CRIIMI MAE Services Limited Partnership
(in such capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class F Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class F
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order
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<PAGE>
applicable to all subsequent distributions), or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate,
but taking into account possible future distributions of Additional Interest)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class F Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class F
Certificates are exchangeable for new Class F Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this
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<PAGE>
Certificate for registration of transfer at the offices of the Certificate
Registrar, duly endorsed by, or accompanied by a written instrument of transfer
in the form satisfactory to the Certificate Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Class F Certificates in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.
No transfer of any Class F Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives either: (i) a
certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class F Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class F Certificate without
registration or qualification. Any Class F Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class F Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
Any transferee of this Certificate, if this Certificate is in
book-entry form, shall be deemed to represent to the transferor, the Trustee and
the Depositor that it is a QIB within the meaning of Rule 144A.
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<PAGE>
No service charge will be imposed for any registration of transfer
or exchange of Class F Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class F
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class F
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the
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<PAGE>
Trustee with the consent of the Holders of Certificates entitled to at least 51%
of the Voting Rights allocated to the affected Classes. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, including any
amendment necessary to maintain the status of the Trust Fund (or designated
portions thereof) as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class F Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
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<PAGE>
EXHIBIT A-10
Form of Class G Certificate
<PAGE>
CLASS G COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 7.000% G Certificates as of the Closing
Date: $102,241,582
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class G Certificate as of the
Closing Date: $102,241,582
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AJ 5
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<PAGE>
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST CORPORATION, A NEW YORK CORPORATION ("DTC"), TO THE DEPOSITOR,
THE MASTER SERVICER, THE TRUSTEE, THE CERTIFICATE REGISTRAR OR ANY AGENT THEREOF
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES AND THE CLASS F
CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL
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<PAGE>
REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT, A "PLAN") OR (B) TO ANY PERSON WHO IS DIRECTLY OR
INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH INTEREST HEREIN ON BEHALF OF, AS
NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING, WITHOUT
LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR SEPARATE
ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN), PROVIDED THAT SUCH A
TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (i) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER.
AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE
REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF THIS
CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE
PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
IF THIS CERTIFICATE IS IN BOOK-ENTRY FORM, ANY TRANSFEREE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE REPRESENTED TO THE TRUSTEE, THE DEPOSITOR AND THE
TRANSFEROR TO THE EFFECT (X) THAT IT IS NOT A PERSON DESCRIBED IN CLAUSE (A) OR
CLAUSE (B) OR (Y) AS DESCRIBED IN CLAUSE (i) AND CLAUSE (ii).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES AND THE CLASS F CERTIFICATES
OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF
THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS H, CLASS J, CLASS K,
CLASS L, CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO,
THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN
LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING
CERTIFICATE
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<PAGE>
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that __________ is the registered owner of the
Percentage Interest evidenced by this Class G Certificate (obtained by dividing
the principal amount of this Class G Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class G Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class G
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among First Union
Commercial Mortgage Securities, Inc. (herein called the "Depositor", which term
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, herein called the "Master Servicer", which term includes any
successor entity under the Agreement), CRIIMI MAE Services Limited Partnership
(in such capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class G Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class G
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order
-4-
<PAGE>
applicable to all subsequent distributions), or otherwise by check mailed to the
address of such Certificateholder as it appears in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate
(determined without regard to any possible future reimbursement of any Realized
Loss or Additional Trust Fund Expense previously allocated to this Certificate,
but taking into account possible future distributions of Additional Interest)
will be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class G Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class G
Certificates are exchangeable for new Class G Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this
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<PAGE>
Certificate for registration of transfer at the offices of the Certificate
Registrar, duly endorsed by, or accompanied by a written instrument of transfer
in the form satisfactory to the Certificate Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Class G Certificates in authorized denominations evidencing the same
aggregate Percentage Interest will be issued to the designated transferee or
transferees.
No transfer of any Class G Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives either: (i) a
certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class G Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class G Certificate without
registration or qualification. Any Class G Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class G Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
Any transferee of this Certificate, if this Certificate is in
book-entry form, shall be deemed to represent to the transferor, the Trustee and
the Depositor that it is a QIB within the meaning of Rule 144A.
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<PAGE>
No service charge will be imposed for any registration of transfer
or exchange of Class G Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class F
Certificates.
Notwithstanding the foregoing, for so long as this Certificate is
registered in the name of Cede & Co. or in such other name as is requested by an
authorized representative of DTC, transfers of interests in this Certificate
shall be made through the book-entry facilities of DTC.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class G
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the
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<PAGE>
Trustee with the consent of the Holders of Certificates entitled to at least 51%
of the Voting Rights allocated to the affected Classes. Any such consent by the
Holder of this Certificate shall be conclusive and binding on such Holder and
upon all future Holders of this Certificate and of any Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Agreement also
permits the amendment thereof, in certain limited circumstances, including any
amendment necessary to maintain the status of the Trust Fund (or designated
portions thereof) as a REMIC, without the consent of the Holders of any of the
Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class G Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
-9-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-11
Form of Class H Certificate
<PAGE>
CLASS H COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 7.000% H Certificates as of the Closing
Date: $17,040,241
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class H Certificate as of the
Closing Date: $10,309,530
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AK 2
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES AND THE CLASS G CERTIFICATES OF THE SAME SERIES TO THE EXTENT
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH
RESPECT TO SUCH TRANSFER AND (B)
-2-
<PAGE>
SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT
SUCH TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975
OF THE CODE. AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF THIS CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES AND
THE CLASS G CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS
IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS
J, CLASS K, CLASS L, CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES IS
REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class H Certificate (obtained by dividing
the principal amount of this Class H Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class H Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest
-3-
<PAGE>
evidenced by all the Class H Certificates in the Trust Fund created pursuant to
a Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among First Union Commercial Mortgage Securities, Inc. (herein called the
"Depositor", which term includes any successor entity under the Agreement),
First Union National Bank (in such capacity, herein called the "Master
Servicer", which term includes any successor entity under the Agreement), CRIIMI
MAE Services Limited Partnership (in such capacity, herein called the "Special
Servicer", which term includes any successor entity under the Agreement) and
Norwest Bank Minnesota, National Association (herein called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class H Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class H
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of
-4-
<PAGE>
such final distribution. Also notwithstanding the foregoing, any distribution
that may be made with respect to this Certificate in reimbursement of any
Realized Loss or Additional Trust Fund Expense previously allocated to this
Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class H Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class H
Certificates are exchangeable for new Class H Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class H Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class H Certificate shall be made unless that
transfer is made pursuant to an effective
-5-
<PAGE>
registration statement under the Securities Act, and effective registration or
qualification under applicable state securities laws, or is made in a
transaction which does not require such registration or qualification. If such a
transfer is to be made without registration under the Securities Act (other than
in connection with the initial issuance thereof or the initial transfer thereof
by the Depositor, the Underwriters or their respective affiliates), then the
Certificate Registrar shall refuse to register such transfer unless it receives
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit G-1 to the Agreement, and
a certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class H Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class H Certificate without
registration or qualification. Any Class H Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class H Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class H Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class H
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
-6-
<PAGE>
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class H
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
-7-
<PAGE>
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class H Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
-9-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
CLASS H COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 7.000% H Certificates as of the Closing
Date: $17,040,241
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class H Certificate as of the
Closing Date: $6,730,711
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 2 CUSIP No.337367 AK 2
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES AND THE CLASS G CERTIFICATES OF THE SAME SERIES TO THE EXTENT
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH
RESPECT TO SUCH TRANSFER AND (B)
-2-
<PAGE>
SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT
SUCH TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975
OF THE CODE. AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF THIS CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES AND
THE CLASS G CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS
IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS
J, CLASS K, CLASS L, CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES IS
REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
This certifies that ______________ is the registered owner of the
Percentage Interest evidenced by this Class H Certificate (obtained by dividing
the principal amount of this Class H Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class H Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest
-3-
<PAGE>
evidenced by all the Class H Certificates in the Trust Fund created pursuant to
a Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among First Union Commercial Mortgage Securities, Inc. (herein called the
"Depositor", which term includes any successor entity under the Agreement),
First Union National Bank (in such capacity, herein called the "Master
Servicer", which term includes any successor entity under the Agreement), CRIIMI
MAE Services Limited Partnership (in such capacity, herein called the "Special
Servicer", which term includes any successor entity under the Agreement) and
Norwest Bank Minnesota, National Association (herein called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class H Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class H
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of
-4-
<PAGE>
such final distribution. Also notwithstanding the foregoing, any distribution
that may be made with respect to this Certificate in reimbursement of any
Realized Loss or Additional Trust Fund Expense previously allocated to this
Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class H Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class H
Certificates are exchangeable for new Class H Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class H Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class H Certificate shall be made unless that
transfer is made pursuant to an effective
-5-
<PAGE>
registration statement under the Securities Act, and effective registration or
qualification under applicable state securities laws, or is made in a
transaction which does not require such registration or qualification. If such a
transfer is to be made without registration under the Securities Act (other than
in connection with the initial issuance thereof or the initial transfer thereof
by the Depositor, the Underwriters or their respective affiliates), then the
Certificate Registrar shall refuse to register such transfer unless it receives
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit G-1 to the Agreement, and
a certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class H Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class H Certificate without
registration or qualification. Any Class H Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class H Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class H Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class H
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
-6-
<PAGE>
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class H
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
-7-
<PAGE>
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class H Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
-9-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-12
Form of Class J Certificate
<PAGE>
CLASS J COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% J Certificates as of the Closing
Date: $34,080,482
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class J Certificate as of the
Closing Date: $20,619,060
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AL 0
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES, THE CLASS G CERTIFICATES AND THE CLASS H CERTIFICATES OF THE SAME
SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH
RESPECT TO SUCH TRANSFER AND (B)
-2-
<PAGE>
SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT
SUCH TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975
OF THE CODE. AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES AND THE CLASS H CERTIFICATES OF THE SAME SERIES ARE
REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE
CERTIFICATE PRINCIPAL BALANCE OF THE CLASS K, CLASS L, CLASS M AND CLASS N
CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class J Certificate (obtained by dividing
the principal amount of this Class J Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class J Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest
-3-
<PAGE>
evidenced by all the Class J Certificates in the Trust Fund created pursuant to
a Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among First Union Commercial Mortgage Securities, Inc. (herein called the
"Depositor", which term includes any successor entity under the Agreement),
First Union National Bank (in such capacity, herein called the "Master
Servicer", which term includes any successor entity under the Agreement), CRIIMI
MAE Services Limited Partnership (in such capacity, herein called the "Special
Servicer", which term includes any successor entity under the Agreement) and
Norwest Bank Minnesota, National Association (herein called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class J Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class J
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of
-4-
<PAGE>
such final distribution. Also notwithstanding the foregoing, any distribution
that may be made with respect to this Certificate in reimbursement of any
Realized Loss or Additional Trust Fund Expense previously allocated to this
Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class J Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class J
Certificates are exchangeable for new Class J Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class J Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class J Certificate shall be made unless that
transfer is made pursuant to an effective
-5-
<PAGE>
registration statement under the Securities Act, and effective registration or
qualification under applicable state securities laws, or is made in a
transaction which does not require such registration or qualification. If such a
transfer is to be made without registration under the Securities Act (other than
in connection with the initial issuance thereof or the initial transfer thereof
by the Depositor, the Underwriters or their respective affiliates), then the
Certificate Registrar shall refuse to register such transfer unless it receives
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit G-1 to the Agreement, and
a certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class J Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class J Certificate without
registration or qualification. Any Class J Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class J Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class J Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class J
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
-6-
<PAGE>
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class J
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
-7-
<PAGE>
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class J Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
-9-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
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<PAGE>
CLASS J COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% J Certificates as of the Closing
Date: $34,080,482
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class J Certificate as of the
Closing Date: $13,461,422
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 2 CUSIP No.337367 AL 0
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<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES, THE CLASS G CERTIFICATES AND THE CLASS H CERTIFICATES OF THE SAME
SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH
RESPECT TO SUCH TRANSFER AND (B)
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<PAGE>
SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT
SUCH TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975
OF THE CODE. AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES AND THE CLASS H CERTIFICATES OF THE SAME SERIES ARE
REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE
OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF THE AGGREGATE
CERTIFICATE PRINCIPAL BALANCE OF THE CLASS K, CLASS L, CLASS M AND CLASS N
CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class J Certificate (obtained by dividing
the principal amount of this Class J Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class J Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest
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<PAGE>
evidenced by all the Class J Certificates in the Trust Fund created pursuant to
a Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among First Union Commercial Mortgage Securities, Inc. (herein called the
"Depositor", which term includes any successor entity under the Agreement),
First Union National Bank (in such capacity, herein called the "Master
Servicer", which term includes any successor entity under the Agreement), CRIIMI
MAE Services Limited Partnership (in such capacity, herein called the "Special
Servicer", which term includes any successor entity under the Agreement) and
Norwest Bank Minnesota, National Association (herein called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class J Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class J
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of
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<PAGE>
such final distribution. Also notwithstanding the foregoing, any distribution
that may be made with respect to this Certificate in reimbursement of any
Realized Loss or Additional Trust Fund Expense previously allocated to this
Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class J Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class J
Certificates are exchangeable for new Class J Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class J Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class J Certificate shall be made unless that
transfer is made pursuant to an effective
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<PAGE>
registration statement under the Securities Act, and effective registration or
qualification under applicable state securities laws, or is made in a
transaction which does not require such registration or qualification. If such a
transfer is to be made without registration under the Securities Act (other than
in connection with the initial issuance thereof or the initial transfer thereof
by the Depositor, the Underwriters or their respective affiliates), then the
Certificate Registrar shall refuse to register such transfer unless it receives
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit G-1 to the Agreement, and
a certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class J Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class J Certificate without
registration or qualification. Any Class J Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class J Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class J Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class J
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
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<PAGE>
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class J
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
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<PAGE>
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class J Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
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<PAGE>
EXHIBIT A-13
Form of Class K Certificate
<PAGE>
CLASS K COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% K Certificates as of the Closing
Date: $51,120,723
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class K Certificate as of the
Closing Date: $30,928,589
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AM 8
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<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, 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
CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH
RESPECT TO SUCH TRANSFER AND (B)
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<PAGE>
SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT
SUCH TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975
OF THE CODE. AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES AND THE CLASS J CERTIFICATES
OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF
THE AGGREGATE PRINCIPAL BALANCE OF THE CLASS L, CLASS M AND CLASS N CERTIFICATES
OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE
TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class K Certificate (obtained by dividing
the principal amount of this Class K Certificate (its "Certificate Principal
Balance") as of the
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<PAGE>
Closing Date by the aggregate principal amount of all the Class K Certificates
(their "Class Principal Balance") as of the Closing Date) in that certain
beneficial ownership interest evidenced by all the Class K Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among First Union Commercial Mortgage
Securities, Inc. (herein called the "Depositor", which term includes any
successor entity under the Agreement), First Union National Bank (in such
capacity, herein called the "Master Servicer", which term includes any successor
entity under the Agreement), CRIIMI MAE Services Limited Partnership (in such
capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class K Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class K
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such
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<PAGE>
other location specified in the notice to the Holder hereof of such final
distribution. Also notwithstanding the foregoing, any distribution that may be
made with respect to this Certificate in reimbursement of any Realized Loss or
Additional Trust Fund Expense previously allocated to this Certificate, which
reimbursement is to occur after the date on which this Certificate is
surrendered as contemplated by the preceding sentence, will be made by check
mailed to the address of the Holder that surrenders this Certificate as such
address last appears in the Certificate Register or to any such other address of
which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class K Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class K
Certificates are exchangeable for new Class K Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class K Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
-5-
<PAGE>
No transfer of any Class K Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives either: (i) a
certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class K Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class K Certificate without
registration or qualification. Any Class K Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class K Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class K Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class K
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate
-6-
<PAGE>
Registrar or any such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class K
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
-7-
<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class K Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
-9-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
CLASS K COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% K Certificates as of the Closing
Date: $51,120,723
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class K Certificate as of the
Closing Date: $20,192,134
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 2 CUSIP No.337367 AM 8
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, 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
CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH
RESPECT TO SUCH TRANSFER AND (B)
-2-
<PAGE>
SUCH A TRANSFER MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE
CERTIFICATE REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL
THAT ESTABLISH TO THE REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT
SUCH TRANSFER WILL NOT RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975
OF THE CODE. AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES AND THE CLASS J CERTIFICATES
OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION, IF
THE AGGREGATE PRINCIPAL BALANCE OF THE CLASS L, CLASS M AND CLASS N CERTIFICATES
OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE
TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class K Certificate (obtained by dividing
the principal amount of this Class K Certificate (its "Certificate Principal
Balance") as of the
-3-
<PAGE>
Closing Date by the aggregate principal amount of all the Class K Certificates
(their "Class Principal Balance") as of the Closing Date) in that certain
beneficial ownership interest evidenced by all the Class K Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among First Union Commercial Mortgage
Securities, Inc. (herein called the "Depositor", which term includes any
successor entity under the Agreement), First Union National Bank (in such
capacity, herein called the "Master Servicer", which term includes any successor
entity under the Agreement), CRIIMI MAE Services Limited Partnership (in such
capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class K Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class K
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such
-4-
<PAGE>
other location specified in the notice to the Holder hereof of such final
distribution. Also notwithstanding the foregoing, any distribution that may be
made with respect to this Certificate in reimbursement of any Realized Loss or
Additional Trust Fund Expense previously allocated to this Certificate, which
reimbursement is to occur after the date on which this Certificate is
surrendered as contemplated by the preceding sentence, will be made by check
mailed to the address of the Holder that surrenders this Certificate as such
address last appears in the Certificate Register or to any such other address of
which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class K Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class K
Certificates are exchangeable for new Class K Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class K Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
-5-
<PAGE>
No transfer of any Class K Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives either: (i) a
certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class K Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class K Certificate without
registration or qualification. Any Class K Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class K Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class K Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class K
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate
-6-
<PAGE>
Registrar or any such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class K
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
-7-
<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-9-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class K Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
-8-
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-14
Form of Class L Certificate
<PAGE>
CLASS L COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% L Certificates as of the Closing
Date: $34,080,482
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class L Certificate as of the
Closing Date: $20,619,060
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AN 6
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES, THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J
CERTIFICATES, THE CLASS K AND THE CLASS L CERTIFICATES OF THE SAME SERIES TO THE
EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV
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OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER AND (B) SUCH A TRANSFER
MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE CERTIFICATE REGISTRAR
WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL THAT ESTABLISH TO THE
REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH TRANSFER WILL NOT
RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR
RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF THE CODE. AS A
CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE
REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF SUCH
CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE
PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J CERTIFICATES AND
THE CLASS K CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS
IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS
M CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class L Certificate (obtained by dividing
the principal amount of this Class L Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
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Class L Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class L
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among First Union
Commercial Mortgage Securities, Inc. (herein called the "Depositor", which term
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, herein called the "Master Servicer", which term includes any
successor entity under the Agreement), CRIIMI MAE Services Limited Partnership
(in such capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class L Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class L
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this
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Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class L Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class L
Certificates are exchangeable for new Class L Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class L Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
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No transfer of any Class L Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives either: (i) a
certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class L Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class L Certificate without
registration or qualification. Any Class L Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class L Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class L Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class L
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate
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<PAGE>
Registrar or any such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class L
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class L Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
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<PAGE>
CLASS L COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% L Certificates as of the Closing
Date: $34,080,482
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class L Certificate as of the
Closing Date: $13,461,422
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 2 CUSIP No.337367 AN 6
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<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES, THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J
CERTIFICATES, THE CLASS K AND THE CLASS L CERTIFICATES OF THE SAME SERIES TO THE
EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV
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<PAGE>
OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER AND (B) SUCH A TRANSFER
MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE CERTIFICATE REGISTRAR
WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL THAT ESTABLISH TO THE
REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH TRANSFER WILL NOT
RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR
RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF THE CODE. AS A
CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE
REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF SUCH
CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE
PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J CERTIFICATES AND
THE CLASS K CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS
IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. IN ADDITION, IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCE OF THE CLASS
M CERTIFICATES OF THE SAME SERIES IS REDUCED TO ZERO, THE CERTIFICATE PRINCIPAL
BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN LOSSES AND EXPENSES
EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL
BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class L Certificate (obtained by dividing
the principal amount of this Class L Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
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Class L Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest evidenced by all the Class L
Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among First Union
Commercial Mortgage Securities, Inc. (herein called the "Depositor", which term
includes any successor entity under the Agreement), First Union National Bank
(in such capacity, herein called the "Master Servicer", which term includes any
successor entity under the Agreement), CRIIMI MAE Services Limited Partnership
(in such capacity, herein called the "Special Servicer", which term includes any
successor entity under the Agreement) and Norwest Bank Minnesota, National
Association (herein called the "Trustee", which term includes any successor
entity under the Agreement), a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the respective meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class L Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class L
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this
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<PAGE>
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to the Holder hereof of such final distribution. Also
notwithstanding the foregoing, any distribution that may be made with respect to
this Certificate in reimbursement of any Realized Loss or Additional Trust Fund
Expense previously allocated to this Certificate, which reimbursement is to
occur after the date on which this Certificate is surrendered as contemplated by
the preceding sentence, will be made by check mailed to the address of the
Holder that surrenders this Certificate as such address last appears in the
Certificate Register or to any such other address of which the Trustee is
subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class L Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class L
Certificates are exchangeable for new Class L Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class L Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
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No transfer of any Class L Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives either: (i) a
certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class L Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class L Certificate without
registration or qualification. Any Class L Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class L Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class L Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class L
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate
-6-
<PAGE>
Registrar or any such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class L
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
-7-
<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class L Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-15
Form of Class M Certificate
<PAGE>
CLASS M COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% M Certificates as of the Closing
Date: $17,040,241
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class M Certificate as of the
Closing Date: $17,040,241
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AP 1
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES, THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J
CERTIFICATES, THE CLASS K AND THE CLASS L CERTIFICATES OF THE SAME SERIES TO THE
EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV
-2-
<PAGE>
OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER AND (B) SUCH A TRANSFER
MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE CERTIFICATE REGISTRAR
WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL THAT ESTABLISH TO THE
REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH TRANSFER WILL NOT
RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR
RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF THE CODE. AS A
CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE
REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF SUCH
CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE
PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J CERTIFICATES AND
THE CLASS K CERTIFICATES OF THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS
IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
MADE MONTHLY AS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN. IN ADDITION, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY
BE REDUCED BY CERTAIN LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class M Certificate (obtained by dividing
the principal amount of this Class M Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class M Certificates (their "Class Principal Balance") as of the Closing Date)
in that certain beneficial ownership interest
-3-
<PAGE>
evidenced by all the Class M Certificates in the Trust Fund created pursuant to
a Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among First Union Commercial Mortgage Securities, Inc. (herein called the
"Depositor", which term includes any successor entity under the Agreement),
First Union National Bank (in such capacity, herein called the "Master
Servicer", which term includes any successor entity under the Agreement), CRIIMI
MAE Services Limited Partnership (in such capacity, herein called the "Special
Servicer", which term includes any successor entity under the Agreement) and
Norwest Bank Minnesota, National Association (herein called the "Trustee", which
term includes any successor entity under the Agreement), a summary of certain of
the pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the respective meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class M Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class M
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such other location specified in the notice to the
Holder hereof of
-4-
<PAGE>
such final distribution. Also notwithstanding the foregoing, any distribution
that may be made with respect to this Certificate in reimbursement of any
Realized Loss or Additional Trust Fund Expense previously allocated to this
Certificate, which reimbursement is to occur after the date on which this
Certificate is surrendered as contemplated by the preceding sentence, will be
made by check mailed to the address of the Holder that surrenders this
Certificate as such address last appears in the Certificate Register or to any
such other address of which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class M Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class M
Certificates are exchangeable for new Class M Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class M Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class M Certificate shall be made unless that
transfer is made pursuant to an effective
-5-
<PAGE>
registration statement under the Securities Act, and effective registration or
qualification under applicable state securities laws, or is made in a
transaction which does not require such registration or qualification. If such a
transfer is to be made without registration under the Securities Act (other than
in connection with the initial issuance thereof or the initial transfer thereof
by the Depositor, the Underwriters or their respective affiliates), then the
Certificate Registrar shall refuse to register such transfer unless it receives
either: (i) a certificate from the Certificateholder desiring to effect such
transfer substantially in the form attached as Exhibit G-1 to the Agreement, and
a certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class M Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class M Certificate without
registration or qualification. Any Class M Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class M Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class M Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class M
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate Registrar or any such agent shall be affected
by notice to the contrary.
-6-
<PAGE>
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class M
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
-7-
<PAGE>
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
-8-
<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class M Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-16
Form of Class N Certificate
<PAGE>
CLASS N COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Pass-Through Class Principal Balance of the Class
Rate: 6.150% N Certificates as of the Closing
Date of Pooling and Servicing Initial Certificate Principal Balance
Agreement: as of May 1, 1998 of this Class N Certificate as of the
Closing Date: $34,080,488
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1 CUSIP No.337367 AQ 9
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK, CRIIMI MAE SERVICES LIMITED PARTNERSHIP
OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE
UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1 CERTIFICATES, THE CLASS A-2
CERTIFICATES, THE CLASS IO CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C
CERTIFICATES, THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F
CERTIFICATES, THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J
CERTIFICATES, THE CLASS K, THE CLASS L AND THE CLASS M CERTIFICATES OF THE SAME
SERIES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN") OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN), PROVIDED THAT (A) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE COMPANY
GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER
SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND
(ii) THE CONDITIONS OF SECTIONS I, III AND IV
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<PAGE>
OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER AND (B) SUCH A TRANSFER
MAY BE MADE IF THE PROSPECTIVE TRANSFEREE PROVIDES THE CERTIFICATE REGISTRAR
WITH A CERTIFICATION OF FACTS AND AN OPINION OF COUNSEL THAT ESTABLISH TO THE
REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH TRANSFER WILL NOT
RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR
RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF THE CODE. AS A
CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE CERTIFICATE
REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE OF SUCH
CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF THE
PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY IN
THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
IF THE AGGREGATE CERTIFICATE PRINCIPAL BALANCES OF THE CLASS A-1 CERTIFICATES,
THE CLASS A-2 CERTIFICATES, THE CLASS B CERTIFICATES, THE CLASS C CERTIFICATES,
THE CLASS D CERTIFICATES, THE CLASS E CERTIFICATES, THE CLASS F CERTIFICATES,
THE CLASS G CERTIFICATES, THE CLASS H CERTIFICATES, THE CLASS J CERTIFICATES,
THE CLASS K CERTIFICATES, THE CLASS L CERTIFICATES AND CLASS M CERTIFICATES OF
THE SAME SERIES ARE REDUCED TO ZERO, DISTRIBUTIONS IN REDUCTION OF THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE MADE MONTHLY AS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. IN ADDITION,
THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE REDUCED BY CERTAIN
LOSSES AND EXPENSES EXPERIENCED BY THE TRUST FUND AS SET FORTH IN THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, THE OUTSTANDING
CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT
SHOWN ABOVE.
This certifies that _______________ is the registered owner of the
Percentage Interest evidenced by this Class N Certificate (obtained by dividing
the principal amount of this Class M Certificate (its "Certificate Principal
Balance") as of the Closing Date by the aggregate principal amount of all the
Class M Certificates (their "Class Principal Balance") as of the
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Closing Date) in that certain beneficial ownership interest evidenced by all the
Class N Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among First
Union Commercial Mortgage Securities, Inc. (herein called the "Depositor", which
term includes any successor entity under the Agreement), First Union National
Bank (in such capacity, herein called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership (in such capacity, herein called the "Special Servicer", which term
includes any successor entity under the Agreement) and Norwest Bank Minnesota,
National Association (herein called the "Trustee", which term includes any
successor entity under the Agreement), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders of
the Class N Certificates on the applicable Distribution Date pursuant to the
Agreement. All distributions made under the Agreement on the Class N
Certificates will be made by Norwest Bank Minnesota, National Association, as
paying agent (the "Paying Agent"), by wire transfer of immediately available
funds to the account of the Person entitled thereto at a bank or other entity
having appropriate facilities therefor, if such Certificateholder shall have
provided the Paying Agent with wiring instructions no less than five Business
Days prior to the related Record Date (which wiring instructions may be in the
form of a standing order applicable to all subsequent distributions), or
otherwise by check mailed to the address of such Certificateholder as it appears
in the Certificate Register. Notwithstanding the foregoing, the final
distribution on this Certificate (determined without regard to any possible
future reimbursement of any Realized Loss or Additional Trust Fund Expense
previously allocated to this Certificate, but taking into account possible
future distributions of Additional Interest) will be made in like manner, but
only upon presentation and surrender of this Certificate at the offices of the
Certificate Registrar or such
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other location specified in the notice to the Holder hereof of such final
distribution. Also notwithstanding the foregoing, any distribution that may be
made with respect to this Certificate in reimbursement of any Realized Loss or
Additional Trust Fund Expense previously allocated to this Certificate, which
reimbursement is to occur after the date on which this Certificate is
surrendered as contemplated by the preceding sentence, will be made by check
mailed to the address of the Holder that surrenders this Certificate as such
address last appears in the Certificate Register or to any such other address of
which the Trustee is subsequently notified in writing.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
Any distribution to the Holder of this Certificate in reduction of
the Certificate Principal Balance hereof is binding on such Holder and all
future Holders of this Certificate and any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
distribution is made upon this Certificate.
The Class N Certificates are issuable in fully registered form only
without coupons in minimum denominations specified in the Agreement. As provided
in the Agreement and subject to certain limitations therein set forth, Class N
Certificates are exchangeable for new Class N Certificates in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class N Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
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<PAGE>
No transfer of any Class N Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If such a transfer is to be made without
registration under the Securities Act (other than in connection with the initial
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their respective affiliates), then the Certificate Registrar
shall refuse to register such transfer unless it receives either: (i) a
certificate from the Certificateholder desiring to effect such transfer
substantially in the form attached as Exhibit G-1 to the Agreement, and a
certificate from such Certificateholder's prospective transferee substantially
in the form attached as either Exhibit G-2 or Exhibit G-3 to the Agreement; or
(ii) an Opinion of Counsel reasonably satisfactory to the Certificate Registrar
to the effect that such transfer may be made without registration under the
Securities Act (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with the written certification(s) as to the facts surrounding such transfer from
the Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class N Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class N Certificate without
registration or qualification. Any Class N Certificateholder desiring to effect
such a transfer shall, and by the acceptance of its Class N Certificate agrees
to, indemnify the Trustee, the Certificate Registrar and the Depositor against
any liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No service charge will be imposed for any registration of transfer
or exchange of Class N Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class N
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes whatsoever and
none of the Depositor, the Master Servicer, the Special Servicer, the Trustee,
the Paying Agent, the Certificate
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<PAGE>
Registrar or any such agent shall be affected by notice to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer, the Special Servicer, Lehman
Brothers Inc., the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the Class N
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Special Servicer and the Trustee with the
consent of the Holders of Certificates entitled to at least 51% of the Voting
Rights allocated to the affected Classes. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, including any amendment necessary to
maintain the status of the Trust Fund (or designated portions thereof) as a
REMIC, without the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
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<PAGE>
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class N Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall, if permitted, be made by wire transfer or
otherwise, in immediately available funds, to __________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
_______________________________________________________________________________.
Distributions made by check (such check to be made payable to
_________________________) and all applicable statements and notices should be
mailed to ______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
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<PAGE>
EXHIBIT A-17
Form of Class R-I Certificate
<PAGE>
CLASS R-I MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION COMMERCIAL MORTGAGE SECURITIES, INC.
Date of Pooling and Servicing Percentage Interest evidenced by this
Agreement: as of May 1, 1998 Class R-I Certificate: 100%
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1
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<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS IO, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J, CLASS K, CLASS L,
CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 THE ("SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN). AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF THIS CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
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<PAGE>
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH TRANSFER
RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE.
This certifies that ____________________ is the registered
owner of the Percentage Interest evidenced by this Class R-I Certificate (as
specified above) in that certain beneficial ownership interest evidenced by all
the Class R-I Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among First
Union Commercial Mortgage Securities, Inc. (herein called the "Depositor", which
term includes any successor entity under the Agreement), First Union National
Bank (in such capacity, herein called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership in such capacity, herein called the "Special Servicer", which term
includes any successor entity under the Agreement), and Norwest Bank Minnesota,
National Association (herein called the "Trustee", which term includes any
successor entity under the Agreement), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount, if any, required to be distributed to the
Holders
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<PAGE>
of the Class R-I Certificates on the applicable Distribution Date pursuant to
the Agreement. All distributions made under the Agreement on this Class R-I
Certificate will be made by check mailed to the address of the Person entitled
thereto, as such name and address appear in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate will
be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class R-I Certificates are issuable in fully registered form
only without coupons in minimum denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Class R-I Certificates are exchangeable for new
Class R-I Certificates in authorized denominations evidencing the same aggregate
Percentage Interest, as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class R-I Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class R-I Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If a transfer of any R-I Certificate is to be
made without registration under the Securities Act (other than in connection
with the initial
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<PAGE>
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their affiliates), then the Certificate Registrar shall refuse
to register such transfer unless it receives either: (i) a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit G-1 to the Agreement, and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
either Exhibit G-2 or Exhibit G-3 to the Agreement; or (ii) an Opinion of
Counsel satisfactory to the Certificate Registrar to the effect that such
transfer may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Trust Fund or of the
Depositor, the Master Servicer, the Special Servicer, the Trustee or the
Certificate Registrar in their respective capacities as such), together with the
written certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class R-I Certificates under the Securities
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of any Class R-I Certificate without
registration or qualification. Any Class R-I Certificateholder desiring to
effect such a transfer shall, and by the acceptance of its Class R-I Certificate
agrees to, indemnify the Trustee, the Certificate Registrar and the Depositor
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.
No transfer of this Class R-I Certificate or any interest therein
shall be made to (A) a Plan or (B) any Person who is directly or indirectly
purchasing the Class R-I Certificate or interest therein on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan (including, without
limitation, any insurance company using assets in its general or separate
account that may constitute assets of a Plan). As a condition to its
registration of transfer of this Class R-I Certificate, the Certificate
Registrar shall have the right to require the prospective transferee of such
Certificate, if it is not a Plan or Person described in clause (B) of the
preceding sentence, to execute a certification to that effect substantially in
the form of Exhibit H to the Agreement.
Each Person who has or who acquires any Ownership Interest in this
Certificate shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of Section 5.02(d) of the
Agreement and, if any purported Transferee shall become a Holder of this
Certificate in violation of the provisions of such Section 5.02(d), to have
irrevocably authorized Norwest Bank Minnesota, National
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<PAGE>
Association, as paying agent (the "Paying Agent"), under clause (ii)(A) of such
Section 5.02(d) to deliver payments to a Person other than such Person and to
have irrevocably authorized the Certificate Registrar under clause (ii)(B) of
such Section 5.02(d) to negotiate the terms of any mandatory sale and to execute
all instruments of Transfer and to do all other things necessary in connection
with any such sale. Each Person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee and shall promptly notify the
Master Servicer, the Paying Agent and the Certificate Registrar of any change or
impending change in its status as a Permitted Transferee. In connection with any
proposed Transfer of any Ownership Interest in this Certificate, the Certificate
Registrar shall require delivery to it, and shall not register the Transfer of
this Certificate until its receipt of, an affidavit and agreement substantially
in the form attached as Exhibit I-1 to the Agreement (a "Transfer Affidavit and
Agreement") from the proposed Transferee, in form and substance satisfactory to
the Certificate Registrar, representing and warranting, among other things, that
such Transferee is a Permitted Transferee, that it is not acquiring its
Ownership Interest in this Certificate as a nominee, trustee or agent for any
Person that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in this Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of Section 5.02(d) of the
Agreement and agrees to be bound by them. Notwithstanding the delivery of a
Transfer Affidavit and Agreement by a proposed Transferee, if a Responsible
Officer of the Certificate Registrar has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in this Certificate to such proposed Transferee shall be effected.
Each Person holding or acquiring any Ownership Interest in this
Certificate shall agree (x) to require a Transfer Affidavit and Agreement from
any other Person to whom such Person attempts to transfer its Ownership Interest
herein and (y) not to transfer its Ownership Interest unless it provides to the
Certificate Registrar a certificate substantially in the form attached as
Exhibit I-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring such Ownership Interest, if it is, or is holding such Ownership
Interest on behalf of, a "pass-through interest holder".
The provisions of Section 5.02(d) of the Agreement may be modified,
added to or eliminated, provided that there shall
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<PAGE>
have been delivered to the Certificate Registrar and the Master Servicer the
following: (a) written confirmation from each Rating Agency to the effect that
the modification of, addition to or elimination of such provisions will not
cause such Rating Agency to downgrade its then-current ratings of any Class of
Certificates; and (b) an Opinion of Counsel, in form and substance satisfactory
to the Certificate Registrar and the Master Servicer, to the effect that such
modification of, addition to or elimination of such provisions will not cause
the Trust Fund to (x) cease to qualify as a REMIC or (y) be subject to an
entity-level tax caused by the transfer of this Class R-I Certificate to a
Person which is not a Permitted Transferee, or cause a Person other than the
prospective Transferee to be subject to a REMIC-related tax caused by the
transfer of this Class R-I Certificate to a Person which is not a Permitted
Transferee.
A "Permitted Transferee" is any Transferee other than a
"Disqualified Organization" or a "Non-United States Person". A "Disqualified
Organization" is any of (i) the United States, any State or political
subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing (other than an instrumentality which is
a corporation if all of its activities are subject to tax and, except for the
FHLMC, a majority of its board of directors is not selected by such governmental
unit), (ii) a foreign government, any international organization, or any agency
or instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter I of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381 of the Code and
(v) any other Person so designated by the Trustee based upon an Opinion of
Counsel provided to it that the holding of an Ownership Interest in a Class R-I
Certificate by such Person may cause the Trust Fund or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class
R-I Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
A "Non-United States Person" is any Person other than a United
States Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, an
estate whose income from sources without the United States is income for United
States federal income tax purposes regardless of its
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<PAGE>
connection of a trade or business within the United States, or a trust if a
court within the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the trust, all within the
meaning of Section 7701(a)(30) of the Code.
No service charge will be imposed for any registration of transfer
or exchange of Class R-I Certificates, but the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any transfer or exchange of Class R-I
Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent, the Certificate Registrar or any such agent shall be affected by notice
to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer the Special Servicer, Lehman
Brothers Inc. or the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the
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<PAGE>
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer, the Special Servicer and the Trustee with the consent of the Holders
of Certificates entitled to at least 51% of the Voting Rights allocated to the
affected Classes. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, including any amendment necessary to maintain the
status of the Trust Fund (or designated portions thereof) as a REMIC, without
the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-I Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall be made by check payable to ____________________
_______________________________________________________________________________.
Applicable statements and notices should be mailed to
______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
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<PAGE>
EXHIBIT A-18
Form of Class R-II Certificate
<PAGE>
CLASS R-II MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Date of Pooling and Servicing Percentage Interest evidenced by this
Agreement: as of May 1, 1998 Class R-II Certificate: 100%
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1
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<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS IO, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J, CLASS K, CLASS L,
CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 THE ("SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN). AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF THIS CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
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<PAGE>
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH TRANSFER
RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE.
This certifies that ______________________ is the registered
owner of the Percentage Interest evidenced by this Class R-II Certificate (as
specified above) in that certain beneficial ownership interest evidenced by all
the Class R-II Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among First
Union Commercial Mortgage Securities, Inc. (herein called the "Depositor", which
term includes any successor entity under the Agreement), First Union National
Bank (in such capacity, herein called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership in such capacity, herein called the "Special Servicer", which term
includes any successor entity under the Agreement) and Norwest Bank Minnesota,
National Association (herein called the "Trustee", which term includes any
successor entity under the Agreement), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount, if any, required to be distributed to the
Holders
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<PAGE>
of the Class R-II Certificates on the applicable Distribution Date pursuant to
the Agreement. All distributions made under the Agreement on this Class R-II
Certificate will be made by check mailed to the address of the Person entitled
thereto, as such name and address appear in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate will
be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class R-II Certificates are issuable in fully registered form
only without coupons in minimum denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Class R-II Certificates are exchangeable for new
Class R-II Certificates in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class R-II Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class R-II Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If a transfer of any R-II Certificate is to be
made without registration under the Securities Act (other than in connection
with the initial
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<PAGE>
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their affiliates), then the Certificate Registrar shall refuse
to register such transfer unless it receives either: (i) a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit G-1 to the Agreement, and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
either Exhibit G-2 or Exhibit G-3 to the Agreement; or (ii) an Opinion of
Counsel satisfactory to the Certificate Registrar to the effect that such
transfer may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Trust Fund or of the
Depositor, the Master Servicer, the Special Servicer, the Trustee or the
Certificate Registrar in their respective capacities as such), together with the
written certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class R-II Certificates under the
Securities Act or any other securities law or to take any action not otherwise
required under the Agreement to permit the transfer of any Class R-II
Certificate without registration or qualification. Any Class R-II
Certificateholder desiring to effect such a transfer shall, and by the
acceptance of its Class R-II Certificate agrees to, indemnify the Trustee, the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of this Class R-II Certificate or any interest therein
shall be made to (A) a Plan or (B) any Person who is directly or indirectly
purchasing the Class R-II Certificate or interest therein on behalf of, as named
fiduciary of, as trustee of, or with assets of a Plan (including, without
limitation, any insurance company using assets in its general or separate
account that may constitute assets of a Plan). As a condition to its
registration of transfer of this Class R-II Certificate, the Certificate
Registrar shall have the right to require the prospective transferee of such
Certificate, if it is not a Plan or Person described in clause (B) of the
preceding sentence, to execute a certification to that effect substantially in
the form of Exhibit H to the Agreement.
Each Person who has or who acquires any Ownership Interest in this
Certificate shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of Section 5.02(d) of the
Agreement and, if any purported Transferee shall become a Holder of this
Certificate in violation of the provisions of such Section 5.02(d), to have
irrevocably authorized Norwest Bank Minnesota, National
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<PAGE>
Organization, as paying agent (the "Paying Agent"), under clause (ii)(A) of such
Section 5.02(d) to deliver payments to a Person other than such Person and to
have irrevocably authorized the Certificate Registrar under clause (ii)(B) of
such Section 5.02(d) to negotiate the terms of any mandatory sale and to execute
all instruments of Transfer and to do all other things necessary in connection
with any such sale. Each Person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee and shall promptly notify the
Master Servicer, the Paying Agent and the Certificate Registrar of any change or
impending change in its status as a Permitted Transferee. In connection with any
proposed Transfer of any Ownership Interest in this Certificate, the Certificate
Registrar shall require delivery to it, and shall not register the Transfer of
this Certificate until its receipt of, an affidavit and agreement substantially
in the form attached as Exhibit I-1 to the Agreement (a "Transfer Affidavit and
Agreement") from the proposed Transferee, in form and substance satisfactory to
the Certificate Registrar, representing and warranting, among other things, that
such Transferee is a Permitted Transferee, that it is not acquiring its
Ownership Interest in this Certificate as a nominee, trustee or agent for any
Person that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in this Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of Section 5.02(d) of the
Agreement and agrees to be bound by them. Notwithstanding the delivery of a
Transfer Affidavit and Agreement by a proposed Transferee, if a Responsible
Officer of the Certificate Registrar has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in this Certificate to such proposed Transferee shall be effected.
Each Person holding or acquiring any Ownership Interest in this
Certificate shall agree (x) to require a Transfer Affidavit and Agreement from
any other Person to whom such Person attempts to transfer its Ownership Interest
herein and (y) not to transfer its Ownership Interest unless it provides to the
Certificate Registrar a certificate substantially in the form attached as
Exhibit I-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring such Ownership Interest, if it is, or is holding such Ownership
Interest on behalf of, a "pass-through interest holder".
The provisions of Section 5.02(d) of the Agreement may be modified,
added to or eliminated, provided that there shall
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<PAGE>
have been delivered to the Certificate Registrar and the Master Servicer the
following: (a) written confirmation from each Rating Agency to the effect that
the modification of, addition to or elimination of such provisions will not
cause such Rating Agency to downgrade its then-current ratings of any Class of
Certificates; and (b) an Opinion of Counsel, in form and substance satisfactory
to the Certificate Registrar and the Master Servicer, to the effect that such
modification of, addition to or elimination of such provisions will not cause
the Trust Fund to (x) cease to qualify as a REMIC or (y) be subject to an
entity-level tax caused by the Transfer of any Class R-II Certificate to a
Person which is not a Permitted Transferee, or cause a Person other than the
prospective Transferee to be subject to a REMIC-related tax caused by the
transfer of this Class R-II Certificate to a Person which is not a Permitted
Transferee.
A "Permitted Transferee" is any Transferee other than a
"Disqualified Organization" or a "Non-United States Person". A "Disqualified
Organization" is any of (i) the United States, any State or political
subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing (other than an instrumentality which is
a corporation if all of its activities are subject to tax and, except for the
FHLMC, a majority of its board of directors is not selected by such governmental
unit), (ii) a foreign government, any international organization, or any agency
or instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter I of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381 of the Code and
(v) any other Person so designated by the Trustee based upon an Opinion of
Counsel provided to it that the holding of an Ownership Interest in a Class R-II
Certificate by such Person may cause the Trust Fund or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class
R-II Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
A "Non-United States Person" is any Person other than a United
States Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, an
estate whose income from sources without the United States is income for United
States federal income tax purposes regardless of its
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<PAGE>
connection of a trade or business within the United States, or a trust if a
court within the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the trust, all within the
meaning of Section 7701(a)(30) of the Code.
No service charge will be imposed for any registration of transfer
or exchange of Class R-II Certificates, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
R-II Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent, the Certificate Registrar or any such agent shall be affected by notice
to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer the Special Servicer, Lehman
Brothers Inc. or the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the
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<PAGE>
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer, the Special Servicer and the Trustee with the consent of the Holders
of Certificates entitled to at least 51% of the Voting Rights allocated to the
affected Classes. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, including any amendment necessary to maintain the
status of the Trust Fund (or designated portions thereof) as a REMIC, without
the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-II Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
-1-
<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall be made by check payable to ____________________
_______________________________________________________________________________.
Applicable statements and notices should be mailed to
______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
-2-
<PAGE>
EXHIBIT A-19
Form of Class R-III Certificate
<PAGE>
CLASS R-III MORTGAGE PASS-THROUGH CERTIFICATE,
SERIES 1998-C2
evidencing a beneficial ownership interest in a trust fund (the "Trust Fund")
consisting primarily of a pool of multifamily and commercial mortgage loans (the
"Mortgage Loans"), such pool being formed and sold by
FIRST UNION-LEHMAN BROTHERS-BANK OF AMERICA
COMMERCIAL MORTGAGE TRUST
Date of Pooling and Servicing Percentage Interest evidenced by this
Agreement: as of May 1, 1998 Class R-III Certificate: 100%
Closing Date: May 28, 1998 Aggregate Stated Principal Balance of
the Mortgage Loans as of the Closing
Date: $3,408,048,239
First Distribution Date:
June 18, 1998
Master Servicer: Trustee:
First Union National Bank Norwest Bank Minnesota,
National Association
Special Servicer:
CRIIMI MAE Services Limited
Partnership
Certificate No. 1
-1-
<PAGE>
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN FIRST UNION
COMMERCIAL MORTGAGE SECURITIES, INC., NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, FIRST UNION NATIONAL BANK OR ANY OF THEIR RESPECTIVE AFFILIATES.
NEITHER THIS CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES OR ANY OTHER PERSON.
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A-1, CLASS A-2, CLASS IO, CLASS B,
CLASS C, CLASS D, CLASS E, CLASS F, CLASS G, CLASS H, CLASS J, CLASS K, CLASS L,
CLASS M AND CLASS N CERTIFICATES OF THE SAME SERIES TO THE EXTENT DESCRIBED IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933 THE ("SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO ANY
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING INDIVIDUAL
RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE INVESTMENT FUNDS
AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR ARRANGEMENTS ARE
INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986 (THE "CODE")
(ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, A "PLAN"), OR
(B) TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS CERTIFICATE OR
SUCH INTEREST HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH
ASSETS OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A
PLAN). AS A CONDITION TO REGISTRATION OF TRANSFER OF THIS CERTIFICATE, THE
CERTIFICATE REGISTRAR SHALL HAVE THE RIGHT TO REQUIRE ANY PROSPECTIVE TRANSFEREE
OF SUCH CERTIFICATE, IF IT IS NOT A PLAN OR PERSON DESCRIBED IN CLAUSE (B) OF
THE PRECEDING SENTENCE, TO EXECUTE A CERTIFICATION TO THAT EFFECT SUBSTANTIALLY
IN THE FORM OF EXHIBIT H TO THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
-2-
<PAGE>
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" (A "REMIC") AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE CODE.
CONSEQUENTLY, TRANSFER OF THIS CERTIFICATE IS ALSO SUBJECT TO THE ADDITIONAL TAX
RELATED TRANSFER RESTRICTIONS DESCRIBED HEREIN. IF ANY PERSON BECOMES THE
REGISTERED HOLDER OF THIS CERTIFICATE IN VIOLATION OF SUCH TRANSFER
RESTRICTIONS, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER OR UNDER THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE.
This certifies that ______________________ is the registered
owner of the Percentage Interest evidenced by this Class R-III Certificate (as
specified above) in that certain beneficial ownership interest evidenced by all
the Class R-III Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among First
Union Commercial Mortgage Securities, Inc. (herein called the "Depositor", which
term includes any successor entity under the Agreement), First Union National
Bank (in such capacity, herein called the "Master Servicer", which term includes
any successor entity under the Agreement), CRIIMI MAE Services Limited
Partnership in such capacity, herein called the "Special Servicer", which term
includes any successor entity under the Agreement) and Norwest Bank Minnesota,
National Association (herein called the "Trustee", which term includes any
successor entity under the Agreement), a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the respective meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 18th day of each month or, if such 18th day is not a Business Day, the
Business Day immediately following (each, a "Distribution Date"), commencing on
the first Distribution Date specified above, to the Person in whose name this
Certificate is registered at the close of business on the last Business Day of
the month immediately preceding the month of such distribution (the "Record
Date"), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount, if any, required to be distributed to the
Holders
-3-
<PAGE>
of the Class R-III Certificates on the applicable Distribution Date pursuant to
the Agreement. All distributions made under the Agreement on this Class R-III
Certificate will be made by check mailed to the address of the Person entitled
thereto, as such name and address appear in the Certificate Register.
Notwithstanding the foregoing, the final distribution on this Certificate will
be made in like manner, but only upon presentation and surrender of this
Certificate at the offices of the Certificate Registrar or such other location
specified in the notice to Certificateholders of such final distribution.
The Certificates are limited in right of distribution to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account, the Distribution Account
and, if established, the REO Account may be made from time to time for purposes
other than, and, in certain cases, prior to, distributions to
Certificateholders, such purposes including the reimbursement of advances made,
or certain expenses incurred, with respect to the Mortgage Loans and the payment
of interest on such advances and expenses.
The Class R-III Certificates are issuable in fully registered form
only without coupons in minimum denominations representing Percentage Interests
specified in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Class R-III Certificates are exchangeable for new
Class R-III Certificates in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices of the Certificate Registrar, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Certificate Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class R-III Certificates in
authorized denominations evidencing the same aggregate Percentage Interest will
be issued to the designated transferee or transferees.
No transfer of any Class R-III Certificate shall be made unless that
transfer is made pursuant to an effective registration statement under the
Securities Act, and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. If a transfer of any R-III Certificate is to be
made without registration under the Securities Act (other than in connection
with the initial
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<PAGE>
issuance thereof or the initial transfer thereof by the Depositor, the
Underwriters or their affiliates), then the Certificate Registrar shall refuse
to register such transfer unless it receives either: (i) a certificate from the
Certificateholder desiring to effect such transfer substantially in the form
attached as Exhibit G-1 to the Agreement, and a certificate from such
Certificateholder's prospective transferee substantially in the form attached as
either Exhibit G-2 or Exhibit G-3 to the Agreement; or (ii) an Opinion of
Counsel satisfactory to the Certificate Registrar to the effect that such
transfer may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Trust Fund or of the
Depositor, the Master Servicer, the Special Servicer, the Trustee or the
Certificate Registrar in their respective capacities as such), together with the
written certification(s) as to the facts surrounding such transfer from the
Certificateholder desiring to effect such transfer and/or such
Certificateholder's prospective transferee on which such Opinion of Counsel is
based. None of the Depositor, the Trustee or the Certificate Registrar is
obligated to register or qualify the Class R-III Certificates under the
Securities Act or any other securities law or to take any action not otherwise
required under the Agreement to permit the transfer of any Class R-III
Certificate without registration or qualification. Any Class R-III
Certificateholder desiring to effect such a transfer shall, and by the
acceptance of its Class R-III Certificate agrees to, indemnify the Trustee, the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of this Class R-III Certificate or any interest therein
shall be made to (A) a Plan or (B) any Person who is directly or indirectly
purchasing the Class R-III Certificate or interest therein on behalf of, as
named fiduciary of, as trustee of, or with assets of a Plan (including, without
limitation, any insurance company using assets in its general or separate
account that may constitute assets of a Plan). As a condition to its
registration of transfer of this Class R-III Certificate, the Certificate
Registrar shall have the right to require the prospective transferee of such
Certificate, if it is not a Plan or Person described in clause (B) of the
preceding sentence, to execute a certification to that effect substantially in
the form of Exhibit H to the Agreement.
Each Person who has or who acquires any Ownership Interest in this
Certificate shall be deemed by the acceptance or acquisition of such Ownership
Interest to have agreed to be bound by the provisions of Section 5.02(d) of the
Agreement and, if any purported Transferee shall become a Holder of this
Certificate in violation of the provisions of such Section 5.02(d), to have
irrevocably authorized Norwest Bank Minnesota, National
-5-
<PAGE>
Association, as paying agent (the "Paying Agent"), under clause (ii)(A) of such
Section 5.02(d) to deliver payments to a Person other than such Person and to
have irrevocably authorized the Certificate Registrar under clause (ii)(B) of
such Section 5.02(d) to negotiate the terms of any mandatory sale and to execute
all instruments of Transfer and to do all other things necessary in connection
with any such sale. Each Person holding or acquiring any Ownership Interest in
this Certificate must be a Permitted Transferee and shall promptly notify the
Master Servicer, the Paying Agent and the Certificate Registrar of any change or
impending change in its status as a Permitted Transferee. In connection with any
proposed Transfer of any Ownership Interest in this Certificate, the Certificate
Registrar shall require delivery to it, and shall not register the Transfer of
this Certificate until its receipt of, an affidavit and agreement substantially
in the form attached as Exhibit I-1 to the Agreement (a "Transfer Affidavit and
Agreement") from the proposed Transferee, in form and substance satisfactory to
the Certificate Registrar, representing and warranting, among other things, that
such Transferee is a Permitted Transferee, that it is not acquiring its
Ownership Interest in this Certificate as a nominee, trustee or agent for any
Person that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in this Certificate, it will endeavor to remain a Permitted
Transferee, and that it has reviewed the provisions of Section 5.02(d) of the
Agreement and agrees to be bound by them. Notwithstanding the delivery of a
Transfer Affidavit and Agreement by a proposed Transferee, if a Responsible
Officer of the Certificate Registrar has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in this Certificate to such proposed Transferee shall be effected.
Each Person holding or acquiring any Ownership Interest in this
Certificate shall agree (x) to require a Transfer Affidavit and Agreement from
any other Person to whom such Person attempts to transfer its Ownership Interest
herein and (y) not to transfer its Ownership Interest unless it provides to the
Certificate Registrar a certificate substantially in the form attached as
Exhibit I-2 to the Agreement stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee. Each Person
holding or acquiring an Ownership Interest in this Certificate, by purchasing
such Ownership Interest herein, agrees to give the Master Servicer and the
Trustee written notice that it is a "pass-through interest holder" within the
meaning of temporary Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately
upon acquiring such Ownership Interest, if it is, or is holding such Ownership
Interest on behalf of, a "pass-through interest holder".
The provisions of Section 5.02(d) of the Agreement may be modified,
added to or eliminated, provided that there shall
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<PAGE>
have been delivered to the Certificate Registrar and the Master Servicer the
following: (a) written confirmation from each Rating Agency to the effect that
the modification of, addition to or elimination of such provisions will not
cause such Rating Agency to downgrade its then-current ratings of any Class of
Certificates; and (b) an Opinion of Counsel, in form and substance satisfactory
to the Certificate Registrar and the Master Servicer, to the effect that such
modification of, addition to or elimination of such provisions will not cause
the Trust Fund to (x) cease to qualify as a REMIC or (y) be subject to an
entity-level tax caused by the transfer of this Class R-III Certificate to a
Person which is not a Permitted Transferee, or cause a Person other than the
prospective Transferee to be subject to a REMIC-related tax caused by the
transfer of this Class R-III Certificate to a Person which is not a Permitted
Transferee.
A "Permitted Transferee" is any Transferee other than a
"Disqualified Organization" or a "Non-United States Person". A "Disqualified
Organization" is any of (i) the United States, any State or political
subdivision thereof, any possession of the United States, or any agency or
instrumentality of any of the foregoing (other than an instrumentality which is
a corporation if all of its activities are subject to tax and, except for the
FHLMC, a majority of its board of directors is not selected by such governmental
unit), (ii) a foreign government, any international organization, or any agency
or instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter I of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381 of the Code and
(v) any other Person so designated by the Trustee based upon an Opinion of
Counsel provided to it that the holding of an Ownership Interest in a Class
R-III Certificate by such Person may cause the Trust Fund or any Person having
an Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a Class
R-III Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
A "Non-United States Person" is any Person other than a United
States Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, an
estate whose income from sources without the United States is income for United
States federal income tax purposes regardless of its
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<PAGE>
connection of a trade or business within the United States, or a trust if a
court within the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the trust, all within the
meaning of Section 7701(a)(30) of the Code.
No service charge will be imposed for any registration of transfer
or exchange of Class R-III Certificates, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of Class
R-III Certificates.
The Depositor, the Master Servicer, the Special Servicer, the
Trustee, the Paying Agent and the Certificate Registrar and any agent of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent or the Certificate Registrar may treat the Person in whose name this
Certificate is registered as the owner hereof for all purposes, and none of the
Depositor, the Master Servicer, the Special Servicer, the Trustee, the Paying
Agent, the Certificate Registrar or any such agent shall be affected by notice
to the contrary.
The Trust Fund and the obligations created by the Agreement shall
terminate upon distribution (or provision for distribution) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be distributed to them pursuant to the Agreement following the
earlier to occur of (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Mortgage Loan or REO Property remaining in the
Trust Fund, and (ii) the purchase by the Depositor, the Master Servicer, the
Special Servicer, Lehman Brothers Inc. or the Majority Subordinate
Certificateholder at a price determined as provided in the Agreement of all
Mortgage Loans and each REO Property remaining in the Trust Fund. The Agreement
permits, but does not require, the Master Servicer the Special Servicer, Lehman
Brothers Inc. or the Majority Subordinate Certificateholder or the Depositor to
purchase from the Trust Fund all Mortgage Loans and each REO Property remaining
therein. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate Stated
Principal Balance of the Mortgage Pool at the time of purchase being less than
1% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
Closing Date specified on the face hereof.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Special Servicer and the Trustee and the
rights of the
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<PAGE>
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer, the Special Servicer and the Trustee with the consent of the Holders
of Certificates entitled to at least 51% of the Voting Rights allocated to the
affected Classes. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, including any amendment necessary to maintain the
status of the Trust Fund (or designated portions thereof) as a REMIC, without
the consent of the Holders of any of the Certificates.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
The registered Holder hereof, by its acceptance hereof, agrees that
it will look solely to the Trust Fund (to the extent of its rights therein) for
distributions hereunder.
This Certificate shall be construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
in said State, and the obligations, rights and remedies of the Holder hereof
shall be determined in accordance with such laws.
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<PAGE>
IN WITNESS WHEREOF, the Certificate Registrar has caused this
Certificate to be duly executed.
Dated: May 28, 1998
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Certificate Registrar
By:__________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class R-III Certificates referred to in the
within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION,
as Authenticating Agent
By:__________________________________
Authorized Officer
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<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
the beneficial ownership interest in the Trust Fund evidenced by the within
Commercial Mortgage Pass-Through Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Commercial Mortgage Pass-Through Certificate of a like Percentage Interest and
Class to the above named assignee and deliver such Commercial Mortgage
Pass-Through Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of Assignor
_____________________________________
Signature Guaranteed
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<PAGE>
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall be made by check payable to ____________________
_______________________________________________________________________________.
Applicable statements and notices should be mailed to
______________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________, the
Assignee named above, or ______________, as its agent.
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<PAGE>
EXHIBIT B
Mortgage Loan Schedule
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
1 IBM Corporate Office Complex Route 100 and Route 138
2 Broadmoor Austin 11501 Burnet Road
3 Fox Valley Mall Route 59 and East New York Ave.
4 Hawthorn Center Milwaukee Ave and Town Line Road
5 First Union Plaza 999 Peachtree Street
6 Oakwood Village 185 Route 206
7 Phillips Place 6800 Fairview Road
9 Musselman Portfolio (Roll-Up) Various
9a Comfort Suites (Musselman-Newport) 420 Riverboat Row
9b Comfort Suites (Musselman-Louisville) 1850 Resource Way
9c Comfort Inn (Musselman-Brooks) 149 Willabrook Drive
9d Fairfield Inn (Musselman-Shepherdsville) 362 Brenton Way
9e Sleep Inn (Musselman-Louisville) 1850 Priority Way
9f Days Inn (Musselman-Glasgow) 105 Days Inn Boulevard
9g Comfort Inn (Musselman-Glasgow) 210 Calvary Drive
9h Days Inn (Musselman-Pikeville) 518 South Mayo Trail
9i Days Inn (Musselman-Ashland) 12700 State Road 180
9j Holiday Inn Express (Musselman-Cave City) SEQ of I-65 and Kentucky Highway 90
10 Ohio Edison Office Building 76 South Main Street
11 The Ridge Gardens Apartments 8509 Old Harford Road
12 Holiday Inn Downtown 138 Lafayette Street
13 Peach Tree Apartments 2002-2042 Peach Orchard Drive
14 St. Andrews Place 12100 St. Andrews Place
15 Hunt Club 404 Christopher Ave
16 100 West Chestnut St. 100 West Chestnut St.
17 Hickory Ridge Commons Shopping Center SEC of Winchester Road and Ridgeway Road
18 Holly Hall 2111 Holly Hall Drive
19 1066 Third Avenue (Royale Retail Condominiums) 1066 Third Avenue
20 Richardson Highlands 401 Sherwood Drive
21 Burke Centre Burke Centre Pkwy. & Rte. 123
22 Stallings Portfolio (Loan Level) Various
22a 367 Business & Professional Park (Stallings Portfolio) 12400-12528 Lusher Road
22b Lindbergh Business Center (Stallings Portfolio) 3200-3318 North Highway 67
22c 94 Hemsath Business Center (Stallings Portfolio) 2350 Highway 94 Outer Road South
22d 201 S. Central (Stallings Portfolio) 201 S. Central
22e Medical Arts Building (Stallings Portfolio) 52 Maryland Plaza
22f Lindbergh Center (Stallings Portfolio) 3319-3391 North Highway 67
22g Brown I-270 Professional Building (Stallings Portfolio) 5494 Brown Road
22h Jamestown Business Center (Stallings Portfolio) 4401-4459 North Highway 67
22i 94 Heritage Service Station Mall (Stallings Portfolio) 2550-2600 Old Highway 94 South
22j Lindburgh Park (Stallings Portfolio) 2420-2432 North Highway 67
22k Marietta Plaza (Stallings Portfolio) 13210-13290 New Halls Ferry Road
23 Brinker Trust 11 Various
23a On The Border - Store #16 1121 I-20 West
23b Macaroni Grill - Store #131 5133 S. Padre Island Dr.
23c On The Border - Store #50 4301 S. Broadway
23d On The Border - Store #17 1890 S. Stemmon Frwy.
23e Chili's - Store #332 7621 F.M. 1960
23f Macaroni Grill - Store #37 1670 W. I-20
23g Chili's - Store #520 5025 E. 42nd St.
23h Chili's - Store #272 3710 Call Field Dr.
23i Chili's - Store #326 2800 Judson Rd.
24 Brinker Trust 9 6700-6750 LBJ Freeway
25 Quince Orchard I Apartments 805 Quince Orchard Blvd
26 Levittown Trace Apartments 3000 Ford Rd.
27 Chester Mall Route 17M
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 Somers NY 10589 178,378,814.33 1,561,831.11 6.8300 185 10/01/13
2 Austin TX 78758 154,000,000.00 933,582.22 7.0400 155 04/10/11
3 Aurora IL 60504 85,527,649.00 497,129.46 6.7500 102 11/10/06
4 Vernon Hills IL 60061 77,863,877.00 452,583.79 6.7500 126 11/10/08
5 Atlanta GA 30309 64,000,000.00 415,102.78 6.7500 180 05/01/13
6 Mount Olive NJ 07836 63,766,163.27 441,378.01 7.3600 355 12/01/27
7 Charlotte NC 28200 25,328,344.54 165,094.21 6.7900 119 04/01/08
9 Various KY Various 23,892,525.17 180,051.65 7.6720 116 01/01/08
9a Newport KY 41071
9b Louisville KY 40299
9c Brooks KY 40109
9d Shepherdsville KY 40165
9e Louisville KY 40299
9f Glasgow KY 42141
9g Glasgow KY 42141
9h Pikeville KY 41501
9i Ashland KY 41102
9j Cave City KY 42127
10 Akron OH 44308 22,468,036.24 150,903.88 7.0800 82 03/01/05
11 Baltimore MD 21234 22,168,011.77 149,609.90 7.1100 140 01/01/10
12 New York NY 10013 21,840,552.21 177,903.72 7.5500 56 01/01/03
13 Falls Church VA 22043 21,172,007.68 146,423.13 7.3750 178 03/01/13
14 Miramar FL 33023 20,942,733.05 138,025.22 6.8800 117 02/01/08
15 Gaithersburg MD 20879 20,806,341.65 135,991.59 6.8000 117 02/01/08
16 Chicago IL 60610 20,000,000.00 131,051.84 6.8500 120 05/01/08
17 Memphis TN 38115 17,952,727.94 120,965.75 7.1000 117 02/01/08
18 Houston TX 77054 17,697,000.00 131,585.62 8.1400 110 07/01/07
19 New York NY 10021 17,344,007.86 117,403.24 7.1400 116 01/01/08
20 Marin City CA 94965 16,847,577.42 116,160.25 7.3260 80 01/01/05
21 Burke VA 22015 16,446,273.67 110,662.85 7.0800 176 01/01/13
22 St. Louis MO Various 16,277,350.35 110,311.64 7.1700 118 03/01/08
22a St. Louis County MO 63138
22b Florissant MO 63033
22c St. Charles MO 63303
22d Clayton MO 63105
22e St. Louis MO 63108
22f Florissant MO 63033
22g Hazelwood MO 63042
22h Florissant MO 63034
22i St. Charles MO 63303
22j Florissant MO 63033
22k Florissant MO 63033
23 Various TX Various 15,391,930.50 91,787.23 7.1560 234 11/01/17
23a Arlington TX 76017
23b Corpus Christie TX 78411
23c Tyler TX 75703
23d Lewisville TX 75067
23e Houston TX 77070
23f Arlington TX 76017
23g Odessa TX 79762
23h Witchita Falls TX 78603
23i Longview TX 75605
24 Dallas TX 75240 15,373,841.14 91,679.34 7.1560 234 11/01/17
25 Gaithersburg MD 20876 15,161,953.80 104,858.30 7.3750 178 03/01/13
26 Bristol PA 19007 14,522,217.09 98,536.04 7.1700 177 02/01/13
27 Chester NY 10918 14,488,711.07 99,013.93 7.2600 119 04/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 N 0.0400 0.0050 N - 30/360 Lehman Brothers
2 Y 0.0400 0.0050 Y 2.0000 Act/360 Lehman Brothers
3 N 0.0400 0.0050 Y 2.0000 Act/360 Lehman Brothers
4 N 0.0400 0.0050 Y 2.0000 Act/360 Lehman Brothers
5 360 N 0.0900 0.0050 N - Act/360 First Union
6 N 0.0900 0.0050 N - Act/360 First Union
7 359 N 0.0900 0.0050 N - Act/360 First Union
9 296 Both 0.0900 0.0050 N - Act/360 Lehman Brothers
9a N
9b N
9c Y
9d N
9e N
9f N
9g N
9h Y
9i N
9j N
10 N 0.1150 0.0050 Y 2.0000 Act/360 Lehman Brothers
11 356 N 0.0900 0.0050 N - 30/360 First Union
12 236 N 0.0900 0.0050 N - Act/360 Lehman Brothers
13 358 N 0.0900 0.0050 N - Act/360 First Union
14 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
15 357 N 0.0900 0.0050 N - 30/360 First Union
16 360 N 0.0900 0.0050 N - Act/360 First Union
17 N 0.0950 0.0050 Y 2.0000 Act/360 Lehman Brothers
18 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
19 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
20 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
21 356 N 0.0900 0.0050 N - Act/360 First Union
22 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
22a N
22b N
22c N
22d N
22e N
22f N
22g N
22h N
22i N
22j N
22k N
23 311 N 0.0900 0.0050 N - 30/360 First Union Y
23a N
23b N
23c N
23d N
23e N
23f N
23g N
23h N
23i N
24 311 N 0.0900 0.0050 N - 30/360 First Union Y
25 358 N 0.0900 0.0050 N - Act/360 First Union
26 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
27 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 1.32 63.7 No Y N
2 1.50 76.2 No Y Y
3 1.91 61.5 No Y Y
4 2.00 58.8 No Y Y
5 1.40 61.0 No Y Y
6 1.30 79.7 No Y Y
7 1.29 78.6 No Y Y
9 1.41 68.2 No Y N
9a 2.08 34.1
9b 3.12 92.8
9c 1.65 83.2
9d 0.96 63.6
9e 1.73 75.4
9f 1.21 80.5
9g 1.15 73.4
9h 1.64 82.8
9i 1.22 73.4
9j 0.64 83.1
10 1.42 74.2 No Y Y
11 1.37 79.7 No N N
12 1.53 55.0 No Y Y
13 1.29 78.4 No N Y
14 1.33 77.6 No Y Y
15 1.21 79.6 No Y N
16 1.21 76.5 No N Y
17 1.25 78.2 No Y Y
18 1.22 80.4 No N N
19 1.21 74.4 No N Y
20 1.22 78.4 No Y Y
21 1.51 66.6 No Y Y
22 1.44 74.7 No N Y
22a 1.45 76.8
22b 1.39 69.9
22c 1.38 74.7
22d 1.45 73.3
22e 1.61 76.8
22f 1.40 76.8
22g 1.43 76.8
22h 1.42 76.8
22i 1.48 83.8
22j 1.44 76.8
22k 1.39 61.6
23 Brinker International Y Y 1.00 99.8 No Y N
23a 0.00 0.0
23b 0.00 0.0
23c 0.00 0.0
23d 0.00 0.0
23e 0.00 0.0
23f 0.00 0.0
23g 0.00 0.0
23h 0.00 0.0
23i 0.00 0.0
24 Brinker International Y Y 1.00 100.1 No Y N
25 1.26 74.9 No N Y
26 1.27 79.8 No Y Y
27 1.40 74.7 No Y Y
</TABLE>
B-1
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
28 Peachtree Walk 1074-1075 Peachtree Walk
29 Statesboro Mall U.S. Highway #80 And Brannen Street
30 Days Inn & Suites Historic Savannah 201 West Bay Street
31 Shaws Sainsbury 50 Boston Post Road
32 Sandy Mall 9405-9560 S. 700 East St. & 830 E. 9400 South St.
33 Consolidated Cap Care Properties (8) Various
33a Wynne Skilled 400 Arkansas Street
33b Marianna Highway 79 West
33c Forrest City Intermediate - 500 Kittle Road 500 Kittle Road
33d DeWitt 1325 Liberty Drive
33e Stuttgart West 20th Street
33f Forrest City Skilled - 603 Kittle Road 603 Kittle Road
33g Helena Skilled - 116 November 116 November Drive
33h Helena Intermediate - 111 Hospital 111 Hospital Drive
34 Stone Creek / Waters Landing 12840 Locbury Circle
35 Temple City Square 8847 Las Tunas Drive and 8913 Elm Avenue
36 Hechinger Commons Shopping Center 3101-3231 Duke Street
37 Steeplechase / Largo 150 Steeplechase Way
38 Sandy Springs Plaza 6221 - 6351 Roswell Road NE
39 The Plantation at Lafayette 211 Liberty Ave.
40 North Atherton Place North Atherton & Vairo Road
41 Woodholme Medical Building 1838 Greene Tree Road
42 GTE Stemmons Crossing 9999 West Technology Boulevard
43 Highland Pinetree Apartments 1501 S. Highland Avenue
44 Westmont Business Park (Roll-up) Various
44a SWC of Burr Oak Drive and Chestnut Avenue (Westmont) SWC of Burr Oak Drive and Chestnut Avenue
44b 2-44 Plaza Drive (Westmont) 22-44 Plaza Drive
44c 825 North Cass Avenue (Westmont) 825 North Cass Avenue
44d 640-650 Blackhawk Drive (Westmont) 640-650 Blackhawk Drive
45 Wyndham Garden Hotel 3350 Avenue of the Arts
46 Hulen Bend Center 6080 South Hulen Road
47 Cineplex Odeon Movie Theater 6150 East Avenue
48 Rose Hill II 4910-4926 Knickerbocker Drive
49 Golf Glen Mart Plaza 9000-9196 Golf Road
50 Clearwater Crossing Shopping Center NWC 82nd Street/Dean Road
51 Rivercrest Village Apartments 7928 La Riviera Drive
52 Super K-Mart Center 111 Constitution Drive
53 Quince Orchard II Apartments 805 Quince Orchard Blvd
54 Market at Wolfcreek Germantown Parkway Highway 64 on Stage Road
55 Brinker Trust 5 0
55a Macaroni Grill - Store #106 780 Cobb Place Blvd.
55b On The Border - Store #24 8555 S. Quebec St.
55c Chili's - Store #364 3030 S. Glenstone
55d Chili's - Store #523 301 Constitution
55e Chili's - Store #256 2107 N. Veterans Pkwy.
55f Chili's - Store #421 3580 Broadway
56 Brinker Trust 7 Various
56a Macaroni Grill - Store #53 39300 Seven Mile Rd.
56b Macaroni Grill - Store #84 2572 Citiplace Court
56c On The Border - Store #40 8101 Giacosa Dr.
56d Chili's - Store #500 2319 Iowa St.
56e Chili's - Store #404 9610 Hwy 5
56f Chili's - Store #314 1388 Kildaire Farm Rd.
57 Northwind 1680 Sky Mountain Road
58 Brinker Trust 2 Various
58a Macaroni Grill - Store #50 11100 West Markham
58b Macaroni Grill - Store #115 740 SE Maynard Rd.
58c Chili's - Store #470 1706 E. Cheyenne Mountain Rd.
58d Chili's - Store #302 3795 E. Main St.
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
28 Atlanta GA 30309 14,452,038.73 96,468.86 7.0000 116 01/01/08
29 Statesboro GA 30458 14,288,507.76 96,100.57 7.1000 119 04/01/08
30 Savannah GA 31401 13,770,454.32 100,548.92 7.3400 118 03/01/08
31 Orange CT 44601 13,760,326.29 95,052.20 7.1250 297 02/01/23
32 Sandy UT 84093 13,738,706.98 91,386.77 6.9900 83 04/01/05
33 Various AR Various 13,404,516.00 110,828.06 7.7500 236 01/01/18
33a Wynne AR 72396
33b Marianna AR 72342
33c Forrest City AR 72335
33d Dewitt AR 72042
33e Stuttggart AR 72160
33f Forrest City AR 72335
33g Helena AR 72342
33h Helena AR 72342
34 Germantown MD 20866 13,365,532.22 87,357.98 6.8000 117 02/01/08
35 Temple City CA 91780 13,269,824.24 91,405.09 7.3400 119 04/01/08
36 Alexandria VA 22314 13,230,217.88 87,043.07 6.8750 154 03/01/11
37 Largo MD 20772 13,205,943.83 86,314.90 6.8000 117 02/01/08
38 Sandy Springs
(Atlanta) GA 30328 13,189,312.81 88,374.69 7.0625 119 04/01/08
39 Lafayette LA 70508 12,750,000.00 89,499.33 7.5400 114 11/01/07
40 Patton Township PA 16802 12,469,243.47 88,666.62 7.0400 298 03/01/23
41 Baltimore MD 21208 12,443,167.58 90,924.24 7.6000 115 12/01/07
42 Dallas TX 77071 12,400,000.00 83,582.95 7.1300 120 05/01/08
43 Fullerton CA 92632 12,389,735.13 82,081.54 6.9500 119 04/01/08
44 Westmont IL 60559 12,218,749.98 83,732.84 7.2700 81 02/01/05
44a Westmont IL 60559
44b Westmont IL 60559
44c Westmont IL 60559
44d Westmont IL 60559
45 Costa Mesa CA 92626 12,204,210.32 89,255.38 7.3400 117 02/01/08
46 Fort Worth TX 76132 12,168,124.07 82,234.84 7.1300 117 02/01/08
47 Hodgkins IL 60525 12,124,123.68 93,793.98 7.9900 297 02/01/23
48 Alexandria VA 22310 11,980,750.16 80,846.22 7.1250 118 03/01/08
49 Niles IL 60714 11,863,983.65 82,799.48 7.4500 80 01/01/05
50 Indianapolis IN 46250 11,569,846.73 78,425.57 7.1600 177 02/01/13
51 Sacramanto CA 95826 11,564,174.06 79,904.97 7.3480 116 01/01/08
52 West Monroe LA 71292 11,283,800.93 94,734.07 8.3400 254 07/01/19
53 Gaithersburg MD 20878 10,979,483.59 75,932.83 7.3750 178 03/01/13
54 Memphis TN 38101 10,947,916.37 78,400.40 7.6825 173 10/01/12
55 0 GA Various 10,671,795.87 63,639.47 7.1560 234 11/01/17
55a Kennesaw GA 30144
55b Highlands Ranch CO 80126
55c Springfield MO 65804
55d W. Monroe LA 71292
55e Bloomington IL 61704
55f Edmond OK 73013
56 Various MI Various 10,585,153.28 63,122.81 7.1560 234 11/01/17
56a Livonia MI 48152
56b Baton Rouge LA 70808
56c Memphis TN 38133
56d Lawrence KS 66046
56e Douglasville GA 30135
56f Cary NC 27511
57 Reno NV 89503 10,585,106.73 71,414.16 7.1250 118 03/01/08
58 Various AR Various 10,513,286.94 62,694.24 7.1560 234 11/01/17
58a Little Rock AR 72211
58b Cary NC 27511
58c Colorado Springs CO 80906
58d St. Charles IL 60174
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
28 356 N 0.0900 0.0050 N - Act/360 First Union
29 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
30 298 N 0.0900 0.0050 N - Act/360 Lehman Brothers
31 N 0.0900 0.0050 N - 30/360 First Union Y
32 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
33 N 0.0900 0.0050 N - Act/360 First Union
33a N
33b N
33c N
33d N
33e N
33f N
33g N
33h N
34 357 N 0.0900 0.0050 N - 30/360 First Union
35 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
36 358 N 0.0900 0.0050 N - Act/360 First Union
37 357 N 0.0900 0.0050 N - 30/360 First Union
38 359 N 0.0900 0.0050 N - Act/360 First Union
39 360 N 0.0900 0.0050 N - Act/360 First Union
40 Y 0.1400 0.0050 N - 30/360 Lehman Brothers
41 319 N 0.0900 0.0050 N - Act/360 First Union
42 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
43 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
44 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
44a N
44b N
44c N
44d N
45 297 N 0.0900 0.0050 N - Act/360 Lehman Brothers
46 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
47 N 0.0900 0.0050 N - 30/360 Lehman Brothers
48 358 N 0.0900 0.0050 N - 30/360 First Union
49 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
50 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
51 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
52 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
53 358 N 0.0900 0.0050 N - Act/360 First Union
54 353 N 0.1500 0.0050 N - Act/360 Lehman Brothers
55 311 N 0.0900 0.0050 N - 30/360 First Union Y
55a N
55b N
55c N
55d N
55e N
55f N
56 311 N 0.0900 0.0050 N - 30/360 First Union Y
56a N
56b N
56c N
56d N
56e N
56f N
57 358 N 0.0900 0.0050 N - Act/360 First Union
58 311 N 0.0900 0.0050 N - 30/360 First Union Y
58a N
58b N
58c N
58d N
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
28 1.26 72.3 No Y Y
29 1.41 71.8 No Y Y
30 1.40 74.4 No N Y
31 J. Sainsbury PLC 1.00 99.0 No N N
32 1.29 72.3 No Y Y
33 2.00 55.4 No Y N
33a 0.00 0.0
33b 0.00 0.0
33c 0.00 0.0
33d 0.00 0.0
33e 0.00 0.0
33f 0.00 0.0
33g 0.00 0.0
33h 0.00 0.0
34 1.27 79.8 No Y N
35 1.29 79.9 No Y Y
36 1.43 71.9 No Y Y
37 1.30 79.8 No Y N
38 1.30 79.9 No Y Y
39 1.21 75.0 No N Y
40 1.42 75.1 No Y N
41 1.40 71.5 No N N
42 1.27 71.3 No Y Y
43 1.33 78.2 No N Y
44 1.31 72.6 No Y Y
44a 0.00 72.6
44b 0.00 72.6
44c 0.00 72.6
44d 0.00 72.6
45 1.40 56.8 No Y Y
46 1.21 74.9 No Y Y
47 1.25 74.4 No Y N
48 1.26 79.9 No N N
49 1.20 78.6 No Y Y
50 1.31 78.7 No Y Y
51 1.24 79.8 No Y Y
52 K-Mart 1.02 93.3 No Y N
53 1.25 74.9 No N Y
54 1.44 71.4 LB-H Y N
55 Brinker International Y Y 1.00 99.7 No Y N
55a 0.00 0.0
55b 0.00 0.0
55c 0.00 0.0
55d 0.00 0.0
55e 0.00 0.0
55f 0.00 0.0
56 Brinker International Y Y 1.00 99.8 No Y N
56a 0.00 0.0
56b 0.00 0.0
56c 0.00 0.0
56d 0.00 0.0
56e 0.00 0.0
56f 0.00 0.0
57 1.27 79.7 No Y Y
58 Brinker International Y Y 1.00 99.9 No Y N
58a 0.00 0.0
58b 0.00 0.0
58c 0.00 0.0
58d 0.00 0.0
</TABLE>
B-2
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
58e Chili's - Store # 309 9009 E. 71st Street
58f Chili's - Store #329 1161 Old Salem Rd.
59 Concorde Centre II Office Building 2999 NE 191st Street
60 Sundance West Apartments 3245 Clover Way
61 Old Farm 3751 Appian Way
62 River Reach 628 River Reach Dr.
63 Maplewood Center 8200-8300 Shoppers Square
64 Health Care South(6 Prop) Various
64a Toombs Nursing Home 181 Oxley Drive
64b Brentwood Terrace Health Center 115 Brentwood Drive
64c Lee County Health Care 214 Main Street
64d Liliann G. Carter Nursing Home 225 Hospital Street
64e Sparta Health Care Center Broad Street/Military Highway 22
64f Oconee Health Care Center 107 Ridgview Drive
65 Spinnaker Reach Apartments 3875 San Pablo Rd.
66 Inverrary 441 Apartments 1196 NW 40th Avenue
67 Eastland Plaza 678 North Wilson Way
68 Woodhaven Apartments 625 South Redwood Road
69 Best Western Greenfield Inn 3000 Enterprise Drive
70 Hampton Inn Pensacola Beach Two Via Del Luna
71 Plaza LaFayette 13011 - 13051 Newport Avenue
72 The Broun Portfolio Consolidation Various
72a The Glen 148 Governors Court
72b The Mews Apartments 249 Meadows Drive
72c Meadowlark Apartments 101 Meadowlark Drive
73 North Willow Commons Shopping Center 1410-1520 West 86th Street
74 International Club Apartments 1900 SW 122nd Avenue
75 Village Green Apartments 222 South Clovis Avenue
76 Liberty Gardens 101 Liberty Garden Road
77 Park Forest 7529 Fleta
78 Kings Harbor Multicare Center 2000 East Gun Hill Road
80 Briarcliffe Lakeside Apartments 1750 East 22nd Street
81 Daytona Beach Hilton Oceanfront Resort 2637 S. Atlantic Avenue
82 Valley Manor 141C Marina Drive
83 North Oaks Plaza 7151 Natural Bridge Road
84 The Morrison Building 6525 Morrison Boulevard
85 Sandstone Apartments 405 East Prince Road
86 Innsbrook Village 800 E Nichols Blvd
87 1616 Walnut Street 1616 Walnut Street
88 Century Village Apartments 4801 Spencer Street
89 Hampton Inn (Louisville) 800 Phillips Lane
90 Hampton Inn & Suites - Pineville 401 Towne Centre Boulevard
91 La Villita Apartments 1550 E Harmon
92 White Marlin Mall, Phase I North Side of U.S. Route 50
93 Claremont Retirement Village 7041 Bent Tree Blvd.
94 Brookside West Apartments 420 Berman Road
95 Harris Boulevard I 5100 West Harris Bouldevard
96 Scott Mountain by the Brook 7828 SE Aspen Summit Drive
97 Classic Portfolio (Roll-up) Various
97a 2 Horatio Street (Classic Portfolio) 2 Horatio Street
97b 162 W. 56th Street (Classic Portfolio) 162 W. 56th Street
97c 400 E. 52nd Street (Classic Portfolio) 400 E. 52nd Street
97d 45 E. 66th Street (Classic Portfolio) 45 E. 66th Street
97e 129 E. 82nd Street (Classic Portfolio) 129 E. 82nd Street
98 Oak Hills Medical Plaza 7345 Medical Center Drive
99 North Point - Springhouse Phase I 5010 Split Rail Drive
100 Kensington Club Apartments 14250 Kimberley Lane
101 Village Green Office Park 5655 Lindero Canyon Road
102 West Georgia Commons North Side of Lafayette Parkway
103 Colleyville Court 4904 Colleyville Road
104 Tlaquepaque Arts & Crafts Village 336 State Highway 179
105 Innsbrook Shoppes 4206 Cox Road
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
58e Tulsa OK 74133
58f Conyers GA 30207
59 Aventura FL 33180 10,500,000.00 72,199.14 7.3300 120 05/01/08
60 Reno NV 89509 10,092,322.04 68,214.00 7.1250 116 01/01/08
61 Lexington KY 40517 9,968,198.82 67,878.82 7.2000 116 01/01/08
62 Orlando FL 32828 9,932,082.23 69,128.75 7.4400 358 03/01/28
63 Manassas Park VA 20111 9,745,742.13 67,657.93 7.3960 116 01/01/08
64 Various GA Various 9,717,397.08 81,666.44 7.9500 115 12/01/07
64a Lyons GA 30436
64b Waynesboro GA 30830
64c Leesburg GA 31763
64d Plains GA 31780
64e Sparta GA 31087
64f Oconee GA 31067
65 Jacksonville FL 32224 9,687,495.88 67,624.66 7.4700 358 03/01/28
66 Lauderhill FL 33133 9,586,461.99 64,579.81 7.1100 118 03/01/08
67 Stockton CA 95202 9,565,038.58 66,304.81 7.3750 115 12/01/07
68 Salt Lake City UT 84104 9,530,000.00 70,860.08 8.1400 110 07/01/07
69 Allen Park MI 48101 9,265,237.21 67,761.23 7.3400 177 02/01/13
70 Pensacola Beach FL 32561 9,250,000.00 65,731.55 7.0600 120 05/01/08
71 Tustin CA 92780 9,242,654.04 62,537.63 7.1600 155 04/01/11
72 Atlanta GA Various 9,237,003.50 62,318.96 7.1250 118 03/01/08
72a Cartersville GA 30120
72b Loganville GA 30249
72c McDonough GA 30253
73 Washington Township IN 46278 9,205,383.81 61,469.42 7.0100 177 02/01/13
74 Miami FL 33175 9,186,994.22 61,826.94 7.1000 118 03/01/08
75 Frenso CA 93727 9,177,123.74 63,824.51 7.4200 116 01/01/08
76 Bergenfield NJ 07621 9,136,905.79 61,182.74 7.0500 118 03/01/08
77 St. Louis MO 63123 8,970,695.39 60,361.55 7.0800 176 01/01/13
78 Bronx NY 10469 8,951,209.01 74,664.64 7.8900 237 02/01/18
80 Wheaton IL 60187 8,776,084.48 57,956.81 6.9000 117 02/01/08
81 Daytona Beach Shores FL 32118 8,281,860.32 59,886.06 7.2300 118 02/29/08
82 Edison NJ 08817 8,174,179.08 55,938.46 7.2500 176 01/01/13
83 Northwoods MO 63121 8,093,897.78 56,220.97 7.4250 239 04/01/18
84 Charlotte NC 28211 8,050,981.33 58,286.68 7.2000 115 12/01/07
85 Tuscon AZ 85705 7,983,000.00 59,357.40 8.1400 110 07/01/07
86 Sparks NV 89434 7,924,512.91 53,743.19 7.1590 116 01/01/08
87 Philadelphia PA 19103 7,794,129.65 54,165.35 7.4300 119 04/01/08
88 Las Vegas NV 89119 7,774,993.83 52,729.16 7.1590 116 01/01/08
89 Louisville KY 40209 7,771,500.87 57,641.31 7.5000 117 02/01/08
90 Pineville NC 28134 7,766,189.12 59,557.21 7.8750 116 01/01/08
91 Las Vegas NV 89119 7,765,332.63 53,771.69 7.3560 114 11/01/07
92 Ocean City MD 21842 7,743,942.22 52,816.11 7.2400 119 04/01/08
93 Columbus OH 43235 7,589,517.39 51,587.90 7.2000 118 03/01/08
94 Augusta GA 30909 7,579,696.26 50,562.99 7.0000 117 02/01/08
95 Charlotte NC 28269 7,400,000.00 57,817.15 7.1000 240 05/01/18
96 Portland OR 97266 7,377,558.77 51,438.18 7.4400 116 01/01/08
97 New York NY Various 7,201,769.35 49,645.50 7.3300 117 02/01/08
97a New York NY 10001
97b New York NY 10001
97c New York NY 10001
97d New York NY 10021
97e New York NY 10028
98 West Hills CA 91307 7,181,443.42 48,921.50 7.2100 117 02/01/08
99 Winston-Salem NC 27106 7,171,377.96 48,945.88 7.2150 115 12/01/07
100 Houston TX 77079 7,131,286.58 48,146.75 7.1200 117 02/01/08
101 Westlake Village CA 91362 7,096,616.22 51,601.86 7.8630 114 11/01/07
102 LaGrange GA 30241 7,094,294.06 47,714.27 7.1000 119 04/01/08
103 Collyville TX 76034 7,081,449.20 47,857.98 7.1300 117 02/01/08
104 Sedona AZ 86336 7,055,984.78 49,447.89 7.5100 118 03/01/08
105 Glen Allen VA 23060 7,000,000.00 48,228.05 7.3500 180 05/01/13
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
58e N
58f N
59 360 N 0.1150 0.0050 N - Act/360 Lehman Brothers
60 356 N 0.0900 0.0050 N - Act/360 Bank of America
61 356 N 0.0900 0.0050 N - Act/360 First Union
62 N 0.0900 0.0050 N - Act/360 First Union
63 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
64 235 N 0.0900 0.0050 N - Act/360 First Union
64a N
64b N
64c N
64d N
64e N
64f N
65 N 0.0900 0.0050 N - Act/360 First Union
66 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
67 355 N 0.0900 0.0050 N - Act/360 First Union
68 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
69 297 N 0.0900 0.0050 N - Act/360 First Union
70 300 N 0.1500 0.0050 N - Act/360 Lehman Brothers
71 359 N 0.0900 0.0050 N - Act/360 First Union
72 358 N 0.0900 0.0050 N - Act/360 First Union
72a N
72b N
72c N
73 N 0.0950 0.0050 Y 2.0000 Act/360 Lehman Brothers
74 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
75 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
76 358 N 0.1150 0.0050 N - Act/360 First Union
77 356 N 0.0900 0.0050 N - 30/360 First Union
78 Y 0.0900 0.0050 N - Act/360 First Union
80 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
81 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
82 356 N 0.0900 0.0050 N - Act/360 First Union
83 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
84 295 N 0.0900 0.0050 N - 30/360 First Union
85 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
86 356 N 0.0900 0.0050 N - Act/360 Bank of America
87 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
88 356 N 0.0900 0.0050 N - Act/360 Bank of America
89 297 N 0.1400 0.0050 N - Act/360 Lehman Brothers
90 296 N 0.0900 0.0050 N - Act/360 First Union
91 354 N 0.0900 0.0050 N - Act/360 Bank of America
92 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
93 358 N 0.0900 0.0050 N - Act/360 First Union
94 357 N 0.0900 0.0050 N - Act/360 First Union
95 N 0.0900 0.0050 N - Act/360 First Union
96 356 N 0.0900 0.0050 N - Act/360 First Union
97 Both 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
97a N
97b N
97c Y
97d N
97e N
98 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
99 355 N 0.0900 0.0050 N - 30/360 First Union
100 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
101 354 N 0.0900 0.0050 N - Act/360 Bank of America
102 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
103 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
104 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
105 360 N 0.0900 0.0050 N - Act/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
58e 0.00 0.0
58f 0.00 0.0
59 1.30 73.4 No Y Y
60 1.57 74.8 No Y Y
61 1.31 79.8 No Y Y
62 1.26 84.9 No N Y
63 1.45 73.3 No Y Y
64 1.71 60.3 No Y N
64a 0.00 0.0
64b 0.00 0.0
64c 0.00 0.0
64d 0.00 0.0
64e 0.00 0.0
64f 0.00 0.0
65 1.21 83.5 No N Y
66 1.36 79.9 No N Y
67 1.26 79.7 No Y Y
68 1.26 73.3 No N N
69 1.40 64.3 No Y Y
70 2.20 60.9 No Y Y
71 1.26 73.9 No Y Y
72 1.50 79.5 No N Y
72a 0.00 0.0
72b 0.00 0.0
72c 0.00 0.0
73 1.32 78.7 No Y Y
74 1.31 79.9 No N Y
75 1.22 78.3 No N Y
76 1.33 79.8 No Y Y
77 1.41 70.4 No N N
78 2.33 20.8 No Y N
80 1.25 79.8 No Y Y
81 1.48 59.2 No Y Y
82 1.25 79.4 No N Y
83 1.30 74.9 No N Y
84 1.68 64.9 No N N
85 1.19 79.8 No N N
86 1.53 74.8 No Y Y
87 1.42 71.5 No Y Y
88 1.39 74.8 No Y Y
89 1.49 74.7 No Y Y
90 1.38 74.5 Panos Y N
91 1.33 79.2 No Y Y
92 1.35 71.7 No Y Y
93 1.64 69.0 No Y Y
94 1.30 75.8 No N Y
95 1.26 71.7 No N Y
96 1.25 78.5 No N Y
97 1.34 72.0 No Y Y
97a 0.00 0.0
97b 0.00 0.0
97c 0.00 0.0
97d 0.00 0.0
97e 0.00 0.0
98 1.34 68.4 No Y Y
99 1.29 79.7 No N N
100 1.26 77.9 No Y Y
101 1.46 74.7 No Y N
102 1.32 68.5 No Y Y
103 1.29 74.8 No Y Y
104 1.25 73.5 No Y Y
105 1.35 74.9 No Y Y
</TABLE>
B-3
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
106 Glen Harbor Plaza S/W/C School Street and Highland Road
107 Hulen Fashion Center 5200 South Hulen Street
108 Decatur Crossing Shopping Center 248 South Decatur Blvd
109 Montgomery Street 135 Montgomery Street
110 City Place 133 Stuart Street
111 Sunscape West Apartments 8840 19th St.
112 Orangebrook Manor Apartments 5400 Yarmouth Avenue
113 Trinity Place Apartments 1331 Trinity Place
114 Le Med Apartments 950 W. Sierra Madre Avenue
115 Pleasant Hills Villas 5520 Pleasant Hill Avenue
116 Westminster Plaza 12109-12121 Westheimer Road
117 Legacy Apartments 1411 East Orangewood Avenue
118 Valley Breeze Apartments 1394 Oro Vista Road
119 City Center Building 227 Bronough Street
120 Dublin Mall U.S. Highway 80 and Shamrock Drive
121 Fountain Court 6355-6605 Manatee Avenue
122 New Market Mall NEQ I 270 & Sawmill Road
123 Highgate Apartments 5710 Fourth St.
124 Playa Blanca Apartments 1905-79 Avenida Del Mexico
125 Minges Brook Mall 5700 Beckley Road
126 The Addison 831 E. Morehead St.
127 Carolina Apartments 401 Highway 54 Bypass
128 Holiday Inn Lynchburg 601 Main Street
129 PalmTree Plaza 3513-3533 Canon Road
130 Victoria Apartments 414-444 South Ardmore Avenue
131 Pelham at Hyland Business Center Pelham Road at Hyland Road
132 Franklin Plaza 281-339 Bickett Boulevard
133 Cumberland Green 26 Ladow Avenue
134 Spring Center 8627 16th Street
135 Rose Hill I 6200-6268 Rose Hill Drive
136 Officemax and Best Buy 2420 & 2452 East Springs Drive
137 Two Executive Boulevard Two Executive Boulevard
138 Green Grove 99 Green Grove
139 Constantine Village 26 Constantine Place
141 Shoppes of Olney 3110-3134 Olney Sandy Spring Road
142 United HealthCare Office Bldg 13621 NW 12th Street
143 Linden Court Apartments 372 S. Ironwood Ave.
144 Serra Commons Apartments 1580 Southgate Boulevard
145 A & P Grocery Store 179 Stonington Road (U.S. Route 1)
146 540 Atlantic Avenue 540 Atlantic Avenue
147 Maple Leaf Plaza 540 Water Street
148 Holiday Inn City Center 175 East Town Street
149 53, 53-West, and 102 Commerce Center 10551 and 10791 NW 53rd Street and 5401 and 5405 N
150 K & K Warehousing - 701 Fourth Avenue 701 Fourth Avenue
151 Emerald Apartments 964 President Avenue
152 MacArthur Plaza I & II 7945 MacArthur Boulevard and 6500 Seven Locks Road
153 Mount Vernon 38-A Mount Vernon Drive
154 Evergreen Plaza 1710 Route 38
155 21 DuPont Circle 21 DuPont Circle
156 1-3 Parklands Drive (Parkland Office Park) 1-3 Parklands Drive
157 Payne Ranch Centre SWC of Grand Ave. & Peyton Drive
158 Leonardine Gardens 110 Leonardine Avenue
159 Kroger La Grange 203 Commerce Avenue
160 Park Encino Apartments 5325 Newcastle Avenue
161 Wickes Shopping Center 800 Central Expressway North
162 Ashby Square West Shopping Center SEC of West Broad Street & Tuckernuck Drive
163 Hampton Inn Detroit Metro Airport 30847 Flynn Drive
164 Commerce Park of Palm Beach County 3111 Fortune Way
165 Forest Glen Apartments 1639 North Forest Road
166 Home - Springhouse Phase II 5010 Split Rail Drive
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
106 Glen Cove NY 11542 6,990,558.40 47,942.40 7.2900 70 03/01/04
107 Fort Worth TX 76132 6,968,150.86 51,619.17 7.1200 129 02/01/09
108 Las Vegas NV 89107 6,943,380.22 47,643.31 7.2630 114 11/01/07
109 Jersey City NJ 07302 6,900,000.00 46,184.25 7.0600 360 05/01/28
110 Boston MA 02116 6,892,159.81 51,080.19 7.5200 119 04/01/08
111 Rancho Cucamonga CA 91701 6,839,980.49 45,389.35 6.9600 118 03/01/08
112 Encino CA 91316 6,838,693.78 45,798.00 7.0510 118 03/01/08
113 Middletown OH 45042 6,794,491.45 45,514.91 7.0600 119 04/01/08
114 Azusa CA 91702 6,744,467.08 44,907.92 7.0000 119 04/01/08
115 Las Vegas NV 89103 6,732,378.75 45,521.57 7.1350 117 02/01/08
116 Houston TX 77077 6,690,963.03 45,887.73 7.2900 118 03/01/08
117 Phoenix AZ 85020 6,683,917.14 47,431.40 7.6270 117 02/01/08
118 San Diego CA 92154 6,671,562.47 47,173.54 7.5710 114 11/01/07
119 Tallahassee FL 32301 6,656,983.36 44,140.29 6.9400 117 02/01/08
120 Dublin GA 31021 6,594,695.89 44,354.11 7.1000 119 04/01/08
121 Bradenton FL 34209 6,592,324.44 48,238.06 7.3750 119 04/01/08
122 Columbus OH 43235 6,584,429.79 44,978.88 7.2400 57 02/01/03
123 Lubbock TX 79416 6,583,249.29 45,247.68 7.3000 117 02/01/08
124 San Diego CA 92154 6,582,428.06 43,998.65 7.0200 117 02/01/08
125 Battle Creek MI 49015 6,574,953.93 45,922.40 7.4500 235 12/01/17
126 Charlotte NC 28204 6,555,555.55 48,773.42 7.5000 114 11/01/07
127 Carrboro NC 27510 6,547,029.36 45,320.04 7.3900 359 04/01/28
128 Lynchburg VA 24504 6,493,025.24 49,631.01 7.8750 119 04/01/08
129 Oceanside CA 92056 6,474,751.79 46,231.31 7.0700 297 02/01/23
130 Los Angeles CA 90020 6,458,862.87 43,421.03 7.0710 116 01/01/08
131 Greenville SC 29615 6,402,356.16 43,986.27 7.3000 117 02/01/08
132 Louisburg NC 27549 6,395,007.39 43,659.28 7.2500 239 04/01/18
133 Millville NJ 08332 6,381,293.31 45,298.80 7.6250 116 01/01/08
134 Silver Spring MD 20910 6,350,417.94 42,885.03 7.1100 175 12/01/12
135 Alexandria VA 22310 6,322,891.20 42,773.51 7.1500 118 03/01/08
136 Madison WI 53704 6,320,000.00 42,429.81 7.0900 120 05/01/08
137 Montebello NY 10901 6,295,095.15 43,019.85 7.2600 119 04/01/08
138 Keyport NJ 07735 6,294,961.98 42,444.27 7.1250 179 04/01/13
139 Summit NJ 07836 6,276,579.44 43,105.37 7.2800 355 12/01/27
141 Olney MD 20832 6,244,629.40 40,578.93 6.7600 191 04/01/14
142 Sunrise FL 33304 6,200,000.00 45,013.94 7.3000 128 01/01/09
143 Rialto CA 92376 6,190,931.25 41,082.33 6.9600 118 03/01/08
144 Daly City CA 94014 6,177,199.24 42,631.87 7.3300 115 12/01/07
145 Stonington CT 06355 6,163,226.67 45,600.94 7.4200 293 10/01/22
146 Brooklyn NY 11217 6,123,872.54 47,466.70 8.0000 116 01/01/08
147 Chardon OH 44024 6,077,175.58 41,612.75 7.2500 115 12/01/07
148 Columbus OH 43215 6,073,664.24 46,677.41 7.9000 80 01/01/05
149 Sunrise FL 33321 5,993,027.80 43,872.20 7.3800 119 04/01/08
150 Menominee MI 49858 5,989,329.78 48,795.22 7.6250 119 04/01/08
151 Toms River NJ 08753 5,984,430.12 40,605.51 7.1700 177 02/01/13
152 Cabin John MD 20818 5,983,970.74 39,918.15 7.0000 117 02/01/08
153 Vernon CT 06066 5,982,462.46 42,467.63 7.6250 116 01/01/08
154 Mount Holly NJ 08060 5,982,208.81 42,170.84 7.5530 116 01/01/08
155 Washington DC 20036 5,795,439.34 39,408.99 7.2100 119 04/01/08
156 Darien CT 06820 5,792,389.77 40,158.03 7.4000 118 03/01/08
157 Chino Hills CA 91709 5,785,128.07 39,526.89 7.2400 177 02/01/13
158 South River NJ 08882 5,784,398.59 38,431.86 6.9600 357 02/01/28
159 LaGrange GA 30241 5,774,542.54 42,557.86 7.3750 236 01/01/18
160 Encino CA 91316 5,727,244.22 38,354.74 7.0510 118 03/01/08
161 Plano TX 75074 5,707,136.81 38,831.45 7.2100 118 03/01/08
162 Richmond VA 23220 5,685,607.37 39,193.83 7.3300 117 02/01/08
163 Romulus MI 48174 5,678,693.80 41,531.07 7.3400 177 02/01/13
164 Wellington FL 33414 5,585,217.47 37,520.58 7.0700 117 02/01/08
165 La Grange Park IL 60526 5,575,834.45 39,133.01 7.4940 114 11/01/07
166 Winston-Salem NC 27106 5,502,009.30 37,003.16 7.0750 116 01/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
106 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
107 Y 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
108 354 N 0.0900 0.0050 N - Act/360 Bank of America
109 N 0.0900 0.0050 N - Act/360 First Union
110 299 Y 0.0900 0.0050 N - Act/360 Lehman Brothers
111 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
112 358 N 0.0900 0.0050 N - Act/360 Bank of America
113 359 Y 0.0900 0.0050 N - 30/360 First Union
114 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
115 357 N 0.0900 0.0050 N - Act/360 Bank of America
116 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
117 357 N 0.0900 0.0050 N - Act/360 Bank of America
118 354 N 0.0900 0.0050 N - Act/360 Bank of America
119 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
120 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
121 299 N 0.0900 0.0050 N - Act/360 First Union
122 N 0.0900 0.0050 Y 2.0000 30/360 Lehman Brothers
123 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
124 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
125 N 0.0900 0.0050 Y 2.0000 30/360 Lehman Brothers
126 294 N 0.0900 0.0050 N - Act/360 First Union
127 N 0.0900 0.0050 N - Act/360 First Union
128 299 N 0.0900 0.0050 N - Act/360 First Union
129 N 0.0900 0.0050 N - Act/360 First Union
130 356 N 0.0900 0.0050 N - Act/360 Bank of America
131 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
132 359 N 0.0900 0.0050 N - Act/360 First Union
133 356 N 0.0900 0.0050 N - Act/360 First Union
134 355 N 0.0900 0.0050 N - Act/360 First Union
135 358 N 0.0900 0.0050 N - 30/360 First Union
136 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
137 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
138 359 N 0.0900 0.0050 N - Act/360 First Union
139 N 0.0900 0.0050 N - Act/360 First Union
141 359 N 0.0900 0.0050 N - Act/360 First Union
142 300 N 0.0900 0.0050 N - Act/360 First Union
143 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
144 355 N 0.1650 0.0050 N - Act/360 Lehman Brothers
145 Y 0.0400 0.0050 N - 30/360 Lehman Brothers Y
146 296 N 0.0900 0.0050 N - Act/360 First Union
147 355 N 0.0900 0.0050 N - Act/360 First Union
148 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
149 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
150 239 N 0.0900 0.0050 N - Act/360 First Union
151 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
152 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
153 356 N 0.0900 0.0050 N - Act/360 First Union
154 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
155 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
156 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
157 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
158 N 0.0900 0.0050 N - Act/360 First Union
159 293 N 0.0900 0.0050 N - 30/360 First Union Y
160 358 N 0.0900 0.0050 N - Act/360 Bank of America
161 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
162 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
163 297 N 0.0900 0.0050 N - Act/360 First Union
164 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
165 354 N 0.0900 0.0050 N - Act/360 Bank of America
166 356 N 0.0900 0.0050 N - 30/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
106 1.32 69.9 No Y Y
107 1.28 72.6 No Y Y
108 1.44 73.9 No Y Y
109 1.26 49.3 No Y Y
110 1.50 62.7 No Y Y
111 1.30 72.0 No Y Y
112 1.40 72.1 No Y Y
113 1.33 80.9 No Y N
114 1.27 78.9 No N Y
115 1.31 77.4 No Y Y
116 1.36 73.5 No Y Y
117 1.34 74.0 No Y N
118 1.20 76.5 No Y Y
119 1.47 73.2 No Y Y
120 1.30 71.7 No Y Y
121 1.27 74.9 No Y Y
122 1.21 74.8 No N N
123 1.37 79.3 No Y Y
124 1.32 79.1 No Y Y
125 1.30 78.5 No Y N
126 1.25 76.5 No N Y
127 1.26 77.9 No Y Y
128 1.50 58.5 No Y N
129 1.39 71.9 No Y Y
130 1.57 79.7 No Y Y
131 1.28 74.0 No Y Y
132 1.25 79.9 No Y Y
133 1.30 70.9 No N N
134 1.41 74.7 No Y Y
135 1.26 74.4 No Y N
136 1.34 79.0 No Y Y
137 1.32 74.9 No Y Y
138 1.22 79.7 No N Y
139 1.68 67.9 No Y Y
141 1.45 68.6 No Y Y
142 1.54 50.0 No Y Y
143 1.41 79.9 No Y Y
144 1.23 76.6 No Y Y
145 A & P 1.05 96.3 No Y N
146 1.42 69.0 No Y N
147 1.30 76.0 No N Y
148 1.64 47.1 No Y N
149 1.38 74.9 No Y Y
150 1.45 69.4 K&K Y N
151 1.45 79.8 No Y Y
152 1.47 78.0 No Y Y
153 1.52 63.0 No N N
154 1.31 73.9 No N Y
155 1.31 72.4 No Y Y
156 1.40 72.4 No Y Y
157 1.58 60.3 No Y Y
158 1.27 79.8 No N Y
159 Kroger Company Y Y 1.02 95.5 No Y N
160 1.34 74.3 No Y Y
161 1.52 73.6 No Y Y
162 1.36 77.9 No Y Y
163 1.44 64.5 No Y Y
164 1.54 60.7 No N Y
165 1.56 78.5 No Y Y
166 1.36 79.7 No N N
</TABLE>
B-4
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
167 Southside Comfort Inn 120 West Third Street
168 Mill Park Apartments 2900 McCann Road
169 Warehouse Specialists - Enterprise Park 3.5, 4, 5 8511-8555 Martin Drive
170 Grand Central Station Shopping Center 8756 Research Blvd
171 Ramada Inn Newburgh 1055 Union Avenue
172 73 Spring Street Limited Partnership 67-73 Spring Street
173 Beacon Mill Village 2 Main Street
174 Club at Woodland Pond 13801 North 37th Street
175 La Maison 2308 & 2408 Houma Blvd
176 Connecticut Avenue Days Inn 4400 Connecticut Avenue, NW
177 Dill Creek Commons Shopping Center 1360 West Wade Hampton Blvd.
178 Whole Foods Market 711 University Avenue
179 One Sentry Parkway One Sentry Parkway
180 Hampton Inn - Matthews 9615 Independence Point Parkway
181 Cambridge House 250 Bellbrook Avenue
182 Alta Vista Gardens Apartments 1425 North Alta Vista Blvd.
183 Kato Road 48835-48881 Kato Road
184 Hearthside 8214 Wilson Drive
185 Hampton Inn - Concord 612 Dicken Place
186 Reddmans Pier Apartments 5826 Reddman Road
187 Budgetel Inn 3701 SW 38th Avenue
188 Hillside Village Center E/S Route 111
189 Kroger Huntsville 8404 South Memorial Parkway
191 Thrifty's (Roll-Up) Various
191a Thrifty's Neighborhood Center (South Pasadena) 900-914 Fair Oaks Avenue
191b 2421 West Rosecrans Avenue (Thrifty's-Gardena) 2421 West Rosecrans Avenue
191c Thrifty Drug Store No. 650 (Thrifty's Calexico) 244 E. 3rd Street
191d 72 Springstowne Center (Thrifty's Vallejo) 72 Springtowne Center
192 Kelly House 106 St. Philip Street
193 Tiffany Corner Shopping Center NEQ of Cactus Road and 67th Avenue
194 Timbers of Pine Hollow Apartments 2020 Plantation Drive
195 Hampton Inn - Gatlinburg, TN 967 Parkway
197 Agoura Hills Town Center 30105-30135 Agoura Road
198 Foxhill Apartments 1900 South Missouri Street
200 Southpoint Shopping Center 12855 Gulf Freeway
201 Provincial Towers Apartments 34 South Main Street
202 Royal Palms Mobile Home/RV Park 7901 E. Ben White Boulevard
203 K&K Warehousing - 3100 Woleske Rd 3100 Woleske Road
204 Park Plaza - Salem 123-129 South Broadway
205 Fairesta Apartments 3250 Fairesta Street
206 Villa Park I 8040 Villa Park Drive
207 Cody's Books 1716 4Th Street
208 Village Faire Shoppes 1100-1198 South Coast Highway
209 South Trust Building 402 Kentucky Avenue
210 South Ridge Apartments 440 West Oak Ridge Road
211 Fairfield Inn Shreveport 6245 Westport Avenue
212 Santa Ana Plaza 710-810 South Harbor Blvd
213 Oxford Point 106 Old Lincoln Highway
214 Minges Creek Plaza 5420 Beckley Road
215 TransFlorida Bank Plaza 1347-1671 South University Drive
216 Chesapeake Square U.S. Highway No. 13
217 Orchard Plaza Plank Road and Orchard Avenue
218 Sunnyview 4502 Sunnyview Drive
219 Plaza Codorniz 4300 North Miller Road
220 J.P. Morgan Building 109 Royal Palm Way
221 Villa Creek Apartments 2601 McBride Lane
222 Seminary Place Shopping Center 9440-9524 Georgia Avenue
223 Vernon Gardens 695 Talcottville Road
224 Kingston Apartments 2701-2731 North Andrews Avenue
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
167 Bethlehem PA 18018 5,493,855.16 41,092.76 7.6250 179 04/01/13
168 Longview TX 75605 5,486,000.00 40,791.02 8.1400 110 07/01/07
169 Clayton WI 54956 5,467,635.82 50,790.54 7.4375 178 03/01/13
170 Austin TX 78758 5,394,496.51 38,358.39 7.3750 116 01/01/08
171 Newburgh NY 12550 5,394,205.59 41,231.91 7.8750 119 04/01/08
172 New York NY 10012 5,382,520.27 36,326.14 7.1100 116 01/01/08
173 Beacon Falls CT 06403 5,377,345.73 38,220.86 7.6250 354 11/01/27
174 Tampa FL 33613 5,355,892.91 36,892.42 7.3400 119 04/01/08
175 Metairie LA 70001 5,355,527.84 35,336.83 6.9100 119 04/01/08
176 Washington DC 20008 5,350,000.00 39,536.03 7.5000 120 05/01/08
177 Greer SC 29650 5,349,731.63 42,764.71 7.3000 236 01/01/18
178 San Diego CA 92103 5,331,911.30 36,727.23 7.3400 119 04/01/08
179 Whitpain Township PA 19422 5,292,378.31 35,367.88 7.0300 118 03/01/08
180 Matthews NC 28105 5,277,025.94 40,468.36 7.8750 116 01/01/08
181 Bristol TN 37620 5,271,218.92 43,919.90 7.8750 237 02/01/18
182 Los Angeles CA 90046 5,246,083.97 35,532.44 7.1460 116 01/01/08
183 Fremont CA 94539 5,183,443.80 35,275.87 7.1940 116 01/01/08
184 Ralston NE 68127 5,120,000.00 33,634.76 6.8750 120 05/01/08
185 Concord NC 28025 5,077,892.90 38,941.25 7.8750 116 01/01/08
186 Charlotte NC 28212 5,019,965.16 34,262.12 7.2150 115 12/01/07
187 Ocala FL 34474 4,994,436.22 37,438.78 7.6500 119 04/01/08
188 Smithtown NY 11787 4,993,729.36 35,020.64 6.9000 119 04/01/08
189 Huntsville AL 35801 4,987,105.52 36,799.57 7.3750 236 01/01/18
191 Various CA Various 4,936,933.47 33,165.45 7.0700 117 02/01/08
191a South Pasadena CA 91030
191b Gardena CA 90249
191c Calexico CA 92231
191d Vallejo CA 94591
192 Charleston SC 29403 4,907,580.45 32,343.91 6.8800 117 02/01/08
193 Glendale AZ 85304 4,904,313.30 33,091.81 7.1161 81 02/01/05
194 Conroe TX 77301 4,896,093.16 33,061.84 7.1400 119 04/01/08
195 Gatlinburg TN 37738 4,865,111.39 36,423.12 7.6250 118 03/01/08
197 Agoura Hills CA 91301 4,850,614.46 36,169.49 7.8750 114 11/01/07
198 Casper WY 82609 4,787,972.59 33,152.41 7.3750 117 02/01/08
200 Houston TX 77034 4,735,219.11 32,596.91 7.3100 80 01/01/05
201 Wilkes-Barre PA 18701 4,662,868.47 31,638.46 7.1700 177 02/01/13
202 Austin TX 78741 4,600,000.00 31,598.81 7.3200 120 05/01/08
203 Marinette WI 54153 4,591,819.50 37,409.67 7.6250 119 04/01/08
204 Salem NH 03079 4,588,483.58 31,786.73 7.3800 117 02/01/08
205 Glendale CA 91214 4,587,970.90 30,991.05 7.1250 117 02/01/08
206 Richmond VA 23228 4,573,974.74 34,368.49 7.6250 175 12/01/12
207 Berkeley CA 94710 4,493,754.73 30,469.35 7.1750 118 03/01/08
208 Laguna Beach CA 92651 4,489,166.80 31,804.30 7.6100 177 02/01/13
209 Lakeland FL 33801 4,488,810.52 31,218.51 7.4200 117 02/01/08
210 Orlando FL 32809 4,485,830.01 30,697.93 7.2500 116 01/01/08
211 Shreveport LA 71129 4,483,464.26 33,137.61 7.4600 117 02/01/08
212 Santa Ana CA 92704 4,482,358.10 30,965.66 7.3460 116 01/01/08
213 Falls Township PA 19030 4,479,383.97 34,209.10 8.1300 114 11/01/07
214 Battle Creek MI 49015 4,445,732.34 32,043.08 7.4900 119 04/01/08
215 Plantation FL 33324 4,393,961.09 29,926.28 7.2200 118 03/01/08
216 Onley VA 23418 4,393,749.31 29,510.09 7.0800 118 03/01/08
217 Logan Township PA 16601 4,389,461.37 31,690.20 7.2100 298 03/01/23
218 Oklahoma City OK 73135 4,356,682.39 30,113.44 7.3750 119 04/01/08
219 Scottsdale AZ 85251 4,246,854.08 29,754.46 7.5130 119 04/01/08
220 Palm Beach FL 33480 4,196,597.85 28,112.15 7.0600 119 04/01/08
221 Santa Rosa CA 95403 4,196,581.00 28,041.50 7.0350 83 04/01/05
222 Silver Spring MD 20901 4,191,649.51 31,835.49 6.7100 239 04/01/18
223 Vernon CT 06066 4,188,585.76 27,661.21 6.9000 177 02/01/13
224 Wilton Manors FL 33311 4,180,514.34 30,901.16 7.4500 56 01/01/03
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
167 299 N 0.0900 0.0050 N - Act/360 First Union
168 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
169 N 0.0900 0.0050 N - Act/360 First Union
170 326 N 0.0900 0.0050 N - Act/360 First Union
171 299 N 0.0900 0.0050 N - Act/360 First Union
172 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
173 N 0.0900 0.0050 N - Act/360 First Union
174 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
175 359 N 0.0900 0.0050 N - Act/360 First Union
176 300 Both 0.0900 0.0050 N - Act/360 First Union
177 N 0.0900 0.0050 N - Act/360 First Union
178 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
179 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
180 296 N 0.0900 0.0050 N - Act/360 First Union
181 N 0.0900 0.0050 N - Act/360 First Union
182 356 N 0.0900 0.0050 N - Act/360 Bank of America
183 356 N 0.0900 0.0050 N - Act/360 Bank of America
184 360 N 0.0900 0.0050 N - Act/360 First Union
185 296 N 0.0900 0.0050 N - Act/360 First Union
186 355 N 0.0900 0.0050 N - 30/360 First Union
187 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
188 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
189 292 N 0.0900 0.0050 N - 30/360 First Union Y
191 357 Both 0.1400 0.0050 N - Act/360 Lehman Brothers
191a Both
191b Both
191c Both
191d Both
192 357 Both 0.0900 0.0050 N - Act/360 First Union
193 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
194 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
195 298 N 0.0900 0.0050 N - Act/360 First Union
197 324 N 0.0900 0.0050 N - Act/360 First Union
198 357 N 0.0900 0.0050 N - Act/360 First Union
200 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
201 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
202 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
203 239 N 0.0900 0.0050 N - Act/360 First Union
204 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
205 357 N 0.0900 0.0050 N - Act/360 Bank of America
206 295 N 0.0900 0.0050 N - 30/360 First Union
207 358 N 0.0900 0.0050 N - Act/360 Bank of America
208 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
209 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
210 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
211 297 N 0.0900 0.0050 N - Act/360 First Union
212 356 N 0.0900 0.0050 N - Act/360 Bank of America
213 321 N 0.0900 0.0050 N - Act/360 First Union
214 323 N 0.1400 0.0050 N - Act/360 Lehman Brothers
215 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
216 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
217 N 0.1400 0.0050 N - 30/360 Lehman Brothers
218 359 N 0.0900 0.0050 N - Act/360 First Union
219 359 N 0.0900 0.0050 N - Act/360 Bank of America
220 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
221 359 N 0.0900 0.0050 N - Act/360 Bank of America
222 N 0.0900 0.0050 N - Act/360 First Union
223 357 N 0.0900 0.0050 N - Act/360 First Union
224 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
167 1.54 74.2 No Y N
168 1.25 78.4 No N N
169 1.27 63.6 WSI II Y Y
170 1.26 74.4 No N Y
171 1.40 69.6 No Y N
172 1.39 74.8 No Y Y
173 1.50 71.7 No N N
174 1.30 79.9 No Y Y
175 1.49 79.9 No Y Y
176 1.51 70.9 No Y Y
177 1.29 74.4 No Y Y
178 1.25 79.9 No N Y
179 1.36 57.7 No Y Y
180 1.52 74.6 Panos Y N
181 1.37 78.7 No Y N
182 1.31 74.9 No Y Y
183 1.62 64.8 No Y Y
184 1.31 80.0 No Y Y
185 1.40 73.6 Panos Y N
186 1.26 79.7 No N N
187 1.49 74.5 No Y N
188 1.72 60.2 No Y Y
189 Kroger Company Y Y 1.02 94.1 No Y N
191 1.35 73.1 No Y Y
191a 1.20 66.5
191b 1.41 80.3
191c 1.52 79.8
191d 1.51 80.2
192 1.32 77.3 No N Y
193 1.31 74.7 No N Y
194 1.28 75.3 No Y Y
195 1.44 74.9 No Y N
197 1.39 74.6 No Y N
198 1.29 73.7 No N Y
200 1.30 75.2 No Y Y
201 1.23 77.7 No Y Y
202 1.37 78.6 No Y Y
203 1.44 76.4 K&K Y N
204 1.26 78.4 No Y Y
205 1.28 79.8 No Y Y
206 1.32 65.8 No Y N
207 1.48 62.9 No Y Y
208 1.26 56.1 No Y N
209 1.26 70.7 No Y Y
210 1.25 73.5 No N Y
211 1.41 69.0 No Y Y
212 1.36 74.7 No Y Y
213 1.34 72.8 No Y N
214 1.40 74.0 No N Y
215 1.49 72.0 No Y Y
216 1.28 75.1 No Y Y
217 1.31 74.4 No Y N
218 1.34 79.9 No Y Y
219 1.26 72.0 No Y Y
220 1.28 71.1 No Y Y
221 1.39 73.6 No Y Y
222 1.55 55.9 No Y Y
223 1.25 76.2 No Y Y
224 1.27 78.4 No Y Y
</TABLE>
B-5
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
225 Glengary Shopping Center 5950-6010 Westerville Road
226 1696 and 1700 to 1712 Newport Boulevard 1696 and 1700 to 1712 Newport Boulevard
227 Tarzana Tennis Club Apts. 18440 Hatteras Street
228 Ramada Inn & Suites 1410 South Country Club Drive
229 L.A. Community College 2340 Firestone Boulevard
230 Walgreens Pharmacy (Chicago) NWC West Fullerton Avenue & North Central Avenue
231 Karl Plaza Shopping Center 1620 Dublin Granville Road
232 Villa Serrano 201 South Magnolia
233 Kendale Plaza Shopping Center S/E Corner of Lee Avenue and Main Street
234 Sunrise Vista 300 South Val Vista Drive
235 Best Buy (Little Rock) Chenal Parkway & Bowman Road
236 Alice Nettell Tower 550 Third Avenue North
237 Seagate Facility 5898 Condor Drive
238 Hunters Crossing 2801 Bill Owens Parkway
239 54-57 South Street 54-57 South Street
240 Hansen Village Apartments 11821 Foothill Boulevard
241 Oakwood Apartments 4050 NE 1st Avenue
242 Lake Loft Center 641 West Lake Street
243 5210 Maryland Way Office Building NEC of Maryland Way and Westwood Place
244 Milestone Hopewell Road
245 Fashion Village and East Colonial Shopping Centers 3817 & 3907-3915 East Colonial Drive
246 Arnold Industrial Park 1361 Airport Road North
247 Derby Ridge 67 Blue Stone Court
248 Ventana Row 2352 Shattuck Avenue
249 New Hampshire Apartments 445 South New Hampshire Ave
250 Superstition Marketplace 1155 South Power Road
251 Blue Grass Plaza 2417 Welsh Road (PA 532)
252 Merrill Crossing Shopping Ctr. 9119 Merrill Road
253 River Creek Apartments 2525 Center West Parkway
254 Village Green 1000-1013 Village Green, 1005-1013 Milan Drive
255 Spartan Square Shopping Center 1435-1499 W. Main St.
256 Winn Dixie Eustis 1951 State Road 19 North
257 Versailles of Rockford 5145 East State Street
258 Lynnwood Manor Health Care Center 5821 188th Street S.W.
259 Tri-County Square U.S. Highway 25E
260 Bethesda Court Hotel 7740 Wisconsin Avenue
261 Winn Dixie Orangeburg 1481 Chestnut Street
262 Roswell Mill Office Buildings 85 Mill Street
263 Highland Tech Center 8925,8955,8985 East Nichols Avenue
264 Stor-All Properties Various
264a 1880 Dr. Andre's Way 1880 Dr. Andre's Way
264b 7388 Central Industrial Way 7388 Central Industrial Way
264c 330-358 Northeast 4th Street 330-358 Northeast 4th Street
265 Parole Office Park 130, 132 and 134 Holiday Court
266 McEvers Corners 975 Dawsonville Road
267 Windscape II Apartments 3099 Parhan Drive
268 Courtyards Apartments 1906 Sam Houston Drive
269 Miami Gardens Plaza 18351 Northwest 27th Avenue
270 Village South 1243 Bay Area Blvd
271 Webtron Building 2030 W. McNab Road
272 Fairway Center 9115 Southwest Oleson Road
273 Santa Fe Square Northeast Corner of Southern Avenue & Gilbert Road
274 Gomes Plaza 1057-1075 Blossom Hill Road
275 Covington Square 4828 Zenith Street
276 Best Buy (Sioux Falls) 2104 W. 41st Street
277 Parkway Nursing Home 525 13th Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
225 Blendon Township OH 43081 4,174,404.10 28,713.70 7.3200 118 03/01/08
226 Costa Mesa CA 92627 4,164,473.16 28,758.54 7.3600 118 03/01/08
227 Tarzana CA 91356 4,150,453.39 27,795.14 7.0510 118 03/01/08
228 Mesa AZ 85210 4,145,337.26 30,911.49 7.5900 239 04/01/18
229 South Gate CA 90280 4,121,706.60 44,695.39 7.2280 135 08/01/09
230 Chicago IL 60630 4,119,422.58 30,785.00 7.3600 236 01/01/18
231 Columbus OH 43229 4,114,484.43 28,301.54 7.3200 118 03/01/08
232 Anaheim CA 92804 4,111,868.60 29,639.51 7.7768 115 12/01/07
233 Sanford NC 27330 4,094,344.90 27,830.32 7.2000 118 03/01/08
234 Mesa AZ 85204 4,093,770.79 26,734.40 6.8020 118 03/01/08
235 Little Rock AR 72211 4,092,586.34 33,004.26 7.4900 239 04/01/18
236 Virginia MN 55792 4,085,108.18 29,397.77 7.1600 297 02/01/23
237 Moorpark CA 93021 4,082,680.29 28,929.34 7.5930 114 11/01/07
238 Longview TX 75605 4,076,595.82 26,898.18 6.9100 119 04/01/08
239 Morristown NJ 07016 4,000,000.00 29,235.19 7.3750 120 05/01/08
240 Lake View Terrace CA 91342 3,996,904.34 27,395.66 7.2900 119 04/01/08
241 Oakland Park FL 33334 3,990,036.80 27,722.49 7.4100 177 02/01/13
242 Chicago IL 60661 3,987,665.78 27,575.23 7.3560 116 01/01/08
243 Brentwood TN 37027 3,987,379.97 27,259.93 7.2400 116 01/01/08
244 Williamsport MD 21795 3,956,704.30 29,374.90 7.5000 296 01/01/23
245 Orlando FL 32803 3,932,520.25 28,736.26 7.9100 113 10/01/07
246 Naples FL 34104 3,925,345.74 28,796.66 7.3750 117 02/01/08
247 Lakeside Park KY 41017 3,888,336.27 27,296.08 7.5100 116 01/01/08
248 Berkeley CA 94704 3,881,505.61 28,345.44 7.3120 80 01/01/05
249 Los Angeles CA 90020 3,836,194.01 26,777.54 7.4460 115 12/01/07
250 Mesa AZ 85206 3,800,000.00 26,453.96 7.2500 177 02/01/13
251 Philadelphia PA 19114 3,793,244.60 26,226.90 7.1000 118 03/01/08
252 Jacksonville FL 32211 3,790,289.55 25,948.48 7.2600 117 02/01/08
253 Augusta GA 30901 3,788,034.64 25,922.70 7.2500 116 01/01/08
254 Norfolk NE 68701 3,787,735.69 25,601.30 7.1250 116 01/01/08
255 Salem VA 24523 3,785,732.36 29,006.90 6.8000 238 03/01/18
256 Eustis FL 32726 3,781,369.71 29,851.29 7.0300 232 09/01/17
257 Rockford IL 61108 3,750,108.50 25,243.05 7.0900 117 02/01/08
258 Lynnwood WA 98037 3,746,037.63 28,868.62 7.9700 119 04/01/08
259 Corbin KY 40701 3,688,584.07 25,499.53 7.3530 116 01/01/08
260 Bethesda MD 28014 3,636,395.34 26,641.67 7.3600 117 02/01/08
261 Orangeburg SC 29115 3,614,562.16 26,554.05 7.2600 228 05/01/17
262 Roswell GA 30075 3,614,244.75 25,470.75 7.5500 116 01/01/08
263 Englewood CO 80112 3,597,169.25 24,460.75 7.2100 239 04/01/18
264 Various FL Various 3,594,923.24 24,217.43 7.1100 118 03/01/08
264a Delray Beach FL 33445
264b Riviera Beach FL 33404
264c Delray Beach FL 33445
265 Annapolis MD 21401 3,594,810.39 23,999.26 7.0200 118 03/01/08
266 Gainesville GA 30504 3,591,540.48 26,206.88 7.3300 298 03/01/23
267 Grand Prairie TX 75052 3,591,189.64 24,081.59 7.0540 117 02/01/08
268 Victoria TX 77901 3,591,078.89 25,023.98 7.4400 117 02/01/08
269 Miami FL 33056 3,591,048.41 24,974.81 7.4200 117 02/01/08
270 Clear Lake City TX 77058 3,577,012.99 23,601.84 6.9100 119 04/01/08
271 Ft. Lauderdale FL 33309 3,547,375.75 24,870.75 7.5200 119 04/01/08
272 Portland OR 97223 3,547,372.24 24,853.72 7.5130 119 04/01/08
273 Mesa AZ 85204 3,496,073.89 26,092.78 7.6000 83 04/01/05
274 San Jose CA 95123 3,492,968.16 26,264.41 7.6750 118 03/01/08
275 Metairie LA 70001 3,477,096.43 22,942.57 6.9100 119 04/01/08
276 Sioux Falls SD 57105 3,475,000.00 24,131.36 7.4300 120 05/01/08
277 Snohomish WA 98290 3,446,354.62 26,559.13 7.9700 119 04/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
225 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
226 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
227 358 N 0.0900 0.0050 N - Act/360 Bank of America
228 299 N 0.0900 0.0050 N - Act/360 First Union
229 N 0.0900 0.0050 N - 30/360 Bank of America
230 282 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
231 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
232 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
233 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
234 358 N 0.0900 0.0050 N - Act/360 Bank of America
235 N 0.1400 0.0050 N - Act/360 Lehman Brothers
236 N 0.1400 0.0050 N - 30/360 Lehman Brothers
237 354 N 0.0900 0.0050 N - Act/360 Bank of America
238 359 N 0.0900 0.0050 N - Act/360 First Union
239 300 N 0.0900 0.0050 N - Act/360 First Union
240 359 N 0.0900 0.0050 N - Act/360 First Union
241 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
242 356 N 0.0900 0.0050 N - Act/360 Bank of America
243 N 0.1500 0.0050 Y 2.0000 30/360 Lehman Brothers
244 N 0.1150 0.0050 N - Act/360 First Union
245 353 N 0.0900 0.0050 N - Act/360 Lehman Brothers
246 297 N 0.0900 0.0050 N - Act/360 First Union
247 356 N 0.0900 0.0050 N - Act/360 First Union
248 296 N 0.0900 0.0050 N - Act/360 Bank of America
249 355 N 0.0900 0.0050 N - Act/360 Bank of America
250 336 N 0.0900 0.0050 N - Act/360 First Union
251 328 N 0.1150 0.0050 N - Act/360 First Union
252 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
253 356 N 0.0900 0.0050 N - 30/360 Lehman Brothers
254 356 N 0.0900 0.0050 N - Act/360 First Union
255 N 0.0900 0.0050 N - Act/360 First Union
256 N 0.0900 0.0050 N - 30/360 First Union Y
257 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
258 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
259 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
260 297 N 0.0900 0.0050 N - Act/360 Lehman Brothers
261 288 N 0.0900 0.0050 N - 30/360 First Union Y
262 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
263 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
264 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
264a N
264b N
264c N
265 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
266 N 0.1400 0.0050 N - 30/360 Lehman Brothers
267 357 N 0.0900 0.0050 N - 30/360 Bank of America
268 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
269 357 N 0.1700 0.0050 N - Act/360 Lehman Brothers
270 359 N 0.0900 0.0050 N - Act/360 First Union
271 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
272 359 N 0.0900 0.0050 N - Act/360 Bank of America
273 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
274 298 N 0.0900 0.0050 N - Act/360 Bank of America
275 359 N 0.0900 0.0050 N - Act/360 First Union
276 360 N 0.1400 0.0050 N - Act/360 Lehman Brothers
277 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
225 1.32 74.5 No Y Y
226 1.53 74.6 No Y Y
227 1.42 74.8 No Y Y
228 1.40 75.9 Inn of
Pays Y Y
229 1.24 73.6 No Y N
230 Walgreen Company Y Y 1.02 94.7 No Y N
231 1.30 73.5 No Y Y
232 1.20 76.6 No N N
233 1.38 73.4 No Y Y
234 2.06 46.8 No Y Y
235 1.26 74.4 No Y Y
236 1.31 69.2 No Y N
237 1.31 70.8 No Y Y
238 1.26 79.9 No Y Y
239 1.57 63.5 No Y Y
240 1.26 66.6 No Y Y
241 1.31 79.8 No Y Y
242 1.54 70.9 No Y Y
243 1.36 79.0 No Y N
244 1.32 74.7 No N Y
245 1.33 76.4 No Y N
246 1.35 56.1 No Y Y
247 1.32 69.2 No N Y
248 1.60 58.5 No Y Y
249 1.26 79.9 No Y Y
250 1.46 58.0 No Y Y
251 1.28 71.6 No Y Y
252 1.40 73.6 No Y Y
253 1.41 74.3 No Y N
254 1.57 80.6 No Y Y
255 1.65 64.6 No Y Y
256 Winn-Dixie Stores, Inc. 1.03 86.4 No Y N
257 1.23 79.8 No Y Y
258 2.29 47.4 No Y N
259 1.46 75.3 LB-B Y Y
260 1.58 66.1 No Y Y
261 Winn-Dixie Stores, Inc. Y Y 1.03 95.1 No Y N
262 1.31 65.9 No Y Y
263 1.26 74.9 No N Y
264 1.31 74.1 No Y Y
264a 0.00 0.0
264b 0.00 0.0
264c 0.00 0.0
265 1.34 78.2 No Y Y
266 1.25 74.8 No Y N
267 1.53 75.8 No Y N
268 1.26 79.8 No Y Y
269 1.66 71.8 No Y Y
270 1.35 79.9 No Y Y
271 1.35 74.7 No N Y
272 1.29 71.0 No Y Y
273 2.00 30.9 No N Y
274 1.60 53.7 No Y N
275 1.35 79.9 No Y Y
276 1.25 77.2 No N Y
277 2.23 51.6 No Y N
</TABLE>
B-6
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
278 Grand Manor Nursing and Rehab Center 3645 Cook Avenue
279 Terrace View Apartments 525 Vaughn Avenue
280 Hillsdale Manor 4710-4738 Wakefield Road
281 Amerihost Inn- Players 203 Front Street
282 Walgreens (Las Vegas) 9420 Lake Mead Boulevard
283 Metro Plaza 1407-1411 East-West Hgwy & 8397-8399 Colesville Rd
284 Fidelity Federal Bank Building 6350 Laurel Canyon Boulevard
285 White Mountain Village 20 East White Mountain Boulevard
286 Forestwood On the Creek Apts. 9601 Forest Lane
287 Shepherdsville Square Kentucky Highway 44
288 Westbrook 3463-3560 53rd Ave
289 100 Broadway 64, 100 & 102 Broadway
290 Staples Hazelton 180 Susquehanna Boulevard
291 Treetops Terace Condominiums 93-116 Tree Top Court
292 Estero Woods Village 22770 South Tamiami Trail
293 Green Center (MCG) East Gude Drive and Taft Street
294 Warehouse Specialists - Fond Du Lac II 170 W. Larsen Drive
295 Walgreens Pharmacy (Chicago Heights) SWC of Western Avenue and Lincoln Highway
296 Everett I-5 Mini-Storage 13026 4th Avenue West
297 Buck Run/Timberline Condominiums 4689 Buck Run Square
298 Marketplace Shopping Center (Williamsburg-Loan Level) Various
298a Rivergate Business Center (Williamsburg-Prop Level) 309 McLaws Circle
298b Marketplace Shopping Center (Williamsburg-Prop Level) 240 McLaws Circle
299 Mooresmill Village 2453 Coronet Way, NE
300 The Pontiac Building 542 South Dearborn
301 Best Buy Retail Bldg. 6900 South Westnedge Avenue
302 Sussex Downs Apartments 1125 Magnoilia Drive
303 Foothills Villas Apartments 2601-2675 West Second Street
304 Lincoln Arms Apartments 190 C Street
305 2-32 Brighton & 1101-1113 Commonwealth 2-32 Brighton & 1101-1113 Commonwealth
306 Manchester Square Kentucky Highway 8 at U.S. Highway 421
307 Northgate Villas Apartments 2305 Carville Drive
308 South Brook 5101 Linbar Drive
309 The Promenade Apartments 2330-2332 West Glenrosa Avenue
310 Swall Towers East 310 S. Swall Drive
311 Pinnacle 7131 Pinnacle Drive
312 Hillside Village Plaza 50 Route 111
313 Access Self Storage of Wayne 575 Route 23
314 Kaiser Permanente Health Center 65 Kane Street
315 Winn Dixie Morganton 111 Independence Boulevard
316 Swall Towers West 311 S. Swall Drive
317 Wind & Sea Shopping Center 4140-4150 Capitola Road
318 Grandview 1319 E. 45th Street
319 Salt Lake Medical Plaza Office Building 24 South 1100 East
320 Pep Boys Union 2525 U.S. Highway 22
321 9031 Snowden Square Drive 9031 Snowden Square Drive
322 Carriage Hills Apartments 114-116 Surrey Circle
323 Village on the Pike Shopping Center 2940 Covington Pike
325 San Leandro Furniture Center 2756 Alvarado Boulevard
326 General Cinema 4016 East 82nd Street
327 Westlake Commerce Center 31121-31131 Via Colinas
328 Valencia Gardens Apartments 2704 to 2734 Juniper Avenue
329 Barnes & Noble 12170 Jefferson Avenue
330 Mcghan Medical Buildings 5511, 5531, 5551, & 5571 Ekwill Street
331 Woodmere Apartments 2135 West County Line Road
332 Safeway Milton Freewater 455 North Columbia St.
333 Rite Aid Portage Westnedge Avenue and Kilgore Road
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
278 St Louis MO 63113 3,435,045.19 26,342.61 7.8750 176 01/01/13
279 Toms River NJ 08753 3,431,073.27 23,280.49 7.1700 177 02/01/13
280 Baltimore MD 21207 3,426,847.77 23,339.63 7.2100 117 02/01/08
281 Metroplois IL 62960 3,419,679.83 28,057.25 7.6250 235 12/01/17
282 Las Vegas NV 89134 3,396,544.93 27,051.35 7.2000 234 11/01/17
283 Silver Spring MD 20910 3,394,966.40 22,415.15 6.9100 178 03/01/13
284 North Hollywood CA 91606 3,392,923.73 25,103.59 7.4900 118 03/01/08
285 Pinetop-Lakeside AZ 85935 3,390,568.02 22,120.18 6.7800 117 02/01/08
286 Dallas TX 75243 3,389,912.30 23,889.81 7.5500 116 01/01/08
287 Shepardsville KY 41065 3,389,509.68 23,432.00 7.3530 116 01/01/08
288 Columbus NE 68601 3,385,039.59 22,879.48 7.1250 116 01/01/08
289 Menands NY 12204 3,380,435.75 27,099.85 7.3600 117 02/01/08
290 West Hazelton PA 18201 3,361,990.84 27,437.69 7.6000 237 02/01/18
291 Blommingdale NJ 07403 3,350,000.00 22,852.91 7.2500 180 05/01/13
292 Estero FL 33928 3,349,272.58 22,761.81 7.1800 80 01/01/05
293 Rockville MD 20850 3,343,708.47 26,335.70 7.1800 119 04/01/08
294 Fond Du Lac WI 54935 3,330,287.28 30,936.05 7.4375 178 03/01/13
295 Chicago Heights IL 60630 3,297,412.39 24,512.00 7.4300 236 01/01/18
296 Everett WA 98204 3,295,515.58 22,534.20 7.2600 118 03/01/08
297 Roanoke VA 24014 3,295,363.42 22,232.71 7.1250 118 03/01/08
298 Williamsburg VA 23185 3,291,905.50 23,074.08 7.5000 117 02/01/08
298a Williamsburg VA 23185
298b Williamsburg VA 23185
299 Atlanta GA 30318 3,291,194.91 27,834.85 9.0625 297 02/01/23
300 Chicago IL 60605 3,289,824.29 22,749.56 7.3560 116 01/01/08
301 Portage MI 49002 3,287,692.89 24,078.45 7.3560 117 02/01/08
302 Franklin TN 37064 3,266,130.06 21,612.98 6.9200 117 02/01/08
303 San Bernadino CA 92410 3,264,848.02 27,132.04 7.7700 234 11/01/17
304 Sparks NV 89431 3,252,040.67 22,054.99 7.1590 116 01/01/08
305 Boston MA 02215 3,246,220.37 23,753.59 7.3750 119 04/01/08
306 Manchester KY 40165 3,239,972.50 22,398.23 7.3530 116 01/01/08
307 Reno NV 89512 3,231,170.58 21,303.98 6.8840 117 02/01/08
308 Nashville TN 37211 3,213,139.91 22,175.45 7.3300 175 12/01/12
309 Phoenix AZ 85015 3,208,099.19 22,090.70 7.3070 115 12/01/07
310 Los Angeles CA 90048 3,197,448.60 21,591.40 7.1400 119 04/01/08
311 Ft. Myers FL 33907 3,191,724.41 21,699.56 7.1900 117 02/01/08
312 Smithtown NY 11787 3,191,710.26 21,677.91 7.1800 117 02/01/08
313 Wayne Township NJ 07470 3,188,308.05 23,647.72 7.5000 117 02/01/08
314 West Hartford CT 06119 3,184,959.64 22,704.46 7.6500 113 10/01/07
315 Morganton NC 28655 3,154,360.17 24,999.29 7.0000 229 06/01/17
316 Los Angeles CA 90048 3,147,488.47 21,254.03 7.1400 119 04/01/08
317 Capitola CA 95010 3,146,055.81 22,206.73 7.5840 118 03/01/08
318 Kearny NE 68847 3,143,820.62 21,249.08 7.1250 116 01/01/08
319 Salt Lake City UT 84102 3,134,338.76 22,379.95 7.0700 117 02/01/08
320 Union Township NJ 07083 3,124,248.80 22,684.52 7.4100 234 11/01/17
321 Columbia MD 21045 3,117,577.56 26,103.34 7.8750 234 11/01/17
322 Chamblee GA 30341 3,113,343.36 26,667.99 8.1200 51 08/01/02
323 Memphis TN 38134 3,097,528.33 20,916.67 7.1400 119 04/01/08
325 San Leandro CA 94577 3,093,291.66 22,472.96 7.2830 118 03/01/08
326 Indianapolis IN 46250 3,090,238.46 21,147.46 7.2500 176 01/01/13
327 Westlake Village CA 91362 3,086,819.64 21,809.54 7.5630 114 11/01/07
328 Boulder CO 80301 3,071,470.37 20,058.78 6.7900 117 02/01/08
329 Newport News VA 23602 3,058,550.65 22,400.26 7.3560 117 02/01/08
330 Goleta CA 93111 3,033,799.44 20,935.68 7.3290 115 12/01/07
331 Jackson NJ 08527 3,032,111.26 20,573.46 7.1700 177 02/01/13
332 Milton Freewater OR 98762 3,022,231.31 23,478.58 7.2500 231 08/01/17
333 Portage MI 49081 3,010,493.00 22,542.69 7.1250 236 01/01/18
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
278 296 N 0.0900 0.0050 N - Act/360 First Union
279 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
280 357 N 0.0900 0.0050 N - 30/360 First Union
281 N 0.0900 0.0050 N - Act/360 First Union
282 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
283 358 N 0.0900 0.0050 N - Act/360 First Union
284 298 N 0.1400 0.0050 N - Act/360 Lehman Brothers
285 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
286 356 N 0.0900 0.0050 N - Act/360 First Union
287 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
288 356 N 0.0900 0.0050 N - Act/360 First Union
289 237 N 0.1400 0.0050 N - Act/360 Lehman Brothers
290 N 0.0900 0.0050 N - 30/360 First Union Y
291 360 N 0.0900 0.0050 N - Act/360 First Union
292 356 N 0.0900 0.0050 N - Act/360 First Union
293 239 N 0.1400 0.0050 N - Act/360 Lehman Brothers
294 N 0.0900 0.0050 N - Act/360 First Union
295 290 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
296 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
297 358 N 0.0900 0.0050 N - Act/360 First Union
298 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
298a N
298b N
299 N 0.0900 0.0050 N - 30/360 First Union
300 356 N 0.0900 0.0050 N - Act/360 Bank of America
301 297 N 0.0900 0.0050 N - Act/360 Bank of America
302 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
303 N 0.0900 0.0050 N - 30/360 Lehman Brothers
304 356 N 0.0900 0.0050 N - Act/360 Bank of America
305 299 N 0.0900 0.0050 N - Act/360 First Union
306 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
307 357 N 0.0900 0.0050 N - Act/360 Bank of America
308 355 N 0.0900 0.0050 N - Act/360 First Union
309 355 N 0.0900 0.0050 N - Act/360 Bank of America
310 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
311 357 N 0.0900 0.0050 N - Act/360 First Union
312 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
313 297 N 0.0900 0.0050 N - Act/360 First Union
314 353 N 0.0900 0.0050 N - Act/360 Lehman Brothers
315 N 0.0900 0.0050 N - 30/360 First Union Y
316 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
317 358 N 0.0900 0.0050 N - Act/360 Bank of America
318 356 N 0.0900 0.0050 N - Act/360 First Union
319 297 Y 0.1400 0.0050 N - Act/360 Lehman Brothers
320 N 0.0900 0.0050 N - 30/360 First Union Y
321 N 0.0900 0.0050 N - Act/360 First Union
322 231 N 0.0900 0.0050 N - Act/360 Lehman Brothers
323 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
325 298 N 0.0900 0.0050 N - Act/360 Bank of America
326 N 0.0950 0.0050 Y 2.0000 Act/360 Lehman Brothers
327 354 N 0.0900 0.0050 N - Act/360 Bank of America
328 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
329 297 N 0.0900 0.0050 N - Act/360 Bank of America
330 355 N 0.0900 0.0050 N - Act/360 Bank of America
331 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
332 N 0.0900 0.0050 N - 30/360 First Union Y
333 266 N 0.0900 0.0050 N - 30/360 First Union Y
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
278 1.98 74.7 No Y N
279 1.24 79.8 No Y Y
280 1.25 74.8 No N N
281 1.40 68.4 No Y N
282 Walgreen Company 1.29 69.0 No Y N
283 1.50 73.6 No Y Y
284 1.31 72.2 No N Y
285 1.39 73.7 No N Y
286 1.27 70.6 No Y Y
287 1.56 73.3 LB-C Y Y
288 1.47 80.6 No Y Y
289 1.36 67.6 No Y Y
290 Staples 1.00 96.1 No N N
291 1.29 79.8 No Y Y
292 1.40 79.7 No N Y
293 1.28 69.7 No Y Y
294 1.35 62.8 WSI II Y Y
295 Walgreen Company Y Y 1.02 94.2 No Y N
296 1.53 64.6 No Y Y
297 1.30 76.6 No Y Y
298 1.32 74.1 No Y Y
298a 1.32 77.8
298b 1.32 69.6
299 1.20 75.3 No N N
300 1.69 70.0 No Y Y
301 1.36 73.1 No Y Y
302 1.27 79.7 No Y Y
303 1.29 65.3 No N N
304 1.56 74.8 No Y Y
305 1.30 61.3 No Y Y
306 1.81 66.8 LB-B Y Y
307 1.39 74.8 No Y Y
308 1.79 49.4 No N Y
309 1.44 79.7 No Y Y
310 1.29 79.9 No Y Y
311 1.40 79.1 No N Y
312 1.30 72.5 No Y Y
313 1.82 65.1 No Y Y
314 1.28 75.8 No Y N
315 Winn-Dixie Stores, Inc. 1.04 90.1 No Y N
316 1.28 76.3 No Y Y
317 1.30 74.9 No Y Y
318 1.44 80.6 No Y Y
319 1.48 63.6 No Y Y
320 Pep Boys 1.04 99.5 No N N
321 1.28 69.3 No N N
322 1.56 77.8 No Y N
323 1.39 73.8 No Y Y
325 1.42 60.0 No Y Y
326 1.29 79.2 No Y Y
327 1.49 70.2 No Y Y
328 1.29 79.8 No N Y
329 1.29 74.6 No Y Y
330 1.64 74.0 No Y Y
331 1.30 79.8 No Y Y
332 Safeway 1.05 94.4 No Y N
333 Rite Aid Corp. Y Y 1.00 97.1 No Y N
</TABLE>
B-7
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
334 Rain Forest Apartments 17714 Red Oak Drive
335 Nexstar Pharmaceuticals Building 2860 Wilderness Place
336 Meadowrock Apartments 1598 Becky Court
337 544 Lawrence Expressway 540-548 Lawrence Expressway
338 Courtyard At Scottsdale North 9160 East Shea Boulevard
339 Mountain Vista Apartments 4400 E Busby Drive
340 Walgreen St John 9280 Wicker Avenue
341 Timberfalls Apartments 2600 East 113th Ave.
342 Chancellor Care Center of Delmar 101 E. Delaware Avenue
343 118 South Clinton Street 118 S Clinton Street
344 University Village Shopping Center 2441,2529-2539 University Boulevard
345 Walgreen Lafayette SEC 18TH Street and State Road 26
346 Northfield Lodge 603 East Northfield Boulevard
347 Greenbrier Valley Mall U.S. Route 219
348 Somserset Chambers 156-158 Summer Street
349 Village Plaza of Margate 1360-1456 N. State Rd. 7
350 Bentley Avenue Apartments 1633 South Bentley Avenue
351 Pheasant Glen 447 West Clinton Avenue
352 Maple Plaza Shopping Center 1102-1198 E. West Maple Road
354 Old Country Plaza 3940 Plank Road Road
355 West Court Office Building 2448 Holly Avenue
356 Walgreen Miami 9675 Northwest 41st Street
357 Paradise Shopping Plaza NEQ of 40th Street and Thunderbird Road
358 Century Analysis, Inc., Building 60 Berry Drive
359 Americana Apartments 3701 East Chapman Avenue
360 Warehouse Specialists - Stevens Point I & II 4400 Industrial Park Rd. & 2557 Leahy Court
361 Dolly Creek Shopping Center 2409 Acton Road
362 Littleton Lyne 119-125 Littleton Road
363 Raintree Apartments 7601 North 9th Avenue
364 Auburn Blvd Mini Storage 6230 Auburn Blvd
365 Springs Office Building 2101 West State Road 434
366 Covington Club Apartments 1308 W. Covington Court
367 Park East Apartments 1845 Summit Place, N.W.
368 Shadow Trail Apartments 15520 Foothill Boulevard
369 Inn at Saratoga 20645 Fourth Street
370 Regency Park Apartments 2973 West Swain Road
371 Marketplace at Ken Caryl 10143 West Chatfield Avenue
372 Three West Carillo Building 931-939 State Street
373 Linda Granada 16600 San Fernanado Mission
374 633 Building 633 Germantown Pike
375 Shoreline View Alzheimer Care Center 9324 North Harborview Drive
376 Tudor Gardens Apartments 15128-15144 Burbank Blvd
377 Cobblestone Village 1237-1263 North Riverside Av.
378 K-Mart Plaza Shopping Center (Galveston) 6105-6327 Stewart Road
379 303 Winding Road 303 Winding Road
381 Amerihost Inn - Hammond 7813 Indianapolis Boulevard
382 Holiday Inn Express - Albany, GA 911 East Oglethorpe Blvd.
383 Hillside Apartments 501 Eric Avenue
384 Walgreen Store (Wolfcreek) SEC of Germantown Parkway & U.S. Highway 64
385 Southgate Village Life Care Center 4101 SW Martin Drive
386 Walgreen Houston 10850 Scarsdale Boulevard
387 Kushner Seiden Madison 64th LP 26 East 64th Street
388 Miramar/Chapparone Auto Center 6590-6598 Miramar Road
389 Stor-It Rental Storage 1435 Malad Street
390 Jefferson Centre 105 East Jefferson Boulevard
391 Best Western - Dunn 603 Spring Branch Road
392 Ocean Villa Townhomes #2 4400-4600 Dallas Drive
393 Central Park Professional Center 1450 Madruga Avenue
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
334 Houston TX 77090 2,997,655.06 20,444.95 7.2400 119 04/01/08
335 Boulder CO 80301 2,997,612.80 20,262.20 7.1500 119 04/01/08
336 Santa Rosa CA 95403 2,997,495.94 19,774.06 6.9080 119 04/01/08
337 Sunnyvale CA 95086 2,996,584.65 22,185.35 7.5080 119 04/01/08
338 Scottsdale AZ 85257 2,989,267.88 20,888.17 7.4570 115 12/01/07
339 Sierra Vista AZ 85635 2,988,062.61 20,383.96 7.2100 115 12/01/07
340 St. John IN 46373 2,960,504.00 23,177.84 7.0000 235 12/01/17
341 Tampa FL 33612 2,955,617.80 19,514.37 6.9100 118 03/01/08
342 Delmar DE 19940 2,944,904.07 22,845.76 8.0000 115 12/01/07
343 Chicago IL 60661 2,940,903.52 20,336.73 7.3560 116 01/01/08
344 Houston TX 77005 2,936,468.90 23,757.60 9.0100 170 07/01/12
345 Lafayette IN 47905 2,922,389.00 22,526.56 6.8750 238 03/01/18
346 Murfreesboro TN 37130 2,897,305.71 19,995.72 7.3300 175 12/01/12
347 Fairlea WV 24901 2,891,052.37 19,986.12 7.3530 116 01/01/08
348 Summerville MA 02143 2,876,550.45 20,705.64 7.1900 299 04/01/23
349 Margate FL 33063 2,843,054.28 24,758.22 7.5000 203 04/01/15
350 Los Angeles CA 90025 2,836,527.64 20,172.12 7.6250 113 10/01/07
351 State College PA 16803 2,815,365.88 22,099.99 8.7000 296 01/01/23
352 Walled Lake MI 48390 2,792,929.95 19,253.10 7.3300 117 02/01/08
354 Fredericksburg VA 22407 2,778,954.47 22,130.53 7.2500 236 01/01/18
355 Annapolis MD 21401 2,745,987.29 18,240.45 6.9700 118 03/01/08
356 Miami FL 33178 2,718,069.24 22,627.10 7.5000 223 12/01/16
357 Phoenix AZ 85032 2,697,988.17 18,841.83 7.4800 119 04/01/08
358 Pacheco CA 94553 2,696,563.47 18,915.78 7.5200 118 03/01/08
359 Orange CA 92869 2,688,048.26 18,648.23 7.3750 114 11/01/07
360 Stevens Point WI 54481 2,684,112.12 24,933.54 7.4375 178 03/01/13
361 Vestavia Hills AL 35243 2,672,871.41 18,067.13 7.1500 119 04/01/08
362 Ayer MA 01432 2,656,383.08 20,607.49 8.0000 115 12/01/07
363 Pensacola FL 32514 2,652,844.86 17,625.65 6.9600 81 02/01/05
364 Citrus Heights CA 95621 2,639,793.95 18,949.99 7.1300 117 02/01/08
365 Altomonta Springs/
Longwood FL 32714 2,639,786.71 18,941.49 7.1250 117 02/01/08
366 Peoria IL 61614 2,596,257.41 17,343.29 7.0260 118 03/01/08
367 Washington DC 20009 2,596,160.04 17,158.40 6.9200 118 03/01/08
368 Sylmar CA 91342 2,593,160.14 17,455.30 7.0900 117 02/01/08
369 Saratoga CA 95070 2,588,127.92 19,298.41 7.5500 116 01/01/08
370 Stockton CA 95207 2,587,545.22 18,299.01 7.5670 113 10/01/07
371 Littleton CO 80127 2,547,125.71 18,960.54 7.5700 119 04/01/08
372 Santa Barbara CA 93101 2,546,696.96 17,744.49 7.4510 118 03/01/08
373 Granda Hills CA 91344 2,542,686.75 18,215.68 7.7200 116 01/01/08
374 Plymouth Meeting PA 19401 2,540,682.96 18,844.28 7.5000 117 02/01/08
375 Gig Harbor WA 98332 2,538,946.43 19,470.63 7.8750 116 01/01/08
376 Los Angeles CA 91411 2,538,067.74 17,159.17 7.1130 114 11/01/07
377 Medford OR 97501 2,500,000.00 17,054.41 7.2500 120 05/01/08
378 Galveston TX 77551 2,494,392.42 17,813.27 7.0900 118 03/01/08
379 Bethpage NY 11804 2,491,811.51 16,716.60 7.0500 80 01/01/05
381 Hammond IN 46324 2,481,770.36 20,139.83 7.5000 236 01/01/18
382 Albany GA 31705 2,479,063.65 20,911.00 8.0000 235 12/01/17
383 Bowling Green KY 42101 2,472,995.16 16,566.09 7.0600 119 04/01/08
384 Memphis TN 38133 2,467,814.73 20,287.76 7.5000 230 07/01/17
385 Topeka KS 66612 2,464,054.16 18,694.39 7.7500 116 01/01/08
386 Houston TX 77089 2,459,764.86 19,656.00 7.2700 235 12/01/17
387 New York NY 10021 2,453,681.46 16,748.18 7.2300 357 02/01/28
388 San Diego CA 92121 2,448,027.16 16,448.26 7.0900 119 04/01/08
389 Boise ID 83705 2,447,179.29 18,783.43 7.8750 175 12/01/12
390 South Bend IN 46601 2,446,687.19 16,763.20 7.2800 118 03/01/08
391 Dunn NC 28334 2,416,635.89 24,305.97 8.6250 175 12/01/12
392 Oxnard CA 93033 2,396,690.52 16,292.54 7.2010 118 03/01/08
393 Coral Gables FL 33146 2,396,615.50 16,144.95 7.1100 118 03/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
334 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
335 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
336 359 N 0.0900 0.0050 N - Act/360 Bank of America
337 299 N 0.0900 0.0050 N - Act/360 Bank of America
338 355 N 0.0900 0.0050 N - Act/360 Bank of America
339 355 N 0.0900 0.0050 N - 30/360 Bank of America
340 N 0.0900 0.0050 N - 30/360 First Union Y
341 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
342 295 N 0.0900 0.0050 N - Act/360 First Union
343 356 N 0.0900 0.0050 N - Act/360 Bank of America
344 350 N 0.1650 0.0050 N - Act/360 Lehman Brothers
345 N 0.0900 0.0050 N - 30/360 First Union Y
346 355 N 0.0900 0.0050 N - Act/360 First Union
347 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
348 N 0.0900 0.0050 N - 30/360 First Union
349 N 0.0900 0.0050 N - Act/360 First Union
350 353 N 0.0900 0.0050 N - Act/360 Bank of America
351 356 N 0.0900 0.0050 N - Act/360 First Union
352 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
354 N 0.0900 0.0050 N - Act/360 First Union
355 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
356 N 0.0900 0.0050 N - 30/360 First Union Y
357 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
358 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
359 354 N 0.0900 0.0050 N - Act/360 Bank of America
360 N 0.0900 0.0050 N - Act/360 First Union
361 359 N 0.1100 0.0050 N - Act/360 Lehman Brothers
362 295 N 0.0900 0.0050 N - Act/360 First Union
363 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
364 297 N 0.0900 0.0050 N - Act/360 First Union
365 297 Y 0.0900 0.0050 N - Act/360 First Union
366 358 N 0.0900 0.0050 N - Act/360 Bank of America
367 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
368 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
369 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
370 353 N 0.0900 0.0050 N - Act/360 Bank of America
371 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
372 358 N 0.0900 0.0050 N - Act/360 Bank of America
373 356 N 0.0900 0.0050 N - Act/360 First Union
374 297 N 0.0900 0.0050 N - Act/360 First Union
375 296 N 0.0900 0.0050 N - Act/360 First Union
376 354 N 0.0900 0.0050 N - Act/360 Bank of America
377 360 N 0.0900 0.0050 N - Act/360 First Union
378 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
379 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
381 N 0.0900 0.0050 N - Act/360 First Union
382 N 0.0900 0.0050 N - Act/360 First Union
383 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
384 N 0.1500 0.0050 N - Act/360 Lehman Brothers
385 296 N 0.1150 0.0050 N - Act/360 First Union
386 N 0.0900 0.0050 N - 30/360 First Union Y
387 N 0.0900 0.0050 N - Act/360 First Union
388 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
389 295 N 0.0900 0.0050 N - Act/360 First Union
390 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
391 Y 0.0900 0.0050 N - Act/360 First Union
392 358 N 0.0900 0.0050 N - Act/360 Bank of America
393 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
334 1.31 76.5 No Y Y
335 1.32 71.4 No N Y
336 1.41 68.1 No Y Y
337 1.50 66.6 No Y Y
338 1.79 59.8 No Y Y
339 1.30 74.7 No Y N
340 Walgreen Company 1.00 93.2 No Y N
341 1.41 79.9 No N Y
342 1.45 68.5 No Y N
343 1.74 73.5 No Y Y
344 1.29 69.9 No N N
345 Walgreen Company 1.08 87.5 No Y N
346 1.30 66.6 No N Y
347 1.30 70.5 LB-C Y Y
348 1.26 79.9 No N N
349 1.26 71.1 No Y Y
350 1.21 70.9 No Y N
351 1.18 84.8 No Y N
352 1.38 57.0 No Y Y
354 1.36 70.4 No Y Y
355 1.29 78.5 No Y Y
356 Walgreen Company 1.10 77.1 No N N
357 1.39 74.7 No Y Y
358 1.27 74.9 No Y Y
359 1.40 74.7 No Y Y
360 1.34 59.7 WSI Y Y
361 1.38 77.5 No Y Y
362 1.26 78.1 No N N
363 1.54 69.8 No Y Y
364 1.38 73.8 No Y Y
365 1.30 68.8 No N Y
366 1.42 79.3 No Y Y
367 1.30 79.6 No Y Y
368 1.32 78.6 No Y Y
369 3.53 39.8 No Y Y
370 1.28 78.7 No Y Y
371 1.31 74.7 No Y Y
372 1.27 67.0 No Y Y
373 1.31 77.3 No N N
374 1.30 68.7 No Y Y
375 1.37 74.7 No Y N
376 1.44 74.7 No Y Y
377 1.25 72.5 No Y Y
378 1.31 65.6 No Y Y
379 1.25 62.3 No Y Y
381 1.42 62.8 No Y Y
382 1.51 66.1 No Y N
383 1.33 79.8 No Y Y
384 1.19 83.1 LB-H Y Y
385 1.61 74.7 No Y N
386 Walgreen Company 1.03 87.1 No N N
387 1.45 74.4 No Y Y
388 1.45 74.2 No N Y
389 1.36 74.2 No Y N
390 1.57 74.1 No Y Y
391 1.88 69.1 No Y N
392 1.42 80.2 No Y Y
393 1.26 68.5 No Y Y
</TABLE>
B-8
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
394 Safeguard Self Storage 1007-09 Edgewood Road
395 Tuscany Village Phase I 235 Ocala
396 Concord Village West 137-A West Concord Drive
397 Peoria Town Center 8110-8140 Peoria Avenue
398 Days Inn - Forest Park 5116 Highway 85
399 Tech Center 300 Kimberton Road
400 Amerihost Inn - Parkersburg 401 37th Street
401 Comfort Inn - Gaffney, SC 143 Corona Drive
402 Food Pavilion 1000 West 4th Avenue
403 Eckerd Drug Store (Lexington) NWC of Columbia Avenue and Old Chapin Road
404 Keep It Self Storage - Santa Clarita 25333 San Fernando Road
405 Country Creek 398 Bethel Avenue
406 1803 Park Center Drive 1803 Park Center Drive
407 Willow Trace Apartments 8100 Pines Road
408 Walgreen Coral Springs 5480 University Drive
409 Fox Crossing 6410 Walther Avenue
410 Emmorton Village Shopping Center 3101-05 Emmorton Road (Rt. 24)
411 Slauson Plaza 9402-9448 Slauson Avenue
412 Walgreen Chicago 1546 North Central Ave.
413 Warehouse Specialists - Specialists Ave # 1-4 720 - 772 Specialists Avenue
414 Wanamassa Gardens Apartments 1515 Allen Avenue
415 Inn of Payson 801 North Beeline Highway
416 River Oaks Apartments 3001 Medical Arts Street
417 Val Halla 1224 Lake Avenue
418 Timm Office Building 136 West Canon Perdido Street
419 Twin Fountains Apartments 2135 South Depew Street
420 Hillcroft Plaza Shopping Center 6401 Hillcroft
421 Plantation House 2625 Hudnell Street
422 Olde Towne Shopping Center 210-800 Olde Towne Road
423 5 Walk-Up Residential Buildings (Formerly 70 East) 70 East 3rd, 157,162 Stanton, 166,178 Norfolk
424 Comfort Inn - Franklin 4206 Franklin Commons Court
425 Days Inn (Winter Park) 901 North Orlando Avenue
426 Office Depot Aurora SEC East Mississippi Avenue & South Potomac Street
427 Tara Woods Apartments 661 Sherwood Drive
428 Sneaker Stadium Hurfville Road (Route 41)
429 Andora Apartments 3305 Linda Drive
430 1212-1216 Broadway 1212-1216 Broadway
431 3610 Birch Street (Apollo Office Building) 3610 Birch Street
432 Walgreens Pharmacy (Miami) 15900 Northwest 27th Avenue
433 Eckerd Ventnor 6701 Ventnor Avenue
434 Capitol Warehouse Building 4355 Duraform Lane
435 North Oaks Manor Apartments 600-616 North Oaks Drive
436 6100 Capital Center 6100 South Fashion Blvd
437 Rite Aid Virginia Beach 324 Virginia Beach Blvd
438 Rite Aid Roanoke 1168 Peters Creek Road
439 The Business Centre at Riverside 1362 Brass Mill Road
440 The Manors Apartments 985 Manor Drive
441 FAA Building 8808 Beck Road
442 Eckerd Houma 7015 West Park Avenue
443 Antelope Valley Mall 1201 W Avenue P
444 Chateau Imperial 3000-3320 Parklane Drive
445 Glenoaks Apartments 1019 East Glenoaks Blvd
446 Lucky/Sav-On Center 2006 Avenue K
447 Eckerd Winslow S.W. Willaimstown - New Freedom Road
448 Walgreens - Richmond 11119 Hull Street Road
449 Stoughton Plaza 397-423 Washington Street
450 PetsMart Inc. 2677 East Main Street
451 Cobblestone Village Shopping Center 2001-2099 East Orangethorpe Avenue
452 Villa d'Venus 3124 Lake Villa Drive
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
394 Edgewood MD 21040 2,394,644.70 16,814.03 7.5200 117 02/01/08
395 Tallahassee FL 32304 2,392,627.30 16,576.20 7.3750 116 01/01/08
396 Clarksvile TN 37042 2,391,173.89 16,502.66 7.3300 175 12/01/12
397 Peoria AZ 85354 2,388,976.76 17,193.89 7.7500 113 10/01/07
398 Forest Park GA 30050 2,382,514.19 20,710.39 8.8750 114 11/01/07
399 Phoenixville PA 19460 2,382,499.53 19,334.24 7.5000 116 01/01/08
400 Parkersburg WV 26101 2,378,907.69 19,518.09 7.6250 235 12/01/17
401 Gaffney SC 29341 2,360,068.62 19,907.27 8.0000 235 12/01/17
402 Kennewick WA 99336 2,343,111.70 15,743.34 7.0900 119 04/01/08
403 Lexington SC 29072 2,340,959.27 17,274.09 7.5700 232 09/01/17
404 Santa Clarita CA 91350 2,339,388.61 17,550.14 7.6200 236 01/01/18
405 Sanger CA 93757 2,326,171.64 16,721.06 7.7500 175 12/01/12
406 Orlando FL 32835 2,322,167.35 16,560.29 7.6900 118 03/01/08
407 Shreveport LA 71129 2,322,000.00 17,265.18 8.1400 110 07/01/07
408 Coral Springs FL 33076 2,320,085.38 18,521.79 7.1250 230 07/01/17
409 Baltimore MD 21206 2,319,272.57 15,499.53 7.0200 117 02/01/08
410 Abingdon MD 21009 2,291,829.34 16,698.72 7.3000 117 02/01/08
411 Pico Rivera CA 90660 2,280,921.21 16,318.43 7.7060 116 01/01/08
412 Chicago IL 60639 2,261,719.41 17,671.97 7.0000 236 01/01/18
413 Menasha WI 54956 2,261,613.00 21,008.81 7.4375 178 03/01/13
414 Wannamassa NJ 07712 2,254,135.36 15,294.74 7.1700 177 02/01/13
415 Payson AZ 85541 2,247,472.01 16,759.24 7.5900 239 04/01/18
416 Austin TX 78705 2,246,834.81 15,151.07 7.1200 118 03/01/08
417 Metairie LA 70002 2,222,177.00 14,796.33 7.0000 119 04/01/08
418 Santa Barbara CA 93101 2,222,028.77 15,299.34 7.3300 118 03/01/08
419 Denver CO 80227 2,216,216.51 14,802.98 7.0000 79 12/05/04
420 Houston TX 77081 2,205,232.78 16,045.30 7.3000 118 03/01/08
421 Dallas TX 75235 2,200,000.00 16,358.05 8.1400 110 07/01/07
422 Vestiva Hills AL 35216 2,197,192.71 15,397.79 7.5100 118 03/01/08
423 New York NY 10002 2,197,106.08 15,217.35 7.3900 118 03/01/08
424 Franklin TN 37064 2,196,876.93 17,560.57 7.8750 179 04/01/13
425 Winter Park FL 32789 2,195,718.51 16,747.44 7.8400 118 03/01/08
426 Aurora CO 80012 2,194,462.46 19,361.62 7.6250 173 10/01/12
427 Jonesboro GA 30236 2,194,360.59 15,241.76 6.7800 118 03/01/08
428 Deptford NJ 08096 2,193,031.27 14,963.14 7.2200 116 01/01/08
429 Dallas TX 75220 2,192,153.17 17,295.09 7.1800 238 03/01/18
430 New York NY 10001 2,189,021.81 17,162.53 8.1250 115 12/01/07
431 Newport Beach CA 92660 2,183,388.13 15,322.75 7.5300 119 04/01/08
432 Miami FL 33054 2,170,234.76 16,922.34 7.4500 230 07/01/17
433 Ventnor City NJ 08408 2,167,394.14 15,565.49 7.3100 233 10/01/17
434 Windsor WI 53598 2,156,227.94 22,952.35 7.5010 142 03/01/10
435 Osseo MN 55369 2,154,267.86 14,427.15 7.0390 117 02/01/08
436 Murray UT 84107 2,153,054.25 15,757.56 7.9390 115 12/01/07
437 Virginia Beach VA 23451 2,149,999.09 17,186.93 7.1700 231 08/01/17
438 Roanoke VA 24017 2,145,860.84 16,985.41 7.1700 236 01/01/18
439 Belcamp MD 21017 2,145,240.02 15,121.54 7.5600 117 02/01/08
440 Palm Springs FL 33461 2,142,586.73 15,217.57 7.6250 115 12/01/07
441 Van Buren Township MI 48111 2,141,611.88 23,552.00 7.0600 159 08/01/11
442 Houma LA 70364 2,126,984.61 15,030.92 7.0900 233 10/01/17
443 Palmdale CA 93551 2,125,000.00 16,744.03 7.2100 120 05/01/08
444 Hastings NE 68901 2,120,000.00 13,926.89 6.8750 120 05/01/08
445 Glendale CA 91206 2,112,568.12 14,282.49 7.1130 114 11/01/07
446 Lancaster CA 93536 2,106,979.91 14,339.19 7.1880 115 12/01/07
447 Winslow Township NJ 08095 2,106,916.60 15,577.28 7.6900 234 11/01/17
448 Richmond VA 23112 2,100,455.05 17,827.32 7.7700 223 12/01/16
449 Stoughton MA 02072 2,098,425.83 14,611.67 7.4500 119 04/01/08
450 Plainfield IN 46168 2,098,410.02 14,539.98 7.4000 119 04/01/08
451 Placentia CA 92670 2,098,381.24 14,411.26 7.3100 119 04/01/08
452 Metairie LA 70002 2,098,247.85 13,844.65 6.9100 119 04/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
394 357 N 0.0900 0.0050 N - 30/360 First Union
395 356 N 0.0900 0.0050 N - Act/360 First Union
396 355 N 0.0900 0.0050 N - Act/360 First Union
397 353 N 0.0900 0.0050 N - Act/360 Bank of America
398 258 N 0.0900 0.0050 N - Act/360 First Union
399 236 N 0.0900 0.0050 N - Act/360 First Union
400 N 0.0900 0.0050 N - Act/360 First Union
401 N 0.0900 0.0050 N - Act/360 First Union
402 359 N 0.0900 0.0050 N - Act/360 First Union
403 280 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
404 296 N 0.0900 0.0050 N - Act/360 First Union
405 355 N 0.0900 0.0050 N - Act/360 First Union
406 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
407 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
408 N 0.0900 0.0050 N - 30/360 First Union Y
409 357 N 0.0900 0.0050 N - 30/360 First Union
410 297 N 0.0900 0.0050 N - 30/360 First Union
411 356 N 0.0900 0.0050 N - Act/360 Bank of America
412 N 0.0900 0.0050 N - 30/360 First Union Y
413 N 0.0900 0.0050 N - Act/360 First Union
414 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
415 299 N 0.0900 0.0050 N - Act/360 First Union
416 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
417 359 N 0.0900 0.0050 N - Act/360 First Union
418 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
419 355 N 0.0900 0.0050 N - Act/360 Bank of America
420 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
421 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
422 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
423 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
424 263 N 0.0900 0.0050 N - Act/360 First Union
425 298 N 0.1400 0.0050 N - Act/360 Lehman Brothers
426 Y 0.0900 0.0050 N - 30/360 First Union Y
427 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
428 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
429 N 0.1400 0.0050 N - Act/360 Lehman Brothers
430 295 N 0.1150 0.0050 N - Act/360 First Union
431 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
432 257 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
433 N 0.0900 0.0050 N - 30/360 First Union Y
434 N 0.0900 0.0050 N - 30/360 Bank of America
435 357 N 0.0900 0.0050 N - Act/360 Bank of America
436 355 N 0.0900 0.0050 N - Act/360 Bank of America
437 N 0.0900 0.0050 N - 30/360 First Union Y
438 N 0.0900 0.0050 N - 30/360 First Union Y
439 357 N 0.0900 0.0050 N - 30/360 First Union
440 355 N 0.0900 0.0050 N - Act/360 First Union
441 Y 0.0900 0.0050 N - 30/360 Lehman Brothers
442 N 0.0900 0.0050 N - 30/360 First Union Y
443 240 N 0.0900 0.0050 N - Act/360 First Union
444 360 N 0.0900 0.0050 N - Act/360 First Union
445 354 N 0.0900 0.0050 N - Act/360 Bank of America
446 355 N 0.0900 0.0050 N - Act/360 Bank of America
447 N 0.0900 0.0050 N - 30/360 First Union Y
448 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
449 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
450 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
451 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
452 359 N 0.0900 0.0050 N - Act/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
394 1.36 71.5 No N N
395 1.41 77.2 No Y Y
396 1.41 67.4 No N Y
397 1.54 74.7 No Y N
398 1.41 62.7 No Y N
399 1.32 70.1 No Y Y
400 1.42 56.6 No Y N
401 1.41 69.4 No Y N
402 1.42 75.0 No Y Y
403 JC Penney Y Y 1.07 97.5 No Y N
404 1.35 74.3 No Y N
405 1.25 68.2 No N N
406 1.38 74.9 No Y N
407 1.27 63.6 No N N
408 Walgreen Company 1.05 83.6 No Y N
409 1.33 74.8 No N N
410 1.31 71.6 No N N
411 1.49 74.8 No Y N
412 Walgreen Company 1.57 58.8 No Y N
413 2.23 38.7 No Y Y
414 1.20 77.7 No Y Y
415 1.40 48.3 Inn of
Pays Y Y
416 1.43 73.7 No Y Y
417 1.44 79.9 No Y Y
418 1.32 74.1 No N Y
419 1.66 67.0 No Y Y
420 1.48 71.1 No Y Y
421 1.72 80.0 No N N
422 1.38 73.2 No Y Y
423 2.05 48.3 No Y Y
424 1.65 64.6 No Y N
425 1.54 70.8 No Y N
426 Office Depot 1.05 86.1 No Y N
427 1.58 72.0 No Y N
428 1.30 73.7 No Y Y
429 1.21 69.6 No Y Y
430 1.38 47.6 No N N
431 1.25 78.0 No Y Y
432 Walgreen Company Y N 1.01 94.4 No Y N
433 JC Penney 1.01 99.4 No N N
434 1.32 74.4 No Y N
435 1.53 79.8 No Y Y
436 1.28 74.9 BA - 1 Y N
437 Rite Aid Corp. 1.12 94.5 No Y N
438 Rite Aid Corp. 1.12 87.2 No Y N
439 1.43 69.2 No N N
440 1.34 75.8 No N N
441 1.10 63.0 No Y N
442 JC Penney 1.24 85.8 No N N
443 1.30 74.6 No Y Y
444 1.39 80.0 No Y Y
445 1.48 74.7 No Y Y
446 1.57 56.3 No Y Y
447 JC Penney 1.00 97.1 No N N
448 Walgreen Company 1.03 85.7 No Y N
449 1.29 74.9 No N Y
450 1.27 79.2 No Y Y
451 1.54 58.3 No Y Y
452 1.35 79.9 No Y Y
</TABLE>
B-9
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
453 Eckerd Drugs State Route 211 and Blumel Road
454 3848-3870 East Foothill Boulevard (East Pasadena) 3848-3870 East Foothill Boulevard
455 Westporte Apartments 2805 Larchmont Lane
456 Best Western St. Augustine 2445 State Road 16
457 Nalley Valley Self Storage 2201 S. Tacoma Way
458 Woodley Apartments 7035 Woodley Avenue
459 Hidden Park Apartments 10613 Lookaway Drive
460 Saum Apartments 1919 South Grand Boulevard
461 Days Inn/Kingsland 1050 East King Avenue
462 P Street 1743 P Street
463 Canoga Apartments 10400 East Canoga Avenue
464 Rite Aid Pharmacy (Liberty) Route 52
465 Woodway Apartments 2895 Dorthy Jeanie Drive
466 CVS Pharmacy (Philadelphia) 1099 Washington Avenue
467 Eckerd Wildwood 4201 Atlantic Ave.
468 Arrow Press Properties 52-60 West 200 South Street
469 Northbrook Apartments 584 East Bullard Ave.
470 Best Western Statesville 1121 Morland Drive
471 CVS Drug Store (Martinsville) S.R. 39 & Randolph Street
472 Sunnyside Acres Mobile Home Park 905 West Sunnyside Road
473 Auto/Retail Facility (Lauderhill) 6440 W. Commercial Boulevard
474 Campostella Corners Shopping Center South Military Highway/Campostella Road
475 Shops at State Bridge 5950 State Bridge Road
476 901 W. Jackson Boulevard 901 W Jackson Boulevard
477 155 North Beacon Street 155 North Beacon Street
478 Eckerd Oviedo Mitchell Hammock & Lockwood
479 Fairfield Inn (Musselman-Mt.Sterling) 105 Stone Trace Drive
480 Hampton Inn (Musselman-Elizabethtown) 1035 Executive Drive
481 Stone Pine Center 20-40 Stone Pine Road
482 CVS Pharmacy (Vernon) 142 Talcottville Road
483 Shannon Square 3605-45 Library Road
484 The Aspens 10130 Donner Trail Road
485 Casa Del Sol 951-969 Contra Costa Blvd.
486 Newtonian Gardens 70 West End Avenue
487 Rite Aid Gaylord 419 Main Street
488 Springwood Village Shopping Center 6-48 West 7200 South
489 Bella Mar 825 Ocean Avenue
490 Amerihost Inn - Macomb 1646 North Lafayette
491 Amerihost Inn-Lancaster 1721 River Valley Circle North
492 Amerihost Inn - Logan 12819 State Road 664
493 Amerihost Inn- Jeffersonville 11431 Allen Road NW
494 Eckerd Drug Store (Jacksonville) NWC Southside Boulevard and Touchton Road
495 CVS Brazil SEC Forest Ave & National Ave
496 Gardner Plaza Pearson Boulevard
497 Lobo Canyon Shopping Center 700 East Roosevelt Ave.
498 Officemax Free-Standing Retail/Commercial Building South Side of Route 611
499 Saint Charles Place 2199 Southwest 81st Ave.
500 The In-Line Retail Shop Space (Peoria) 8940 and 8960 West Bell Road
501 Western Hills Shopping Center Highway 105 West
502 Eckerd Drug Store (Ft. Myers) South Side of Palm Beach Boulevard (S.R. 80)
503 Keep it Self Storage - Van Nuys 6827 Woodley Avenue
504 Crystal Inn (Brigham City) 480 Westland Drive
505 421 Germantown Pike 421 Germantown Pike
506 Katella/Knott Shopping Center 7003-7063 Katella Avenue
507 Amerihost Inn-Sycamore 1475 South Peace Rd.
509 Eckerd Shreveport Mansfield Rd/Bert Kouns Ind Loop
510 825 Pine Street Apartments 825 Pine Street
511 Ocean Villa Townhomes #1 4330-4204 Dallas Drive
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
453 Wallkill NY 10941 2,098,030.42 14,875.83 7.3750 119 04/01/08
454 Pasadena CA 91107 2,096,994.77 14,041.94 7.0500 142 03/01/10
455 Peoria IL 61615 2,096,775.81 13,631.73 6.7580 118 03/01/08
456 St. Augustine FL 32092 2,096,489.79 17,728.96 8.1250 239 04/01/18
457 Tacoma WA 98409 2,095,512.36 15,314.50 7.3500 238 03/01/18
458 Van Nuys CA 91406 2,093,358.54 14,294.38 7.2280 116 01/01/08
459 St Louis MO 63137 2,093,340.17 14,274.46 7.2140 116 01/15/08
460 St Louis MO 63104 2,093,340.17 14,274.46 7.2140 116 01/15/08
461 Kingsland GA 31548 2,093,196.67 17,402.23 7.8750 238 03/01/18
462 Washington DC 20036 2,092,352.17 14,504.18 7.3750 115 12/01/07
463 Chatsworth CA 91311 2,090,173.44 14,131.08 7.1130 114 11/01/07
464 Liberty NY 12754 2,080,599.32 15,014.60 7.0200 236 01/01/18
465 Fayetteville AR 72704 2,078,377.40 14,189.27 7.2500 119 04/01/08
466 Philadelphia PA 19147 2,074,140.20 14,743.00 6.9700 237 02/01/18
467 Wildwood NJ 08260 2,072,762.95 16,094.97 7.6900 236 01/01/18
468 Salt Lake City UT 84101 2,064,387.08 15,187.48 7.9990 116 01/01/08
469 Fresno CA 93710 2,057,124.09 13,914.77 7.1510 118 03/01/08
470 Statesville NC 28677 2,051,019.67 20,330.46 8.3750 175 12/01/12
471 Martinsville IN 46151 2,038,393.46 16,350.34 7.3200 235 12/01/17
472 Idaho Falls ID 83402 2,022,107.75 13,551.35 7.0580 118 03/01/08
473 Lauderhill FL 33119 1,997,734.77 14,831.90 7.5400 119 04/01/08
474 Chesapeake VA 23320 1,997,261.83 13,616.41 7.2300 118 03/01/08
475 Alpharetta GA 30136 1,995,371.55 14,033.68 6.9200 118 03/01/08
476 Chicago IL 60607 1,993,832.91 13,787.61 7.3560 116 01/01/08
477 Brighton MA 02135 1,993,519.50 15,271.08 7.8750 81 02/01/05
478 Oveido FL 32765 1,991,102.10 15,682.26 7.1600 223 12/01/16
479 Mt. Sterling KY 40353 1,991,043.78 15,004.30 7.6720 116 01/01/08
480 Elizabethtown KY 42701 1,991,043.78 15,004.30 7.6720 116 01/01/08
481 Half Moon Bay CA 94019 1,989,373.41 15,123.65 7.7630 115 12/01/07
482 Vernon CT 06066 1,969,899.72 15,748.24 7.2500 234 11/01/17
483 Castle Shannon PA 15234 1,947,537.00 13,701.51 7.5500 118 03/01/08
484 Truckee CA 96161 1,947,409.68 13,436.28 7.3510 118 03/01/08
485 Pleasant Hill CA 94523 1,946,082.26 14,633.03 7.6750 118 03/01/08
486 Newton NJ 07860 1,945,508.29 14,132.09 7.8700 117 02/01/08
487 Gaylord MI 49735 1,943,949.59 14,201.31 7.1250 236 01/01/18
488 Midvale UT 84047 1,943,757.63 14,252.71 7.9590 115 12/01/07
489 Santa Monica CA 90403 1,941,881.28 15,212.24 8.1250 116 01/01/08
490 Macomb IL 61455 1,932,862.50 15,858.45 7.6250 235 12/01/17
491 Lancaster OH 43130 1,932,862.50 15,858.45 7.6250 235 12/01/17
492 Logan OH 43138 1,908,082.25 15,655.13 7.6250 235 12/01/17
493 Octa OH 43128 1,908,082.25 15,655.13 7.6250 235 12/01/17
494 Jacksonville FL 32216 1,905,798.57 13,875.41 7.2800 236 01/01/18
495 Brazil IN 47834 1,900,652.99 14,839.26 6.9375 234 11/01/17
496 Gardner MA 01440 1,898,520.76 12,974.24 7.2600 119 04/01/08
497 Grants NM 87020 1,897,834.17 14,040.83 7.5000 119 04/01/08
498 Stroud Township PA 18360 1,897,760.17 13,782.33 7.2900 119 04/01/08
499 Miramar FL 33025 1,894,978.07 12,720.60 7.0625 117 02/01/08
500 Peoria AZ 85345 1,893,035.93 14,260.71 8.2400 114 11/01/07
501 Montgomery TX 77356 1,892,853.54 13,891.55 7.6560 116 01/01/08
502 Ft. Myers Shores FL 33905 1,892,262.33 14,814.38 6.9200 232 09/01/17
503 Van Nuys CA 91406 1,891,488.86 14,251.60 7.6700 236 01/01/18
504 Brigham City UT 84302 1,891,128.86 13,929.79 7.4100 176 12/31/12
505 Plymouth Meeting PA 19462 1,891,079.46 13,886.71 7.3750 116 01/01/08
506 Stanton CA 90680 1,888,355.34 17,472.09 7.3690 178 03/01/13
507 Sycamore IL 60178 1,883,301.94 15,451.82 7.6250 235 12/01/17
509 Shreveport LA 71118 1,864,065.74 13,867.66 7.7800 232 09/01/17
510 San Francisco CA 94108 1,862,440.71 13,456.40 7.7960 114 11/01/07
511 Oxnard CA 93033 1,847,448.95 12,558.83 7.2010 118 03/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
453 329 N 0.0900 0.0050 N - Act/360 First Union
454 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
455 358 N 0.0900 0.0050 N - Act/360 Bank of America
456 N 0.0900 0.0050 N - Act/360 First Union
457 298 N 0.0900 0.0050 N - Act/360 First Union
458 356 N 0.0900 0.0050 N - Act/360 Bank of America
459 356 N 0.0900 0.0050 N - Act/360 Bank of America
460 356 N 0.0900 0.0050 N - Act/360 Bank of America
461 N 0.0900 0.0050 N - Act/360 First Union
462 355 N 0.0900 0.0050 N - Act/360 First Union
463 354 N 0.0900 0.0050 N - Act/360 Bank of America
464 286 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
465 359 N 0.0900 0.0050 N - Act/360 First Union
466 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
467 N 0.0900 0.0050 N - 30/360 First Union Y
468 356 N 0.0900 0.0050 N - Act/360 Bank of America
469 358 N 0.0900 0.0050 N - Act/360 Bank of America
470 N 0.0900 0.0050 N - Act/360 First Union
471 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
472 358 N 0.0900 0.0050 N - Act/360 Bank of America
473 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
474 358 N 0.1500 0.0050 N - Act/360 Lehman Brothers
475 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
476 356 N 0.0900 0.0050 N - Act/360 Bank of America
477 297 N 0.0900 0.0050 N - 30/360 First Union
478 N 0.0900 0.0050 N - 30/360 First Union Y
479 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
480 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
481 295 N 0.0900 0.0050 N - Act/360 Bank of America
482 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
483 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
484 358 N 0.0900 0.0050 N - Act/360 Bank of America
485 298 N 0.0900 0.0050 N - Act/360 Bank of America
486 357 N 0.0900 0.0050 N - Act/360 First Union
487 283 N 0.0900 0.0050 N - 30/360 First Union Y
488 355 N 0.0900 0.0050 N - Act/360 Bank of America
489 296 N 0.0900 0.0050 N - Act/360 First Union
490 N 0.0900 0.0050 N - Act/360 First Union
491 N 0.0900 0.0050 N - Act/360 First Union
492 N 0.0900 0.0050 N - Act/360 First Union
493 N 0.0900 0.0050 N - Act/360 First Union
494 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
495 N 0.0900 0.0050 N - 30/360 First Union Y
496 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
497 299 N 0.0900 0.0050 N - Act/360 First Union
498 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
499 357 N 0.0900 0.0050 N - Act/360 First Union
500 354 N 0.1650 0.0050 N - Act/360 Lehman Brothers
501 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
502 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
503 296 N 0.0900 0.0050 N - Act/360 First Union
504 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
505 296 N 0.0900 0.0050 N - Act/360 First Union
506 N 0.0900 0.0050 N - 30/360 Bank of America
507 N 0.0900 0.0050 N - Act/360 First Union
509 N 0.0900 0.0050 N - 30/360 First Union Y
510 354 N 0.0900 0.0050 N - Act/360 Bank of America
511 358 N 0.0900 0.0050 N - Act/360 Bank of America
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
453 1.36 77.1 No Y Y
454 1.29 78.3 No N Y
455 1.53 74.1 No Y Y
456 1.71 69.9 No Y N
457 1.31 67.6 No Y Y
458 1.57 74.8 No Y Y
459 1.48 77.5 No Y Y
460 1.49 77.5 No Y Y
461 1.67 71.0 No Y N
462 1.25 76.8 No N Y
463 1.43 74.9 No Y Y
464 Rite Aid Corp. Y Y 1.03 97.9 No Y N
465 1.31 79.9 No Y Y
466 CVS Corporation 1.03 96.9 No Y N
467 JC Penney 1.00 94.2 No N N
468 1.11 75.1 BA - 1 Y N
469 1.34 69.0 No Y Y
470 1.40 66.2 No N N
471 Revco D.S. Inc. 1.03 93.9 No Y N
472 1.31 74.9 No Y Y
473 1.41 74.7 No Y Y
474 1.30 76.8 No Y Y
475 1.34 74.5 No Y Y
476 1.54 68.8 No Y Y
477 1.45 76.7 No N N
478 JC Penney 1.13 75.9 No Y N
479 1.53 68.7 No Y N
480 1.70 55.3 No Y N
481 1.51 69.8 No Y N
482 CVS Corporation 1.35 63.6 No Y N
483 1.34 74.9 No Y Y
484 1.25 77.0 No Y Y
485 1.57 56.4 No Y N
486 1.31 64.9 No N N
487 Rite Aid Corp. Y Y 1.00 102.3 No Y N
488 1.30 74.8 BA - 1 Y N
489 1.42 35.3 No N N
490 1.42 69.0 No Y N
491 1.49 55.2 No Y N
492 1.40 63.6 No Y N
493 1.41 63.6 No Y N
494 1.21 77.8 No Y Y
495 Revco D.S. Inc. 1.03 98.7 No N N
496 1.54 65.5 No Y Y
497 1.33 73.0 No Y Y
498 1.33 73.0 No Y Y
499 1.50 72.9 No Y Y
500 1.42 64.5 No N N
501 1.28 67.6 No Y N
502 JC Penney 1.10 82.6 No Y N
503 1.32 68.8 No Y N
504 1.49 59.1 No Y Y
505 1.26 74.2 No Y Y
506 1.45 53.7 No Y N
507 1.41 67.3 No Y N
509 JC Penney 1.24 82.9 No N N
510 1.20 70.0 No Y N
511 1.40 80.3 No Y Y
</TABLE>
B-10
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
512 Revco Pharmacy (Decatur) SWC of Candler Road and Misty Candler Road
513 Burbank Villas Apartments 14640 Burbank Blvd
514 Crestwood Apartments 1428 Raymond Street
515 121 Greene Street 121 Green Street
516 Payson Center SEC of State Route 87 and State Route 260
517 Sunrise Condominiums 550 El Camino Real
518 Village Woods Commons Shopping Center 42 Nichols Street
519 Days Inn (Prescott Valley) 7875 East Highway 69
520 Inbus Engineering Building 6233 Industrial Way
521 CVS Pharmacy (Lancaster) 32-54 W. Lemon Street
522 Warehouse Specialists - 1097 Ehlers Road 1097 Ehlers Road
523 Cedars St. Paul Apts. 1276 Wilson Avenue
524 McClintock Office Plaza 4700 S. McClintock Drive
525 Galaxy Shopping Center 2300 Planet Avenue
526 Crestwood Station Shopping Center Kentucky Highway 146
527 Village Pines 25 South Lincoln Ave.
528 395-435 East O'Keefe Street 395-435 East O'Keefe Street
529 Price Savers Center 2049 West Broadway Road
530 Indian Village Shopping Center SEC of Indian School Road and 16th Street
531 Caledon Wood Professional Park Pelham Road
532 4445 West 16th Street 4445 W. 16th Avenue
533 6 Fortune Drive 6 Fortune Drive
534 Fairmount Apartments 345-57 W. Johnson Streets
535 Palms Apartments 11007- Palms Blvd
536 Georgetown Village Apartments 1421 Reidville Road
537 336 Washington Street (Boston Private) 336 Washington Street
538 CVS Tipton 711 East Jefferson St
539 State Farm Cranford 70 Myrtle Street
540 La Jolla Court Apartments 1322 North La Jolla Boulevard
541 CVS York 820 Edgewood Road
542 Hodges Warehouse (Hodges II) 800 South Madison Avenue
543 Kling Street Apartments 11922 Kling Street
544 Eckerd Drug Store (Camden) SWC of DeKalb Street and Campbell Street
545 CVS Drug Store (Mableton) 5846-5856 Mableton Parkway
546 CVS Rockville NWC US 36 & SR 41
547 CVS Edinburgh NEC US 31 & Eisenhower Rd
548 Fry's Greenfield Plaza NEC Greenfield Road and University Drive
549 Target Center 15329 Palmdale Blvd.
550 CVS Greece 3750 Mt. Read Boulevard
551 Ames Plaza (Amenia) Route 22
552 North Creek Townhomes 515- 112th ST. S.E.
553 Hilltop Village Shopping Center U.S. Highway 158
554 Friendly Square Shopping Center 11651 West 64th Avenue
555 Eckerd Oldsmar 3771 Tampa Road
556 Henderson Mall 675 Mall Ring Circle
557 Anchor Self Storage - Glendora 700 E. Acosta
558 8614 Burton Way Apts. 8614 Burton Way
559 Four Industrial Buildings (Great S.W. Industrial) Various
560 Spa Business Center 145-155 East 6100 South
561 Warehouse Specialists - Harrison Street 2440 Harrison Street
562 Port Jefferson Medical Park 5380 Nesconset Highway
563 Ashcroft Industrial Park 7313-7399 Ashcroft
564 8586-8588 Potter Park Drive (Palmer Ranch) 8586-8588 Potter Park Drive
565 New Hampshire Apartments 345 South New Hampshire St.
566 Villa Fontana Apartments 7540 S.W. 59th Court
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
512 Decatur GA 30032 1,840,419.99 14,490.34 7.1000 236 01/01/18
513 Los Angeles CA 91411 1,824,386.08 12,217.72 7.0510 118 03/01/08
514 Boise ID 83701 1,817,376.36 12,132.96 7.0200 118 03/01/08
515 New York NY 10012 1,800,000.00 12,536.60 7.4600 120 05/01/08
516 Payson AZ 85541 1,797,620.30 12,426.02 7.3700 118 03/01/08
517 Burlingame CA 94010 1,794,157.35 12,091.72 7.0960 116 01/01/08
518 Ogden NY 14559 1,792,241.27 13,785.55 7.9100 116 01/01/08
519 Prescott AZ 86314 1,790,697.82 14,984.31 7.9360 237 02/01/18
520 Livermoore CA 94550 1,777,871.31 16,590.22 7.4060 176 01/01/13
521 Lancaster PA 17603 1,765,000.00 12,193.04 6.9000 249 02/01/19
522 Menasha WI 54956 1,764,555.20 16,391.49 7.4375 178 03/01/13
523 St. Paul MN 55106 1,757,481.94 11,769.67 7.0510 118 03/01/08
524 Tempe AZ 85282 1,748,704.62 12,251.84 7.5130 119 04/01/08
525 Salina KS 67401 1,745,149.43 12,706.94 7.8900 116 01/01/08
526 Crestwood KY 40014 1,744,600.57 12,060.59 7.3530 116 01/01/08
527 Orchard Park NY 14127 1,742,848.98 12,796.06 7.3800 116 01/01/08
528 East Palo Alto CA 94303 1,741,530.67 11,910.80 7.2500 117 02/01/08
529 Mesa AZ 85202 1,722,787.60 12,049.64 7.4900 238 03/01/18
530 Phoenix AZ 85016 1,708,262.64 15,127.09 7.6400 200 01/01/15
531 Greenville SC 29615 1,705,674.66 11,746.57 7.3200 117 02/01/08
532 Hialeah FL 33012 1,698,200.81 12,171.66 7.7400 118 03/01/08
533 Billerica MA 01821 1,697,966.99 12,233.01 7.2000 119 04/01/08
534 Philadelphia PA 19144 1,697,942.60 12,151.15 7.1250 119 04/01/08
535 Los Angeles CA 90034 1,697,751.38 11,733.37 7.3680 118 03/01/08
536 Spartanburg SC 29306 1,697,602.64 11,436.01 7.1100 118 03/01/08
537 Wellesley MA 02181 1,697,590.85 11,413.09 7.0900 178 03/01/13
538 Tipton IN 46072 1,668,582.84 13,339.39 7.2500 234 11/01/17
539 Cranford NJ 07016 1,666,978.73 18,546.86 7.5625 115 12/01/07
540 Goodyear AZ 85338 1,652,187.67 12,116.49 7.3600 80 01/01/05
541 York PA 17402 1,645,957.00 12,688.15 6.8500 237 02/01/18
542 Okmulgee OK 74447 1,645,107.98 15,493.27 7.7100 179 04/01/13
543 Los Angeles CA 91607 1,635,711.37 11,048.98 7.1250 117 02/01/08
544 Camden SC 29020 1,631,475.16 12,252.21 7.4200 234 11/01/17
545 Mableton GA 30059 1,605,822.34 11,434.20 6.9700 236 01/01/18
546 Rockville IN 47872 1,604,207.35 12,524.77 6.9375 234 11/01/17
547 Edinburgh IN 46124 1,599,803.95 12,789.54 7.2500 234 11/01/17
548 Mesa AZ 85205 1,597,884.71 11,045.35 7.3700 118 03/01/08
549 Victorville CA 92392 1,596,484.25 11,514.45 7.2010 118 03/01/08
550 Greece NY 14616 1,595,748.59 11,316.72 7.0000 236 01/01/18
551 Amenia NY 12501 1,595,195.82 11,176.48 7.4900 116 01/01/08
552 Everett WA 98208 1,594,881.62 10,828.14 7.1700 116 01/01/08
553 Oxford NC 27565 1,594,743.67 11,860.17 7.5200 116 01/01/08
554 Arvada CO 80004 1,588,764.57 10,868.18 7.2700 119 04/01/08
555 Oldsmar FL 34677 1,587,542.88 12,595.46 7.3000 224 01/01/17
556 Henderson NV 89014 1,575,000.00 12,147.87 7.2100 120 05/01/08
557 Glendora CA 91740 1,556,622.29 11,305.96 7.2800 118 03/01/08
558 Los Angeles CA 90048 1,548,751.88 10,406.04 7.0900 119 04/01/08
559 Ft. Worth TX 75224 1,546,386.62 11,333.65 7.3800 118 03/01/08
560 Murray UT 84107 1,545,038.11 11,329.08 7.9590 115 12/01/07
561 Neenah WI 54956 1,540,879.18 14,313.70 7.4375 178 03/01/13
Port Jefferson
562 Station NY 11776 1,520,687.32 10,967.47 7.7900 116 01/01/08
563 Houston TX 77081 1,515,445.10 10,628.06 7.5000 116 01/01/08
564 Sarasota FL 34238 1,498,880.08 10,457.42 7.4700 119 04/01/08
565 Los Angeles CA 90020 1,498,839.13 10,273.37 7.2900 83 04/01/05
566 South Miami FL 33143 1,496,067.38 10,090.60 7.1100 117 02/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
512 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
513 358 N 0.0900 0.0050 N - Act/360 Bank of America
514 358 N 0.0900 0.0050 N - Act/360 First Union
515 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
516 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
517 356 N 0.0900 0.0050 N - Act/360 Bank of America
518 N 0.0900 0.0050 Y 3.0000 Act/360 Lehman Brothers
519 N 0.0900 0.0050 N - 30/360 Lehman Brothers
520 N 0.0900 0.0050 N - 30/360 Bank of America
521 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
522 N 0.0900 0.0050 N - Act/360 First Union
523 358 N 0.0900 0.0050 N - Act/360 Bank of America
524 359 N 0.0900 0.0050 N - Act/360 Bank of America
525 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
526 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
527 296 N 0.1400 0.0050 N - Act/360 Lehman Brothers
528 357 N 0.0900 0.0050 N - Act/360 First Union
529 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
530 Y 0.1650 0.0050 N - 30/360 Lehman Brothers
531 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
532 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
533 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
534 299 N 0.0900 0.0050 N - Act/360 First Union
535 358 N 0.0900 0.0050 N - Act/360 Bank of America
536 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
537 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
538 N 0.0900 0.0050 N - 30/360 First Union Y
539 N 0.0900 0.0050 N - 30/360 First Union Y
540 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
541 N 0.0900 0.0050 N - 30/360 First Union Y
542 N 0.0900 0.0050 N - 30/360 Lehman Brothers
543 357 N 0.0900 0.0050 N - Act/360 Bank of America
544 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
545 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
546 N 0.0900 0.0050 N - 30/360 First Union Y
547 N 0.0900 0.0050 N - 30/360 First Union Y
548 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
549 298 N 0.0900 0.0050 N - Act/360 Bank of America
550 N 0.0900 0.0050 N - 30/360 First Union Y
551 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
552 356 N 0.0900 0.0050 N - Act/360 First Union
553 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
554 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
555 N 0.0900 0.0050 N - 30/360 First Union Y
556 252 N 0.0900 0.0050 N - Act/360 First Union
557 298 N 0.0900 0.0050 N - Act/360 First Union
558 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
559 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
560 355 N 0.0900 0.0050 N - Act/360 Bank of America
561 N 0.0900 0.0050 N - Act/360 First Union
562 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
563 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
564 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
565 359 N 0.0900 0.0050 N - Act/360 First Union
566 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
512 Revco D.S. Inc. 0.95 80.5 No Y N
513 1.34 73.0 No Y Y
514 1.31 63.8 No N Y
515 1.37 75.0 No Y Y
516 1.36 71.9 LB-E N Y
517 1.30 64.7 No Y Y
518 1.34 74.7 No Y N
519 1.45 74.6 No Y N
520 1.38 53.2 No Y N
521 CVS Corporation 1.08 98.1 No Y N
522 1.54 53.5 WSI Y Y
523 1.51 78.1 No Y Y
524 1.34 74.4 No Y Y
525 1.40 72.7 No N N
526 1.85 38.8 LB-B Y Y
527 1.26 79.2 No Y Y
528 1.27 72.6 No Y Y
529 1.38 74.9 No N Y
530 1.45 74.3 No N N
531 1.34 74.8 No Y Y
532 1.42 60.7 No Y N
533 1.36 60.6 No Y Y
534 1.26 77.2 No Y Y
535 1.34 74.8 No Y Y
536 1.25 78.6 No Y Y
537 1.36 72.2 No N Y
538 Revco D.S. Inc. 1.03 95.4 No N N
539 State Farm 1.00 79.4 No N N
540 1.33 74.6 No Y Y
541 CVS Corporation 1.00 98.3 No N N
542 1.29 65.8 LB-F Y N
543 1.28 79.8 No Y Y
544 JC Penney 1.05 98.9 No Y N
545 CVS Corporation 1.09 98.5 No Y N
546 Revco D.S. Inc. 1.03 99.0 No N N
547 Revco D.S. Inc. 1.03 97.0 No N N
548 1.65 63.9 LB-E N Y
549 1.56 74.6 No Y Y
550 CVS Corporation 1.10 99.7 No Y N
551 1.38 63.8 No N Y
552 1.28 72.5 No Y Y
553 1.34 66.5 No Y Y
554 1.36 69.1 No N Y
555 JC Penney 1.34 68.0 No N N
556 1.28 67.7 No Y Y
557 1.30 65.5 No Y Y
558 1.31 70.4 No Y Y
559 1.67 44.2 No Y N
560 1.33 74.5 BA - 1 Y N
561 1.46 64.2 WSI Y Y
562 1.26 62.1 No Y N
563 1.30 77.7 No Y Y
564 1.29 74.9 No Y Y
565 1.28 74.9 No Y Y
566 1.39 74.8 No Y Y
</TABLE>
B-11
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
567 Briarcliff 4314 Commomwealth Ave, A-1
569 Duna Vista Mobile Home Park 2400 Cienega
570 Calvert Apartments 11434-11450 Calvert Street
571 177 E. Evelyn Avenue 177 E. Evelyn Avenue
572 Oakland State Garage 401 27Th Street
573 IHOP Kannapolis 800 Cloverleaf Plaza
574 Park Rochester Apartments 11425 Rochester Avenue
575 West Town Professional Center 21675 Longview Drive
576 CVS Aiken Whiskey Rd & Shannon Lane
577 Garage Loft Apartments 113 N.W. 13th Street
578 Rite-Aid Pharmacy (Waynesburg) 8619 Waynesburg Drive
579 Forest Glen 2800-2875 Forest Glen Road
580 Revco Drug Store 2939 The Plaza Road
581 Rite Aid Pharmacey (Hogansville) 100 South Highway 29
582 Revco Pharmacy (Oak Ridge) 1287 Oak Ridge Turnpike
583 Imperial Plaza Office Building 1129 Watertower Lane
584 Overlook Court 4620-40 Richmond Road
585 10051 Pasadena Avenue 10051 Pasadena Avenue
586 Clifford Pacific Business Park 20382 & 20412 Barents Sea Circle
587 Glynbrook Estates 3642 Glynbrook Avenue
588 Cypress Winds 2105 Cleary
589 66 West 84th Street 66 West 84th Street
590 Canon Perdido 433 E. Canon Perdido Street
591 Panorama Medical Arts Building 8215 Van Nuys Blvd
592 IHOP Gastonia 500 Cox Road
593 Taylor Gardens 7601-7715 Hillendale Road
594 Tara Ridge Apartments 6700 Tara Boulevard
595 Camelot and Circle Inn Mobile Home Parks 330 W. Chubbuck Rd. and 210 Circle Inn St.
596 Shoppes of Pembroke 12101 Taft Street
597 Normandy Retail Center 957, 969 & 1111 Normandy Drive
598 La Tijera Manor Apartments 7100-7124 Alvern Street
599 Applied Companies Building 28020 Avenue Standford
600 238-268 Post Road 238-268 Post Road
601 Warehouse Specialists - 1286 Ehlers Road 1286 Ehlers Road
602 Warehouse Specialists - Dixie Street 356 Dixie Street
604 IHOP Wilmington 5355 Market Street
605 Eckerd Kernersville SEC Nelson St & Piney Grove Rd
606 Eckerds Easley 5991 Calhoun Memorial Highway
607 Rincon Plaza SWC of Golf Links Road and Harrison Road
608 Eckerd Store (Mt. Holly) 617 Highland Street
609 University Court Apartments 1414 3Rd Street South
610 Patrick Business Park 6165 Annie Oakley Drive
611 Eckerd Store (Florence) W. Palmetto Street/Cashua Drive
612 222 Post Road 222 Post Road
613 Ocean Villa Townhomes #3 4401-4601 Dallas Drive
614 Kennestone Corners Business Center 1265 Kennestone Circle
615 Kings Tree Apartments 1800 Kingsley Avenue
616 Rite Aid Pharmacy (Williamsport) 14 West Fifth Street
617 CVS Pharmacy (Westbrook) 870 Main Street
618 Brookhill Plaza 1787 Fort Union Blvd
619 Lexington Village Apartments 200-206 Lexington Drive and 902-911 Christy Court
620 2715 Agate Court 2175 Agate Court
621 Townsgate Atrium 2277 Townsgate Road
622 Carey Hill Plaza 220 E. Ashland Street
623 Edison Apartments 5651 East Edison Street
624 Warehouse Specialists - Bell Street 555 Bell Street
625 Warehouse Specialists - Combined Locks 100 West Prospect Street
626 A-Advance Self-Storage 301 West Indian School Road
627 Williamstown Bay 4809 Dale Street
628 52 Liberty Street 52 Liberty Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
567 Charlotte NC 28205 1,493,242.99 11,216.92 7.6350 296 01/01/23
569 Oceano CA 93445 1,486,040.28 13,703.94 7.2630 177 02/01/13
570 North Hollywood CA 91606 1,470,406.50 10,118.19 7.3060 116 01/01/08
571 Mountain View CA 94041 1,467,025.62 10,995.46 7.6380 118 03/01/08
572 Oakland CA 94612 1,462,085.02 12,021.78 7.6540 115 12/01/07
573 Kannapolis NC 28083 1,457,928.76 10,350.00 7.8750 292 09/01/22
574 Los Angeles CA 90025 1,453,916.87 9,736.73 7.0510 118 03/01/08
575 Brookfield WI 53205 1,446,464.48 10,173.38 7.5350 117 02/01/08
576 Aiken SC 29803 1,436,118.62 11,306.74 7.1250 237 02/01/18
577 Oklahoma City OK 73103 1,435,402.50 9,755.07 7.1800 116 01/01/08
578 Sandy Township OH 44688 1,426,496.18 10,852.98 7.2300 211 12/01/15
579 Baltimore MD 21216 1,421,618.18 9,682.38 7.2100 117 02/01/08
580 Charlotte NC 28205 1,420,431.88 9,835.21 7.3750 117 02/01/08
581 Hogansville GA 30230 1,413,906.15 11,756.17 7.5400 225 02/01/17
582 Oak Ridge TN 19147 1,413,228.06 10,427.02 7.3400 207 08/01/15
583 West Carrollton OH 45449 1,398,946.34 9,721.99 7.4300 119 04/01/08
584 Warrensville Heights OH 44128 1,398,927.25 9,636.08 7.3400 119 04/01/08
585 Cupertino CA 95014 1,397,163.99 10,466.38 7.6320 118 03/01/08
586 Lake Forest CA 92630 1,396,259.85 9,314.23 7.0000 81 02/01/05
587 Keizer OR 97303 1,395,038.52 9,789.00 7.5000 115 12/01/07
588 Metairie LA 70002 1,390,838.57 9,177.03 6.9100 119 04/01/08
589 New York NY 10024 1,376,574.41 9,583.10 7.4300 117 02/01/08
590 Santa Barbara CA 93101 1,373,982.61 9,628.33 7.5150 119 04/01/08
591 Panorama City CA 91402 1,365,634.97 10,033.48 7.9800 115 12/01/07
592 Gastonia NC 28054 1,362,341.15 9,675.00 7.8750 283 12/01/21
593 Baltimore MD 21234 1,346,725.69 9,072.43 7.1000 117 02/01/08
594 Jonesboro GA 30236 1,346,566.52 9,395.62 6.8300 118 03/01/08
595 Chubbuck ID 83202 1,345,749.00 9,209.38 7.2500 116 01/01/08
596 Pembroke Pines FL 33026 1,326,253.83 9,583.49 7.8100 176 01/01/13
597 Miami Beach FL 33134 1,298,285.64 8,983.21 7.3800 118 03/01/08
598 Los Angeles CA 90045 1,298,280.46 8,972.58 7.3680 118 03/01/08
599 Santa Clarita CA 91355 1,297,300.01 9,607.73 7.5010 118 03/01/08
600 Fairfield CT 06430 1,295,028.76 9,337.94 7.1800 177 02/01/13
601 Neenah WI 54956 1,292,350.28 12,005.04 7.4375 178 03/01/13
602 Fond Du Lac WI 54935 1,292,350.28 12,005.04 7.4375 178 03/01/13
604 Wilmington NC 28405 1,264,040.35 9,075.00 7.8750 280 09/01/21
605 Kernersville NC 27284 1,258,690.89 9,619.25 7.1250 229 06/01/17
606 Easley SC 29640 1,256,879.83 9,296.84 6.7900 225 02/01/17
607 Tucson AZ 85730 1,253,340.82 8,663.70 7.3700 118 03/01/08
608 Mt. Holly NC 28120 1,235,810.25 10,223.72 7.5800 229 06/01/17
609 Minneapolis MN 55454 1,230,003.85 8,559.29 6.7840 117 02/01/08
610 Las Vegas NV 89120 1,225,749.60 8,697.40 7.6150 115 12/01/07
611 Florence SC 29501 1,217,660.73 10,094.07 7.4700 224 01/01/17
612 Fairfield CT 06430 1,215,334.67 8,763.30 7.1800 177 02/01/13
613 Oxnard CA 93033 1,198,345.26 8,146.27 7.2010 118 03/01/08
614 Marietta GA 30066 1,197,430.82 8,743.38 7.3400 118 03/01/08
615 Orange Park FL 32073 1,196,993.15 8,288.10 7.3750 117 02/01/08
616 Williamsport PA 17701 1,192,416.56 9,573.00 7.0600 225 02/01/17
617 Westbrook ME 04092 1,162,826.18 9,433.54 7.4200 233 10/01/17
618 Salt Lake City UT 84121 1,158,791.94 8,509.76 7.9750 115 12/01/07
619 Clarksville TN 37040 1,149,068.46 7,697.37 7.0600 119 04/01/08
620 Simi Valley CA 93065 1,147,038.62 7,817.75 7.2150 117 02/01/08
621 Thousand Oaks CA 91361 1,130,478.49 8,220.09 7.8630 114 11/01/07
622 Brockton MA 02402 1,120,962.08 8,405.34 7.6250 117 02/01/08
623 Tucson AZ 85712 1,102,685.96 7,459.73 7.1340 116 01/01/08
624 Neenah WI 54956 1,093,527.16 10,158.11 7.4375 178 03/01/13
625 Combined Locks WI 54113 1,093,527.16 10,158.11 7.4375 178 03/01/13
626 Phoenix AZ 85013 1,083,699.73 10,425.36 7.8630 175 12/01/12
627 McFarland WI 53558 1,074,983.00 8,751.16 9.1100 297 02/01/23
628 Kearny NJ 07032 1,064,955.41 7,651.28 7.7500 116 01/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
567 N 0.0900 0.0050 N - Act/360 First Union
569 N 0.0900 0.0050 N - 30/360 Bank of America
570 356 N 0.0900 0.0050 N - Act/360 Bank of America
571 298 N 0.0900 0.0050 N - Act/360 Bank of America
572 235 N 0.0900 0.0050 N - Act/360 Bank of America
573 N 0.0900 0.0050 N - 30/360 First Union Y
574 358 N 0.0900 0.0050 N - Act/360 Bank of America
575 357 N 0.0900 0.0050 N - Act/360 Bank of America
576 N 0.0900 0.0050 N - 30/360 First Union Y
577 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
578 262 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
579 357 N 0.0900 0.0050 N - 30/360 First Union
580 357 N 0.0900 0.0050 N - Act/360 First Union
581 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
582 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
583 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
584 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
585 298 N 0.0900 0.0050 N - Act/360 Bank of America
586 357 N 0.0900 0.0050 N - Act/360 Bank of America
587 355 N 0.0900 0.0050 N - Act/360 First Union
588 359 N 0.0900 0.0050 N - Act/360 First Union
589 Y 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
590 359 N 0.0900 0.0050 N - Act/360 Bank of America
591 355 N 0.0900 0.0050 N - Act/360 Bank of America
592 N 0.0900 0.0050 N - 30/360 First Union Y
593 357 N 0.0900 0.0050 N - 30/360 First Union
594 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
595 356 N 0.0900 0.0050 N - Act/360 First Union
596 N 0.1500 0.0050 Y 3.0000 Act/360 Lehman Brothers
597 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
598 358 N 0.0900 0.0050 N - Act/360 Bank of America
599 298 N 0.0900 0.0050 N - Act/360 Bank of America
600 297 N 0.1400 0.0050 N - Act/360 Lehman Brothers
601 N 0.0900 0.0050 N - Act/360 First Union
602 N 0.0900 0.0050 N - Act/360 First Union
604 N 0.0900 0.0050 N - 30/360 First Union Y
605 N 0.0900 0.0050 N - 30/360 First Union Y
606 Y 0.0900 0.0050 N - 30/360 First Union Y
607 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
608 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
609 297 N 0.0900 0.0050 N - Act/360 Bank of America
610 355 N 0.0900 0.0050 N - Act/360 Bank of America
611 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
612 297 N 0.1400 0.0050 N - Act/360 Lehman Brothers
613 358 N 0.0900 0.0050 N - Act/360 Bank of America
614 298 N 0.1400 0.0050 N - Act/360 Lehman Brothers
615 357 N 0.0900 0.0050 N - Act/360 First Union
616 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
617 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
618 355 N 0.0900 0.0050 N - Act/360 Bank of America
619 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
620 357 N 0.0900 0.0050 N - Act/360 Bank of America
621 354 N 0.0900 0.0050 N - Act/360 Bank of America
622 297 N 0.0900 0.0050 N - Act/360 First Union
623 356 N 0.0900 0.0050 N - Act/360 Bank of America
624 N 0.0900 0.0050 N - Act/360 First Union
625 N 0.0900 0.0050 N - Act/360 First Union
626 N 0.0900 0.0050 N - 30/360 Bank of America
627 357 N 0.0900 0.0050 N - Act/360 First Union
628 356 N 0.0900 0.0050 N - Act/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
567 1.43 67.9 No Y N
569 1.14 55.0 No Y N
570 1.50 79.9 No Y Y
571 1.53 69.9 No Y N
572 1.42 75.0 No Y N
573 IHOP Corp 1.10 97.2 No Y N
574 1.54 56.6 No Y Y
575 1.48 72.3 No Y Y
576 CVS Corporation 1.24 74.4 No Y N
577 1.40 79.7 No Y Y
578 Rite Aid Corp. Y Y 1.03 97.4 No N N
579 1.38 74.8 No N N
580 1.29 80.3 No Y Y
581 Rite Aid Corp. 1.03 87.8 No Y N
582 Revco D.S. Inc. 1.05 88.3 No Y N
583 1.23 79.9 No Y Y
584 1.27 72.5 No Y Y
585 1.38 65.0 No Y N
586 1.36 72.1 No Y Y
587 1.30 73.4 No N Y
588 1.29 79.9 No Y Y
589 1.33 68.8 No Y Y
590 1.29 65.4 No Y Y
591 1.36 78.0 No Y N
592 IHOP Corp 1.10 96.6 No Y N
593 1.47 74.8 No N N
594 1.29 77.0 No Y N
595 1.43 74.8 No Y Y
596 1.32 74.7 No Y N
597 1.42 72.1 No Y Y
598 1.45 74.2 No Y Y
599 1.65 59.5 No Y Y
600 1.27 70.0 No Y Y
601 1.53 51.7 WSI Y Y
602 1.51 54.5 WSI Y Y
604 IHOP Corp 1.10 95.8 No Y N
605 JC Penney 1.20 81.2 No Y N
606 JC Penney 1.02 78.6 No N N
607 1.31 74.6 LB-E N Y
608 JC Penney 1.33 70.2 No Y N
609 1.55 76.9 No Y Y
610 1.34 75.9 No Y N
611 JC Penney 1.05 87.0 No Y N
612 1.34 71.5 No Y Y
613 1.47 76.8 No Y Y
614 1.29 65.3 No Y Y
615 1.27 66.5 No Y Y
616 Rite Aid Corp. 1.46 64.5 No N N
617 CVS Corporation 1.03 89.5 No Y N
618 1.31 74.8 BA - 1 Y N
619 1.33 76.6 No Y Y
620 1.38 54.6 No Y Y
621 1.44 70.7 No Y N
622 1.25 72.3 No Y N
623 1.38 77.1 No Y Y
624 1.39 57.9 WSI Y Y
625 1.42 67.1 WSI Y Y
626 1.38 63.8 No Y N
627 1.21 73.6 No Y N
628 1.27 74.7 No Y N
</TABLE>
B-12
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Pool Total
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
629 Highview Apartments 930-934 Greenbriar Drive and 1024 Hillcrest Drive
630 Kingwood 118 Kingwood Drive
631 Nob Hill Office Park 2520 Longview Street
632 North Post Oak Business Center 1500 North Poast Oak Road
633 Morningside Square Apartments 2401-2414 Shakespeare Road
634 Randall Court Apartments 6716-6728 Randall Court
635 Dillard Office Building 2424 Springer Drive
636 128th Street Warehouse 4590 N.W. 128th Street
637 Briarcliff Mews Apartments 803 Briarcliff Road
638 Westgate Apartments 8721 Owensmouth Avenue
639 Broadmoor Apartments 725 S. Tucson Blvd
640 Wolfpack Village Apartments 643-733,735&738 Knox Street N. & 99&31 Gentle Ave.
641 William Tell Apartments 203 Eden Drive
642 13Th South Self Storage 1150 South 500 West
643 19-25 Brighton Avenue 19-25 Brighton Avenue
644 The In-Line Shop Space (Chandler) 940 North Alma School Road
645 Haverford Apartments 870 North Haverford Avenue
646 Crates shopping center 14 North Bridge Avenue
647 Dahnert Park Apartments One Dahnert Park Lane
648 Roger Post 4022 North Rogers Avenue
649 Ruffolo Plaza 9701-9711 West Sample Road
650 Continental House 4318 South 25th Street
651 NTB Store Site Vestal Parkway East
652 Pier 1 Imports 1524 Skyland Boulevard
653 Sunbelt Newport News 745 Industrial Park Drive
654 Northpointe Apartments 1329-1357 No. Redwood Road
655 Francesca Apartments 775 East 11th Avenue
656 514 - 524 Huron Blvd. SE 514 - 524 Huron Boulevard, SE
657 4030 Pacheco Boulevard 4030 Pacheco Boulevard
658 USPS Fallon 120 Allen Road
659 Las Flores Apartments 145 South Avenue B
660 Woodlawn Village 6601-6705 Kincheloe
661 Monmouth Beach Village 108 South Cookman Avenue
662 325 North Howard Street 325 North Howard Street
663 Pikesville Professional Building 7 Church Lane
664 Washington Place 944 Old Washington Road
665 1416-1430 S. Main Street 1416-1430 S. Main Street
666 Hodges Warehouse and Corporate Offices (Hodges I) 4401 South 72nd East Avenue
667 Commerce Square Shopping Center 203 Commerce Avenue
668 Villa Apartments 1111 7Th Street South
669 Magnolia 2100 River View Rd.
670 Blockbuster Video Store 6324 Custer Road
671 Creamery Hills 355 Creamery Road
672 13348 Newport Boulevard (Walgreen - Tustin) 13348 Newport Boulevard
673 Wells Court 1856 Wells Drive
674 Logan Square Shopping Center SWC of Logan Drive and Memorial Parkway (Highway 231)
675 2486 Morris Avenue 2486 Morris Avenue
676 Branford Apartments 12850 Bradford Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
629 DeKalb IL 60115 1,060,000.00 7,231.07 7.2500 120 05/01/08
630 Murfreesboro TN 37130 1,059,090.79 7,309.30 7.3300 175 12/01/12
631 Austin TX 78705 1,048,643.01 7,313.02 7.4600 118 03/01/08
632 Houston TX 77055 1,047,141.55 6,908.28 6.8900 81 02/01/05
633 Houston TX 77030 1,044,004.88 7,651.14 7.3410 115 12/01/07
634 Gladstone MO 64118 1,012,794.54 6,924.02 7.2400 116 01/01/08
635 Norman OK 73609 997,934.48 7,409.44 7.5300 118 03/01/08
636 Opa Locka FL 33054 997,930.56 7,402.93 7.5200 118 03/01/08
637 Atlanta GA 30306 997,476.59 6,991.43 6.8800 118 03/01/08
638 Canoga Park CA 91304 997,277.19 6,578.65 6.8890 117 02/01/08
639 Tucson AZ 85716 997,248.62 6,537.91 6.8280 117 02/01/08
640 Monmouth OR 97361 995,293.89 7,299.09 7.3600 296 01/01/23
641 Longview TX 75605 993,266.00 7,389.91 7.5000 114 11/01/07
642 Salt Lake City UT 84101 992,949.59 7,718.16 8.0000 113 10/01/07
643 Allston MA 02134 989,227.70 6,753.55 7.2500 119 04/01/08
644 Chandler AZ 85224 972,608.45 6,817.34 7.5000 117 02/01/08
645 Pacific Palisades CA 90272 970,329.45 6,862.13 7.5670 113 10/01/07
646 Redbank NJ 07701 958,969.88 7,330.12 7.8750 179 04/01/13
647 Garfield NJ 07026 957,508.82 6,496.88 7.1700 177 02/01/13
648 Baltimore MD 21207 950,688.06 6,404.46 7.1000 117 02/01/08
649 Coral Springs FL 33065 933,851.66 7,084.98 7.7500 116 01/01/08
650 Omaha NE 68107 930,000.00 6,109.44 6.8750 120 05/01/08
651 Vestal NY 13805 918,191.46 6,490.53 7.2900 236 01/01/18
652 Tuscaloosa AL 35405 899,313.12 6,206.88 7.3600 119 04/01/08
653 Newport News VA 23608 891,617.14 7,247.10 8.1250 234 11/01/17
654 Salt Lake City UT 84116 886,820.11 6,118.07 7.3500 118 03/01/08
655 Denver CO 80218 879,261.42 5,783.91 6.8800 83 04/01/05
656 Minneapolis MN 55414 862,793.79 5,836.10 7.1510 118 03/01/08
657 Martinez CA 94553 834,233.40 5,904.55 7.6000 117 02/01/08
658 Fallon NV 89406 828,685.79 6,965.62 7.8500 231 08/01/17
659 Yuma AZ 85364 817,376.30 5,548.87 7.1690 116 01/01/08
660 Baltimore MD 21207 786,130.46 5,354.19 7.2100 117 02/01/08
661 Long Branch NJ 07740 780,000.00 5,168.42 6.9600 360 05/01/28
662 Glendale CA 91206 773,913.25 5,225.50 7.1330 118 03/01/08
663 Pikesville MD 21208 767,358.36 5,700.25 7.5200 117 02/01/08
664 Thomson GA 30824 764,538.46 5,893.04 8.5200 299 04/01/23
665 Milpitas CA 95035 758,402.60 5,585.72 7.4380 118 03/01/08
666 Tulsa OK 74145 747,776.36 7,042.39 7.7100 179 04/01/13
667 La Grange GA 30240 747,308.05 5,603.56 7.6250 117 02/01/08
668 Minneapolis MN 55415 737,006.36 5,128.64 6.7840 117 02/01/08
669 Tunica MS 38646 722,827.14 5,446.68 8.2500 115 12/01/07
670 Plano TX 75023 695,387.84 5,577.75 8.3750 113 10/01/07
671 Harford NY 13784 606,231.70 4,313.85 7.6500 356 01/01/28
672 Tustin CA 92680 494,859.06 4,645.27 7.0600 168 05/01/12
673 Atlanta GA 30311 490,000.00 3,621.06 7.5000 300 05/01/23
674 Huntsville AL 35802 448,384.84 3,362.13 7.6250 117 02/01/08
675 Bronx NY 10468 438,203.46 3,152.21 7.7500 114 11/01/07
676 Arleta CA 91331 408,723.18 2,812.51 7.3060 116 01/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
629 360 N 0.0900 0.0050 N - Act/360 First Union
630 355 N 0.0900 0.0050 N - Act/360 First Union
631 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
632 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
633 295 N 0.0900 0.0050 N - Act/360 Bank of America
634 356 N 0.1650 0.0050 N - 30/360 Lehman Brothers
635 298 N 0.0900 0.0050 N - Act/360 Lehman Brothers
636 298 N 0.0900 0.0050 N - Act/360 Lehman Brothers
637 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
638 357 N 0.0900 0.0050 N - Act/360 Bank of America
639 357 N 0.0900 0.0050 N - Act/360 Bank of America
640 N 0.0900 0.0050 N - 30/360 Lehman Brothers
641 294 N 0.0900 0.0050 N - Act/360 Bank of America
642 293 N 0.0900 0.0050 N - Act/360 Bank of America
643 359 N 0.0900 0.0050 N - Act/360 First Union
644 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
645 353 N 0.0900 0.0050 N - Act/360 Bank of America
646 299 N 0.0900 0.0050 N - Act/360 First Union
647 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
648 357 N 0.0900 0.0050 N - 30/360 First Union
649 296 N 0.0900 0.0050 N - Act/360 First Union
650 360 N 0.0900 0.0050 N - Act/360 First Union
651 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
652 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
653 N 0.0900 0.0050 N - 30/360 First Union Y
654 358 N 0.0900 0.0050 N - Act/360 Bank of America
655 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
656 358 N 0.0900 0.0050 N - Act/360 Bank of America
657 357 N 0.0900 0.0050 N - Act/360 Bank of America
658 N 0.0900 0.0050 N - 30/360 First Union Y
659 356 N 0.0900 0.0050 N - Act/360 Bank of America
660 357 N 0.0900 0.0050 N - 30/360 First Union
661 N 0.0900 0.0050 N - Act/360 First Union
662 358 N 0.0900 0.0050 N - Act/360 Bank of America
663 297 N 0.0900 0.0050 N - 30/360 First Union
664 359 N 0.0900 0.0050 N - Act/360 First Union
665 298 N 0.0900 0.0050 N - Act/360 Bank of America
666 N 0.0900 0.0050 N - 30/360 Lehman Brothers
667 297 N 0.0900 0.0050 N - Act/360 First Union
668 297 N 0.0900 0.0050 N - Act/360 Bank of America
669 355 N 0.0900 0.0050 N - Act/360 First Union
670 293 N 0.0900 0.0050 N - Act/360 Bank of America
671 Y 0.0900 0.0050 N - Act/360 First Union
672 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
673 N 0.0900 0.0050 N - Act/360 First Union
674 297 N 0.0900 0.0050 N - Act/360 First Union
675 354 N 0.0900 0.0050 N - Act/360 First Union
676 356 N 0.0900 0.0050 N - Act/360 Bank of America
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
629 1.23 81.5 No Y Y
630 1.29 29.8 No N Y
631 1.23 65.1 No Y Y
632 1.42 74.8 No Y Y
633 1.45 74.6 No Y Y
634 1.47 79.1 No N N
635 1.28 73.9 No Y Y
636 1.36 73.9 No Y Y
637 1.29 78.2 No Y N
638 1.70 64.8 No Y Y
639 1.58 66.5 No Y Y
640 1.68 57.7 No Y N
641 1.42 66.2 No Y Y
642 1.46 59.5 No Y N
643 1.27 77.6 No Y Y
644 1.61 74.8 No N Y
645 1.19 65.6 No Y Y
646 1.32 75.2 No N N
647 1.24 79.8 No Y Y
648 1.37 74.9 No N N
649 1.34 74.7 No Y N
650 1.59 71.5 No Y Y
651 Sears Roebuck & Co. 1.02 91.8 No Y N
652 1.36 74.9 No N Y
653 Ashtead Group PLC 1.05 91.5 No N N
654 1.38 79.9 No Y Y
655 1.21 79.9 No Y Y
656 1.31 79.9 No Y Y
657 1.42 74.8 No Y N
658 USPS Fallon 1.05 69.1 No Y N
659 1.47 76.4 No Y Y
660 1.40 74.9 No N N
661 1.32 80.0 No Y Y
662 1.26 77.4 No Y Y
663 1.28 69.8 No N N
664 1.31 85.0 No N N
665 1.74 55.8 No Y Y
666 1.26 62.3 LB-F Y N
667 1.37 74.7 No Y N
668 1.39 69.9 No Y Y
669 1.31 77.3 No N N
670 1.32 63.2 No Y N
671 1.24 77.7 No Y N
672 Walgreen Company 1.00 66.0 No Y N
673 2.55 30.2 No N Y
674 1.29 74.7 No Y N
675 1.36 74.3 No N N
676 1.42 80.1 No Y Y
</TABLE>
B-13
<PAGE>
EXHIBIT C
First Union-Lehman Brothers-Bank of America 1998-C2
Form of Schedule of Exceptions to Mortgage File Delivery
<TABLE>
<CAPTION>
Control Borrower Name Document Document Exception
No. ID Status Description
---------------- ---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
</TABLE>
C-1
<PAGE>
EXHIBIT D-1
FORM OF MASTER SERVICER REQUEST FOR RELEASE
__________, 199___
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union - Lehman - Bank of America, Series 1998-C2
Ladies and Gentlemen:
In connection with the administration of the Mortgage Files held by you as
Trustee under a certain Pooling and Servicing Agreement dated as of May 1, 1998
(the "Pooling and Servicing Agreement"), by and among First Union Commercial
Mortgage Securities, Inc., as Depositor, First Union National Bank, as Master
Servicer, CRIIMI MAE Services Limited Partnership as Special Servicer, and you,
as Trustee, the undersigned hereby requests a release of the Mortgage File (or
the portion thereof specified below) held by you with respect to the following
described Mortgage Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
If only particular documents in the Mortgage File are requested, please specify
which:
Reason for requesting file (or portion thereof):
D-1-1
<PAGE>
1. Mortgage Loan paid in full.
- ----------------
The Master Servicer hereby certifies that all
amounts received in connection with the Mortgage
Loan that are required to be credited to the
Certificate Account pursuant to the Pooling and
Servicing Agreement, have been or will be so
credited.
2. Other. (Describe)
- ----------------
The undersigned acknowledges that the above Mortgage File (or requested
portion thereof) will be held by the undersigned in accordance with the
provisions of the Pooling and Servicing Agreement and will be returned to you or
your designee within ten (10) days of our receipt thereof, unless the Mortgage
Loan has been paid in full, in which case the Mortgage File (or such portion
thereof) will be retained by us permanently.
D-1-2
<PAGE>
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
First Union National Bank,
as Master Servicer
By:
------------------------------------------
Name:
Title:
D-1-3
<PAGE>
EXHIBIT D-2
FORM OF SPECIAL SERVICER REQUEST FOR RELEASE
________, 199___
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union-Lehman-Bank of America, Series 1998-C2
Ladies and Gentlemen:
In connection with the administration of the Mortgage Files held by you as
Trustee under a certain Pooling and Servicing Agreement dated as of May 1, 1998
(the "Pooling and Servicing Agreement"), by and among First Union Commercial
Mortgage Securities, Inc., as depositor, First Union National Bank, as Master
Servicer, CRIIMI MAE Services Limited Partnership, as Special Servicer, and you,
as Trustee, the undersigned hereby requests a release of the Mortgage File (or
the portion thereof specified below) held by you with respect to the following
described Mortgage Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
If only particular documents in the Mortgage File are requested, please specify
which:
Reason for requesting file (or portion thereof):
1. The Mortgage Loan is being foreclosed.
- ----------------
D-2-1
<PAGE>
2. Other. (Describe)
- ----------------
The undersigned acknowledges that the above Mortgage File (or requested
portion thereof) will be held by the undersigned in accordance with the
provisions of the Pooling and Servicing Agreement and will be returned to you or
your designee within ten (10) days of our receipt thereof, unless the Mortgage
Loan is being foreclosed, in which case the Mortgage File (or such portion
thereof) will be returned when no longer required by us for such purpose.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Pooling and Servicing Agreement.
CRIIMI MAE Services
Limited Partnership,
as Special Servicer
By:
--------------------------
Name:
Title:
D-2-2
<PAGE>
EXHIBIT E-1
CALCULATION OF NOI/DEBT SERVICE COVERAGE RATIOS
"Net Operating Income" shall mean the revenue derived from the use and
operation of a Mortgaged Property less operating expenses (such as utilities,
administrative expenses, repairs and maintenance, tenant improvement costs,
leasing commissions, management fees and advertising), fixed expenses (such as
insurance, real estate taxes and, if applicable, ground lease payments) and
reserves (such as reserves for tenant improvements and leasing commissions in
the case of Rental Properties and assumed reserves for ongoing capital
expenditures). Net cash flow does not reflect interest expenses and non-cash
items such as depreciation and amortization, and generally does not reflect
capital expenditures, but does reflect reserves for replacements.
In determining the "revenue" component of Net Operating Income for each
Rental Property, the Special Servicer shall rely on the most recent rent roll
supplied by the related borrower and where the actual vacancy shown thereon and
the market vacancy is less than 5%, the Special Servicer shall assume a 5%
vacancy in determining revenue from rents, except that in the case of certain
anchored shopping centers, space occupied by anchor tenants shall be disregarded
in performing the vacancy adjustment due to the length of the related leases or
creditworthiness of such tenants, in accordance with the respective Mortgage
Loan Seller's underwriting standards. In determining rental revenue for
multifamily properties, the Special Servicer shall either review rental revenue
shown on the rolling 12-month operating statements or annualize the rental
revenue shown on rent rolls or operating statements with respect to the prior
three to twelve month periods. For the other Rental Properties, the Special
Servicer shall annualize rental revenue shown on the most recent rent roll,
after applying the vacancy factor, without further regard to the terms
(including expiration dates) of the leases shown thereon. In the case of
hospitality properties, gross receipts shall be determined on the basis of
adjusted average daily occupancy shown on the borrower-supplied operating
statements. In the case of residential health care facilities, receipts shall be
based on historical occupancy levels, historical operating revenues and the then
current occupancy rates. Private occupancy rates shall be within current market
ranges and vacancy levels shall be at a minimum of 5%. In general, any
non-recurring items and non-property related revenue shall be eliminated from
the calculation except in the case of residential health care facilities.
In determining the "expense" component of Net Operating Income for each
Mortgaged Property, the Special Servicer shall rely on the most recent financial
statements supplied by the related borrower, except that (a) if tax or insurance
expense
E-1-1
<PAGE>
information more current than that reflected in the financial statements is
available, the newer information shall be annualized and used, (b) with respect
to each Mortgaged Property, property management fees shall be assumed to be 4%
to 5% of effective gross revenue (except with respect to hospitality properties,
where a minimum of 5% of gross receipts shall be assumed) unless actual
management fees are higher, in which case actual management fees shall be
assumed, (c) assumptions shall be made with respect to reserves for leasing
commission, tenant improvement expenses and capital expenditures and (d)
expenses shall be assumed to include annual replacement reserves equal to (1) in
the case of retail, office, industrial and two mixed use multifamily/retail
properties, not less than $0.04 and not more than $0.77 per square foot net
rentable commercial area, (2) in the case of multifamily and three mixed use
multifamily/retail properties, not less than $150 or more than $350 per
residential unit per year, depending on the condition of the property, (3) in
the case of hospitality properties, 4% of the gross revenues received by the
property owner on an ongoing basis, (4) in the case of residential healthcare
facilities, $225 to $300 per bed per year and (5) in the case of the mobile home
parks, not less than $31 or more than $79 per pad per year. In addition, in some
instances, the Special Servicer may recharacterize as capital expenditures those
items reported by borrowers as operating expenses (thus increasing "net
operating income") where determined appropriate.
E-1-2
<PAGE>
EXHIBIT F
[RESERVED]
F-1
<PAGE>
EXHIBIT G-1
FORM OF TRANSFEROR CERTIFICATE
______ __, 199_
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union - Lehman - Bank of America, Series 1998-C2
Re: First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2,
Class (the "Certificates")
----------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
____________________ (the "Transferor") to _______________________ (the
"Transferee") of a Certificate (the "Transferred Certificate") having an initial
principal balance as of May 28, 1998 (the "Closing Date") of $_____________
evidencing a __% percentage interest in the Class to which it belongs. The
Certificates were issued pursuant to the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of May 1, 1998, among First Union
Commercial Mortgage Securities, Inc., as depositor, First Union National Bank,
as master servicer, CRIIMI MAE Services Limited Partnership, as special servicer
and Norwest Bank Minnesota, National Association, as trustee. All terms used
herein and not otherwise defined shall have the meanings set forth in the
Pooling and Servicing Agreement. The Transferor hereby certifies, represents and
warrants to you, as Certificate Registrar, that:
1. The Transferor is the lawful owner of the Transferred Certificate
with the full right to transfer such Certificate free from any and all
claims and encumbrances whatsoever.
2. Neither the Transferor nor anyone acting on its behalf has (a)
offered, transferred, pledged, sold or otherwise disposed of any
Certificate, any interest in any Certificate or any other similar security
to any person in any manner, (b) solicited any offer to buy or accepted a
transfer, pledge or other disposition of any Certificate, any interest in
any Certificate or any other similar security from any person in any
manner, (c) otherwise approached or negotiated with respect to any
Certificate,
G-1-1
<PAGE>
any interest in any Certificate or any other similar security with any
person in any manner, (d) made any general solicitation by means of general
advertising or in any other manner, or (e) taken any other action, which
(in the case of any of the acts described in clauses (a) through (e)
hereof) would constitute a distribution of any Certificate under the
Securities Act of 1933 (the "Securities Act"), or would render the
disposition of any Certificate a violation of Section 5 of the Securities
Act or any state securities laws, or would require registration or
qualification of any Certificate pursuant to the Securities Act or any
state securities laws.
Very truly yours,
------------------------------
(Transferor)
By:
--------------------------
Name:
------------------------
Title:
-----------------------
G-1-2
<PAGE>
EXHIBIT G-2
FORM OF TRANSFEREE CERTIFICATE
FOR QIBs
______ __, 199_
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union - Lehman - Bank of America, Series 1998-C2
Re: First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2,
Class (the "Certificates")
----------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
____________________ (the "Transferor") to _______________________ (the
"Transferee") of a Certificate (the "Transferred Certificate") having an initial
principal balance as of May 28, 1998 (the "Closing Date") of $_____________
evidencing a __% percentage interest in the Class to which it belongs. The
Certificates were issued pursuant to the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of May 1, 1998, among First Union
Commercial Mortgage Securities, Inc., as depositor, First Union National Bank,
as master servicer, CRIIMI MAE Services Limited Partnership, as special servicer
and Norwest Bank Minnesota, National Association, as trustee. All terms used
herein and not otherwise defined shall have the meanings set forth in the
Pooling and Servicing Agreement. The Transferee hereby certifies, represents and
warrants to you, as Certificate Registrar, that:
1. The Transferee is a "qualified institutional buyer" as that term is
defined in Rule 144A ("Rule 144A") under the Securities Act of 1933 (the
"Securities Act") and has completed one of the forms of certification to
that effect attached hereto as Annex 1 and Annex 2. The Transferee is aware
that the sale to it is being made in reliance on Rule 144A. The Transferee
is acquiring the Transferred Certificate for its own account or for the
account of a qualified institutional buyer, and understands that such
Certificate may be resold, pledged or transferred only (i) to a person
reasonably believed to be a qualified institutional buyer that purchases
for its own account or for the account of a qualified institutional buyer
to whom notice is given that the resale, pledge or transfer is being
G-2-1
<PAGE>
made in reliance on Rule 144A, or (ii) pursuant to another exemption from
registration under the Securities Act.
2. The Transferee has been furnished with all information regarding
(a) the Certificates and distributions thereon, (b) the nature, performance
and servicing of the Mortgage Loans, (c) the Pooling and Servicing
Agreement, and (d) any credit enhancement mechanism associated with the
Certificates, that it has requested.
3. The Transferee understands that it may not sell or otherwise
transfer any portion of its interest in the Transferred Certificate except
in compliance with the provisions of Section 5.02 of the Pooling and
Servicing Agreement, which provisions it has carefully reviewed, and that
the Transferred Certificate will bear legends substantially to the
following effect:
THE CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED OR QUALIFIED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE
SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF
THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE
ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH REGISTRATION OR
QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
- AND -
[NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF
1986 (THE "CODE"), OR TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY
PURCHASING THIS CERTIFICATE ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE
OF, OR WITH ASSETS OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT, WILL BE REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES
DESCRIBED HEREIN.]
- OR -
[NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE
(A) TO ANY EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, INCLUDING
INDIVIDUAL RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS AND COLLECTIVE
INVESTMENT FUNDS AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS, ACCOUNTS OR
ARRANGEMENTS ARE INVESTED, THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE
CODE OF 1986 (THE "CODE") (ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY PERSON WHO IS DIRECTLY OR
INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH INTEREST
G-2-2
<PAGE>
HEREIN ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS
OF A PLAN (INCLUDING, WITHOUT LIMITATION, ANY INSURANCE COMPANY USING
ASSETS IN ITS GENERAL OR SEPARATE ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS"
OF A PLAN) PROVIDED THAT (I) SUCH A TRANSFER MAY BE MADE TO AN INSURANCE
COMPANY GENERAL ACCOUNT IF (i) THIS CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE
RELIEF UNDER SECTION III OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60
("PTE 95-60"), AND (ii) THE CONDITIONS OF SECTIONS I, III AND IV OF PTE
95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER, AND (II) SUCH A TRANSFER
MAY BE MADE WITH RESPECT TO A CLASS H, CLASS J, CLASS K, CLASS L OR CLASS M
CERTIFICATE IF THE TRANSFEREE PROVIDES THE CERTIFICATE REGISTRAR WITH A
CERTIFICATION OF FACTS AND AN OPINION THAT ESTABLISH TO THE REASONABLE
SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH TRANSFER WILL NOT
RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE
OR RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF THE
CODE.]
4. Neither the Transferee nor anyone acting on its behalf has (a)
offered, pledged, sold, disposed of or otherwise transferred any
Certificate, any interest in any Certificate or any other similar security
to any person in any manner, (b) solicited any offer to buy or accept a
pledge, disposition or other transfer of any Certificate, any interest in
any Certificate or any other similar security from any person in any
manner, (c) otherwise approached or negotiated with respect to any
Certificate, any interest in any Certificate or any other similar security
with any person in any manner, (d) made any general solicitation by means
of general advertising or in any other manner, or (e) taken any other
action, that (in the case of any of the acts described in clauses (a)
through (e) above) would constitute a distribution of any Certificate under
the Securities Act, would render the disposition of any Certificate a
violation of Section 5 of the Securities Act or any state securities law or
would require registration or qualification of any Certificate pursuant
thereto. The Transferee will not act, nor has it authorized or will it
authorize any person to act, in any manner set forth in the foregoing
sentence with respect to any Certificate.
G-2-3
<PAGE>
Very truly yours,
-----------------------------------
(Transferee)
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
G-2-4
<PAGE>
ANNEX 1 TO EXHIBIT G-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor] (the
"Transferor") and Norwest Bank Minnesota, National Association, as Certificate
Registrar, with respect to the mortgage pass-through certificate being
transferred (the "Transferred Certificate") as described in the Transferee
Certificate to which this certification relates and to which this certification
is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificate (the "Transferee").
2. The Transferee is a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act of 1933 ("Rule 144A") because
(i) the Transferee owned and/or invested on a discretionary basis $ __________/
______________ in securities (other than the excluded securities referred to
below) as of the end of the Transferee's most recent fiscal year (such amount
being calculated in accordance with Rule 144A) [Transferee must own and/or
invest on a discretionary basis at least $100,000,000 in securities unless
Transferee is a dealer, and, in that case, Transferee must own and/or invest
on, a discretionary basis at least $10,000,000 in securities.] and (ii) the
Transferee satisfies the criteria in the category marked below.
(0) Corporation, etc. The Transferee is a corporation (other than a
bank, savings and loan association or similar institution), business
trust, partnership, or any organization described in Section
501(c)(3) of the Internal Revenue Code of 1986.
(0) Bank. The Transferee (a) is a national bank or a banking institution
organized under the laws of any State, U.S. territory or the
District of Columbia, the business of which is substantially
confined to banking and is supervised by the State or territorial
banking commission or similar official or is a foreign bank or
equivalent institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto, as of a date not
more than 16 months preceding the date of sale of the Certificate in
the case of a U.S. bank, and not more than 18 months preceding such
date of sale for a foreign bank or equivalent institution.
G-2-5
<PAGE>
(0) Savings and Loan. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision over
any such institutions or is a foreign savings and loan association
or equivalent institution and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto, as of a date not
more than 16 months preceding the date of sale of the Certificate in
the case of a U.S. savings and loan association, and not more than
18 months preceding such date of sale for a foreign savings and loan
association or equivalent institution.
(0) Broker-dealer. The Transferee is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
(0) Insurance Company. The Transferee is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State, U.S.
territory or the District of Columbia.
(0) State or Local Plan. The Transferee is a plan established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the
benefit of its employees.
(0) ERISA Plan. The Transferee is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
(0) Investment Advisor. The Transferee is an investment advisor
registered under the Investment Advisers Act of 1940.
(0) Other. (Please supply a brief description of the entity and a
cross-reference to the paragraph and subparagraph under subsection
(a)(1) of Rule 144A pursuant to which it qualifies. Note that
registered investment companies should complete Annex 2 rather than
this Annex 1.)_____________________________________________________
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the
G-2-6
<PAGE>
Transferee, (ii) securities that are part of an unsold allotment to or
subscription by the Transferee, if the Transferee is a dealer, (iii) bank
deposit notes and certificates of deposit, (iv) loan participations, (v)
repurchase agreements, (vi) securities owned but subject to a repurchase
agreement and (vii) currency, interest rate and commodity swaps. For purposes of
determining the aggregate amount of securities owned and/or invested on a
discretionary basis by the Transferee, the Transferee did not include any of the
securities referred to in this paragraph.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Transferee, the Transferee used
the cost of such securities to the Transferee, unless the Transferee reports its
securities holdings in its financial statements on the basis of their market
value, and no current information with respect to the cost of those securities
has been published, in which case the securities were valued at market. Further,
in determining such aggregate amount, the Transferee may have included
securities owned by subsidiaries of the Transferee, but only if such
subsidiaries are consolidated with the Transferee in its financial statements
prepared in accordance with generally accepted accounting principles and if the
investments of such subsidiaries are managed under the Transferee's direction.
However, such securities were not included if the Transferee is a
majority-owned, consolidated subsidiary of another enterprise and the Transferee
is not itself a reporting company under the Securities Exchange Act of 1934.
5. The Transferee acknowledges that it is familiar with Rule 144A and
understands that the parties to which this certification is being made are
relying and will continue to rely on the statements made herein because one or
more sales to the Transferee may be in reliance on Rule 144A.
----- ----- Will the Transferee be purchasing
Yes No the Transferred Certificate only
for the Transferee's own account?
6. If the answer to the foregoing question is "no", then in each case where
the Transferee is purchasing for an account other than its own, such account
belongs to a third party that is itself a "qualified institutional buyer" within
the meaning of Rule 144A, and the "qualified institutional buyer" status of such
third party has been established by the Transferee through one or more of the
appropriate methods contemplated by Rule 144A.
7. The Transferee will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Transferee's purchase of the Transferred
Certificate will constitute a reaffirmation of this certification as of the date
of such purchase. In addition, if the Transferee is a bank or savings
G-2-7
<PAGE>
and loan as provided above, the Transferee agrees that it will furnish to such
parties any updated annual financial statements that become available on or
before the date of such purchase, promptly after they become available.
------------------------
Print Name of Transferee
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
----------------------------------
Date:
-----------------------------------
G-2-8
<PAGE>
ANNEX 2 TO EXHIBIT G-2
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor] (the
"Transferor") and Norwest Bank Minnesota, National Association, as Certificate
Registrar, with respect to the mortgage pass-through certificate being
transferred (the "Transferred Certificate") as described in the Transferee
Certificate to which this certification relates and to which this certification
is an Annex:
1. As indicated below, the undersigned is the chief financial officer, a
person fulfilling an equivalent function, or other executive officer of the
entity purchasing the Transferred Certificate (the "Transferee") or, if the
Transferee is a "qualified institutional buyer" as that term is defined in Rule
144A under the Securities Act of 1933 ("Rule 144A") because the Transferee is
part of a Family of Investment Companies (as defined below), is an executive
officer of the investment adviser (the "Adviser").
2. The Transferee is a "qualified institutional buyer" as defined in
Rule 144A because (i) the Transferee is an investment company registered
under the Investment Company Act of 1940, and (ii) as marked below, the
Transferee alone owned and/or invested on a discretionary basis, or the
Transferee's Family of Investment Companies owned, at least $100,000,000 in
securities (other than the excluded securities referred to below) as of the
end of the Transferee's most recent fiscal year. For purposes of determining
the amount of securities owned by the Transferee or the Transferee's Family
of Investment Companies, the cost of such securities was used, unless the
Transferee or any member of the Transferee's Family of Investment Companies,
as the case may be, reports its securities holdings in its financial
statements on the basis of their market value, and no current information
with respect to the cost of those securities has been published, in which
case the securities of such entity were valued at market.
(0) The Transferee owned and/or invested on a discretionary basis $
in securities (other than the excluded securities referred to
below) as of the end of the Transferee's most recent fiscal year
(such amount being calculated in accordance with Rule 144A).
(0) The Transferee is part of a Family of Investment Companies which
owned in the aggregate $ in securities (other than the
excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
G-2-9
<PAGE>
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Transferee or are part of the Transferee's
Family of Investment Companies, (ii) bank deposit notes and certificates of
deposit, (iii) loan participations, (iv) repurchase agreements, (v) securities
owned but subject to a repurchase agreement and (vi) currency, interest rate and
commodity swaps. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Transferee, or owned by
the Transferee's Family of Investment Companies, the securities referred to in
this paragraph were excluded.
5. The Transferee is familiar with Rule 144A and understands that the
parties to which this certification is being made are relying and will continue
to rely on the statements made herein because one or more sales to the
Transferee will be in reliance on Rule 144A.
----- ----- Will the Transferee be purchasing
Yes No the Transferred Certificate only
for the Transferee's own account?
6. If the answer to the foregoing question is "no", then in each case where
the Transferee is purchasing for an account other than its own, such account
belongs to a third party that is itself a "qualified institutional buyer" within
the meaning of Rule 144A, and the "qualified institutional buyer" status of such
third party has been established by the Transferee through one or more of the
appropriate methods contemplated by Rule 144A.
7. The undersigned will notify the parties to which this certification is
made of any changes in the information and conclusions herein. Until such
notice, the Transferee's purchase of the Transferred Certificate will constitute
a reaffirmation of
G-2-10
<PAGE>
this certification by the undersigned as of the date of such purchase.
-----------------------------------
Print Name of Transferee or Adviser
-----------------------------------
By:
--------------------------------
Name:
Title:
-----------------------------
IF AN ADVISER:
-----------------------------------
Print Name of Transferee
Date:
------------------------------
G-2-11
<PAGE>
EXHIBIT G-3
FORM OF TRANSFEREE CERTIFICATE
FOR NON-QIBs
______ __, 199_
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union - Lehman - Bank of America, Series 1998-C2
Re: First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2,
Class (the "Certificates")
----------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
____________________ by (the "Transferor") to _______________________ (the
"Transferee") of a Certificate (the "Transferred Certificate") having an initial
principal balance as of May 28, 1998 (the "Closing Date") of $_____________
evidencing a __% percentage interest in the Class to which it belongs. The
Certificates were issued pursuant to the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of May 1, 1998, among First Union
Commercial Mortgage Securities, Inc., as depositor (the "Depositor"), First
Union National Bank, as master servicer, CRIIMI MAE Services Limited
Partnership, as special servicer and Norwest Bank Minnesota, National
Association, as trustee. All terms used herein and not otherwise defined shall
have the meanings set forth in the Pooling and Servicing Agreement. The
Transferee hereby certifies, represents and warrants to you, as Certificate
Registrar, that:
1. The Transferee is acquiring the Transferred Certificate for its own
account for investment and not with a view to or for sale or transfer in
connection with any distribution thereof, in whole or in part, in any manner
which would violate the Securities Act of 1933, as amended (the "Securities
Act"), or any applicable state securities laws.
2. The Transferee understands that (a) the Certificates have not been and
will not be registered under the Securities Act or registered or qualified under
any applicable state securities laws, (b) neither the Depositor nor the Trustee
or the Certificate Registrar is obligated so to register or qualify the
Certificates and (c) the Certificates may not be resold or transferred unless
they are (i) registered pursuant to
G-3-1
<PAGE>
the Securities Act and registered or qualified pursuant to any applicable state
securities laws or (ii) sold or transferred in transactions which are exempt
from such registration and qualification and the Certificate Registrar has
received either (A) certifications from both the transferor and the transferee
(substantially in the forms attached to the Pooling and Servicing Agreement)
setting forth the facts surrounding the transfer or (B) an opinion of counsel
satisfactory to the Certificate Registrar with respect to the availability of
such exemption (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Master Servicer, the Special Servicer, the Trustee
or the Certificate Registrar in their respective capacities as such), together
with copies of the certification(s) from the Transferor and/or Transferee
setting forth the facts surrounding the transfer upon which such opinion is
based. Any holder of a Certificate desiring to effect such a transfer shall, and
upon acquisition of such Certificate shall be deemed to have agreed to,
indemnify the Trustee, the Certificate Registrar and the Depositor against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
3. The Transferee understands that it may not sell or otherwise transfer
any portion of its interest in the Transferred Certificate except in compliance
with the provisions of Section 5.02 of the Pooling and Servicing Agreement,
which provisions it has carefully reviewed, and that the Transferred Certificate
will bear legends substantially to the following effect:
THE CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION
WHICH DOES NOT REQUIRE SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH
THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
- AND -
[NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT THAT IS SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL REVENUE CODE OF 1986
(THE "CODE"), OR TO ANY PERSON WHO IS DIRECTLY OR INDIRECTLY PURCHASING THIS
CERTIFICATE ON BEHALF OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS
OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT, WILL BE
REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.]
- OR -
[NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE (A) TO
ANY EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
G-3-2
<PAGE>
ARRANGEMENT, INCLUDING INDIVIDUAL RETIREMENT ACCOUNTS AND ANNUITIES, KEOGH PLANS
AND COLLECTIVE INVESTMENT FUNDS AND SEPARATE ACCOUNTS IN WHICH SUCH PLANS,
ACCOUNTS OR ARRANGEMENTS ARE INVESTED, THAT IS SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE") (ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT, A "PLAN"), OR (B) TO ANY PERSON WHO IS DIRECTLY OR
INDIRECTLY PURCHASING THIS CERTIFICATE OR SUCH INTEREST HEREIN ON BEHALF OF, AS
NAMED FIDUCIARY OF, AS TRUSTEE OF, OR WITH ASSETS OF A PLAN (INCLUDING, WITHOUT
LIMITATION, ANY INSURANCE COMPANY USING ASSETS IN ITS GENERAL OR SEPARATE
ACCOUNT THAT MAY CONSTITUTE "PLAN ASSETS" OF A PLAN) PROVIDED THAT (I) SUCH A
TRANSFER MAY BE MADE TO AN INSURANCE COMPANY GENERAL ACCOUNT IF (i) THIS
CERTIFICATE IS ELIGIBLE FOR EXEMPTIVE RELIEF UNDER SECTION III OF PROHIBITED
TRANSACTION CLASS EXEMPTION 95-60 ("PTE 95-60"), AND (ii) THE CONDITIONS OF
SECTIONS I, III AND IV OF PTE 95-60 ARE SATISFIED WITH RESPECT TO SUCH TRANSFER,
AND (II) SUCH A TRANSFER MAY BE MADE WITH RESPECT TO A CLASS H, CLASS J, CLASS
K, CLASS L OR CLASS M CERTIFICATE IF THE TRANSFEREE PROVIDES THE CERTIFICATE
REGISTRAR WITH A CERTIFICATION OF FACTS AND AN OPINION THAT ESTABLISH TO THE
REASONABLE SATISFACTION OF THE CERTIFICATE REGISTRAR THAT SUCH TRANSFER WILL NOT
RESULT IN A VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR
RESULT IN THE IMPOSITION OF AN EXCISE TAX UNDER SECTION 4975 OF THE CODE.]
4. Neither the Transferee nor anyone acting on its behalf has (a) offered,
pledged, sold, disposed of or otherwise transferred any Certificate, any
interest in any Certificate or any other similar security to any person in any
manner, (b) solicited any offer to buy or accept a pledge, disposition or other
transfer of any Certificate, any interest in any Certificate or any other
similar security from any person in any manner, (c) otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate or
any other similar security with any person in any manner, (d) made any general
solicitation by means of general advertising or in any other manner, or (e)
taken any other action, that (in the case of any of the acts described in
clauses (a) through (e) above) would constitute a distribution of any
Certificate under the Securities Act, would render the disposition of any
Certificate a violation of Section 5 of the Securities Act or any state
securities law or would require registration or qualification of any Certificate
pursuant thereto. The Transferee will not act, nor has it authorized or will it
authorize any person to act, in any manner set forth in the foregoing sentence
with respect to any Certificate.
G-3-3
<PAGE>
5. The Transferee has been furnished with all information regarding (a) the
Depositor, (b) the Certificates and distributions thereon, (c) the Pooling and
Servicing Agreement, and (d) all related matters, that it has requested.
6. The Transferee is an "accredited investor" as defined in Rule 501(a)(1),
(2), (3) or (7) under the Securities Act and has such knowledge and experience
in financial and business matters as to be capable of evaluating the merits and
risks of an investment in the Certificates; the Transferee has sought such
accounting, legal and tax advice as it has considered necessary to make an
informed investment decision; and the Transferee is able to bear the economic
risks of such an investment and can afford a complete loss of such investment.
Very truly yours,
---------------------------------
(Transferee)
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
G-3-4
<PAGE>
EXHIBIT H
FORM OF TRANSFEREE LETTER
_____ __, 199_
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union-Lehman-Bank of America, Series 1998-C2
Re: First Union-Lehman Brothers-Bank of America,
Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2,
Classes (the "Certificates")
----------------------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
____________________ (the "Transferor") to _______________________ (the
"Transferee") of the Class ______________ Certificates (the "Transferred
Certificate") (having principal balances as of May 28, 1998 (the "Closing Date")
of $_____________ evidencing a __% interest in the Classes to which they
belong]. The Certificates were issued pursuant to a Pooling and Servicing
Agreement, dated as of May 1, 1998 (the "Pooling and Servicing Agreement"),
among First Union Commercial Mortgage Securities, Inc., as depositor, First
Union National Bank, as master servicer, CRIIMI MAE Services Limited
Partnership, as special servicer and Norwest Bank Minnesota, National
Association, as trustee (the "Trustee"). Capitalized terms used but not defined
herein shall have the meanings set forth in the Pooling and Servicing Agreement.
The Transferee hereby certifies, represents and warrants to you that:
Either: (1) the Transferee is not an employee benefit plan within the
meaning of section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA") (a "Plan"), or a plan within the meaning of section
4975(e)(1) of the Internal Revenue Code of 1986, as amended (the "Code") (also,
a "Plan"), and the Transferee is not directly or indirectly purchasing the
Transferred Certificate on behalf of, as investment manager of, as named
fiduciary of, as trustee of, or with assets of a Plan (including any insurance
company using assets in its general or separate account that may constitute
assets of a Plan); or (2) the Transferee's purchase of the Transferred
Certificate will not result in a prohibited transaction under section 406 of
ERISA or section 4975 of the Code or subject the Master Servicer, the Special
Servicer or the
H-1
<PAGE>
Trustee to any obligation in addition to those undertaken in the Pooling
and Servicing Agreement.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of the
date first written above.
[Name of Transferee]
By:
--------------------------
Name:
------------------------
Title:
-----------------------
H-2
<PAGE>
EXHIBIT I-1
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
PURSUANT TO SECTION 5.02(d)(i)(B)
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
[NAME OF OFFICER], being first duly sworn, deposes, and represents and
warrants:
1. That he is a [Title of Officer] of [Name of Owner] (the "Owner"), a
corporation duly organized and existing under the laws of the [State of
___________] [the United States], and the owner of the First Union
Commercial Mortgage Securities, Inc., Commercial Mortgage Pass-Through
Certificates, Series 1998-C2, Class [R-I, R-II, R-III] evidencing a ___%
Percentage Interest (the "Class [R-I, R-II, R-III] Certificates").
Capitalized terms used but not defined herein have the meanings assigned to
such terms in the Pooling and Servicing Agreement dated as of May 1, 1998,
among First Union Commercial Mortgage Securities, Inc., as Depositor, First
Union National Bank as Master Servicer, CRIIMI MAE Services Limited
Partnership, as Special Servicer and Norwest Bank Minnesota, National
Association.
2. That the Owner (i) is and will be a "Permitted Transferee" as of
_____ _, 199_ and (ii) is acquiring the Class [R-I, R-II, R-III]
Certificates for its own account or for the account of another Owner from
which it has received an affidavit in substantially the same form as this
affidavit. A "Permitted Transferee" is any person other than a
"disqualified organization" or a Non-United States Person. For this
purpose, a "disqualified organization" means any of the following: (i) the
United States, any State or political subdivision thereof, any possession
of the United States, or any agency or instrumentality of any of the
foregoing (other than an instrumentality which is a corporation if all of
its activities are subject to tax and, except of the FHLMC, a majority of
its board of directors is not selected by such governmental unit), (ii) a
foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers' cooperatives described in Section 521 of the Code) which
is exempt from the tax imposed by Chapter 1 of the Code (unless such
organization is subject to the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section
I-1-1
<PAGE>
1381(a)(2)(C) of the Code and (v) any other Person so designated by the
Trustee based upon an Opinion of Counsel that the holding of an Ownership
Interest in a Class [R-I, R-II, R-III] Certificate by such Person may cause
the Trust Fund or any Person having an Ownership Interest in any Class of
Certificates, other than such Person, to incur a liability for any federal
tax imposed under the Code that would not otherwise be imposed but for the
Transfer of an Ownership Interest in a Class [R-I, R-II, R-III] Certificate
to such Person. The terms "United States", "State" and "international
organization" shall have the meanings set forth in Section 7701 of the Code
or successor provisions.
A "Non-United States Person" is any Person other than a United States
Person. A "United States Person" is a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in,
or under the laws of, the United States or any political subdivision
thereof, an estate whose income from sources without the United States is
includible in gross income for United States federal income tax purposes
regardless of its connection with the conduct of a trade or business within
the United States, or a trust if a court within the United States is able
to exercise primary supervision over the administration of the trust and
one or more United States persons have the authority to control all
substantial decisions of the trust, all within the meaning of Section 7701
of the Code.
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of the Class [R-I, R-II, R-III] Certificates to disqualified
organizations under the Code that applies to all transfers of the Class
[R-I, R-II, R-III] Certificates after March 31, 1988; (ii) that such tax
would be on the transferor, or, if such transfer is through an agent (which
person includes a broker, nominee or middleman) for a disqualified
organization Transferee, on the agent; (iii) that the person otherwise
liable for the tax shall be relieved of liability for the tax if the
transferee furnishes to such person an affidavit that the transferee is not
a disqualified organization and, at the time of transfer, such person does
not have actual knowledge that the affidavit is false; and (iv) that the
Class [R-I, R-II, R-III] Certificates may be "noneconomic residual
interests" within the meaning of Treasury regulation section 1.860E-1(c)(2)
and that the transferor of a "noneconomic residual interest" will remain
liable for any taxes due with respect to the income on such residual
interest, unless no significant purpose of the transfer is to enable the
transferor to impede the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding the Class [R-I, R-II, R-III] Certificates if at any time
during the taxable year of the
I-1-2
<PAGE>
pass-through entity a non-Permitted Transferee is the record holder of an
interest in such entity. For this purpose, a "pass through entity" includes
a regulated investment company, a real estate investment trust or common
trust fund, a partnership, trust or estate, and certain cooperatives.
5. That the Owner is aware that the Certificate Registrar will not
register the transfer of any Class [R-I, R-II, R-III] Certificate unless
the transferee, or the transferee's agent, delivers to the Trustee, among
other things, an affidavit in substantially the same form as this
affidavit. The Owner expressly agrees that it will not consummate any such
transfer if it knows or believes that any of the representations contained
in such affidavit and agreement are false.
6. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to
constitute a reasonable arrangement to ensure that the Class [R-I, R-II,
R-III] Certificates will only be owned, directly or indirectly, by
Permitted Transferees.
7. That the Owner's taxpayer identification number is _____________.
8. That the Owner has reviewed the restrictions set forth on the face
of the Class [R-I, R-II, R-III] Certificates and the provisions of Section
5.02 of the Pooling and Servicing Agreement under which the Class [R-I,
R-II, R-III] Certificates were issued (and, in particular, the Owner is
aware that such Section authorizes the Trustee to deliver payments to a
person other than the Owner and negotiate a mandatory sale by the Trustee
in the event that the Owner holds such Certificate in violation of Section
5.02); and that the Owner expressly agrees to be bound by and to comply
with such restrictions and provisions.
9. That the Owner is not acquiring and will not transfer the Class
[R-I, R-II, R-III] Certificates in order to impede the assessment or
collection of any tax.
10. That the Owner anticipates that it will, so long as it holds any
of the Class [R-I, R-II, R-III] Certificates, have sufficient assets to pay
any taxes owed by the holder of such Class [R-I, R-II, R-III] Certificates.
11. That the Owner has no present knowledge that it may become
insolvent or subject to a bankruptcy proceeding for so long as it holds any
of the Class [R-I, R-II, R-III] Certificates.
I-1-3
<PAGE>
12. That the Owner has no present knowledge or expectation that it
will be unable to pay any United States taxes owed by it so long as any of
the Certificates remain outstanding. In this regard, the Owner hereby
represents to and for the benefit of the Person from whom it acquired the
Class [R-I, R-II, R-III] Certificates that the Owner intends to pay taxes
associated with holding the Class [R-I, R-II, R-III] Certificates as they
become due, fully understanding that it may incur tax liabilities in excess
of any cash flows generated by the Class [R-I, R-II, R-III] Certificates.
13. That the Owner is not acquiring the Class [R-I, R-II, R-III]
Certificates with the intent to transfer any of the Class [R-I, R-II,
R-III] Certificates to any person or entity that will not have sufficient
assets to pay any taxes owed by the holder of such Class [R-I, R-II, R-III]
Certificates, or that may become insolvent or subject to a bankruptcy
proceeding, for so long as the Class [R-I, R-II, R-III] Certificates remain
outstanding.
14. That Owner will, in connection with any transfer that it makes of
the Class [R-I, R-II, R-III] Certificates, obtain from its transferee the
representations required by Section 5.02(d) of the Pooling and Servicing
Agreement under which the Class [R-I, R-II, R-III] Certificates were issued
and will not consummate any such transfer if it knows, or knows facts that
should lead it to believe, that any such representations are false.
15. That Owner will, in connection with any transfer that it makes of
any Class [R-I, R-II, R-III] Certificate, deliver to the Certificate
Registrar an affidavit, which represents and warrants that it is not
transferring such Class [R-I, R-II, R-III] Certificate to impede the
assessment or collection of any tax and that it has no actual knowledge
that the proposed transferee: (i) has insufficient assets to pay any taxes
owed by such transferee as holder of such Class [R-I, R-II, R-III]
Certificate; (ii) may become insolvent or subject to a bankruptcy
proceeding, for so long as the Class [R-I, R-II, R-III] Certificates remain
outstanding; and (iii) is not a "Permitted Transferee".
I-1-4
<PAGE>
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed on
its behalf, by its [Title of Officer] and Authorized Signatory, attested by its
Assistant Secretary, this ____ day of _____, 199_.
[NAME OF OWNER]
By:
------------------------
[Name of Officer]
[Title of Officer]
- -------------------------------
[Assistant] Secretary
Personally appeared before me the above-named [Name of Officer], known or
proved to me to be the same person who executed the foregoing instrument and to
be [Title of Officer], and acknowledged to me that he executed the same as his
free act and deed and the free act and deed of the Owner.
Subscribed and sworn before me this ____ day of _____ 199.
/s/
-----------------------------------
NOTARY PUBLIC
COUNTY OF
--------------
STATE OF
---------------
My Commission expires the
____ day of ___________, 19__.
I-1-5
<PAGE>
EXHIBIT I-2
FORM OF TRANSFEROR CERTIFICATE
PURSUANT TO SECTION 5.02(d)(i)(D)
__________, 199__
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union - Lehman - Bank of America, Series 1998-C2
Re: First Union-Lehman Brothers, Commercial
Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 1998-C2, Class [R-I, R-II, R-
III], evidencing a ____% percentage interest in
the Class to which they belong
--------------------------------------------------
Dear Sirs:
This letter is delivered to you in connection with the transfer by
____________________________________ (the "Transferor") to
______________________________________________ (the "Transferee") of the
captioned Class [R-I, R-II, R-III] Certificates (the "Class [R-I, R-II, R-III]
Certificates"), pursuant to Section 5.02 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of May 1, 1998, among First
Union Commercial Mortgage Securities, Inc., as depositor, First Union National
Bank, as master servicer, CRIIMI MAE Services Limited Partnership, as special
servicer, Norwest Bank Minnesota and National Association, as trustee. All terms
used herein and not otherwise defined shall have the meanings set forth in the
Pooling and Servicing Agreement. The Transferor hereby represents and warrants
to you, as Certificate Registrar, that:
I-2-1
<PAGE>
1. No purpose of the Transferor relating to the transfer of the Class [R-I,
R-II, R-III] Certificates by the Transferor to the Transferee is or will be to
impede the assessment or collection of any tax.
2. The Transferor understands that the Transferee has delivered to you a
Transfer Affidavit and Agreement in the form attached to the Pooling and
Servicing Agreement as Exhibit I-1. The Transferor does not know or believe that
any representation contained therein is false.
3. The Transferor has at the time of this transfer conducted a reasonable
investigation of the financial condition of the Transferee as contemplated by
Treasury regulation section 1.860E-1(c)(4)(i) and, as a result of that
investigation, the Transferor has determined that the Transferee has
historically paid its debts as they became due and has found no significant
evidence to indicate that the Transferee will not continue to pay its debts as
they become due in the future. The Transferor understands that the transfer of
the Class [R-I, R-II, R-III] Certificates may not be respected for United States
income tax purposes (and the Transferor may continue to be liable for United
States income taxes associated therewith) unless the Transferor has conducted
such an investigation.
Very truly yours,
By:
------------------------
Name:
Title:
I-2-2
<PAGE>
EXHIBIT J-1
FORM OF NOTICE AND ACKNOWLEDGMENT
__________, 199__
Moody's Investors Service, Inc.
99 Church Street
New York, New York
Standard & Poor's Ratings Services,
a division of the McGraw Hill
Companies, Inc.
25 Broadway
New York, New York 10004
Ladies and Gentlemen:
This notice is being delivered pursuant to Section 6.09 of the Pooling and
Servicing Agreement dated as of May 1, 1998 relating to First Union-Lehman
Brothers-Bank of America, Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2 (the "Agreement"). Any term with
initial capital letters not otherwise defined in this notice has the meaning
given such term in the Agreement.
Notice is hereby given that the Holders of Certificates evidencing a
majority of the Voting Rights allocated to the Controlling Class have designated
___________________ to serve as the Special Servicer under the Agreement.
The designation of ____________________ as Special Servicer will become
final if certain conditions are met and on the date you will deliver to Norwest
Bank Minnesota, National Association, the trustee under the Agreement (the
"Trustee"), a written confirmation stating that the appointment of the person
designated to become the Special Servicer will not result in the qualification,
downgrading or withdrawal of the rating or ratings assigned to one or more
Classes of the Certificates.
J-1-1
<PAGE>
Please acknowledge receipt of this notice by signing the enclosed copy of
this notice where indicated below and returning it to the Trustee, in the
enclosed stamped self-addressed envelope.
Very truly yours,
Norwest Bank Minnesota, National
Association
By:
----------------------------------
Title:
-------------------------------
J-1-2
<PAGE>
Receipt acknowledged:
<TABLE>
<CAPTION>
Standard & Poor's
Ratings Services, a
division of the
Moody's Investor McGraw Hill
Service, Inc. Companies, Inc.
<S> <C>
By: By:
----------------- -----------------
Title: Title:
-------------- --------------
Date: Date:
--------------- ---------------
</TABLE>
J-1-3
<PAGE>
EXHIBIT J-2
FORM OF ACKNOWLEDGMENT OF PROPOSED SPECIAL SERVICER
________, 199___
Norwest Bank Minnesota, National Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
Attn: First Union - Lehman - Bank of America, Series 1998-C2
Ladies & Gentlemen:
Pursuant to Section 6.09 of the Pooling and Servicing Agreement dated as of
May 1, 1998 relating to First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates, Series 1998-C2
(the "Agreement"), the undersigned hereby agrees with all the other parties to
the Agreement that the undersigned shall serve as Special Servicer under, and as
defined in, the Agreement. The undersigned hereby acknowledges that, as of the
date hereof, it is and shall be a party to the Agreement and bound thereby to
the full extent indicated therein in the capacity of Special Servicer. The
undersigned hereby makes, as of the date hereof, the representations and
warranties set forth in Section 3.23(b) as if it were the Special Servicer
thereunder.
-----------------------------
By:
-------------------------
Name:
------------------------
Title:
-----------------------
J-2-1
<PAGE>
EXHIBIT K
Uniform Commercial Code - FINANCING STATEMENT - Form UCC-1
TO BE FILED IN NORTH CAROLINA
K-1
<PAGE>
EXHIBIT A
TO FINANCING STATEMENT
This Exhibit A is attached to financing statement and incorporated in a
financing statement pertaining to FIRST UNION COMMERCIAL MORTGAGE SECURITIES,
INC., as Depositor (referred to as the "Debtor" for the purpose of this
financing statement only), and Norwest Bank Minnesota, National Association, as
trustee for the holders of the Series 1998-C2 Certificates (referred to as the
"Secured Party" for purposes of this financing statement only), under that
certain Pooling and Servicing Agreement dated as of May 1, 1998 (the "Pooling
and Servicing Agreement"), among the Debtor, First Union National Bank, as
master servicer (in such capacity, the "Master Servicer"), CRIIMI MAE Services
Limited Partnership, as special servicer (in such capacity, the "Special
Servicer"), and the Secured Party, relating to the issuance of the Debtor's
Mortgage Pass-Through Certificates, Class A-1, Class A-2, Class IO, Class B,
Class C, Class D, Class E, Class F, Class G, Class H, Class J, Class K, Class L,
Class M, Class N, Class R-I, Class R-II and Class R-III Series 1998-C2
(collectively, the "Series 1998-C2 Certificates"). Capitalized terms used herein
and not defined shall have the respective meanings given to them in the Pooling
and Servicing Agreement. The attached financial statement covers all of the
Debtor's right (including the power to convey title thereto), title and interest
in and to the Trust Fund created by the Pooling and Servicing Agreement,
consisting of the following:
1. The mortgage notes or other evidence of indebtedness of a borrower
(the "Mortgage Notes") with respect to the mortgage loans (the "Mortgage
Loans") listed on the Mortgage Loan Schedule to the Pooling and Servicing
Agreement, which Mortgage Loan Schedule is attached hereto as Exhibit C;
2. The related mortgages, deeds of trust or other similar instruments
securing such Mortgage Notes (the "Mortgages");
3. With respect to each Mortgage Note and each Mortgage, each other
document in the related Mortgage File;
4. (a) the Certificate Account created by the Master Servicer pursuant
to the Pooling and Servicing Agreement, (b) all funds from time to time on
deposit in the Certificate Account, (c) the investments of any such funds
consisting of securities, instruments or other obligations (including the
Permitted Investments described on Exhibit B hereto), and (d) the general
intangibles consisting of the contractual right to payment, including the
right to payments of principal and interest and the right to enforce the
related payment obligations, arising from or under any such investments;
K-2
<PAGE>
5. All REO Property;
6. (a) the REO Account required to be maintained by the Special
Servicer pursuant to the Pooling and Servicing Agreement, (b) all funds
from time to time on deposit in the REO Account, (c) the investments of any
such funds consisting of securities, instruments or other obligations
(including the Permitted Investments described on Exhibit B hereto), and
(d) the general intangibles consisting of the contractual right to payment,
including the right to payments of principal and interest and the right to
enforce the related payment obligations, arising from or under any such
investments;
7. (a) the Reserve Account(s) and the Servicing Accounts maintained by
the Master Servicer or Special Servicer pursuant to the Pooling and
Servicing Agreement, (b) all funds from time to time on deposit in the
Reserve Account(s) or the Servicing Accounts, (c) the investments of any
such funds consisting of securities, instruments or other obligations
(including the Permitted Investments described on Exhibit B hereto), and
(d) the general intangibles consisting of the contractual right to payment,
including the right to payments of principal and interest and the right to
enforce the related payment obligations, arising from or under any such
investments;
8. (a) the Distribution Account created by the Trustee pursuant to the
Pooling and Servicing Agreement, (b) all funds from time to time on deposit
in the Distribution Account, (c) the investments of any such funds
consisting of securities, instruments or other obligations (including the
Permitted Investments described on Exhibit B hereto), and (d) the general
intangibles consisting of the contractual right to payment, including the
right to payments of principal and interest and the right to enforce the
related payment obligations, arising from or under any such investments;
9. All insurance policies, including the right to payments thereunder,
with respect to the Mortgage Loans required to be maintained pursuant to
the Pooling and Servicing Agreements, transferred to the Trust Fund and to
be serviced by the Master Servicer or Special Servicer; and
10. All income, payments, products and proceeds of any of the
foregoing, together with any additions thereto or substitutions therefor.
THE DEBTOR AND THE SECURED PARTY INTEND THE TRANSACTIONS CONTEMPLATED BY
THE POOLING AND SERVICING AGREEMENT TO CONSTITUTE A SALE OF THE INTEREST IN THE
MORTGAGE NOTES, THE RELATED MORTGAGES AND THE OTHER DOCUMENTS IN THE RELATED
MORTGAGE FILES EVIDENCED BY THE SERIES 1998-C2 CERTIFICATES, AND THIS FILING
K-3
<PAGE>
SHOULD NOT BE CONSTRUED AS A CONCLUSION THAT A SALE HAS NOT OCCURRED. THE
REFERENCES HEREIN TO MORTGAGE NOTES SHOULD NOT BE CONSTRUED AS A CONCLUSION THAT
ANY MORTGAGE NOTE IS NOT AN INSTRUMENT WITHIN THE MEANING OF THE UNIFORM
COMMERCIAL CODE OR THAT A FILING IS NECESSARY TO PERFECT THE OWNERSHIP OR
SECURITY INTEREST OF THE SECURED PARTY IN ANY MORTGAGE NOTE, MORTGAGE OR OTHER
DOCUMENT IN A MORTGAGE FILE. IN ADDITION, THE REFERENCES HEREIN TO SECURITIES,
INSTRUMENTS AND OTHER OBLIGATIONS (INCLUDING, WITHOUT LIMITATION, PERMITTED
INVESTMENTS) SHOULD NOT BE CONSTRUED AS A CONCLUSION THAT ANY SECURITY,
INSTRUMENT OR OTHER OBLIGATION (INCLUDING, WITHOUT LIMITATION, ANY PERMITTED
INVESTMENT) IS NOT AN INSTRUMENT, A CERTIFICATED SECURITY OR AN UNCERTIFICATED
SECURITY WITHIN THE MEANING OF THE UNIFORM COMMERCIAL CODE, AS IN EFFECT IN ANY
APPLICABLE JURISDICTION, NOR SHOULD THIS FINANCIAL STATEMENT BE CONSTRUED AS A
CONCLUSION THAT A FILING IS NECESSARY TO PERFECT THE OWNERSHIP OR SECURITY
INTEREST OF THE SECURED PARTY IN THE CONTRACTUAL RIGHT TO PAYMENT, INCLUDING THE
RIGHT TO PAYMENTS OF PRINCIPAL AND INTEREST AND THE RIGHT TO ENFORCE THE RELATED
PAYMENT OBLIGATIONS, ARISING FROM OR UNDER ANY SECURITY, INSTRUMENT OR OTHER
OBLIGATION (INCLUDING, WITHOUT LIMITATION, ANY PERMITTED INVESTMENT). WITH
RESPECT TO THE FOREGOING, THIS FILING IS MADE ONLY IN THE EVENT OF CONTRARY
ASSERTIONS BY THIRD PARTIES.
K-4
<PAGE>
EXHIBIT B
"Permitted Investments": Any one or more of the following obligations or
securities (including obligations or securities of the Trustee if otherwise
qualifying hereunder):
(i) direct obligations of, or obligations fully guaranteed as
to timely payment of principal and interest by, the United
States or any agency or instrumentality thereof (having
original maturities of not more than 365 days), provided
such obligations are backed by the full faith and credit
of the United States. Such obligations must be limited to
those instruments that have a predetermined fixed dollar
amount of principal due at maturity that cannot vary or
change. If rated, such an obligation must not have an "r"
highlighter affixed to its rating by Standard & Poor's.
Interest may either by fixed or variable. If such interest
is variable, interest must be tied to a single interest
rate index plus a single fixed spread (if any), and move
proportionately with that index;
(ii) repurchase obligations with respect to any security
described in clause (i) above (having original maturities
of not more than 365 days), provided that the short-term
deposit or debt obligations, of the party agreeing to
repurchase such obligations are rated in the highest
rating category of each of DCR, if rated by DCR, Moody's
and Standard & Poor's or such lower rating as will not
result in qualification, downgrading or withdrawal of the
ratings then assigned to the Certificates, as evidenced in
writing by the Rating Agencies. In addition, any such item
must not have an "r" highlighter affixed to its rating by
Standard & Poor's, and its terms must have a predetermined
fixed dollar amount of principal due at maturity that
cannot very or change. Interest may either by fixed or
variable. If such interest is variable, interest must be
tied to a single interest rate index plus a single fixed
spread (if any), and move proportionately with that index.
(iii) certificates of deposit, time deposits, demand deposits
and bankers' acceptances of any bank or trust company
organized under the laws of the United States or any state
thereof (having original maturities of not more than 365
days), the short term obligations of which are rated in
the highest rating category of each of DCR, if rated by
DCR, Moody's and Standard & Poor's or
K-5
<PAGE>
such lower rating as will not result in qualification,
downgrading or withdrawal of the ratings then assigned to
the Certificates, as evidenced in writing by the Rating
Agencies. In addition, any such item must not have an "r"
highlighter affixed to its rating by Standard & Poor's,
and its terms should have a predetermined fixed dollar
amount of principal due at maturity that cannot vary or
change. Interest may either be fixed or variable. If such
interest is variable, interest must be tied to a single
interest rate index plus a single fixed spread (if any),
and move proportionately with that index.
(iv) commercial paper (having original maturities of not more
than 365 days) of any corporation incorporated under the
laws of the United States or any state thereof (or if not
so incorporated, the commercial paper is United States
Dollar denominated and amounts payable thereunder are not
subject to any withholding imposed by any non-United
States jurisdiction) which is rated in the highest rating
category of each of DCR, if rated by DCR, Moody's and
Standard & Poor's or such lower rating as will not result
in qualification, downgrading or withdrawal of the ratings
then assigned to the Certificates, as evidenced in writing
by the Rating Agencies. The commercial paper should not
have an "r" highlighter affixed to its rating by Standard
& Poor's and by its terms must have a predetermined fixed
dollar amount of principal due at maturity that cannot
vary or change. Interest may either by fixed or variable.
If such interest is variable, interest must be tied to a
single interest rate index plus a single fixed spread (if
any), and move proportionately with that index.
(v) units of money market funds rated in the highest rating
category of DCR and Moody's and AAAm or AAAm-G by Standard
& Poor's (or such lower rating as will not result in
qualification, downgrading or withdrawal of the ratings
then assigned to the Certificates, as evidenced in writing
by the Rating Agencies) and which seeks to maintain a
constant net asset value;
(vi) any other obligation or security acceptable to each Rating
Agency, evidence of which acceptability shall be provided
in writing by each Rating Agency to the Master Servicer,
the Special Servicer and the Trustee;
K-6
<PAGE>
provided that (1) no investment described hereunder shall evidence either the
right to receive (x) only interest with respect to such investment or (y) a
yield to maturity greater than 120% of the yield to maturity at par of the
underlying obligations; and (2) that no investment described hereunder may be
purchased at a price greater than par if such investment may be prepaid or
called at a price less than its purchase price prior to stated maturity.
K-7
<PAGE>
EXHIBIT L
Form of Schedule of Certificateholders
<TABLE>
<CAPTION>
Initial
Class Certificate Balance Name of Holder Address
----- ------------------- -------------- -------
<S> <C> <C> <C>
</TABLE>
L-1
<PAGE>
EXHIBIT M
Form of CSSA Property File Report
<TABLE>
<CAPTION>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- -------------------------------------------------------------- ----------------------------------------------------
FIELD FORMAT
FIELD NAME NUMBER TYPE EXAMPLE
- -------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C>
Transaction Id 1 AN XXX97001
Loan ID 2 AN XXX9701A
Prospectus Loan ID 3 AN 00000000012345
Property ID 4 AN 1001-001
Distribution Date 5 AN YYYYMMDD
Cross-Collateralized Loan Grouping 6 Numeric 9(3)
Property Name 7 AN Text
Property Address 8 AN Text
Property City 9 AN Text
Property State 10 AN FL
Property Zip Code 11 AN 30303
Property County 12 AN Text
Property Type Code 13 AN MF
Year Built 14 AN YYYY
Year Last Renovated 15 AN YYYY
Net Square Feet At Securitization 16 Numeric 25000
# Of Units/Beds/Rooms At Securitization 17 Numeric 75
Property Status 18 AN 1
Allocated Percentage of Loan at Securitization 19 Numeric 0.75
Current Allocated Percentage 20 Numeric 0.75
Current Allocated Loan Amount 21 Numeric 5900900
Ground Lease (Y/S/N) 22 AN N
Other Escrow / Reserve Balances 23 Numeric 25000
Most Recent Appraisal Date 24 AN YYYYMMDD
Most Recent Appraisal Value 25 Numeric 1000000
Date Asset is Expected to Be Resolved 26 AN YYYYMMDD
Foreclosure Date 27 AN YYYYMMDD
- -------------------------------------------------------------- ----------------------------------------------------
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
FIELD CSSA
NUMBER DESCRIPTION/COMMENTS LOAN
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1 S1,P1
2 S3,P3
3 From Offering Document S4,P4
4 Should contain Prospectus ID and propety identifier, e.g., 1001-001, 1000-002
5 P5
6 All Loans With The Same Numeric Value Are Crossed S75
7 S55
8 S56
9 S57
10 S58
11 S59
12 S60
13 S61
14 S64
15 P80
16 RT, IN, WH, OF, MU, SS,OT = SF S62
17 MF, MHP, LO, HC = Units S63
18 1=FCL, 2=REO, 3=Defeased, 4=Partial Release, 5= Released, 6= Same as at securitization
19 Issuer to allocate loan % attributable to property for multi-property loans
20 Calculation based on Current Allocated Loan Amount and Current SPB for associated loan.
21 Maintained by servicer. P7
22 Either Y=Yes, S=Subordinate, N= No ground lease S74
23 S77
24 P74
25 P75
26 Could be different dates for different properties if foreclosing P79
27 P42
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 1 of 9
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- -------------------------------------------------------------- ----------------------------------------------------
FIELD FORMAT
FIELD NAME NUMBER TYPE EXAMPLE
- -------------------------------------------------------------- ----------------------------------------------------
<S> <C> <C> <C>
REO Date 28 AN YYYYMMDD
Occupancy % 29 Numeric 0.75
Occupancy Date 30 Numeric YYYYMMDD
Date Lease Rollover Review 31 AN YYYYMMDD
% Sq. Feet expiring 1-12 months 32 Numeric 0.20
% Sq. Feet expiring 13-24 months 33 Numeric 0.20
% Sq. Feet expiring 25-36 months 34 Numeric 0.20
% Sq. Feet expiring 37-48 months 35 Numeric 0.20
% Sq. Feet expiring 49-60 months 36 Numeric 0.20
Largest Tenant 37 AN Text
Square Feet of Largest Tenant 38 Numeric 15000
2nd Largest Tenant 39 AN Text
Square Feet of 2nd Largest Tenant 40 Numeric 15000
3rd Largest Tenant 41 AN Text
Square Feet of 3rd Largest Tenant 42 Numeric 15000
Fiscal Year End Month 43 Numeric 12
Securitization Financials As Of Date 44 AN YYYYMMDD
Revenue At Securitization 45 Numeric 1000000
Operating Expenses At Securitization 46 Numeric 1000000
NOI At Securitization 47 Numeric 1000000
DSCR At Securitization 48 Numeric 1.5
Appraisal Value At Securitization 49 Numeric 1000000
Appraisal Date At Securitization 50 AN YYYYMMDD
Physical Occupancy At Securitization 51 Numeric
Date of Last Inspection 52 AN YYYYMMDD
- -------------------------------------------------------------- ----------------------------------------------------
<CAPTION>
- --------------- --------------------------------------------------------------------------------- -------------------
FIELD CSSA
NUMBER DESCRIPTION/COMMENTS LOAN
- --------------- --------------------------------------------------------------------------------- -------------------
<S> <C> <C>
28 P43
29 Map to "Most Recent Fiscal YTD Phys. Occ." in CSSA P71
30 Add a new field to the CSSA Loan file. P71
31 Roll over review to be completed every 12 months
32
33
34
35
36
37 For Office, WH, Retail, Industrial *Only if disclosed in the offering document
38
39 For Office, WH, Retail, Industrial *Only if disclosed in the offering document
40
41 For Office, WH, Retail, Industrial *Only if disclosed in the offering document
42
43 Needed to indicate month ending for borrower's Fiscal Year
44 S72
45 S70
46 S71
47 S65
48 S66
49 S67
50 S68
51 S69
52
- --------------- --------------------------------------------------------------------------------- -------------------
</TABLE>
Page 2 of 9
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- --------------------------------------------- --------------------------------------------- --------------------- ----------
FIELD FORMAT CSSA
FIELD NAME NUMBER TYPE EXAMPLE DESCRIPTION/COMMENTS LOAN
- --------------------------------------------- --------------------------------------------- --------------------- ----------
<S> <C> <C> <C> <C>
Preceding FY Financial As of Date 53 AN YYYYMMDD P58
Preceding Fiscal Year Revenue 54 Numeric 1,000,000 P52
Preceding Fiscal Year Expenses 55 Numeric 1,000,000 P53
Preceding Fiscal Year NOI 56 Numeric 1,000,000 P54
Preceding Fiscal Year Debt Service Amt. 57 Numeric 1,000,000 P55
Preceding Fiscal Year DSCR 58 Numeric 1.30 P56
Preceding Fiscal Year Physical Occupancy 59 Numeric 0.90 P57
Sec Preceding FY Financial As of Date 60 AN YYYYMMDD P65
Second Preceding FY Revenue 61 Numeric 1,000,000 P59
Second Preceding FY Expenses 62 Numeric 1,000,000 P60
Second Preceding FY NOI 63 Numeric 1,000,000 P61
Second Preceding FY Debt Service 64 Numeric 1,000,000 P62
Second Preceding FY DSCR 65 Numeric 1.30 P63
Sec Preceding FY Physical Occupancy 66 Numeric 0.90 P64
- --------------------------------------------- --------------------------------------------- --------------------- ----------
</TABLE>
Page 3 of 9
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ------------------------------------------------------------------------------------------------------------------------------------
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Transaction Id Same as CSSA Loan File
Loan ID Same as CSSA Loan File
Prospectus Loan ID Same as CSSA Loan File
Property ID
Distribution Date Same as CSSA Loan File
Cross-Collateralized Loan Grouping
Property Name If Multi-Prop, no rollup to CSSA Loan File. Populate S55 with"Various."
Property Address If Multi-Prop, no rollup to CSSA Loan File. Populate S56 with"Various."
Property City If Multi-Prop, and all same then populate S57 with City, otherwise,
"Various". Missing info= "incomplete"
Property State If Multi-Prop, and all same then populate S58 with State, otherwise,
"Various". Missing info= "incomplete"
Property Zip Code If Multi-Prop, and all same then populate S59 with Zip, otherwise, "Various".
Missing info= "incomplete"
Property County If Multi-Prop, and all same then populate S60 with County, otherwise, "Various".
Missing info= "incomplete"
Property Type Code If Multi-Prop and all same then populate S61 with property type otherwise
"Various". Missing Info ="incomplete"
Year Built If Multi-Prop, and all same then populate S64 with year otherwise, "000000".
Year Last Renovated If Multi-Prop, and all same then populate P80 with year otherwise, "000000".
Net Square Feet At Securitization Roll-up to loan file if populated. If missing one or more than populate
with "00000"
# Of Units/Beds/Rooms At Securitization Roll-up to loan file if populated. If missing one or more than populate
with "00000"
Property Status If multi-prop and all same than populate CSSA Loan file with property, status,
otherwise various.
Allocated Percentage of Loan at Securitization No field needed in Cssa Loan file
Current Allocated Percentage No field needed in Cssa Loan file
Current Allocated Loan Amount Roll-up to Current Ending SPB (P7)
Ground Lease (Y/S/N) If any property is Y, or S then S74=Y
Other Escrow / Reserve Balances If any property populated, then S77=Y
Most Recent Appraisal Date If Multi-Prop, and all same then populate P74 with date, otherwise, "000000".
Most Recent Appraisal Value Roll-up to CSSA Loan File if populated. If missing any appraisal value, than
populate P75 with "000000)
Date Asset is Expected to Be Resolved If Multi-Prop, latest date from affiliated properties for P79.
Foreclosure Date If Multi-Prop, and all same then populate P42 with date, otherwise, "000000".
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 4 of 9
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ------------------------------------------------------------------------------------------------------------------------------------
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
REO Date If Multi-Prop, and all same then populate P43 with date, otherwise, "000000".
Occupancy % [Weighted Average] For P71=Sum((Curr. Allocated % Prop A) *(Occupancy Prop A)...
(Curr. Allocated % Prop Z) * (Occupancy Prop Z)). If missing one, then, "00000"
Occupancy Date If Multi-Prop, and all same then populate with date, otherwise, "various+K62".
Date Lease Rollover Review No Roll up to the CSSA loan format.
% Sq. Feet expiring 1-12 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 13-24 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 25-36 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 37-48 months No Roll up to the CSSA loan format.
% Sq. Feet expiring 49-60 months No Roll up to the CSSA loan format.
Largest Tenant No Roll up to the CSSA loan format.
Square Feet of Largest Tenant No Roll up to the CSSA loan format.
2nd Largest Tenant No Roll up to the CSSA loan format.
Square Feet of 2nd Largest Tenant No Roll up to the CSSA loan format.
3rd Largest Tenant No Roll up to the CSSA loan format.
Square Feet of 3rd Largest Tenant No Roll up to the CSSA loan format.
Fiscal Year End Month No Roll up to the CSSA loan format.
Securitization Financials As Of Date If Multi-Prop, and all same then populate S72 with date, otherwise, "000000".
Revenue At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S70 with "0000"
Operating Expenses At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S71 with "0000"
NOI At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S85 with "0000"
DSCR At Securitization [Weighted Average] S66=Sum((Allocated % at Sec. Prop A) *(DSCR Prop A)...
((Allocated % at Sec. Prop Z) * (DSCR Prop Z). If missing one, "00000"
Appraisal Value At Securitization Roll up to the CSSA Loan Format, if missing any properties populate S70 with "0000"
Appraisal Date At Securitization If Multi-Prop, and all same then populate S68 with date, otherwise, "000000".
Physical Occupancy At Securitization Weighted Average
Date of Last Inspection
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 5 of 9
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ------------------------------------------------------------------------------------------------------------------------------------
FIELD NAME RELATIONSHIP TO CORRESPONDING CSSA 100.1 FIELD
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C>
Preceding FY Financial As of Date If Multi-Prop, and all same then populate P58 with date, otherwise, "000000+K23K46".K1
Preceding Fiscal Year Revenue No Roll up to the CSSA loan format.
Preceding Fiscal Year Expenses No Roll up to the CSSA loan format.
Preceding Fiscal Year NOI No Roll up to the CSSA loan format.
Preceding Fiscal Year Debt Service Amt. No Roll up to the CSSA loan format.
Preceding Fiscal Year DSCR No Roll up to the CSSA loan format.
Preceding Fiscal Year Physical Occupancy No Roll up to the CSSA loan format.
Sec Preceding FY Financial As of Date No Roll up to the CSSA loan format.
Second Preceding FY Revenue No Roll up to the CSSA loan format.
Second Preceding FY Expenses No Roll up to the CSSA loan format.
Second Preceding FY NOI No Roll up to the CSSA loan format.
Second Preceding FY Debt Service No Roll up to the CSSA loan format.
Second Preceding FY DSCR No Roll up to the CSSA loan format.
Sec Preceding FY Physical Occupancy No Roll up to the CSSA loan format.
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Page 6 of 9
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- --------------------------------------------------
FIELD NAME
- --------------------------------------------------
Transaction Id
Loan ID
Prospectus Loan ID
Property ID
Distribution Date
Cross-Collateralized Loan Grouping
Property Name
Property Address
Property City
Property State
Property Zip Code
Property County
Property Type Code
Year Built
Year Last Renovated
Net Square Feet At Securitization
# Of Units/Beds/Rooms At Securitization
Property Status
Allocated Percentage of Loan at Securitization
Current Allocated Percentage
Current Allocated Loan Amount
Ground Lease (Y/S/N)
Other Escrow / Reserve Balances
Most Recent Appraisal Date
Most Recent Appraisal Value
Date Asset is Expected to Be Resolved
Foreclosure Date
- --------------------------------------------------
Page 7 of 9
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ----------------------------------------
FIELD NAME
- ----------------------------------------
REO Date
Occupancy % "00000"
Occupancy Date
Date Lease Rollover Review
% Sq. Feet expiring 1-12 months
% Sq. Feet expiring 13-24 months
% Sq. Feet expiring 25-36 months
% Sq. Feet expiring 37-48 months
% Sq. Feet expiring 49-60 months
Largest Tenant
Square Feet of Largest Tenant
2nd Largest Tenant
Square Feet of 2nd Largest Tenant
3rd Largest Tenant
Square Feet of 3rd Largest Tenant
Fiscal Year End Month
Securitization Financials As Of Date
Revenue At Securitization
Operating Expenses At Securitization
NOI At Securitization
DSCR At Securitization
Appraisal Value At Securitization
Appraisal Date At Securitization
Physical Occupancy At Securitization
Date of Last Inspection
- ----------------------------------------
Page 8 of 9
<PAGE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "PROPERTY" FILE
(DATA RECORD LAYOUT)
- ----------------------------------------------
FIELD NAME
- ----------------------------------------------
Preceding FY Financial As of Date
Preceding Fiscal Year Revenue
Preceding Fiscal Year Expenses
Preceding Fiscal Year NOI
Preceding Fiscal Year Debt Service Amt.
Preceding Fiscal Year DSCR
Preceding Fiscal Year Physical Occupancy
Sec Preceding FY Financial As of Date
Second Preceding FY Revenue
Second Preceding FY Expenses
Second Preceding FY NOI
Second Preceding FY Debt Service
Second Preceding FY DSCR
Sec Preceding FY Physical Occupancy
- ----------------------------------------------
Page 9 of 9
<PAGE>
EXHIBIT N
Form of
Comparative Financial Status Report
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
COMPARATIVE FINANCIAL STATUS REPORT
as of ____________________
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
S4 S57 S58 P7 P8 S72 S69 S70 S65 S66
- ---------------------------------------------------------------------------------------------------------------
Original Underwriting
- ---------------------------------------------------------------------------------------------------------------
Information
- ---------------------------------------------------------------------------------------------------------------
Basis Year
- ---------------------------------------------------------------------------------------------------------------
Last
Property Scheduled Paid Annual Financial
Prospectus Inspect Loan Thru Debt Info as of % Total $ (1)
ID City State Date Balance Date Service Date Occ Revenue NOI DSCR
- ---------------------------------------------------------------------------------------------------------------
yy/mm yy/mm
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
List all properties currently in deal with or with out information largest to smallest loan
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
Total: $ $ WA $ $ WA
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
===============================================================================================================
Received
- ---------------------------------------------------------------------------------------------------------------
Financial Information: Loans Balance
- ---------------------------------------------------------------------------------------------------------------
# % $ %
- ---------------------------------------------------------------------------------------------------------------
Current Full Year:
- ---------------------------------------------------------------------------------------------------------------
Current Full Yr. received with DSC < 1:
- ---------------------------------------------------------------------------------------------------------------
Prior Full Year:
- ---------------------------------------------------------------------------------------------------------------
Prior Full Yr. received with DSC < 1:
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
(1) DSCR should match to Operating Statement and is normally calculated using NOI/Debt Service.
- ---------------------------------------------------------------------------------------------------------------
(2) Net change chould compare the latest year to the underwriting year
===============================================================================================================
<CAPTION>
- ------------------------------------------------------------------------------------------------
S4 P65 P64 P59 P61 P63 P58 P57 P52 P54 P56
- ------------------------------------------------------------------------------------------------
2nd Preceding Annual Operating Preceding Annual Operating
- ------------------------------------------------------------------------------------------------
Information Information
- ------------------------------------------------------------------------------------------------
as of ___________ Normalized as of ___________ Normalized
- ------------------------------------------------------------------------------------------------
Financial Financial
Prospectus Info as of % Total $ (1) Info as of % Total $ (1)
ID Date Occ Revenue NOI DSCR Date Occ Revenue NOI DSCR
- ------------------------------------------------------------------------------------------------
yy/mm yy/mm
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
Total: WA $ $ WA WA $ $ WA
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
================================================================================================
Required
- ------------------------------------------------------------------------------------------------
Loans Balance
- ------------------------------------------------------------------------------------------------
# % $ %
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
</TABLE>
- -------------------------------------------------------------------------------
S4 P72 P73 P66 P68 P70 (2)
- -------------------------------------------------------------------------------
Trailing Financial or YTD Net Change
- -------------------------------------------------------------------------------
Information
- -------------------------------------------------------------------------------
Month Reported "Actual" Preceding & Basis
- -------------------------------------------------------------------------------
%
Prospectus FS Start FS End Total $ (%) % Total (1)
ID Date Date Revenue NOI DSCR Occ Rev DSC
- -------------------------------------------------------------------------------
yy/mm yy/mm
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Total: WA $ $ WA WA $ WA
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
===============================================================================
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
EXHIBIT O
Form of REO Status Report
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
REO STATUS REPORT
as of ____________________
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 S62 or P8 P7 P37 P39 P38
- -------------------------------------------------------------------------------------------------------------------------
S63 (a) (b) (c) (d)
- -------------------------------------------------------------------------------------------------------------------------
Prospectus Short Name Prope City State Sq Ft Paid Scheduled Total Total Other
ID (When rty or Thru Loan P&I Expenses Advances
Appropriate) Type Units Date Balance Advances To Date (Taxes &
To Date Escrow)
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
S4 P25 P11 P58 P54 P81 P74 P75
- ---------------------------------------------------------------------------------------------------------------------
(e)=a+b+c+d (k) (j) (f)=(k/j) (g)
- ---------------------------------------------------------------------------------------------------------------------
Prospectus Total Current Maturity LTM LTM Cap Valuation Value Appraisal
ID Exposure Monthly Date NOI NOI/ Rate Date using BPO or
P&I Date DSC Assign NOI & Internal
*** Cap Rate Value**
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
S4 P35 P77 P82 P79
- -----------------------------------------------------------------------------------------------------------------
(h)=(.92*g) (i)=(g/e)
- -----------------------------------------------------------------------------------------------------------------
Prospectus Loss Estimated Total Transfer REO Pending
ID using Recovery Appraisal Date Aquisition Resolution Comments
92% % Reduction Date Date
Appr. or Realized
BPO (f)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
(1) Use the following codes; App. - Appraisal, BPO - Brokers Opinion, Int - Internal Value
- -----------------------------------------------------------------------------------------------------------------
*** How to determine the cap rate is agreed upon by Underwriter and servicers - to be provided by a third party.
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT P
Form of Watch List
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
SERVICER WATCH LIST
as of ____________________
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 P7 P8 P11 P54
- ------------------------------------------------------------------------------------------------------------------------------------
Prospectus Short Name Property City State Scheduled Paid Maturity LTM* Comment / Reason on Watch List
ID (When Type Loan Thru Date DSCR
Appropriate) Balance Date
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
List all loans on watch list and reason sorted in decending balance order.
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Total: $
- ------------------------------------------------------------------------------------------------------------------------------------
*LTM - Last 12 months either trailing or last annual
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
P-1
<PAGE>
EXHIBIT Q
Form of Delinquent Loan Status Report
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
DELINQUENT LOAN STATUS REPORT
as of ____________________
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 S62 or S63 P8 P7 P37 P39
- ------------------------------------------------------------------------------------------------------------------------------------
(a) (b) (c)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Short Name Paid Scheduled Total P&I Total
Prospectus (When Property Sq Ft or Thru Loan Advances Expenses
ID Appropriate) Type City State Units Date Balance To Date To Date
- ------------------------------------------------------------------------------------------------------------------------------------
90 + DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
60 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
30 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Current & at Special Servicer
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
FCL - Foreclosure
- ------------------------------------------------------------------------------------------------------------------------------------
LTM - Latest 12 Months either Last Annual or Trailing 12 months
- ------------------------------------------------------------------------------------------------------------------------------------
* Workout Strategy should match the CSSA Loan file using abreviated words in
place of a code number such as (FCL - In Foreclosure, MOD - Modification,
DPO - Discount Payoff, NS - Note Sale, BK - Bankrupcy, PP - Payment Plan,
TBD - To Be Determined etc...)
- ------------------------------------------------------------------------------------------------------------------------------------
It is possible to combine the status codes if the loan is going in more
than one direction. (i.e. FCL/Mod, BK/Mod, BK/FCL/DPO)
- ------------------------------------------------------------------------------------------------------------------------------------
** App - Appraisal, BPO - Broker opinion, Int. - Internal Value
- ------------------------------------------------------------------------------------------------------------------------------------
*** How to determine the cap rate is agreed upon by Underwriter and services - to be provided by a third party
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
S4 P38 P25 P10 P11 P58 P54 P55 P74
- ------------------------------------------------------------------------------------------------------------------------------------
(d) (e)=a+b+c+d (f)=P38/81
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Other Value
Advances Current Current *** using NOI
Prospectus (Taxes & Total Monthly Interest Maturity LTM NOI Cap Rate & Cap Valuation
ID Escrow) Exposure P&I Rate Date Date LTM NOI LTM DSCR Assigned Rate Date
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 P75 P35 P77 P79 P42 P82
- -----------------------------------------------------------------------------------------------------------------------------------
(g)=(.92*f)-e (h)=(g/e)
- -----------------------------------------------------------------------------------------------------------------------------------
Appraisal Total
Short Name BPO or Loss using Estimated Appraisal Expected
Prospectus (When Property City State Internal 90% Appr. Recovery Reduction Transfer Resolution FCL Start FCL Sale
ID Appropriate) Type Value** or BPO (f) % Realized Date Date Date Date
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
90 + DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
60 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
30 DAYS DELINQUENT
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Current & at Special Servicer
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
FCL - Foreclosure
- ------------------------------------------------------------------------------------------------------------------------------------
LTM - Latest 12 Months either Last Annual or Trailing 12 m
- ------------------------------------------------------------------------------------------------------------------------------------
* Workout Strategy should match the CSSA Loan file using abr etc...
- ------------------------------------------------------------------------------------------------------------------------------------
It is possible to combine the status codes if the loan is goi
- ------------------------------------------------------------------------------------------------------------------------------------
** App - Appraisal, BPO - Broker opinion, Int. - Internal Va
- ------------------------------------------------------------------------------------------------------------------------------------
*** How to determine the cap rate is agreed upon by Underwriter and services - to be provided by a third party
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
- -----------------------------------------------------------------------
S4 S55 S61 S57 S58 P76
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Short Name
Prospectus (When Property City State Workout
ID Appropriate) Type Strategy Comments
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
90 + DAYS DELINQUENT
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
60 DAYS DELINQUENT
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
30 DAYS DELINQUENT
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
Current & at Special Servicer
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
FCL - Foreclosure
- -----------------------------------------------------------------------
LTM - Latest 12 Months either Last Annual or Trailing 12 months
- -----------------------------------------------------------------------
* Workout Strategy should match the CSSA Loan file using abr etc...
- -----------------------------------------------------------------------
It is possible to combine the status codes if the loan is goi
- -----------------------------------------------------------------------
** App - Appraisal, BPO - Broker opinion, Int. - Internal Va
- -----------------------------------------------------------------------
*** How to determine the cap rate is agreed upon by Underwriter and
services - to be provided by a third party
- -----------------------------------------------------------------------
<PAGE>
EXHIBIT R
Form of Historical Loan Modification Report
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
HISTORICAL LOAN MODIFICATION REPORT
as of _________________
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
S4 S57 S58 P49 P48 P7* P7* P50* P50* P25*
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Balance Balance at
When the
Mod / Sent to Effective # Mths
Prospectus Extention Effect Speical Date of Old for Rate New Old
ID City State Flag Date Servicer Rehabilitation Rate Change Rate P&I
===========================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
THIS REPORT IS HISTORICAL
- ---------------------------------------------------------------------------------------------------------------------------
Information is as of modification. Each line it should not change in the future. Only new modifications should be added.
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
===========================================================================================================================
Total For All:
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Total For Loans in Current Month:
- ---------------------------------------------------------------------------------------------------------------------------
# of Loans $ Balance
- ---------------------------------------------------------------------------------------------------------------------------
Modifications:
- ---------------------------------------------------------------------------------------------------------------------------
Maturity Date Extentions:
- ---------------------------------------------------------------------------------------------------------------------------
Total:
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
* The information in these columns is from a particular point in time and should not change on this report once assigned.
- ---------------------------------------------------------------------------------------------------------------------------
(1) Actual principal loss taken by bonds
- ---------------------------------------------------------------------------------------------------------------------------
(2) Expected future loss due to a rate reduction. This is just an estimate calculated at the time of the modification.
- ---------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
S4 P25* P11* P11* P47
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
(2) Est.
Future
Total # Interest
Mths (1) Loss to
for Realized Trust $
Prospectus New Old New Change Loss to (Rate
ID P&I Maturity Maturity of Mod Trust $ Reduction) COMMENT
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT S
Form of Historical Loss Estimate Report
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
HISTORICAL LOSS ESTIMATE REPORT (REO-SOLD or DISCOUNTED PAYOFF)
as of ______________________
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
S4 S55 S61 S57 S58 P45/P7 P75 P45 P7 P37 P39+P38
- -----------------------------------------------------------------------------------------------------------------------------------
(c)=b/a (a) (b) (d) (e) (f) (g)
- -----------------------------------------------------------------------------------------------------------------------------------
Latest
Appraisal
Short Name % or Effect Net Amt
Prospectus (When Property Received Brokers Date of Sales Received Scheduled Total P&I Total
ID Appropriate) Type City State From Sale Opinion Sale Price from Sale Balance Advanced Expenses
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------------------------
THIS REPORT IS HISTORICAL
- -----------------------------------------------------------------------------------------------------------------------------------
All information is from the liquidation date and does not need to be updated.
- -----------------------------------------------------------------------------------------------------------------------------------
===================================================================================================================================
Total all Loans:
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Current Month Only:
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
S4
- ---------------------------------------------------------------------------------------------------------
(h) (i)=d-(f+g+h) (k)=i-e (m) (n)=k+m (o)=n/e
- ---------------------------------------------------------------------------------------------------------
Date Minor
Loss Adj Total Loss Loss % of
Prospectus Servicing Actual Losses Passed Minor Adj Passed with Scheduled
ID Fees Expense Net Proceeds Passed thru thru to Trust thru Adjustment Balance
=========================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
THIS REPORT
- ---------------------------------------------------------------------------------------------------------
All information is from the liquidation date and does not need to be updated.
- ---------------------------------------------------------------------------------------------------------
=========================================================================================================
Total all Loans:
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
Current Month Only:
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT T
Form of NOI Adjustment Worksheet
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
Form of NOI ADJUSTMENT WORKSHEET for "year"
as of ____________________
<TABLE>
<S> <C> <C> <C> <C> <C>
PROPERTY OVERVIEW
-------------
Prospectus Number
-------------
Schedule Balance/Paid to Date
--------------------------------------------------------------------------------------------
Property Name
--------------------------------------------------------------------------------------------
Property Type
--------------------------------------------------------------------------------------------
Property Address, City, State
--------------------------------------------------------------------------------------------
Net Rentable Square Feet
-------------
Year Built/Year Renovated
-----------------------------------------
Year of Operations Borrower Adjustment Normalized
-----------------------------------------
Occupancy Rate *
-----------------------------------------
Average Rental Rate
-----------------------------------------
* Occupancy rates are year end or the ending date of the financial statement for the period.
INCOME:
Number of Mos. Annualized "Year"
-------------------------------------------------------------------
Period Ended Borrower Adjustment Normalized
Statement Classification Actual
-------------------------------------------------------------------
Rental Income (Category 1)
-------------------------------------------------------------------
Rental Income (Category 2)
-------------------------------------------------------------------
Rental Income (Category 3)
-------------------------------------------------------------------
Pass Throughs/Escalations
-------------------------------------------------------------------
Other Income
-------------------------------------------------------------------
-------------------------------------------------------------------
Effective Gross Income $0.00 $0.00 $0.00
-------------------------------------------------------------------
Normalized - Full year Financial statements that have been reviewed by the underwriter or
Servicer.
OPERATING EXPENSES:
-------------------------------------------------------------------
Real Estate Taxes
-------------------------------------------------------------------
Property Insurance
-------------------------------------------------------------------
Utilities
-------------------------------------------------------------------
General & Administration
-------------------------------------------------------------------
Repairs and Maintenance
-------------------------------------------------------------------
Management Fees
-------------------------------------------------------------------
Payroll & Benefits Expense
-------------------------------------------------------------------
Advertising & Marketing
-------------------------------------------------------------------
Professional Fees
-------------------------------------------------------------------
Other Expenses
-------------------------------------------------------------------
Ground Rent
-------------------------------------------------------------------
Total Operating Expenses $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
Operating Expense Ratio
-------------------------------------------------------------------
-------------------------------------------------------------------
Net Operating Income $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
Leasing Commissions
-------------------------------------------------------------------
Tenant Improvements
-------------------------------------------------------------------
Replacement Reserve
-------------------------------------------------------------------
Total Capital Items $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
N.O.I. After Capital Items $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
Debt Service (per Servicer) $0.00 $0.00 $0.00
-------------------------------------------------------------------
Cash Flow after debt service $0.00 $0.00 $0.00
-------------------------------------------------------------------
-------------------------------------------------------------------
(1)DSCR: (NOI/Debt Service)
-------------------------------------------------------------------
-------------------------------------------------------------------
DSCR: (after reserves\Cap exp.)
-------------------------------------------------------------------
-------------------------------------------------------------------
Source of Financial Data:
-------------------------------------------------------------------
(ie. operating statements, financial statements, tax return, other)
</TABLE>
Notes and Assumptions:
================================================================================
This report should be completed by the Servicer for any "Normalization" of the
Borrower's numbers.
The "Normalized" column is used in the Operating Statement Analysis Report.
This report may vary depending on the property type and because of the way
information may vary in each borrowers statement.
Income: Comments
Expense: Comments
Capital Items: Comments
(1) Used in the Comparative Financial Status Report
<PAGE>
EXHIBIT U
Form of Operating Statement Analysis
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust 1998-C2
OPERATING STATEMENT ANALYSIS REPORT
as of ____________________
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C>
PROPERTY OVERVIEW
--------------
Prospectus Number
--------------
-------------
Scheduled Balance/Paid to Date
---------------------------------------------------------------------------------------------------
Property Name
---------------------------------------------------------------------------------------------------
Property Type
---------------------------------------------------------------------------------------------------
Property Address, City, State
---------------------------------------------------------------------------------------------------
Net Rentable Square Feet
--------------------------
Year Built/Year Renovated
-----------------------------------------------------------------
Year of Operations Underwriting 1994 1995 1996 Trailing
-----------------------------------------------------------------
Occupancy Rate *
-----------------------------------------------------------------
Average Rental Rate
-----------------------------------------------------------------
* Occupancy rates are year end or the ending date of the financial statement for the period.
INCOME: No. of Mos.
--------------
Number of Mos. Prior Year Current Yr.
------------------------------------------------------------------------------------------
Period Ended Underwriting 1994 1995 1996 97 Trailing** 1996-Base 1996-1995
--------------
Statement Classification Base Line Normalized Normalized Normalized as of / /97 Variance Variance
------------------------------------------------------------------------------------------
Rental Income (Category 1)
------------------------------------------------------------------------------------------
Rental Income (Category 2)
------------------------------------------------------------------------------------------
Rental Income (Category 3)
------------------------------------------------------------------------------------------
Pass Through/Escalations
------------------------------------------------------------------------------------------
Other Income
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Gross Income $0.00 $0.00 $0.00 $0.00 $0.00 % %
------------------------------------------------------------------------------------------
Normalized - Full year Financial statements that have been reviewed by the underwriter or
Servicer
** Servicer will not be expected to "Normalize" these YTD numbers.
OPERATING EXPENSES:
------------------------------------------------------------------------------------------
Real Estate Taxes
------------------------------------------------------------------------------------------
Property Insurance
------------------------------------------------------------------------------------------
Utilities
------------------------------------------------------------------------------------------
General & Administration
------------------------------------------------------------------------------------------
Repairs and Maintenance
------------------------------------------------------------------------------------------
Management Fees
------------------------------------------------------------------------------------------
Payroll & Benefits Expense
------------------------------------------------------------------------------------------
Advertising & Marketing
------------------------------------------------------------------------------------------
Professional Fees
------------------------------------------------------------------------------------------
Other Expenses
------------------------------------------------------------------------------------------
Ground Rent
------------------------------------------------------------------------------------------
Total Operating Expenses $0.00 $0.00 $0.00 $0.00 $0.00 % %
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Operating Expense Ratio
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Net Operating Income $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Leasing Commissions
------------------------------------------------------------------------------------------
Tenant Improvements
------------------------------------------------------------------------------------------
Replacement Reserve
------------------------------------------------------------------------------------------
Total Capital Items $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
N.O.I. After Capital Items $0.00 $0.00 $0.00 $0.00 $0.00 % %
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Debt Service (per Servicer) $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
Cash Flow after debt service $0.00 $0.00 $0.00 $0.00 $0.00
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
(1) DSCR: (NOI/Debt Service)
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
DSCR: (after reserves\Cap exp.)
------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------
Source of Financial Data:
------------------------------------------------------------------------------------------
(ie. operating statements, financial statements, tax return, other)
Notes and Assumptions:
===========================================================================================================================
</TABLE>
The years shown above will roll always showing a three year history. 1996 is the
current year financials; 1995 is the prior year financials.
This report may vary depending on the property type and because of the way
information may vary in each borrowers statement.
Rental Income needs to be broken down, differently whenever possible differently
for each property type as follows: Retail: 1) Base Rent 2) Percentage rents on
cashflow Hotel: 1) Room Revenue 2) Food/Beverage Nursing Home: 1) Private 2)
Medicaid 3) Medicare
Income: Comment
Expense: Comment
Capital Items: Comment
(1) Used in the Comparative Financial Status Report
<PAGE>
EXHIBIT V
Form of Loan Payoff Notification Report
<TABLE>
<CAPTION>
LOAN PAYMENT NOTIFICATION REPORT
as of_____________
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------|----------------------------------------
S4 S55 S61 S58 P7 P8 P10 P11 P54 | SERVICER ESTIMATED INFORMATION
- -------------------------------------------------------------------------------------------|----------------------------------------
PROSPECTUS SHORT NAME PROPERTY SCHEDULED PAID CURRENT MATURITY LTM | YIELD EXPECTED EXPECTED
ID (WHEN TYPE STATE LOAN THRU INTEREST DATE DSCR | MAINTENANCE PAYMENT DISTRIBUTION
APPROPRIATE) BALANCE DATE RATE | DATE DATE
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
Scheduled Payments |
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
Unscheduled Payments |
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
Total: $ |
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
- -------------------------------------------------------------------------------------------|----------------------------------------
THE BORROWER HAS ONLY REQUESTED THE INFORMATION TO PAY-OFF. THIS DOES NOT INDICATE A DEFINITE PAYMENT.
</TABLE>
V-1
<PAGE>
EXHIBIT W
Form of CSSA Loan File Report
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "LOAN PERIODIC" UPDATE FILE
(Data Record Layout)
<CAPTION>
====================================================================================================================================
Specification | Description/Comments
- ---------------------------------------|--------------------------------------------------------------------------------------------
<S> <C>
Acceptable Media Types | Magnetic Tape, Diskette, Electronic Transfer
Character Set | ASCII
Field Delineation | Comma
Density (Bytes-Per-Inch) | 1600 or 6250
Magnetic Tape Label | None (unlabeled)
Magnetic Tape Blocking Factor | 10285 (17 records per block)
Physical Media Label | Servicer Name; Data Type (Collection Period Data); Density (Bytes-Per-Inch);
| Blocking Factor; Record Length
Return Address Label | Required for return of physical media (magnetic tape or diskette)
====================================================================================================================================
<CAPTION>
====================================================================================================================================
| Field Format |
Field Name | Number Type Example | Description/Comments
- ---------------------------------------|--------------------------------------|-----------------------------------------------------
<S> <C> <C> <C> <C>
Transaction Id | 1 AN XXX97001 | Unique Issue Identification Mnemonic
Group Id | 2 AN XXX9701A | Unique Identification Number Assigned To Each
| | Loan Group Within An Issue
Loan Id | 3 AN 00000000012345 | Unique Identification Number Assigned To Each
| | Collateral Item In A Pool
Prospectus Id | 4 AN 123 | Unique Identification Number Assigned To Each
| | Collateral Item In The Prospectus
Distribution Date | 5 AN YYYYMMDD | Date Payments Made To Certificateholders
Current Beginning Sched Balance | 6 Numeric 100000.00 | Outstanding Scheduled Principal Balance At The
| | Beginning Of The Current Period
Current Ending Scheduled Balance | 7 Numeric 100000.00 | Outstanding Scheduled Principal Balance At The
| | End Of The Current Period
Paid To Date | 8 AN YYYYMMDD | Due Date Of The Last Interest Payment Received
Current Index Rate | 9 Numeric 0.09 | Index Rate Used In The Determination Of The
| | Current Period Gross Interest Rate
Current Note Rate | 10 Numeric 0.09 | Annualized Gross Rate Applicable To Calculate
| | The Current Period Scheduled Interest
Maturity Date | 11 AN YYYYMMDD | Date Collateral Is Scheduled To Make Its
| | Final Payment
Servicer and Trustee Fee Rate | 12 Numeric 0.00025 | Annualized Fee Paid To The Servicer And Trustee
Fee Rate/Strip Rate 1 | 13 Numeric 0.00001 | Annualized Fee/Strip Netted Against Current
| | Note Rate = Net Pass-Through Rate
Fee Rate/Strip Rate 2 | 14 Numeric 0.00001 | Annualized Fee/Strip Netted Against Current
| | Note Rate = Net Pass-Through Rate
Fee Rate/Strip Rate 3 | 15 Numeric 0.00001 | Annualized Fee/Strip Netted Against Current
| | Note Rate = Net Pass-Through Rate
Fee Rate/Strip Rate 4 | 16 Numeric 0.00001 | Annualized Fee/Strip Netted Against Current
| | Note Rate = Net Pass-Through Rate
Fee Rate/Strip Rate 5 | 17 Numeric 0.00001 | Annualized Fee/Strip Netted Against Current
| | Note Rate = Net Pass-Through Rate
Net Pass-Through Rate | 18 Numeric 0.0897 | Annualized Interest Rate Applicable To
| | Calculate The Current Period Remittance Int.
Next Index Rate | 19 Numeric 0.09 | Index Rate Used In The Determination Of The
| | Next Period Gross Interest Rate
Next Note Rate | 20 Numeric 0.09 | Annualized Gross Interest Rate Applicable
| | To Calc Of The Next Period Sch. Interest
Next Rate Adjustment Date | 21 AN YYYYMMDD | Date Note Rate Is Next Scheduled To Change
Next Payment Adjustment Date | 22 AN YYYYMMDD | Date Scheduled P&I Amount Is Next Scheduled
| | To Change
====================================================================================================================================
</TABLE>
Page 1 of 4
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "LOAN PERIODIC" UPDATE FILE
(Data Record Layout)
<CAPTION>
====================================================================================================================================
| Field Format |
Field Name | Number Type Example | Description/Comments
- ---------------------------------------|--------------------------------------|-----------------------------------------------------
<S> <C> <C> <C> <C>
Scheduled Interest Amount | 23 Numeric 1000.00 | Scheduled Gross Interest Payment Due For The
| | Current Period
Scheduled Principal Amount | 24 Numeric 1000.00 | Scheduled Principal Payment Due For The
| | Current Period
Total Scheduled P&I Due | 25 Numeric 1000.00 | Scheduled Principal And Interest Payment Due
| | For The Current Period
Neg am/Deferred Interest Amount | 26 Numeric 1000.00 | Negative Amortization/Deferred Interest Amount
| | Due For The Current Period
Unscheduled Principal Collections | 27 Numeric 1000.00 | Unscheduled Payments Of Principal Received
| | During The Related Collection Period
Other Principal Adjustments | 28 Numeric 1000.00 | Unscheduled Principal Adjustments For
| | The Related Collection Period
Liquidation/Prepayment Date | 29 AN YYYYMMDD | Date Unscheduled Payment Of Principal Received
Prepayment Penalty/Yld Maint Rec'd | 30 Numeric 1000.00 | Additional Payment Req'd From Borrower Due
| | To Prepayment Of Loan Prior To Maturity
Prepayment Interest Excess (Shortfall) | 31 Numeric 1000.00 | Scheduled Gross Interest Applicable To The
| | Prepayment Amount
Liquidation/Prepayment Code | 32 Numeric 1 | See Liquidation/Prepayment Codes Legend
Most Recent ASER $ | 33 Numeric 1000.00 | Excess Of The Principal Balance Over The
| | Defined Appraisal Percentage
Most Recent ASER Date | 34 AN YYYYMMDD | Date ASER Amount Applied To Loan
Cumulative ASER $ | 35 Numeric 1000.00 | Cumulative ASER Amount
Actual Balance | 36 Numeric 100000.00 | Outstanding Actual Principal Balance At The
| | End Of The Current Period
Total P&I Advance Outstanding | 37 Numeric 1000.00 | Outstanding P&I Advances At The End Of The
| | Current Period
Total T&I Advance Outstanding | 38 Numeric 1000.00 | Outstanding Taxes & Insurance Advances At
| | The End Of The Current Period
Other Expense Advance Outstanding | 39 Numeric 1000.00 | Other Outstanding Advances At The End Of
| | The Current Period
Status of Loan | 40 AN 1 | See Status Of Loan Legend
In Bankruptcy | 41 AN Y | Bankruptcy Status Of Loan (If In Bankruptcy
| | "Y", Else "N")
Foreclosure Date | 42 AN YYYYMMDD | Date Of Foreclosure
REO Date | 43 AN YYYYMMDD | Date Of REO
Bankruptcy Date | 44 AN YYYYMMDD | Date Of Bankruptcy
Net Proceeds Received on Liquidation | 45 Numeric 100000.00 | Net Proceeds Rec'd On Liquidation To Be
| | Remitted To The Tr Per The Tr Doc'n
Liquidation Expense | 46 Numeric 100000.00 | Expenses Associated With The Liq'n To Be
| | Netted From The Tr Per The Tr Doc'n
Realized Loss to Trust | 47 Numeric 10000.00 | Liquidation Balance Less Net Liquidation
| | Proceeds Received
Date of Last Modification | 48 AN YYYYMMDD | Date Loan Was Modified
Modification Code | 49 Numeric 1 | See Modification Codes Legend
Modified Note Rate | 50 Numeric 0.09 | Note Rate Loan Modified To
Modified Payment Rate | 51 Numeric 0.09 | Payment Rate Loan Modified To
Preceding Fiscal Year Revenue | 52 Numeric 1000.00 | Preceding Fiscal Year Revenue
Preceding Fiscal Year Expenses | 53 Numeric 1000.00 | Preceding Fiscal Year Expenses
Preceding Fiscal Year NOI | 54 Numeric 1000.00 | Preceding Fiscal Year Net Op Income
Preceding Fiscal Year Debt Svc Amt. | 55 Numeric 1000.00 | Preceding Fiscal Year Debt Svc Amount
Preceding Fiscal Year DSCR | 56 Numeric 2.55 | Preceding Fiscal Yr Debt Svc Cvrge Ratio
====================================================================================================================================
-----------------------------------
| All Financial Update Fields Are |
| Calculated and/or Presented In |
| The Manner Described In The |
| Associated Trust Documentation. |
-----------------------------------
</TABLE>
Page 2 of 4
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "LOAN PERIODIC" UPDATE FILE
(Data Record Layout)
<CAPTION>
====================================================================================================================================
| Field Format |
Field Name | Number Type Example | Description/Comments
- ---------------------------------------|--------------------------------------|-----------------------------------------------------
<S> <C> <C> <C> <C>
Preceding Fiscal Yr Physical Occ'y | 57 Numeric 0.85 | Preceding Fiscal Year Physical Occupancy
Preceding FY Financial As of Date | 58 AN YYYYMMDD | Preceding Fiscal Year Financial As Of Date
Second Preceding FY Revenue | 59 Numeric 1000.00 | Second Preceding Fiscal Year Revenue
Second Preceding FY Expenses | 60 Numeric 1000.00 | Second Preceding Fiscal Year Expenses
Second Preceding FY NOI | 61 Numeric 1000.00 | Second Preceding Fiscal Year Net Operating
| | Income
Second Preceding FY Debt Service | 62 Numeric 1000.00 | Second Preceding Fiscal Year Debt Service
Second Preceding FY DSCR | 63 Numeric 2.55 | Second Preceding Fiscal Year Debt Svc
| | Cvrge Ratio
Sec Preceding FY Physical Occ'y | 64 Numeric 0.85 | Second Preceding Fiscal Year Physical
| | Occupancy
Sec Preceding FY Fin'l As of Date | 65 AN YYYYMMDD | Second Preceding Fiscal Year Financial
| | As Of Date
Most Recent Fiscal YTD Revenue | 66 Numeric 1000.00 | Most Recent Fiscal Year To Date Revenue
Most Recent Fiscal YTD Expenses | 67 Numeric 1000.00 | Most Recent Fiscal Year To Date Expenses
Most Recent Fiscal YTD NOI | 68 Numeric 1000.00 | Most Recent Fiscal Year To Date Net
| | Operating Income
Most Recent Fiscal YTD Debt Service | 69 Numeric 1000.00 | Most Recent Fiscal Year To Date Debt Service
Most Recent Fiscal YTD DSCR | 70 Numeric 2.55 | Most Recent Fiscal Year To Date Debt Service
| | Coverage Ratio
Most Recent Fiscal YTD Phys. Occ. | 71 Numeric 0.85 | Most Recent Fiscal Year To Date Physical
| | Occupancy
Most Recent Fiscal YTD Start Date | 72 AN YYYYMMDD | Most Recent Fiscal Year To Date Start Date
Most Recent Fiscal YTD End Date | 73 AN YYYYMMDD | Most Recent Fiscal Year To Date End Date
Most Recent Appraisal Date | 74 AN YYYYMMDD | The Date Of The Latest Available Appraisal
| | For The Property
Most Recent Appraisal Value | 75 Numeric 100000.00 | The Latest Available Appraisal Value For
| | The Property
Workout Strategy Code | 76 Numeric 1 | See Workout Strategy Codes Legend
Most Recent Spec Svc Transfer Date | 77 AN YYYYMMDD | Date Transferred To The Special Servicer
Most Recent Master Svc Return Date | 78 AN YYYYMMDD | Date Returned To The Master Servicer
Date Asset Expected to Be Resolved | 79 AN YYYYMMDD | Date Asset Is Expected To Be Resolved
Year Last Renovated | 80 AN 1997 | Year Property Last Renovated
- ------------------------------------------------------------------------------------------------------------------------------------
----------------------------------
| Most Recent Fiscal YTD Figures |
| Are From The Last Financials |
| Processed By The Servicer |
| Pursuant To The Terms Of The |
| Trust Document, And Cover The |
| Period From The Start Date To |
| The End Date. |
----------------------------------
NEW FIELDS ADDED:
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cap Rate Assigned | 81 Numeric 10 | Cap Rate Assigned
FCL Sale Date (Expected or Actual) | 82 AN YYYYMMDD | FCL Sale Date Expected or Actual
====================================================================================================================================
</TABLE>
Page 3 of 4
<PAGE>
<TABLE>
COMMERCIAL REAL ESTATE SECONDARY MARKET SECURITIZATION ASSOCIATION
CSSA "LOAN PERIODIC" UPDATE FILE
(Data Record Layout)
<CAPTION>
====================================================================================================================================
Liquidation/Prepayment Code | Status of Mortgage Loan | Modification Code
Legend | Legend | Legend
- ----------------------------------|--------------------------------------------------------------|----------------------------------
<S> <C> <C>
1 Partial Liq'n (Curtailment) | A Payment Not Received But Still In Grace Period | 1 Maturity Date Extension
2 Payoff Prior To Maturity | B Late Payment But Less Than 1 Month Delinquent | 2 Amortization Change
3 Disposition | 0 Current | 3 Principal Write-Off
4 Repurchase | 1 One Month Delinquent | 4 Combination
5 Full Payoff At Maturity | 2 Two Months Delinquent |
6 DPO | 3 Three Or More Months Delinquent |
7 Liquidation | 4 Assumed Sched Payment (Performing Matured Ball'n) |
| 7 Foreclosure |
| 9 REO |
====================================================================================================================================
<CAPTION>
================================================================
| Workout Strategy Code |
| Legend |
|---------------------------------------------------------------
<S> <C>
| 1 Modification |
| 2 Foreclosure |
| 3 Bankruptcy |
| 4 Extension |
| 5 Note Sale |
| 6 DPO |
| 7 REO |
| 8 Resolved |
| 9 Pending Return to Master Servicer |
| 10 Deed In Lieu Of Foreclosure |
================================================================
</TABLE>
Page 4 of 4
<PAGE>
EXHIBIT X-1
FORM OF CERTIFICATEHOLDER CONFIRMATION CERTIFICATE
REQUEST BY BENEFICIAL HOLDER
[Date]
Norwest Bank Minnesota, National Association
Three New York Plaza
New York, New York 10004
Attention: Corporate Trust Services (CMBS)
Re: First Union-Lehman Brothers-Bank of America, Commercial Mortgage Trust,
Commercial Mortgage Pass-Through Certificates, Series 1998-C2
In accordance with Section 3.15 of the Pooling and Servicing Agreement.
dated as of May 1, 1998 (the "Pooling and Servicing Agreement"), among First
Union Commercial Mortgage Securities, Inc. as depositor (the "Depositor"), First
Union National Bank, as master servicer, CRIIMI MAE Services Limited
Partnership, as special servicer, and Norwest Bank Minnesota, National
Association as trustee (in such capacity, the "Trustee"), with respect to the
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust,
Commercial Mortgage Pass-Through Certificates, Series 1998-C2 (the
"Certificates"), the undersigned hereby certifies and agrees as follows:
1. The undersigned is a beneficial owner of the Class ____
Certificates.
2. The undersigned is requesting the information identified on
the schedule attached hereto pursuant to Section 3.15 of the
Pooling and Servicing Agreement (the "Information").
3. In consideration of the Trustee's disclosure to the
undersigned of the Information, the undersigned will keep
the Information confidential (except from such outside
persons as are assisting it in making the evaluation
described in paragraph 2), and such Information will not,
without the prior written consent of the Trustee, be
disclosed by the undersigned or by its officers, directors,
partners employees, agents or representatives (collectively,
the "Representatives") in any manner whatsoever, in whole or
in part; provided that the undersigned may provide all or
any part of the Information to any other person or entity
that holds or is contemplating the purchase of any
Certificate or interest therein, but only if such person or
entity
X-1-1
<PAGE>
confirms in writing such ownership interest or prospective
ownership interest and agrees to keep it confidential.
4. The undersigned will not use or disclose the Information in
any manner which could result in a violation of any
provision of the Securities Act of 1933, as amended, (the
"Securities Act"), or the Securities Exchange Act of 1934,
as amended, or would require registration of any Certificate
pursuant to Section 5 of the Securities Act.
5. The undersigned shall be fully liable for any breach of this
agreement by itself or any of its Representatives and shall
indemnify the Depositor, the Trustee and the Trust for any
loss, liability or expense incurred thereby with respect to
any such breach by the undersigned or any of its
Representatives.
IN WITNESS WHEREOF, the undersigned has caused its name to be signed hereto
by its duly authorized officer, as of the day and year written above.
[BENEFICIAL HOLDER OF A CERTIFICATE]
By:
-----------------------------------
Name:
Title:
X-1-2
<PAGE>
EXHIBIT X-2
FORM PROSPECTIVE PURCHASER CERTIFICATE
[Date]
[TRUSTEE]
Re: First Union-Lehman Brothers-Bank of America, Commercial Mortgage
Trust, Commercial Mortgage Pass-Through Certificates, Series 1998-C2
(the "Certificates").
In accordance with Section 3.15 of the Pooling and Servicing Agreement,
dated as of May 1, 1998 (the "Pooling and Servicing Agreement"), among First
Union Commercial Mortgage Securities, Inc., as depositor (the "Depositor"),
First Union National Bank as master servicer, CRIIMI MAE Services Limited
Partnership, as special servicer, and Norwest Bank Minnesota, National
Association as trustee (in such capacity, the "Trustee"), with respect to the
First Union-Lehman Brothers-Bank of America, Commercial Mortgage Trust,
Commercial Mortgage Pass-Through Certificates, Series 1998-C2 (the
"Certificates"), the undersigned hereby certifies and agrees as follows:
1. The undersigned is contemplating an investment in the Class
__ Certificates.
2. The undersigned is requesting the information identified on
the schedule attached hereto pursuant to Section 3.15 of the
Pooling and Servicing Agreement (the "Information") for use
in evaluating such possible investment.
3. In consideration of the Trustee's disclosure to the
undersigned of the Information, the undersigned will keep
the Information confidential (except from such outside
persons as are assisting it in making the investment
decision described in paragraphs 1 and 2), and such
Information will not, without the prior written consent of
the Trustee, be disclosed by the undersigned or by its
officers, directors, partners employees, agents or
representatives (collectively, the "Representatives") in any
manner whatsoever, in whole or in part.
4. The undersigned will not use or disclose the Information in
any manner which could result in a violation of any
provision of the Securities Act of 1933, as amended (the
"Securities Act"), or the Securities Exchange Act of 1934,
as amended, or
X-2-1
<PAGE>
would require registration of any Certificate pursuant to
Section 5 of the Securities Act.
5. The undersigned shall be fully liable for any breach of this
agreement by itself or any of its Representatives and shall
indemnify the Depositor, the Trustee and the Trust for any
loss, liability or expense incurred thereby with respect to
any such breach by the undersigned or any of its
Representatives.
IN WITNESS WHEREOF, the undersigned has caused its name to be signed hereto
by its duly authorized officer, as of the day and year written above.
[PROSPECTIVE PURCHASER]
By:
-----------------------------------
Name:
Title:
X-2-2
<PAGE>
Exhibit 99.1
EXECUTION
MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement, dated as of May 1, 1998 (the
"Agreement"), between Lehman Brothers Holdings Inc., doing business as Lehman
Capital, a division of Lehman Brothers Holdings Inc. (the "Seller") and First
Union Commercial Mortgage Securities, Inc. (the "Purchaser").
The Seller intends to sell and the Purchaser intends to purchase
certain multifamily and commercial mortgage loans (the "Lehman Mortgage Loans")
as provided herein. The Purchaser intends to deposit them, together with the
Other Mortgage Loans (as defined below), into a trust fund (the "Trust Fund"),
the beneficial ownership of which will be evidenced by multiple classes (each, a
"Class") of mortgage pass-through certificates (the "Certificates"). One or more
"real estate mortgage investment conduit" ("REMIC") elections will be made with
respect to the Trust Fund. The Trust Fund will be created and the Certificates
will be issued pursuant to a Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of the Cut-off Date, among the Purchaser as
depositor, First Union National Bank as master servicer (in such capacity, the
"Master Servicer"), CRIIMI MAE Services Limited Partnership as special servicer
(in such capacity, the "Special Servicer"), and Norwest Bank Minnesota, National
Association as trustee (the "Trustee"). Concurrently with the purchase of the
Lehman Mortgage Loans pursuant to this Agreement, the Purchaser will also
purchase certain multifamily and commercial mortgage loans (the "Other Mortgage
Loans"; and, collectively with the Lehman Mortgage Loans, the "Mortgage Loans")
pursuant to two Mortgage Loan Purchase Agreements, each dated as of May 1, 1998,
between, in one case, First Union National Bank and the Purchaser, and between,
in the other case, Bank of America NT&SA and the Purchaser. The Other Mortgage
Loans will likewise be deposited into the Trust Fund. Capitalized terms used but
not defined herein have the respective meanings set forth in the Pooling and
Servicing Agreement.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
(a) The Seller agrees to sell, and the Purchaser agrees to purchase,
the Lehman Mortgage Loans identified on the schedule (the "Mortgage Loan
Schedule") annexed hereto as Exhibit A. The Mortgage Loan Schedule may be
amended to reflect the actual Mortgage Loans delivered to the Purchaser pursuant
to the
<PAGE>
terms hereof. The Lehman Mortgage Loans will have an aggregate principal balance
of $1,729,671,085.00 (the "Lehman Balance") (subject to a variance of plus or
minus 5.0%) as of the close of business on the Cut-off Date, after giving effect
to any payments due on or before such date whether or not received. The Lehman
Balance, together with the aggregate principal balance of the Other Mortgage
Loans as of the Cut-Off Date (after giving effect to any payments due on or
before such date whether or not received), shall equal an aggregate principal
balance (the "Initial Pool Balance") of $3,408,048,239 (subject to a variance of
plus or minus 5%). The purchase and sale of the Lehman Mortgage Loans shall take
place on May 28, 1998 or such other date as shall be mutually acceptable to the
parties hereto (the "Closing Date"). The consideration for the Lehman Mortgage
Loans shall consist of a cash amount equal to $1,774,790,381 (the "Aggregate
Purchase Price") (which is equal to the Lehman Balance plus interest accrued on
the Lehman Balance at the related Net Mortgage Rate for the period from and
including the Cut-off Date up to but not including the Closing Date less fees
and expenses payable by the Seller) which cash amount shall be paid to the
Seller or its designee by wire transfer in immediately available funds on the
Closing Date.
The Purchaser will assign to the Trustee, all of its right, title
and interest in and to the Lehman Mortgage Loans.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 hereof, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Purchaser, without
recourse, all the right, title and interest of the Seller in and to the Lehman
Mortgage Loans identified on the Mortgage Loan Schedule as of such date other
than the primary servicing rights. The Mortgage Loan Schedule, as it may be
amended, shall conform to the requirements set forth in this Agreement and the
Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive all
scheduled payments of principal and interest due after the Cut-off Date, and all
other recoveries of principal and interest collected after the Cut-off Date
(other than in respect of principal and interest on the Lehman Mortgage Loans
due on or before the Cut-off Date). All scheduled payments of principal and
interest due on or before the Cut-off Date but collected after the Cut-off Date,
and recoveries of principal and interest collected on or before the Cut-off Date
(only in respect of principal and interest on the Lehman Mortgage Loans due on
or before the Cut-off Date and principal prepayments thereon), shall belong to,
and be promptly remitted to, the Seller.
(c) The Seller hereby represents and warrants that it has, on behalf
of the Purchaser, delivered to the Trustee, the
<PAGE>
documents and instruments specified below with respect to each Lehman Mortgage
Loan (each a "Mortgage File"). All Mortgage Files so delivered will be held by
the Trustee in escrow at all times prior to the Closing Date. Each Mortgage File
shall, except as otherwise disclosed on Exhibit B hereto, contain the following
documents:
(i) the original executed Mortgage Note (or a lost note affidavit
and indemnity with a copy of such Mortgage Note attached
thereto) together with any intervening endorsements thereon,
endorsed (without recourse, representation or warranty,
express or implied) to the order of NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as trustee for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 1998-C2 or in blank;
(ii) an original or copy of the Mortgage and any intervening
assignments thereof, in each case with evidence of recording
indicated thereon;
(iii) an original or copy of any related Assignment of Leases (if
such item is a document separate from the Mortgage), together
with any intervening assignments thereof, in each case with
evidence of recording indicated thereon;
(iv) an original executed assignment, in recordable form, of (a)
the Mortgage, (b) any related Assignment of Leases (if such
item is a document separate from the Mortgage) and (c) any
other recorded document relating to the Mortgage Loan
otherwise included in the Mortgage File, in favor of NORWEST
BANK MINNESOTA, NATIONAL ASSOCIATION, as trustee for the
registered holders of First Union-Lehman Brothers-Bank of
America Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2 in recordable form;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as trustee for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 1998-C2;
(vi) originals or copies of any written modification agreements in
those instances where the terms or provisions of the Mortgage
or Mortgage Note have been modified;
<PAGE>
(vii) the original or a copy of the policy or certificate of
lender's title insurance issued on the date of the origination
of such Mortgage Loan, or, if such policy has not been issued,
an irrevocable, binding commitment to issue such title
insurance policy; and
(viii) any filed copies (with evidence of filing) of any prior UCC
Financing Statements in favor of the originator of such
Mortgage Loan or in favor of any assignee prior to the Trustee
(but only to the extent the Seller had possession of such UCC
Financing Statements prior to the Closing Date) and, if there
is an effective UCC Financing Statement in favor of the Seller
on record with the applicable public office for UCC Financing
Statements, an original UCC-2 or UCC-3 assignment, in form
suitable for filing, as appropriate, in favor of NORWEST BANK
MINNESOTA, NATIONAL ASSOCIATION, as trustee for the registered
holders of First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 1998-C2; and
(ix) an original or copy of any Ground Lease, any Credit Lease and
any Lease Enhancement Policy or Guaranty.
(d) Within 30 days following the Closing Date, the Purchaser shall
submit or cause to be submitted for recordation or filing, as the case may be,
in the appropriate public office for real property records or Uniform Commercial
Code financing statements, as appropriate, each assignment of Mortgage and each
assignment of Assignment of Leases referred to in clause (iv) of subsection (c)
above and each UCC-2 and UCC-3 in favor of and delivered to the Trustee
constituting part of the Mortgage File. If any such document or instrument is
lost or returned unrecorded or unfiled, as the case may be, because of a defect
therein, then the Seller shall prepare a substitute therefor or cure such defect
or cause such to be done, as the case may be, and the Seller shall deliver such
substitute or corrected document or instrument to the Purchaser or its designee.
(e) All documents and records (except attorney-client privileged
communication and internal credit analysis of the Seller) relating to each
Lehman Mortgage Loan and in the Seller's possession (the "Additional Mortgage
Loan Documents") that are not required to be delivered to the Trustee shall be
delivered or caused to be delivered by the Seller to the Master Servicer or at
the direction of the Master Servicer to the appropriate sub-servicer, together
with any related escrow amounts and reserve amounts.
<PAGE>
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants with
the Purchaser, as of the date hereof, that:
(i) The Seller is a corporation validly existing under the
laws of the State of Delaware and possesses all requisite authority,
power, licenses, permits and franchises to carry on its business as
currently conducted by it and to execute, deliver and comply with its
obligations under the terms of this Agreement.
(ii) This Agreement has been duly and validly authorized,
executed and delivered by the Seller and, assuming due authorization,
execution and delivery hereof by the Purchaser, constitutes a legal, valid
and binding obligation of the Seller, enforceable against the Seller in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights in general, and by general
equity principles (regardless of whether such enforcement is considered in
a proceeding in equity or at law), and by public policy considerations
underlying the securities laws, to the extent that such public policy
considerations limit the enforceability of the provisions of this
Agreement which purport to provide indemnification from liabilities under
applicable securities laws.
(iii) The execution and delivery of this Agreement by the
Seller and the Seller's performance and compliance with the terms of this
Agreement will not (A) violate the Seller's articles of association or
By-Laws, (B) violate any law or regulation or any administrative decree or
order to which it is subject or (C) constitute a material default (or an
event which, with notice or lapse of time, or both, would constitute a
material default) under, or result in the breach of, any material
contract, agreement or other instrument to which the Seller is a party or
by which the Seller is bound.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or other governmental agency or body, which default might
have consequences that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the condition (financial or
other) or operations of the Seller or its properties or have consequences
that would materially and adversely affect its performance hereunder.
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any articles of
<PAGE>
association, bylaws or any other corporate restriction or any judgment,
order, writ, injunction, decree, law or regulation that would, in the
Seller's reasonable and good faith judgment, materially and adversely
affect the ability of the Seller to perform its obligations under this
Agreement or that requires the consent of any third person to the
execution of this Agreement or the performance by the Seller of its
obligations under this Agreement (except to the extent such consent has
been obtained).
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery and
performance by the Seller of or compliance by the Seller with this
Agreement or the consummation of the transactions contemplated by this
Agreement except as have previously been obtained, and no bulk sale law
applies to such transactions.
(vii) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller that would, in the Seller's good
faith and reasonable judgment, prohibit its entering into this Agreement
or materially and adversely affect the performance by the Seller of its
obligations under this Agreement.
(viii) Under generally accepted accounting principles ("GAAP")
and for federal income tax purposes, the Seller will report the transfer
of the Lehman Mortgage Loans to the Purchaser as a sale of the Lehman
Mortgage Loans to the Purchaser in exchange for consideration consisting
of (A) a cash amount equal to the Aggregate Purchase Price. The
consideration received by the Seller upon the sale of the Lehman Mortgage
Loans to the Purchaser will constitute reasonably equivalent value and
fair consideration for the Lehman Mortgage Loans. The Seller will be
solvent at all relevant times prior to, and will not be rendered insolvent
by, the sale of the Lehman Mortgage Loans to the Purchaser. The Seller is
not selling the Lehman Mortgage Loans to the Purchaser with any intent to
hinder, delay or defraud any of the creditors of the Seller.
(b) The Seller hereby makes the representations and warranties
contained in Schedule I, Schedule II, Schedule III and Schedule IV hereto for
the benefit of the Purchaser and the Trustee for the benefit of the
Certificateholders as of the Closing Date, with respect to (and solely with
respect to) each Lehman Mortgage Loan. References in such representations and
warranties to "Mortgage Loan" and "Mortgage Loans" shall be deemed to mean
"Lehman Mortgage Loan" and "Lehman Mortgage Loans," respectively.
(c) If the Seller receives written notice of a Document Defect or a
Breach pursuant to Section 2.03(a) of the Pooling and Servicing Agreement
relating to a Lehman Mortgage
<PAGE>
Loan, then the Seller, shall not later than 90 days from receipt of such notice
(or, in the case of a Document Defect or Breach relating to a Lehman Mortgage
Loan not being a "qualified mortgage" within the meaning of the REMIC Provisions
(a "Qualified Mortgage"), not later than 90 days of any party to the Pooling and
Servicing Agreement discovering such Document Defect or Breach), if such
Document Defect or Breach shall materially and adversely affect the value of the
related Lehman Mortgage Loan or the interest of the Certificateholders therein,
cure such Document Defect or Breach, as the case may be, in all material
respects, which shall include payment of losses and any Additional Trust Fund
Expenses associated therewith or, if such Document Defect or Breach (other than
omissions solely due to a document not having been returned by the related
recording office) cannot be cured within such 90-day period, repurchase the
affected Lehman Mortgage Loan at the applicable Purchase Price not later than
the end of such 90-day period; provided, however, that if such Document Defect
or Breach is capable of being cured but not within such 90-day period, such
Document Defect or Breach does not relate to the Lehman Mortgage Loan not being
treated as a Qualified Mortgage, and the Seller has commenced and is diligently
proceeding with the cure of such Document Defect or Breach within such 90-day
period, such Seller shall have an additional 90 days to complete such cure (or,
failing such cure, to repurchase the related Lehman Mortgage Loan); and
provided, further, that with respect to such additional 90-day period the Seller
shall have delivered an Officer's Certificate to the Trustee setting forth the
reason such Document Defect or Breach is not capable of being cured within the
initial 90-day period and what actions the Seller is pursuing in connection with
the cure thereof and stating that the Seller anticipates that such Document
Defect or Breach will be cured within the additional 90-day period. For a period
of two years from the Closing Date, so long as there remains any Mortgage File
relating to a Lehman Mortgage Loan as to which there is any uncured Document
Defect, the Seller shall provide the Officer's Certificate to the Trustee
described above as to the reasons such Document Defect remains uncured and as to
the actions being taken to pursue cure; provided, however, that, without
limiting the effect of the forgoing provisions of this Section 3(c), if such
Document Defect shall materially and adversely affect the value of such Lehman
Mortgage Loan or the interests of the holders of the Certificate therein, the
Seller shall in all cases on or prior to the second anniversary of the Closing
Date either cause such Document Defect to be cured or repurchase the affected
Mortgage Loan. Notwithstanding the foregoing, the delivery of a commitment to
issue a policy of lender's title insurance as described in clause (xii) of
Schedule I hereof in lieu of the delivery of the actual policy of lender's title
insurance shall not be considered a Document Defect with respect to any Mortgage
File if such actual policy of insurance is delivered to the Trustee or a
Custodian on its behalf not later than the 90th day following the Closing Date.
<PAGE>
(d) In connection with any repurchase of a Lehman Mortgage Loan
contemplated hereby, the Trustee, the Custodian, the Master Servicer and the
Special Servicer shall each tender to the Seller, upon delivery to each of them
of a receipt executed by the Seller, all portions of the Mortgage File and other
documents pertaining to such Mortgage Loan possessed by it, and each document
that constitutes a part of the Mortgage File shall be endorsed or assigned to
the extent necessary or appropriate to the Seller or its designee in the same
manner, and pursuant to appropriate forms of assignment, substantially similar
to the manner and forms pursuant to which documents were previously assigned to
the Trustee.
SECTION 4. Representations and Warranties of the Purchaser. In order to induce
the Seller to enter into this Agreement, the Purchaser hereby represents and
warrants for the benefit of the Seller as of the date hereof that:
(a) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of North Carolina. The
Purchaser has the full corporate power and authority and legal right to acquire
the Lehman Mortgage Loans from the Seller and to transfer the Lehman Mortgage
Loans to the Trustee.
(b) This Agreement has been duly and validly authorized, executed
and delivered by the Purchaser, all requisite action by the Purchaser's
directors and officers has been taken in connection therewith, and (assuming the
due authorization, execution and delivery hereof by the Seller) this Agreement
constitutes the valid, legal and binding agreement of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as such enforcement
may be limited by (A) laws relating to bankruptcy, insolvency, reorganization,
receivership or moratorium, (B) other laws relating to or affecting the rights
of creditors generally, or (C) general equity principles (regardless of whether
such enforcement is considered in a proceeding in equity or at law).
(c) Except as may be required under federal or state securities laws
(and which will be obtained on a timely basis), no consent, approval,
authorization or order of, registration or filing with, or notice to, any
governmental authority or court, is required, under federal or state law, for
the execution, delivery and performance by the Purchaser of or compliance by the
Purchaser with this Agreement, or the consummation by the Purchaser of any
transaction described in this Agreement.
(d) None of the acquisition of the Lehman Mortgage Loans by the
Purchaser, the transfer of the Lehman Mortgage Loans to the Trustee, and the
execution, delivery or performance of this Agreement by the Purchaser, conflicts
or will conflict with, results or will result in a breach of, or constitutes or
will constitute a default under (A) any term or provision of the
<PAGE>
Purchaser's Articles of Incorporation or Bylaws, (B) any term or provision of
any material agreement, contract, instrument or indenture, to which the
Purchaser is a party or by which the Purchaser is bound, or (C) any law, rule,
regulation, order, judgment, writ, injunction or decree of any court or
governmental authority having jurisdiction over the Purchaser or its assets.
(e) Under GAAP and for federal income tax purposes, the Purchaser
will report the transfer of the Lehman Mortgage Loans by the Seller to the
Purchaser as a sale of the Lehman Mortgage Loans to the Purchaser in exchange
for consideration consisting of (A) a cash amount equal to the Aggregate
Purchase Price.
SECTION 5. Closing. The closing of the sale of the Lehman Mortgage Loans (the
"Closing") shall be held at the offices of Willkie Farr & Gallagher, 787 Seventh
Avenue, New York, New York 10019-6099 at 10:00 A.M., New York time, on the
Closing Date.
The Closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller set
forth in or made pursuant to Sections 3(a) and 3(b) of this Agreement and all of
the representations and warranties of the Purchaser set forth in Section 4 of
this Agreement shall be true and correct in all material respects as of the
Closing Date; provided, however, that any material inaccuracy in any
representation and warranty set forth in or made pursuant to Section 3(b) shall
not affect the Purchaser's obligation to purchase the Mortgage Loans not
affected by such inaccuracy;
(b) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and acceptable to the
Purchaser in its reasonable discretion, shall be duly executed and delivered by
all signatories as required pursuant to the respective terms thereof;
(c) The Seller shall have delivered and released to the Trustee (or
a Custodian on its behalf) and the Master Servicer, respectively, all documents
represented to have been or required to be delivered to the Trustee and the
Master Servicer pursuant to Section 2 of this Agreement;
(d) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with in all
material respects and the Seller shall have the ability to comply with all terms
and conditions and perform all duties and obligations required to be complied
with or performed after the Closing Date; and
(e) The Seller shall have paid all fees and expenses payable by it
to the Purchaser or otherwise pursuant to this Agreement as of the Closing Date.
<PAGE>
Both parties agree to use their best efforts to perform their
respective obligations hereunder in a manner that will enable the Purchaser to
purchase the Lehman Mortgage Loans on the Closing Date.
SECTION 6. Closing Documents. The Closing Documents shall consist of the
following:
(a) This Agreement duly executed by the Purchaser and the Seller;
(b) A Certificate of the Seller, executed by a duly authorized
officer of the Seller and dated the Closing Date, and upon which the Purchaser
and the Underwriters may rely, to the effect that: (i) the representations and
warranties of the Seller in this Agreement are true and correct in all material
respects at and as of the Closing Date with the same effect as if made on such
date; and (ii) the Seller has, in all material respects, complied with all the
agreements and satisfied all the conditions on its part that are required under
this Agreement to be performed or satisfied at or prior to the date hereof;
(c) An Officer's Certificate from an officer of the Seller, dated
the Closing Date, and upon which the Purchaser may rely, to the effect that each
individual who, as an officer or representative of the Seller, signed this
Agreement or any other document or certificate delivered on or before the
Closing Date in connection with the transactions contemplated herein, was at the
respective times of such signing and delivery, and is as of the Closing Date,
duly elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such documents
and certificates are their genuine signatures;
(d) An Officer's Certificate from an officer of the Seller, dated
the Closing Date, and upon which the Purchaser and the Underwriters may rely, to
the effect that (i) such officer has carefully examined the Prospectus and
nothing has come to his attention that would lead him to believe that the
Prospectus, as of the date of the Prospectus Supplement or as of the Closing
Date, included or includes any untrue statement of a material fact relating to
the Lehman Mortgage Loans or omitted or omits to state therein a material fact
necessary in order to make the statements therein relating to the Lehman
Mortgage Loans, in light of the circumstances under which they were made, not
misleading, and (ii) such officer has examined the Memorandum and nothing has
come to his attention that would lead him to believe that the Memorandum, as of
the date thereof or as of the Closing Date, included or includes any untrue
statement of a material fact relating to the Lehman Mortgage Loans or omitted or
omits to state therein a material fact necessary in order to make the statements
therein related to the Lehman Mortgage Loans, in the light of the circumstances
under which they were made, not misleading.
<PAGE>
(e) The resolutions of the requisite committee of the Seller's board
of directors authorizing the Seller's entering into the transactions
contemplated by this Agreement, the articles of association and by-laws of the
Seller, and a certificate of good standing of the Seller issued by the Office of
the Comptroller of the Currency of the United States not earlier than sixty (60)
days prior to the Closing Date;
(f) A written opinion of counsel for the Seller, substantially in
the form of Schedule V, with any modifications required by the Purchaser, its
counsel or Rating Agencies, dated the Closing Date and addressed to the
Purchaser, the Trustee, the Underwriters and each of the Rating Agencies,
together with such other written opinions as may be required by the Rating
Agencies; and
(g) Such further certificates, opinions and documents as the
Purchaser may reasonably request.
SECTION 7. Indemnification.
(a) The Seller shall indemnify and hold harmless the Purchaser, the
Underwriters, their respective officers and directors, and each person, if any,
who controls the Purchaser or any Underwriter within the meaning of either
Section 15 of the Securities Act of 1933, as amended (the "1933 Act") or Section
20 of the Securities Exchange Act of 1934, as amended (the "1934 Act"), against
any and all losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the 1933 Act, the 1934 Act or other
federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) (i) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in (A) the Prospectus Supplement,
the Memorandum, the Diskette or, insofar as they are required to be filed as
part of the Registration Statement pursuant to the No-Action Letters, any
Computational Materials or ABS Term Sheets with respect to the Registered
Certificates, or in any revision or amendment of or supplement to any of the
foregoing or (B) any items similar to Computational Materials and ABS Term
Sheets forwarded to prospective investors in the Non-Registered Certificates, or
(ii) arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; but only if and to the extent that (I) any such untrue
statement or alleged untrue statement or omission or alleged omission arises out
of or is based upon an untrue statement or omission with respect to the Lehman
Mortgage Loans, the related Mortgagors and/or the related Mortgaged Properties
contained in the Data File (it being herein acknowledged that the Data File was
used to prepare the Prospectus Supplement including without limitation Annex A
thereto, the Memorandum, the Diskette, the Computational
<PAGE>
Materials and ABS Term Sheets with respect to the Registered Certificates and
any items similar to Computational Materials and ABS Term Sheets forwarded to
prospective investors in the Non-Registered Certificates), (II) any such untrue
statement or alleged untrue statement or omission or alleged omission of a
material fact is with respect to, or arises out of or is based upon an untrue
statement or omission of a material fact with respect to, the information
regarding the Lehman Mortgage Loans, the related Mortgagors, the related
Mortgaged Properties and/or the Seller set forth (X) in the Prospectus
Supplement and the Memorandum under the headings "Summary of the Prospectus
Supplement--The Mortgage Pool" or "Summary of the Memorandum--The Mortgage
Pool", as applicable, "Risk Factors--The Mortgage Loans" and "Description of the
Mortgage Pool" and (Y) on Annex A to the Prospectus Supplement and, to the
extent consistent therewith, on the Diskette, or (III) any such untrue statement
or alleged untrue statement or omission or alleged omission arises out of or is
based upon a breach of the representations and warranties of the Seller set
forth in or made pursuant to Section 3; provided that the indemnification
provided by this Section 7 shall not apply to the extent that such untrue
statement or omission of a material fact was made as a result of an error in the
manipulation of, or in any calculations based upon, or in any aggregation of the
information regarding the Lehman Mortgage Loans, the related Mortgagors and/or
the related Mortgaged Properties set forth in the Data File and Annex A to the
Prospectus Supplement, including without limitation the aggregation of such
information with comparable information relating to the Other Mortgage Loans in
the Trust Fund. This indemnity agreement will be in addition to any liability
which the Seller may otherwise have.
For purposes of this Agreement, "Registration Statement" shall mean
the registration statement No. 333-48943 filed by the Purchaser on Form S-3,
including without limitation exhibits thereto and information incorporated
therein by reference; "Prospectus" shall mean the prospectus dated May 11, 1998,
as supplemented by the prospectus supplement dated May 21, 1998 (the "Prospectus
Supplement"), relating to the Registered Certificates, including all annexes
thereto; "Memorandum" shall mean the private placement memorandum dated May 28,
1998, relating to the Non-Registered Certificates, including all exhibits
thereto; "Registered Certificates" shall mean the Class A-1, Class A-2, Class B,
Class C, Class D, Class E, and Class IO Certificates; "Non-Registered
Certificates" shall mean the Certificates other than the Registered
Certificates; "Computational Materials" shall have the meaning assigned thereto
in the no-action letter dated May 20, 1994 issued by the Division of Corporation
Finance of the Securities and Exchange Commission (the "Commission") to Kidder,
Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated, and Kidder
Structured Asset Corporation and the no-action letter dated May 27, 1994 issued
by the Division of Corporation Finance of the Commission to the
<PAGE>
Public Securities Association (together, the "Kidder Letters"); "ABS Term Sheets
shall have the meaning assigned thereto in the no-action letter dated February
17, 1995 issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (the "PSA Letter" and, together with the Kidder
letters, the "No-Action Letters"); "Diskette" shall mean the diskette attached
to each of the Prospectus and the Memorandum; and "Data File" shall mean the
compilation of information and data regarding the Other Mortgage Loans and the
Bank of America Mortgage Loans covered by the Agreed Upon Procedures Letter
dated May [ ], 1998 and rendered by Deloitte & Touche LLP (a "hard copy" of
which Data File was initialed on behalf of the Seller and the Purchaser).
(b) Promptly after receipt by any person entitled to indemnification
under this Section 7 (an "indemnified party") of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against the Seller (the "indemnifying party") under this Section 7, notify
the indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party will not relieve it from any liability that
it may have to any indemnified party otherwise than under this Section 7. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein, and to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel selected by the indemnifying party and satisfactory to such
indemnified party; provided, however, that if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party or parties shall have reasonably concluded that there may be
legal defenses available to it or them and/or other indemnified parties that are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assert such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of its election so to
assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof, unless (i) the indemnified party shall have employed separate
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Purchaser and the Underwriters, representing
all the indemnified parties under Section 7(a) who are parties to such action),
(ii) the indemnifying party shall not have employed counsel satisfactory to the
indemnified party
<PAGE>
to represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall only be in respect of the counsel referred to in such clause (i)
or (iii).
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under Section 7(a) hereof or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
the indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified and indemnifying parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by such parties.
(d) The Purchaser and the Seller agree that it would not be just and
equitable if contribution pursuant to Section 7(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the considerations referred to in Section 7(c) above. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in this Section 7 shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim, except where the indemnified party is required to bear such
expenses pursuant to this Section 7, which expenses the indemnifying party shall
pay as and when incurred, at the request of the indemnified party, to the extent
that the indemnifying party will be ultimately obligated to pay such expenses.
If any expenses so paid by the indemnifying party are subsequently determined to
not be required to be borne by the indemnifying party hereunder, the party that
received such payment shall promptly refund the amount so paid to the party
which made such payment. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The indemnity and contribution agreements contained in this
Section 7 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by the Purchaser,
the
<PAGE>
Underwriters, any of their respective directors or officers, or any person
controlling the Purchaser or the Underwriters, and (iii) acceptance of and
payment for any of the Certificates.
(f) Without limiting the generality or applicability of any other
provision of this Agreement, the Underwriters shall be third-party beneficiaries
of the provisions of this Section 7.
SECTION 8. Costs. The Seller shall pay (or shall reimburse the Purchaser to the
extent that the Purchaser has paid) the Seller's pro rata portion of the
aggregate of the following amounts (the Seller's pro rata portion to be
determined according to the percentage that the Lehman Balance represents of the
Initial Pool Balance): (i) the costs and expenses of printing (or otherwise
reproducing) and delivering a preliminary and final Prospectus and Memorandum
relating to the Certificates; (ii) the initial fees, costs, and expenses of the
Trustee (including reasonable attorneys' fees); (iii) the filing fee charged by
the Securities and Exchange Commission for registration of the Certificates so
registered; (iv) the fees charged by the Rating Agencies to rate the
Certificates so rated; (v) the expense of recording any assignment of Mortgage
or assignment of Assignment of Leases as contemplated by Section 2 hereof; and
(vi) the cost of obtaining a "comfort letter" from a firm of certified public
accountants selected by the Purchaser and the Seller with respect to numerical
information in respect of the Lehman Mortgage Loans included in the Prospectus
and Memorandum. All other costs and expenses in connection with the transactions
contemplated hereunder shall be borne by the party incurring such expense.
SECTION 9. Grant of a Security Interest. It is the express intent of the parties
hereto that the conveyance of the Lehman Mortgage Loans by the Seller to the
Purchaser as provided in Section 2 hereof be, and be construed as, a sale of the
Lehman Mortgage Loans by the Seller to the Purchaser and not as a pledge of the
Lehman Mortgage Loans by the Seller to the Purchaser to secure a debt or other
obligation of the Seller. However, if, notwithstanding the aforementioned intent
of the parties, the Lehman Mortgage Loans are held to be property of the Seller,
then, (a) it is the express intent of the parties that such conveyance be deemed
a pledge of the Lehman Mortgage Loans by the Seller to the Purchaser to secure a
debt or other obligation of the Seller, and (b) (i) this Agreement shall also be
deemed to be a security agreement within the meaning of Articles 8 and 9 of the
Uniform Commercial Code of the applicable jurisdiction; (ii) the conveyance
provided for in Section 2 hereof shall be deemed to be a grant by the Seller to
the Purchaser of a security interest in all of the Seller's right, title and
interest in and to the Lehman Mortgage Loans, and all amounts payable to the
holder of the Lehman 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, other than investment earnings, from time to time held or
<PAGE>
invested in the Certificate Account, the Distribution Account or, if
established, the REO Account (each as defined in the Pooling and Servicing
Agreement) whether in the form of cash, instruments, securities or other
property; (iii) the assignment to the Trustee of the interest of the Purchaser
as contemplated by Section 1 hereof shall be deemed to be an assignment of any
security interest created hereunder; (iv) the possession by the Trustee or any
of its agents, including, without limitation, the Custodian, of the Mortgage
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 Uniform Commercial Code of the applicable jurisdiction; and
(v) notifications to persons (other than the Trustee) holding such property, and
acknowledgments, receipts or confirmations from persons (other than the Trustee)
holding such property, shall be deemed notifications to, or acknowledgments,
receipts or confirmations from, financial intermediaries, bailees or agents (as
applicable) of the secured party for the purpose of perfecting such security
interest under applicable law. The Seller and the Purchaser shall, to the extent
consistent with this Agreement, take such actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the Lehman
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 and the Pooling and Servicing
Agreement.
SECTION 10. Notices. All notices, copies, requests, consents, demands and other
communications required hereunder shall be in writing and telecopied or
delivered to the intended recipient at the "Address for Notices" specified
beneath its name on the signature pages hereof or, as to either party, at such
other address as shall be designated by such party in a notice hereunder to the
other party. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 11. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement,
incorporated herein by reference or contained in the certificates of officers of
the Seller submitted pursuant hereto, shall remain operative and in full force
and effect and shall survive delivery of the Lehman Mortgage Loans by the Seller
to the Purchaser (and by the Purchaser to the Trustee).
SECTION 12. Severability of Provisions. Any part, provision, representation,
warranty or covenant of this Agreement that is prohibited or which is held to be
void or unenforceable shall be ineffective to the extent of such prohibition or
unenforceability
<PAGE>
without invalidating the remaining provisions hereof. Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or
unenforceable or is held to be void or unenforceable in any particular
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by applicable law,
the parties hereto waive any provision of law which prohibits or renders void or
unenforceable any provision hereof.
SECTION 13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but which together shall
constitute one and the same agreement.
SECTION 14. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS
AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED IN ACCORDANCE WITH
THE INTERNAL LAWS AND DECISIONS OF NEW YORK. THE PARTIES HERETO INTEND THAT THE
PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY
TO THIS AGREEMENT.
SECTION 15. Further Assurances. The Seller and the Purchaser agree to execute
and deliver such instruments and take such further actions as the other party
may, from time to time, reasonably request in order to effectuate the purposes
and to carry out the terms of this Agreement.
SECTION 16. Successors and Assigns. The rights and obligations of the Seller
under this Agreement shall not be assigned by the Seller without the prior
written consent of the Purchaser, except that any person into which the Seller
may be merged or consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Seller is a party, or any person
succeeding to all or substantially all of the business of the Seller, shall be
the successor to the Seller hereunder. The Purchaser has the right to assign its
interest under this Agreement, in whole or in part, as may be required to effect
the purposes of the Pooling and Servicing Agreement, and the assignee shall, to
the extent of such assignment, succeed to the rights and obligations hereunder
of the Purchaser. Subject to the foregoing, this Agreement shall bind and inure
to the benefit of and be enforceable by the Seller, the Purchaser, the
Underwriters (as intended third party beneficiaries hereof) and their permitted
successors and assigns, and the officers, directors and controlling persons
referred to in Section 7. This Agreement is enforceable by the Underwriters and
the other third party beneficiaries hereto in all respects to the same extent as
if they had been signatories hereof.
SECTION 17. Amendments. No term or provision of this Agreement may be waived or
modified unless such waiver or modification is
<PAGE>
in writing and signed by a duly authorized officer of the party, or third party
beneficiary, against whom such waiver or modification is sought to be enforced.
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective duly authorized officers as of the
date first above written.
SELLER
LEHMAN BROTHERS HOLDINGS INC., doing business
as Lehman Capital, a division of Lehman
Brothers Holdings Inc.
By:
----------------------------------------
Name:
Title:
Address for Notices:
3 World Financial Center
New York, NY 10285
Attention: Tricia Hall
Telecopier No.: (212) 526-3768
Telephone No.: (212) 526-7000
PURCHASER
FIRST UNION COMMERCIAL
MORTGAGE SECURITIES, INC.
By:
----------------------------------------
Name: Craig Lieberman
Title Vice President
Address for Notices:
One First Union Center
301 South College Street
Charlotte, North Carolina 28288-0600
Attention: Craig Lieberman
Telecopier No.: (704) 374-6435
Telephone No.: (704) 383-7407
<PAGE>
Exhibit A
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Lehman Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
1 IBM Corporate Office Complex Route 100 and Route 138
2 Broadmoor Austin 11501 Burnet Road
3 Fox Valley Mall Route 59 and East New York Ave.
4 Hawthorn Center Milwaukee Ave and Town Line Road
9 Musselman Portfolio (Roll-Up) Various
9a Comfort Suites (Musselman-Newport) 420 Riverboat Row
9b Comfort Suites (Musselman-Louisville) 1850 Resource Way
9c Comfort Inn (Musselman-Brooks) 149 Willabrook Drive
9d Fairfield Inn (Musselman-Shepherdsville) 362 Brenton Way
9e Sleep Inn (Musselman-Louisville) 1850 Priority Way
9f Days Inn (Musselman-Glasgow) 105 Days Inn Boulevard
9g Comfort Inn (Musselman-Glasgow) 210 Calvary Drive
9h Days Inn (Musselman-Pikeville) 518 South Mayo Trail
9i Days Inn (Musselman-Ashland) 12700 State Road 180
9j Holiday Inn Express (Musselman-Cave City) SEQ of I-65 and Kentucky Highway 90
10 Ohio Edison Office Building 76 South Main Street
12 Holiday Inn Downtown 138 Lafayette Street
14 St. Andrews Place 12100 St. Andrews Place
17 Hickory Ridge Commons Shopping Center SEC of Winchester Road and Ridgeway Road
19 1066 Third Avenue (Royale Retail Condominiums) 1066 Third Avenue
20 Richardson Highlands 401 Sherwood Drive
22 Stallings Portfolio (Loan Level) Various
22a 367 Business & Professional Park (Stallings Portfolio) 12400-12528 Lusher Road
22b Lindbergh Business Center (Stallings Portfolio) 3200-3318 North Highway 67
22c 94 Hemsath Business Center (Stallings Portfolio) 2350 Highway 94 Outer Road South
22d 201 S. Central (Stallings Portfolio) 201 S. Central
22e Medical Arts Building (Stallings Portfolio) 52 Maryland Plaza
22f Lindbergh Center (Stallings Portfolio) 3319-3391 North Highway 67
22g Brown I-270 Professional Building (Stallings Portfolio) 5494 Brown Road
22h Jamestown Business Center (Stallings Portfolio) 4401-4459 North Highway 67
22i 94 Heritage Service Station Mall (Stallings Portfolio) 2550-2600 Old Highway 94 South
22j Lindburgh Park (Stallings Portfolio) 2420-2432 North Highway 67
22k Marietta Plaza (Stallings Portfolio) 13210-13290 New Halls Ferry Road
26 Levittown Trace Apartments 3000 Ford Rd.
27 Chester Mall Route 17M
29 Statesboro Mall U.S. Highway #80 And Brannen Street
30 Days Inn & Suites Historic Savannah 201 West Bay Street
32 Sandy Mall 9405-9560 S. 700 East St. & 830 E. 9400 South St.
35 Temple City Square 8847 Las Tunas Drive and 8913 Elm Avenue
40 North Atherton Place North Atherton & Vairo Road
42 GTE Stemmons Crossing 9999 West Technology Boulevard
43 Highland Pinetree Apartments 1501 S. Highland Avenue
44 Westmont Business Park (Roll-up) Various
44a SWC of Burr Oak Drive and Chestnut Avenue (Westmont) SWC of Burr Oak Drive and Chestnut Avenue
44b 2-44 Plaza Drive (Westmont) 22-44 Plaza Drive
44c 825 North Cass Avenue (Westmont) 825 North Cass Avenue
44d 640-650 Blackhawk Drive (Westmont) 640-650 Blackhawk Drive
45 Wyndham Garden Hotel 3350 Avenue of the Arts
46 Hulen Bend Center 6080 South Hulen Road
47 Cineplex Odeon Movie Theater 6150 East Avenue
49 Golf Glen Mart Plaza 9000-9196 Golf Road
50 Clearwater Crossing Shopping Center NWC 82nd Street/Dean Road
51 Rivercrest Village Apartments 7928 La Riviera Drive
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 Somers NY 10589 178,378,814.33 1,561,831.11 6.8300 185 10/01/13
2 Austin TX 78758 154,000,000.00 933,582.22 7.0400 155 04/10/11
3 Aurora IL 60504 85,527,649.00 497,129.46 6.7500 102 11/10/06
4 Vernon Hills IL 60061 77,863,877.00 452,583.79 6.7500 126 11/10/08
9 Various KY Various 23,892,525.17 180,051.65 7.6720 116 01/01/08
9a Newport KY 41071
9b Louisville KY 40299
9c Brooks KY 40109
9d Shepherdsville KY 40165
9e Louisville KY 40299
9f Glasgow KY 42141
9g Glasgow KY 42141
9h Pikeville KY 41501
9i Ashland KY 41102
9j Cave City KY 42127
10 Akron OH 44308 22,468,036.24 150,903.88 7.0800 82 03/01/05
12 New York NY 10013 21,840,552.21 177,903.72 7.5500 56 01/01/03
14 Miramar FL 33023 20,942,733.05 138,025.22 6.8800 117 02/01/08
17 Memphis TN 38115 17,952,727.94 120,965.75 7.1000 117 02/01/08
19 New York NY 10021 17,344,007.86 117,403.24 7.1400 116 01/01/08
20 Marin City CA 94965 16,847,577.42 116,160.25 7.3260 80 01/01/05
22 St. Louis MO Various 16,277,350.35 110,311.64 7.1700 118 03/01/08
22a St. Louis County MO 63138
22b Florissant MO 63033
22c St. Charles MO 63303
22d Clayton MO 63105
22e St. Louis MO 63108
22f Florissant MO 63033
22g Hazelwood MO 63042
22h Florissant MO 63034
22i St. Charles MO 63303
22j Florissant MO 63033
22k Florissant MO 63033
26 Bristol PA 19007 14,522,217.09 98,536.04 7.1700 177 02/01/13
27 Chester NY 10918 14,488,711.07 99,013.93 7.2600 119 04/01/08
29 Statesboro GA 30458 14,288,507.76 96,100.57 7.1000 119 04/01/08
30 Savannah GA 31401 13,770,454.32 100,548.92 7.3400 118 03/01/08
32 Sandy UT 84093 13,738,706.98 91,386.77 6.9900 83 04/01/05
35 Temple City CA 91780 13,269,824.24 91,405.09 7.3400 119 04/01/08
40 Patton Township PA 16802 12,469,243.47 88,666.62 7.0400 298 03/01/23
42 Dallas TX 77071 12,400,000.00 83,582.95 7.1300 120 05/01/08
43 Fullerton CA 92632 12,389,735.13 82,081.54 6.9500 119 04/01/08
44 Westmont IL 60559 12,218,749.98 83,732.84 7.2700 81 02/01/05
44a Westmont IL 60559
44b Westmont IL 60559
44c Westmont IL 60559
44d Westmont IL 60559
45 Costa Mesa CA 92626 12,204,210.32 89,255.38 7.3400 117 02/01/08
46 Fort Worth TX 76132 12,168,124.07 82,234.84 7.1300 117 02/01/08
47 Hodgkins IL 60525 12,124,123.68 93,793.98 7.9900 297 02/01/23
49 Niles IL 60714 11,863,983.65 82,799.48 7.4500 80 01/01/05
50 Indianapolis IN 46250 11,569,846.73 78,425.57 7.1600 177 02/01/13
51 Sacramanto CA 95826 11,564,174.06 79,904.97 7.3480 116 01/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 N 0.0400 0.0050 N - 30/360 Lehman Brothers
2 Y 0.0400 0.0050 Y 2.0000 Act/360 Lehman Brothers
3 N 0.0400 0.0050 Y 2.0000 Act/360 Lehman Brothers
4 N 0.0400 0.0050 Y 2.0000 Act/360 Lehman Brothers
9 296 Both 0.0900 0.0050 N - Act/360 Lehman Brothers
9a N
9b N
9c Y
9d N
9e N
9f N
9g N
9h Y
9i N
9j N
10 N 0.1150 0.0050 Y 2.0000 Act/360 Lehman Brothers
12 236 N 0.0900 0.0050 N - Act/360 Lehman Brothers
14 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
17 N 0.0950 0.0050 Y 2.0000 Act/360 Lehman Brothers
19 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
20 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
22 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
22a N
22b N
22c N
22d N
22e N
22f N
22g N
22h N
22i N
22j N
22k N
26 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
27 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
29 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
30 298 N 0.0900 0.0050 N - Act/360 Lehman Brothers
32 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
35 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
40 Y 0.1400 0.0050 N - 30/360 Lehman Brothers
42 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
43 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
44 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
44a N
44b N
44c N
44d N
45 297 N 0.0900 0.0050 N - Act/360 Lehman Brothers
46 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
47 N 0.0900 0.0050 N - 30/360 Lehman Brothers
49 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
50 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
51 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1 1.32 63.7 No Y N
2 1.50 76.2 No Y Y
3 1.91 61.5 No Y Y
4 2.00 58.8 No Y Y
9 1.41 68.2 No Y N
9a 2.08 34.1
9b 3.12 92.8
9c 1.65 83.2
9d 0.96 63.6
9e 1.73 75.4
9f 1.21 80.5
9g 1.15 73.4
9h 1.64 82.8
9i 1.22 73.4
9j 0.64 83.1
10 1.42 74.2 No Y Y
12 1.53 55.0 No Y Y
14 1.33 77.6 No Y Y
17 1.25 78.2 No Y Y
19 1.21 74.4 No N Y
20 1.22 78.4 No Y Y
22 1.44 74.7 No N Y
22a 1.45 76.8
22b 1.39 69.9
22c 1.38 74.7
22d 1.45 73.3
22e 1.61 76.8
22f 1.40 76.8
22g 1.43 76.8
22h 1.42 76.8
22i 1.48 83.8
22j 1.44 76.8
22k 1.39 61.6
26 1.27 79.8 No Y Y
27 1.40 74.7 No Y Y
29 1.41 71.8 No Y Y
30 1.40 74.4 No N Y
32 1.29 72.3 No Y Y
35 1.29 79.9 No Y Y
40 1.42 75.1 No Y N
42 1.27 71.3 No Y Y
43 1.33 78.2 No N Y
44 1.31 72.6 No Y Y
44a 0.00 72.6
44b 0.00 72.6
44c 0.00 72.6
44d 0.00 72.6
45 1.40 56.8 No Y Y
46 1.21 74.9 No Y Y
47 1.25 74.4 No Y N
49 1.20 78.6 No Y Y
50 1.31 78.7 No Y Y
51 1.24 79.8 No Y Y
</TABLE>
B-14
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Lehman Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
52 Super K-Mart Center 111 Constitution Drive
54 Market at Wolfcreek Germantown Parkway Highway 64 on Stage Road
59 Concorde Centre II Office Building 2999 NE 191st Street
63 Maplewood Center 8200-8300 Shoppers Square
66 Inverrary 441 Apartments 1196 NW 40th Avenue
70 Hampton Inn Pensacola Beach Two Via Del Luna
73 North Willow Commons Shopping Center 1410-1520 West 86th Street
74 International Club Apartments 1900 SW 122nd Avenue
75 Village Green Apartments 222 South Clovis Avenue
80 Briarcliffe Lakeside Apartments 1750 East 22nd Street
81 Daytona Beach Hilton Oceanfront Resort 2637 S. Atlantic Avenue
83 North Oaks Plaza 7151 Natural Bridge Road
87 1616 Walnut Street 1616 Walnut Street
89 Hampton Inn (Louisville) 800 Phillips Lane
92 White Marlin Mall, Phase I North Side of U.S. Route 50
97 Classic Portfolio (Roll-up) Various
97a 2 Horatio Street (Classic Portfolio) 2 Horatio Street
97b 162 W. 56th Street (Classic Portfolio) 162 W. 56th Street
97c 400 E. 52nd Street (Classic Portfolio) 400 E. 52nd Street
97d 45 E. 66th Street (Classic Portfolio) 45 E. 66th Street
97e 129 E. 82nd Street (Classic Portfolio) 129 E. 82nd Street
98 Oak Hills Medical Plaza 7345 Medical Center Drive
100 Kensington Club Apartments 14250 Kimberley Lane
102 West Georgia Commons North Side of Lafayette Parkway
103 Colleyville Court 4904 Colleyville Road
104 Tlaquepaque Arts & Crafts Village 336 State Highway 179
106 Glen Harbor Plaza S/W/C School Street and Highland Road
107 Hulen Fashion Center 5200 South Hulen Street
110 City Place 133 Stuart Street
111 Sunscape West Apartments 8840 19th St.
114 Le Med Apartments 950 W. Sierra Madre Avenue
116 Westminster Plaza 12109-12121 Westheimer Road
119 City Center Building 227 Bronough Street
120 Dublin Mall U.S. Highway 80 and Shamrock Drive
122 New Market Mall NEQ I 270 & Sawmill Road
123 Highgate Apartments 5710 Fourth St.
124 Playa Blanca Apartments 1905-79 Avenida Del Mexico
125 Minges Brook Mall 5700 Beckley Road
131 Pelham at Hyland Business Center Pelham Road at Hyland Road
136 Officemax and Best Buy 2420 & 2452 East Springs Drive
137 Two Executive Boulevard Two Executive Boulevard
143 Linden Court Apartments 372 S. Ironwood Ave.
144 Serra Commons Apartments 1580 Southgate Boulevard
145 A & P Grocery Store 179 Stonington Road (U.S. Route 1)
148 Holiday Inn City Center 175 East Town Street
149 53, 53-West, and 102 Commerce Center 10551 and 10791 NW 53rd Street and 5401 and 5405 N
151 Emerald Apartments 964 President Avenue
152 MacArthur Plaza I & II 7945 MacArthur Boulevard and 6500 Seven Locks Road
154 Evergreen Plaza 1710 Route 38
155 21 DuPont Circle 21 DuPont Circle
156 1-3 Parklands Drive (Parkland Office Park) 1-3 Parklands Drive
157 Payne Ranch Centre SWC of Grand Ave. & Peyton Drive
161 Wickes Shopping Center 800 Central Expressway North
162 Ashby Square West Shopping Center SEC of West Broad Street & Tuckernuck Drive
164 Commerce Park of Palm Beach County 3111 Fortune Way
172 73 Spring Street Limited Partnership 67-73 Spring Street
174 Club at Woodland Pond 13801 North 37th Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
52 West Monroe LA 71292 11,283,800.93 94,734.07 8.3400 254 07/01/19
54 Memphis TN 38101 10,947,916.37 78,400.40 7.6825 173 10/01/12
59 Aventura FL 33180 10,500,000.00 72,199.14 7.3300 120 05/01/08
63 Manassas Park VA 20111 9,745,742.13 67,657.93 7.3960 116 01/01/08
66 Lauderhill FL 33133 9,586,461.99 64,579.81 7.1100 118 03/01/08
70 Pensacola Beach FL 32561 9,250,000.00 65,731.55 7.0600 120 05/01/08
73 Washington Township IN 46278 9,205,383.81 61,469.42 7.0100 177 02/01/13
74 Miami FL 33175 9,186,994.22 61,826.94 7.1000 118 03/01/08
75 Frenso CA 93727 9,177,123.74 63,824.51 7.4200 116 01/01/08
80 Wheaton IL 60187 8,776,084.48 57,956.81 6.9000 117 02/01/08
81 Daytona Beach Shores FL 32118 8,281,860.32 59,886.06 7.2300 118 02/29/08
83 Northwoods MO 63121 8,093,897.78 56,220.97 7.4250 239 04/01/18
87 Philadelphia PA 19103 7,794,129.65 54,165.35 7.4300 119 04/01/08
89 Louisville KY 40209 7,771,500.87 57,641.31 7.5000 117 02/01/08
92 Ocean City MD 21842 7,743,942.22 52,816.11 7.2400 119 04/01/08
97 New York NY Various 7,201,769.35 49,645.50 7.3300 117 02/01/08
97a New York NY 10001
97b New York NY 10001
97c New York NY 10001
97d New York NY 10021
97e New York NY 10028
98 West Hills CA 91307 7,181,443.42 48,921.50 7.2100 117 02/01/08
100 Houston TX 77079 7,131,286.58 48,146.75 7.1200 117 02/01/08
102 LaGrange GA 30241 7,094,294.06 47,714.27 7.1000 119 04/01/08
103 Collyville TX 76034 7,081,449.20 47,857.98 7.1300 117 02/01/08
104 Sedona AZ 86336 7,055,984.78 49,447.89 7.5100 118 03/01/08
106 Glen Cove NY 11542 6,990,558.40 47,942.40 7.2900 70 03/01/04
107 Fort Worth TX 76132 6,968,150.86 51,619.17 7.1200 129 02/01/09
110 Boston MA 02116 6,892,159.81 51,080.19 7.5200 119 04/01/08
111 Rancho Cucamonga CA 91701 6,839,980.49 45,389.35 6.9600 118 03/01/08
114 Azusa CA 91702 6,744,467.08 44,907.92 7.0000 119 04/01/08
116 Houston TX 77077 6,690,963.03 45,887.73 7.2900 118 03/01/08
119 Tallahassee FL 32301 6,656,983.36 44,140.29 6.9400 117 02/01/08
120 Dublin GA 31021 6,594,695.89 44,354.11 7.1000 119 04/01/08
122 Columbus OH 43235 6,584,429.79 44,978.88 7.2400 57 02/01/03
123 Lubbock TX 79416 6,583,249.29 45,247.68 7.3000 117 02/01/08
124 San Diego CA 92154 6,582,428.06 43,998.65 7.0200 117 02/01/08
125 Battle Creek MI 49015 6,574,953.93 45,922.40 7.4500 235 12/01/17
131 Greenville SC 29615 6,402,356.16 43,986.27 7.3000 117 02/01/08
136 Madison WI 53704 6,320,000.00 42,429.81 7.0900 120 05/01/08
137 Montebello NY 10901 6,295,095.15 43,019.85 7.2600 119 04/01/08
143 Rialto CA 92376 6,190,931.25 41,082.33 6.9600 118 03/01/08
144 Daly City CA 94014 6,177,199.24 42,631.87 7.3300 115 12/01/07
145 Stonington CT 06355 6,163,226.67 45,600.94 7.4200 293 10/01/22
148 Columbus OH 43215 6,073,664.24 46,677.41 7.9000 80 01/01/05
149 Sunrise FL 33321 5,993,027.80 43,872.20 7.3800 119 04/01/08
151 Toms River NJ 08753 5,984,430.12 40,605.51 7.1700 177 02/01/13
152 Cabin John MD 20818 5,983,970.74 39,918.15 7.0000 117 02/01/08
154 Mount Holly NJ 08060 5,982,208.81 42,170.84 7.5530 116 01/01/08
155 Washington DC 20036 5,795,439.34 39,408.99 7.2100 119 04/01/08
156 Darien CT 06820 5,792,389.77 40,158.03 7.4000 118 03/01/08
157 Chino Hills CA 91709 5,785,128.07 39,526.89 7.2400 177 02/01/13
161 Plano TX 75074 5,707,136.81 38,831.45 7.2100 118 03/01/08
162 Richmond VA 23220 5,685,607.37 39,193.83 7.3300 117 02/01/08
164 Wellington FL 33414 5,585,217.47 37,520.58 7.0700 117 02/01/08
172 New York NY 10012 5,382,520.27 36,326.14 7.1100 116 01/01/08
174 Tampa FL 33613 5,355,892.91 36,892.42 7.3400 119 04/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
52 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
54 353 N 0.1500 0.0050 N - Act/360 Lehman Brothers
59 360 N 0.1150 0.0050 N - Act/360 Lehman Brothers
63 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
66 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
70 300 N 0.1500 0.0050 N - Act/360 Lehman Brothers
73 N 0.0950 0.0050 Y 2.0000 Act/360 Lehman Brothers
74 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
75 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
80 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
81 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
83 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
87 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
89 297 N 0.1400 0.0050 N - Act/360 Lehman Brothers
92 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
97 Both 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
97a N
97b N
97c Y
97d N
97e N
98 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
100 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
102 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
103 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
104 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
106 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
107 Y 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
110 299 Y 0.0900 0.0050 N - Act/360 Lehman Brothers
111 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
114 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
116 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
119 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
120 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
122 N 0.0900 0.0050 Y 2.0000 30/360 Lehman Brothers
123 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
124 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
125 N 0.0900 0.0050 Y 2.0000 30/360 Lehman Brothers
131 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
136 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
137 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
143 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
144 355 N 0.1650 0.0050 N - Act/360 Lehman Brothers
145 Y 0.0400 0.0050 N - 30/360 Lehman Brothers Y
148 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
149 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
151 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
152 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
154 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
155 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
156 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
157 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
161 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
162 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
164 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
172 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
174 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
52 K-Mart 1.02 93.3 No Y N
54 1.44 71.4 LB-H Y N
59 1.30 73.4 No Y Y
63 1.45 73.3 No Y Y
66 1.36 79.9 No N Y
70 2.20 60.9 No Y Y
73 1.32 78.7 No Y Y
74 1.31 79.9 No N Y
75 1.22 78.3 No N Y
80 1.25 79.8 No Y Y
81 1.48 59.2 No Y Y
83 1.30 74.9 No N Y
87 1.42 71.5 No Y Y
89 1.49 74.7 No Y Y
92 1.35 71.7 No Y Y
97 1.34 72.0 No Y Y
97a 0.00 0.0
97b 0.00 0.0
97c 0.00 0.0
97d 0.00 0.0
97e 0.00 0.0
98 1.34 68.4 No Y Y
100 1.26 77.9 No Y Y
102 1.32 68.5 No Y Y
103 1.29 74.8 No Y Y
104 1.25 73.5 No Y Y
106 1.32 69.9 No Y Y
107 1.28 72.6 No Y Y
110 1.50 62.7 No Y Y
111 1.30 72.0 No Y Y
114 1.27 78.9 No N Y
116 1.36 73.5 No Y Y
119 1.47 73.2 No Y Y
120 1.30 71.7 No Y Y
122 1.21 74.8 No N N
123 1.37 79.3 No Y Y
124 1.32 79.1 No Y Y
125 1.30 78.5 No Y N
131 1.28 74.0 No Y Y
136 1.34 79.0 No Y Y
137 1.32 74.9 No Y Y
143 1.41 79.9 No Y Y
144 1.23 76.6 No Y Y
145 A & P 1.05 96.3 No Y N
148 1.64 47.1 No Y N
149 1.38 74.9 No Y Y
151 1.45 79.8 No Y Y
152 1.47 78.0 No Y Y
154 1.31 73.9 No N Y
155 1.31 72.4 No Y Y
156 1.40 72.4 No Y Y
157 1.58 60.3 No Y Y
161 1.52 73.6 No Y Y
162 1.36 77.9 No Y Y
164 1.54 60.7 No N Y
172 1.39 74.8 No Y Y
174 1.30 79.9 No Y Y
</TABLE>
B-15
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Lehman Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
178 Whole Foods Market 711 University Avenue
179 One Sentry Parkway One Sentry Parkway
187 Budgetel Inn 3701 SW 38th Avenue
188 Hillside Village Center E/S Route 111
191 Thrifty's (Roll-Up) Various
191a Thrifty's Neighborhood Center (South Pasadena) 900-914 Fair Oaks Avenue
191b 2421 West Rosecrans Avenue (Thrifty's-Gardena) 2421 West Rosecrans Avenue
191c Thrifty Drug Store No. 650 (Thrifty's Calexico) 244 E. 3rd Street
191d 72 Springstowne Center (Thrifty's Vallejo) 72 Springtowne Center
193 Tiffany Corner Shopping Center NEQ of Cactus Road and 67th Avenue
194 Timbers of Pine Hollow Apartments 2020 Plantation Drive
200 Southpoint Shopping Center 12855 Gulf Freeway
201 Provincial Towers Apartments 34 South Main Street
202 Royal Palms Mobile Home/RV Park 7901 E. Ben White Boulevard
204 Park Plaza - Salem 123-129 South Broadway
208 Village Faire Shoppes 1100-1198 South Coast Highway
209 South Trust Building 402 Kentucky Avenue
210 South Ridge Apartments 440 West Oak Ridge Road
214 Minges Creek Plaza 5420 Beckley Road
215 TransFlorida Bank Plaza 1347-1671 South University Drive
216 Chesapeake Square U.S. Highway No. 13
217 Orchard Plaza Plank Road and Orchard Avenue
220 J.P. Morgan Building 109 Royal Palm Way
224 Kingston Apartments 2701-2731 North Andrews Avenue
225 Glengary Shopping Center 5950-6010 Westerville Road
226 1696 and 1700 to 1712 Newport Boulevard 1696 and 1700 to 1712 Newport Boulevard
230 Walgreens Pharmacy (Chicago) NWC West Fullerton Avenue & North Central Avenue
231 Karl Plaza Shopping Center 1620 Dublin Granville Road
232 Villa Serrano 201 South Magnolia
233 Kendale Plaza Shopping Center S/E Corner of Lee Avenue and Main Street
235 Best Buy (Little Rock) Chenal Parkway & Bowman Road
236 Alice Nettell Tower 550 Third Avenue North
241 Oakwood Apartments 4050 NE 1st Avenue
243 5210 Maryland Way Office Building NEC of Maryland Way and Westwood Place
245 Fashion Village and East Colonial Shopping Centers 3817 & 3907-3915 East Colonial Drive
252 Merrill Crossing Shopping Ctr. 9119 Merrill Road
253 River Creek Apartments 2525 Center West Parkway
257 Versailles of Rockford 5145 East State Street
258 Lynnwood Manor Health Care Center 5821 188th Street S.W.
259 Tri-County Square U.S. Highway 25E
260 Bethesda Court Hotel 7740 Wisconsin Avenue
262 Roswell Mill Office Buildings 85 Mill Street
263 Highland Tech Center 8925,8955,8985 East Nichols Avenue
264 Stor-All Properties Various
264a 1880 Dr. Andre's Way 1880 Dr. Andre's Way
264b 7388 Central Industrial Way 7388 Central Industrial Way
264c 330-358 Northeast 4th Street 330-358 Northeast 4th Street
265 Parole Office Park 130, 132 and 134 Holiday Court
266 McEvers Corners 975 Dawsonville Road
268 Courtyards Apartments 1906 Sam Houston Drive
269 Miami Gardens Plaza 18351 Northwest 27th Avenue
271 Webtron Building 2030 W. McNab Road
273 Santa Fe Square Northeast Corner of Southern Avenue & Gilbert Road
276 Best Buy (Sioux Falls) 2104 W. 41st Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
178 San Diego CA 92103 5,331,911.30 36,727.23 7.3400 119 04/01/08
179 Whitpain Township PA 19422 5,292,378.31 35,367.88 7.0300 118 03/01/08
187 Ocala FL 34474 4,994,436.22 37,438.78 7.6500 119 04/01/08
188 Smithtown NY 11787 4,993,729.36 35,020.64 6.9000 119 04/01/08
191 Various CA Various 4,936,933.47 33,165.45 7.0700 117 02/01/08
191a South Pasadena CA 91030
191b Gardena CA 90249
191c Calexico CA 92231
191d Vallejo CA 94591
193 Glendale AZ 85304 4,904,313.30 33,091.81 7.1161 81 02/01/05
194 Conroe TX 77301 4,896,093.16 33,061.84 7.1400 119 04/01/08
200 Houston TX 77034 4,735,219.11 32,596.91 7.3100 80 01/01/05
201 Wilkes-Barre PA 18701 4,662,868.47 31,638.46 7.1700 177 02/01/13
202 Austin TX 78741 4,600,000.00 31,598.81 7.3200 120 05/01/08
204 Salem NH 03079 4,588,483.58 31,786.73 7.3800 117 02/01/08
208 Laguna Beach CA 92651 4,489,166.80 31,804.30 7.6100 177 02/01/13
209 Lakeland FL 33801 4,488,810.52 31,218.51 7.4200 117 02/01/08
210 Orlando FL 32809 4,485,830.01 30,697.93 7.2500 116 01/01/08
214 Battle Creek MI 49015 4,445,732.34 32,043.08 7.4900 119 04/01/08
215 Plantation FL 33324 4,393,961.09 29,926.28 7.2200 118 03/01/08
216 Onley VA 23418 4,393,749.31 29,510.09 7.0800 118 03/01/08
217 Logan Township PA 16601 4,389,461.37 31,690.20 7.2100 298 03/01/23
220 Palm Beach FL 33480 4,196,597.85 28,112.15 7.0600 119 04/01/08
224 Wilton Manors FL 33311 4,180,514.34 30,901.16 7.4500 56 01/01/03
225 Blendon Township OH 43081 4,174,404.10 28,713.70 7.3200 118 03/01/08
226 Costa Mesa CA 92627 4,164,473.16 28,758.54 7.3600 118 03/01/08
230 Chicago IL 60630 4,119,422.58 30,785.00 7.3600 236 01/01/18
231 Columbus OH 43229 4,114,484.43 28,301.54 7.3200 118 03/01/08
232 Anaheim CA 92804 4,111,868.60 29,639.51 7.7768 115 12/01/07
233 Sanford NC 27330 4,094,344.90 27,830.32 7.2000 118 03/01/08
235 Little Rock AR 72211 4,092,586.34 33,004.26 7.4900 239 04/01/18
236 Virginia MN 55792 4,085,108.18 29,397.77 7.1600 297 02/01/23
241 Oakland Park FL 33334 3,990,036.80 27,722.49 7.4100 177 02/01/13
243 Brentwood TN 37027 3,987,379.97 27,259.93 7.2400 116 01/01/08
245 Orlando FL 32803 3,932,520.25 28,736.26 7.9100 113 10/01/07
252 Jacksonville FL 32211 3,790,289.55 25,948.48 7.2600 117 02/01/08
253 Augusta GA 30901 3,788,034.64 25,922.70 7.2500 116 01/01/08
257 Rockford IL 61108 3,750,108.50 25,243.05 7.0900 117 02/01/08
258 Lynnwood WA 98037 3,746,037.63 28,868.62 7.9700 119 04/01/08
259 Corbin KY 40701 3,688,584.07 25,499.53 7.3530 116 01/01/08
260 Bethesda MD 28014 3,636,395.34 26,641.67 7.3600 117 02/01/08
262 Roswell GA 30075 3,614,244.75 25,470.75 7.5500 116 01/01/08
263 Englewood CO 80112 3,597,169.25 24,460.75 7.2100 239 04/01/18
264 Various FL Various 3,594,923.24 24,217.43 7.1100 118 03/01/08
264a Delray Beach FL 33445
264b Riviera Beach FL 33404
264c Delray Beach FL 33445
265 Annapolis MD 21401 3,594,810.39 23,999.26 7.0200 118 03/01/08
266 Gainesville GA 30504 3,591,540.48 26,206.88 7.3300 298 03/01/23
268 Victoria TX 77901 3,591,078.89 25,023.98 7.4400 117 02/01/08
269 Miami FL 33056 3,591,048.41 24,974.81 7.4200 117 02/01/08
271 Ft. Lauderdale FL 33309 3,547,375.75 24,870.75 7.5200 119 04/01/08
273 Mesa AZ 85204 3,496,073.89 26,092.78 7.6000 83 04/01/05
276 Sioux Falls SD 57105 3,475,000.00 24,131.36 7.4300 120 05/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
178 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
179 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
187 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
188 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
191 357 Both 0.1400 0.0050 N - Act/360 Lehman Brothers
191a Both
191b Both
191c Both
191d Both
193 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
194 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
200 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
201 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
202 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
204 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
208 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
209 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
210 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
214 323 N 0.1400 0.0050 N - Act/360 Lehman Brothers
215 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
216 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
217 N 0.1400 0.0050 N - 30/360 Lehman Brothers
220 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
224 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
225 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
226 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
230 282 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
231 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
232 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
233 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
235 N 0.1400 0.0050 N - Act/360 Lehman Brothers
236 N 0.1400 0.0050 N - 30/360 Lehman Brothers
241 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
243 N 0.1500 0.0050 Y 2.0000 30/360 Lehman Brothers
245 353 N 0.0900 0.0050 N - Act/360 Lehman Brothers
252 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
253 356 N 0.0900 0.0050 N - 30/360 Lehman Brothers
257 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
258 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
259 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
260 297 N 0.0900 0.0050 N - Act/360 Lehman Brothers
262 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
263 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
264 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
264a N
264b N
264c N
265 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
266 N 0.1400 0.0050 N - 30/360 Lehman Brothers
268 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
269 357 N 0.1700 0.0050 N - Act/360 Lehman Brothers
271 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
273 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
276 360 N 0.1400 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
178 1.25 79.9 No N Y
179 1.36 57.7 No Y Y
187 1.49 74.5 No Y N
188 1.72 60.2 No Y Y
191 1.35 73.1 No Y Y
191a 1.20 66.5
191b 1.41 80.3
191c 1.52 79.8
191d 1.51 80.2
193 1.31 74.7 No N Y
194 1.28 75.3 No Y Y
200 1.30 75.2 No Y Y
201 1.23 77.7 No Y Y
202 1.37 78.6 No Y Y
204 1.26 78.4 No Y Y
208 1.26 56.1 No Y N
209 1.26 70.7 No Y Y
210 1.25 73.5 No N Y
214 1.40 74.0 No N Y
215 1.49 72.0 No Y Y
216 1.28 75.1 No Y Y
217 1.31 74.4 No Y N
220 1.28 71.1 No Y Y
224 1.27 78.4 No Y Y
225 1.32 74.5 No Y Y
226 1.53 74.6 No Y Y
230 Walgreen Company Y Y 1.02 94.7 No Y N
231 1.30 73.5 No Y Y
232 1.20 76.6 No N N
233 1.38 73.4 No Y Y
235 1.26 74.4 No Y Y
236 1.31 69.2 No Y N
241 1.31 79.8 No Y Y
243 1.36 79.0 No Y N
245 1.33 76.4 No Y N
252 1.40 73.6 No Y Y
253 1.41 74.3 No Y N
257 1.23 79.8 No Y Y
258 2.29 47.4 No Y N
259 1.46 75.3 LB-B Y Y
260 1.58 66.1 No Y Y
262 1.31 65.9 No Y Y
263 1.26 74.9 No N Y
264 1.31 74.1 No Y Y
264a 0.00 0.0
264b 0.00 0.0
264c 0.00 0.0
265 1.34 78.2 No Y Y
266 1.25 74.8 No Y N
268 1.26 79.8 No Y Y
269 1.66 71.8 No Y Y
271 1.35 74.7 No N Y
273 2.00 30.9 No N Y
276 1.25 77.2 No N Y
</TABLE>
B-16
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Lehman Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
277 Parkway Nursing Home 525 13th Street
279 Terrace View Apartments 525 Vaughn Avenue
282 Walgreens (Las Vegas) 9420 Lake Mead Boulevard
284 Fidelity Federal Bank Building 6350 Laurel Canyon Boulevard
285 White Mountain Village 20 East White Mountain Boulevard
287 Shepherdsville Square Kentucky Highway 44
289 100 Broadway 64, 100 & 102 Broadway
293 Green Center (MCG) East Gude Drive and Taft Street
295 Walgreens Pharmacy (Chicago Heights) SWC of Western Avenue and Lincoln Highway
296 Everett I-5 Mini-Storage 13026 4th Avenue West
298 Marketplace Shopping Center (Williamsburg-Loan Level) Various
298a Rivergate Business Center (Williamsburg-Prop Level) 309 McLaws Circle
298b Marketplace Shopping Center (Williamsburg-Prop Level) 240 McLaws Circle
302 Sussex Downs Apartments 1125 Magnoilia Drive
303 Foothills Villas Apartments 2601-2675 West Second Street
306 Manchester Square Kentucky Highway 8 at U.S. Highway 421
310 Swall Towers East 310 S. Swall Drive
312 Hillside Village Plaza 50 Route 111
314 Kaiser Permanente Health Center 65 Kane Street
316 Swall Towers West 311 S. Swall Drive
319 Salt Lake Medical Plaza Office Building 24 South 1100 East
322 Carriage Hills Apartments 114-116 Surrey Circle
323 Village on the Pike Shopping Center 2940 Covington Pike
326 General Cinema 4016 East 82nd Street
328 Valencia Gardens Apartments 2704 to 2734 Juniper Avenue
331 Woodmere Apartments 2135 West County Line Road
334 Rain Forest Apartments 17714 Red Oak Drive
335 Nexstar Pharmaceuticals Building 2860 Wilderness Place
341 Timberfalls Apartments 2600 East 113th Ave.
344 University Village Shopping Center 2441, 2529-2539 University Boulevard
347 Greenbrier Valley Mall U.S. Route 219
352 Maple Plaza Shopping Center 1102-1198 E. West Maple Road
355 West Court Office Building 2448 Holly Avenue
357 Paradise Shopping Plaza NEQ of 40th Street and Thunderbird Road
358 Century Analysis, Inc., Building 60 Berry Drive
361 Dolly Creek Shopping Center 2409 Acton Road
363 Raintree Apartments 7601 North 9th Avenue
367 Park East Apartments 1845 Summit Place, N.W.
368 Shadow Trail Apartments 15520 Foothill Boulevard
369 Inn at Saratoga 20645 Fourth Street
371 Marketplace at Ken Caryl 10143 West Chatfield Avenue
378 K-Mart Plaza Shopping Center (Galveston) 6105-6327 Stewart Road
379 303 Winding Road 303 Winding Road
383 Hillside Apartments 501 Eric Avenue
384 Walgreen Store (Wolfcreek) SEC of Germantown Parkway & U.S. Highway 64
388 Miramar/Chapparone Auto Center 6590-6598 Miramar Road
390 Jefferson Centre 105 East Jefferson Boulevard
393 Central Park Professional Center 1450 Madruga Avenue
403 Eckerd Drug Store (Lexington) NWC of Columbia Avenue and Old Chapin Road
406 1803 Park Center Drive 1803 Park Center Drive
414 Wanamassa Gardens Apartments 1515 Allen Avenue
416 River Oaks Apartments 3001 Medical Arts Street
418 Timm Office Building 136 West Canon Perdido Street
420 Hillcroft Plaza Shopping Center 6401 Hillcroft
422 Olde Towne Shopping Center 210-800 Olde Towne Road
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
277 Snohomish WA 98290 3,446,354.62 26,559.13 7.9700 119 04/01/08
279 Toms River NJ 08753 3,431,073.27 23,280.49 7.1700 177 02/01/13
282 Las Vegas NV 89134 3,396,544.93 27,051.35 7.2000 234 11/01/17
284 North Hollywood CA 91606 3,392,923.73 25,103.59 7.4900 118 03/01/08
285 Pinetop-Lakeside AZ 85935 3,390,568.02 22,120.18 6.7800 117 02/01/08
287 Shepardsville KY 41065 3,389,509.68 23,432.00 7.3530 116 01/01/08
289 Menands NY 12204 3,380,435.75 27,099.85 7.3600 117 02/01/08
293 Rockville MD 20850 3,343,708.47 26,335.70 7.1800 119 04/01/08
295 Chicago Heights IL 60630 3,297,412.39 24,512.00 7.4300 236 01/01/18
296 Everett WA 98204 3,295,515.58 22,534.20 7.2600 118 03/01/08
298 Williamsburg VA 23185 3,291,905.50 23,074.08 7.5000 117 02/01/08
298a Williamsburg VA 23185
298b Williamsburg VA 23185
302 Franklin TN 37064 3,266,130.06 21,612.98 6.9200 117 02/01/08
303 San Bernadino CA 92410 3,264,848.02 27,132.04 7.7700 234 11/01/17
306 Manchester KY 40165 3,239,972.50 22,398.23 7.3530 116 01/01/08
310 Los Angeles CA 90048 3,197,448.60 21,591.40 7.1400 119 04/01/08
312 Smithtown NY 11787 3,191,710.26 21,677.91 7.1800 117 02/01/08
314 West Hartford CT 06119 3,184,959.64 22,704.46 7.6500 113 10/01/07
316 Los Angeles CA 90048 3,147,488.47 21,254.03 7.1400 119 04/01/08
319 Salt Lake City UT 84102 3,134,338.76 22,379.95 7.0700 117 02/01/08
322 Chamblee GA 30341 3,113,343.36 26,667.99 8.1200 51 08/01/02
323 Memphis TN 38134 3,097,528.33 20,916.67 7.1400 119 04/01/08
326 Indianapolis IN 46250 3,090,238.46 21,147.46 7.2500 176 01/01/13
328 Boulder CO 80301 3,071,470.37 20,058.78 6.7900 117 02/01/08
331 Jackson NJ 08527 3,032,111.26 20,573.46 7.1700 177 02/01/13
334 Houston TX 77090 2,997,655.06 20,444.95 7.2400 119 04/01/08
335 Boulder CO 80301 2,997,612.80 20,262.20 7.1500 119 04/01/08
341 Tampa FL 33612 2,955,617.80 19,514.37 6.9100 118 03/01/08
344 Houston TX 77005 2,936,468.90 23,757.60 9.0100 170 07/01/12
347 Fairlea WV 24901 2,891,052.37 19,986.12 7.3530 116 01/01/08
352 Walled Lake MI 48390 2,792,929.95 19,253.10 7.3300 117 02/01/08
355 Annapolis MD 21401 2,745,987.29 18,240.45 6.9700 118 03/01/08
357 Phoenix AZ 85032 2,697,988.17 18,841.83 7.4800 119 04/01/08
358 Pacheco CA 94553 2,696,563.47 18,915.78 7.5200 118 03/01/08
361 Vestavia Hills AL 35243 2,672,871.41 18,067.13 7.1500 119 04/01/08
363 Pensacola FL 32514 2,652,844.86 17,625.65 6.9600 81 02/01/05
367 Washington DC 20009 2,596,160.04 17,158.40 6.9200 118 03/01/08
368 Sylmar CA 91342 2,593,160.14 17,455.30 7.0900 117 02/01/08
369 Saratoga CA 95070 2,588,127.92 19,298.41 7.5500 116 01/01/08
371 Littleton CO 80127 2,547,125.71 18,960.54 7.5700 119 04/01/08
378 Galveston TX 77551 2,494,392.42 17,813.27 7.0900 118 03/01/08
379 Bethpage NY 11804 2,491,811.51 16,716.60 7.0500 80 01/01/05
383 Bowling Green KY 42101 2,472,995.16 16,566.09 7.0600 119 04/01/08
384 Memphis TN 38133 2,467,814.73 20,287.76 7.5000 230 07/01/17
388 San Diego CA 92121 2,448,027.16 16,448.26 7.0900 119 04/01/08
390 South Bend IN 46601 2,446,687.19 16,763.20 7.2800 118 03/01/08
393 Coral Gables FL 33146 2,396,615.50 16,144.95 7.1100 118 03/01/08
403 Lexington SC 29072 2,340,959.27 17,274.09 7.5700 232 09/01/17
406 Orlando FL 32835 2,322,167.35 16,560.29 7.6900 118 03/01/08
414 Wannamassa NJ 07712 2,254,135.36 15,294.74 7.1700 177 02/01/13
416 Austin TX 78705 2,246,834.81 15,151.07 7.1200 118 03/01/08
418 Santa Barbara CA 93101 2,222,028.77 15,299.34 7.3300 118 03/01/08
420 Houston TX 77081 2,205,232.78 16,045.30 7.3000 118 03/01/08
422 Vestiva Hills AL 35216 2,197,192.71 15,397.79 7.5100 118 03/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
277 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
279 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
282 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
284 298 N 0.1400 0.0050 N - Act/360 Lehman Brothers
285 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
287 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
289 237 N 0.1400 0.0050 N - Act/360 Lehman Brothers
293 239 N 0.1400 0.0050 N - Act/360 Lehman Brothers
295 290 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
296 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
298 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
298a N
298b N
302 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
303 N 0.0900 0.0050 N - 30/360 Lehman Brothers
306 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
310 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
312 357 N 0.1400 0.0050 N - Act/360 Lehman Brothers
314 353 N 0.0900 0.0050 N - Act/360 Lehman Brothers
316 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
319 297 Y 0.1400 0.0050 N - Act/360 Lehman Brothers
322 231 N 0.0900 0.0050 N - Act/360 Lehman Brothers
323 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
326 N 0.0950 0.0050 Y 2.0000 Act/360 Lehman Brothers
328 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
331 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
334 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
335 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
341 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
344 350 N 0.1650 0.0050 N - Act/360 Lehman Brothers
347 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
352 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
355 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
357 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
358 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
361 359 N 0.1100 0.0050 N - Act/360 Lehman Brothers
363 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
367 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
368 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
369 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
371 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
378 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
379 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
383 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
384 N 0.1500 0.0050 N - Act/360 Lehman Brothers
388 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
390 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
393 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
403 280 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
406 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
414 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
416 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
418 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
420 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
422 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
277 2.23 51.6 No Y N
279 1.24 79.8 No Y Y
282 Walgreen Company 1.29 69.0 No Y N
284 1.31 72.2 No N Y
285 1.39 73.7 No N Y
287 1.56 73.3 LB-C Y Y
289 1.36 67.6 No Y Y
293 1.28 69.7 No Y Y
295 Walgreen Company Y Y 1.02 94.2 No Y N
296 1.53 64.6 No Y Y
298 1.32 74.1 No Y Y
298a 1.32 77.8
298b 1.32 69.6
302 1.27 79.7 No Y Y
303 1.29 65.3 No N N
306 1.81 66.8 LB-B Y Y
310 1.29 79.9 No Y Y
312 1.30 72.5 No Y Y
314 1.28 75.8 No Y N
316 1.28 76.3 No Y Y
319 1.48 63.6 No Y Y
322 1.56 77.8 No Y N
323 1.39 73.8 No Y Y
326 1.29 79.2 No Y Y
328 1.29 79.8 No N Y
331 1.30 79.8 No Y Y
334 1.31 76.5 No Y Y
335 1.32 71.4 No N Y
341 1.41 79.9 No N Y
344 1.29 69.9 No N N
347 1.30 70.5 LB-C Y Y
352 1.38 57.0 No Y Y
355 1.29 78.5 No Y Y
357 1.39 74.7 No Y Y
358 1.27 74.9 No Y Y
361 1.38 77.5 No Y Y
363 1.54 69.8 No Y Y
367 1.30 79.6 No Y Y
368 1.32 78.6 No Y Y
369 3.53 39.8 No Y Y
371 1.31 74.7 No Y Y
378 1.31 65.6 No Y Y
379 1.25 62.3 No Y Y
383 1.33 79.8 No Y Y
384 1.19 83.1 LB-H Y Y
388 1.45 74.2 No N Y
390 1.57 74.1 No Y Y
393 1.26 68.5 No Y Y
403 JC Penney Y Y 1.07 97.5 No Y N
406 1.38 74.9 No Y N
414 1.20 77.7 No Y Y
416 1.43 73.7 No Y Y
418 1.32 74.1 No N Y
420 1.48 71.1 No Y Y
422 1.38 73.2 No Y Y
</TABLE>
B-17
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Lehman Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
423 5 Walk-Up Residential Buildings (Formerly 70 East) 70 East 3rd, 157,162 Stanton, 166,178 Norfolk
425 Days Inn (Winter Park) 901 North Orlando Avenue
427 Tara Woods Apartments 661 Sherwood Drive
428 Sneaker Stadium Hurfville Road (Route 41)
429 Andora Apartments 3305 Linda Drive
431 3610 Birch Street (Apollo Office Building) 3610 Birch Street
432 Walgreens Pharmacy (Miami) 15900 Northwest 27th Avenue
441 FAA Building 8808 Beck Road
448 Walgreens - Richmond 11119 Hull Street Road
449 Stoughton Plaza 397-423 Washington Street
450 PetsMart Inc. 2677 East Main Street
451 Cobblestone Village Shopping Center 2001-2099 East Orangethorpe Avenue
454 3848-3870 East Foothill Boulevard (East Pasadena) 3848-3870 East Foothill Boulevard
464 Rite Aid Pharmacy (Liberty) Route 52
466 CVS Pharmacy (Philadelphia) 1099 Washington Avenue
471 CVS Drug Store (Martinsville) S.R. 39 & Randolph Street
473 Auto/Retail Facility (Lauderhill) 6440 W. Commercial Boulevard
474 Campostella Corners Shopping Center South Military Highway/Campostella Road
475 Shops at State Bridge 5950 State Bridge Road
479 Fairfield Inn (Musselman-Mt.Sterling) 105 Stone Trace Drive
480 Hampton Inn (Musselman-Elizabethtown) 1035 Executive Drive
482 CVS Pharmacy (Vernon) 142 Talcottville Road
483 Shannon Square 3605-45 Library Road
494 Eckerd Drug Store (Jacksonville) NWC Southside Boulevard and Touchton Road
496 Gardner Plaza Pearson Boulevard
498 Officemax Free-Standing Retail/Commercial Building South Side of Route 611
500 The In-Line Retail Shop Space (Peoria) 8940 and 8960 West Bell Road
501 Western Hills Shopping Center Highway 105 West
502 Eckerd Drug Store (Ft. Myers) South Side of Palm Beach Boulevard (S.R. 80)
504 Crystal Inn (Brigham City) 480 Westland Drive
512 Revco Pharmacy (Decatur) SWC of Candler Road and Misty Candler Road
515 121 Greene Street 121 Green Street
516 Payson Center SEC of State Route 87 and State Route 260
518 Village Woods Commons Shopping Center 42 Nichols Street
519 Days Inn (Prescott Valley) 7875 East Highway 69
521 CVS Pharmacy (Lancaster) 32-54 W. Lemon Street
525 Galaxy Shopping Center 2300 Planet Avenue
526 Crestwood Station Shopping Center Kentucky Highway 146
527 Village Pines 25 South Lincoln Ave.
529 Price Savers Center 2049 West Broadway Road
530 Indian Village Shopping Center SEC of Indian School Road and 16th Street
531 Caledon Wood Professional Park Pelham Road
532 4445 West 16th Street 4445 W. 16th Avenue
533 6 Fortune Drive 6 Fortune Drive
536 Georgetown Village Apartments 1421 Reidville Road
537 336 Washington Street (Boston Private) 336 Washington Street
540 La Jolla Court Apartments 1322 North La Jolla Boulevard
542 Hodges Warehouse (Hodges II) 800 South Madison Avenue
544 Eckerd Drug Store (Camden) SWC of DeKalb Street and Campbell Street
545 CVS Drug Store (Mableton) 5846-5856 Mableton Parkway
548 Fry's Greenfield Plaza NEC Greenfield Road and University Drive
551 Ames Plaza (Amenia) Route 22
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
423 New York NY 10002 2,197,106.08 15,217.35 7.3900 118 03/01/08
425 Winter Park FL 32789 2,195,718.51 16,747.44 7.8400 118 03/01/08
427 Jonesboro GA 30236 2,194,360.59 15,241.76 6.7800 118 03/01/08
428 Deptford NJ 08096 2,193,031.27 14,963.14 7.2200 116 01/01/08
429 Dallas TX 75220 2,192,153.17 17,295.09 7.1800 238 03/01/18
431 Newport Beach CA 92660 2,183,388.13 15,322.75 7.5300 119 04/01/08
432 Miami FL 33054 2,170,234.76 16,922.34 7.4500 230 07/01/17
441 Van Buren Township MI 48111 2,141,611.88 23,552.00 7.0600 159 08/01/11
448 Richmond VA 23112 2,100,455.05 17,827.32 7.7700 223 12/01/16
449 Stoughton MA 02072 2,098,425.83 14,611.67 7.4500 119 04/01/08
450 Plainfield IN 46168 2,098,410.02 14,539.98 7.4000 119 04/01/08
451 Placentia CA 92670 2,098,381.24 14,411.26 7.3100 119 04/01/08
454 Pasadena CA 91107 2,096,994.77 14,041.94 7.0500 142 03/01/10
464 Liberty NY 12754 2,080,599.32 15,014.60 7.0200 236 01/01/18
466 Philadelphia PA 19147 2,074,140.20 14,743.00 6.9700 237 02/01/18
471 Martinsville IN 46151 2,038,393.46 16,350.34 7.3200 235 12/01/17
473 Lauderhill FL 33119 1,997,734.77 14,831.90 7.5400 119 04/01/08
474 Chesapeake VA 23320 1,997,261.83 13,616.41 7.2300 118 03/01/08
475 Alpharetta GA 30136 1,995,371.55 14,033.68 6.9200 118 03/01/08
479 Mt. Sterling KY 40353 1,991,043.78 15,004.30 7.6720 116 01/01/08
480 Elizabethtown KY 42701 1,991,043.78 15,004.30 7.6720 116 01/01/08
482 Vernon CT 06066 1,969,899.72 15,748.24 7.2500 234 11/01/17
483 Castle Shannon PA 15234 1,947,537.00 13,701.51 7.5500 118 03/01/08
494 Jacksonville FL 32216 1,905,798.57 13,875.41 7.2800 236 01/01/18
496 Gardner MA 01440 1,898,520.76 12,974.24 7.2600 119 04/01/08
498 Stroud Township PA 18360 1,897,760.17 13,782.33 7.2900 119 04/01/08
500 Peoria AZ 85345 1,893,035.93 14,260.71 8.2400 114 11/01/07
501 Montgomery TX 77356 1,892,853.54 13,891.55 7.6560 116 01/01/08
502 Ft. Myers Shores FL 33905 1,892,262.33 14,814.38 6.9200 232 09/01/17
504 Brigham City UT 84302 1,891,128.86 13,929.79 7.4100 176 12/31/12
512 Decatur GA 30032 1,840,419.99 14,490.34 7.1000 236 01/01/18
515 New York NY 10012 1,800,000.00 12,536.60 7.4600 120 05/01/08
516 Payson AZ 85541 1,797,620.30 12,426.02 7.3700 118 03/01/08
518 Ogden NY 14559 1,792,241.27 13,785.55 7.9100 116 01/01/08
519 Prescott AZ 86314 1,790,697.82 14,984.31 7.9360 237 02/01/18
521 Lancaster PA 17603 1,765,000.00 12,193.04 6.9000 249 02/01/19
525 Salina KS 67401 1,745,149.43 12,706.94 7.8900 116 01/01/08
526 Crestwood KY 40014 1,744,600.57 12,060.59 7.3530 116 01/01/08
527 Orchard Park NY 14127 1,742,848.98 12,796.06 7.3800 116 01/01/08
529 Mesa AZ 85202 1,722,787.60 12,049.64 7.4900 238 03/01/18
530 Phoenix AZ 85016 1,708,262.64 15,127.09 7.6400 200 01/01/15
531 Greenville SC 29615 1,705,674.66 11,746.57 7.3200 117 02/01/08
532 Hialeah FL 33012 1,698,200.81 12,171.66 7.7400 118 03/01/08
533 Billerica MA 01821 1,697,966.99 12,233.01 7.2000 119 04/01/08
536 Spartanburg SC 29306 1,697,602.64 11,436.01 7.1100 118 03/01/08
537 Wellesley MA 02181 1,697,590.85 11,413.09 7.0900 178 03/01/13
540 Goodyear AZ 85338 1,652,187.67 12,116.49 7.3600 80 01/01/05
542 Okmulgee OK 74447 1,645,107.98 15,493.27 7.7100 179 04/01/13
544 Camden SC 29020 1,631,475.16 12,252.21 7.4200 234 11/01/17
545 Mableton GA 30059 1,605,822.34 11,434.20 6.9700 236 01/01/18
548 Mesa AZ 85205 1,597,884.71 11,045.35 7.3700 118 03/01/08
551 Amenia NY 12501 1,595,195.82 11,176.48 7.4900 116 01/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
423 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
425 298 N 0.1400 0.0050 N - Act/360 Lehman Brothers
427 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
428 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
429 N 0.1400 0.0050 N - Act/360 Lehman Brothers
431 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
432 257 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
441 Y 0.0900 0.0050 N - 30/360 Lehman Brothers
448 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
449 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
450 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
451 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
454 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
464 286 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
466 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
471 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
473 299 N 0.1400 0.0050 N - Act/360 Lehman Brothers
474 358 N 0.1500 0.0050 N - Act/360 Lehman Brothers
475 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
479 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
480 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
482 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
483 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
494 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
496 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
498 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
500 354 N 0.1650 0.0050 N - Act/360 Lehman Brothers
501 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
502 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
504 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
512 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
515 360 N 0.0900 0.0050 N - Act/360 Lehman Brothers
516 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
518 N 0.0900 0.0050 Y 3.0000 Act/360 Lehman Brothers
519 N 0.0900 0.0050 N - 30/360 Lehman Brothers
521 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
525 N 0.1650 0.0050 Y 2.0000 Act/360 Lehman Brothers
526 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
527 296 N 0.1400 0.0050 N - Act/360 Lehman Brothers
529 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
530 Y 0.1650 0.0050 N - 30/360 Lehman Brothers
531 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
532 358 N 0.0900 0.0050 N - Act/360 Lehman Brothers
533 299 N 0.0900 0.0050 N - Act/360 Lehman Brothers
536 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
537 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
540 296 N 0.0900 0.0050 N - Act/360 Lehman Brothers
542 N 0.0900 0.0050 N - 30/360 Lehman Brothers
544 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
545 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
548 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
551 356 N 0.0900 0.0050 N - Act/360 Lehman Brothers
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
423 2.05 48.3 No Y Y
425 1.54 70.8 No Y N
427 1.58 72.0 No Y N
428 1.30 73.7 No Y Y
429 1.21 69.6 No Y Y
431 1.25 78.0 No Y Y
432 Walgreen Company Y N 1.01 94.4 No Y N
441 1.10 63.0 No Y N
448 Walgreen Company 1.03 85.7 No Y N
449 1.29 74.9 No N Y
450 1.27 79.2 No Y Y
451 1.54 58.3 No Y Y
454 1.29 78.3 No N Y
464 Rite Aid Corp. Y Y 1.03 97.9 No Y N
466 CVS Corporation 1.03 96.9 No Y N
471 Revco D.S. Inc. 1.03 93.9 No Y N
473 1.41 74.7 No Y Y
474 1.30 76.8 No Y Y
475 1.34 74.5 No Y Y
479 1.53 68.7 No Y N
480 1.70 55.3 No Y N
482 CVS Corporation 1.35 63.6 No Y N
483 1.34 74.9 No Y Y
494 1.21 77.8 No Y Y
496 1.54 65.5 No Y Y
498 1.33 73.0 No Y Y
500 1.42 64.5 No N N
501 1.28 67.6 No Y N
502 JC Penney 1.10 82.6 No Y N
504 1.49 59.1 No Y Y
512 Revco D.S. Inc. 0.95 80.5 No Y N
515 1.37 75.0 No Y Y
516 1.36 71.9 LB-E N Y
518 1.34 74.7 No Y N
519 1.45 74.6 No Y N
521 CVS Corporation 1.08 98.1 No Y N
525 1.40 72.7 No N N
526 1.85 38.8 LB-B Y Y
527 1.26 79.2 No Y Y
529 1.38 74.9 No N Y
530 1.45 74.3 No N N
531 1.34 74.8 No Y Y
532 1.42 60.7 No Y N
533 1.36 60.6 No Y Y
536 1.25 78.6 No Y Y
537 1.36 72.2 No N Y
540 1.33 74.6 No Y Y
542 1.29 65.8 LB-F Y N
544 JC Penney 1.05 98.9 No Y N
545 CVS Corporation 1.09 98.5 No Y N
548 1.65 63.9 LB-E N Y
551 1.38 63.8 No N Y
</TABLE>
B-18
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Lehman Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
553 Hilltop Village Shopping Center U.S. Highway 158
554 Friendly Square Shopping Center 11651 West 64th Avenue
558 8614 Burton Way Apts. 8614 Burton Way
559 Four Industrial Buildings (Great S.W. Industrial) Various
562 Port Jefferson Medical Park 5380 Nesconset Highway
563 Ashcroft Industrial Park 7313-7399 Ashcroft
564 8586-8588 Potter Park Drive (Palmer Ranch) 8586-8588 Potter Park Drive
566 Villa Fontana Apartments 7540 S.W. 59th Court
577 Garage Loft Apartments 113 N.W. 13th Street
578 Rite-Aid Pharmacy (Waynesburg) 8619 Waynesburg Drive
581 Rite Aid Pharmacey (Hogansville) 100 South Highway 29
582 Revco Pharmacy (Oak Ridge) 1287 Oak Ridge Turnpike
583 Imperial Plaza Office Building 1129 Watertower Lane
584 Overlook Court 4620-40 Richmond Road
589 66 West 84th Street 66 West 84th Street
594 Tara Ridge Apartments 6700 Tara Boulevard
596 Shoppes of Pembroke 12101 Taft Street
597 Normandy Retail Center 957, 969 & 1111 Normandy Drive
600 238-268 Post Road 238-268 Post Road
607 Rincon Plaza SWC of Golf Links Road and Harrison Road
608 Eckerd Store (Mt. Holly) 617 Highland Street
611 Eckerd Store (Florence) W. Palmetto Street/Cashua Drive
612 222 Post Road 222 Post Road
614 Kennestone Corners Business Center 1265 Kennestone Circle
616 Rite Aid Pharmacy (Williamsport) 14 West Fifth Street
617 CVS Pharmacy (Westbrook) 870 Main Street
619 Lexington Village Apartments 200-206 Lexington Drive and 902-911 Christy Court
631 Nob Hill Office Park 2520 Longview Street
632 North Post Oak Business Center 1500 North Poast Oak Road
634 Randall Court Apartments 6716-6728 Randall Court
635 Dillard Office Building 2424 Springer Drive
636 128th Street Warehouse 4590 N.W. 128th Street
637 Briarcliff Mews Apartments 803 Briarcliff Road
640 Wolfpack Village Apartments 643-733,735&738 Knox Street N. & 99&31 Gentle Ave.
644 The In-Line Shop Space (Chandler) 940 North Alma School Road
647 Dahnert Park Apartments One Dahnert Park Lane
651 NTB Store Site Vestal Parkway East
652 Pier 1 Imports 1524 Skyland Boulevard
655 Francesca Apartments 775 East 11th Avenue
666 Hodges Warehouse and Corporate Offices (Hodges I) 4401 South 72nd East Avenue
672 13348 Newport Boulevard (Walgreen - Tustin) 13348 Newport Boulevard
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
553 Oxford NC 27565 1,594,743.67 11,860.17 7.5200 116 01/01/08
554 Arvada CO 80004 1,588,764.57 10,868.18 7.2700 119 04/01/08
558 Los Angeles CA 90048 1,548,751.88 10,406.04 7.0900 119 04/01/08
559 Ft. Worth TX 75224 1,546,386.62 11,333.65 7.3800 118 03/01/08
562 Port Jefferson Station NY 11776 1,520,687.32 10,967.47 7.7900 116 01/01/08
563 Houston TX 77081 1,515,445.10 10,628.06 7.5000 116 01/01/08
564 Sarasota FL 34238 1,498,880.08 10,457.42 7.4700 119 04/01/08
566 South Miami FL 33143 1,496,067.38 10,090.60 7.1100 117 02/01/08
577 Oklahoma City OK 73103 1,435,402.50 9,755.07 7.1800 116 01/01/08
578 Sandy Township OH 44688 1,426,496.18 10,852.98 7.2300 211 12/01/15
581 Hogansville GA 30230 1,413,906.15 11,756.17 7.5400 225 02/01/17
582 Oak Ridge TN 19147 1,413,228.06 10,427.02 7.3400 207 08/01/15
583 West Carrollton OH 45449 1,398,946.34 9,721.99 7.4300 119 04/01/08
584 Warrensville Heights OH 44128 1,398,927.25 9,636.08 7.3400 119 04/01/08
589 New York NY 10024 1,376,574.41 9,583.10 7.4300 117 02/01/08
594 Jonesboro GA 30236 1,346,566.52 9,395.62 6.8300 118 03/01/08
596 Pembroke Pines FL 33026 1,326,253.83 9,583.49 7.8100 176 01/01/13
597 Miami Beach FL 33134 1,298,285.64 8,983.21 7.3800 118 03/01/08
600 Fairfield CT 06430 1,295,028.76 9,337.94 7.1800 177 02/01/13
607 Tucson AZ 85730 1,253,340.82 8,663.70 7.3700 118 03/01/08
608 Mt. Holly NC 28120 1,235,810.25 10,223.72 7.5800 229 06/01/17
611 Florence SC 29501 1,217,660.73 10,094.07 7.4700 224 01/01/17
612 Fairfield CT 06430 1,215,334.67 8,763.30 7.1800 177 02/01/13
614 Marietta GA 30066 1,197,430.82 8,743.38 7.3400 118 03/01/08
616 Williamsport PA 17701 1,192,416.56 9,573.00 7.0600 225 02/01/17
617 Westbrook ME 04092 1,162,826.18 9,433.54 7.4200 233 10/01/17
619 Clarksville TN 37040 1,149,068.46 7,697.37 7.0600 119 04/01/08
631 Austin TX 78705 1,048,643.01 7,313.02 7.4600 118 03/01/08
632 Houston TX 77055 1,047,141.55 6,908.28 6.8900 81 02/01/05
634 Gladstone MO 64118 1,012,794.54 6,924.02 7.2400 116 01/01/08
635 Norman OK 73609 997,934.48 7,409.44 7.5300 118 03/01/08
636 Opa Locka FL 33054 997,930.56 7,402.93 7.5200 118 03/01/08
637 Atlanta GA 30306 997,476.59 6,991.43 6.8800 118 03/01/08
640 Monmouth OR 97361 995,293.89 7,299.09 7.3600 296 01/01/23
644 Chandler AZ 85224 972,608.45 6,817.34 7.5000 117 02/01/08
647 Garfield NJ 07026 957,508.82 6,496.88 7.1700 177 02/01/13
651 Vestal NY 13805 918,191.46 6,490.53 7.2900 236 01/01/18
652 Tuscaloosa AL 35405 899,313.12 6,206.88 7.3600 119 04/01/08
655 Denver CO 80218 879,261.42 5,783.91 6.8800 83 04/01/05
666 Tulsa OK 74145 747,776.36 7,042.39 7.7100 179 04/01/13
672 Tustin CA 92680 494,859.06 4,645.27 7.0600 168 05/01/12
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
553 N 0.1500 0.0050 Y 2.0000 Act/360 Lehman Brothers
554 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
558 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
559 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
562 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
563 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
564 359 N 0.1400 0.0050 N - Act/360 Lehman Brothers
566 357 N 0.0900 0.0050 N - Act/360 Lehman Brothers
577 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
578 262 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
581 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
582 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
583 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
584 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
589 Y 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
594 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
596 N 0.1500 0.0050 Y 3.0000 Act/360 Lehman Brothers
597 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
600 297 N 0.1400 0.0050 N - Act/360 Lehman Brothers
607 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
608 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
611 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
612 297 N 0.1400 0.0050 N - Act/360 Lehman Brothers
614 298 N 0.1400 0.0050 N - Act/360 Lehman Brothers
616 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
617 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
619 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
631 358 N 0.1400 0.0050 N - Act/360 Lehman Brothers
632 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
634 356 N 0.1650 0.0050 N - 30/360 Lehman Brothers
635 298 N 0.0900 0.0050 N - Act/360 Lehman Brothers
636 298 N 0.0900 0.0050 N - Act/360 Lehman Brothers
637 298 N 0.0900 0.0050 N - 30/360 Lehman Brothers
640 N 0.0900 0.0050 N - 30/360 Lehman Brothers
644 N 0.1400 0.0050 Y 2.0000 Act/360 Lehman Brothers
647 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
651 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
652 N 0.0900 0.0050 Y 2.0000 Act/360 Lehman Brothers
655 359 N 0.0900 0.0050 N - Act/360 Lehman Brothers
666 N 0.0900 0.0050 N - 30/360 Lehman Brothers
672 N 0.0400 0.0050 N - 30/360 Lehman Brothers Y
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
553 1.34 66.5 No Y Y
554 1.36 69.1 No N Y
558 1.31 70.4 No Y Y
559 1.67 44.2 No Y N
562 1.26 62.1 No Y N
563 1.30 77.7 No Y Y
564 1.29 74.9 No Y Y
566 1.39 74.8 No Y Y
577 1.40 79.7 No Y Y
578 Rite Aid Corp. Y Y 1.03 97.4 No N N
581 Rite Aid Corp. 1.03 87.8 No Y N
582 Revco D.S. Inc. 1.05 88.3 No Y N
583 1.23 79.9 No Y Y
584 1.27 72.5 No Y Y
589 1.33 68.8 No Y Y
594 1.29 77.0 No Y N
596 1.32 74.7 No Y N
597 1.42 72.1 No Y Y
600 1.27 70.0 No Y Y
607 1.31 74.6 LB-E N Y
608 JC Penney 1.33 70.2 No Y N
611 JC Penney 1.05 87.0 No Y N
612 1.34 71.5 No Y Y
614 1.29 65.3 No Y Y
616 Rite Aid Corp. 1.46 64.5 No N N
617 CVS Corporation 1.03 89.5 No Y N
619 1.33 76.6 No Y Y
631 1.23 65.1 No Y Y
632 1.42 74.8 No Y Y
634 1.47 79.1 No N N
635 1.28 73.9 No Y Y
636 1.36 73.9 No Y Y
637 1.29 78.2 No Y N
640 1.68 57.7 No Y N
644 1.61 74.8 No N Y
647 1.24 79.8 No Y Y
651 Sears Roebuck & Co. 1.02 91.8 No Y N
652 1.36 74.9 No N Y
655 1.21 79.9 No Y Y
666 1.26 62.3 LB-F Y N
672 Walgreen Company 1.00 66.0 No Y N
</TABLE>
B-19
<PAGE>
SCHEDULE I
General Mortgage Representations and Warranties
(i) The information pertaining to each Mortgage Loan set forth in
the Mortgage Loan Schedule was true and correct in all material respects as of
the Cut-Off Date;
(ii) If such Mortgage Loan was originated by the Seller or an
affiliate thereof, then, as of the date of its origination, such Mortgage Loan
complied in all material respects with, or was exempt from, all requirements of
federal, state or local law relating to the origination of such Mortgage Loan;
and, if such Mortgage Loan was not originated by the Seller or an affiliate
thereof, then, to the best of the Seller's knowledge after having performed the
type of due diligence customarily performed by prudent institutional commercial
and multifamily mortgage lenders, as of the date of its origination, such
Mortgage Loan complied in all material respects with, or was exempt from, all
requirements of federal, state or local law relating to the origination of such
Mortgage Loan;
(iii) The Seller owns the Mortgage Loan, has good and marketable
title thereto, has full right and authority to sell, assign and transfer the
Mortgage Loan and is transferring the Mortgage Loan free and clear of any and
all liens, pledges, charges or security interests of any nature encumbering such
Mortgage Loan, and no provision of the Mortgage Note, Mortgage or other loan
document relating to such Mortgage Loan prohibits or restricts the Seller's
right to assign or transfer such Mortgage Loan;
(iv) The proceeds of such Mortgage Loan have been fully disbursed
and there is no requirement for future advances thereunder;
(v) Each of the related Mortgage Note, Mortgage(s), Assignment of
Leases, if any, and other agreements executed in connection therewith is the
legal, valid and binding obligation of the maker thereof (subject to any
non-recourse provisions therein and any state anti-deficiency legislation),
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally, and by general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law);
(vi) As of the date of its origination, there was no valid offset,
defense, counterclaim or right to rescission with respect to any of the related
Mortgage Note, Mortgage(s) or other agreements executed in connection therewith,
and, as of the
<PAGE>
Cut-off Date, to the best knowledge of the Seller, there is no valid offset,
defense, counterclaim or right to rescission with respect to such Mortgage Note,
Mortgage(s) or other agreements;
(vii) The assignment of the related Mortgage and Assignment of
Leases to the Trustee constitutes the legal, valid, binding and enforceable
assignment of such Mortgage in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally, and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law);
(viii) Except with respect to the Mortgage Loans listed in Exhibit
I-VIII hereto, each related Mortgage is a valid and enforceable first lien on
the related Mortgaged Property, which Mortgaged Property is free and clear of
all encumbrances and liens having priority over or on a parity with the first
lien of such Mortgage, except for (a) liens for real estate taxes and special
assessments not yet due and payable, (b) covenants, conditions and restrictions,
rights of way, easements and other matters of public record as of the date of
recording of such Mortgage, such exceptions appearing of record being
customarily acceptable to mortgage lending institutions generally or
specifically reflected in the appraisal of such Mortgaged Property made in
connection with the origination of such Mortgage Loan, and (c) other matters to
which like properties are commonly subject and which do not, individually or in
the aggregate, materially interfere with the benefits of the security intended
to be provided by such Mortgage or materially affect the value or marketability
of such Mortgaged Property, and such encumbrances do not materially interfere
with the current use or operation of the related Mortgaged Property and, except
with respect to the Mortgage Loans listed in Exhibit I-VIII hereto,] there
exists with respect to such Mortgaged Property an assignment of leases and rents
provision, whether as part of the related Mortgage or as a separate document or
instrument, which establishes and creates a first priority security interest in
and to leases and rents arising in respect of the related Mortgaged Property,
subject only to encumbrances described in subsections (a), (b) and (c) of this
subparagraph (viii);
(ix) The Seller has filed and/or recorded in all appropriate public
filing and recording offices all UCC-1 financing statements necessary to create
and perfect a security interest in and lien on the items of personal property
described therein (or, if not filed and/or recorded, has submitted such UCC-1
financing statements for filing and/or recording and such UCC-1 financing
statements are in form and substance acceptable for filing and/or recording), to
the extent perfection may be effected pursuant to applicable law by recording or
filing;
-2-
<PAGE>
(x) All taxes and governmental assessments that prior to the Cut-off
Date became due and owing in respect of, and affect, each related Mortgaged
Property have been paid, or an escrow of funds in an amount sufficient to cover
such payments has been established;
(xi) As of the date of its origination, there was no proceeding
pending for the total or partial condemnation of each related Mortgaged Property
that materially affects the value thereof, and such Mortgaged Property was free
of material damage; and, as of the Cut-off Date, the Seller has not received any
notice of the commencement of any proceeding for the total or partial
condemnation of any related Mortgaged Property that materially affects the value
thereof, and such Mortgaged Property is free of material damage;
(xii) Each related Mortgaged Property is covered by an ALTA (or its
equivalent) lender's title insurance policy insuring that each related Mortgage
is a valid first lien on such Mortgaged Property in the original principal
amount of the Mortgage Loan after all advances of principal, or there is a
binding commitment from a title insurer qualified and licensed in the applicable
jurisdiction, as required, to issue such policy; such title insurance policy, if
issued, is in full force and effect, is freely assignable and will inure solely
to the benefit of the Trustee as mortgagee of record, or any such commitment is
a legal, valid and binding obligation of such insurer; no claims have been made
under such title insurance policy, if issued; and to the best knowledge of the
Seller, no prior mortgagee has done, by act or omission, anything which would
materially impair the coverage of any such title insurance policy;
(xiii) As of the date of its origination, all insurance required
under each related Mortgage, which insurance covered such risks as were
customarily acceptable to prudent commercial and multifamily mortgage lending
institutions lending on the security of property comparable to the related
Mortgaged Property in the jurisdiction in which such Mortgaged Property is
located, and with respect to a fire and extended perils insurance policy, was in
an amount (subject to a customary deductible) at least equal to 100% of the full
insurable replacement cost of the improvements located on such Mortgaged
Property (except to the extent not permitted by applicable law and then in such
event in an amount in excess of the initial principal balance of the Mortgage
Loan, together with an "agreed value endorsement"), was in full force and effect
with respect to each related Mortgaged Property; and, as of the Cut-off Date, to
the best knowledge of the Seller, all insurance required under each Mortgage,
which insurance covers such risks and is in such amounts as are customarily
acceptable to prudent commercial and multifamily mortgage lending institutions
lending on the security of property comparable to the related Mortgaged Property
in the jurisdiction in which such Mortgaged Property is located, is in full
force and effect with respect to each related Mortgaged Property; and no
-3-
<PAGE>
notice of termination or cancellation with respect to any such insurance policy
has been received by the Seller; except for certain amounts not greater than
amounts which would be considered prudent by an institutional commercial
mortgage lender with respect to a similar mortgage loan and which are set forth
in the related Mortgage, any insurance proceeds in respect of a casualty loss or
taking, will be applied either to the repair or restoration of all or part of
the related Mortgaged Property or the reduction of the outstanding principal
balance of the Mortgage Loan;
(xiv) Other than payments due but not yet 30 days or more
delinquent, there is, to the best of the Seller's knowledge, (A) no material
default, breach, violation or event of acceleration existing under the related
Mortgage Note or each related Mortgage, and no event which, with the passage of
time or with notice and (B) the expiration of any grace or cure period, would
constitute a material default, breach, violation or event of acceleration under
any of such documents; the Seller has not waived any other material default,
breach, violation or event of acceleration under any of such documents; and
under the terms of each Mortgage Loan, each related Mortgage Note, each related
Mortgage and the other loan documents in the related Mortgage File, no person or
party other than the mortgagee may declare an event of default or accelerate the
related indebtedness under such Mortgage Loan, Mortgage Note or Mortgage;
(xv) As of the Cut-off Date, the Mortgage Loan is not, and in the
prior 12 months (or since the date of origination if such Mortgage Loan has been
originated within the past 12 months), has not been, 30 days or more past due in
respect of any Scheduled Payment;
(xvi) Except with respect to the Mortgage Loans listed in Exhibit
I-XVI hereto which accrue interest on the basis of the actual number of days
elapsed over a 360 day year, the Mortgage Loan accrues interest (payable monthly
in arrears) at a fixed rate of interest (except with respect to ARD Loans, with
respect to which the rate at which interest accrues thereon increases after the
Anticipated Repayment Date, except with respect to the Mortgage Loans listed in
Exhibit I-XVI hereto and except in connection with the occurrence of a default
and the accrual of default interest) on the basis of a 360-day year consisting
of twelve 30-day months;
(xvii) Each related Mortgage does not provide for or permit, without
the prior written consent of the holder of the Mortgage Note, each related
Mortgaged Property to secure any other promissory note or obligation, except as
expressly described in such Mortgage and other than another Mortgage Loan in the
Trust Fund;
(xviii) Such Mortgage Loan is or constitutes part of a "qualified
mortgage" within the meaning of Section
-4-
<PAGE>
860G(a)(3) of the Code. Accordingly, either as of the date of origination or the
Closing Date, the fair market value of the real property securing the Mortgage
Loan was not less than 80% of the "adjusted issue price" (within the meaning of
the REMIC Provisions) of such Mortgage Loan. For purposes of the preceding
sentence, the fair market value of the real property securing the Mortgage Loan
was first reduced by the amount of any lien on such real property that is senior
to the lien that secures such Mortgage Loan, and was further reduced by a
proportionate amount of any lien that is on a parity with the lien that secures
such Mortgage Loan;
(xix) Prepayment Premiums and Yield Maintenance Charges payable with
respect to the Mortgage Loan, if any, constitute "customary prepayment
penalties" within the meaning of Treasury Regulation Section 1.860G-1(b)(2);
(xx) One or more environmental site assessments were performed by an
environmental consulting firm independent of the Seller and the Seller's
affiliates with respect to each related Mortgaged Property during the 18-month
period preceding the Cut-off Date, and the Seller, having made no independent
inquiry other than to review the report(s) prepared in connection with the
assessment(s) referenced herein, has no knowledge of any material and adverse
environmental condition or circumstance affecting such Mortgaged Property that
was not disclosed in such report(s);
(xxi) The related Mortgage Note, Mortgage(s) and Assignment(s) of
Leases, if any, contain customary and enforceable provisions such as to render
the rights and remedies of the holder thereof adequate for the realization
against the related Mortgaged Property or Properties of the benefits of the
security, including realization by judicial or, if applicable, non-judicial
foreclosure, subject to applicable reorganization, insolvency, moratorium and
other similar laws affecting creditors' rights generally as from time to time,
in effect, and to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(xxii) To the best of the Seller's knowledge, after due inquiry, the
related Mortgagor is not a debtor in any bankruptcy, reorganization, insolvency
or comparable proceeding;
(xxiii) Such Mortgage Loan is secured by either a mortgage on a fee
simple interest or a leasehold estate in a commercial property or multifamily
property, including the related Mortgagor's interest in the improvements on the
related Mortgaged Property;
(xxiv) Unless such Mortgage Loan is an ARD Loan, such Mortgage Loan
does not provide for negative amortization;
-5-
<PAGE>
(xxv) Such Mortgage Loan is a whole loan, contains no equity
participation by the lender or shared appreciation feature and does not provide
for any contingent or additional interest in the form of participation in the
cash flow of the related Mortgaged Property;
(xxvi) The related Mortgage contains provisions for the acceleration
of the payment of the unpaid principal balance of such Mortgage Loan if, without
the prior written consent of the mortgagee, any related Mortgaged Property or
interest therein, is directly or indirectly encumbered in connection with
subordinate financing; provided, however, the Mortgage Loans listed in Exhibit
I-XXVI hereto, are encumbered by subordinated debt;
(xxvii) Except with respect to (W) transfers of certain
non-controlling interests in the Mortgagors as specified in the related
Mortgage, (X) the Mortgage Loans listed in Exhibit I-XXVII hereto, which permit
one or more transfers of the related Mortgaged Property to a person that
satisfies certain criteria (including criteria related to bankruptcy remoteness
and property management experience) specified in the related Mortgage, (Y) the
Mortgage Loans listed in Exhibit I-XXVII hereto, which permit a one-time
transfer of the Mortgaged Property, subject to payment of an assumption fee and
certain other conditions, and (Z) the Mortgage Loans listed in Exhibit I-XXVII
hereto, which permit two or more separate transfers of the related Mortgaged
Property, subject to payment of an assumption fee and certain other conditions,
the related Mortgage contains either (A) provisions for the acceleration of the
payment of the unpaid principal balance of such Mortgage Loan if any related
Mortgaged Property or interest therein is directly or indirectly transferred or
sold without the prior written consent of the mortgagee, or (B) provisions for
the acceleration of the payment of the unpaid principal balance of such Mortgage
Loan if any related Mortgaged Property or interest therein is directly or
indirectly transferred or sold without the related Mortgagor having satisfied
certain conditions specified in the related Mortgage with respect to permitted
transfers;
(xxviii) The Mortgage Loan, together with any other Mortgage Loan
made to the same Mortgagor or to an affiliate of such Mortgagor, does not
represent more than 5% of the aggregate Initial Pool Balance;
(xxix) Except as set forth in the related Mortgage File, the terms
of the related Mortgage Note and Mortgage(s) have not been waived, modified,
altered, satisfied, impaired, canceled, subordinated or rescinded in any manner
which materially interferes with the security intended to be provided by such
Mortgage;
-6-
<PAGE>
(xxx) Each related Mortgaged Property was inspected by or on behalf
of the related originator during the 12 month period prior to the related
origination date;
(xxxi) Except for the Mortgage Loans listed in Exhibit I-XXXI
hereto, the terms of the related Mortgage Note or Mortgage do not provide for
the release of any material portion of the related Mortgaged Property from the
lien of such Mortgage without payment in full of the Mortgage Loan;
(xxxii) The related Mortgagor has covenanted in the Mortgage Loan
documents to maintain the related Mortgaged Property in compliance with all
applicable laws, zoning ordinances, rules, covenants and restrictions affecting
the construction, occupancy, use and operation of such Mortgaged Property, and
the related originator performed the type of due diligence in connection with
the origination of such Mortgage Loan customarily performed by prudent
institutional commercial and multifamily mortgage lenders with respect to the
foregoing matters; the Seller has received no notice of any material violation
of any applicable laws, zoning ordinances, rules, covenants or restrictions
affecting the construction, occupancy, use or operation of such Mortgaged
Property; to the Seller's knowledge (based on surveys and/or title insurance
obtained in connection with the origination of such Mortgage Loan), as of the
date of such origination, no improvement that was included for the purpose of
determining the appraised value of the related Mortgaged Property at the time of
origination of such Mortgage Loan lay outside the boundaries and building
restriction lines of such property to an extent which would have a material
adverse affect on the related Mortgagor's use and operation of such Mortgaged
Property (unless affirmatively covered by the title insurance referred to in
paragraph (xii) above), and no improvements on adjoining properties encroached
upon such Mortgaged Property to any material extent;
(xxxiii) Except with respect to Credit Lease Loans, the related
Mortgagor has covenanted in the Mortgage Loan documents to deliver each year to
the mortgagee an operating statement of each related Mortgaged Property covering
the twelve-month period identified therein;
(xxxiv) With respect to at least 95% of the Mortgage Loans (by
balance) having a Cut-off Date Balance in excess of 1% of the Initial Pool
Balance, the related Mortgagor has covenanted in its organizational documents
and/or the Mortgage Loan documents to own no significant asset other than the
related Mortgaged Property or Mortgaged Properties, as applicable, and assets
incidental to its ownership and operation of such Mortgaged Property;
(xxxv) No advance of funds has been made, directly or indirectly, by
the Seller to the Mortgagor other than pursuant to the Mortgage Note and no
funds have been received
-7-
<PAGE>
from any person other than such Mortgagor for or on account of payments due on
the Mortgage Note;
(xxxvi) To the Seller's actual knowledge, there are no pending
actions, suits or proceedings by or before any court or governmental authority
against or affecting the related Mortgagor or the related Mortgaged Property
that, if determined adversely to such Mortgagor or Mortgaged Property, would
materially and adversely affect the value of the Mortgaged Property or the
ability of the Mortgagor to pay principal, interest or any other amounts due
under such Mortgage Loan;
(xxxvii) Such Mortgage Loan complied with all applicable usury laws
in effect at its date of origination;
(xxxviii) To the extent required under applicable law as of the
Closing Date, the originator of such Mortgage Loan was authorized to do business
in the jurisdiction in which the related Mortgaged Property is located at all
times when it held the Mortgage Loan to the extent necessary to ensure the
enforceability of such Mortgage Loan;
(xxxix) If the related Mortgage is a deed of trust, a trustee, duly
qualified under applicable law to serve as such, is properly designated and
serving under such Mortgage;
(xl) The related Mortgage Note is not secured by any collateral that
secures a mortgage loan that is not in the Trust Fund (except with respect to
the Mortgage Loans listed in Exhibit I-XL hereto), and each Mortgage Loan that
is cross-collateralized is cross-collateralized only with other Mortgage Loans
sold pursuant to this Agreement;
(xli) The related Mortgaged Property either is not located in a
flood hazard area as defined by the Federal Insurance Administration or is
covered by flood hazard insurance;
(xlii) Except with respect to the Mortgage Loans listed on Exhibit
I-XLII hereto, one or more engineering assessments were performed by an
engineering consulting firm independent of the Seller and the Seller's
affiliates with respect to each related Mortgaged Property during the 18-month
period preceding the Cut-off Date, and the Seller, having made no independent
inquiry other than to review the report(s) prepared in connection with the
assessment(s) referenced herein, has no knowledge of any material and adverse
engineering condition or circumstance affecting such Mortgaged Property that was
not disclosed in such report(s);
(xliii) All escrow deposits and payments relating to the Mortgage
Loan are under control of the Seller or the servicer of such Mortgage Loan and
all amounts required as of the date hereof under the Mortgage Loan Documents to
be deposited by the related Mortgagor have been deposited;
-8-
<PAGE>
(xliv) The related Mortgagor has represented to the Seller that as
of the date of origination of the Mortgage Loan, such Mortgagor, the related
lessee, franchisor or operator was in possession of all licenses, permits and
authorizations then required for use of the related Mortgaged Property, which
were valid and in full force and effect; and
(xlv) The origination, servicing and collection practices used by
the Seller or any prior holder of the Mortgage Note have been in all respects
legal and have met customary industry standards.
(xlvi) Except as set forth in Schedule II, the Mortgage Loan is
secured in whole or in part by a fee simple interest.
-9-
<PAGE>
SCHEDULE II
Ground Lease Representations and Warranties
(i) With respect to any Mortgage Loan that is secured in whole or in
material part by the interest of a Mortgagor as a lessee under a Ground Lease
but not by the related fee interest:
(A) Such Ground Lease or a memorandum thereof has been or will be duly
recorded (other than the Ground Lease related to the Mortgage Loan listed
in Exhibit II-A hereto) and such Ground Lease permits the interest of the
lessee thereunder to be encumbered by the related Mortgage or, if consent
of the lessor thereunder is required, it has been obtained prior to the
Closing Date;
(B) Upon the foreclosure of the Mortgage Loan (or acceptance of a deed in
lieu thereof), the Mortgagor's interest in such Ground Lease is assignable
to the Trustee without the consent of the lessor thereunder (or, if any
such consent is required, it has been obtained prior to the Closing Date)
and, in the event that it is so assigned, is further assignable by the
Trustee and its successors without a need to obtain the consent of such
lessor; provided, that the lessor's consent to a subsequent sale is
required under the Ground Lease related to the Mortgage Loans listed in
Exhibit II-B hereto;
(C) Such Ground Lease may not be amended, modified, canceled or terminated
without the prior written consent of the Mortgagee thereunder and that any
such action without such consent is not binding on such Mortgagee, its
successors or assigns;
(D) Unless otherwise set forth in the Ground Lease, the Ground Lease does
not permit any increase in the amount of rent payable by the ground lessee
thereunder during the term of the Mortgage Loan;
(E) Such Ground Lease was in full force and effect as of the date of
origination of the related Mortgage Loan, and to the actual knowledge of
the Seller, at the Closing Date, such Ground Lease is in full force and
effect and other than payments due but not yet 30 days or more delinquent,
(1) there is no material default, and (2) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a material default under such Ground Lease;
(F) Such Ground Lease or an estoppel or consent letter received by the
Mortgagee from the lessor, requires the lessor thereunder to give notice
of any default by the lessee to the Mortgagee; and such Ground Lease, or
an
-10-
<PAGE>
estoppel or consent letter received by the Mortgagee from the lessor,
further provides either (1) that no notice of termination given under such
Ground Lease is effective against the Mortgagee unless a copy has been
delivered to the Mortgagee in the manner described in such Ground Lease,
estoppel or consent letter or (2) that upon any termination of the Ground
Lease the lessor will enter into a new lease with the mortgagee;
(G) The ground lessee's interest in the Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority with, the related
Mortgage, other than the related ground lessor's related fee interest and
any exceptions stated in the related title insurance policy or opinion of
title, which exceptions do not and will not materially and adversely
interfere with (1) the ability of the related Mortgagor timely to pay in
full the principal and interest on the related Mortgage Note, (2) the use
of such Mortgaged Property for the use currently being made thereof, or
(3) the value of the Mortgaged Property;
(H) A Mortgagee is permitted a reasonable opportunity to cure any curable
default under such Ground Lease before the lessor thereunder may terminate
such Ground Lease;
(I) Such Ground Lease has an original term (together with any extension
options, whether or not currently exercised, set forth therein) that
extends not less than 10 years beyond the Stated Maturity Date of the
related Mortgage Loan;
(J) Except with respect to the Ground Lease related to each of the
Mortgage Loans listed in Exhibit II-J hereto, under the terms of such
Ground Lease, any estoppel or consent letter received by the Mortgagee
from the lessor, and the related Mortgage, taken together, any related
insurance proceeds or condemnation proceeds will be applied either to the
repair or restoration of all or part of the related Mortgaged Property,
with the Mortgagee or a trustee appointed by it having the right to hold
and disburse such proceeds as the repair or restoration progresses, or to
the payment of the outstanding principal balance of the Mortgage Loan
together with any accrued interest thereon;
(K) Such Ground Lease does not impose any restrictions on subletting which
would be viewed as commercially unreasonable by a prudent commercial
mortgage lender;
(L) Except with respect to Mortgage Loans listed on Exhibit II-L hereto,
the ground lessor under such Ground Lease is required to enter into a new
lease upon termination of the Ground Lease for any reason, including the
rejection of the Ground Lease in bankruptcy, and for any reason, upon the
request of the lender; and
-11-
<PAGE>
(M) The terms of the related Ground Lease have not been waived, modified,
altered, satisfied, impaired, canceled, subordinated or rescinded in any
manner which materially interferes with the security intended to be
provided by such Mortgage.
(ii) With respect to Mortgage Loans secured in whole or
in part by the interest of the related mortgagor under a Ground Lease and by the
related fee interest, such fee interest is subject, and subordinated of record,
to the related Mortgage, and such Mortgage does not by its terms provide that it
will be subordinated to the lien of any other mortgage or other lien upon such
fee interest.
-12-
<PAGE>
SCHEDULE III
Health Care Facility Representations and Warranties
With respect to any Mortgage Loan that is secured in whole or in
part by a Mortgage Property which is operated as a residential health care
facility (a "Facility");
(A) All governmental licenses, permits, regulatory agreements or other
approvals or agreements necessary for the use and operation of each
Facility as intended are held by the related Mortgagor or the operator of
the Facility, and are in full force and effect, including, without
limitation, a valid certificate of need ("CON") or similar certificate,
license, or approval issued by the applicable department of health for the
requisite number of beds, and approved provider status in any approved
provider payment program (collectively, the "Licenses").
(B) The Licenses (1) may not be, and have not been, transferred to any
location other than the Facility; (2) have not been pledged as collateral
security for any other loan or indebtedness; and (3) are held free from
restrictions or known conflicts which would materially impair the use or
operation of the Facility as intended, and are not provisional,
probationary or restricted in any way.
(C) As of the Cut-off Date and to Seller's knowledge, without inquiry, (1)
as of the Cut-off Date, the Facility has not received a "Level A" (or
equivalent) violation which has not been cured to the satisfaction of the
applicable governmental agency, and (2) no statement of charges or
deficiencies has been made or penalty enforcement action has been
undertaken against the Facility, its operator or the Mortgagor or against
any officer, director or stockholder of such operator or the Mortgagor by
any governmental agency during the last three calendar years, and there
have been no violations over the past three years which have threatened
the Facility's, the operator's or the Mortgagor's certification for
participation in Medicare or Medicaid or the other third-party payors'
programs.
-13-
<PAGE>
SCHEDULE IV
Credit Lease Loan Representations and Warranties
With respect to any Mortgage Loan that is a Credit Lease Loan;
(A) Except with respect to the Mortgage Loans listed in Exhibit IV-A
hereto, the lease payments due under the related Credit Lease, together
with any escrow payments held by the Seller or its designee, are equal to
or greater than the payments due with respect to the related Mortgage
Loan;
(B) Except with respect to Credit Lease Loans as indicated in Exhibit IV-B
hereto, the Mortgagor does not have monetary obligations under the related
Credit Lease, and every monetary obligation associated with managing,
owning, developing and operating the leased property, including, but not
limited to, the costs associated with utilities, taxes, insurance,
maintenance and repairs is an obligation of the related Tenant;
(C) Except with respect to Credit Lease Loans listed in Exhibit IV-C
hereto, the Mortgagor does not have any nonmonetary obligations under the
related Credit Lease, except for the delivery of possession of the leased
property;
(D) Except with respect to the Credit Lease Loans listed in Exhibit IV-D
hereto, the Mortgagor has not made any representation or warranty in the
related Credit Lease, a breach of which would result in the termination
of, or an offset or abatement with respect to, such Credit Lease;
(E) Except with respect to the Credit Lease Loans listed in Exhibit IV-E
hereto, the related Tenant cannot terminate such Credit Lease for any
reason prior to the payment in full of: (a) the principal balance of the
related Mortgage Loan; (b) all accrued and unpaid interest on such
Mortgage Loan; and (c) any other sums due and payable under such Mortgage
Loan, as of the termination date, which date is a rent payment date,
except for a default by the related Mortgagor under the Credit Lease or
due to a casualty or condemnation event, in which case, a Lease
Enhancement Policy insures against such risk;
(F) In the event the related Tenant assigns or sublets the related leased
property, such Tenant (and if applicable, the related guarantor) remains
obligated under the related Credit Lease;
(G) Except with respect to the Credit Lease Loans listed in Exhibit IV-G
hereto, each property related to a Credit Lease Loan is a separate tax
lot;
-14-
<PAGE>
(H) Except with respect to the Credit Lease Loans listed in Exhibit IV-H
hereto, the related Tenant has agreed to indemnify the Mortgagor from any
claims of any nature other than the acts or omissions of the related
Mortgagor, (a) to which the Mortgagor is subject because of such
Mortgagor's estate in the leased property, or (b) arising from (i) injury
to or death of any person or damage to or loss of property on the leased
property or connected with the use, condition or occupancy of the leased
property, (ii) Tenant's violation of the related Credit Lease, or (iii)
any act or omission of the Tenant;
(I) Except with respect to the Mortgage Loans listed in Exhibit IV-I
hereto, related Tenant has agreed to indemnify the Mortgagor from any
claims of any nature arising as a result of any hazardous material
affecting the leased property and due to such Tenant's use of the leased
property;
(J) Except with respect to the Mortgage Loans listed in Exhibit IV-J
hereto, in connection with Credit Lease Loans with respect to which a
Guaranty exists, the related guarantor guarantees the payment due under
the related Credit Lease and such Guaranty, on its face, contains no
conditions to such payment;
(K) With respect to Credit Lease Loans that have the benefit of residual
value insurance policies and lease enhancement policies, each such policy
has been obtained, and with respect to the Credit Leases other than
bond-type leases, the required premiums have been paid; and
(L) The list of lease guarantors, if any, attached as Exhibit IV-L hereto,
is accurate in all material respects.
-15-
<PAGE>
Schedule V
Gentlemen:
I have acted as counsel to [SELLER]. First Union Commercial Mortgage
Securities, Inc. will acquire certain mortgage loans from [seller] pursuant to
the Mortgage Loan Purchase Agreement, dated as of [ ] (the "Mortgage Loan
Purchase Agreement"). Capitalized terms used but not defined herein shall have
the meanings set forth in the Mortgage Loan Purchase Agreement.
You have asked for my opinion regarding the due authorization of
[Seller] to enter into the Mortgage Loan Purchase Agreement.
As to matters of fact material to this opinion, I have relied,
without independent investigation on (i) the representations and warranties of
[SELLER] in the Mortgage Loan Purchase Agreement, (ii) relevant resolutions of
the Board of Directors of [SELLER], (iii) certificates of responsible officers
of [SELLER] and (iv) certificates of public officials.
In this connection, I have examined or have caused to be examined on
my behalf, a copy of the Mortgage Loan Purchase Agreement and such other
documents and instruments which I have deemed necessary or appropriate in
connection with this opinion.
I have relied on originals or copies, certified or otherwise
identified to my satisfaction, of the certificate of incorporation and by-laws
of [SELLER], records of proceedings taken by [SELLER], and such other corporate
documents and records of [SELLER], and have made such other investigations as I
have deemed relevant or necessary for the purpose of this opinion. I have
assumed, without independent investigation, the genuineness of all signatures
(other than those of officers of [SELLER]), the authenticity of all documents
submitted to me as originals and the conformity to original documents of all
documents submitted to me as certified, conformed or reproduction copies.
On the basis of and subject to the foregoing, it is my opinion that:
(1) [SELLER] is a [corporation] duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, with the corporate
power and authority to transact the business contemplated by the Mortgage Loan
Purchase Agreement, and it has the requisite corporate power and authority to.
execute and deliver the Mortgage Loan Purchase Agreement and to perform and
observe the terms and conditions thereof.
-16-
<PAGE>
(2) The Mortgage Loan Purchase Agreement has been duly authorized,
executed and delivered by [SELLER].
(3) The execution, delivery and performance by [SELLER] of the
Mortgage Loan Purchase Agreement will not conflict with, result in a breach of,
or constitute a default under any material term of [SELLER]'s certificate of
incorporation or bylaws, any term or provision of any material contract,
agreement or other instrument known to me to which [SELLER] is a party or by
which it is bound, or, to the best of my knowledge without independent
investigation, any order, judgment, writ, injunction or decree known to me of
any court or governmental authority having jurisdiction over [SELLER].
(4) The Mortgage Loan Purchase Agreement constitutes, assuming due
authorization, execution and delivery by the other party thereto, the valid and
binding obligation of [SELLER] enforceable against [SELLER] in accordance with
its terms, except as such enforcement may be limited by (a) bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally, (b) general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law) and
(c) limitations of public policy under applicable securities laws as to rights
of indemnity thereunder.
In furnishing the foregoing opinions, I express no opinion other
than as to the general corporation law of the State of Delaware, the law of the
State of New York and the federal law of the United States of America.
This opinion is being delivered to you for your sole use in
connection with the above-referenced transactions and may not be used or relied
upon by any other person, firm or entity in any other context for any other
purpose. This opinion may not be quoted in whole or in part, nor may copies be
furnished or delivered to any other person without the consent of [SELLER]
except that you may furnish copies to (i) your independent auditors and
attorneys, (ii) any United States, state or local authority having jurisdiction
over you, (iii) pursuant to the order of any legal process of any court of
competent jurisdiction or governmental agency, and (iv) in connection with any
legal action arising in connection with the above-referenced transactions.
Very truly yours,
-17-
<PAGE>
EXHIBIT B
Exception to Section 2(c)
None
<PAGE>
EXHIBIT I-VIII
Exception to Schedule I Clause (viii)
None
<PAGE>
EXHIBIT I-XVI
================================================================================
LEHMAN BROTHERS Page 1 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
Exception Rep XVI (actual/360)
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
2 Broadmoor Austin 154,000,000.00
3 Fox Valley Mall 85,527,649.00
4 Hawthorn Center 77,863,877.00
9 Musselman Portfolio (Roll-Up) 23,892,525.17
10 Ohio Edison Office Building 22,468,036.24
12 Holiday Inn Downtown 21,840,552.21
14 St. Andrews Place 20,942,733.05
17 Hickory Ridge Commons Shopping Center 17,952,727.94
19 1066 Third Avenue (Royale Retail Condomi 17,344,007.86
20 Richardson Highlands 16,847,577.42
22 Stallings Portfolio (Loan Level) 16,277,350.35
26 Levittown Trace Apartments 14,522,217.09
27 Chester Mall 14,488,711.07
29 Statesboro Mall 14,288,507.76
30 Days Inn & Suites Historic Savannah 13,770,454.32
32 Sandy Mall 13,738,706.98
35 Temple City Square 13,269,824.24
42 GTE Stemmons Crossing 12,400,000.00
43 Highland Pinetree Apartments 12,389,735.13
44 Westmont Business Park (Roll-up) 12,218,749.98
45 Wyndham Garden Hotel 12,204,210.32
46 Hulen Bend Center 12,168,124.07
49 Golf Glen Mart Plaza 11,863,983.65
50 Clearwater Crossing Shopping Center 11,569,846.73
51 Rivercrest Village Apartments 11,564,174.06
54 Market at Wolfcreek 10,947,916.37
59 Concorde Centre II Office Building 10,500,000.00
63 Maplewood Center 9,745,742.13
66 Inverrary 441 Apartments 9,586,461.99
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 2 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
70 Hampton Inn Pensacola Beach 9,250,000.00
73 North Willow Commons Shopping Center 9,205,383.81
74 International Club Apartments 9,186,994.22
75 Village Green Apartments 9,177,123.74
80 Briarcliffe Lakeside Apartments 8,776,084.48
81 Daytona Beach Hilton Oceanfront Resort 8,281,860.32
83 North Oaks Plaza 8,093,897.78
87 1616 Walnut Street 7,794,129.65
89 Hampton Inn (Louisville) 7,771,500.87
92 White Marlin Mall, Phase I 7,743,942.22
97 Classic Portfolio (Roll-up) 7,201,769.35
98 Oak Hills Medical Plaza 7,181,443.42
100 Kensington Club Apartments 7,131,286.58
102 West Georgia Commons 7,094,294.06
103 Colleyville Court 7,081,449.20
104 Tlaquepaque Arts & Crafts Village 7,055,984.78
106 Glen Harbor Plaza 6,990,558.40
107 Hulen Fashion Center 6,968,150.86
110 City Place 6,892,159.81
111 Sunscape West Apartments 6,839,980.49
114 Le Med Apartments 6,744,467.08
116 Westminster Plaza 6,690,963.03
119 City Center Building 6,656,983.36
120 Dublin Mall 6,594,695.89
123 Highgate Apartments 6,583,249.29
124 Playa Blanca Apartments 6,582,428.06
131 Pelham at Hyland Business Center 6,402,356.16
136 Officemax and Best Buy 6,320,000.00
137 Two Executive Boulevard 6,295,095.15
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 3 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
143 Linden Court Apartments 6,190,931.25
144 Serra Commons Apartments 6,177,199.24
148 Holiday Inn City Center 6,073,664.24
149 53, 53-West, and 102 Commerce Center 5,993,027.80
151 Emerald Apartments 5,984,430.12
152 MacArthur Plaza I & II 5,983,970.74
154 Evergreen Plaza 5,982,208.81
155 21 DuPont Circle 5,795,439.34
156 1-3 Parklands Drive (Parkland Office Par 5,792,389.77
157 Payne Ranch Centre 5,785,128.07
161 Wickes Shopping Center 5,707,136.81
162 Ashby Square West Shopping Center 5,685,607.37
164 Commerce Park of Palm Beach County 5,585,217.47
172 73 Spring Street Limited Partnership 5,382,520.27
174 Club at Woodland Pond 5,355,892.91
178 Whole Foods Market 5,331,911.30
179 One Sentry Parkway 5,292,378.31
187 Budgetel Inn 4,994,436.22
188 Hillside Village Center 4,993,729.36
191 Thrifty's (Roll-Up) 4,936,933.47
193 Tiffany Corner Shopping Center 4,904,313.30
194 Timbers of Pine Hollow Apartments 4,896,093.16
200 Southpoint Shopping Center 4,735,219.11
201 Provincial Towers Apartments 4,662,868.47
202 Royal Palms Mobile Home/RV Park 4,600,000.00
204 Park Plaza - Salem 4,588,483.58
208 Village Faire Shoppes 4,489,166.80
209 South Trust Building 4,488,810.52
210 South Ridge Apartments 4,485,830.01
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 4 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
214 Minges Creek Plaza 4,445,732.34
215 TransFlorida Bank Plaza 4,393,961.09
216 Chesapeake Square 4,393,749.31
220 J.P. Morgan Building 4,196,597.85
224 Kingston Apartments 4,180,514.34
225 Glengary Shopping Center 4,174,404.10
226 1696 and 1700 to 1712 Newport Boulevard 4,164,473.16
231 Karl Plaza Shopping Center 4,114,484.43
232 Villa Serrano 4,111,868.60
233 Kendale Plaza Shopping Center 4,094,344.90
235 Best Buy (Little Rock) 4,092,586.34
241 Oakwood Apartments 3,990,036.80
245 Fashion Village and East Colonial Shoppi 3,932,520.25
252 Merrill Crossing Shopping Ctr. 3,790,289.55
257 Versailles of Rockford 3,750,108.50
258 Lynnwood Manor Health Care Center 3,746,037.63
259 Tri-County Square 3,688,584.07
260 Bethesda Court Hotel 3,636,395.34
262 Roswell Mill Office Buildings 3,614,244.75
263 Highland Tech Center 3,597,169.25
264 Stor-All Properties 3,594,923.24
265 Parole Office Park 3,594,810.39
268 Courtyards Apartments 3,591,078.89
269 Miami Gardens Plaza 3,591,048.41
271 Webtron Building 3,547,375.75
273 Santa Fe Square 3,496,073.89
276 Best Buy (Sioux Falls) 3,475,000.00
277 Parkway Nursing Home 3,446,354.62
279 Terrace View Apartments 3,431,073.27
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 5 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
284 Fidelity Federal Bank Building 3,392,923.73
285 White Mountain Village 3,390,568.02
287 Shepherdsville Square 3,389,509.68
289 100 Broadway 3,380,435.75
293 Green Center (MCG) 3,343,708.47
296 Everett I-5 Mini-Storage 3,295,515.58
298 Marketplace Shopping Center (Williamsbur 3,291,905.50
302 Sussex Downs Apartments 3,266,130.06
306 Manchester Square 3,239,972.50
310 Swall Towers East 3,197,448.60
312 Hillside Village Plaza 3,191,710.26
314 Kaiser Permanente Health Center 3,184,959.64
316 Swall Towers West 3,147,488.47
319 Salt Lake Medical Plaza Office Building 3,134,338.76
322 Carriage Hills Apartments 3,113,343.36
323 Village on the Pike Shopping Center 3,097,528.33
326 General Cinema 3,090,238.46
328 Valencia Gardens Apartments 3,071,470.37
331 Woodmere Apartments 3,032,111.26
334 Rain Forest Apartments 2,997,655.06
335 Nexstar Pharmaceuticals Building 2,997,612.80
341 Timberfalls Apartments 2,955,617.80
344 University Village Shopping Center 2,936,468.90
347 Greenbrier Valley Mall 2,891,052.37
352 Maple Plaza Shopping Center 2,792,929.95
355 West Court Office Building 2,745,987.29
357 Paradise Shopping Plaza 2,697,988.17
358 Century Analysis, Inc., Building 2,696,563.47
361 Dolly Creek Shopping Center 2,672,871.41
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 6 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
363 Raintree Apartments 2,652,844.86
367 Park East Apartments 2,596,160.04
368 Shadow Trail Apartments 2,593,160.14
369 Inn at Saratoga 2,588,127.92
371 Marketplace at Ken Caryl 2,547,125.71
378 K-Mart Plaza Shopping Center (Galveston) 2,494,392.42
379 303 Winding Road 2,491,811.51
383 Hillside Apartments 2,472,995.16
384 Walgreen Store (Wolfcreek) 2,467,814.73
388 Miramar/Chapparone Auto Center 2,448,027.16
390 Jefferson Centre 2,446,687.19
393 Central Park Professional Center 2,396,615.50
406 1803 Park Center Drive 2,322,167.35
414 Wanamassa Gardens Apartments 2,254,135.36
416 River Oaks Apartments 2,246,834.81
418 Timm Office Building 2,222,028.77
420 Hillcroft Plaza Shopping Center 2,205,232.78
422 Olde Towne Shopping Center 2,197,192.71
423 5 Walk-Up Residential Buildings (Formerl 2,197,106.08
425 Days Inn (Winter Park) 2,195,718.51
428 Sneaker Stadium 2,193,031.27
429 Andora Apartments 2,192,153.17
431 3610 Birch Street (Apollo Office Buildin 2,183,388.13
449 Stoughton Plaza 2,098,425.83
450 PetsMart Inc. 2,098,410.02
451 Cobblestone Village Shopping Center 2,098,381.24
454 3848-3870 East Foothill Boulevard (East 2,096,994.77
473 Auto/Retail Facility (Lauderhill) 1,997,734.77
474 Campostella Corners Shopping Center 1,997,261.83
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 7 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
475 Shops at State Bridge 1,995,371.55
479 Fairfield Inn (Musselman-Mt.Sterling) 1,991,043.78
480 Hampton Inn (Musselman-Elizabethtown) 1,991,043.78
483 Shannon Square 1,947,537.00
494 Eckerd Drug Store (Jacksonville) 1,905,798.57
496 Gardner Plaza 1,898,520.76
498 Officemax Free-Standing Retail/Commercia 1,897,760.17
500 The In-Line Retail Shop Space (Peoria) 1,893,035.93
501 Western Hills Shopping Center 1,892,853.54
504 Crystal Inn (Brigham City) 1,891,128.86
515 121 Greene Street 1,800,000.00
516 Payson Center 1,797,620.30
518 Village Woods Commons Shopping Center 1,792,241.27
525 Galaxy Shopping Center 1,745,149.43
526 Crestwood Station Shopping Center 1,744,600.57
527 Village Pines 1,742,848.98
529 Price Savers Center 1,722,787.60
531 Caledon Wood Professional Park 1,705,674.66
532 4445 West 16th Street 1,698,200.81
533 6 Fortune Drive 1,697,966.99
536 Georgetown Village Apartments 1,697,602.64
537 336 Washington Street (Boston Private) 1,697,590.85
540 La Jolla Court Apartments 1,652,187.67
548 Fry's Greenfield Plaza 1,597,884.71
551 Ames Plaza (Amenia) 1,595,195.82
553 Hilltop Village Shopping Center 1,594,743.67
554 Friendly Square Shopping Center 1,588,764.57
558 8614 Burton Way Apts. 1,548,751.88
562 Port Jefferson Medical Park 1,520,687.32
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 8 of 8
Conduit ** FINAL BLACK ** Report:
Records: 225 WED, MAY 27, 1998 4:05 PM
Balance: 1,412,061,347.98 Prepared by: CTHOMAS
Selection: Actual/360; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
563 Ashcroft Industrial Park 1,515,445.10
564 8586-8588 Potter Park Drive (Palmer Ranc 1,498,880.08
566 Villa Fontana Apartments 1,496,067.38
577 Garage Loft Apartments 1,435,402.50
583 Imperial Plaza Office Building 1,398,946.34
584 Overlook Court 1,398,927.25
589 66 West 84th Street 1,376,574.41
596 Shoppes of Pembroke 1,326,253.83
597 Normandy Retail Center 1,298,285.64
600 238-268 Post Road 1,295,028.76
607 Rincon Plaza 1,253,340.82
612 222 Post Road 1,215,334.67
614 Kennestone Corners Business Center 1,197,430.82
619 Lexington Village Apartments 1,149,068.46
631 Nob Hill Office Park 1,048,643.01
632 North Post Oak Business Center 1,047,141.55
635 Dillard Office Building 997,934.48
636 128th Street Warehouse 997,930.56
644 The In-Line Shop Space (Chandler) 972,608.45
647 Dahnert Park Apartments 957,508.82
652 Pier 1 Imports 899,313.12
655 Francesca Apartments 879,261.42
<PAGE>
EXHIBIT I-XXIV
================================================================================
LEHMAN BROTHERS Page 1 of 4
Conduit ** FINAL BLACK ** Report:
Records: 97 WED, MAY 27, 1998 4:16 PM
Balance: 769,758,392.58 Prepared by: CTHOMAS
Selection: HYPER S:\SCHANG\CONDMAY\COND0520
================================================================================
Exceptions to Rep XXIV (ARD Locus)
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
2 Broadmoor Austin 154,000,000.00
3 Fox Valley Mall 85,527,649.00
4 Hawthorn Center 77,863,877.00
10 Ohio Edison Office Building 22,468,036.24
17 Hickory Ridge Commons Shopping Center 17,952,727.94
22 Stallings Portfolio (Loan Level) 16,277,350.35
26 Levittown Trace Apartments 14,522,217.09
43 Highland Pinetree Apartments 12,389,735.13
46 Hulen Bend Center 12,168,124.07
49 Golf Glen Mart Plaza 11,863,983.65
50 Clearwater Crossing Shopping Center 11,569,846.73
63 Maplewood Center 9,745,742.13
73 North Willow Commons Shopping Center 9,205,383.81
80 Briarcliffe Lakeside Apartments 8,776,084.48
81 Daytona Beach Hilton Oceanfront Resort 8,281,860.32
83 North Oaks Plaza 8,093,897.78
97 Classic Portfolio (Roll-up) 7,201,769.35
98 Oak Hills Medical Plaza 7,181,443.42
103 Colleyville Court 7,081,449.20
104 Tlaquepaque Arts & Crafts Village 7,055,984.78
107 Hulen Fashion Center 6,968,150.86
111 Sunscape West Apartments 6,839,980.49
114 Le Med Apartments 6,744,467.08
119 City Center Building 6,656,983.36
122 New Market Mall 6,584,429.79
124 Playa Blanca Apartments 6,582,428.06
125 Minges Brook Mall 6,574,953.93
131 Pelham at Hyland Business Center 6,402,356.16
143 Linden Court Apartments 6,190,931.25
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 2 of 4
Conduit ** FINAL BLACK ** Report:
Records: 97 WED, MAY 27, 1998 4:16 PM
Balance: 769,758,392.58 Prepared by: CTHOMAS
Selection: HYPER S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
151 Emerald Apartments 5,984,430.12
157 Payne Ranch Centre 5,785,128.07
162 Ashby Square West Shopping Center 5,685,607.37
164 Commerce Park of Palm Beach County 5,585,217.47
172 73 Spring Street Limited Partnership 5,382,520.27
179 One Sentry Parkway 5,292,378.31
200 Southpoint Shopping Center 4,735,219.11
201 Provincial Towers Apartments 4,662,868.47
208 Village Faire Shoppes 4,489,166.80
210 South Ridge Apartments 4,485,830.01
216 Chesapeake Square 4,393,749.31
224 Kingston Apartments 4,180,514.34
225 Glengary Shopping Center 4,174,404.10
231 Karl Plaza Shopping Center 4,114,484.43
232 Villa Serrano 4,111,868.60
241 Oakwood Apartments 3,990,036.80
243 5210 Maryland Way Office Building 3,987,379.97
257 Versailles of Rockford 3,750,108.50
259 Tri-County Square 3,688,584.07
262 Roswell Mill Office Buildings 3,614,244.75
263 Highland Tech Center 3,597,169.25
264 Stor-All Properties 3,594,923.24
265 Parole Office Park 3,594,810.39
279 Terrace View Apartments 3,431,073.27
285 White Mountain Village 3,390,568.02
287 Shepherdsville Square 3,389,509.68
298 Marketplace Shopping Center (Williamsburg-Loan Level) 3,291,905.50
306 Manchester Square 3,239,972.50
326 General Cinema 3,090,238.46
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 3 of 4
Conduit ** FINAL BLACK ** Report:
Records: 97 WED, MAY 27, 1998 4:16 PM
Balance: 769,758,392.58 Prepared by: CTHOMAS
Selection: HYPER S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
328 Valencia Gardens Apartments 3,071,470.37
331 Woodmere Apartments 3,032,111.26
341 Timberfalls Apartments 2,955,617.80
347 Greenbrier Valley Mall 2,891,052.37
352 Maple Plaza Shopping Center 2,792,929.95
355 West Court Office Building 2,745,987.29
358 Century Analysis, Inc., Building 2,696,563.47
367 Park East Apartments 2,596,160.04
368 Shadow Trail Apartments 2,593,160.14
369 Inn at Saratoga 2,588,127.92
378 K-Mart Plaza Shopping Center (Galveston) 2,494,392.42
379 303 Winding Road 2,491,811.51
414 Wanamassa Gardens Apartments 2,254,135.36
420 Hillcroft Plaza Shopping Center 2,205,232.78
422 Olde Towne Shopping Center 2,197,192.71
423 5 Walk-Up Residential Buildings (Formerly 70 East) 2,197,106.08
428 Sneaker Stadium 2,193,031.27
454 3848-3870 East Foothill Boulevard (East Pasadena) 2,096,994.77
475 Shops at State Bridge 1,995,371.55
483 Shannon Square 1,947,537.00
501 Western Hills Shopping Center 1,892,853.54
504 Crystal Inn (Brigham City) 1,891,128.86
518 Village Woods Commons Shopping Center 1,792,241.27
525 Galaxy Shopping Center 1,745,149.43
526 Crestwood Station Shopping Center 1,744,600.57
529 Price Savers Center 1,722,787.60
531 Caledon Wood Professional Park 1,705,674.66
537 336 Washington Street (Boston Private) 1,697,590.85
553 Hilltop Village Shopping Center 1,594,743.67
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 4 of 4
Conduit ** FINAL BLACK ** Report:
Records: 97 WED, MAY 27, 1998 4:16 PM
Balance: 769,758,392.58 Prepared by: CTHOMAS
Selection: HYPER S:\SCHANG\CONDMAY\COND0520
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
562 Port Jefferson Medical Park 1,520,687.32
563 Ashcroft Industrial Park 1,515,445.10
577 Garage Loft Apartments 1,435,402.50
583 Imperial Plaza Office Building 1,398,946.34
589 66 West 84th Street 1,376,574.41
596 Shoppes of Pembroke 1,326,253.83
632 North Post Oak Business Center 1,047,141.55
644 The In-Line Shop Space (Chandler) 972,608.45
647 Dahnert Park Apartments 957,508.82
652 Pier 1 Imports 899,313.12
================================================================================
<PAGE>
Exhibit I-XXVI
================================================================================
LEHMAN BROTHERS Page 1 of 1
Conduit ** FINAL BLACK ** Report:
Records: 4 WED, MAY 27, 1998 2:36 PM
Balance: 181,977,497.71 Prepared by: CTHOMAS
Selection: S:\SCHANG\CONDMAY\COND0520
================================================================================
Exceptions to Rep XXVI (future sub-debt)
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
102 West Georgia Commons 7,094,294.06
29 Statesboro Mall 14,288,507.76
120 Dublin Mall 6,594,695.89
2 Broadmoor Austin 154,000,000.00
================================================================================
<PAGE>
================================================================================
Current Sub-Debt LEHMAN BROTHERS Page 1 of 1
Conduit ** FINAL BLACK ** Report:
Records: 10 WED, MAY 27, 1998 2:38 PM
Balance: 56,534,820.95 Prepared by: CTHOMAS
Selection: Subordinate Debt; Lehman Bros. Pool S:\SCHANG\CONDMAY\CONDO52O
================================================================================
Exceptions to Rep XXVI (current sub-debt)
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
20 Richardson Highlands 16,847,577.42
51 Rivercrest Village Apartments 11,564,174.06
122 New Market Mall 6,584,429.79
162 Ashby Square West Shopping Center 5,685,607.37
259 Tri-County Square 3,688,584.07
287 Shepherdsville Square 3,389,509.68
306 Manchester Square 3,239,972.50
347 Greenbrier Valley Mall 2,891,052.37
526 Crestwood Station Shopping Center 1,744,600.57
652 Pier 1 Imports 899,313.12
================================================================================
<PAGE>
Exhibit I-XXVII
================================================================================
LEHMAN BROTHERS Page 1 of 1
Conduit ** FINAL BLACK ** Report:
Records: 24 WED, MAY 27, 1998 4:10 PM
Balance: 122,113,846.50 Prepared by: CTHOMAS
Selection: lx; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
Exceptions to Rep XXVII (1x assumable)
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
12 Holiday Inn Downtown 21,840,552.21
51 Rivercrest Village Apartments 11,564,174.06
75 Village Green Apartments 9,177,123.74
89 Hampton Inn (Louisville) 7,771,500.87
98 Oak Hills Medical Plaza 7,181,443.42
125 Minges Brook Mall 6,574,953.93
152 MacArthur Plaza I & II 5,983,970.74
174 Club at Woodland Pond 5,355,892.91
204 Park Plaza - Salem 4,588,483.58
233 Kendale Plaza Shopping Center 4,094,344.90
241 Oakwood Apartments 3,990,036.80
245 Fashion Village and East Colonial Shopping Centers 3,932,520.25
260 Bethesda Court Hotel 3,636,395.34
269 Miami Gardens Plaza 3,591,048.41
298 Marketplace Shopping Center (Williamsburg-Loan Level) 3,291,905.50
303 Foothills Villas Apartments 3,264,848.02
344 University Village Shopping Center 2,936,468.90
369 Inn at Saratoga 2,588,127.92
403 Eckerd Drug Store (Lexington) 2,340,959.27
416 River Oaks Apartments 2,246,834.81
473 Auto/Retail Facility (Lauderhill) 1,997,734.77
551 Ames Plaza (Amenia) 1,595,195.82
562 Port Jefferson Medical Park 1,520,687.32
631 Nob Hill Office Park 1,048,643.01
================================================================================
<PAGE>
================================================================================
LEHMAN BROTHERS Page 1 of 1
Conduit ** FINAL BLACK ** Report:
Records: 1 WED, MAY 27, 1998 4:10 PM
Balance: 2,192,153.17 Prepared by: CTHOMAS
Selection: 2x; Lehman Bros. Pool S:\SCHANG\CONDMAY\COND0520
================================================================================
Exceptions to Rep (XXVII) (2x assumable)
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
429 Andora Apartments 2,192,153.17
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 1 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
Exceptions to Rep XXVII (lenders consent)
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
1 IBM Corporate Office Complex 178,378,814.33
2 Broadmoor Austin 154,000,000.00
3 Fox Valley Mall 85,527,649.00
4 Hawthorn Center 77,863,877.00
9 Musselman Portfolio (Roll-Up) 23,892,525.17
10 Ohio Edison Office Building 22,468,036.24
14 St. Andrews Place 20,942,733.05
17 Hickory Ridge Commons Shopping Center 17,952,727.94
19 1066 Third Avenue (Royale Retail Condominiums) 17,344,007.86
20 Richardson Highlands 16,847,577.42
22 Stallings Portfolio (Loan Level) 16,277,350.35
26 Levittown Trace Apartments 14,522,217.09
27 Chester Mall 14,488,711.07
29 Statesboro Mall 14,288,507.76
30 Days Inn & Suites Historic Savannah 13,770,454.32
32 Sandy Mall 13,738,706.98
35 Temple City Square 13,269,824.24
40 North Atherton Place 12,469,243.47
42 GTE Sternmons Crossing 12,400,000.00
43 Highland Pinetree Apartments 12,389,735.13
44 Westmont Business Park (Roll-up) 12,218,749.98
45 Wyndham Garden Hotel 12,204,210.32
46 Hulen Bend Center 12,168,124.07
47 Cineplex Odeon Movie Theater 12,124,123.68
49 Golf Glen Mart Plaza 11,863,983.65
50 Clearwater Crossing Shopping Center 11,569,846.73
52 Super K-Mart Center 11,283,800.93
54 Market at Wolfcreek 10,947,916.37
59 Concorde Centre II Office Building 10,500,000.00
================================================================================
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 2 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
63 Maplewood Center 9,745,742.13
66 Inverrary 441 Apartments 9,586,461.99
70 Hampton Inn Pensacola Beach 9,250,000.00
73 North Willow Commons Shopping Center 9,205,383.81
74 International Club Apartments 9,186,994.22
83 North Oaks Plaza 8,093,897.78
87 1616 Walnut Street 7,794,129.65
92 White Marlin Mall, Phase I 7,743,942.22
97 Classic Portfolio (Roll-up) 7,201,769.35
100 Kensington Club Apartments 7,131,286.58
102 West Georgia Commons 7,094,294.06
103 Colleyville Court 7,081,449.20
104 Tlaquepaque Arts & Crafts Village 7,055,984.78
107 Hulen Fashion Center 6,968,150.86
110 City Place 6,892,159.81
111 Sunscape West Apartments 6,839,980.49
114 Le Med Apartments 6,744,467.08
116 Westminster Plaza 6,690,963.03
119 City Center Building 6,656,983.36
120 Dublin Mall 6,594,695.89
122 New Market Mall 6,584,429.79
123 Highgate Apartments 6,583,249.29
124 Playa Blanca Apartments 6,582,428.06
131 Pelham at Hyland Business Center 6,402,356.16
136 Officemax and Best Buy 6,320,000.00
137 Two Executive Boulevard 6,295,095.15
143 Linden Court Apartments 6,190,931.25
144 Serra Commons Apartments 6,177,199.24
145 A & P Grocery Store 6,163,226.67
================================================================================
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 3 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
148 Holiday Inn City Center 6,073,664.24
149 53, 53-West, and 102 Commerce Center 5,993,027.80
151 Emerald Apartments 5,984,430.12
154 Evergreen Plaza 5,982,208.81
155 21 DuPont Circle 5,795,439.34
156 1-3 Parklands Drive (Parkland Office Park) 5,792,389.77
157 Payne Ranch Centre 5,785,128.07
161 Wickes Shopping Center 5,707,136.81
162 Ashby Square West Shopping Center 5,685,607.37
164 Commerce Park of Palm Beach County 5,585,217.47
172 73 Spring Street Limited Partnership 5,382,520.27
178 Whole Foods Market 5,331,911.30
179 One Sentry Parkway 5,292,378.31
187 Budgetel Inn 4,994,436.22
188 Hillside Village Center 4,993,729.36
191 Thrifty's (Roll-Up) 4,936,933.47
193 Tiffany Corner Shopping Center 4,904,313.30
194 Timbers of Pine Hollow Apartments 4,896,093.16
200 Southpoint Shopping Center 4,735,219.11
201 Provincial Towers Apartments 4,662,868.47
202 Royal Palms Mobile Home/RV Park 4,600,000.00
208 Village Faire Shoppes 4,489,166.80
209 South Trust Building 4,488,810.52
210 South Ridge Apartments 4,485,830.01
214 Minges Creek Plaza 4,445,732.34
215 TransFlorida Bank Plaza 4,393,961.09
216 Chesapeake Square 4,393,749.31
217 Orchard Plaza 4,389,461.37
220 J.P. Morgan Building 4,196,597.85
================================================================================
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 4 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
224 Kingston Apartments 4,180,514.34
225 Glengary Shopping Center 4,174,404.10
226 1696 and 1700 to 1712 Newport Boulevard 4,164,473.16
230 Walgreens Pharmacy (Chicago) 4,119,422.58
231 Karl Plaza Shopping Center 4,114,484.43
232 Villa Serrano 4,111,868.60
235 Best Buy (Little Rock) 4,092,586.34
236 Alice Nettell Tower 4,085,108.18
243 5210 Maryland Way Office Building 3,987,379.97
252 Merrill Crossing Shopping Ctr. 3,790,289.55
253 River Creek Apartments 3,788,034.64
257 Versailles of Rockford 3,750,108.50
258 Lynnwood Manor Health Care Center 3,746,037.63
259 Tri-County Square 3,688,584.07
262 Roswell Mill Office Buildings 3,614,244.75
263 Highland Tech Center 3,597,169.25
264 Stor-All Properties 3,594,923.24
265 Parole Office Park 3,594,810.39
266 McEvers Corners 3,591,540.48
268 Courtyards Apartments 3,591,078.89
271 Webtron Building 3,547,375.75
276 Best Buy (Sioux Falls) 3,475,000.00
277 Parkway Nursing Home 3,446,354.62
279 Terrace View Apartments 3,431,073.27
284 Fidelity Federal Bank Building 3,392,923.73
285 White Mountain Village 3,390,568.02
287 Shepherdsville Square 3,389,509.68
289 100 Broadway 3,380,435.75
293 Green Center (MCG) 3,343,708.47
================================================================================
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 5 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39
296 Everett I-5 Mini-Storage 3,295,515.58
302 Sussex Downs Apartments 3,266,130.06
306 Manchester Square 3,239,972.50
310 Swall Towers East 3,197,448.60
312 Hillside Village Plaza 3,191,710.26
314 Kaiser Permanente Health Center 3,184,959.64
316 Swall Towers West 3,147,488.47
319 Salt Lake Medical Plaza Office Building 3,134,338.76
322 Carriage Hills Apartments 3,113,343.36
323 Village on the Pike Shopping Center 3,097,528.33
326 General Cinema 3,090,238.46
328 Valencia Gardens Apartments 3,071,470.37
331 Woodmere Apartments 3,032,111.26
334 Rain Forest Apartments 2,997,655.06
335 Nexstar Pharmaceuticals Building 2,997,612.80
341 Timberfalls Apartments 2,955,617.80
347 Greenbrier Valley Mall 2,891,052.37
352 Maple Plaza Shopping Center 2,792,929.95
355 West Court Office Building 2,745,987.29
357 Paradise Shopping Plaza 2,697,988.17
358 Century Analysis, Inc., Building 2,696,563.47
361 Dolly Creek Shopping Center 2,672,871.41
367 Park East Apartments 2,596,160.04
368 Shadow Trail Apartments 2,593,160.14
371 Marketplace at Ken Caryl 2,547,125.71
379 303 Winding Road 2,491,811.51
383 Hillside Apartments 2,472,995.16
384 Walgreen Store (Wolfcreek) 2,467,814.73
================================================================================
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 6 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
388 Miramar/Chapparone Auto Center 2,448,027.16
390 Jefferson Centre 2,446,687.19
393 Central Park Professional Center 2,396,615.50
406 1803 Park Center Drive 2,322,167.35
414 Wanamassa Gardens Apartments 2,254,135.36
418 Timm Office Building 2,222,028.77
420 Hillcroft Plaza Shopping Center 2,205,232.78
422 Olde Towne Shopping Center 2,197,192.71
423 5 Walk-Up Residential Buildings (Formerly 70 East) 2,197,106.08
425 Days Inn (Winter Park) 2,195,718.51
428 Sneaker Stadium 2,193,031.27
431 3610 Birch Street (Apollo Office Building) 2,183,388.13
432 Walgreens Pharmacy (Miami) 2,170,234.76
441 FAA Building 2,141,611.88
448 Walgreens - Richmond 2,100,455.05
449 Stoughton Plaza 2,098,425.83
450 PetsMart Inc. 2,098,410.02
451 Cobblestone Village Shopping Center 2,098,381.24
454 3848-3870 East Foothill Boulevard (East Pasadena) 2,096,994.77
464 Rite Aid Pharmacy (Liberty) 2,080,599.32
466 CVS Pharmacy (Philadelphia) 2,074,140.20
471 CVS Drug Store (Martinsville) 2,038,393.46
474 Campostella Corners Shopping Center 1,997,261.83
475 Shops at State Bridge 1,995,371.55
480 Hampton Inn (Musselman-Elizabethtown) 1,991,043.78
479 Fairfield Inn (Musselman-Mt.Sterling) 1,991,043.78
483 Shannon Square 1,947,537.00
494 Eckerd Drug Store (Jacksonville) 1,905,798.57
496 Gardner Plaza 1,898,520.76
================================================================================
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 7 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
498 Officemax Free-Standing Retail/Commercial Building 1,897,760.17
500 The In-Line Retail Shop Space (Peoria) 1,893,035.93
501 Western Hills Shopping Center 1,892,853.54
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
504 Crystal Inn (Brigham City) 1,891,128.86
512 Revco Pharmacy (Decatur) 1,840,419.99
515 121 Greene Street 1,800,000.00
516 Payson Center 1,797,620.30
518 Village Woods Commons Shopping Center 1,792,241.27
521 CVS Pharmacy (Lancaster) 1,765,000.00
525 Galaxy Shopping Center 1,745,149.43
526 Crestwood Station Shopping Center 1,744,600.57
527 Village Pines 1,742,848.98
529 Price Savers Center 1,722,787.60
530 Indian Village Shopping Center 1,708,262.64
531 Caledon Wood Professional Park 1,705,674.66
532 4445 West 16th Street 1,698,200.81
533 6 Fortune Drive 1,697,966.99
536 Georgetown Village Apartments 1,697,602.64
537 336 Washington Street (Boston Private) 1,697,590.85
540 La Jolla Court Apartments 1,652,187.67
542 Hodges Warehouse (Hodges II) 1,645,107.98
544 Eckerd Drug Store (Camden) 1,631,475.16
545 CVS Drug Store (Mableton) 1,605,822.34
548 Fry's Greenfield Plaza 1,597,884.71
553 Hilltop Village Shopping Center 1,594,743.67
554 Friendly Square Shopping Center 1,588,764.57
558 8614 Burton Way Apts. 1,548,751.88
559 Four Industrial Buildings (Great S.W. Industrial) 1,546,386.62
================================================================================
<PAGE>
===============================================================================
LEHMAN BROTHERS Page 8 of 8
Conduit ** FINAL BLACK ** Report:
Records: 235 WED, MAY 27, 1998 4:10 PM
Balance: 1,559,551,228.61 Prepared by: CTHOMAS
Selection: Assumable With Lenders Consent; S:\SCHANG\CONDMAY\COND0520
Lehman Bros. Pool
===============================================================================
-------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
-------------------------------------------------------------------------------
563 Ashcroft Industrial Park 1,515,445.10
564 8586-8588 Potter Park Drive (Palmer Ranch) 1,498,880.08
566 Villa Fontana Apartments 1,496,067.38
577 Garage Loft Apartments 1,435,402.50
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
583 Imperial Plaza Office Building 1,398,946.34
584 Overlook Court 1,398,927.25
589 66 West 84th Street 1,376,574.41
596 Shoppes of Pembroke 1,326,253.83
597 Normandy Retail Center 1,298,285.64
600 238-268 Post Road 1,295,028.76
607 Rincon Plaza 1,253,340.82
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
612 222 Post Road 1,215,334.67
614 Kennestone Corners Business Center 1,197,430.82
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
617 CVS Pharmacy (Westbrook) 1,162,826.18
619 Lexington Village Apartments 1,149,068.46
632 North Post Oak Business Center 1,047,141.55
634 Randall Court Apartments 1,012,794.54
635 Dillard Office Building 997,934.48
636 128th Street Warehouse 997,930.56
640 Wolfpack Village Apartments 995,293.89
644 The In-Line Shop Space (Chandler) 972,608.45
647 Dahnert Park Apartments 957,508.82
651 NTB Store Site 918,191.46
652 Pier 1 Imports 899,313.12
655 Francesca Apartments 879,261.42
666 Hodges Warehouse and Corporate Offices (Hodges I) 747,776.36
672 13348 Newport Boulevard (Walgreen - Tustin) 494,859.06
================================================================================
<PAGE>
EXHIBIT I-XXXI
Exception to Schedule I Clause (xxxi)
None
<PAGE>
EXHIBIT I-XL
Exception to Schedule I Clause (xl)
None
<PAGE>
EXHIBIT I-XLVI
================================================================================
LEHMAN BROTHERS Page 1 of 1
Conduit ** FINAL BLACK ** Report:
Records: 13 WED, MAY 27, 1998 4:12 PM
Balance: 247,162,146.84 Prepared by: CTHOMAS
Selection: Leasehold; Lehman Bros. Pool S:\SCHANG\CONDMAYCOND0520
================================================================================
Exceptions to Rep XLVI
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
2 Broadmoor Austin 154,000,000.00
9 Musselman Portfolio (Roll-Up) 23,892,525.17
22 Stallings Portfolio (Loan Level) 16,277,350.35
40 North Atherton Place 12,469,243.47
97 Classic Portfolio (Roll-up) 7,201,769.35
107 Hulen Fashion Center 6,968,150.86
110 City Place 6,892,159.81
145 A & P Grocery Store 6,163,226.67
191 Thrifty's (Roll-Up) 4,936,933.47
319 Salt Lake Medical Plaza Office Building 3,134,338.76
441 FAA Building 2,141,611.88
530 Indian Village Shopping Center 1,708,262.64
589 66 West 84th Street 1,376,574.41
================================================================================
<PAGE>
EXHIBIT I-XLII
XLII (A&E) FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
651 Sears, Roebuck 918,191.46
672 13348 Newport Boulevard (Walgreen - Tustin) 494,859.06
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT II-A
Exception to Schedule II Clause (i)(A)
None
<PAGE>
EXHIBIT II-B
FULBBA 1998-C2
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
110 City Place 6,892,159.81
530 Indian Village Shopping Center 1,708,262.64
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Ground Lease Rep (i)(B)
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT II-J
Exception to Schedule II Clause (i)(J)
None
<PAGE>
EXHIBIT II-L
Exception to Schedule II Clause (i)(L)
None
<PAGE>
EXHIBIT II-II
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
2 Broadmoor Austin 154,000,000.00
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Ground Lease Rep (i)(ii)
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-A
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
52 Super K-Mart Center 11,283,800.93
145 A & P Grocery Store 6,163,226.67
230 Walgreens Pharmacy (Chicago) 4,119,422.58
282 Walgreens (Las Vegas) 3,396,544.93
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39
403 Eckerd Drug Store (Lexington) 2,340,959.27
432 Walgreens Pharmacy (Miami) 2,170,234.76
448 Walgreens - Richmond 2,100,455.05
464 Rite Aid Pharmacy (Liberty) 2,080,599.32
466 CVS Pharmacy (Philadelphia) 2,074,140.20
471 CVS Drug Store (Martinsville) 2,038,393.46
482 CVS Pharmacy (Vernon) 1,969,899.72
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
512 Revco Pharmacy (Decatur) 1,840,419.99
521 CVS Pharmacy (Lancaster) 1,765,000.00
544 Eckerd Drug Store (Camden) 1,631,475.16
545 CVS Drug Store (Mableton) 1,605,822.34
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
617 CVS Pharmacy (Westbrook) 1,162,826.18
651 Sears,Roebuck 918,191.46
672 13348 Newport Boulevard (Walgreen - Tustin) 494,859.06
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Credit Lease Rep A
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-B
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
145 A & P Grocery Store 6,163,226.67
230 Walgreens Pharmacy (Chicago) 4,119,422.58
282 Walgreens (Las Vegas) 3,396,544.93
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39
403 Eckerd Drug Store (Lexington) 2,340,959.27
432 Walgreens Pharmacy (Miami) 2,170,234.76
448 Walgreens - Richmond 2,100,455.05
464 Rite Aid Pharmacy (Liberty) 2,080,599.32
466 CVS Pharmacy (Philadelphia) 2,074,140.20
471 CVS Drug Store (Martinsville) 2,038,393.46
482 CVS Pharmacy (Vernon) 1,969,899.72
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
512 Revco Pharmacy (Decatur) 1,840,419.99
521 CVS Pharmacy (Lancaster) 1,765,000.00
544 Eckerd Drug Store (Camden) 1,631,475.16
545 CVS Drug Store (Mableton) 1,605,822.34
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
617 CVS Pharmacy (Westbrook) 1,162,826.18
651 Sears, Roebuck 918,191.46
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exceptions to Credit Lease B
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-B
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
145 A & P Grocery Store 6,163,226.67
230 Walgreens Pharmacy (Chicago) 4,119,422.58
282 Walgreens (Las Vegas) 3,396,544.93
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39
403 Eckerd Drug Store (Lexington) 2,340,959.27
432 Walgreens Pharmacy (Miami) 2,170,234.76
448 Walgreens - Richmond 2,100,455.05
464 Rite Aid Pharmacy (Liberty) 2,080,599.32
466 CVS Pharmacy (Philadelphia) 2,074,140.20
471 CVS Drug Store (Martinsville) 2,038,393.46
482 CVS Pharmacy (Vernon) 1,969,899.72
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
512 Revco Pharmacy (Decatur) 1,840,419.99
521 Pharmacy (Lancaster) 1,765,000.00
544 Eckerd Drug Store (Camden) 1,631,475.16
545 CVS Drug Store (Mableton) 1,605,822.34
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
617 CVS Pharmacy (Westbrook) 1,162,826.18
672 13348 Newport Boulevard (Walgreen - Tustin) 494,859.06
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Credit Lease Rep (B)
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-C
Exception to Schedule IV Clause (C)
None
<PAGE>
EXHIBIT IV-D
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
145 A & P Grocery Store 6,163,226.67
230 Walgreens Pharmacy (Chicago) 4,119,422.58
282 Walgreens (Las Vegas) 3,396,544.93
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39
403 Eckerd Drug Store (Lexington) 2,340,959.27
432 Walgreens Pharmacy (Miami) 2,170,234.76
448 Walgreens - Richmond 2,100,455.05
464 Rite Aid Pharmacy (Liberty) 2,080,599.32
466 CVS Pharmacy (Philadelphia) 2,074,140.20
471 CVS Drug Store (Martinsville) 2,038,393.46
482 CVS Pharmacy (Vernon) 1,969,899.72
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
512 Revco Pharmacy (Decatur) 1,840,419.99
521 CVS Pharmacy (Lancaster) 1,765,000.00
544 Eckerd Drug Store (Camden) 1,631,475.16
545 CVC Drug Store (Mableton) 1,605,822.34
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
617 CVS Pharmacy (Westbrook) 1,162,826.18
672 13348 Newport Boulevard (Walgreen - Tustin) 494,859.06
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Credit Lease Rep D
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-E
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
52 Super K-Mart Center 11,283,800.93
145 A & P Grocery Store 6,163,226.67
230 Walgreens Pharmacy (Chicago) 4,119,422.58
282 Walgreens (Las Vegas) 3,396,544.93
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39
403 Eckerd Drug Store (Lexington) 2,340,959.27
432 Walgreens Pharmacy (Miami) 2,170,234.76
448 Walgreens - Richmond 2,100,455.05
464 Rite Aid Pharmacy (Liberty) 2,080,599.32
466 CVS Pharmacy (Philadelphia) 2,074,140.20
471 CVS Drug Store (Martinsville) 2,038,393.46
482 CVS Pharmacy (Vernon) 1,969,899.72
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
512 Revco Pharmacy (Decatur) 1,840,419.99
521 CVS Pharmacy (Lancaster) 1,765,000.00
544 Eckerd Drug Store (Camden) 1,631,475.16
545 CVS Drug Store (Mableton) 1,605,822.34
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
617 CVS Pharmacy (Westbrook) 1,162,826.18
651 Sears, Roebuck 918,191.46
672 13348 Newport Boulevard (Walgreen - Tustin) 494,859.06
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exceptions to Credit Lease Rep E
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-G
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
466 CVS Pharmacy (Philadelphia) 2,074,140.20
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Credit Lease Rep (G)
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-H
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
52 Super K-Mart Center 11,283,800.93
145 A & P Grocery Store 6,163,226.67
230 Walgreens Pharmacy (Chicago) 4,119,422.58
282 Walgreens (Las Vegas) 3,396,544.93
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39
403 Eckerd Drug Store (Lexington) 2,340,959.27
432 Walgreens Pharmacy (Miami) 2,170,234.76
448 Walgreens - Richmond 2,100,455.05
464 Rite Aid Pharmacy (Liberty) 2,080,599.32
466 CVS Pharmacy (Philadelphia) 2,074,140.20
471 CVS Drug Store (Martinsville) 2,038,393.46
482 CVS Pharmacy (Vernon) 1,969,899.72
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
512 Revco Pharmacy (Decatur) 1,840,419.99
521 CVS Pharmacy (Lancaster) 1,765,000.00
544 Eckerd Drug Store (Camden) 1,631,475.16
545 CVS Drug Store (Mableton) 1,605,822.34
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
617 CVS Pharmacy (Westbrook) 1,162,826.18
651 Sears, Roebuck 918,191.46
672 13348 Newport Boulevard (Walgreen - Tustin) 494,859.06
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Credit Lease H
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-I
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL
- --------------------------------------------------------------------------------
282 Walgreens (Las Vegas) 3,396,544.93
432 Walgreens Pharmacy (Miami) 2,170,234.76
448 Walgreens - Richmond 2,100,455.05
471 CVS Drug Store (Martinsville) 2,038,393.46
502 Eckerd Drug Store (Ft. Myers) 1,892,262.33
544 Eckerd Drug Store (Camden) 1,631,475.16
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15
582 Revco Pharmacy (Oak Ridge) 1,413,228.06
608 Eckerd Store (Mt. Holly) 1,235,810.25
611 Eckerd Store (Florence) 1,217,660.73
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Credit Lease Rep I
================================================================================
Page 1 of 1
<PAGE>
EXHIBIT IV-J
Exception to Schedule IV Clause (J)
None
<PAGE>
EXHIBIT IV-L
FULBBA 1998-C2
================================================================================
- --------------------------------------------------------------------------------
PROSPID PROPNAME CURBAL GUARANTOR
- --------------------------------------------------------------------------------
230 Walgreens Pharmacy (Chicago) 4,119,422.58 Walgreen Co.
295 Walgreens Pharmacy (Chicago Heights) 3,297,412.39 Walgreen Co.
464 Rite Aid Pharmacy (Liberty) 2,080,599.32 Rite Aid Corporation
466 CVS Pharmacy (Philadelphia) 2,074,140.20 CVS Corporation
471 CVS Drug Store (Martinsville) 2,038,393.46 Revco D.S., Inc.
482 CVS Pharmacy (Vernon) 1,969,899.72 CVS Corporation
512 Revco Pharmacy (Decatur) 1,840,419.99 CYS Corporation
521 CVS Pharmacy (Lancaster) 1,765,000.00 CVS Corporation
545 CVS Drug Store (Mableton) 1,605,822.34 CVS Corporation
578 Rite-Aid Pharmacy (Waynesburg) 1,426,496.18 Rite Aid Corporation
581 Rite Aid Pharmacey (Hogansville) 1,413,906.15 Rite Aid Corporation
582 Revco Pharmacy (Oak Ridge) 1,413,228.06 Revco D.S., Inc.
616 Rite Aid Pharmacy (Williamsport) 1,192,416.56 Rite Aid Corporation
617 CVS Pharmacy (Westbrook) 1,162,826.18 CVS Corporation
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Exception to Credit Lease Rep L
================================================================================
Page 1 of 1
<PAGE>
Exhibit 99.2
EXECUTION
MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement, dated as of May 1, 1998 (the
"Agreement"), between First Union National Bank (the "Seller") and First Union
Commercial Mortgage Securities, Inc. (the "Purchaser").
The Seller intends to sell and the Purchaser intends to purchase
certain multifamily and commercial mortgage loans (the "FUNB Mortgage Loans") as
provided herein. The Purchaser intends to deposit them, together with the Other
Mortgage Loans (as defined below), into a trust fund (the "Trust Fund"), the
beneficial ownership of which will be evidenced by multiple classes (each, a
"Class") of mortgage pass-through certificates (the "Certificates"). One or more
"real estate mortgage investment conduit" ("REMIC") elections will be made with
respect to the Trust Fund. The Trust Fund will be created and the Certificates
will be issued pursuant to a Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of the Cut-off Date, among the Purchaser as
depositor, First Union National Bank as master servicer (in such capacity, the
"Master Servicer"), CRIIMI MAE Services Limited Partnership as special servicer
(in such capacity, the "Special Servicer"), and Norwest Bank Minnesota, National
Association as trustee (the "Trustee"). Concurrently with the purchase of the
FUNB Mortgage Loans pursuant to this Agreement, the Purchaser will also purchase
certain multifamily and commercial mortgage loans (the "Other Mortgage Loans";
and, collectively with the FUNB Mortgage Loans, the "Mortgage Loans") pursuant
to two Mortgage Loan Purchase Agreements, each dated as of May 1, 1998, between,
in one case, Bank of America NT&SA and the Purchaser, and between, in the other
case, Lehman Brothers Holdings Inc., doing business as Lehman Capital, a
division of Lehman Brothers Holdings Inc. and the Purchaser. The Other Mortgage
Loans will likewise be deposited into the Trust Fund. Capitalized terms used but
not defined herein have the respective meanings set forth in the Pooling and
Servicing Agreement.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
(a) The Seller agrees to sell, and the Purchaser agrees to purchase,
the FUNB Mortgage Loans identified on the schedule (the "Mortgage Loan
Schedule") annexed hereto as Exhibit A. The Mortgage Loan Schedule may be
amended to reflect the actual Mortgage Loans delivered to the Purchaser pursuant
to the
<PAGE>
terms hereof. The FUNB Mortgage Loans will have an aggregate principal balance
of $1,346,142,262.35 (the "FUNB Balance") (subject to a variance of plus or
minus 5.0%) as of the close of business on the Cut-off Date, after giving effect
to any payments due on or before such date whether or not received. The FUNB
Balance, together with the aggregate principal balance of the Other Mortgage
Loans as of the Cut-Off Date (after giving effect to any payments due on or
before such date whether or not received), shall equal an aggregate principal
balance (the "Initial Pool Balance") of $3,408,048,239 (subject to a variance of
plus or minus 5%). The purchase and sale of the FUNB Mortgage Loans shall take
place on May 28, 1998 or such other date as shall be mutually acceptable to the
parties hereto (the "Closing Date"). The consideration for the Bank of America
Mortgage Loans shall consist of a cash amount equal to $1,391,988,263 (the
"Aggregate Purchase Price") (which is equal to the FUNB Balance plus interest
accrued on the FUNB Balance at the related Net Mortgage Rate for the period from
and including the Cut-off Date up to but not including the Closing Date less
fees and expenses payable by FUNB) which cash amount shall be paid to the Seller
or its designee by wire transfer in immediately available funds on the Closing
Date.
The Purchaser will assign to the Trustee, all of its right, title
and interest in and to the FUNB Mortgage Loans.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 hereof, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Purchaser, without
recourse, all the right, title and interest of the Seller in and to the FUNB
Mortgage Loans identified on the Mortgage Loan Schedule as of such date other
than the primary servicing rights. The Mortgage Loan Schedule, as it may be
amended, shall conform to the requirements set forth in this Agreement and the
Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive all
scheduled payments of principal and interest due after the Cut-off Date, and all
other recoveries of principal and interest collected after the Cut-off Date
(other than in respect of principal and interest on the FUNB Mortgage Loans due
on or before the Cut-off Date). All scheduled payments of principal and interest
due on or before the Cut-off Date but collected after the Cut-off Date, and
recoveries of principal and interest collected on or before the Cut-off Date
(only in respect of principal and interest on the FUNB Mortgage Loans due on or
before the Cut-off Date and principal prepayments thereon), shall belong to, and
be promptly remitted to, the Seller.
(c) The Seller hereby represents and warrants that it has, on behalf
of the Purchaser, delivered to the Trustee, the
<PAGE>
documents and instruments specified below with respect to each FUNB Mortgage
Loan (each a "Mortgage File"). All Mortgage Files so delivered will be held by
the Trustee in escrow at all times prior to the Closing Date. Each Mortgage File
shall, except as otherwise disclosed on Exhibit B hereto, contain the following
documents:
(i) the original executed Mortgage Note (or a lost note affidavit
and indemnity with a copy of such Mortgage Note attached
thereto) together with any intervening endorsements thereon,
endorsed (without recourse, representation or warranty,
express or implied) to the order of NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as trustee for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 1998-C2 or in blank;
(ii) an original or copy of the Mortgage and any intervening
assignments thereof, in each case with evidence of recording
indicated thereon;
(iii) an original or copy of any related Assignment of Leases (if
such item is a document separate from the Mortgage), together
with any intervening assignments thereof, in each case with
evidence of recording indicated thereon;
(iv) an original executed assignment, in recordable form, of (a)
the Mortgage, (b) any related Assignment of Leases (if such
item is a document separate from the Mortgage) and (c) any
other recorded document relating to the Mortgage Loan
otherwise included in the Mortgage File, in favor of NORWEST
BANK MINNESOTA, NATIONAL ASSOCIATION, as trustee for the
registered holders of First Union-Lehman Brothers-Bank of
America Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2 in recordable form;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as trustee for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 1998-C2;
(vi) originals or copies of any written modification agreements in
those instances where the terms or provisions of the Mortgage
or Mortgage Note have been modified;
<PAGE>
(vii) the original or a copy of the policy or certificate of
lender's title insurance issued on the date of the origination
of such Mortgage Loan, or, if such policy has not been issued,
an irrevocable, binding commitment to issue such title
insurance policy; and
(viii) any filed copies (with evidence of filing) of any prior UCC
Financing Statements in favor of the originator of such
Mortgage Loan or in favor of any assignee prior to the Trustee
(but only to the extent the Seller had possession of such UCC
Financing Statements prior to the Closing Date) and, if there
is an effective UCC Financing Statement in favor of the Seller
on record with the applicable public office for UCC Financing
Statements, an original UCC-2 or UCC-3 assignment, in form
suitable for filing, as appropriate, in favor of NORWEST BANK
MINNESOTA, NATIONAL ASSOCIATION, as trustee for the registered
holders of First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 1998-C2; and
(ix) an original or copy of any Ground Lease, any Credit Lease and
any Lease Enhancement Policy or Guaranty.
(d) Within 30 days following the Closing Date, the Purchaser shall
submit or cause to be submitted for recordation or filing, as the case may be,
in the appropriate public office for real property records or Uniform Commercial
Code financing statements, as appropriate, each assignment of Mortgage and each
assignment of Assignment of Leases referred to in clause (iv) of subsection (c)
above and each UCC-2 and UCC-3 in favor of and delivered to the Trustee
constituting part of the Mortgage File. If any such document or instrument is
lost or returned unrecorded or unfiled, as the case may be, because of a defect
therein, then the Seller shall prepare a substitute therefor or cure such defect
or cause such to be done, as the case may be, and the Seller shall deliver such
substitute or corrected document or instrument to the Purchaser or its designee.
(e) All documents and records (except attorney-client privileged
communication and internal credit analysis of the Seller) relating to each FUNB
Mortgage Loan and in the Seller's possession (the "Additional Mortgage Loan
Documents") that are not required to be delivered to the Trustee shall be
delivered or caused to be delivered by the Seller to the Master Servicer or at
the direction of the Master Servicer to the appropriate sub-servicer, together
with any related escrow amounts and reserve amounts.
<PAGE>
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants with
the Purchaser, as of the date hereof, that:
(i) The Seller is a national banking association validly
existing under the laws of the United States of America and possesses all
requisite authority, power, licenses, permits and franchises to carry on
its business as currently conducted by it and to execute, deliver and
comply with its obligations under the terms of this Agreement.
(ii) This Agreement has been duly and validly authorized,
executed and delivered by the Seller and, assuming due authorization,
execution and delivery hereof by the Purchaser, constitutes a legal, valid
and binding obligation of the Seller, enforceable against the Seller in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights in general, as they may be
applied in the context of the insolvency of a national banking
association, and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law), and by
public policy considerations underlying the securities laws, to the extent
that such public policy considerations limit the enforceability of the
provisions of this Agreement which purport to provide indemnification from
liabilities under applicable securities laws.
(iii) The execution and delivery of this Agreement by the
Seller and the Seller's performance and compliance with the terms of this
Agreement will not (A) violate the Seller's articles of association or
By-Laws, (B) violate any law or regulation or any administrative decree or
order to which it is subject or (C) constitute a material default (or an
event which, with notice or lapse of time, or both, would constitute a
material default) under, or result in the breach of, any material
contract, agreement or other instrument to which the Seller is a party or
by which the Seller is bound.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or other governmental agency or body, which default might
have consequences that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the condition (financial or
other) or operations of the Seller or its properties or have consequences
that would materially and adversely affect its performance hereunder.
<PAGE>
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any articles of association, bylaws or any other
corporate restriction or any judgment, order, writ, injunction, decree,
law or regulation that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the ability of the Seller to
perform its obligations under this Agreement or that requires the consent
of any third person to the execution of this Agreement or the performance
by the Seller of its obligations under this Agreement (except to the
extent such consent has been obtained).
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery and
performance by the Seller of or compliance by the Seller with this
Agreement or the consummation of the transactions contemplated by this
Agreement except as have previously been obtained, and no bulk sale law
applies to such transactions.
(vii) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller that would, in the Seller's good
faith and reasonable judgment, prohibit its entering into this Agreement
or materially and adversely affect the performance by the Seller of its
obligations under this Agreement.
(viii) Under generally accepted accounting principles ("GAAP")
and for federal income tax purposes, the Seller will report the transfer
of the FUNB Mortgage Loans to the Purchaser as a sale of the FUNB Mortgage
Loans to the Purchaser in exchange for consideration consisting of (A) a
cash amount equal to the Aggregate Purchase Price. The consideration
received by the Seller upon the sale of the FUNB Mortgage Loans to the
Purchaser will constitute reasonably equivalent value and fair
consideration for the FUNB Mortgage Loans. The Seller will be solvent at
all relevant times prior to, and will not be rendered insolvent by, the
sale of the FUNB Mortgage Loans to the Purchaser. The Seller is not
selling the FUNB Mortgage Loans to the Purchaser with any intent to
hinder, delay or defraud any of the creditors of the Seller.
(b) The Seller hereby makes the representations and warranties
contained in Schedule I, Schedule II, Schedule III and Schedule IV hereto for
the benefit of the Purchaser and the Trustee for the benefit of the
Certificateholders as of the Closing Date, with respect to (and solely with
respect to) each FUNB Mortgage Loan. References in such representations and
warranties to "Mortgage Loan" and "Mortgage Loans" shall be deemed to mean "FUNB
Mortgage Loan" and "FUNB Mortgage Loans," respectively.
<PAGE>
(c) If the Seller receives written notice of a Document Defect or a
Breach pursuant to Section 2.03(a) of the Pooling and Servicing Agreement
relating to a FUNB Mortgage Loan, then the Seller, shall not later than 90 days
from receipt of such notice (or, in the case of a Document Defect or Breach
relating to a FUNB Mortgage Loan not being a "qualified mortgage" within the
meaning of the REMIC Provisions (a "Qualified Mortgage"), not later than 90 days
of any party to the Pooling and Servicing Agreement discovering such Document
Defect or Breach), if such Document Defect or Breach shall materially and
adversely affect the value of the related FUNB Mortgage Loan or the interest of
the Certificateholders therein, cure such Document Defect or Breach, as the case
may be, in all material respects, which shall include payment of losses and any
Additional Trust Fund Expenses associated therewith or, if such Document Defect
or Breach (other than omissions solely due to a document not having been
returned by the related recording office) cannot be cured within such 90-day
period, repurchase the affected FUNB Mortgage Loan at the applicable Purchase
Price not later than the end of such 90-day period; provided, however, that if
such Document Defect or Breach is capable of being cured but not within such
90-day period, such Document Defect or Breach does not relate to the FUNB
Mortgage Loan not being treated as a Qualified Mortgage, and the Seller has
commenced and is diligently proceeding with the cure of such Document Defect or
Breach within such 90-day period, such Seller shall have an additional 90 days
to complete such cure (or, failing such cure, to repurchase the related FUNB
Mortgage Loan); and provided, further, that with respect to such additional
90-day period the Seller shall have delivered an Officer's Certificate to the
Trustee setting forth the reason such Document Defect or Breach is not capable
of being cured within the initial 90-day period and what actions the Seller is
pursuing in connection with the cure thereof and stating that the Seller
anticipates that such Document Defect or Breach will be cured within the
additional 90-day period. For a period of two years from the Closing Date, so
long as there remains any Mortgage File relating to a FUNB Mortgage Loan as to
which there is any uncured Document Defect, the Seller shall provide the
Officer's Certificate to the Trustee described above as to the reasons such
Document Defect remains uncured and as to the actions being taken to pursue
cure; provided, however, that, without limiting the effect of the forgoing
provisions of this Section 3(c), if such Document Defect shall materially and
adversely affect the value of such FUNB Mortgage Loan or the interests of the
holders of the Certificate therein, the Seller shall in all cases on or prior to
the second anniversary of the Closing Date either cause such Document Defect to
be cured or repurchase the affected Mortgage Loan. Notwithstanding the
foregoing, the delivery of a commitment to issue a policy of lender's title
insurance as described in clause (xii) of Schedule I hereof in lieu of the
delivery of the actual policy of lender's title insurance shall not be
considered a Document Defect with respect to any Mortgage File if such actual
policy of insurance is delivered to the Trustee or a Custodian on
<PAGE>
its behalf not later than the 90th day following the Closing Date.
(d) In connection with any repurchase of a FUNB Mortgage Loan
contemplated hereby, the Trustee, the Custodian, the Master Servicer and the
Special Servicer shall each tender to the Seller, upon delivery to each of them
of a receipt executed by the Seller, all portions of the Mortgage File and other
documents pertaining to such Mortgage Loan possessed by it, and each document
that constitutes a part of the Mortgage File shall be endorsed or assigned to
the extent necessary or appropriate to the Seller or its designee in the same
manner, and pursuant to appropriate forms of assignment, substantially similar
to the manner and forms pursuant to which documents were previously assigned to
the Trustee.
SECTION 4. Representations and Warranties of the Purchaser. In order to induce
the Seller to enter into this Agreement, the Purchaser hereby represents and
warrants for the benefit of the Seller as of the date hereof that:
(a) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of North Carolina. The
Purchaser has the full corporate power and authority and legal right to acquire
the FUNB Mortgage Loans from the Seller and to transfer the FUNB Mortgage Loans
to the Trustee.
(b) This Agreement has been duly and validly authorized, executed
and delivered by the Purchaser, all requisite action by the Purchaser's
directors and officers has been taken in connection therewith, and (assuming the
due authorization, execution and delivery hereof by the Seller) this Agreement
constitutes the valid, legal and binding agreement of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as such enforcement
may be limited by (A) laws relating to bankruptcy, insolvency, reorganization,
receivership or moratorium, (B) other laws relating to or affecting the rights
of creditors generally, or (C) general equity principles (regardless of whether
such enforcement is considered in a proceeding in equity or at law).
(c) Except as may be required under federal or state securities laws
(and which will be obtained on a timely basis), no consent, approval,
authorization or order of, registration or filing with, or notice to, any
governmental authority or court, is required, under federal or state law, for
the execution, delivery and performance by the Purchaser of or compliance by the
Purchaser with this Agreement, or the consummation by the Purchaser of any
transaction described in this Agreement.
(d) None of the acquisition of the FUNB Mortgage Loans by the
Purchaser, the transfer of the FUNB Mortgage Loans to the Trustee, and the
execution, delivery or performance of this
<PAGE>
Agreement by the Purchaser, conflicts or will conflict with, results or will
result in a breach of, or constitutes or will constitute a default under (A) any
term or provision of the Purchaser's Articles of Incorporation or Bylaws, (B)
any term or provision of any material agreement, contract, instrument or
indenture, to which the Purchaser is a party or by which the Purchaser is bound,
or (C) any law, rule, regulation, order, judgment, writ, injunction or decree of
any court or governmental authority having jurisdiction over the Purchaser or
its assets.
(e) Under GAAP and for federal income tax purposes, the Purchaser
will report the transfer of the FUNB Mortgage Loans by the Seller to the
Purchaser as a sale of the FUNB Mortgage Loans to the Purchaser in exchange for
consideration consisting of (A) a cash amount equal to the Aggregate Purchase
Price.
SECTION 5. Closing. The closing of the sale of the FUNB Mortgage Loans (the
"Closing") shall be held at the offices of Willkie Farr & Gallagher, 787 Seventh
Avenue, New York, New York 10019-6099 at 10:00 A.M., New York time, on the
Closing Date.
The Closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller set
forth in or made pursuant to Sections 3(a) and 3(b) of this Agreement and all of
the representations and warranties of the Purchaser set forth in Section 4 of
this Agreement shall be true and correct in all material respects as of the
Closing Date; provided, however, that any material inaccuracy in any
representation and warranty set forth in or made pursuant to Section 3(b) shall
not affect the Purchaser's obligation to purchase the Mortgage Loans not
affected by such inaccuracy;
(b) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and acceptable to the
Purchaser in its reasonable discretion, shall be duly executed and delivered by
all signatories as required pursuant to the respective terms thereof;
(c) The Seller shall have delivered and released to the Trustee (or
a Custodian on its behalf) and the Master Servicer, respectively, all documents
represented to have been or required to be delivered to the Trustee and the
Master Servicer pursuant to Section 2 of this Agreement;
(d) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with in all
material respects and the Seller shall have the ability to comply with all terms
and conditions and perform all duties and obligations required to be complied
with or performed after the Closing Date; and
<PAGE>
(e) The Seller shall have paid all fees and expenses payable by it
to the Purchaser or otherwise pursuant to this Agreement as of the Closing Date.
Both parties agree to use their best efforts to perform their
respective obligations hereunder in a manner that will enable the Purchaser to
purchase the FUNB Mortgage Loans on the Closing Date.
SECTION 6. Closing Documents. The Closing Documents shall consist of the
following:
(a) This Agreement duly executed by the Purchaser and the Seller;
(b) A Certificate of the Seller, executed by a duly authorized
officer of the Seller and dated the Closing Date, and upon which the Purchaser
and the Underwriters may rely, to the effect that: (i) the representations and
warranties of the Seller in this Agreement are true and correct in all material
respects at and as of the Closing Date with the same effect as if made on such
date; and (ii) the Seller has, in all material respects, complied with all the
agreements and satisfied all the conditions on its part that are required under
this Agreement to be performed or satisfied at or prior to the date hereof;
(c) An Officer's Certificate from an officer of the Seller, dated
the Closing Date, and upon which the Purchaser may rely, to the effect that each
individual who, as an officer or representative of the Seller, signed this
Agreement or any other document or certificate delivered on or before the
Closing Date in connection with the transactions contemplated herein, was at the
respective times of such signing and delivery, and is as of the Closing Date,
duly elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such documents
and certificates are their genuine signatures;
(d) An Officer's Certificate from an officer of the Seller, dated
the Closing Date, and upon which the Purchaser and the Underwriters may rely, to
the effect that (i) such officer has carefully examined the Prospectus and
nothing has come to his attention that would lead him to believe that the
Prospectus, as of the date of the Prospectus Supplement or as of the Closing
Date, included or includes any untrue statement of a material fact relating to
the FUNB Mortgage Loans or omitted or omits to state therein a material fact
necessary in order to make the statements therein relating to the FUNB Mortgage
Loans, in light of the circumstances under which they were made, not misleading,
and (ii) such officer has examined the Memorandum and nothing has come to his
attention that would lead him to believe that the Memorandum, as of the date
thereof or as of the Closing Date, included or includes any untrue statement of
a material fact relating to the FUNB Mortgage Loans or omitted or omits to state
<PAGE>
therein a material fact necessary in order to make the statements therein
related to the FUNB Mortgage Loans, in the light of the circumstances under
which they were made, not misleading.
(e) The resolutions of the requisite committee of the Seller's board
of directors authorizing the Seller's entering into the transactions
contemplated by this Agreement, the articles of association and by-laws of the
Seller, and a certificate of good standing of the Seller issued by the Office of
the Comptroller of the Currency of the United States not earlier than sixty (60)
days prior to the Closing Date;
(f) A written opinion of counsel for the Seller, substantially in
the form of Schedule V, with any modifications required by the Purchaser, its
counsel or Rating Agencies, dated the Closing Date and addressed to the
Purchaser, the Trustee, the Underwriters and each of the Rating Agencies,
together with such other written opinions as may be required by the Rating
Agencies; and
(g) Such further certificates, opinions and documents as the
Purchaser may reasonably request.
SECTION 7. Indemnification.
(a) The Seller shall indemnify and hold harmless the Purchaser, the
Underwriters, their respective officers and directors, and each person, if any,
who controls the Purchaser or any Underwriter within the meaning of either
Section 15 of the Securities Act of 1933, as amended (the "1933 Act") or Section
20 of the Securities Exchange Act of 1934, as amended (the "1934 Act"), against
any and all losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the 1933 Act, the 1934 Act or other
federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) (i) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in (A) the Prospectus Supplement,
the Memorandum, the Diskette or, insofar as they are required to be filed as
part of the Registration Statement pursuant to the No-Action Letters, any
Computational Materials or ABS Term Sheets with respect to the Registered
Certificates, or in any revision or amendment of or supplement to any of the
foregoing or (B) any items similar to Computational Materials and ABS Term
Sheets forwarded to prospective investors in the Non-Registered Certificates, or
(ii) arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; but only if and to the extent that (I) any such untrue
statement or alleged untrue statement or omission or alleged omission arises out
of or is based upon an untrue statement or omission with respect to the FUNB
Mortgage Loans, the related Mortgagors and/or
<PAGE>
the related Mortgaged Properties contained in the Data File (it being herein
acknowledged that the Data File was used to prepare the Prospectus Supplement
including without limitation Annex A thereto, the Memorandum, the Diskette, the
Computational Materials and ABS Term Sheets with respect to the Registered
Certificates and any items similar to Computational Materials and ABS Term
Sheets forwarded to prospective investors in the Non-Registered Certificates),
(II) any such untrue statement or alleged untrue statement or omission or
alleged omission of a material fact is with respect to, or arises out of or is
based upon an untrue statement or omission of a material fact with respect to,
the information regarding the FUNB Mortgage Loans, the related Mortgagors, the
related Mortgaged Properties and/or the Seller set forth (X) in the Prospectus
Supplement and the Memorandum under the headings "Summary of the Prospectus
Supplement--The Mortgage Pool" or "Summary of the Memorandum--The Mortgage
Pool", as applicable, "Risk Factors--The Mortgage Loans" and "Description of the
Mortgage Pool" and (Y) on Annex A to the Prospectus Supplement and, to the
extent consistent therewith, on the Diskette, or (III) any such untrue statement
or alleged untrue statement or omission or alleged omission arises out of or is
based upon a breach of the representations and warranties of the Seller set
forth in or made pursuant to Section 3; provided that the indemnification
provided by this Section 7 shall not apply to the extent that such untrue
statement or omission of a material fact was made as a result of an error in the
manipulation of, or in any calculations based upon, or in any aggregation of the
information regarding the FUNB Mortgage Loans, the related Mortgagors and/or the
related Mortgaged Properties set forth in the Data File and Annex A to the
Prospectus Supplement, including without limitation the aggregation of such
information with comparable information relating to the Other Mortgage Loans in
the Trust Fund. This indemnity agreement will be in addition to any liability
which the Seller may otherwise have.
(b) For purposes of this Agreement, "Registration Statement" shall
mean the registration statement No. 333-48943 filed by the Purchaser on Form
S-3, including without limitation exhibits thereto and information incorporated
therein by reference; "Prospectus" shall mean the prospectus dated May 11, 1998,
as supplemented by the prospectus supplement dated May 21, 1998 (the "Prospectus
Supplement"), relating to the Registered Certificates, including all annexes
thereto; "Memorandum" shall mean the private placement memorandum dated May 28,
1998, relating to the Non-Registered Certificates, including all exhibits
thereto; "Registered Certificates" shall mean the Class A-1, Class A-2, Class B,
Class C, Class D, Class E, and Class IO Certificates; "Non-Registered
Certificates" shall mean the Certificates other than the Registered
Certificates; "Computational Materials" shall have the meaning assigned thereto
in the no-action letter dated May 20, 1994 issued by the Division of Corporation
Finance of the Securities and Exchange Commission
<PAGE>
(the "Commission") to Kidder, Peabody Acceptance Corporation I, Kidder, Peabody
& Co. Incorporated, and Kidder Structured Asset Corporation and the no-action
letter dated May 27, 1994 issued by the Division of Corporation Finance of the
Commission to the Public Securities Association (together, the "Kidder
Letters"); "ABS Term Sheets shall have the meaning assigned thereto in the
no-action letter dated February 17, 1995 issued by the Division of Corporation
Finance of the Commission to the Public Securities Association (the "PSA Letter"
and, together with the Kidder letters, the "No-Action Letters"); "Diskette"
shall mean the diskette attached to each of the Prospectus and the Memorandum;
and "Data File" shall mean the compilation of information and data regarding the
Other Mortgage Loans and the Bank of America Mortgage Loans covered by the
Agreed Upon Procedures Letter dated May [ ], 1998 and rendered by Deloitte &
Touche LLP (a "hard copy" of which Data File was initialed on behalf of the
Seller and the Purchaser).
(c) Promptly after receipt by any person entitled to indemnification
under this Section 7 (an "indemnified party") of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against the Seller (the "indemnifying party") under this Section 7, notify
the indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party will not relieve it from any liability that
it may have to any indemnified party otherwise than under this Section 7. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein, and to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel selected by the indemnifying party and satisfactory to such
indemnified party; provided, however, that if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party or parties shall have reasonably concluded that there may be
legal defenses available to it or them and/or other indemnified parties that are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assert such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of its election so to
assume the defense of such action and approval by the indemnified party of
counsel, the indemnifying party will not be liable for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof, unless (i) the indemnified party shall have employed separate
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
<PAGE>
separate counsel, approved by the Purchaser and the Underwriters, representing
all the indemnified parties under Section 7(a) who are parties to such action),
(ii) the indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action or (iii) the indemnifying party has
authorized the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall only be in respect of the counsel referred to in such
clause (i) or (iii).
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under Section 7(a) hereof or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
the indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified and indemnifying parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by such parties.
(e) The Purchaser and the Seller agree that it would not be just and
equitable if contribution pursuant to Section 7(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the considerations referred to in Section 7(c) above. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in this Section 7 shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim, except where the indemnified party is required to bear such
expenses pursuant to this Section 7, which expenses the indemnifying party shall
pay as and when incurred, at the request of the indemnified party, to the extent
that the indemnifying party will be ultimately obligated to pay such expenses.
If any expenses so paid by the indemnifying party are subsequently determined to
not be required to be borne by the indemnifying party hereunder, the party that
received such payment shall promptly refund the amount so paid to the party
which made such payment. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
<PAGE>
(f) The indemnity and contribution agreements contained in this
Section 7 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by the Purchaser,
the Underwriters, any of their respective directors or officers, or any person
controlling the Purchaser or the Underwriters, and (iii) acceptance of and
payment for any of the Certificates.
(g) Without limiting the generality or applicability of any other
provision of this Agreement, the Underwriters shall be third-party beneficiaries
of the provisions of this Section 7.
SECTION 8. Costs. The Seller shall pay (or shall reimburse the Purchaser to the
extent that the Purchaser has paid) the Seller's pro rata portion of the
aggregate of the following amounts (the Seller's pro rata portion to be
determined according to the percentage that the FUNB Balance represents of the
Initial Pool Balance): (i) the costs and expenses of printing (or otherwise
reproducing) and delivering a preliminary and final Prospectus and Memorandum
relating to the Certificates; (ii) the initial fees, costs, and expenses of the
Trustee (including reasonable attorneys' fees); (iii) the filing fee charged by
the Securities and Exchange Commission for registration of the Certificates so
registered; (iv) the fees charged by the Rating Agencies to rate the
Certificates so rated; (v) the expense of recording any assignment of Mortgage
or assignment of Assignment of Leases as contemplated by Section 2 hereof; and
(vi) the cost of obtaining a "comfort letter" from a firm of certified public
accountants selected by the Purchaser and the Seller with respect to numerical
information in respect of the FUNB Mortgage Loans included in the Prospectus and
Memorandum. All other costs and expenses in connection with the transactions
contemplated hereunder shall be borne by the party incurring such expense.
SECTION 9. Grant of a Security Interest. It is the express intent of the parties
hereto that the conveyance of the FUNB Mortgage Loans by the Seller to the
Purchaser as provided in Section 2 hereof be, and be construed as, a sale of the
FUNB Mortgage Loans by the Seller to the Purchaser and not as a pledge of the
FUNB Mortgage Loans by the Seller to the Purchaser to secure a debt or other
obligation of the Seller. However, if, notwithstanding the aforementioned intent
of the parties, the FUNB Mortgage Loans are held to be property of the Seller,
then, (a) it is the express intent of the parties that such conveyance be deemed
a pledge of the FUNB Mortgage Loans by the Seller to the Purchaser to secure a
debt or other obligation of the Seller, and (b) (i) this Agreement shall also be
deemed to be a security agreement within the meaning of Articles 8 and 9 of the
Uniform Commercial Code of the applicable jurisdiction; (ii) the conveyance
provided for in Section 2 hereof shall be deemed to be a grant by the Seller to
the Purchaser of a security interest in all of the Seller's right, title and
interest in and to the FUNB Mortgage Loans, and all amounts payable to the
holder of the FUNB Mortgage Loans in accordance with the terms thereof, and all
<PAGE>
proceeds of the conversion, voluntary or involuntary, of the foregoing into
cash, instruments, securities or other property, including without limitation
all amounts, other than investment earnings, from time to time held or invested
in the Certificate Account, the Distribution Account or, if established, the REO
Account (each as defined in the Pooling and Servicing Agreement) whether in the
form of cash, instruments, securities or other property; (iii) the assignment to
the Trustee of the interest of the Purchaser as contemplated by Section 1 hereof
shall be deemed to be an assignment of any security interest created hereunder;
(iv) the possession by the Trustee or any of its agents, including, without
limitation, the Custodian, of the Mortgage 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 Uniform
Commercial Code of the applicable jurisdiction; and (v) notifications to persons
(other than the Trustee) holding such property, and acknowledgments, receipts or
confirmations from persons (other than the Trustee) holding such property, shall
be deemed notifications to, or acknowledgments, receipts or confirmations from,
financial intermediaries, bailees or agents (as applicable) of the secured party
for the purpose of perfecting such security interest under applicable law. The
Seller and the Purchaser shall, to the extent consistent with this Agreement,
take such actions as may be necessary to ensure that, if this Agreement were
deemed to create a security interest in the FUNB 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 and the Pooling and Servicing Agreement.
SECTION 10. Notices. All notices, copies, requests, consents, demands and other
communications required hereunder shall be in writing and telecopied or
delivered to the intended recipient at the "Address for Notices" specified
beneath its name on the signature pages hereof or, as to either party, at such
other address as shall be designated by such party in a notice hereunder to the
other party. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 11. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement,
incorporated herein by reference or contained in the certificates of officers of
the Seller submitted pursuant hereto, shall remain operative and in full force
and effect and shall survive delivery of the FUNB Mortgage Loans by the Seller
to the Purchaser (and by the Purchaser to the Trustee).
<PAGE>
SECTION 12. Severability of Provisions. Any part, provision, representation,
warranty or covenant of this Agreement that is prohibited or which is held to be
void or unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any part,
provision, representation, warranty or covenant of this Agreement that is
prohibited or unenforceable or is held to be void or unenforceable in any
particular jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by applicable law,
the parties hereto waive any provision of law which prohibits or renders void or
unenforceable any provision hereof.
SECTION 13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but which together shall
constitute one and the same agreement.
SECTION 14. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS
AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED IN ACCORDANCE WITH
THE INTERNAL LAWS AND DECISIONS OF NEW YORK. THE PARTIES HERETO INTEND THAT THE
PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY
TO THIS AGREEMENT.
SECTION 15. Further Assurances. The Seller and the Purchaser agree to execute
and deliver such instruments and take such further actions as the other party
may, from time to time, reasonably request in order to effectuate the purposes
and to carry out the terms of this Agreement.
SECTION 16. Successors and Assigns. The rights and obligations of the Seller
under this Agreement shall not be assigned by the Seller without the prior
written consent of the Purchaser, except that any person into which the Seller
may be merged or consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Seller is a party, or any person
succeeding to all or substantially all of the business of the Seller, shall be
the successor to the Seller hereunder. The Purchaser has the right to assign its
interest under this Agreement, in whole or in part, as may be required to effect
the purposes of the Pooling and Servicing Agreement, and the assignee shall, to
the extent of such assignment, succeed to the rights and obligations hereunder
of the Purchaser. Subject to the foregoing, this Agreement shall bind and inure
to the benefit of and be enforceable by the Seller, the Purchaser, the
Underwriters (as intended third party beneficiaries hereof) and their permitted
successors and assigns, and the officers, directors and controlling persons
referred to in Section 7. This Agreement is enforceable by the Underwriters and
the other third party
<PAGE>
beneficiaries hereto in all respects to the same extent as if they had been
signatories hereof.
SECTION 17. Amendments. No term or provision of this Agreement may be waived or
modified unless such waiver or modification is in writing and signed by a duly
authorized officer of the party, or third party beneficiary, against whom such
waiver or modification is sought to be enforced.
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective duly authorized officers as of the
date first above written.
SELLER
First Union National Bank
By:
----------------------------------
Name: Barry Reiner
Title: Senior Vice President
Address for Notices:
One First Union Center
301 South College Street
Attention: Barry Reiner
Telecopier No.: 383-9601
Telephone No.: 374-4499
PURCHASER
FIRST UNION COMMERCIAL
MORTGAGE SECURITIES, INC.
By:
----------------------------------
Name: Craig Lieberman
Title Vice President
Address for Notices:
One First Union Center
301 South College Street
Charlotte, North Carolina 28288-0600
Attention: Craig Lieberman
Telecopier No.: (704) 374-6435
Telephone No.: (704) 383-7407
<PAGE>
Exhibit A
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
First Union Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
5 First Union Plaza 999 Peachtree Street
6 Oakwood Village 185 Route 206
7 Phillips Place 6800 Fairview Road
11 The Ridge Gardens Apartments 8509 Old Harford Road
13 Peach Tree Apartments 2002-2042 Peach Orchard Drive
15 Hunt Club 404 Christopher Ave
16 100 West Chestnut St. 100 West Chestnut St.
18 Holly Hall 2111 Holly Hall Drive
21 Burke Centre Burke Centre Pkwy. & Rte. 123
23 Brinker Trust 11 Various
23a On The Border - Store #16 1121 I-20 West
23b Macaroni Grill - Store #131 5133 S. Padre Island Dr.
23c On The Border - Store #50 4301 S. Broadway
23d On The Border - Store #17 1890 S. Stemmon Frwy.
23e Chili's - Store #332 7621 F.M. 1960
23f Macaroni Grill - Store #37 1670 W. I-20
23g Chili's - Store #520 5025 E. 42nd St.
23h Chili's - Store #272 3710 Call Field Dr.
23i Chili's - Store #326 2800 Judson Rd.
24 Brinker Trust 9 6700-6750 LBJ Freeway
25 Quince Orchard I Apartments 805 Quince Orchard Blvd
28 Peachtree Walk 1074-1075 Peachtree Walk
31 Shaws Sainsbury 50 Boston Post Road
33 Consolidated Cap Care Properties (8) Various
33a Wynne Skilled 400 Arkansas Street
33b Marianna Highway 79 West
33c Forrest City Intermediate - 500 Kittle Road 500 Kittle Road
33d DeWitt 1325 Liberty Drive
33e Stuttgart West 20th Street
33f Forrest City Skilled - 603 Kittle Road 603 Kittle Road
33g Helena Skilled - 116 November 116 November Drive
33h Helena Intermediate - 111 Hospital 111 Hospital Drive
34 Stone Creek / Waters Landing 12840 Locbury Circle
36 Hechinger Commons Shopping Center 3101-3231 Duke Street
37 Steeplechase / Largo 150 Steeplechase Way
38 Sandy Springs Plaza 6221 - 6351 Roswell Road NE
39 The Plantation at Lafayette 211 Liberty Ave.
41 Woodholme Medical Building 1838 Greene Tree Road
48 Rose Hill II 4910-4926 Knickerbocker Drive
53 Quince Orchard II Apartments 805 Quince Orchard Blvd
55 Brinker Trust 5 0
55a Macaroni Grill - Store #106 780 Cobb Place Blvd.
55b On The Border - Store #24 8555 S. Quebec St.
55c Chili's - Store #364 3030 S. Glenstone
55d Chili's - Store #523 301 Constitution
55e Chili's - Store #256 2107 N. Veterans Pkwy.
55f Chili's - Store #421 3580 Broadway
56 Brinker Trust 7 Various
56a Macaroni Grill - Store #53 39300 Seven Mile Rd.
56b Macaroni Grill - Store #84 2572 Citiplace Court
56c On The Border - Store #40 8101 Giacosa Dr.
56d Chili's - Store #500 2319 Iowa St.
56e Chili's - Store #404 9610 Hwy 5
56f Chili's - Store #314 1388 Kildaire Farm Rd.
57 Northwind 1680 Sky Mountain Road
58 Brinker Trust 2 Various
58a Macaroni Grill - Store #50 11100 West Markham
58b Macaroni Grill - Store #115 740 SE Maynard Rd.
58c Chili's - Store #470 1706 E. Cheyenne Mountain Rd.
58d Chili's - Store #302 3795 E. Main St.
58e Chili's - Store # 309 9009 E. 71st Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
5 Atlanta GA 30309 64,000,000.00 415,102.78 6.7500 180 05/01/13
6 Mount Olive NJ 07836 63,766,163.27 441,378.01 7.3600 355 12/01/27
7 Charlotte NC 28200 25,328,344.54 165,094.21 6.7900 119 04/01/08
11 Baltimore MD 21234 22,168,011.77 149,609.90 7.1100 140 01/01/10
13 Falls Church VA 22043 21,172,007.68 146,423.13 7.3750 178 03/01/13
15 Gaithersburg MD 20879 20,806,341.65 135,991.59 6.8000 117 02/01/08
16 Chicago IL 60610 20,000,000.00 131,051.84 6.8500 120 05/01/08
18 Houston TX 77054 17,697,000.00 131,585.62 8.1400 110 07/01/07
21 Burke VA 22015 16,446,273.67 110,662.85 7.0800 176 01/01/13
23 Various TX Various 15,391,930.50 91,787.23 7.1560 234 11/01/17
23a Arlington TX 76017
23b Corpus Christie TX 78411
23c Tyler TX 75703
23d Lewisville TX 75067
23e Houston TX 77070
23f Arlington TX 76017
23g Odessa TX 79762
23h Witchita Falls TX 78603
23i Longview TX 75605
24 Dallas TX 75240 15,373,841.14 91,679.34 7.1560 234 11/01/17
25 Gaithersburg MD 20876 15,161,953.80 104,858.30 7.3750 178 03/01/13
28 Atlanta GA 30309 14,452,038.73 96,468.86 7.0000 116 01/01/08
31 Orange CT 44601 13,760,326.29 95,052.20 7.1250 297 02/01/23
33 Various AR Various 13,404,516.00 110,828.06 7.7500 236 01/01/18
33a Wynne AR 72396
33b Marianna AR 72342
33c Forrest City AR 72335
33d Dewitt AR 72042
33e Stuttggart AR 72160
33f Forrest City AR 72335
33g Helena AR 72342
33h Helena AR 72342
34 Germantown MD 20866 13,365,532.22 87,357.98 6.8000 117 02/01/08
36 Alexandria VA 22314 13,230,217.88 87,043.07 6.8750 154 03/01/11
37 Largo MD 20772 13,205,943.83 86,314.90 6.8000 117 02/01/08
38 Sandy Springs (Atlanta) GA 30328 13,189,312.81 88,374.69 7.0625 119 04/01/08
39 Lafayette LA 70508 12,750,000.00 89,499.33 7.5400 114 11/01/07
41 Baltimore MD 21208 12,443,167.58 90,924.24 7.6000 115 12/01/07
48 Alexandria VA 22310 11,980,750.16 80,846.22 7.1250 118 03/01/08
53 Gaithersburg MD 20878 10,979,483.59 75,932.83 7.3750 178 03/01/13
55 0 GA Various 10,671,795.87 63,639.47 7.1560 234 11/01/17
55a Kennesaw GA 30144
55b Highlands Ranch CO 80126
55c Springfield MO 65804
55d W. Monroe LA 71292
55e Bloomington IL 61704
55f Edmond OK 73013
56 Various MI Various 10,585,153.28 63,122.81 7.1560 234 11/01/17
56a Livonia MI 48152
56b Baton Rouge LA 70808
56c Memphis TN 38133
56d Lawrence KS 66046
56e Douglasville GA 30135
56f Cary NC 27511
57 Reno NV 89503 10,585,106.73 71,414.16 7.1250 118 03/01/08
58 Various AR Various 10,513,286.94 62,694.24 7.1560 234 11/01/17
58a Little Rock AR 72211
58b Cary NC 27511
58c Colorado Springs CO 80906
58d St. Charles IL 60174
58e Tulsa OK 74133
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
5 360 N 0.0900 0.0050 N - Act/360 First Union
6 N 0.0900 0.0050 N - Act/360 First Union
7 359 N 0.0900 0.0050 N - Act/360 First Union
11 356 N 0.0900 0.0050 N - 30/360 First Union
13 358 N 0.0900 0.0050 N - Act/360 First Union
15 357 N 0.0900 0.0050 N - 30/360 First Union
16 360 N 0.0900 0.0050 N - Act/360 First Union
18 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
21 356 N 0.0900 0.0050 N - Act/360 First Union
23 311 N 0.0900 0.0050 N - 30/360 First Union Y
23a N
23b N
23c N
23d N
23e N
23f N
23g N
23h N
23i N
24 311 N 0.0900 0.0050 N - 30/360 First Union Y
25 358 N 0.0900 0.0050 N - Act/360 First Union
28 356 N 0.0900 0.0050 N - Act/360 First Union
31 N 0.0900 0.0050 N - 30/360 First Union Y
33 N 0.0900 0.0050 N - Act/360 First Union
33a N
33b N
33c N
33d N
33e N
33f N
33g N
33h N
34 357 N 0.0900 0.0050 N - 30/360 First Union
36 358 N 0.0900 0.0050 N - Act/360 First Union
37 357 N 0.0900 0.0050 N - 30/360 First Union
38 359 N 0.0900 0.0050 N - Act/360 First Union
39 360 N 0.0900 0.0050 N - Act/360 First Union
41 319 N 0.0900 0.0050 N - Act/360 First Union
48 358 N 0.0900 0.0050 N - 30/360 First Union
53 358 N 0.0900 0.0050 N - Act/360 First Union
55 311 N 0.0900 0.0050 N - 30/360 First Union Y
55a N
55b N
55c N
55d N
55e N
55f N
56 311 N 0.0900 0.0050 N - 30/360 First Union Y
56a N
56b N
56c N
56d N
56e N
56f N
57 358 N 0.0900 0.0050 N - Act/360 First Union
58 311 N 0.0900 0.0050 N - 30/360 First Union Y
58a N
58b N
58c N
58d N
58e N
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
5 1.40 61.0 No Y Y
6 1.30 79.7 No Y Y
7 1.29 78.6 No Y Y
11 1.37 79.7 No N N
13 1.29 78.4 No N Y
15 1.21 79.6 No Y N
16 1.21 76.5 No N Y
18 1.22 80.4 No N N
21 1.51 66.6 No Y Y
23 Brinker International Y Y 1.00 99.8 No Y N
23a 0.00 0.0
23b 0.00 0.0
23c 0.00 0.0
23d 0.00 0.0
23e 0.00 0.0
23f 0.00 0.0
23g 0.00 0.0
23h 0.00 0.0
23i 0.00 0.0
24 Brinker International Y Y 1.00 100.1 No Y N
25 1.26 74.9 No N Y
28 1.26 72.3 No Y Y
31 J. Sainsbury PLC 1.00 99.0 No N N
33 2.00 55.4 No Y N
33a 0.00 0.0
33b 0.00 0.0
33c 0.00 0.0
33d 0.00 0.0
33e 0.00 0.0
33f 0.00 0.0
33g 0.00 0.0
33h 0.00 0.0
34 1.27 79.8 No Y N
36 1.43 71.9 No Y Y
37 1.30 79.8 No Y N
38 1.30 79.9 No Y Y
39 1.21 75.0 No N Y
41 1.40 71.5 No N N
48 1.26 79.9 No N N
53 1.25 74.9 No N Y
55 Brinker International Y Y 1.00 99.7 No Y N
55a 0.00 0.0
55b 0.00 0.0
55c 0.00 0.0
55d 0.00 0.0
55e 0.00 0.0
55f 0.00 0.0
56 Brinker International Y Y 1.00 99.8 No Y N
56a 0.00 0.0
56b 0.00 0.0
56c 0.00 0.0
56d 0.00 0.0
56e 0.00 0.0
56f 0.00 0.0
57 1.27 79.7 No Y Y
58 Brinker International Y Y 1.00 99.9 No Y N
58a 0.00 0.0
58b 0.00 0.0
58c 0.00 0.0
58d 0.00 0.0
58e 0.00 0.0
</TABLE>
B-20
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
First Union Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
58f Chili's - Store #329 1161 Old Salem Rd.
61 Old Farm 3751 Appian Way
62 River Reach 628 River Reach Dr.
64 Health Care South(6 Prop) Various
64a Toombs Nursing Home 181 Oxley Drive
64b Brentwood Terrace Health Center 115 Brentwood Drive
64c Lee County Health Care 214 Main Street
64d Liliann G. Carter Nursing Home 225 Hospital Street
64e Sparta Health Care Center Broad Street/Military Highway 22
64f Oconee Health Care Center 107 Ridgview Drive
65 Spinnaker Reach Apartments 3875 San Pablo Rd.
67 Eastland Plaza 678 North Wilson Way
68 Woodhaven Apartments 625 South Redwood Road
69 Best Western Greenfield Inn 3000 Enterprise Drive
71 Plaza LaFayette 13011 - 13051 Newport Avenue
72 The Broun Portfolio Consolidation Various
72a The Glen 148 Governors Court
72b The Mews Apartments 249 Meadows Drive
72c Meadowlark Apartments 101 Meadowlark Drive
76 Liberty Gardens 101 Liberty Garden Road
77 Park Forest 7529 Fleta
78 Kings Harbor Multicare Center 2000 East Gun Hill Road
82 Valley Manor 141C Marina Drive
84 The Morrison Building 6525 Morrison Boulevard
85 Sandstone Apartments 405 East Prince Road
90 Hampton Inn & Suites - Pineville 401 Towne Centre Boulevard
93 Claremont Retirement Village 7041 Bent Tree Blvd.
94 Brookside West Apartments 420 Berman Road
95 Harris Boulevard I 5100 West Harris Bouldevard
96 Scott Mountain by the Brook 7828 SE Aspen Summit Drive
99 North Point - Springhouse Phase I 5010 Split Rail Drive
105 Innsbrook Shoppes 4206 Cox Road
109 Montgomery Street 135 Montgomery Street
113 Trinity Place Apartments 1331 Trinity Place
121 Fountain Court 6355-6605 Manatee Avenue
126 The Addison 831 E. Morehead St.
127 Carolina Apartments 401 Highway 54 Bypass
128 Holiday Inn Lynchburg 601 Main Street
129 PalmTree Plaza 3513-3533 Canon Road
132 Franklin Plaza 281-339 Bickett Boulevard
133 Cumberland Green 26 Ladow Avenue
134 Spring Center 8627 16th Street
135 Rose Hill I 6200-6268 Rose Hill Drive
138 Green Grove 99 Green Grove
139 Constantine Village 26 Constantine Place
141 Shoppes of Olney 3110-3134 Olney Sandy Spring Road
142 United HealthCare Office Bldg 13621 NW 12th Street
146 540 Atlantic Avenue 540 Atlantic Avenue
147 Maple Leaf Plaza 540 Water Street
150 K & K Warehousing - 701 Fourth Avenue 701 Fourth Avenue
153 Mount Vernon 38-A Mount Vernon Drive
158 Leonardine Gardens 110 Leonardine Avenue
159 Kroger La Grange 203 Commerce Avenue
163 Hampton Inn Detroit Metro Airport 30847 Flynn Drive
166 Home - Springhouse Phase II 5010 Split Rail Drive
167 Southside Comfort Inn 120 West Third Street
168 Mill Park Apartments 2900 McCann Road
169 Warehouse Specialists - Enterprise Park 3.5, 4, 5 8511-8555 Martin Drive
170 Grand Central Station Shopping Center 8756 Research Blvd
171 Ramada Inn Newburgh 1055 Union Avenue
173 Beacon Mill Village 2 Main Street
175 La Maison 2308 & 2408 Houma Blvd
176 Connecticut Avenue Days Inn 4400 Connecticut Avenue, NW
177 Dill Creek Commons Shopping Center 1360 West Wade Hampton Blvd.
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
58f Conyers GA 30207
61 Lexington KY 40517 9,968,198.82 67,878.82 7.2000 116 01/01/08
62 Orlando FL 32828 9,932,082.23 69,128.75 7.4400 358 03/01/28
64 Various GA Various 9,717,397.08 81,666.44 7.9500 115 12/01/07
64a Lyons GA 30436
64b Waynesboro GA 30830
64c Leesburg GA 31763
64d Plains GA 31780
64e Sparta GA 31087
64f Oconee GA 31067
65 Jacksonville FL 32224 9,687,495.88 67,624.66 7.4700 358 03/01/28
67 Stockton CA 95202 9,565,038.58 66,304.81 7.3750 115 12/01/07
68 Salt Lake City UT 84104 9,530,000.00 70,860.08 8.1400 110 07/01/07
69 Allen Park MI 48101 9,265,237.21 67,761.23 7.3400 177 02/01/13
71 Tustin CA 92780 9,242,654.04 62,537.63 7.1600 155 04/01/11
72 Atlanta GA Various 9,237,003.50 62,318.96 7.1250 118 03/01/08
72a Cartersville GA 30120
72b Loganville GA 30249
72c McDonough GA 30253
76 Bergenfield NJ 07621 9,136,905.79 61,182.74 7.0500 118 03/01/08
77 St. Louis MO 63123 8,970,695.39 60,361.55 7.0800 176 01/01/13
78 Bronx NY 10469 8,951,209.01 74,664.64 7.8900 237 02/01/18
82 Edison NJ 08817 8,174,179.08 55,938.46 7.2500 176 01/01/13
84 Charlotte NC 28211 8,050,981.33 58,286.68 7.2000 115 12/01/07
85 Tuscon AZ 85705 7,983,000.00 59,357.40 8.1400 110 07/01/07
90 Pineville NC 28134 7,766,189.12 59,557.21 7.8750 116 01/01/08
93 Columbus OH 43235 7,589,517.39 51,587.90 7.2000 118 03/01/08
94 Augusta GA 30909 7,579,696.26 50,562.99 7.0000 117 02/01/08
95 Charlotte NC 28269 7,400,000.00 57,817.15 7.1000 240 05/01/18
96 Portland OR 97266 7,377,558.77 51,438.18 7.4400 116 01/01/08
99 Winston-Salem NC 27106 7,171,377.96 48,945.88 7.2150 115 12/01/07
105 Glen Allen VA 23060 7,000,000.00 48,228.05 7.3500 180 05/01/13
109 Jersey City NJ 07302 6,900,000.00 46,184.25 7.0600 360 05/01/28
113 Middletown OH 45042 6,794,491.45 45,514.91 7.0600 119 04/01/08
121 Bradenton FL 34209 6,592,324.44 48,238.06 7.3750 119 04/01/08
126 Charlotte NC 28204 6,555,555.55 48,773.42 7.5000 114 11/01/07
127 Carrboro NC 27510 6,547,029.36 45,320.04 7.3900 359 04/01/28
128 Lynchburg VA 24504 6,493,025.24 49,631.01 7.8750 119 04/01/08
129 Oceanside CA 92056 6,474,751.79 46,231.31 7.0700 297 02/01/23
132 Louisburg NC 27549 6,395,007.39 43,659.28 7.2500 239 04/01/18
133 Millville NJ 08332 6,381,293.31 45,298.80 7.6250 116 01/01/08
134 Silver Spring MD 20910 6,350,417.94 42,885.03 7.1100 175 12/01/12
135 Alexandria VA 22310 6,322,891.20 42,773.51 7.1500 118 03/01/08
138 Keyport NJ 07735 6,294,961.98 42,444.27 7.1250 179 04/01/13
139 Summit NJ 07836 6,276,579.44 43,105.37 7.2800 355 12/01/27
141 Olney MD 20832 6,244,629.40 40,578.93 6.7600 191 04/01/14
142 Sunrise FL 33304 6,200,000.00 45,013.94 7.3000 128 01/01/09
146 Brooklyn NY 11217 6,123,872.54 47,466.70 8.0000 116 01/01/08
147 Chardon OH 44024 6,077,175.58 41,612.75 7.2500 115 12/01/07
150 Menominee MI 49858 5,989,329.78 48,795.22 7.6250 119 04/01/08
153 Vernon CT 06066 5,982,462.46 42,467.63 7.6250 116 01/01/08
158 South River NJ 08882 5,784,398.59 38,431.86 6.9600 357 02/01/28
159 LaGrange GA 30241 5,774,542.54 42,557.86 7.3750 236 01/01/18
163 Romulus MI 48174 5,678,693.80 41,531.07 7.3400 177 02/01/13
166 Winston-Salem NC 27106 5,502,009.30 37,003.16 7.0750 116 01/01/08
167 Bethlehem PA 18018 5,493,855.16 41,092.76 7.6250 179 04/01/13
168 Longview TX 75605 5,486,000.00 40,791.02 8.1400 110 07/01/07
169 Clayton WI 54956 5,467,635.82 50,790.54 7.4375 178 03/01/13
170 Austin TX 78758 5,394,496.51 38,358.39 7.3750 116 01/01/08
171 Newburgh NY 12550 5,394,205.59 41,231.91 7.8750 119 04/01/08
173 Beacon Falls CT 06403 5,377,345.73 38,220.86 7.6250 354 11/01/27
175 Metairie LA 70001 5,355,527.84 35,336.83 6.9100 119 04/01/08
176 Washington DC 20008 5,350,000.00 39,536.03 7.5000 120 05/01/08
177 Greer SC 29650 5,349,731.63 42,764.71 7.3000 236 01/01/18
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
58f N
61 356 N 0.0900 0.0050 N - Act/360 First Union
62 N 0.0900 0.0050 N - Act/360 First Union
64 235 N 0.0900 0.0050 N - Act/360 First Union
64a N
64b N
64c N
64d N
64e N
64f N
65 N 0.0900 0.0050 N - Act/360 First Union
67 355 N 0.0900 0.0050 N - Act/360 First Union
68 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
69 297 N 0.0900 0.0050 N - Act/360 First Union
71 359 N 0.0900 0.0050 N - Act/360 First Union
72 358 N 0.0900 0.0050 N - Act/360 First Union
72a N
72b N
72c N
76 358 N 0.1150 0.0050 N - Act/360 First Union
77 356 N 0.0900 0.0050 N - 30/360 First Union
78 Y 0.0900 0.0050 N - Act/360 First Union
82 356 N 0.0900 0.0050 N - Act/360 First Union
84 295 N 0.0900 0.0050 N - 30/360 First Union
85 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
90 296 N 0.0900 0.0050 N - Act/360 First Union
93 358 N 0.0900 0.0050 N - Act/360 First Union
94 357 N 0.0900 0.0050 N - Act/360 First Union
95 N 0.0900 0.0050 N - Act/360 First Union
96 356 N 0.0900 0.0050 N - Act/360 First Union
99 355 N 0.0900 0.0050 N - 30/360 First Union
105 360 N 0.0900 0.0050 N - Act/360 First Union
109 N 0.0900 0.0050 N - Act/360 First Union
113 359 Y 0.0900 0.0050 N - 30/360 First Union
121 299 N 0.0900 0.0050 N - Act/360 First Union
126 294 N 0.0900 0.0050 N - Act/360 First Union
127 N 0.0900 0.0050 N - Act/360 First Union
128 299 N 0.0900 0.0050 N - Act/360 First Union
129 N 0.0900 0.0050 N - Act/360 First Union
132 359 N 0.0900 0.0050 N - Act/360 First Union
133 356 N 0.0900 0.0050 N - Act/360 First Union
134 355 N 0.0900 0.0050 N - Act/360 First Union
135 358 N 0.0900 0.0050 N - 30/360 First Union
138 359 N 0.0900 0.0050 N - Act/360 First Union
139 N 0.0900 0.0050 N - Act/360 First Union
141 359 N 0.0900 0.0050 N - Act/360 First Union
142 300 N 0.0900 0.0050 N - Act/360 First Union
146 296 N 0.0900 0.0050 N - Act/360 First Union
147 355 N 0.0900 0.0050 N - Act/360 First Union
150 239 N 0.0900 0.0050 N - Act/360 First Union
153 356 N 0.0900 0.0050 N - Act/360 First Union
158 N 0.0900 0.0050 N - Act/360 First Union
159 293 N 0.0900 0.0050 N - 30/360 First Union Y
163 297 N 0.0900 0.0050 N - Act/360 First Union
166 356 N 0.0900 0.0050 N - 30/360 First Union
167 299 N 0.0900 0.0050 N - Act/360 First Union
168 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
169 N 0.0900 0.0050 N - Act/360 First Union
170 326 N 0.0900 0.0050 N - Act/360 First Union
171 299 N 0.0900 0.0050 N - Act/360 First Union
173 N 0.0900 0.0050 N - Act/360 First Union
175 359 N 0.0900 0.0050 N - Act/360 First Union
176 300 Both 0.0900 0.0050 N - Act/360 First Union
177 N 0.0900 0.0050 N - Act/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
58f 0.00 0.0
61 1.31 79.8 No Y Y
62 1.26 84.9 No N Y
64 1.71 60.3 No Y N
64a 0.00 0.0
64b 0.00 0.0
64c 0.00 0.0
64d 0.00 0.0
64e 0.00 0.0
64f 0.00 0.0
65 1.21 83.5 No N Y
67 1.26 79.7 No Y Y
68 1.26 73.3 No N N
69 1.40 64.3 No Y Y
71 1.26 73.9 No Y Y
72 1.50 79.5 No N Y
72a 0.00 0.0
72b 0.00 0.0
72c 0.00 0.0
76 1.33 79.8 No Y Y
77 1.41 70.4 No N N
78 2.33 20.8 No Y N
82 1.25 79.4 No N Y
84 1.68 64.9 No N N
85 1.19 79.8 No N N
90 1.38 74.5 Panos Y N
93 1.64 69.0 No Y Y
94 1.30 75.8 No N Y
95 1.26 71.7 No N Y
96 1.25 78.5 No N Y
99 1.29 79.7 No N N
105 1.35 74.9 No Y Y
109 1.26 49.3 No Y Y
113 1.33 80.9 No Y N
121 1.27 74.9 No Y Y
126 1.25 76.5 No N Y
127 1.26 77.9 No Y Y
128 1.50 58.5 No Y N
129 1.39 71.9 No Y Y
132 1.25 79.9 No Y Y
133 1.30 70.9 No N N
134 1.41 74.7 No Y Y
135 1.26 74.4 No Y N
138 1.22 79.7 No N Y
139 1.68 67.9 No Y Y
141 1.45 68.6 No Y Y
142 1.54 50.0 No Y Y
146 1.42 69.0 No Y N
147 1.30 76.0 No N Y
150 1.45 69.4 K&K Y N
153 1.52 63.0 No N N
158 1.27 79.8 No N Y
159 Kroger Company Y Y 1.02 95.5 No Y N
163 1.44 64.5 No Y Y
166 1.36 79.7 No N N
167 1.54 74.2 No Y N
168 1.25 78.4 No N N
169 1.27 63.6 WSI II Y Y
170 1.26 74.4 No N Y
171 1.40 69.6 No Y N
173 1.50 71.7 No N N
175 1.49 79.9 No Y Y
176 1.51 70.9 No Y Y
177 1.29 74.4 No Y Y
</TABLE>
B-21
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
First Union Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
180 Hampton Inn - Matthews 9615 Independence Point Parkway
181 Cambridge House 250 Bellbrook Avenue
184 Hearthside 8214 Wilson Drive
185 Hampton Inn - Concord 612 Dicken Place
186 Reddmans Pier Apartments 5826 Reddman Road
189 Kroger Huntsville 8404 South Memorial Parkway
192 Kelly House 106 St. Philip Street
195 Hampton Inn - Gatlinburg, TN 967 Parkway
197 Agoura Hills Town Center 30105-30135 Agoura Road
198 Foxhill Apartments 1900 South Missouri Street
203 K&K Warehousing - 3100 Woleske Rd 3100 Woleske Road
206 Villa Park I 8040 Villa Park Drive
211 Fairfield Inn Shreveport 6245 Westport Avenue
213 Oxford Point 106 Old Lincoln Highway
218 Sunnyview 4502 Sunnyview Drive
222 Seminary Place Shopping Center 9440-9524 Georgia Avenue
223 Vernon Gardens 695 Talcottville Road
228 Ramada Inn & Suites 1410 South Country Club Drive
238 Hunters Crossing 2801 Bill Owens Parkway
239 54-57 South Street 54-57 South Street
240 Hansen Village Apartments 11821 Foothill Boulevard
244 Milestone Hopewell Road
246 Arnold Industrial Park 1361 Airport Road North
247 Derby Ridge 67 Blue Stone Court
250 Superstition Marketplace 1155 South Power Road
251 Blue Grass Plaza 2417 Welsh Road (PA 532)
254 Village Green 1000-1013 Village Green, 1005-1013 Milan Drive
255 Spartan Square Shopping Center 1435-1499 W. Main St.
256 Winn Dixie Eustis 1951 State Road 19 North
261 Winn Dixie Orangeburg 1481 Chestnut Street
270 Village South 1243 Bay Area Blvd
275 Covington Square 4828 Zenith Street
278 Grand Manor Nursing and Rehab Center 3645 Cook Avenue
280 Hillsdale Manor 4710-4738 Wakefield Road
281 Amerihost Inn- Players 203 Front Street
283 Metro Plaza 1407-1411 East-West Hgwy & 8397-8399 Colesville Rd
286 Forestwood On the Creek Apts. 9601 Forest Lane
288 Westbrook 3463-3560 53rd Ave
290 Staples Hazelton 180 Susquehanna Boulevard
291 Treetops Terace Condominiums 93-116 Tree Top Court
292 Estero Woods Village 22770 South Tamiami Trail
294 Warehouse Specialists - Fond Du Lac II 170 W. Larsen Drive
297 Buck Run/Timberline Condominiums 4689 Buck Run Square
299 Mooresmill Village 2453 Coronet Way, NE
305 2-32 Brighton & 1101-1113 Commonwealth 2-32 Brighton & 1101-1113 Commonwealth
308 South Brook 5101 Linbar Drive
311 Pinnacle 7131 Pinnacle Drive
313 Access Self Storage of Wayne 575 Route 23
315 Winn Dixie Morganton 111 Independence Boulevard
318 Grandview 1319 E. 45th Street
320 Pep Boys Union 2525 U.S. Highway 22
321 9031 Snowden Square Drive 9031 Snowden Square Drive
332 Safeway Milton Freewater 455 North Columbia St.
333 Rite Aid Portage Westnedge Avenue and Kilgore Road
340 Walgreen St John 9280 Wicker Avenue
342 Chancellor Care Center of Delmar 101 E. Delaware Avenue
345 Walgreen Lafayette SEC 18TH Street and State Road 26
346 Northfield Lodge 603 East Northfield Boulevard
348 Somserset Chambers 156-158 Summer Street
349 Village Plaza of Margate 1360-1456 N. State Rd. 7
351 Pheasant Glen 447 West Clinton Avenue
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
180 Matthews NC 28105 5,277,025.94 40,468.36 7.8750 116 01/01/08
181 Bristol TN 37620 5,271,218.92 43,919.90 7.8750 237 02/01/18
184 Ralston NE 68127 5,120,000.00 33,634.76 6.8750 120 05/01/08
185 Concord NC 28025 5,077,892.90 38,941.25 7.8750 116 01/01/08
186 Charlotte NC 28212 5,019,965.16 34,262.12 7.2150 115 12/01/07
189 Huntsville AL 35801 4,987,105.52 36,799.57 7.3750 236 01/01/18
192 Charleston SC 29403 4,907,580.45 32,343.91 6.8800 117 02/01/08
195 Gatlinburg TN 37738 4,865,111.39 36,423.12 7.6250 118 03/01/08
197 Agoura Hills CA 91301 4,850,614.46 36,169.49 7.8750 114 11/01/07
198 Casper WY 82609 4,787,972.59 33,152.41 7.3750 117 02/01/08
203 Marinette WI 54153 4,591,819.50 37,409.67 7.6250 119 04/01/08
206 Richmond VA 23228 4,573,974.74 34,368.49 7.6250 175 12/01/12
211 Shreveport LA 71129 4,483,464.26 33,137.61 7.4600 117 02/01/08
213 Falls Township PA 19030 4,479,383.97 34,209.10 8.1300 114 11/01/07
218 Oklahoma City OK 73135 4,356,682.39 30,113.44 7.3750 119 04/01/08
222 Silver Spring MD 20901 4,191,649.51 31,835.49 6.7100 239 04/01/18
223 Vernon CT 06066 4,188,585.76 27,661.21 6.9000 177 02/01/13
228 Mesa AZ 85210 4,145,337.26 30,911.49 7.5900 239 04/01/18
238 Longview TX 75605 4,076,595.82 26,898.18 6.9100 119 04/01/08
239 Morristown NJ 07016 4,000,000.00 29,235.19 7.3750 120 05/01/08
240 Lake View Terrace CA 91342 3,996,904.34 27,395.66 7.2900 119 04/01/08
244 Williamsport MD 21795 3,956,704.30 29,374.90 7.5000 296 01/01/23
246 Naples FL 34104 3,925,345.74 28,796.66 7.3750 117 02/01/08
247 Lakeside Park KY 41017 3,888,336.27 27,296.08 7.5100 116 01/01/08
250 Mesa AZ 85206 3,800,000.00 26,453.96 7.2500 177 02/01/13
251 Philadelphia PA 19114 3,793,244.60 26,226.90 7.1000 118 03/01/08
254 Norfolk NE 68701 3,787,735.69 25,601.30 7.1250 116 01/01/08
255 Salem VA 24523 3,785,732.36 29,006.90 6.8000 238 03/01/18
256 Eustis FL 32726 3,781,369.71 29,851.29 7.0300 232 09/01/17
261 Orangeburg SC 29115 3,614,562.16 26,554.05 7.2600 228 05/01/17
270 Clear Lake City TX 77058 3,577,012.99 23,601.84 6.9100 119 04/01/08
275 Metairie LA 70001 3,477,096.43 22,942.57 6.9100 119 04/01/08
278 St Louis MO 63113 3,435,045.19 26,342.61 7.8750 176 01/01/13
280 Baltimore MD 21207 3,426,847.77 23,339.63 7.2100 117 02/01/08
281 Metroplois IL 62960 3,419,679.83 28,057.25 7.6250 235 12/01/17
283 Silver Spring MD 20910 3,394,966.40 22,415.15 6.9100 178 03/01/13
286 Dallas TX 75243 3,389,912.30 23,889.81 7.5500 116 01/01/08
288 Columbus NE 68601 3,385,039.59 22,879.48 7.1250 116 01/01/08
290 West Hazelton PA 18201 3,361,990.84 27,437.69 7.6000 237 02/01/18
291 Blommingdale NJ 07403 3,350,000.00 22,852.91 7.2500 180 05/01/13
292 Estero FL 33928 3,349,272.58 22,761.81 7.1800 80 01/01/05
294 Fond Du Lac WI 54935 3,330,287.28 30,936.05 7.4375 178 03/01/13
297 Roanoke VA 24014 3,295,363.42 22,232.71 7.1250 118 03/01/08
299 Atlanta GA 30318 3,291,194.91 27,834.85 9.0625 297 02/01/23
305 Boston MA 02215 3,246,220.37 23,753.59 7.3750 119 04/01/08
308 Nashville TN 37211 3,213,139.91 22,175.45 7.3300 175 12/01/12
311 Ft. Myers FL 33907 3,191,724.41 21,699.56 7.1900 117 02/01/08
313 Wayne Township NJ 07470 3,188,308.05 23,647.72 7.5000 117 02/01/08
315 Morganton NC 28655 3,154,360.17 24,999.29 7.0000 229 06/01/17
318 Kearny NE 68847 3,143,820.62 21,249.08 7.1250 116 01/01/08
320 Union Township NJ 07083 3,124,248.80 22,684.52 7.4100 234 11/01/17
321 Columbia MD 21045 3,117,577.56 26,103.34 7.8750 234 11/01/17
332 Milton Freewater OR 98762 3,022,231.31 23,478.58 7.2500 231 08/01/17
333 Portage MI 49081 3,010,493.00 22,542.69 7.1250 236 01/01/18
340 St. John IN 46373 2,960,504.00 23,177.84 7.0000 235 12/01/17
342 Delmar DE 19940 2,944,904.07 22,845.76 8.0000 115 12/01/07
345 Lafayette IN 47905 2,922,389.00 22,526.56 6.8750 238 03/01/18
346 Murfreesboro TN 37130 2,897,305.71 19,995.72 7.3300 175 12/01/12
348 Summerville MA 02143 2,876,550.45 20,705.64 7.1900 299 04/01/23
349 Margate FL 33063 2,843,054.28 24,758.22 7.5000 203 04/01/15
351 State College PA 16803 2,815,365.88 22,099.99 8.7000 296 01/01/23
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
180 296 N 0.0900 0.0050 N - Act/360 First Union
181 N 0.0900 0.0050 N - Act/360 First Union
184 360 N 0.0900 0.0050 N - Act/360 First Union
185 296 N 0.0900 0.0050 N - Act/360 First Union
186 355 N 0.0900 0.0050 N - 30/360 First Union
189 292 N 0.0900 0.0050 N - 30/360 First Union Y
192 357 Both 0.0900 0.0050 N - Act/360 First Union
195 298 N 0.0900 0.0050 N - Act/360 First Union
197 324 N 0.0900 0.0050 N - Act/360 First Union
198 357 N 0.0900 0.0050 N - Act/360 First Union
203 239 N 0.0900 0.0050 N - Act/360 First Union
206 295 N 0.0900 0.0050 N - 30/360 First Union
211 297 N 0.0900 0.0050 N - Act/360 First Union
213 321 N 0.0900 0.0050 N - Act/360 First Union
218 359 N 0.0900 0.0050 N - Act/360 First Union
222 N 0.0900 0.0050 N - Act/360 First Union
223 357 N 0.0900 0.0050 N - Act/360 First Union
228 299 N 0.0900 0.0050 N - Act/360 First Union
238 359 N 0.0900 0.0050 N - Act/360 First Union
239 300 N 0.0900 0.0050 N - Act/360 First Union
240 359 N 0.0900 0.0050 N - Act/360 First Union
244 N 0.1150 0.0050 N - Act/360 First Union
246 297 N 0.0900 0.0050 N - Act/360 First Union
247 356 N 0.0900 0.0050 N - Act/360 First Union
250 336 N 0.0900 0.0050 N - Act/360 First Union
251 328 N 0.1150 0.0050 N - Act/360 First Union
254 356 N 0.0900 0.0050 N - Act/360 First Union
255 N 0.0900 0.0050 N - Act/360 First Union
256 N 0.0900 0.0050 N - 30/360 First Union Y
261 288 N 0.0900 0.0050 N - 30/360 First Union Y
270 359 N 0.0900 0.0050 N - Act/360 First Union
275 359 N 0.0900 0.0050 N - Act/360 First Union
278 296 N 0.0900 0.0050 N - Act/360 First Union
280 357 N 0.0900 0.0050 N - 30/360 First Union
281 N 0.0900 0.0050 N - Act/360 First Union
283 358 N 0.0900 0.0050 N - Act/360 First Union
286 356 N 0.0900 0.0050 N - Act/360 First Union
288 356 N 0.0900 0.0050 N - Act/360 First Union
290 N 0.0900 0.0050 N - 30/360 First Union Y
291 360 N 0.0900 0.0050 N - Act/360 First Union
292 356 N 0.0900 0.0050 N - Act/360 First Union
294 N 0.0900 0.0050 N - Act/360 First Union
297 358 N 0.0900 0.0050 N - Act/360 First Union
299 N 0.0900 0.0050 N - 30/360 First Union
305 299 N 0.0900 0.0050 N - Act/360 First Union
308 355 N 0.0900 0.0050 N - Act/360 First Union
311 357 N 0.0900 0.0050 N - Act/360 First Union
313 297 N 0.0900 0.0050 N - Act/360 First Union
315 N 0.0900 0.0050 N - 30/360 First Union Y
318 356 N 0.0900 0.0050 N - Act/360 First Union
320 N 0.0900 0.0050 N - 30/360 First Union Y
321 N 0.0900 0.0050 N - Act/360 First Union
332 N 0.0900 0.0050 N - 30/360 First Union Y
333 266 N 0.0900 0.0050 N - 30/360 First Union Y
340 N 0.0900 0.0050 N - 30/360 First Union Y
342 295 N 0.0900 0.0050 N - Act/360 First Union
345 N 0.0900 0.0050 N - 30/360 First Union Y
346 355 N 0.0900 0.0050 N - Act/360 First Union
348 N 0.0900 0.0050 N - 30/360 First Union
349 N 0.0900 0.0050 N - Act/360 First Union
351 356 N 0.0900 0.0050 N - Act/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
180 1.52 74.6 Panos Y N
181 1.37 78.7 No Y N
184 1.31 80.0 No Y Y
185 1.40 73.6 Panos Y N
186 1.26 79.7 No N N
189 Kroger Company Y Y 1.02 94.1 No Y N
192 1.32 77.3 No N Y
195 1.44 74.9 No Y N
197 1.39 74.6 No Y N
198 1.29 73.7 No N Y
203 1.44 76.4 K&K Y N
206 1.32 65.8 No Y N
211 1.41 69.0 No Y Y
213 1.34 72.8 No Y N
218 1.34 79.9 No Y Y
222 1.55 55.9 No Y Y
223 1.25 76.2 No Y Y
228 1.40 75.9 Inn of Pays Y Y
238 1.26 79.9 No Y Y
239 1.57 63.5 No Y Y
240 1.26 66.6 No Y Y
244 1.32 74.7 No N Y
246 1.35 56.1 No Y Y
247 1.32 69.2 No N Y
250 1.46 58.0 No Y Y
251 1.28 71.6 No Y Y
254 1.57 80.6 No Y Y
255 1.65 64.6 No Y Y
256 Winn-Dixie Stores, Inc. 1.03 86.4 No Y N
261 Winn-Dixie Stores, Inc. Y Y 1.03 95.1 No Y N
270 1.35 79.9 No Y Y
275 1.35 79.9 No Y Y
278 1.98 74.7 No Y N
280 1.25 74.8 No N N
281 1.40 68.4 No Y N
283 1.50 73.6 No Y Y
286 1.27 70.6 No Y Y
288 1.47 80.6 No Y Y
290 Staples 1.00 96.1 No N N
291 1.29 79.8 No Y Y
292 1.40 79.7 No N Y
294 1.35 62.8 WSI II Y Y
297 1.30 76.6 No Y Y
299 1.20 75.3 No N N
305 1.30 61.3 No Y Y
308 1.79 49.4 No N Y
311 1.40 79.1 No N Y
313 1.82 65.1 No Y Y
315 Winn-Dixie Stores, Inc. 1.04 90.1 No Y N
318 1.44 80.6 No Y Y
320 Pep Boys 1.04 99.5 No N N
321 1.28 69.3 No N N
332 Safeway 1.05 94.4 No Y N
333 Rite Aid Corp. Y Y 1.00 97.1 No Y N
340 Walgreen Company 1.00 93.2 No Y N
342 1.45 68.5 No Y N
345 Walgreen Company 1.08 87.5 No Y N
346 1.30 66.6 No N Y
348 1.26 79.9 No N N
349 1.26 71.1 No Y Y
351 1.18 84.8 No Y N
</TABLE>
B-22
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
First Union Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
354 Old Country Plaza 3940 Plank Road Road
356 Walgreen Miami 9675 Northwest 41st Street
360 Warehouse Specialists - Stevens Point I & II 4400 Industrial Park Rd. & 2557 Leahy Court
362 Littleton Lyne 119-125 Littleton Road
364 Auburn Blvd Mini Storage 6230 Auburn Blvd
365 Springs Office Building 2101 West State Road 434
373 Linda Granada 16600 San Fernanado Mission
374 633 Building 633 Germantown Pike
375 Shoreline View Alzheimer Care Center 9324 North Harborview Drive
377 Cobblestone Village 1237-1263 North Riverside Av.
381 Amerihost Inn - Hammond 7813 Indianapolis Boulevard
382 Holiday Inn Express - Albany, GA 911 East Oglethorpe Blvd.
385 Southgate Village Life Care Center 4101 SW Martin Drive
386 Walgreen Houston 10850 Scarsdale Boulevard
387 Kushner Seiden Madison 64th LP 26 East 64th Street
389 Stor-It Rental Storage 1435 Malad Street
391 Best Western - Dunn 603 Spring Branch Road
394 Safeguard Self Storage 1007-09 Edgewood Road
395 Tuscany Village Phase I 235 Ocala
396 Concord Village West 137-A West Concord Drive
398 Days Inn - Forest Park 5116 Highway 85
399 Tech Center 300 Kimberton Road
400 Amerihost Inn - Parkersburg 401 37th Street
401 Comfort Inn - Gaffney, SC 143 Corona Drive
402 Food Pavilion 1000 West 4th Avenue
404 Keep It Self Storage - Santa Clarita 25333 San Fernando Road
405 Country Creek 398 Bethel Avenue
407 Willow Trace Apartments 8100 Pines Road
408 Walgreen Coral Springs 5480 University Drive
409 Fox Crossing 6410 Walther Avenue
410 Emmorton Village Shopping Center 3101-05 Emmorton Road (Rt. 24)
412 Walgreen Chicago 1546 North Central Ave.
413 Warehouse Specialists - Specialists Ave # 1-4 720 - 772 Specialists Avenue
415 Inn of Payson 801 North Beeline Highway
417 Val Halla 1224 Lake Avenue
421 Plantation House 2625 Hudnell Street
424 Comfort Inn - Franklin 4206 Franklin Commons Court
426 Office Depot Aurora SEC East Mississippi Avenue & South Potomac Street
430 1212-1216 Broadway 1212-1216 Broadway
433 Eckerd Ventnor 6701 Ventnor Avenue
437 Rite Aid Virginia Beach 324 Virginia Beach Blvd
438 Rite Aid Roanoke 1168 Peters Creek Road
439 The Business Centre at Riverside 1362 Brass Mill Road
440 The Manors Apartments 985 Manor Drive
442 Eckerd Houma 7015 West Park Avenue
443 Antelope Valley Mall 1201 W Avenue P
444 Chateau Imperial 3000-3320 Parklane Drive
447 Eckerd Winslow S.W. Willaimstown - New Freedom Road
452 Villa d'Venus 3124 Lake Villa Drive
453 Eckerd Drugs State Route 211 and Blumel Road
456 Best Western St. Augustine 2445 State Road 16
457 Nalley Valley Self Storage 2201 S. Tacoma Way
461 Days Inn/Kingsland 1050 East King Avenue
462 P Street 1743 P Street
465 Woodway Apartments 2895 Dorthy Jeanie Drive
467 Eckerd Wildwood 4201 Atlantic Ave.
470 Best Western Statesville 1121 Morland Drive
477 155 North Beacon Street 155 North Beacon Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
354 Fredericksburg VA 22407 2,778,954.47 22,130.53 7.2500 236 01/01/18
356 Miami FL 33178 2,718,069.24 22,627.10 7.5000 223 12/01/16
360 Stevens Point WI 54481 2,684,112.12 24,933.54 7.4375 178 03/01/13
362 Ayer MA 01432 2,656,383.08 20,607.49 8.0000 115 12/01/07
364 Citrus Heights CA 95621 2,639,793.95 18,949.99 7.1300 117 02/01/08
365 Altomonta Springs/Longwood FL 32714 2,639,786.71 18,941.49 7.1250 117 02/01/08
373 Granda Hills CA 91344 2,542,686.75 18,215.68 7.7200 116 01/01/08
374 Plymouth Meeting PA 19401 2,540,682.96 18,844.28 7.5000 117 02/01/08
375 Gig Harbor WA 98332 2,538,946.43 19,470.63 7.8750 116 01/01/08
377 Medford OR 97501 2,500,000.00 17,054.41 7.2500 120 05/01/08
381 Hammond IN 46324 2,481,770.36 20,139.83 7.5000 236 01/01/18
382 Albany GA 31705 2,479,063.65 20,911.00 8.0000 235 12/01/17
385 Topeka KS 66612 2,464,054.16 18,694.39 7.7500 116 01/01/08
386 Houston TX 77089 2,459,764.86 19,656.00 7.2700 235 12/01/17
387 New York NY 10021 2,453,681.46 16,748.18 7.2300 357 02/01/28
389 Boise ID 83705 2,447,179.29 18,783.43 7.8750 175 12/01/12
391 Dunn NC 28334 2,416,635.89 24,305.97 8.6250 175 12/01/12
394 Edgewood MD 21040 2,394,644.70 16,814.03 7.5200 117 02/01/08
395 Tallahassee FL 32304 2,392,627.30 16,576.20 7.3750 116 01/01/08
396 Clarksvile TN 37042 2,391,173.89 16,502.66 7.3300 175 12/01/12
398 Forest Park GA 30050 2,382,514.19 20,710.39 8.8750 114 11/01/07
399 Phoenixville PA 19460 2,382,499.53 19,334.24 7.5000 116 01/01/08
400 Parkersburg WV 26101 2,378,907.69 19,518.09 7.6250 235 12/01/17
401 Gaffney SC 29341 2,360,068.62 19,907.27 8.0000 235 12/01/17
402 Kennewick WA 99336 2,343,111.70 15,743.34 7.0900 119 04/01/08
404 Santa Clarita CA 91350 2,339,388.61 17,550.14 7.6200 236 01/01/18
405 Sanger CA 93757 2,326,171.64 16,721.06 7.7500 175 12/01/12
407 Shreveport LA 71129 2,322,000.00 17,265.18 8.1400 110 07/01/07
408 Coral Springs FL 33076 2,320,085.38 18,521.79 7.1250 230 07/01/17
409 Baltimore MD 21206 2,319,272.57 15,499.53 7.0200 117 02/01/08
410 Abingdon MD 21009 2,291,829.34 16,698.72 7.3000 117 02/01/08
412 Chicago IL 60639 2,261,719.41 17,671.97 7.0000 236 01/01/18
413 Menasha WI 54956 2,261,613.00 21,008.81 7.4375 178 03/01/13
415 Payson AZ 85541 2,247,472.01 16,759.24 7.5900 239 04/01/18
417 Metairie LA 70002 2,222,177.00 14,796.33 7.0000 119 04/01/08
421 Dallas TX 75235 2,200,000.00 16,358.05 8.1400 110 07/01/07
424 Franklin TN 37064 2,196,876.93 17,560.57 7.8750 179 04/01/13
426 Aurora CO 80012 2,194,462.46 19,361.62 7.6250 173 10/01/12
430 New York NY 10001 2,189,021.81 17,162.53 8.1250 115 12/01/07
433 Ventnor City NJ 08408 2,167,394.14 15,565.49 7.3100 233 10/01/17
437 Virginia Beach VA 23451 2,149,999.09 17,186.93 7.1700 231 08/01/17
438 Roanoke VA 24017 2,145,860.84 16,985.41 7.1700 236 01/01/18
439 Belcamp MD 21017 2,145,240.02 15,121.54 7.5600 117 02/01/08
440 Palm Springs FL 33461 2,142,586.73 15,217.57 7.6250 115 12/01/07
442 Houma LA 70364 2,126,984.61 15,030.92 7.0900 233 10/01/17
443 Palmdale CA 93551 2,125,000.00 16,744.03 7.2100 120 05/01/08
444 Hastings NE 68901 2,120,000.00 13,926.89 6.8750 120 05/01/08
447 Winslow Township NJ 08095 2,106,916.60 15,577.28 7.6900 234 11/01/17
452 Metairie LA 70002 2,098,247.85 13,844.65 6.9100 119 04/01/08
453 Wallkill NY 10941 2,098,030.42 14,875.83 7.3750 119 04/01/08
456 St. Augustine FL 32092 2,096,489.79 17,728.96 8.1250 239 04/01/18
457 Tacoma WA 98409 2,095,512.36 15,314.50 7.3500 238 03/01/18
461 Kingsland GA 31548 2,093,196.67 17,402.23 7.8750 238 03/01/18
462 Washington DC 20036 2,092,352.17 14,504.18 7.3750 115 12/01/07
465 Fayetteville AR 72704 2,078,377.40 14,189.27 7.2500 119 04/01/08
467 Wildwood NJ 08260 2,072,762.95 16,094.97 7.6900 236 01/01/18
470 Statesville NC 28677 2,051,019.67 20,330.46 8.3750 175 12/01/12
477 Brighton MA 02135 1,993,519.50 15,271.08 7.8750 81 02/01/05
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
354 N 0.0900 0.0050 N - Act/360 First Union
356 N 0.0900 0.0050 N - 30/360 First Union Y
360 N 0.0900 0.0050 N - Act/360 First Union
362 295 N 0.0900 0.0050 N - Act/360 First Union
364 297 N 0.0900 0.0050 N - Act/360 First Union
365 297 Y 0.0900 0.0050 N - Act/360 First Union
373 356 N 0.0900 0.0050 N - Act/360 First Union
374 297 N 0.0900 0.0050 N - Act/360 First Union
375 296 N 0.0900 0.0050 N - Act/360 First Union
377 360 N 0.0900 0.0050 N - Act/360 First Union
381 N 0.0900 0.0050 N - Act/360 First Union
382 N 0.0900 0.0050 N - Act/360 First Union
385 296 N 0.1150 0.0050 N - Act/360 First Union
386 N 0.0900 0.0050 N - 30/360 First Union Y
387 N 0.0900 0.0050 N - Act/360 First Union
389 295 N 0.0900 0.0050 N - Act/360 First Union
391 Y 0.0900 0.0050 N - Act/360 First Union
394 357 N 0.0900 0.0050 N - 30/360 First Union
395 356 N 0.0900 0.0050 N - Act/360 First Union
396 355 N 0.0900 0.0050 N - Act/360 First Union
398 258 N 0.0900 0.0050 N - Act/360 First Union
399 236 N 0.0900 0.0050 N - Act/360 First Union
400 N 0.0900 0.0050 N - Act/360 First Union
401 N 0.0900 0.0050 N - Act/360 First Union
402 359 N 0.0900 0.0050 N - Act/360 First Union
404 296 N 0.0900 0.0050 N - Act/360 First Union
405 355 N 0.0900 0.0050 N - Act/360 First Union
407 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
408 N 0.0900 0.0050 N - 30/360 First Union Y
409 357 N 0.0900 0.0050 N - 30/360 First Union
410 297 N 0.0900 0.0050 N - 30/360 First Union
412 N 0.0900 0.0050 N - 30/360 First Union Y
413 N 0.0900 0.0050 N - Act/360 First Union
415 299 N 0.0900 0.0050 N - Act/360 First Union
417 359 N 0.0900 0.0050 N - Act/360 First Union
421 N 0.0900 0.0050 Y 5.0000 Act/360 First Union
424 263 N 0.0900 0.0050 N - Act/360 First Union
426 Y 0.0900 0.0050 N - 30/360 First Union Y
430 295 N 0.1150 0.0050 N - Act/360 First Union
433 N 0.0900 0.0050 N - 30/360 First Union Y
437 N 0.0900 0.0050 N - 30/360 First Union Y
438 N 0.0900 0.0050 N - 30/360 First Union Y
439 357 N 0.0900 0.0050 N - 30/360 First Union
440 355 N 0.0900 0.0050 N - Act/360 First Union
442 N 0.0900 0.0050 N - 30/360 First Union Y
443 240 N 0.0900 0.0050 N - Act/360 First Union
444 360 N 0.0900 0.0050 N - Act/360 First Union
447 N 0.0900 0.0050 N - 30/360 First Union Y
452 359 N 0.0900 0.0050 N - Act/360 First Union
453 329 N 0.0900 0.0050 N - Act/360 First Union
456 N 0.0900 0.0050 N - Act/360 First Union
457 298 N 0.0900 0.0050 N - Act/360 First Union
461 N 0.0900 0.0050 N - Act/360 First Union
462 355 N 0.0900 0.0050 N - Act/360 First Union
465 359 N 0.0900 0.0050 N - Act/360 First Union
467 N 0.0900 0.0050 N - 30/360 First Union Y
470 N 0.0900 0.0050 N - Act/360 First Union
477 297 N 0.0900 0.0050 N - 30/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
354 1.36 70.4 No Y Y
356 Walgreen Company 1.10 77.1 No N N
360 1.34 59.7 WSI Y Y
362 1.26 78.1 No N N
364 1.38 73.8 No Y Y
365 1.30 68.8 No N Y
373 1.31 77.3 No N N
374 1.30 68.7 No Y Y
375 1.37 74.7 No Y N
377 1.25 72.5 No Y Y
381 1.42 62.8 No Y Y
382 1.51 66.1 No Y N
385 1.61 74.7 No Y N
386 Walgreen Company 1.03 87.1 No N N
387 1.45 74.4 No Y Y
389 1.36 74.2 No Y N
391 1.88 69.1 No Y N
394 1.36 71.5 No N N
395 1.41 77.2 No Y Y
396 1.41 67.4 No N Y
398 1.41 62.7 No Y N
399 1.32 70.1 No Y Y
400 1.42 56.6 No Y N
401 1.41 69.4 No Y N
402 1.42 75.0 No Y Y
404 1.35 74.3 No Y N
405 1.25 68.2 No N N
407 1.27 63.6 No N N
408 Walgreen Company 1.05 83.6 No Y N
409 1.33 74.8 No N N
410 1.31 71.6 No N N
412 Walgreen Company 1.57 58.8 No Y N
413 2.23 38.7 No Y Y
415 1.40 48.3 Inn of Payson Y Y
417 1.44 79.9 No Y Y
421 1.72 80.0 No N N
424 1.65 64.6 No Y N
426 Office Depot 1.05 86.1 No Y N
430 1.38 47.6 No N N
433 JC Penney 1.01 99.4 No N N
437 Rite Aid Corp. 1.12 94.5 No Y N
438 Rite Aid Corp. 1.12 87.2 No Y N
439 1.43 69.2 No N N
440 1.34 75.8 No N N
442 JC Penney 1.24 85.8 No N N
443 1.30 74.6 No Y Y
444 1.39 80.0 No Y Y
447 JC Penney 1.00 97.1 No N N
452 1.35 79.9 No Y Y
453 1.36 77.1 No Y Y
456 1.71 69.9 No Y N
457 1.31 67.6 No Y Y
461 1.67 71.0 No Y N
462 1.25 76.8 No N Y
465 1.31 79.9 No Y Y
467 JC Penney 1.00 94.2 No N N
470 1.40 66.2 No N N
477 1.45 76.7 No N N
</TABLE>
B-23
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
First Union Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
478 Eckerd Oviedo Mitchell Hammock & Lockwood
486 Newtonian Gardens 70 West End Avenue
487 Rite Aid Gaylord 419 Main Street
489 Bella Mar 825 Ocean Avenue
490 Amerihost Inn - Macomb 1646 North Lafayette
491 Amerihost Inn-Lancaster 1721 River Valley Circle North
492 Amerihost Inn - Logan 12819 State Road 664
493 Amerihost Inn- Jeffersonville 11431 Allen Road NW
495 CVS Brazil SEC Forest Ave & National Ave
497 Lobo Canyon Shopping Center 700 East Roosevelt Ave.
499 Saint Charles Place 2199 Southwest 81st Ave.
503 Keep it Self Storage - Van Nuys 6827 Woodley Avenue
505 421 Germantown Pike 421 Germantown Pike
507 Amerihost Inn-Sycamore 1475 South Peace Rd.
509 Eckerd Shreveport Mansfield Rd/Bert Kouns Ind Loop
514 Crestwood Apartments 1428 Raymond Street
522 Warehouse Specialists - 1097 Ehlers Road 1097 Ehlers Road
528 395-435 East O'Keefe Street 395-435 East O'Keefe Street
534 Fairmount Apartments 345-57 W. Johnson Streets
538 CVS Tipton 711 East Jefferson St
539 State Farm Cranford 70 Myrtle Street
541 CVS York 820 Edgewood Road
546 CVS Rockville NWC US 36 & SR 41
547 CVS Edinburgh NEC US 31 & Eisenhower Rd
550 CVS Greece 3750 Mt. Read Boulevard
552 North Creek Townhomes 515- 112th ST. S.E.
555 Eckerd Oldsmar 3771 Tampa Road
556 Henderson Mall 675 Mall Ring Circle
557 Anchor Self Storage - Glendora 700 E. Acosta
561 Warehouse Specialists - Harrison Street 2440 Harrison Street
565 New Hampshire Apartments 345 South New Hampshire St.
567 Briarcliff 4314 Commomwealth Ave, A-1
573 IHOP Kannapolis 800 Cloverleaf Plaza
576 CVS Aiken Whiskey Rd & Shannon Lane
579 Forest Glen 2800-2875 Forest Glen Road
580 Revco Drug Store 2939 The Plaza Road
587 Glynbrook Estates 3642 Glynbrook Avenue
588 Cypress Winds 2105 Cleary
592 IHOP Gastonia 500 Cox Road
593 Taylor Gardens 7601-7715 Hillendale Road
595 Camelot and Circle Inn Mobile Home Parks 330 W. Chubbuck Rd. and 210 Circle Inn St.
601 Warehouse Specialists - 1286 Ehlers Road 1286 Ehlers Road
602 Warehouse Specialists - Dixie Street 356 Dixie Street
604 IHOP Wilmington 5355 Market Street
605 Eckerd Kernersville SEC Nelson St & Piney Grove Rd
606 Eckerds Easley 5991 Calhoun Memorial Highway
615 Kings Tree Apartments 1800 Kingsley Avenue
622 Carey Hill Plaza 220 E. Ashland Street
624 Warehouse Specialists - Bell Street 555 Bell Street
625 Warehouse Specialists - Combined Locks 100 West Prospect Street
627 Williamstown Bay 4809 Dale Street
628 52 Liberty Street 52 Liberty Street
629 Highview Apartments 930-934 Greenbriar Drive and 1024 Hillcrest Drive
630 Kingwood 118 Kingwood Drive
643 19-25 Brighton Avenue 19-25 Brighton Avenue
646 Crates shopping center 14 North Bridge Avenue
648 Roger Post 4022 North Rogers Avenue
649 Ruffolo Plaza 9701-9711 West Sample Road
650 Continental House 4318 South 25th Street
653 Sunbelt Newport News 745 Industrial Park Drive
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
478 Oveido FL 32765 1,991,102.10 15,682.26 7.1600 223 12/01/16
486 Newton NJ 07860 1,945,508.29 14,132.09 7.8700 117 02/01/08
487 Gaylord MI 49735 1,943,949.59 14,201.31 7.1250 236 01/01/18
489 Santa Monica CA 90403 1,941,881.28 15,212.24 8.1250 116 01/01/08
490 Macomb IL 61455 1,932,862.50 15,858.45 7.6250 235 12/01/17
491 Lancaster OH 43130 1,932,862.50 15,858.45 7.6250 235 12/01/17
492 Logan OH 43138 1,908,082.25 15,655.13 7.6250 235 12/01/17
493 Octa OH 43128 1,908,082.25 15,655.13 7.6250 235 12/01/17
495 Brazil IN 47834 1,900,652.99 14,839.26 6.9375 234 11/01/17
497 Grants NM 87020 1,897,834.17 14,040.83 7.5000 119 04/01/08
499 Miramar FL 33025 1,894,978.07 12,720.60 7.0625 117 02/01/08
503 Van Nuys CA 91406 1,891,488.86 14,251.60 7.6700 236 01/01/18
505 Plymouth Meeting PA 19462 1,891,079.46 13,886.71 7.3750 116 01/01/08
507 Sycamore IL 60178 1,883,301.94 15,451.82 7.6250 235 12/01/17
509 Shreveport LA 71118 1,864,065.74 13,867.66 7.7800 232 09/01/17
514 Boise ID 83701 1,817,376.36 12,132.96 7.0200 118 03/01/08
522 Menasha WI 54956 1,764,555.20 16,391.49 7.4375 178 03/01/13
528 East Palo Alto CA 94303 1,741,530.67 11,910.80 7.2500 117 02/01/08
534 Philadelphia PA 19144 1,697,942.60 12,151.15 7.1250 119 04/01/08
538 Tipton IN 46072 1,668,582.84 13,339.39 7.2500 234 11/01/17
539 Cranford NJ 07016 1,666,978.73 18,546.86 7.5625 115 12/01/07
541 York PA 17402 1,645,957.00 12,688.15 6.8500 237 02/01/18
546 Rockville IN 47872 1,604,207.35 12,524.77 6.9375 234 11/01/17
547 Edinburgh IN 46124 1,599,803.95 12,789.54 7.2500 234 11/01/17
550 Greece NY 14616 1,595,748.59 11,316.72 7.0000 236 01/01/18
552 Everett WA 98208 1,594,881.62 10,828.14 7.1700 116 01/01/08
555 Oldsmar FL 34677 1,587,542.88 12,595.46 7.3000 224 01/01/17
556 Henderson NV 89014 1,575,000.00 12,147.87 7.2100 120 05/01/08
557 Glendora CA 91740 1,556,622.29 11,305.96 7.2800 118 03/01/08
561 Neenah WI 54956 1,540,879.18 14,313.70 7.4375 178 03/01/13
565 Los Angeles CA 90020 1,498,839.13 10,273.37 7.2900 83 04/01/05
567 Charlotte NC 28205 1,493,242.99 11,216.92 7.6350 296 01/01/23
573 Kannapolis NC 28083 1,457,928.76 10,350.00 7.8750 292 09/01/22
576 Aiken SC 29803 1,436,118.62 11,306.74 7.1250 237 02/01/18
579 Baltimore MD 21216 1,421,618.18 9,682.38 7.2100 117 02/01/08
580 Charlotte NC 28205 1,420,431.88 9,835.21 7.3750 117 02/01/08
587 Keizer OR 97303 1,395,038.52 9,789.00 7.5000 115 12/01/07
588 Metairie LA 70002 1,390,838.57 9,177.03 6.9100 119 04/01/08
592 Gastonia NC 28054 1,362,341.15 9,675.00 7.8750 283 12/01/21
593 Baltimore MD 21234 1,346,725.69 9,072.43 7.1000 117 02/01/08
595 Chubbuck ID 83202 1,345,749.00 9,209.38 7.2500 116 01/01/08
601 Neenah WI 54956 1,292,350.28 12,005.04 7.4375 178 03/01/13
602 Fond Du Lac WI 54935 1,292,350.28 12,005.04 7.4375 178 03/01/13
604 Wilmington NC 28405 1,264,040.35 9,075.00 7.8750 280 09/01/21
605 Kernersville NC 27284 1,258,690.89 9,619.25 7.1250 229 06/01/17
606 Easley SC 29640 1,256,879.83 9,296.84 6.7900 225 02/01/17
615 Orange Park FL 32073 1,196,993.15 8,288.10 7.3750 117 02/01/08
622 Brockton MA 02402 1,120,962.08 8,405.34 7.6250 117 02/01/08
624 Neenah WI 54956 1,093,527.16 10,158.11 7.4375 178 03/01/13
625 Combined Locks WI 54113 1,093,527.16 10,158.11 7.4375 178 03/01/13
627 McFarland WI 53558 1,074,983.00 8,751.16 9.1100 297 02/01/23
628 Kearny NJ 07032 1,064,955.41 7,651.28 7.7500 116 01/01/08
629 DeKalb IL 60115 1,060,000.00 7,231.07 7.2500 120 05/01/08
630 Murfreesboro TN 37130 1,059,090.79 7,309.30 7.3300 175 12/01/12
643 Allston MA 02134 989,227.70 6,753.55 7.2500 119 04/01/08
646 Redbank NJ 07701 958,969.88 7,330.12 7.8750 179 04/01/13
648 Baltimore MD 21207 950,688.06 6,404.46 7.1000 117 02/01/08
649 Coral Springs FL 33065 933,851.66 7,084.98 7.7500 116 01/01/08
650 Omaha NE 68107 930,000.00 6,109.44 6.8750 120 05/01/08
653 Newport News VA 23608 891,617.14 7,247.10 8.1250 234 11/01/17
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
478 N 0.0900 0.0050 N - 30/360 First Union Y
486 357 N 0.0900 0.0050 N - Act/360 First Union
487 283 N 0.0900 0.0050 N - 30/360 First Union Y
489 296 N 0.0900 0.0050 N - Act/360 First Union
490 N 0.0900 0.0050 N - Act/360 First Union
491 N 0.0900 0.0050 N - Act/360 First Union
492 N 0.0900 0.0050 N - Act/360 First Union
493 N 0.0900 0.0050 N - Act/360 First Union
495 N 0.0900 0.0050 N - 30/360 First Union Y
497 299 N 0.0900 0.0050 N - Act/360 First Union
499 357 N 0.0900 0.0050 N - Act/360 First Union
503 296 N 0.0900 0.0050 N - Act/360 First Union
505 296 N 0.0900 0.0050 N - Act/360 First Union
507 N 0.0900 0.0050 N - Act/360 First Union
509 N 0.0900 0.0050 N - 30/360 First Union Y
514 358 N 0.0900 0.0050 N - Act/360 First Union
522 N 0.0900 0.0050 N - Act/360 First Union
528 357 N 0.0900 0.0050 N - Act/360 First Union
534 299 N 0.0900 0.0050 N - Act/360 First Union
538 N 0.0900 0.0050 N - 30/360 First Union Y
539 N 0.0900 0.0050 N - 30/360 First Union Y
541 N 0.0900 0.0050 N - 30/360 First Union Y
546 N 0.0900 0.0050 N - 30/360 First Union Y
547 N 0.0900 0.0050 N - 30/360 First Union Y
550 N 0.0900 0.0050 N - 30/360 First Union Y
552 356 N 0.0900 0.0050 N - Act/360 First Union
555 N 0.0900 0.0050 N - 30/360 First Union Y
556 252 N 0.0900 0.0050 N - Act/360 First Union
557 298 N 0.0900 0.0050 N - Act/360 First Union
561 N 0.0900 0.0050 N - Act/360 First Union
565 359 N 0.0900 0.0050 N - Act/360 First Union
567 N 0.0900 0.0050 N - Act/360 First Union
573 N 0.0900 0.0050 N - 30/360 First Union Y
576 N 0.0900 0.0050 N - 30/360 First Union Y
579 357 N 0.0900 0.0050 N - 30/360 First Union
580 357 N 0.0900 0.0050 N - Act/360 First Union
587 355 N 0.0900 0.0050 N - Act/360 First Union
588 359 N 0.0900 0.0050 N - Act/360 First Union
592 N 0.0900 0.0050 N - 30/360 First Union Y
593 357 N 0.0900 0.0050 N - 30/360 First Union
595 356 N 0.0900 0.0050 N - Act/360 First Union
601 N 0.0900 0.0050 N - Act/360 First Union
602 N 0.0900 0.0050 N - Act/360 First Union
604 N 0.0900 0.0050 N - 30/360 First Union Y
605 N 0.0900 0.0050 N - 30/360 First Union Y
606 Y 0.0900 0.0050 N - 30/360 First Union Y
615 357 N 0.0900 0.0050 N - Act/360 First Union
622 297 N 0.0900 0.0050 N - Act/360 First Union
624 N 0.0900 0.0050 N - Act/360 First Union
625 N 0.0900 0.0050 N - Act/360 First Union
627 357 N 0.0900 0.0050 N - Act/360 First Union
628 356 N 0.0900 0.0050 N - Act/360 First Union
629 360 N 0.0900 0.0050 N - Act/360 First Union
630 355 N 0.0900 0.0050 N - Act/360 First Union
643 359 N 0.0900 0.0050 N - Act/360 First Union
646 299 N 0.0900 0.0050 N - Act/360 First Union
648 357 N 0.0900 0.0050 N - 30/360 First Union
649 296 N 0.0900 0.0050 N - Act/360 First Union
650 360 N 0.0900 0.0050 N - Act/360 First Union
653 N 0.0900 0.0050 N - 30/360 First Union Y
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
478 JC Penney 1.13 75.9 No Y N
486 1.31 64.9 No N N
487 Rite Aid Corp. Y Y 1.00 102.3 No Y N
489 1.42 35.3 No N N
490 1.42 69.0 No Y N
491 1.49 55.2 No Y N
492 1.40 63.6 No Y N
493 1.41 63.6 No Y N
495 Revco D.S. Inc. 1.03 98.7 No N N
497 1.33 73.0 No Y Y
499 1.50 72.9 No Y Y
503 1.32 68.8 No Y N
505 1.26 74.2 No Y Y
507 1.41 67.3 No Y N
509 JC Penney 1.24 82.9 No N N
514 1.31 63.8 No N Y
522 1.54 53.5 WSI Y Y
528 1.27 72.6 No Y Y
534 1.26 77.2 No Y Y
538 Revco D.S. Inc. 1.03 95.4 No N N
539 State Farm 1.00 79.4 No N N
541 CVS Corporation 1.00 98.3 No N N
546 Revco D.S. Inc. 1.03 99.0 No N N
547 Revco D.S. Inc. 1.03 97.0 No N N
550 CVS Corporation 1.10 99.7 No Y N
552 1.28 72.5 No Y Y
555 JC Penney 1.34 68.0 No N N
556 1.28 67.7 No Y Y
557 1.30 65.5 No Y Y
561 1.46 64.2 WSI Y Y
565 1.28 74.9 No Y Y
567 1.43 67.9 No Y N
573 IHOP Corp 1.10 97.2 No Y N
576 CVS Corporation 1.24 74.4 No Y N
579 1.38 74.8 No N N
580 1.29 80.3 No Y Y
587 1.30 73.4 No N Y
588 1.29 79.9 No Y Y
592 IHOP Corp 1.10 96.6 No Y N
593 1.47 74.8 No N N
595 1.43 74.8 No Y Y
601 1.53 51.7 WSI Y Y
602 1.51 54.5 WSI Y Y
604 IHOP Corp 1.10 95.8 No Y N
605 JC Penney 1.20 81.2 No Y N
606 JC Penney 1.02 78.6 No N N
615 1.27 66.5 No Y Y
622 1.25 72.3 No Y N
624 1.39 57.9 WSI Y Y
625 1.42 67.1 WSI Y Y
627 1.21 73.6 No Y N
628 1.27 74.7 No Y N
629 1.23 81.5 No Y Y
630 1.29 29.8 No N Y
643 1.27 77.6 No Y Y
646 1.32 75.2 No N N
648 1.37 74.9 No N N
649 1.34 74.7 No Y N
650 1.59 71.5 No Y Y
653 Ashtead Group PLC 1.05 91.5 No N N
</TABLE>
B-24
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
First Union Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
658 USPS Fallon 120 Allen Road
660 Woodlawn Village 6601-6705 Kincheloe
661 Monmouth Beach Village 108 South Cookman Avenue
663 Pikesville Professional Building 7 Church Lane
664 Washington Place 944 Old Washington Road
667 Commerce Square Shopping Center 203 Commerce Avenue
669 Magnolia 2100 River View Rd.
671 Creamery Hills 355 Creamery Road
673 Wells Court 1856 Wells Drive
674 Logan Square Shopping Center SWC of Logan Drive and Memorial Parkway (Highway 231)
675 2486 Morris Avenue 2486 Morris Avenue
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
658 Fallon NV 89406 828,685.79 6,965.62 7.8500 231 08/01/17
660 Baltimore MD 21207 786,130.46 5,354.19 7.2100 117 02/01/08
661 Long Branch NJ 07740 780,000.00 5,168.42 6.9600 360 05/01/28
663 Pikesville MD 21208 767,358.36 5,700.25 7.5200 117 02/01/08
664 Thomson GA 30824 764,538.46 5,893.04 8.5200 299 04/01/23
667 La Grange GA 30240 747,308.05 5,603.56 7.6250 117 02/01/08
669 Tunica MS 38646 722,827.14 5,446.68 8.2500 115 12/01/07
671 Harford NY 13784 606,231.70 4,313.85 7.6500 356 01/01/28
673 Atlanta GA 30311 490,000.00 3,621.06 7.5000 300 05/01/23
674 Huntsville AL 35802 448,384.84 3,362.13 7.6250 117 02/01/08
675 Bronx NY 10468 438,203.46 3,152.21 7.7500 114 11/01/07
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
658 N 0.0900 0.0050 N - 30/360 First Union Y
660 357 N 0.0900 0.0050 N - 30/360 First Union
661 N 0.0900 0.0050 N - Act/360 First Union
663 297 N 0.0900 0.0050 N - 30/360 First Union
664 359 N 0.0900 0.0050 N - Act/360 First Union
667 297 N 0.0900 0.0050 N - Act/360 First Union
669 355 N 0.0900 0.0050 N - Act/360 First Union
671 Y 0.0900 0.0050 N - Act/360 First Union
673 N 0.0900 0.0050 N - Act/360 First Union
674 297 N 0.0900 0.0050 N - Act/360 First Union
675 354 N 0.0900 0.0050 N - Act/360 First Union
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
658 USPS Fallon 1.05 69.1 No Y N
660 1.40 74.9 No N N
661 1.32 80.0 No Y Y
663 1.28 69.8 No N N
664 1.31 85.0 No N N
667 1.37 74.7 No Y N
669 1.31 77.3 No N N
671 1.24 77.7 No Y N
673 2.55 30.2 No N Y
674 1.29 74.7 No Y N
675 1.36 74.3 No N N
</TABLE>
B-25
<PAGE>
SCHEDULE I
General Mortgage Representations and Warranties
(i) The information pertaining to each Mortgage Loan set forth in
the Mortgage Loan Schedule was true and correct in all material respects as of
the Cut-Off Date;
(ii) If such Mortgage Loan was originated by the Seller or an
affiliate thereof, then, as of the date of its origination, such Mortgage Loan
complied in all material respects with, or was exempt from, all requirements of
federal, state or local law relating to the origination of such Mortgage Loan;
and, if such Mortgage Loan was not originated by the Seller or an affiliate
thereof, then, to the best of the Seller's knowledge after having performed the
type of due diligence customarily performed by prudent institutional commercial
and multifamily mortgage lenders, as of the date of its origination, such
Mortgage Loan complied in all material respects with, or was exempt from, all
requirements of federal, state or local law relating to the origination of such
Mortgage Loan;
(iii) The Seller owns the Mortgage Loan, has good and marketable
title thereto, has full right and authority to sell, assign and transfer the
Mortgage Loan and is transferring the Mortgage Loan free and clear of any and
all liens, pledges, charges or security interests of any nature encumbering such
Mortgage Loan, and no provision of the Mortgage Note, Mortgage or other loan
document relating to such Mortgage Loan prohibits or restricts the Seller's
right to assign or transfer such Mortgage Loan;
(iv) The proceeds of such Mortgage Loan have been fully disbursed
and there is no requirement for future advances thereunder;
(v) Each of the related Mortgage Note, Mortgage(s), Assignment of
Leases, if any, and other agreements executed in connection therewith is the
legal, valid and binding obligation of the maker thereof (subject to any
non-recourse provisions therein and any state anti-deficiency legislation),
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally, and by general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law);
(vi) As of the date of its origination, there was no valid offset,
defense, counterclaim or right to rescission with respect to any of the related
Mortgage Note, Mortgage(s) or other agreements executed in connection therewith,
and, as of the
<PAGE>
Cut-off Date, to the best knowledge of the Seller, there is no valid offset,
defense, counterclaim or right to rescission with respect to such Mortgage Note,
Mortgage(s) or other agreements;
(vii) The assignment of the related Mortgage and Assignment of
Leases to the Trustee constitutes the legal, valid, binding and enforceable
assignment of such Mortgage in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally, and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law);
(viii) Except with respect to the Mortgage Loans listed in Exhibit
I-VIII hereto, each related Mortgage is a valid and enforceable first lien on
the related Mortgaged Property, which Mortgaged Property is free and clear of
all encumbrances and liens having priority over or on a parity with the first
lien of such Mortgage, except for (a) liens for real estate taxes and special
assessments not yet due and payable, (b) covenants, conditions and restrictions,
rights of way, easements and other matters of public record as of the date of
recording of such Mortgage, such exceptions appearing of record being
customarily acceptable to mortgage lending institutions generally or
specifically reflected in the appraisal of such Mortgaged Property made in
connection with the origination of such Mortgage Loan, and (c) other matters to
which like properties are commonly subject and which do not, individually or in
the aggregate, materially interfere with the benefits of the security intended
to be provided by such Mortgage or materially affect the value or marketability
of such Mortgaged Property, and such encumbrances do not materially interfere
with the current use or operation of the related Mortgaged Property and, except
with respect to the Mortgage Loans listed in Exhibit I-VIII hereto, there exists
with respect to such Mortgaged Property an assignment of leases and rents
provision, whether as part of the related Mortgage or as a separate document or
instrument, which establishes and creates a first priority security interest in
and to leases and rents arising in respect of the related Mortgaged Property,
subject only to encumbrances described in subsections (a), (b) and (c) of this
subparagraph (viii);
(ix) The Seller has filed and/or recorded in all appropriate public
filing and recording offices all UCC-1 financing statements necessary to create
and perfect a security interest in and lien on the items of personal property
described therein (or, if not filed and/or recorded, has submitted such UCC-1
financing statements for filing and/or recording and such UCC-1 financing
statements are in form and substance acceptable for filing and/or recording), to
the extent perfection may be effected pursuant to applicable law by recording or
filing;
-2-
<PAGE>
(x) All taxes and governmental assessments that prior to the Cut-off
Date became due and owing in respect of, and affect, each related Mortgaged
Property have been paid, or an escrow of funds in an amount sufficient to cover
such payments has been established;
(xi) As of the date of its origination, there was no proceeding
pending for the total or partial condemnation of each related Mortgaged Property
that materially affects the value thereof, and such Mortgaged Property was free
of material damage; and, as of the Cut-off Date, the Seller has not received any
notice of the commencement of any proceeding for the total or partial
condemnation of any related Mortgaged Property that materially affects the value
thereof, and such Mortgaged Property is free of material damage;
(xii) Each related Mortgaged Property is covered by an ALTA (or its
equivalent) lender's title insurance policy insuring that each related Mortgage
is a valid first lien on such Mortgaged Property in the original principal
amount of the Mortgage Loan after all advances of principal, or there is a
binding commitment from a title insurer qualified and licensed in the applicable
jurisdiction, as required, to issue such policy; such title insurance policy, if
issued, is in full force and effect, is freely assignable and will inure solely
to the benefit of the Trustee as mortgagee of record, or any such commitment is
a legal, valid and binding obligation of such insurer; no claims have been made
under such title insurance policy, if issued; and to the best knowledge of the
Seller, no prior mortgagee has done, by act or omission, anything which would
materially impair the coverage of any such title insurance policy;
(xiii) As of the date of its origination, all insurance required
under each related Mortgage, which insurance covered such risks as were
customarily acceptable to prudent commercial and multifamily mortgage lending
institutions lending on the security of property comparable to the related
Mortgaged Property in the jurisdiction in which such Mortgaged Property is
located, and with respect to a fire and extended perils insurance policy, was in
an amount (subject to a customary deductible) at least equal to 100% of the full
insurable replacement cost of the improvements located on such Mortgaged
Property (except to the extent not permitted by applicable law and then in such
event in an amount in excess of the initial principal balance of the Mortgage
Loan, together with an "agreed value endorsement"), was in full force and effect
with respect to each related Mortgaged Property; and, as of the Cut-off Date, to
the best knowledge of the Seller, all insurance required under each Mortgage,
which insurance covers such risks and is in such amounts as are customarily
acceptable to prudent commercial and multifamily mortgage lending institutions
lending on the security of property comparable to the related Mortgaged Property
in the jurisdiction in which such Mortgaged Property is located, is in full
force and effect with respect to each related Mortgaged Property; and no
-3-
<PAGE>
notice of termination or cancellation with respect to any such insurance policy
has been received by the Seller; except for certain amounts not greater than
amounts which would be considered prudent by an institutional commercial
mortgage lender with respect to a similar mortgage loan and which are set forth
in the related Mortgage, any insurance proceeds in respect of a casualty loss or
taking, will be applied either to the repair or restoration of all or part of
the related Mortgaged Property or the reduction of the outstanding principal
balance of the Mortgage Loan;
(xiv) Other than payments due but not yet 30 days or more
delinquent, there is, to the best of the Seller's knowledge, (A) no material
default, breach, violation or event of acceleration existing under the related
Mortgage Note or each related Mortgage, and no event which, with the passage of
time or with notice and (B) the expiration of any grace or cure period, would
constitute a material default, breach, violation or event of acceleration under
any of such documents; the Seller has not waived any other material default,
breach, violation or event of acceleration under any of such documents; and
under the terms of each Mortgage Loan, each related Mortgage Note, each related
Mortgage and the other loan documents in the related Mortgage File, no person or
party other than the mortgagee may declare an event of default or accelerate the
related indebtedness under such Mortgage Loan, Mortgage Note or Mortgage;
(xv) As of the Cut-off Date, the Mortgage Loan is not, and in the
prior 12 months (or since the date of origination if such Mortgage Loan has been
originated within the past 12 months), has not been, 30 days or more past due in
respect of any Scheduled Payment;
(xvi) Except with respect to the Mortgage Loans listed in Exhibit
I-XVI hereto which accrue interest on the basis of the actual number of days
elapsed over a 360 day year, the Mortgage Loan accrues interest (payable monthly
in arrears) at a fixed rate of interest (except with respect to ARD Loans, with
respect to which the rate at which interest accrues thereon increases after the
Anticipated Repayment Date, except with respect to the Mortgage Loans listed in
Exhibit I-XVI hereto and except in connection with the occurrence of a default
and the accrual of default interest) on the basis of a 360-day year consisting
of twelve 30-day months;
(xvii) Each related Mortgage does not provide for or permit, without
the prior written consent of the holder of the Mortgage Note, each related
Mortgaged Property to secure any other promissory note or obligation, except as
expressly described in such Mortgage and other than another Mortgage Loan in the
Trust Fund;
(xviii) Such Mortgage Loan is or constitutes part of a "qualified
mortgage" within the meaning of Section
-4-
<PAGE>
860G(a)(3) of the Code. Accordingly, either as of the date of origination or the
Closing Date, the fair market value of the real property securing the Mortgage
Loan was not less than 80% of the "adjusted issue price" (within the meaning of
the REMIC Provisions) of such Mortgage Loan. For purposes of the preceding
sentence, the fair market value of the real property securing the Mortgage Loan
was first reduced by the amount of any lien on such real property that is senior
to the lien that secures such Mortgage Loan, and was further reduced by a
proportionate amount of any lien that is on a parity with the lien that secures
such Mortgage Loan;
(xix) Prepayment Premiums and Yield Maintenance Charges payable with
respect to the Mortgage Loan, if any, constitute "customary prepayment
penalties" within the meaning of Treasury Regulation Section 1.860G-1(b)(2);
(xx) One or more environmental site assessments were performed by an
environmental consulting firm independent of the Seller and the Seller's
affiliates with respect to each related Mortgaged Property during the 18-month
period preceding the Cut-off Date, and the Seller, having made no independent
inquiry other than to review the report(s) prepared in connection with the
assessment(s) referenced herein, has no knowledge of any material and adverse
environmental condition or circumstance affecting such Mortgaged Property that
was not disclosed in such report(s);
(xxi) The related Mortgage Note, Mortgage(s) and Assignment(s) of
Leases, if any, contain customary and enforceable provisions such as to render
the rights and remedies of the holder thereof adequate for the realization
against the related Mortgaged Property or Properties of the benefits of the
security, including realization by judicial or, if applicable, non-judicial
foreclosure, subject to applicable reorganization, insolvency, moratorium and
other similar laws affecting creditors' rights generally as from time to time,
in effect, and to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(xxii) To the best of the Seller's knowledge, after due inquiry, the
related Mortgagor is not a debtor in any bankruptcy, reorganization, insolvency
or comparable proceeding;
(xxiii) Such Mortgage Loan is secured by either a mortgage on a fee
simple interest or a leasehold estate in a commercial property or multifamily
property, including the related Mortgagor's interest in the improvements on the
related Mortgaged Property;
(xxiv) Unless such Mortgage Loan is an ARD Loan, such Mortgage Loan
does not provide for negative amortization;
-5-
<PAGE>
(xxv) Such Mortgage Loan is a whole loan, contains no equity
participation by the lender or shared appreciation feature and does not provide
for any contingent or additional interest in the form of participation in the
cash flow of the related Mortgaged Property;
(xxvi) The related Mortgage contains provisions for the acceleration
of the payment of the unpaid principal balance of such Mortgage Loan if, without
the prior written consent of the mortgagee, any related Mortgaged Property or
interest therein, is directly encumbered in connection with subordinate
financing by a lien or security interest against the related Mortgaged Property;
provided, however, the Mortgage Loans listed in Exhibit I-XXVI hereto, are
encumbered by subordinated debt;
(xxvii) None of the Mortgage Loans other than those listed in
Exhibit I-XXVII hereto, permit one or more transfers of the related Mortgaged
Property to a person or entity without (A) the satisfaction of certain criteria
(including criteria related to bankruptcy remoteness and property management
experience) specified in the related Mortgage, (B) the payment of an assumption
fee and certain other conditions, and (C) without the ability to accelerate the
payment of the unpaid principal balance of such Mortgage Loan if any related
Mortgaged Property or interest therein is directly or indirectly transferred or
sold without the prior written consent of the mortgagee, or sold without the
related Mortgagor having satisfied certain conditions specified in the related
Mortgage with respect to permitted transfers;
(xxviii) The Mortgage Loan, together with any other Mortgage Loan
made to the same Mortgagor or to an affiliate of such Mortgagor, does not
represent more than 5% of the aggregate Initial Pool Balance;
(xxix) Except as set forth in the related Mortgage File, the terms
of the related Mortgage Note and Mortgage(s) have not been waived, modified,
altered, satisfied, impaired, canceled, subordinated or rescinded in any manner
which materially interferes with the security intended to be provided by such
Mortgage;
(xxx) Each related Mortgaged Property was inspected by or on behalf
of the related originator during the 12 month period prior to the related
origination date;
(xxxi) Except for the Mortgage Loans listed in Exhibit I-XXXI
hereto, the terms of the related Mortgage Note or Mortgage do not provide for
the release of any material portion of the related Mortgaged Property from the
lien of such Mortgage without payment in full of the Mortgage Loan;
-6-
<PAGE>
(xxxii) The related Mortgagor has covenanted in the Mortgage Loan
documents to maintain the related Mortgaged Property in compliance with all
applicable laws, zoning ordinances, rules, covenants and restrictions affecting
the construction, occupancy, use and operation of such Mortgaged Property, and
the related originator performed the type of due diligence in connection with
the origination of such Mortgage Loan customarily performed by prudent
institutional commercial and multifamily mortgage lenders with respect to the
foregoing matters; the Seller has received no notice of any material violation
of any applicable laws, zoning ordinances, rules, covenants or restrictions
affecting the construction, occupancy, use or operation of such Mortgaged
Property; to the Seller's knowledge (based on surveys and/or title insurance
obtained in connection with the origination of such Mortgage Loan), as of the
date of such origination, no improvement that was included for the purpose of
determining the appraised value of the related Mortgaged Property at the time of
origination of such Mortgage Loan lay outside the boundaries and building
restriction lines of such property to an extent which would have a material
adverse affect on the related Mortgagor's use and operation of such Mortgaged
Property (unless affirmatively covered by the title insurance referred to in
paragraph (xii) above), and no improvements on adjoining properties encroached
upon such Mortgaged Property to any material extent;
(xxxiii) Except with respect to Credit Lease Loans, the related
Mortgagor has covenanted in the Mortgage Loan documents to deliver each year to
the mortgagee an operating statement of each related Mortgaged Property covering
the twelve-month period identified therein;
(xxxiv) With respect to at least 95% of the Mortgage Loans (by
balance) having a Cut-off Date Balance in excess of 1% of the Initial Pool
Balance, the related Mortgagor has covenanted in its organizational documents
and/or the Mortgage Loan documents to own no significant asset other than the
related Mortgaged Property or Mortgaged Properties, as applicable, and assets
incidental to its ownership and operation of such Mortgaged Property;
(xxxv) No advance of funds has been made, directly or indirectly, by
the Seller to the Mortgagor other than pursuant to the Mortgage Note and no
funds have been received from any person other than such Mortgagor for or on
account of payments due on the Mortgage Note;
(xxxvi) To the Seller's actual knowledge, there are no pending
actions, suits or proceedings by or before any court or governmental authority
against or affecting the related Mortgagor or the related Mortgaged Property
that, if determined adversely to such Mortgagor or Mortgaged Property, would
materially and adversely affect the value of the Mortgaged
-7-
<PAGE>
Property or the ability of the Mortgagor to pay principal, interest or any other
amounts due under such Mortgage Loan;
(xxxvii) Such Mortgage Loan complied with all applicable usury laws
in effect at its date of origination;
(xxxviii) To the extent required under applicable law as of the
Closing Date, the originator of such Mortgage Loan was authorized to do business
in the jurisdiction in which the related Mortgaged Property is located at all
times when it held the Mortgage Loan to the extent necessary to ensure the
enforceability of such Mortgage Loan;
(xxxix) If the related Mortgage is a deed of trust, a trustee, duly
qualified under applicable law to serve as such, is properly designated and
serving under such Mortgage;
(xl) The related Mortgage Note is not secured by any collateral that
secures a mortgage loan that is not in the Trust Fund (except with respect to
the Mortgage Loans listed in Exhibit I-XL hereto), and each Mortgage Loan that
is cross-collateralized is cross-collateralized only with other Mortgage Loans
sold pursuant to this Agreement;
(xli) The related Mortgaged Property either is not located in a
flood hazard area as defined by the Federal Insurance Administration or is
covered by flood hazard insurance;
(xlii) Except with respect to the Mortgage Loans listed on Exhibit
I-XLII hereto, one or more engineering assessments were performed by an
engineering consulting firm independent of the Seller and the Seller's
affiliates with respect to each related Mortgaged Property during the 18-month
period preceding the Cut-off Date, and the Seller, having made no independent
inquiry other than to review the report(s) prepared in connection with the
assessment(s) referenced herein, has no knowledge of any material and adverse
engineering condition or circumstance affecting such Mortgaged Property that was
not disclosed in such report(s);
(xliii) All escrow deposits and payments relating to the Mortgage
Loan are under control of the Seller or the servicer of such Mortgage Loan and
all amounts required as of the date hereof under the Mortgage Loan Documents to
be deposited by the related Mortgagor have been deposited;
(xliv) The related Mortgagor has represented to the Seller that as
of the date of origination of the Mortgage Loan, such Mortgagor, the related
lessee, franchisor or operator was in possession of all licenses, permits and
authorizations then required for use of the related Mortgaged Property, which
were valid and in full force and effect; and
-8-
<PAGE>
(xlv) The origination, servicing and collection practices used by
the Seller or any prior holder of the Mortgage Note have been in all respects
legal and have met customary industry standards.
(xlvi) Except as set forth in Schedule II, the Mortgage Loan is
secured in whole or in part by a fee simple interest.
-9-
<PAGE>
SCHEDULE II
Ground Lease Representations and Warranties
(i) With respect to any Mortgage Loan that is secured in whole or in
material part by the interest of a Mortgagor as a lessee under a Ground Lease
but not by the related fee interest:
(A) Such Ground Lease or a memorandum thereof has been or will be duly
recorded (other than the Ground Lease related to the Mortgage Loan listed
in Exhibit II-A hereto) and such Ground Lease permits the interest of the
lessee thereunder to be encumbered by the related Mortgage or, if consent
of the lessor thereunder is required, it has been obtained prior to the
Closing Date;
(B) Upon the foreclosure of the Mortgage Loan (or acceptance of a deed in
lieu thereof), the Mortgagor's interest in such Ground Lease is assignable
to the Trustee without the consent of the lessor thereunder (or, if any
such consent is required, it has been obtained prior to the Closing Date)
and, in the event that it is so assigned, is further assignable by the
Trustee and its successors without a need to obtain the consent of such
lessor; provided, that the lessor's consent to a subsequent sale is
required under the Ground Lease related to the Mortgage Loans listed in
Exhibit II-B hereto;
(C) Such Ground Lease may not be amended, modified, canceled or terminated
without the prior written consent of the Mortgagee thereunder and that any
such action without such consent is not binding on such Mortgagee, its
successors or assigns;
(D) Unless otherwise set forth in the Ground Lease, the Ground Lease does
not permit any increase in the amount of rent payable by the ground lessee
thereunder during the term of the Mortgage Loan;
(E) Such Ground Lease was in full force and effect as of the date of
origination of the related Mortgage Loan, and to the actual knowledge of
the Seller, at the Closing Date, such Ground Lease is in full force and
effect and other than payments due but not yet 30 days or more delinquent,
(1) there is no material default, and (2) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a material default under such Ground Lease;
(F) Such Ground Lease or an estoppel or consent letter received by the
Mortgagee from the lessor, requires the lessor thereunder to give notice
of any default by the lessee to the Mortgagee; and such Ground Lease, or
an
-10-
<PAGE>
estoppel or consent letter received by the Mortgagee from the lessor,
further provides either (1) that no notice of termination given under such
Ground Lease is effective against the Mortgagee unless a copy has been
delivered to the Mortgagee in the manner described in such Ground Lease,
estoppel or consent letter or (2) that upon any termination of the Ground
Lease the lessor will enter into a new lease with the mortgagee;
(G) The ground lessee's interest in the Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority with, the related
Mortgage, other than the related ground lessor's related fee interest and
any exceptions stated in the related title insurance policy or opinion of
title, which exceptions do not and will not materially and adversely
interfere with (1) the ability of the related Mortgagor timely to pay in
full the principal and interest on the related Mortgage Note, (2) the use
of such Mortgaged Property for the use currently being made thereof, or
(3) the value of the Mortgaged Property;
(H) A Mortgagee is permitted a reasonable opportunity to cure any curable
default under such Ground Lease before the lessor thereunder may terminate
such Ground Lease;
(I) Such Ground Lease has an original term (together with any extension
options, whether or not currently exercised, set forth therein) that
extends not less than 10 years beyond the Stated Maturity Date of the
related Mortgage Loan;
(J) Except with respect to the Ground Lease related to each of the
Mortgage Loans listed in Exhibit II-J hereto, under the terms of such
Ground Lease, any estoppel or consent letter received by the Mortgagee
from the lessor, and the related Mortgage, taken together, any related
insurance proceeds or condemnation proceeds will be applied either to the
repair or restoration of all or part of the related Mortgaged Property,
with the Mortgagee or a trustee appointed by it having the right to hold
and disburse such proceeds as the repair or restoration progresses, or to
the payment of the outstanding principal balance of the Mortgage Loan
together with any accrued interest thereon;
(K) Such Ground Lease does not impose any restrictions on subletting which
would be viewed as commercially unreasonable by a prudent commercial
mortgage lender;
(L) Except with respect to Mortgage Loans listed on Exhibit II-L hereto,
the ground lessor under such Ground Lease is required to enter into a new
lease upon termination of the Ground Lease for any reason, including the
rejection of the Ground Lease in bankruptcy, and for any reason, upon the
request of the lender; and
-11-
<PAGE>
(M) The terms of the related Ground Lease have not been waived, modified,
altered, satisfied, impaired, canceled, subordinated or rescinded in any
manner which materially interferes with the security intended to be
provided by such Mortgage.
(ii) With respect to Mortgage Loans secured in whole or
in part by the interest of the related mortgagor under a Ground Lease and by the
related fee interest, such fee interest is subject, and subordinated of record,
to the related Mortgage, and such Mortgage does not by its terms provide that it
will be subordinated to the lien of any other mortgage or other lien upon such
fee interest.
-12-
<PAGE>
SCHEDULE III
Health Care Facility Representations and Warranties
With respect to any Mortgage Loan that is secured in whole or in
part by a Mortgage Property which is operated as a residential health care
facility (a "Facility");
(A) All governmental licenses, permits, regulatory agreements or other
approvals or agreements necessary for the use and operation of each
Facility as intended are held by the related Mortgagor or the operator of
the Facility, and are in full force and effect, including, without
limitation, a valid certificate of need ("CON") or similar certificate,
license, or approval issued by the applicable department of health for the
requisite number of beds, and approved provider status in any approved
provider payment program (collectively, the "Licenses").
(B) The Licenses (1) may not be, and have not been, transferred to any
location other than the Facility; (2) have not been pledged as collateral
security for any other loan or indebtedness; and (3) are held free from
restrictions or known conflicts which would materially impair the use or
operation of the Facility as intended, and are not provisional,
probationary or restricted in any way.
(C) As of the Cut-off Date and to Seller's knowledge, without inquiry, (1)
as of the Cut-off Date, the Facility has not received a "Level A" (or
equivalent) violation which has not been cured to the satisfaction of the
applicable governmental agency, and (2) no statement of charges or
deficiencies has been made or penalty enforcement action has been
undertaken against the Facility, its operator or the Mortgagor or against
any officer, director or stockholder of such operator or the Mortgagor by
any governmental agency during the last three calendar years, and there
have been no violations over the past three years which have threatened
the Facility's, the operator's or the Mortgagor's certification for
participation in Medicare or Medicaid or the other third-party payors'
programs.
-13-
<PAGE>
SCHEDULE IV
Credit Lease Loan Representations and Warranties
With respect to any Mortgage Loan that is a Credit Lease Loan;
(A) Except with respect to the Mortgage Loans listed in Exhibit IV-A
hereto, the lease payments due under the related Credit Lease, together
with any escrow payments held by the Seller or its designee, are equal to
or greater than the payments due with respect to the related Mortgage
Loan;
(B) Except with respect to Credit Lease Loans as indicated in Exhibit IV-B
hereto, the Mortgagor does not have monetary obligations under the related
Credit Lease, and every monetary obligation associated with managing,
owning, developing and operating the leased property, including, but not
limited to, the costs associated with utilities, taxes, insurance,
maintenance and repairs is an obligation of the related Tenant;
(C) Except with respect to Credit Lease Loans listed in Exhibit IV-C
hereto, the Mortgagor does not have any nonmonetary obligations under the
related Credit Lease, except for the delivery of possession of the leased
property;
(D) Except with respect to the Credit Lease Loans listed in Exhibit IV-D
hereto, the Mortgagor has not made any representation or warranty in the
related Credit Lease, a breach of which would result in the termination
of, or an offset or abatement with respect to, such Credit Lease;
(E) Except with respect to the Credit Lease Loans listed in Exhibit IV-E
hereto, the related Tenant cannot terminate such Credit Lease for any
reason prior to the payment in full of: (a) the principal balance of the
related Mortgage Loan; (b) all accrued and unpaid interest on such
Mortgage Loan; and (c) any other sums due and payable under such Mortgage
Loan, as of the termination date, which date is a rent payment date,
except for a default by the related Mortgagor under the Credit Lease or
due to a casualty or condemnation event, in which case, a Lease
Enhancement Policy insures against such risk;
(F) In the event the related Tenant assigns or sublets the related leased
property, such Tenant (and if applicable, the related guarantor) remains
obligated under the related Credit Lease;
(G) Except with respect to the Credit Lease Loans listed in Exhibit IV-G
hereto, each property related to a Credit Lease Loan is a separate tax
lot;
-14-
<PAGE>
(H) Except with respect to the Credit Lease Loans listed in Exhibit IV-H
hereto, the related Tenant has agreed to indemnify the Mortgagor from any
claims of any nature other than the acts or omissions of the related
Mortgagor, (a) to which the Mortgagor is subject because of such
Mortgagor's estate in the leased property, or (b) arising from (i) injury
to or death of any person or damage to or loss of property on the leased
property or connected with the use, condition or occupancy of the leased
property, (ii) Tenant's violation of the related Credit Lease, or (iii)
any act or omission of the Tenant;
(I) Except with respect to the Mortgage Loans listed in Exhibit IV-I
hereto, related Tenant has agreed to indemnify the Mortgagor from any
claims of any nature arising as a result of any hazardous material
affecting the leased property and due to such Tenant's use of the leased
property;
(J) Except with respect to the Mortgage Loans listed in Exhibit IV-J
hereto, in connection with Credit Lease Loans with respect to which a
Guaranty exists, the related guarantor guarantees the payment due under
the related Credit Lease and such Guaranty, on its face, contains no
conditions to such payment;
(K) With respect to Credit Lease Loans that have the benefit of residual
value insurance policies, surety value policies and lease enhancement
policies, each such policy has been obtained, and with respect to the
Credit Leases other than bond-type leases, the required premiums have been
paid; and
(L) The list of lease guarantors, if any, attached as Exhibit IV-L hereto,
is accurate in all material respects.
-15-
<PAGE>
Schedule V
Gentlemen:
I have acted as counsel to [SELLER]. First Union Commercial Mortgage
Securities, Inc. will acquire certain mortgage loans from [seller] pursuant to
the Mortgage Loan Purchase Agreement, dated as of [ ] (the "Mortgage Loan
Purchase Agreement"). Capitalized terms used but not defined herein shall have
the meanings set forth in the Mortgage Loan Purchase Agreement.
You have asked for my opinion regarding the due authorization of
[Seller] to enter into the Mortgage Loan Purchase Agreement.
As to matters of fact material to this opinion, I have relied,
without independent investigation on (i) the representations and warranties of
[SELLER] in the Mortgage Loan Purchase Agreement, (ii) relevant resolutions of
the Board of Directors of [SELLER], (iii) certificates of responsible officers
of [SELLER] and (iv) certificates of public officials.
In this connection, I have examined or have caused to be examined on
my behalf, a copy of the Mortgage Loan Purchase Agreement and such other
documents and instruments which I have deemed necessary or appropriate in
connection with this opinion.
I have relied on originals or copies, certified or otherwise
identified to my satisfaction, of the certificate of incorporation and by-laws
of [SELLER], records of proceedings taken by [SELLER], and such other corporate
documents and records of [SELLER], and have made such other investigations as I
have deemed relevant or necessary for the purpose of this opinion. I have
assumed, without independent investigation, the genuineness of all signatures
(other than those of officers of [SELLER]), the authenticity of all documents
submitted to me as originals and the conformity to original documents of all
documents submitted to me as certified, conformed or reproduction copies.
On the basis of and subject to the foregoing, it is my opinion that:
(1) [SELLER] is a [corporation] duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, with the corporate
power and authority to transact the business contemplated by the Mortgage Loan
Purchase Agreement, and it has the requisite corporate power and authority to.
execute and deliver the Mortgage Loan Purchase Agreement and to perform and
observe the terms and conditions thereof.
-16-
<PAGE>
(2) The Mortgage Loan Purchase Agreement has been duly authorized,
executed and delivered by [SELLER].
(3) The execution, delivery and performance by [SELLER] of the
Mortgage Loan Purchase Agreement will not conflict with, result in a breach of,
or constitute a default under any material term of [SELLER]'s certificate of
incorporation or bylaws, any term or provision of any material contract,
agreement or other instrument known to me to which [SELLER] is a party or by
which it is bound, or, to the best of my knowledge without independent
investigation, any order, judgment, writ, injunction or decree known to me of
any court or governmental authority having jurisdiction over [SELLER].
(4) The Mortgage Loan Purchase Agreement constitutes, assuming due
authorization, execution and delivery by the other party thereto, the valid and
binding obligation of [SELLER] enforceable against [SELLER] in accordance with
its terms, except as such enforcement may be limited by (a) bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally, (b) general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law) and
(c) limitations of public policy under applicable securities laws as to rights
of indemnity thereunder.
In furnishing the foregoing opinions, I express no opinion other
than as to the general corporation law of the State of Delaware, the law of the
State of New York and the federal law of the United States of America.
This opinion is being delivered to you for your sole use in
connection with the above-referenced transactions and may not be used or relied
upon by any other person, firm or entity in any other context for any other
purpose. This opinion may not be quoted in whole or in part, nor may copies be
furnished or delivered to any other person without the consent of [SELLER]
except that you may furnish copies to (i) your independent auditors and
attorneys, (ii) any United States, state or local authority having jurisdiction
over you, (iii) pursuant to the order of any legal process of any court of
competent jurisdiction or governmental agency, and (iv) in connection with any
legal action arising in connection with the above-referenced transactions.
Very truly yours,
-17-
<PAGE>
EXHIBIT B
Exception to Section 2(c)
None
<PAGE>
EXHIBIT I-VIII
Exception to Clause (viii) of Schedule I
None
<PAGE>
EXHIBIT I-XVI
Exceptions to Clause (xvi) of Schedule I
<PAGE>
Exhibit I - XVI Loans where interest is calculatd on Actual/360
<TABLE>
<CAPTION>
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First
Union
Prosup # Control # Property Name Address
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
5 324 First Union Plaza 999 Peachtree Street
6 1 Oakwood Village 185 Route 206
7 2 Phillips Place 6800 Fairview Road
13 5 Peach Tree Apartments 2002-2042 Peach Orchard Drive
16 313 100 West Chestnut St. 100 West Chestnut St.
18 307 Holly Hall 2111 Holly Hall Drive
21 316 Burke Centre Burke Centre Pkwy. & Rte. 123
25 9 Quince Orchard I Apartments 805 Quince Orchard Blvd
28 10 Peachtree Walk 1074-1075 Peachtree Walk
33 12 Consolidated Cap Care Properties (8) Various
36 14 Hechinger Commons Shopping Center 3101-3231 Duke Street
38 16 Sandy Springs Plaza 6221 - 6351 Roswell Road NE
39 17 The Plantation at Lafayette 211 Liberty Ave.
41 319 Woodholme Medical Building 1838 Greene Tree Road
53 22 Quince Orchard II Apartments 805 Quince Orchard Blvd
57 24 Northwind 1680 Sky Mountain Road
61 27 Old Farm 3751 Appian Way
62 28 River Reach 628 River Reach Dr.
64 29 Health Care South (6 Prop) Various
65 30 Spinnaker Reach Apartments 3875 San Pablo Rd.
67 31 Eastland Plaza 678 North Wilson Way
68 312 Woodhaven Apartments 625 South Redwood Road
69 32 Best Western Greenfield Inn 3000 Enterprise Drive
71 205 Plaza LaFayette 13011 - 13051 Newport Avenue
72 33 The Broun Portfolio Consolidation Various
76 34 Liberty Gardens 101 Liberty Garden Road
78 35 Kings Harbor Multicare Center 2000 East Gun Hill Road
82 37 Valley Manor 141C Marina Drive
85 310 Sandstone Apartments 405 East Prince Road
90 38 Hampton Inn & Suites - Pineville 401 Towne Centre Boulevard
93 40 Claremont Retirement Village 7041 Bent Tree Blvd.
94 39 Brookside West Apartments 420 Berman Road
95 323 Harris Boulevard I 5100 West Harris Bouldevard
96 41 Scott Mountain by the Brook 7828 SE Aspen Summit Drive
105 209 Innsbrook Shoppes 4206 Cox Road
109 210 Montgomery Street 135 Montgomery Street
121 211 Fountain Court 6355-6605 Manatee Avenue
126 315 The Addison 831 E. Morehead St.
127 43 Carolina Apartments 401 Highway 54 Bypass
128 212 Holiday Inn Lynchburg 601 Main Street
129 44 PalmTree Plaza 3513-3533 Canon Road
132 213 Franklin Plaza 281-339 Bickett Boulevard
133 45 Cumberland Green 26 Ladow Avenue
134 46 Spring Center 8627 16th Street
138 335 Green Grove 99 Green Grove
139 48 Constantine Village 26 Constantine Place
141 217 Shoppes of Olney 3110-3134 Olney Sandy Spring Road
142 49 United HealthCare Office Bldg 13621 NW 12th Street
146 50 540 Atlantic Avenue 540 Atlantic Avenue
147 51 Maple Leaf Plaza 540 Water Street
150 216 K & K Warehousing - 701 Fourth Avenue 701 Fourth Avenue
153 52 Mount Vernon 38-A Mount Vernon Drive
158 53 Leonardine Gardens 110 Leonardine Avenue
163 56 Hampton Inn Detroit Metro Airport 30847 Flynn Drive
167 224 Southside Comfort Inn 120 West Third Street
168 308 Mill Park Apartments 2900 McCann Road
<CAPTION>
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Original Cut-off date Mortgage Maturity Accrual
Prosup # City State Zip Code Balance Balance Rate Date Method
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
5 Atlanta GA 30309 64,000,000 64,000,000 6.7500 5/1/13 Actual/360
6 Mount Olive NJ 07836 64,000,000 63,766,163 7.3600 12/1/27 Actual/360
7 Charlotte NC 28200 25,350,000 25,328,345 6.7900 4/1/08 Actual/360
13 Falls Church VA 22043 21,200,000 21,172,008 7.3750 3/1/13 Actual/360
16 Chicago IL 60610 20,000,000 20,000,000 6.8500 5/1/08 Actual/360
18 Houston TX 77054 17,697,000 17,697,000 8.1400 7/1/07 Actual/360
21 Burke VA 22015 16,500,000 16,446,274 7.0800 1/1/13 Actual/360
25 Gaithersburg MD 20876 15,182,000 15,161,954 7.3750 3/1/13 Actual/360
28 Atlanta GA 30309 14,500,000 14,452,039 7.0000 1/1/08 Actual/360
33 Various AR Various 13,500,000 13,404,516 7.7500 1/1/18 Actual/360
36 Alexandria VA 22314 13,250,000 13,230,218 6.8750 3/1/11 Actual/360
38 Sandy Springs (Atlanta) GA 30328 13,200,000 13,189,313 7.0625 4/1/08 Actual/360
39 Lafayette LA 70508 12,750,000 12,750,000 7.5400 11/1/07 Actual/360
41 Baltimore MD 21208 12,500,000 12,443,168 7.6000 12/1/07 Actual/360
53 Gaithersburg MD 20878 10,994,000 10,979,484 7.3750 3/1/13 Actual/360
57 Reno NV 89503 10,600,000 10,585,107 7.1250 3/1/08 Actual/360
61 Lexington KY 40517 10,000,000 9,968,199 7.2000 1/1/08 Actual/360
62 Orlando FL 32828 9,945,000 9,932,082 7.4400 3/1/28 Actual/360
64 Various GA Various 9,800,000 9,717,397 7.9500 12/1/07 Actual/360
65 Jacksonville FL 32224 9,700,000 9,687,496 7.4700 3/1/28 Actual/360
67 Stockton CA 95202 9,600,000 9,565,039 7.3750 12/1/07 Actual/360
68 Salt Lake City UT 84104 9,530,000 9,530,000 8.1400 7/1/07 Actual/360
69 Allen Park MI 48101 9,300,000 9,265,237 7.3400 2/1/13 Actual/360
71 Tustin CA 92780 9,250,000 9,242,654 7.1600 4/1/11 Actual/360
72 Various GA Various 9,250,000 9,237,004 7.1250 3/1/08 Actual/360
76 Bergenfield NJ 07621 9,150,000 9,136,906 7.0500 3/1/08 Actual/360
78 Bronx NY 10469 9,000,000 8,951,209 7.8900 2/1/18 Actual/360
82 Edison NJ 08817 8,200,000 8,174,179 7.2500 1/1/13 Actual/360
85 Tuscon AZ 85705 7,983,000 7,983,000 8.1400 7/1/07 Actual/360
90 Pineville NC 28134 7,800,000 7,766,189 7.8750 1/1/08 Actual/360
93 Columbus OH 43235 7,600,000 7,589,517 7.2000 3/1/08 Actual/360
94 Augusta GA 30909 7,600,000 7,579,696 7.0000 2/1/08 Actual/360
95 Charlotte NC 28269 7,400,000 7,400,000 7.1000 5/1/18 Actual/360
96 Portland OR 97266 7,400,000 7,377,559 7.4400 1/1/08 Actual/360
105 Glen Allen VA 23060 7,000,000 7,000,000 7.3500 5/1/13 Actual/360
109 Jersey City NJ 07302 6,900,000 6,900,000 7.0600 5/1/28 Actual/360
121 Bradenton FL 34209 6,600,000 6,592,324 7.3750 4/1/08 Actual/360
126 Charlotte NC 28204 6,600,000 6,555,556 7.5000 11/1/07 Actual/360
127 Carrboro NC 27510 6,552,000 6,547,029 7.3900 4/1/28 Actual/360
128 Lynchburg VA 24504 6,500,000 6,493,025 7.8750 4/1/08 Actual/360
129 Oceanside CA 92056 6,500,000 6,474,752 7.0700 2/1/23 Actual/360
132 Louisburg NC 27549 6,400,000 6,395,007 7.2500 4/1/18 Actual/360
133 Millville NJ 08332 6,400,000 6,381,293 7.6250 1/1/08 Actual/360
134 Silver Spring MD 20910 6,375,000 6,350,418 7.1100 12/1/12 Actual/360
138 Keyport NJ 07735 6,300,000 6,294,962 7.1250 4/1/13 Actual/360
139 Summit NJ 07836 6,300,000 6,276,579 7.2800 12/1/27 Actual/360
141 Olney MD 20832 6,250,000 6,244,629 6.7600 4/1/14 Actual/360
142 Sunrise FL 33304 6,200,000 6,200,000 7.3000 1/1/09 Actual/360
146 Brooklyn NY 11217 6,150,000 6,123,873 8.0000 1/1/08 Actual/360
147 Chardon OH 44024 6,100,000 6,077,176 7.2500 12/1/07 Actual/360
150 Menominee MI 49858 6,000,000 5,989,330 7.6250 4/1/08 Actual/360
153 Vernon CT 06066 6,000,000 5,982,462 7.6250 1/1/08 Actual/360
158 South River NJ 08882 5,800,000 5,784,399 6.9600 2/1/28 Actual/360
163 Romulus MI 48174 5,700,000 5,678,694 7.3400 2/1/13 Actual/360
167 Bethlehem PA 18018 5,500,000 5,493,855 7.6250 4/1/13 Actual/360
168 Longview TX 75605 5,486,000 5,486,000 8.1400 7/1/07 Actual/360
</TABLE>
<PAGE>
Exhibit I - XVI Loans where interest is calculatd on Actual/360
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
First
Union
Prosup # Control # Property Name Address
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
169 58 Warehouse Specialists - Enterprise Park 3.5, 4, 5 8511-8555 Martin Drive
170 60 Grand Central Station Shopping Center 8756 Research Blvd
171 222 Ramada Inn Newburgh 1055 Union Avenue
173 59 Beacon Mill Village 2 Main Street
175 226 La Maison 2308 & 2408 Houma Blvd
176 223 Connecticut Avenue Days Inn 4400 Connecticut Avenue, NW
177 317 Dill Creek Commons Shopping Center 1360 West Wade Hampton Blvd.
180 62 Hampton Inn - Matthews 9615 Independence Point Parkway
181 61 Cambridge House 250 Bellbrook Avenue
184 225 Hearthside 8214 Wilson Drive
185 63 Hampton Inn - Concord 612 Dicken Place
192 66 Kelly House 106 St. Philip Street
195 68 Hampton Inn - Gatlinburg, TN 967 Parkway
197 67 Agoura Hills Town Center 30105-30135 Agoura Road
198 69 Foxhill Apartments 1900 South Missouri Street
203 228 K&K Warehousing - 3100 Woleske Rd 3100 Woleske Road
211 71 Fairfield Inn Shreveport 6245 Westport Avenue
213 72 Oxford Point 106 Old Lincoln Highway
218 233 Sunnyview 4502 Sunnyview Drive
222 236 Seminary Place Shopping Center 9440-9524 Georgia Avenue
223 73 Vernon Gardens 695 Talcottville Road
228 235 Ramada Inn & Suites 1410 South Country Club Drive
238 230 Hunters Crossing 2801 Bill Owens Parkway
239 239 54-57 South Street 54-57 South Street
240 321 Hansen Village Apartments 11821 Foothill Boulevard
244 74 Milestone Hopewell Road
246 75 Arnold Industrial Park 1361 Airport Road North
247 76 Derby Ridge 67 Blue Stone Court
250 80 Superstition Marketplace 1155 South Power Road
251 78 Blue Grass Plaza 2417 Welsh Road (PA 532)
254 81 Village Green 1000-1013 Village Green, 1005-1013 Milan Drive
255 79 Spartan Square Shopping Center 1435-1499 W. Main St.
270 238 Village South 1243 Bay Area Blvd
275 242 Covington Square 4828 Zenith Street
278 84 Grand Manor Nursing and Rehab Center 3645 Cook Avenue
281 83 Amerihost Inn- Players 203 Front Street
283 87 Metro Plaza 1407-1411 East-West Hgwy & 8397-8399 Colesville Rd
286 86 Forestwood On the Creek Apts. 9601 Forest Lane
288 88 Westbrook 3463-3560 53rd Ave
291 333 Treetops Terace Condominiums 93-116 Tree Top Court
292 90 Estero Woods Village 22770 South Tamiami Trail
294 91 Warehouse Specialists - Fond Du Lac II 170 W. Larsen Drive
297 92 Buck Run/Timberline Condominiums 4689 Buck Run Square
305 305 2-32 Brighton & 1101-1113 Commonwealth 2-32 Brighton & 1101-1113 Commonwealth
308 93 South Brook 5101 Linbar Drive
311 95 Pinnacle 7131 Pinnacle Drive
313 94 Access Self Storage of Wayne 575 Route 23
318 97 Grandview 1319 E. 45th Street
321 98 9031 Snowden Square Drive 9031 Snowden Square Drive
342 101 Chancellor Care Center of Delmar 101 E. Delaware Avenue
346 102 Northfield Lodge 603 East Northfield Boulevard
349 254 Village Plaza of Margate 1360-1456 N. State Rd. 7
351 103 Pheasant Glen 447 West Clinton Avenue
354 104 Old Country Plaza 3940 Plank Road Road
360 106 Warehouse Specialists - Stevens Point I & II 4400 Industrial Park Rd. & 2557 Leahy Court
362 107 Littleton Lyne 119-125 Littleton Road
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Original Cut-off date Mortgage Maturity Accrual
Prosup # City State Zip Code Balance Balance Rate Date Method
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
169 Clayton WI 54956 5,500,000 5,467,636 7.4375 3/1/13 Actual/360
170 Austin TX 78758 5,415,000 5,394,497 7.3750 1/1/08 Actual/360
171 Newburgh NY 12550 5,400,000 5,394,206 7.8750 4/1/08 Actual/360
173 Beacon Falls CT 06403 5,400,000 5,377,346 7.6250 11/1/27 Actual/360
175 Metairie LA 70001 5,360,000 5,355,528 6.9100 4/1/08 Actual/360
176 Washington DC 20008 5,350,000 5,350,000 7.5000 5/1/08 Actual/360
177 Greer SC 29650 5,390,000 5,349,732 7.3000 1/1/18 Actual/360
180 Matthews NC 28105 5,300,000 5,277,026 7.8750 1/1/08 Actual/360
181 Bristol TN 37620 5,300,000 5,271,219 7.8750 2/1/18 Actual/360
184 Ralston NE 68127 5,120,000 5,120,000 6.8750 5/1/08 Actual/360
185 Concord NC 28025 5,100,000 5,077,893 7.8750 1/1/08 Actual/360
192 Charleston SC 29403 4,921,000 4,907,580 6.8800 2/1/08 Actual/360
195 Gatlinburg TN 37738 4,875,000 4,865,111 7.6250 3/1/08 Actual/360
197 Agoura Hills CA 91301 4,875,000 4,850,614 7.8750 11/1/07 Actual/360
198 Casper WY 82609 4,800,000 4,787,973 7.3750 2/1/08 Actual/360
203 Marinette WI 54153 4,600,000 4,591,820 7.6250 4/1/08 Actual/360
211 Shreveport LA 71129 4,500,000 4,483,464 7.4600 2/1/08 Actual/360
213 Falls Township PA 19030 4,494,266 4,479,384 8.1300 11/1/07 Actual/360
218 Oklahoma City OK 73135 4,360,000 4,356,682 7.3750 4/1/08 Actual/360
222 Silver Spring MD 20901 4,200,000 4,191,650 6.7100 4/1/18 Actual/360
223 Vernon CT 06066 4,200,000 4,188,586 6.9000 2/1/13 Actual/360
228 Mesa AZ 85210 4,150,000 4,145,337 7.5900 4/1/18 Actual/360
238 Longview TX 75605 4,080,000 4,076,596 6.9100 4/1/08 Actual/360
239 Morristown NJ 07016 4,000,000 4,000,000 7.3750 5/1/08 Actual/360
240 Lake View Terrace CA 91342 4,000,000 3,996,904 7.2900 4/1/08 Actual/360
244 Williamsport MD 21795 3,975,000 3,956,704 7.5000 1/1/23 Actual/360
246 Naples FL 34104 3,940,000 3,925,346 7.3750 2/1/08 Actual/360
247 Lakeside Park KY 41017 3,900,000 3,888,336 7.5100 1/1/08 Actual/360
250 Mesa AZ 85206 3,800,000 3,800,000 7.2500 2/1/13 Actual/360
251 Philadelphia PA 19114 3,800,000 3,793,245 7.1000 3/1/08 Actual/360
254 Norfolk NE 68701 3,800,000 3,787,736 7.1250 1/1/08 Actual/360
255 Salem VA 24523 3,800,000 3,785,732 6.8000 3/1/18 Actual/360
270 Clear Lake City TX 77058 3,580,000 3,577,013 6.9100 4/1/08 Actual/360
275 Metairie LA 70001 3,480,000 3,477,096 6.9100 4/1/08 Actual/360
278 St Louis MO 63113 3,450,000 3,435,045 7.8750 1/1/13 Actual/360
281 Metroplois IL 62960 3,450,000 3,419,680 7.6250 12/1/17 Actual/360
283 Silver Spring MD 20910 3,400,000 3,394,966 6.9100 3/1/13 Actual/360
286 Dallas TX 75243 3,400,000 3,389,912 7.5500 1/1/08 Actual/360
288 Columbus NE 68601 3,396,000 3,385,040 7.1250 1/1/08 Actual/360
291 Blommingdale NJ 07403 3,350,000 3,350,000 7.2500 5/1/13 Actual/360
292 Estero FL 33928 3,360,000 3,349,273 7.1800 1/1/05 Actual/360
294 Fond Du Lac WI 54935 3,350,000 3,330,287 7.4375 3/1/13 Actual/360
297 Roanoke VA 24014 3,300,000 3,295,363 7.1250 3/1/08 Actual/360
305 Boston MA 02215 3,250,000 3,246,220 7.3750 4/1/08 Actual/360
308 Nashville TN 37211 3,225,000 3,213,140 7.3300 12/1/12 Actual/360
311 Ft. Myers FL 33907 3,200,000 3,191,724 7.1900 2/1/08 Actual/360
313 Wayne Township NJ 07470 3,200,000 3,188,308 7.5000 2/1/08 Actual/360
318 Kearny NE 68847 3,154,000 3,143,821 7.1250 1/1/08 Actual/360
321 Columbia MD 21045 3,150,000 3,117,578 7.8750 11/1/17 Actual/360
342 Delmar DE 19940 2,960,000 2,944,904 8.0000 12/1/07 Actual/360
346 Murfreesboro TN 37130 2,908,000 2,897,306 7.3300 12/1/12 Actual/360
349 Margate FL 33063 2,850,000 2,843,054 7.5000 4/1/15 Actual/360
351 State College PA 16803 2,822,000 2,815,366 8.7000 1/1/23 Actual/360
354 Fredericksburg VA 22407 2,800,000 2,778,954 7.2500 1/1/18 Actual/360
360 Stevens Point WI 54481 2,700,000 2,684,112 7.4375 3/1/13 Actual/360
362 Ayer MA 01432 2,670,000 2,656,383 8.0000 12/1/07 Actual/360
</TABLE>
<PAGE>
Exhibit I - XVI Loans where interest is calculatd on Actual/360
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
First
Union
Prosup # Control # Property Name Address
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
364 108 Auburn Blvd Mini Storage 6230 Auburn Blvd
365 109 Springs Office Building 2101 West State Road 434
373 110 Linda Granada 16600 San Fernanado Mission
374 320 633 Building 633 Germantown Pike
375 111 Shoreline View Alzheimer Care Center 9324 North Harborview Drive
377 263 Cobblestone Village 1237-1263 North Riverside Av.
381 112 Amerihost Inn - Hammond 7813 Indianapolis Boulevard
382 113 Holiday Inn Express - Albany, GA 911 East Oglethorpe Blvd.
385 115 Southgate Village Life Care Center 4101 SW Martin Drive
387 116 Kushner Seiden Madison 64th LP 26 East 64th Street
389 117 Stor-It Rental Storage 1435 Malad Street
391 118 Best Western - Dunn 603 Spring Branch Road
395 124 Tuscany Village Phase I 235 Ocala
396 120 Concord Village West 137-A West Concord Drive
398 121 Days Inn - Forest Park 5116 Highway 85
399 123 Tech Center 300 Kimberton Road
400 119 Amerihost Inn - Parkersburg 401 37th Street
401 125 Comfort Inn - Gaffney, SC 143 Corona Drive
402 265 Food Pavilion 1000 West 4th Avenue
404 126 Keep It Self Storage - Santa Clarita 25333 San Fernando Road
405 128 Country Creek 398 Bethel Avenue
407 311 Willow Trace Apartments 8100 Pines Road
413 132 Warehouse Specialists - Specialists Ave # 1-4 720 - 772 Specialists Avenue
415 272 Inn of Payson 801 North Beeline Highway
417 257 Val Halla 1224 Lake Avenue
421 309 Plantation House 2625 Hudnell Street
424 271 Comfort Inn - Franklin 4206 Franklin Commons Court
430 134 1212-1216 Broadway 1212-1216 Broadway
440 138 The Manors Apartments 985 Manor Drive
443 273 Antelope Valley Mall 1201 W Avenue P
444 269 Chateau Imperial 3000-3320 Parklane Drive
452 267 Villa d'Venus 3124 Lake Villa Drive
453 274 Eckerd Drugs State Route 211 and Blumel Road
456 270 Best Western St. Augustine 2445 State Road 16
457 142 Nalley Valley Self Storage 2201 S. Tacoma Way
461 141 Days Inn/Kingsland 1050 East King Avenue
462 143 P Street 1743 P Street
465 275 Woodway Apartments 2895 Dorthy Jeanie Drive
470 145 Best Western Statesville 1121 Morland Drive
486 151 Newtonian Gardens 70 West End Avenue
489 150 Bella Mar 825 Ocean Avenue
490 148 Amerihost Inn - Macomb 1646 North Lafayette
491 149 Amerihost Inn-Lancaster 1721 River Valley Circle North
492 152 Amerihost Inn - Logan 12819 State Road 664
493 153 Amerihost Inn- Jeffersonville 11431 Allen Road NW
497 279 Lobo Canyon Shopping Center 700 East Roosevelt Ave.
499 158 Saint Charles Place 2199 Southwest 81st Ave.
503 157 Keep it Self Storage - Van Nuys 6827 Woodley Avenue
505 155 421 Germantown Pike 421 Germantown Pike
507 156 Amerihost Inn-Sycamore 1475 South Peace Rd.
514 160 Crestwood Apartments 1428 Raymond Street
522 161 Warehouse Specialists - 1097 Ehlers Road 1097 Ehlers Road
528 162 395-435 East O'Keefe Street 395-435 East O'Keefe Street
534 281 Fairmount Apartments 345-57 W. Johnson Streets
552 169 North Creek Townhomes 515- 112th ST. S.E.
556 284 Henderson Mall 675 Mall Ring Circle
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Original Cut-off date Mortgage Maturity Accrual
Prosup # City State Zip Code Balance Balance Rate Date Method
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
364 Citrus Heights CA 95621 2,650,000 2,639,794 7.1300 2/1/08 Actual/360
365 Altomonta Springs/Longwood FL 32714 2,650,000 2,639,787 7.1250 2/1/08 Actual/360
373 Granda Hills CA 91344 2,550,000 2,542,687 7.7200 1/1/08 Actual/360
374 Plymouth Meeting PA 19401 2,550,000 2,540,683 7.5000 2/1/08 Actual/360
375 Gig Harbor WA 98332 2,550,000 2,538,946 7.8750 1/1/08 Actual/360
377 Medford OR 97501 2,500,000 2,500,000 7.2500 5/1/08 Actual/360
381 Hammond IN 46324 2,500,000 2,481,770 7.5000 1/1/18 Actual/360
382 Albany GA 31705 2,500,000 2,479,064 8.0000 12/1/17 Actual/360
385 Topeka KS 66612 2,475,000 2,464,054 7.7500 1/1/08 Actual/360
387 New York NY 10021 2,460,000 2,453,681 7.2300 2/1/28 Actual/360
389 Boise ID 83705 2,460,000 2,447,179 7.8750 12/1/12 Actual/360
391 Dunn NC 28334 2,450,000 2,416,636 8.6250 12/1/12 Actual/360
395 Tallahassee FL 32304 2,400,000 2,392,627 7.3750 1/1/08 Actual/360
396 Clarksvile TN 37042 2,400,000 2,391,174 7.3300 12/1/12 Actual/360
398 Forest Park GA 30050 2,400,000 2,382,514 8.8750 11/1/07 Actual/360
399 Phoenixville PA 19460 2,400,000 2,382,500 7.5000 1/1/08 Actual/360
400 Parkersburg WV 26101 2,400,000 2,378,908 7.6250 12/1/17 Actual/360
401 Gaffney SC 29341 2,380,000 2,360,069 8.0000 12/1/17 Actual/360
402 Kennewick WA 99336 2,345,000 2,343,112 7.0900 4/1/08 Actual/360
404 Santa Clarita CA 91350 2,350,000 2,339,389 7.6200 1/1/18 Actual/360
405 Sanger CA 93757 2,334,000 2,326,172 7.7500 12/1/12 Actual/360
407 Shreveport LA 71129 2,322,000 2,322,000 8.1400 7/1/07 Actual/360
413 Menasha WI 54956 2,275,000 2,261,613 7.4375 3/1/13 Actual/360
415 Payson AZ 85541 2,250,000 2,247,472 7.5900 4/1/18 Actual/360
417 Metairie LA 70002 2,224,000 2,222,177 7.0000 4/1/08 Actual/360
421 Dallas TX 75235 2,200,000 2,200,000 8.1400 7/1/07 Actual/360
424 Franklin TN 37064 2,200,000 2,196,877 7.8750 4/1/13 Actual/360
430 New York NY 10001 2,200,000 2,189,022 8.1250 12/1/07 Actual/360
440 Palm Springs FL 33461 2,150,000 2,142,587 7.6250 12/1/07 Actual/360
443 Palmdale CA 93551 2,125,000 2,125,000 7.2100 5/1/08 Actual/360
444 Hastings NE 68901 2,120,000 2,120,000 6.8750 5/1/08 Actual/360
452 Metairie LA 70002 2,100,000 2,098,248 6.9100 4/1/08 Actual/360
453 Wallkill NY 10941 2,100,000 2,098,030 7.3750 4/1/08 Actual/360
456 St. Augustine FL 32092 2,100,000 2,096,490 8.1250 4/1/18 Actual/360
457 Tacoma WA 98409 2,100,000 2,095,512 7.3500 3/1/18 Actual/360
461 Kingsland GA 31548 2,100,000 2,093,197 7.8750 3/1/18 Actual/360
462 Washington DC 20036 2,100,000 2,092,352 7.3750 12/1/07 Actual/360
465 Fayetteville AR 72704 2,080,000 2,078,377 7.2500 4/1/08 Actual/360
470 Statesville NC 28677 2,080,000 2,051,020 8.3750 12/1/12 Actual/360
486 Newton NJ 07860 1,950,000 1,945,508 7.8700 2/1/08 Actual/360
489 Santa Monica CA 90403 1,950,000 1,941,881 8.1250 1/1/08 Actual/360
490 Macomb IL 61455 1,950,000 1,932,863 7.6250 12/1/17 Actual/360
491 Lancaster OH 43130 1,950,000 1,932,863 7.6250 12/1/17 Actual/360
492 Logan OH 43138 1,925,000 1,908,082 7.6250 12/1/17 Actual/360
493 Octa OH 43128 1,925,000 1,908,082 7.6250 12/1/17 Actual/360
497 Grants NM 87020 1,900,000 1,897,834 7.5000 4/1/08 Actual/360
499 Miramar FL 33025 1,900,000 1,894,978 7.0625 2/1/08 Actual/360
503 Van Nuys CA 91406 1,900,000 1,891,489 7.6700 1/1/18 Actual/360
505 Plymouth Meeting PA 19462 1,900,000 1,891,079 7.3750 1/1/08 Actual/360
507 Sycamore IL 60178 1,900,000 1,883,302 7.6250 12/1/17 Actual/360
514 Boise ID 83701 1,820,000 1,817,376 7.0200 3/1/08 Actual/360
522 Menasha WI 54956 1,775,000 1,764,555 7.4375 3/1/13 Actual/360
528 East Palo Alto CA 94303 1,746,000 1,741,531 7.2500 2/1/08 Actual/360
534 Philadelphia PA 19144 1,700,000 1,697,943 7.1250 4/1/08 Actual/360
552 Everett WA 98208 1,600,000 1,594,882 7.1700 1/1/08 Actual/360
556 Henderson NV 89014 1,575,000 1,575,000 7.2100 5/1/08 Actual/360
</TABLE>
<PAGE>
Exhibit I - XVI Loans where interest is calculatd on Actual/360
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
First
Union
Prosup # Control # Property Name Address
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
557 171 Anchor Self Storage - Glendora 700 E. Acosta
561 172 Warehouse Specialists - Harrison Street 2440 Harrison Street
565 304 New Hampshire Apartments 345 South New Hampshire St.
567 173 Briarcliff 4314 Commomwealth Ave, A-1
580 175 Revco Drug Store 2939 The Plaza Road
587 176 Glynbrook Estates 3642 Glynbrook Avenue
588 289 Cypress Winds 2105 Cleary
595 177 Camelot and Circle Inn Mobile Home Parks 330 W. Chubbuck Rd. and 210 Circle Inn St.
601 179 Warehouse Specialists - 1286 Ehlers Road 1286 Ehlers Road
602 180 Warehouse Specialists - Dixie Street 356 Dixie Street
615 182 Kings Tree Apartments 1800 Kingsley Avenue
622 183 Carey Hill Plaza 220 E. Ashland Street
624 184 Warehouse Specialists - Bell Street 555 Bell Street
625 185 Warehouse Specialists - Combined Locks 100 West Prospect Street
627 186 Williamstown Bay 4809 Dale Street
628 187 52 Liberty Street 52 Liberty Street
629 336 Highview Apartments 930-934 Greenbriar Drive and 1024 Hillcrest Drive
630 188 Kingwood 118 Kingwood Drive
643 189 19-25 Brighton Avenue 19-25 Brighton Avenue
646 190 Crates shopping center 14 North Bridge Avenue
649 192 Ruffolo Plaza 9701-9711 West Sample Road
650 298 Continental House 4318 South 25th Street
661 299 Monmouth Beach Village 108 South Cookman Avenue
664 300 Washington Place 944 Old Washington Road
667 196 Commerce Square Shopping Center 203 Commerce Avenue
669 197 Magnolia 2100 River View Rd.
671 198 Creamery Hills 355 Creamery Road
673 302 Wells Court 1856 Wells Drive
674 199 Logan Square Shopping Center SWC of Logan Drive and Memorial Parkway (Highway 231)
675 200 2486 Morris Avenue 2486 Morris Avenue
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
Original Cut-off date Mortgage Maturity Accrual
Prosup # City State Zip Code Balance Balance Rate Date Method
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
557 Glendora CA 91740 1,560,000 1,556,622 7.2800 3/1/08 Actual/360
561 Neenah WI 54956 1,550,000 1,540,879 7.4375 3/1/13 Actual/360
565 Los Angeles CA 90020 1,500,000 1,498,839 7.2900 4/1/05 Actual/360
567 Charlotte NC 28205 1,500,000 1,493,243 7.6350 1/1/23 Actual/360
580 Charlotte NC 28205 1,424,000 1,420,432 7.3750 2/1/08 Actual/360
587 Keizer OR 97303 1,400,000 1,395,039 7.5000 12/1/07 Actual/360
588 Metairie LA 70002 1,392,000 1,390,839 6.9100 4/1/08 Actual/360
595 Chubbuck ID 83202 1,350,000 1,345,749 7.2500 1/1/08 Actual/360
601 Neenah WI 54956 1,300,000 1,292,350 7.4375 3/1/13 Actual/360
602 Fond Du Lac WI 54935 1,300,000 1,292,350 7.4375 3/1/13 Actual/360
615 Orange Park FL 32073 1,200,000 1,196,993 7.3750 2/1/08 Actual/360
622 Brockton MA 02402 1,125,000 1,120,962 7.6250 2/1/08 Actual/360
624 Neenah WI 54956 1,100,000 1,093,527 7.4375 3/1/13 Actual/360
625 Combined Locks WI 54113 1,100,000 1,093,527 7.4375 3/1/13 Actual/360
627 McFarland WI 53558 1,077,000 1,074,983 9.1100 2/1/23 Actual/360
628 Kearny NJ 07032 1,068,000 1,064,955 7.7500 1/1/08 Actual/360
629 DeKalb IL 60115 1,060,000 1,060,000 7.2500 5/1/08 Actual/360
630 Murfreesboro TN 37130 1,063,000 1,059,091 7.3300 12/1/12 Actual/360
643 Allston MA 02134 990,000 989,228 7.2500 4/1/08 Actual/360
646 Redbank NJ 07701 960,000 958,970 7.8750 4/1/13 Actual/360
649 Coral Springs FL 33065 938,000 933,852 7.7500 1/1/08 Actual/360
650 Omaha NE 68107 930,000 930,000 6.8750 5/1/08 Actual/360
661 Long Branch NJ 07740 780,000 780,000 6.9600 5/1/28 Actual/360
664 Thomson GA 30824 765,000 764,538 8.5200 4/1/23 Actual/360
667 La Grange GA 30240 750,000 747,308 7.6250 2/1/08 Actual/360
669 Tunica MS 38646 725,000 722,827 8.2500 12/1/07 Actual/360
671 Harford NY 13784 608,000 606,232 7.6500 1/1/28 Actual/360
673 Atlanta GA 30311 490,000 490,000 7.5000 5/1/23 Actual/360
674 Huntsville AL 35802 450,000 448,385 7.6250 2/1/08 Actual/360
675 Bronx NY 10468 440,000 438,203 7.7500 11/1/07 Actual/360
</TABLE>
<PAGE>
EXHIBIT I-XXVI
Exceptions to Clause (xxvi) of Schedule I
- --------------------------------------------------------------------------------
Pro Sup # First Union Property Name Property Address City/State
Control #
- --------------------------------------------------------------------------------
673 302 Wells Court 1856 Wells Drive Atlanta, GA
- --------------------------------------------------------------------------------
<PAGE>
EXHIBIT I-XXXVII
Exceptions to Clause (xxvii) of Schedule I
Five Brinkers
<PAGE>
EXHIBIT I-XXXI
Exceptions to Clause (xxxi) of Schedule I
None
<PAGE>
EXHIBIT I-XL
Exceptions to Clause (xl) of Schedule I
None
<PAGE>
EXHIBIT I-XLII
Exceptions to Clause (xlii) of Schedule I*
* The referenced Loans are either newly constructed or have been substantially
renovated within the last 18 months.
<PAGE>
Exhibit I - XLII Loans with no engineering report within the last 18 months
<TABLE>
<CAPTION>
First Union
Control
ProSup ID # Number Property Name Address
<S> <C> <C> <C>
28 10 Peachtree Walk 1074-1075 Peachtree Walk
23f 7.1 Macaroni Grill - Store #37 1670 W. I-20
23a 7.2 On The Border - Store #16 1121 I-20 West
23b 7.3 Macaroni Grill - Store #131 5133 S. Padre Island Dr.
23e 7.4 Chili's - Store #332 7621 F.M. 1960
23d 7.5 On The Border - Store #17 1890 S. Stemmon Frwy.
23g 7.7 Chili's - Store #520 5025 E. 42nd St.
23c 7.8 On The Border - Store #50 4301 S. Broadway
23h 7.9 Chili's - Store #272 3710 Call Field Dr.
24 8 Brinker Trust 9 6700-6750 LBJ Freeway
39 17 The Plantation at Lafayette 211 Liberty Ave.
55b 23.1 On The Border - Store #24 8555 S. Quebec St.
55e 23.3 Chili's - Store #256 2107 N. Veterans Pkwy.
55d 23.4 Chili's - Store #523 301 Constitution
55c 23.5 Chili's - Store #364 3030 S. Glenstone
55f 23.6 Chili's - Store #421 3580 Broadway
57 24 Northwind 1680 Sky Mountain Road
56e 25.1 Chili's - Store #404 9610 Hwy 5
56d 25.2 Chili's - Store #500 2319 Iowa St.
56b 25.3 Macaroni Grill - Store #84 2572 Citiplace Court
56a 25.4 Macaroni Grill - Store #53 39300 Seven Mile Rd.
56f 25.5 Chili's - Store #314 1388 Kildaire Farm Rd.
56c 25.6 On The Border - Store #40 8101 Giacosa Dr.
58a 26.1 Macaroni Grill - Store #50 11100 West Markham
58c 26.2 Chili's - Store #470 1706 E. Cheyenne Mountain Rd.
58f 26.3 Chili's - Store #329 1161 Old Salem Rd.
58b 26.5 Macaroni Grill - Store #115 740 SE Maynard Rd.
96 41 Scott Mountain by the Brook 7828 SE Aspen Summit Drive
142 49 United HealthCare Office Bldg 13621 NW 12th Street
256 77 Winn Dixie Eustis 1951 State Road 19 North
283 87 Metro Plaza 1407-1411 East-West Hgwy &
8397-8399 Colesville Rd
290 89 Staples Hazelton 180 Susquehanna Boulevard
320 99 Pep Boys Union 2525 U.S. Highway 22
332 100 Safeway Milton Freewater 455 North Columbia St.
351 103 Pheasant Glen 447 West Clinton Avenue
356 105 Walgreen Miami 9675 Northwest 41st Street
386 114 Walgreen Houston 10850 Scarsdale Boulevard
433 135 Eckerd Ventnor 6701 Ventnor Avenue
438 136 Rite Aid Roanoke 1168 Peters Creek Road
447 140 Eckerd Winslow S.W. Willaimstown - New Freedom Road
467 144 Eckerd Wildwood 4201 Atlantic Ave.
478 146 Eckerd Oviedo Mitchell Hammock & Lockwood
495 154 CVS Brazil SEC Forest Ave & National Ave
539 163 State Farm Cranford 70 Myrtle Street
538 164 CVS Tipton 711 East Jefferson St
541 165 CVS York 820 Edgewood Road
546 166 CVS Rockville NWC US 36 & SR 41
547 167 CVS Edinburgh NEC US 31 & Eisenhower Rd
580 175 Revco Drug Store 2939 The Plaza Road
671 198 Creamery Hills 355 Creamery Road
141 217 Shoppes of Olney 3110-3134 Olney Sandy Spring Road
345 256 Walgreen Lafayette SEC 18TH Street and State Road 26
576 287 CVS Aiken Whiskey Rd & Shannon Lane
573 288 IHOP Kannapolis 800 Cloverleaf Plaza
592 292 IHOP Gastonia 500 Cox Road
604 296 IHOP Wilmington 5355 Market Street
664 300 Washington Place 944 Old Washington Road
673 302 Wells Court 1856 Wells Drive
126 315 The Addison 831 E. Morehead St.
177 317 Dill Creek Commons Shopping Center 1360 West Wade Hampton Blvd.
41 319 Woodholme Medical Building 1838 Greene Tree Road
487 326 Rite Aid Gaylord 419 Main Street
653 327 Sunbelt Newport News 745 Industrial Park Drive
333 328 Rite Aid Portage Westnedge Avenue and Kilgore Road
23 7 Brinker Trust 11 Various
55 23 Brinker Trust 5 0
56 25 Brinker Trust 7 Various
58 26 Brinker Trust 2 Various
<CAPTION>
ProSup ID # City State Zip Code
<S> <C> <C> <C>
28 Atlanta GA 30309
23f Arlington TX 76017
23a Arlington TX 76017
23b Corpus Christie TX 78411
23e Houston TX 77070
23d Lewisville TX 75067
23g Odessa TX 79762
23c Tyler TX 75703
23h Witchita Falls TX 78603
24 Dallas TX 75240
39 Lafayette LA 70508
55b Highlands Ranch CO 80126
55e Bloomington IL 61704
55d W. Monroe LA 71292
55c Springfield MO 65804
55f Edmond OK 73013
57 Reno NV 89503
56e Douglasville GA 30135
56d Lawrence KS 66046
56b Baton Rouge LA 70808
56a Livonia MI 48152
56f Cary NC 27511
56c Memphis TN 38133
58a Little Rock AR 72211
58c Colorado Springs CO 80906
58f Conyers GA 30207
58b Cary NC 27511
96 Portland OR 97266
142 Sunrise FL 33304
256 Eustis FL 32726
283 Silver Spring MD 20910
290 West Hazelton PA 18201
320 Union Township NJ 7083
332 Milton Freewater OR 98762
351 State College PA 16803
356 Miami FL 33178
386 Houston TX 77089
433 Ventnor City NJ 8408
438 Roanoke VA 24017
447 Winslow Township NJ 8095
467 Wildwood NJ 8260
478 Oveido FL 32765
495 Brazil IN 47834
539 Cranford NJ 7016
538 Tipton IN 46072
541 York PA 17402
546 Rockville IN 47872
547 Edinburgh IN 46124
580 Charlotte NC 28205
671 Harford NY 13784
141 Olney MD 20832
345 Lafayette IN 47905
576 Aiken SC 29803
573 Kannapolis NC 28083
592 Gastonia NC 28054
604 Wilmington NC 28405
664 Thomson GA 30824
673 Atlanta GA 30311
126 Charlotte NC 28204
177 Greer SC 0
41 Baltimore Maryland 21208
487 Gaylord MI 49735
653 Newport News VA 23608
333 Portage MI 49081
23 Various TX 0
55 0 GA 0
56 Various Various 0
58 Various Various 0
</TABLE>
<PAGE>
EXHIBIT II-A
Exception to Clause (A) of Schedule II
None
<PAGE>
EXHIBIT II-B
Exceptions to Clause (B) of Schedule II
None
<PAGE>
EXHIBIT II-J
Exceptions to Clause (J) of Schedule II
None
<PAGE>
EXHIBIT II-L
Exceptions to Clause (L) of Schedule II
None
<PAGE>
EXHIBIT IV-A
Exceptions to Clause (A) of Schedule IV
- --------------------------------------------------------------------------------
Pro Sup # First Union Property Name Property Address City/State
Control #
- --------------------------------------------------------------------------------
539 163 State Farm - 70 Myrtle Ave Cranford, NJ
Cranford
- --------------------------------------------------------------------------------
315 96 Winn Dixie - 111 Independence Morganton, NC
Morganton Blvd
- --------------------------------------------------------------------------------
<PAGE>
EXHIBIT IV-B
Exceptions to Clause (B) of Schedule IV
<PAGE>
EXHIBIT IV - B
<TABLE>
<CAPTION>
First Union
Control # ProSup# Property Name Property Address City State
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
154 495 CVS - Brazil SEC Forest Ave & National Ave Brazil IN
167 547 CVS - Edinburgh NEC US 31 & Eisenhower Rd Edinburgh IN
166 546 CVS - Rockville NWC US 36 & SR 41 Rockville IN
164 538 CVS - Tipton 711 East Jefferson St Tipton IN
165 541 CVS - York 820 Edgewood Road York PA
170 550 CVS - Greece 3750 ML Read Boulevard Greece NY
295 605 Eckerd - Kernersville SEC Nelson St & Piney Grove Rd Kernersville NC
135 433 Eckerd - Ventor 6701 Ventnor Avenue Ventnor City NJ
140 447 Eckerd - Winslow S.W. Williamstown - New Freedom Road Winslow Township NJ
144 467 Eckerd - Wildwood 4201 Atlantic Ave. Wildwood NJ
181 606 Eckerd - Easley 5991 Calhoun Memorial Highway Easley SC
65 189 Kroger - Huntsville 8404 South Memorial Parkway Huntsville AL
55 159 Kroger - LaGrange 203 Commerce Avenue LaGrange GA
133 426 Office Depot SEC East Mississippi Avenue & South Potomac Street Aurora CO
326 487 Rite Aid - Gaylord 419 Main Street Gaylord MI
328 333 Rite Aid - Portage Westnedge Avenue and Kilgore Raod Portage MI
136 438 Rite Aid - Roanoke 1168 Peters Creek Road Roanoke VA
306 437 Rite Aid - Virginia Beach 324 Virginia Brach Blvd Virginia Beach VA
100 332 Safeway 455 North Columbia St. Milton Freewater OR
11 31 Shaws 50 Boston Post Road Orange CT
89 290 Staples 180 Susquehanna Boulevard West Hazelton PA
163 539 State Farm 70 Myrtle Street Cranford NJ
193 658 USPS 120 Allen Road Fallon NV
114 386 Walgreen's - Houston 10850 Scarsdale Boulevard Houston TX
127 408 Walgreen's - Coral Springs 5480 University Drive Coral Springs FL
105 356 Walgreen's - Miami 9675 Northwest 41st Street Miami FL
250 340 Walgreen's - St. John 9280 Wicker Avenue ST. John IN
256 345 Walgreen's - Lafayette SEC 18TH Street and State Road 26 Lafayette IN
131 412 Walgreen's - Chicago 1546 North Central Ave. Chicago IL
96 315 Winn Dixie - Morganton 111 Independence Boulevard Morganton NC
82 261 Winn Dixie - Orangeburg 1481 Chestnut Street Orangeburg SC
77 256 Winn Dixie - Eustis 1951 State Road 19 North Eustis FL
</TABLE>
<PAGE>
EXHIBIT IV-C
Exceptions to Clause (C) of Schedule IV
<PAGE>
Control # Pro Sup
--------- -------
Rite Aid Gaylord 326 487
Rite Aid Portage 328 333
Rite Aid Roanoke 136 438
Rite Aid VA Beach 306 437
Safeway Milton Freewater 100 332
Shaws Sainsbury 11 31
Sunbelt Newport News 327 653
Walgreens Houston 114 386
Walgreens Coral Springs 127 408
Walgreens Miami 105 356
Walgreens St. John 250 340
Walgreens Lafayette 256 345
Walgreens Chicago 131 412
Eckerd Ventor 135 433
Eckerd Winslow 140 447
Eckerd Wildwood 144 467
Eckerd Oviedo 146 478
Eckerd Easley 181 606
Eckerd Kernersville 295 605
CVS Brazil 154 495
CVS Rockville 166 546
CVS Tipton 164 538
CVS Edinburgh 167 547
CVS York 165 541
Staples Hazelton 89 290
State Farm Cranford 163 539
USPS Fallon 193 658
Winn Dixie Morganton 96 315
Winn Dixie Orangeburg 82 261
Winn Dixie Eustis 77 256
Kroger Huntsville 65 189
Kroger LaGrange 55 159
Office Depot Aurora 133 426
Eckerd Houma 139 442
Eckerd Shreveport 159 509
Eckerd Oldsmar 168 555
CVS Greece 170 550
CVS Aiken 287 576
IHOP Gastonia 292 592
IHOP Wilmington 296 604
IHOP Kannapolis 288 573
Pep Boys Union 99 320
<PAGE>
EXHIBIT IV-D
Exceptions to Clause (D) of Schedule IV
<PAGE>
Control # Pro Sup
--------- -------
Rite Aid Gaylord 326 487
Rite Aid Portage 328 333
Rite Aid Roanoke 136 438
Rite Aid VA Beach 306 437
Safeway Milton Freewater 100 332
Shaws Sainsbury 11 31
Sunbelt Newport News 327 653
Walgreens Houston 114 386
Walgreens Coral Springs 127 408
Walgreens Miami 105 356
Walgreens St. John 250 340
Walgreens Lafayette 256 345
Walgreens Chicago 131 412
Eckerd Ventor 135 433
Eckerd Winslow 140 447
Eckerd Wildwood 144 467
Eckerd Oviedo 146 478
Eckerd Easley 181 606
Eckerd Kernersville 295 605
CVS Brazil 154 495
CVS Rockville 166 546
CVS Tipton 164 538
CVS Edinburgh 167 547
CVS York 165 541
Staples Hazelton 89 290
State Farm Cranford 163 539
USPS Fallon 193 658
Winn Dixie Morganton 96 315
Winn Dixie Orangeburg 82 261
Winn Dixie Eustis 77 256
Kroger Huntsville 65 189
Kroger LaGrange 55 159
Office Depot Aurora 133 426
Eckerd Houma 139 442
Eckerd Shreveport 159 509
Eckerd Oldsmar 168 555
CVS Greece 170 550
CVS Aiken 287 576
IHOP Gastonia 292 592
IHOP Wilmington 296 604
IHOP Kannapolis 288 573
Pep Boys Union 99 320
<PAGE>
EXHIBIT IV-E
Exceptions to Clause (E) of Schedule IV
None
<PAGE>
EXHIBIT IV-G
Exceptions to Clause (G) of Schedule IV
None
<PAGE>
EXHIBIT IV-H
Exceptions to Clause (H) of Schedule IV
None
<PAGE>
EXHIBIT IV-I
Exceptions to Clause (I) of Schedule IV
None
<PAGE>
EXHIBIT IV-J
Exceptions to Clause (J) of Schedule IV
None
<PAGE>
EXHIBIT IV-L
Exceptions to Clause (L) of Schedule IV
<PAGE>
Exhibit IV - L CTL loans with Lease Guarantors
<TABLE>
<CAPTION>
Seuritizat Property
ion# Prosup # Property Name Property Address Property City State
<S> <C> <C> <C> <C> <C>
327 653 Sunbelt Newport News 745 Industrial Park Drive Newport News VA
7 23 Brinker Trust 11 Various Various TX
7.1 23f Macaroni Grill - Store #37 1670 W. I-20 Arlington TX
7.2 23a On The Border - Store #16 1121 I-20 West Arlington TX
7.3 23b Macaroni Grill - Store #131 5133 S. Padre Island Dr. Corpus Christie TX
7.4 23e Chili's - Store #332 7621 F.M. 1960 Houston TX
7.5 23d On The Border - Store #17 1890 S. Stemmon Frwy. Lewisville TX
7.6 23i Chili's - Store #326 2800 Judson Rd. Longview TX
7.7 23g Chili's - Store #520 5025 E. 42nd St. Odessa TX
7.8 23c On The Border - Store #50 4301 S. Broadway Tyler TX
7.9 23h Chili's - Store #272 3710 Call Field Dr. Witchita Falls TX
8 24 Brinker Trust 9 6700-6750 LBJ Freeway Dallas TX
23 55 Brinker Trust 5 0 0 GA
23.1 55b On The Border - Store #24 8555 S. Quebec St. Highlands Ranch CO
23.2 55a Macaroni Grill - Store #106 780 Cobb Place Blvd. Kennesaw GA
23.3 55e Chili's - Store #256 2107 N. Veterans Pkwy. Bloomington IL
23.4 55d Chili's - Store #523 301 Constitution W. Monroe LA
23.5 55c Chili's - Store #364 3030 S. Glenstone Springfield MO
23.6 55f Chili's - Store #421 3580 Broadway Edmond OK
25 56 Brinker Trust 7 Various Various Various
25.1 56e Chili's - Store #404 9610 Hwy 5 Douglasville GA
25.2 56d Chili's - Store #500 2319 Iowa St. Lawrence KS
25.3 56b Macaroni Grill - Store #84 2572 Citiplace Court Baton Rouge LA
25.4 56a Macaroni Grill - Store #53 39300 Seven Mile Rd. Livonia MI
25.5 56f Chili's - Store #314 1388 Kildaire Farm Rd. Cary NC
26 58 Brinker Trust 2 Various Various Various
26.1 58a Macaroni Grill - Store #50 11100 West Markham Little Rock AR
26.2 58c Chili's - Store #470 1706 E. Cheyenne Mountain Rd. Colorado Springs CO
26.3 58f Chili's - Store #329 1161 Old Salem Rd. Conyers GA
26.4 58d Chili's - Store #302 3795 E. Main St. St. Charles IL
26.5 58b Macaroni Grill - Store #115 740 SE Maynard Rd. Cary NC
26.6 58e Chili's - Store # 309 9009 E. 71st Street Tulsa OK
165 541 CVS York 820 Edgewood Road York PA
170 550 CVS Greece 3750 Mt. Read Boulevard Greece NY
287 576 CVS Aiken Whiskey Rd & Shannon Lane Aiken SC
288 573 IHOP Kannapolis 800 Cloverleaf Plaza Kannapolis NC
292 592 IHOP Gastonia 500 Cox Road Gastonia NC
296 604 IHOP Wilmington 5355 Market Street Wilmington NC
11 31 Shaws Sainsbury 50 Boston Post Road Orange CT
55 159 Kroger La Grange 203 Commerce Avenue LaGrange GA
65 189 Kroger Huntsville 8404 South Memorial Parkway Huntsville AL
154 495 CVS Brazil SEC Forest Ave & National Ave Brazil IN
166 546 CVS Rockville NWC US 36 & SR 41 Rockville IN
167 547 CVS Edinburgh NEC US 31 & Eisenhower Rd Edinburgh IN
164 538 CVS Tipton 711 East Jefferson St Tipton IN
328 333 Rite Aid Portage Westnedge Avenue and Kilgore Road Portage MI
326 487 Rite Aid Gaylord 419 Main Street Gaylord MI
136 438 Rite Aid Roanoke 1168 Peters Creek Road Roanoke VA
306 437 Rite Aid Virginia Beach 324 Virginia Beach Blvd Virginia Beach VA
131 412 Walgreen Chicago 1546 North Central Ave. Chicago IL
250 340 Walgreen St John 9280 Wicker Avenue St. John IN
82 261 Winn Dixie Orangeburg 1481 Chestnut Street Orangeburg SC
96 315 Winn Dixie Morganton 111 Independence Boulevard Morganton NC
<CAPTION>
Seuritizat Property General Lease
ion# Zip Code Property Type Guarntor
<S> <C> <C> <C>
327 23608 Retail Ashtead Group PLC
7 0 Restaurant Brinker International
7.1 76017 Restaurant Brinker International
7.2 76017 Restaurant Brinker International
7.3 78411 Restaurant Brinker International
7.4 77070 Restaurant Brinker International
7.5 75067 Restaurant Brinker International
7.6 75605 Restaurant Brinker International
7.7 79762 Restaurant Brinker International
7.8 75703 Restaurant Brinker International
7.9 78603 Restaurant Brinker International
8 75240 Office Brinker International
23 0 Restaurant Brinker International
23.1 80126 Restaurant Brinker International
23.2 30144 Restaurant Brinker International
23.3 61704 Restaurant Brinker International
23.4 71292 Restaurant Brinker International
23.5 65804 Restaurant Brinker International
23.6 73013 Restaurant Brinker International
25 0 Restaurant Brinker International
25.1 30135 Restaurant Brinker International
25.2 66046 Restaurant Brinker International
25.3 70808 Restaurant Brinker International
25.4 48152 Restaurant Brinker International
25.5 27511 Restaurant Brinker International
26 0 Restaurant Brinker International
26.1 72211 Restaurant Brinker International
26.2 80906 Restaurant Brinker International
26.3 30207 Restaurant Brinker International
26.4 60174 Restaurant Brinker International
26.5 27511 Restaurant Brinker International
26.6 74133 Restaurant Brinker International
165 17402 Retail CVS Corporation
170 14616 Retail CVS Corporation
287 29803 Retail CVS Corporation
288 28083 Restaurant IHOP Corp
292 28054 Restaurant IHOP Corp
296 28405 Restaurant IHOP Corp
11 44601 Retail J. Sainsbury PLC
55 30241 Retail Kroger Company
65 35801 Retail Kroger Company
154 47834 Retail Revco D.S. Inc.
166 47872 Retail Revco D.S. Inc.
167 46124 Retail Revco D.S. Inc.
164 46072 Retail Revco D.S.Inc.
328 49081 Retail Rite Aid Corp
326 49735 Retail Rite Aid Corp.
136 24017 Retail Rite Aid Corporation
306 23451 Retail Rite Aid Corporation
131 60639 Retail Walgreen Company
250 46373 Retail Walgreen Company
82 29115 Retail Winn-Dixie Stores, Inc.
96 28655 Retail Winn-Dixie Stores, Inc.
</TABLE>
<PAGE>
Exhibit 99.3
EXECUTION
MORTGAGE LOAN PURCHASE AGREEMENT
Mortgage Loan Purchase Agreement, dated as of May 1, 1998 (the
"Agreement"), between Bank of America NT&SA (the "Seller") and First Union
Commercial Mortgage Securities, Inc. (the "Purchaser").
The Seller intends to sell and the Purchaser intends to purchase
certain multifamily and commercial mortgage loans (the "Bank of America Mortgage
Loans") as provided herein. The Purchaser intends to deposit them, together with
the Other Mortgage Loans (as defined below), into a trust fund (the "Trust
Fund"), the beneficial ownership of which will be evidenced by multiple classes
(each, a "Class") of mortgage pass-through certificates (the "Certificates").
One or more "real estate mortgage investment conduit" ("REMIC") elections will
be made with respect to the Trust Fund. The Trust Fund will be created and the
Certificates will be issued pursuant to a Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement"), dated as of the Cut-off Date, among the
Purchaser as depositor, First Union National Bank as master servicer (in such
capacity, the "Master Servicer"), CRIIMI MAE Services Limited Partnership as
special servicer (in such capacity, the "Special Servicer"), and Norwest Bank
Minnesota, National Association as trustee (the "Trustee"). Concurrently with
the purchase of the Bank of America Mortgage Loans pursuant to this Agreement,
the Purchaser will also purchase certain multifamily and commercial mortgage
loans (the "Other Mortgage Loans"; and, collectively with the Bank of America
Mortgage Loans, the "Mortgage Loans") pursuant to two Mortgage Loan Purchase
Agreements, each dated as of May 1, 1998, between, in one case, First Union
National Bank and the Purchaser, and between, in the other case, Lehman Brothers
Holdings Inc., doing business as Lehman Capital, a division of Lehman Brothers
Holdings Inc. and the Purchaser. The Other Mortgage Loans will likewise be
deposited into the Trust Fund. Capitalized terms used but not defined herein
have the respective meanings set forth in the Pooling and Servicing Agreement.
Now, therefore, in consideration of the premises and the mutual
agreements set forth herein, the parties agree as follows:
SECTION 1. Agreement to Purchase.
(a) The Seller agrees to sell, and the Purchaser agrees to purchase,
the Bank of America Mortgage Loans identified on the schedule (the "Mortgage
Loan Schedule") annexed hereto as Exhibit A. The Mortgage Loan Schedule may be
amended to reflect the actual Mortgage Loans delivered to the Purchaser pursuant
to
<PAGE>
the terms hereof. The Bank of America Mortgage Loans will have an aggregate
principal balance of $332,234,891.37 (the "Bank of America Balance") (subject to
a variance of plus or minus 5.0%) as of the close of business on the Cut-off
Date, after giving effect to any payments due on or before such date whether or
not received. The Bank of America Balance, together with the aggregate principal
balance of the Other Mortgage Loans as of the Cut-Off Date (after giving effect
to any payments due on or before such date whether or not received), shall equal
an aggregate principal balance (the "Initial Pool Balance") of $3,408,048,239
(subject to a variance of plus or minus 5%). The purchase and sale of the Bank
of America Mortgage Loans shall take place on May 28, 1998 or such other date as
shall be mutually acceptable to the parties hereto (the "Closing Date"). The
consideration for the Bank of America Mortgage Loans shall consist of a cash
amount equal to $343,641,549 (the "Aggregate Purchase Price") (which is equal to
the Bank of America Balance plus interest accrued on the Bank of America Balance
at the related Net Mortgage Rate for the period from and including the Cut-off
Date up to but not including the Closing Date less fees and expenses payable by
Bank of America) which cash amount shall be paid to the Seller or its designee
by wire transfer in immediately available funds on the Closing Date.
The Purchaser will assign to the Trustee, all of its right, title
and interest in and to the Bank of America Mortgage Loans.
SECTION 2. Conveyance of Mortgage Loans.
(a) Effective as of the Closing Date, subject only to receipt of the
purchase price referred to in Section 1 hereof, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Purchaser, without
recourse, all the right, title and interest of the Seller in and to the Bank of
America Mortgage Loans identified on the Mortgage Loan Schedule as of such date
other than the primary servicing rights. The Mortgage Loan Schedule, as it may
be amended, shall conform to the requirements set forth in this Agreement and
the Pooling and Servicing Agreement.
(b) The Purchaser or its assignee shall be entitled to receive all
scheduled payments of principal and interest due after the Cut-off Date, and all
other recoveries of principal and interest collected after the Cut-off Date
(other than in respect of principal and interest on the Bank of America Mortgage
Loans due on or before the Cut-off Date). All scheduled payments of principal
and interest due on or before the Cut-off Date but collected after the Cut-off
Date, and recoveries of principal and interest collected on or before the
Cut-off Date (only in respect of principal and interest on the Bank of America
Mortgage Loans due on or before the Cut-off Date and principal prepayments
thereon), shall belong to, and be promptly remitted to, the Seller.
2
<PAGE>
(c) The Seller hereby represents and warrants that it has, on behalf
of the Purchaser, delivered to the Trustee, the documents and instruments
specified below with respect to each Bank of America Mortgage Loan (each a
"Mortgage File"). All Mortgage Files so delivered will be held by the Trustee in
escrow at all times prior to the Closing Date. Each Mortgage File shall, except
as otherwise disclosed on Exhibit B hereto, contain the following documents:
(i) the original executed Mortgage Note (or a lost note affidavit
and indemnity with a copy of such Mortgage Note attached
thereto) together with any intervening endorsements thereon,
endorsed (without recourse, representation or warranty,
express or implied) to the order of NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as trustee for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 1998-C2 or in blank;
(ii) an original or copy of the Mortgage and any intervening
assignments thereof, in each case with evidence of recording
indicated thereon;
(iii) an original or copy of any related Assignment of Leases (if
such item is a document separate from the Mortgage), together
with any intervening assignments thereof, in each case with
evidence of recording indicated thereon;
(iv) an original executed assignment, in recordable form, of (a)
the Mortgage, (b) any related Assignment of Leases (if such
item is a document separate from the Mortgage) and (c) any
other recorded document relating to the Mortgage Loan
otherwise included in the Mortgage File, in favor of NORWEST
BANK MINNESOTA, NATIONAL ASSOCIATION, as trustee for the
registered holders of First Union-Lehman Brothers-Bank of
America Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 1998-C2 in recordable form;
(v) an original assignment of all unrecorded documents relating to
the Mortgage Loan, in favor of NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as trustee for the registered holders of
First Union-Lehman Brothers-Bank of America Commercial
Mortgage Trust, Commercial Mortgage Pass-Through Certificates,
Series 1998-C2;
(vi) originals or copies of any written modification agreements in
those instances where the terms or
3
<PAGE>
provisions of the Mortgage or Mortgage Note have been
modified;
(vii) the original or a copy of the policy or certificate of
lender's title insurance issued on the date of the origination
of such Mortgage Loan, or, if such policy has not been issued,
an irrevocable, binding commitment to issue such title
insurance policy; and
(viii) any filed copies (with evidence of filing) of any prior UCC
Financing Statements in favor of the originator of such
Mortgage Loan or in favor of any assignee prior to the Trustee
(but only to the extent the Seller had possession of such UCC
Financing Statements prior to the Closing Date) and, if there
is an effective UCC Financing Statement in favor of the Seller
on record with the applicable public office for UCC Financing
Statements, an original UCC-2 or UCC-3 assignment, in form
suitable for filing, as appropriate, in favor of NORWEST BANK
MINNESOTA, NATIONAL ASSOCIATION, as trustee for the registered
holders of First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust, Commercial Mortgage Pass-Through
Certificates, Series 1998-C2; and
(ix) an original or copy of any Ground Lease, any Credit Lease and
any Lease Enhancement Policy or Guaranty.
(d) Within 30 days following the Closing Date, the Purchaser shall
submit or cause to be submitted for recordation or filing, as the case may be,
in the appropriate public office for real property records or Uniform Commercial
Code financing statements, as appropriate, each assignment of Mortgage and each
assignment of Assignment of Leases referred to in clause (iv) of subsection (c)
above and each UCC-2 and UCC-3 in favor of and delivered to the Trustee
constituting part of the Mortgage File. If any such document or instrument is
lost or returned unrecorded or unfiled, as the case may be, because of a defect
therein, then the Seller shall prepare a substitute therefor or cure such defect
or cause such to be done, as the case may be, and the Seller shall deliver such
substitute or corrected document or instrument to the Purchaser or its designee.
(e) All documents and records (except attorney-client privileged
communication and internal credit analysis of the Seller) relating to each Bank
of America Mortgage Loan and in the Seller's possession (the "Additional
Mortgage Loan Documents") that are not required to be delivered to the Trustee
shall be delivered or caused to be delivered by the Seller to the Master
Servicer or at the direction of the Master Servicer to the
4
<PAGE>
appropriate sub-servicer, together with any related escrow amounts and reserve
amounts.
SECTION 3. Representations, Warranties and Covenants of Seller.
(a) The Seller hereby represents and warrants to and covenants with
the Purchaser, as of the date hereof, that:
(i) The Seller is a national banking association corporation
validly existing under the laws of the United States of America and
possesses all requisite authority, power, licenses, permits and franchises
to carry on its business as currently conducted by it and to execute,
deliver and comply with its obligations under the terms of this Agreement.
(ii) This Agreement has been duly and validly authorized,
executed and delivered by the Seller and, assuming due authorization,
execution and delivery hereof by the Purchaser, constitutes a legal, valid
and binding obligation of the Seller, enforceable against the Seller in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the enforcement of creditors' rights in general, as they may be
applied in the context of the insolvency of a national banking
association, and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law), and by
public policy considerations underlying the securities laws, to the extent
that such public policy considerations limit the enforceability of the
provisions of this Agreement which purport to provide indemnification from
liabilities under applicable securities laws.
(iii) The execution and delivery of this Agreement by the
Seller and the Seller's performance and compliance with the terms of this
Agreement will not (A) violate the Seller's articles of association or
By-Laws, (B) violate any law or regulation or any administrative decree or
order to which it is subject or (C) constitute a material default (or an
event which, with notice or lapse of time, or both, would constitute a
material default) under, or result in the breach of, any material
contract, agreement or other instrument to which the Seller is a party or
by which the Seller is bound.
(iv) The Seller is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal,
state, municipal or other governmental agency or body, which default might
have consequences that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the condition (financial or
other) or operations of the Seller
5
<PAGE>
or its properties or have consequences that would materially and adversely
affect its performance hereunder.
(v) The Seller is not a party to or bound by any agreement or
instrument or subject to any articles of association, bylaws or any other
corporate restriction or any judgment, order, writ, injunction, decree,
law or regulation that would, in the Seller's reasonable and good faith
judgment, materially and adversely affect the ability of the Seller to
perform its obligations under this Agreement or that requires the consent
of any third person to the execution of this Agreement or the performance
by the Seller of its obligations under this Agreement (except to the
extent such consent has been obtained).
(vi) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution, delivery and
performance by the Seller of or compliance by the Seller with this
Agreement or the consummation of the transactions contemplated by this
Agreement except as have previously been obtained, and no bulk sale law
applies to such transactions.
(vii) No litigation is pending or, to the best of the Seller's
knowledge, threatened against the Seller that would, in the Seller's good
faith and reasonable judgment, prohibit its entering into this Agreement
or materially and adversely affect the performance by the Seller of its
obligations under this Agreement.
(viii) Under generally accepted accounting principles ("GAAP")
and for federal income tax purposes, the Seller will report the transfer
of the Bank of America Mortgage Loans to the Purchaser as a sale of the
Bank of America Mortgage Loans to the Purchaser in exchange for
consideration consisting of the Aggregate Purchase Price. The
consideration received by the Seller upon the sale of the Bank of America
Mortgage Loans to the Purchaser will constitute reasonably equivalent
value and fair consideration for the Bank of America Mortgage Loans. The
Seller will be solvent at all relevant times prior to, and will not be
rendered insolvent by, the sale of the Bank of America Mortgage Loans to
the Purchaser. The Seller is not selling the Bank of America Mortgage
Loans to the Purchaser with any intent to hinder, delay or defraud any of
the creditors of the Seller.
(b) The Seller hereby makes the representations and warranties
contained in Schedule I, Schedule II and Schedule III hereto for the benefit of
the Purchaser and the Trustee for the benefit of the Certificateholders as of
the Closing Date, with respect to (and solely with respect to) each Bank of
America Mortgage Loan. References in such representations and warranties to
"Mortgage Loan" and "Mortgage Loans" shall be deemed to mean
6
<PAGE>
"Bank of America Mortgage Loan" and "Bank of America Mortgage Loans,"
respectively.
(c) If the Seller receives written notice of a Document Defect or a
Breach pursuant to Section 2.03(a) of the Pooling and Servicing Agreement
relating to a Bank of America Mortgage Loan, then the Seller, shall not later
than 90 days from receipt of such notice (or, in the case of a Document Defect
or Breach relating to a Bank of America Mortgage Loan not being a "qualified
mortgage" within the meaning of the REMIC Provisions (a "Qualified Mortgage"),
not later than 90 days of any party to the Pooling and Servicing Agreement
discovering such Document Defect or Breach), if such Document Defect or Breach
shall materially and adversely affect the value of the related Bank of America
Mortgage Loan or the interest of the Certificateholders therein, cure such
Document Defect or Breach, as the case may be, in all material respects, which
shall include payment of losses and any Additional Trust Fund Expenses
associated therewith or, if such Document Defect or Breach (other than omissions
solely due to a document not having been returned by the related recording
office) cannot be cured within such 90-day period, repurchase the affected Bank
of America Mortgage Loan at the applicable Purchase Price not later than the end
of such 90-day period; provided, however, that if such Document Defect or Breach
is capable of being cured but not within such 90-day period, such Document
Defect or Breach does not relate to the Bank of America Mortgage Loan not being
treated as a Qualified Mortgage, and the Seller has commenced and is diligently
proceeding with the cure of such Document Defect or Breach within such 90-day
period, such Seller shall have an additional 90 days to complete such cure (or,
failing such cure, to repurchase the related Bank of America Mortgage Loan); and
provided, further, that with respect to such additional 90-day period the Seller
shall have delivered an Officer's Certificate to the Trustee setting forth the
reason such Document Defect or Breach is not capable of being cured within the
initial 90-day period and what actions the Seller is pursuing in connection with
the cure thereof and stating that the Seller anticipates that such Document
Defect or Breach will be cured within the additional 90-day period. For a period
of two years from the Closing Date, so long as there remains any Mortgage File
relating to a Bank of America Mortgage Loan as to which there is any uncured
Document Defect, the Seller shall provide the Officer's Certificate to the
Trustee described above as to the reasons such Document Defect remains uncured
and as to the actions being taken to pursue cure; provided, however, that,
without limiting the effect of the forgoing provisions of this Section 3(c), if
such Document Defect shall materially and adversely affect the value of such
Bank of America Mortgage Loan or the interests of the holders of the Certificate
therein, the Seller shall in all cases on or prior to the second anniversary of
the Closing Date either cause such Document Defect to be cured or repurchase the
affected Mortgage Loan. In addition, the Seller agrees to pay all Servicing
Advances, Additional Trust Fund Expenses and interest accrued thereon incurred
by the
7
<PAGE>
Special Servicer or the Trust in connection with the Spa Business Center Loan
promptly upon receipt from the Special Servicer of an Officer's Certificate
containing the information required pursuant to Section 3.19(c) of the Pooling
and Servicing Agreement. Notwithstanding the foregoing, the delivery of a
commitment to issue a policy of lender's title insurance as described in clause
(xii) of Schedule I hereof in lieu of the delivery of the actual policy of
lender's title insurance shall not be considered a Document Defect with respect
to any Mortgage File if such actual policy of insurance is delivered to the
Trustee or a Custodian on its behalf not later than the 90th day following the
Closing Date.
(d) In connection with any repurchase of a Bank of America Mortgage
Loan contemplated hereby, the Trustee, the Custodian, the Master Servicer and
the Special Servicer shall each tender to the Seller, upon delivery to each of
them of a receipt executed by the Seller, all portions of the Mortgage File and
other documents pertaining to such Mortgage Loan possessed by it, and each
document that constitutes a part of the Mortgage File shall be endorsed or
assigned to the extent necessary or appropriate to the Seller or its designee in
the same manner, and pursuant to appropriate forms of assignment, substantially
similar to the manner and forms pursuant to which documents were previously
assigned to the Trustee.
SECTION 4. Representations and Warranties of the Purchaser. In order to induce
the Seller to enter into this Agreement, the Purchaser hereby represents and
warrants for the benefit of the Seller as of the date hereof that:
(a) The Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of North Carolina. The
Purchaser has the full corporate power and authority and legal right to acquire
the Bank of America Mortgage Loans from the Seller and to transfer the Bank of
America Mortgage Loans to the Trustee.
(b) This Agreement has been duly and validly authorized, executed
and delivered by the Purchaser, all requisite action by the Purchaser's
directors and officers has been taken in connection therewith, and (assuming the
due authorization, execution and delivery hereof by the Seller) this Agreement
constitutes the valid, legal and binding agreement of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as such enforcement
may be limited by (A) laws relating to bankruptcy, insolvency, reorganization,
receivership or moratorium, (B) other laws relating to or affecting the rights
of creditors generally, or (C) general equity principles (regardless of whether
such enforcement is considered in a proceeding in equity or at law).
(c) Except as may be required under federal or state securities laws
(and which will be obtained on a timely basis),
8
<PAGE>
no consent, approval, authorization or order of, registration or filing with, or
notice to, any governmental authority or court, is required, under federal or
state law, for the execution, delivery and performance by the Purchaser of or
compliance by the Purchaser with this Agreement, or the consummation by the
Purchaser of any transaction described in this Agreement.
(d) None of the acquisition of the Bank of America Mortgage Loans by
the Purchaser, the transfer of the Bank of America Mortgage Loans to the
Trustee, and the execution, delivery or performance of this Agreement by the
Purchaser, conflicts or will conflict with, results or will result in a breach
of, or constitutes or will constitute a default under (A) any term or provision
of the Purchaser's Articles of Incorporation or Bylaws, (B) any term or
provision of any material agreement, contract, instrument or indenture, to which
the Purchaser is a party or by which the Purchaser is bound, or (C) any law,
rule, regulation, order, judgment, writ, injunction or decree of any court or
governmental authority having jurisdiction over the Purchaser or its assets.
(e) Under GAAP and for federal income tax purposes, the Purchaser
will report the transfer of the Bank of America Mortgage Loans by the Seller to
the Purchaser as a sale of the Bank of America Mortgage Loans to the Purchaser
in exchange for consideration consisting of the Aggregate Purchase Price.
SECTION 5. Closing. The closing of the sale of the Bank of America Mortgage
Loans (the "Closing") shall be held at the offices of Willkie Farr & Gallagher,
787 Seventh Avenue, New York, New York 10019-6099 at 10:00 A.M., New York time,
on the Closing Date.
The Closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller set
forth in or made pursuant to Sections 3(a) and 3(b) of this Agreement and all of
the representations and warranties of the Purchaser set forth in Section 4 of
this Agreement shall be true and correct in all material respects as of the
Closing Date; provided, however, that any material inaccuracy in any
representation and warranty set forth in or made pursuant to Section 3(b) shall
not affect the Purchaser's obligation to purchase the Mortgage Loans not
affected by such inaccuracy;
(b) All documents specified in Section 6 of this Agreement (the
"Closing Documents"), in such forms as are agreed upon and acceptable to the
Purchaser in its reasonable discretion, shall be duly executed and delivered by
all signatories as required pursuant to the respective terms thereof;
(c) The Seller shall have delivered and released to the Trustee (or
a Custodian on its behalf) and the Master
9
<PAGE>
Servicer, respectively, all documents represented to have been or required to be
delivered to the Trustee and the Master Servicer pursuant to Section 2 of this
Agreement;
(d) All other terms and conditions of this Agreement required to be
complied with on or before the Closing Date shall have been complied with in all
material respects and the Seller shall have the ability to comply with all terms
and conditions and perform all duties and obligations required to be complied
with or performed after the Closing Date; and
(e) The Seller shall have paid all fees and expenses payable by it
to the Purchaser or otherwise pursuant to this Agreement as of the Closing Date.
Both parties agree to use their best efforts to perform their
respective obligations hereunder in a manner that will enable the Purchaser to
purchase the Bank of America Mortgage Loans on the Closing Date.
SECTION 6. Closing Documents. The Closing Documents shall consist of the
following:
(a) This Agreement duly executed by the Purchaser and the Seller;
(b) A Certificate of the Seller, executed by a duly authorized
officer of the Seller and dated the Closing Date, and upon which the Purchaser
and the Underwriters may rely, to the effect that: (i) the representations and
warranties of the Seller in this Agreement are true and correct in all material
respects at and as of the Closing Date with the same effect as if made on such
date; and (ii) the Seller has, in all material respects, complied with all the
agreements and satisfied all the conditions on its part that are required under
this Agreement to be performed or satisfied at or prior to the date hereof;
(c) An Officer's Certificate from an officer of the Seller, dated
the Closing Date, and upon which the Purchaser may rely, to the effect that each
individual who, as an officer or representative of the Seller, signed this
Agreement or any other document or certificate delivered on or before the
Closing Date in connection with the transactions contemplated herein, was at the
respective times of such signing and delivery, and is as of the Closing Date,
duly elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such documents
and certificates are their genuine signatures;
(d) An Officer's Certificate from an officer of the Seller, dated
the Closing Date, and upon which the Purchaser and the Underwriters may rely, to
the effect that (i) such officer has carefully examined the Prospectus and
nothing has come to his attention that would lead him to believe that the
Prospectus, as
10
<PAGE>
of the date of the Prospectus Supplement or as of the Closing Date, included or
includes any untrue statement of a material fact relating to the Bank of America
Mortgage Loans or omitted or omits to state therein a material fact necessary in
order to make the statements therein relating to the Bank of America Mortgage
Loans, in light of the circumstances under which they were made, not misleading,
and (ii) such officer has examined the Memorandum and nothing has come to his
attention that would lead him to believe that the Memorandum, as of the date
thereof or as of the Closing Date, included or includes any untrue statement of
a material fact relating to the Bank of America Mortgage Loans or omitted or
omits to state therein a material fact necessary in order to make the statements
therein related to the Bank of America Mortgage Loans, in the light of the
circumstances under which they were made, not misleading.
(e) The resolutions of the requisite committee of the Seller's board
of directors authorizing the Seller's entering into the transactions
contemplated by this Agreement, the articles of association and by-laws of the
Seller, and a certificate of good standing of the Seller issued by the Office of
the Comptroller of the Currency of the United States not earlier than sixty (60)
days prior to the Closing Date;
(f) A written opinion of counsel for the Seller, substantially in
the form of Schedule V, with any modifications required by the Purchaser, its
counsel or Rating Agencies, dated the Closing Date and addressed to the
Purchaser, the Trustee, the Underwriters and each of the Rating Agencies,
together with such other written opinions as may be required by the Rating
Agencies; and
(g) Such further certificates, opinions and documents as the
Purchaser may reasonably request.
SECTION 7. Indemnification.
(a) The Seller shall indemnify and hold harmless the Purchaser, the
Underwriters, their respective officers and directors, and each person, if any,
who controls the Purchaser or any Underwriter within the meaning of either
Section 15 of the Securities Act of 1933, as amended (the "1933 Act") or Section
20 of the Securities Exchange Act of 1934, as amended (the "1934 Act"), against
any and all losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the 1933 Act, the 1934 Act or other
federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) (i) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in (A) the Prospectus Supplement,
the Memorandum, the Diskette or, insofar as they are required to be filed as
part of the Registration Statement pursuant to the No-Action Letters, any
Computational Materials or ABS Term Sheets with respect to
11
<PAGE>
the Registered Certificates, or in any revision or amendment of or supplement to
any of the foregoing or (B) any items similar to Computational Materials and ABS
Term Sheets forwarded to prospective investors in the Non-Registered
Certificates, or (ii) arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; but only if and to the extent that
(I) any such untrue statement or alleged untrue statement or omission or alleged
omission arises out of or is based upon an untrue statement or omission with
respect to the Bank of America Mortgage Loans, the related Mortgagors and/or the
related Mortgaged Properties contained in the Data File (it being herein
acknowledged that the Data File was used to prepare the Prospectus Supplement
including without limitation Annex A thereto, the Memorandum, the Diskette, the
Computational Materials and ABS Term Sheets with respect to the Registered
Certificates and any items similar to Computational Materials and ABS Term
Sheets forwarded to prospective investors in the Non-Registered Certificates),
(II) any such untrue statement or alleged untrue statement or omission or
alleged omission of a material fact is with respect to, or arises out of or is
based upon an untrue statement or omission of a material fact with respect to,
the information regarding the Bank of America Mortgage Loans, the related
Mortgagors, the related Mortgaged Properties and/or the Seller set forth (X) in
the Prospectus Supplement and the Memorandum under the headings "Summary of the
Prospectus Supplement--The Mortgage Pool" or "Summary of the Memorandum--The
Mortgage Pool", as applicable, "Risk Factors--The Mortgage Loans" and
"Description of the Mortgage Pool" and (Y) on Annex A to the Prospectus
Supplement and, to the extent consistent therewith, on the Diskette, or (III)
any such untrue statement or alleged untrue statement or omission or alleged
omission arises out of or is based upon a breach of the representations and
warranties of the Seller set forth in or made pursuant to Section 3; provided
that the indemnification provided by this Section 7 shall not apply to the
extent that such untrue statement or omission of a material fact was made as a
result of an error in the manipulation of, or in any calculations based upon, or
in any aggregation of the information regarding the Bank of America Mortgage
Loans, the related Mortgagors and/or the related Mortgaged Properties set forth
in the Data File and Annex A to the Prospectus Supplement, including without
limitation the aggregation of such information with comparable information
relating to the Other Mortgage Loans in the Trust Fund. This indemnity agreement
will be in addition to any liability which the Seller may otherwise have.
For purposes of this Agreement, "Registration Statement" shall mean
the registration statement No. 333-48943 filed by the Purchaser on Form S-3,
including without limitation exhibits thereto and information incorporated
therein by reference; "Prospectus" shall mean the prospectus dated May 11,
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<PAGE>
1998, as supplemented by the prospectus supplement dated May 21, 1998 (the
"Prospectus Supplement"), relating to the Registered Certificates, including all
annexes thereto; "Memorandum" shall mean the private placement memorandum dated
May 28, 1998, relating to the Non-Registered Certificates, including all
exhibits thereto; "Registered Certificates" shall mean the Class A-1, Class A-2,
Class B, Class C, Class D, Class E, and Class IO Certificates; "Non-Registered
Certificates" shall mean the Certificates other than the Registered
Certificates; "Computational Materials" shall have the meaning assigned thereto
in the no-action letter dated May 20, 1994 issued by the Division of Corporation
Finance of the Securities and Exchange Commission (the "Commission") to Kidder,
Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated, and Kidder
Structured Asset Corporation and the no-action letter dated May 27, 1994 issued
by the Division of Corporation Finance of the Commission to the Public
Securities Association (together, the "Kidder Letters"); "ABS Term Sheets shall
have the meaning assigned thereto in the no-action letter dated February 17,
1995 issued by the Division of Corporation Finance of the Commission to the
Public Securities Association (the "PSA Letter" and, together with the Kidder
letters, the "No-Action Letters"); "Diskette" shall mean the diskette attached
to each of the Prospectus and the Memorandum; and "Data File" shall mean the
compilation of information and data regarding the Other Mortgage Loans and the
Bank of America Mortgage Loans (such information and data with respect to the
Bank of America Mortgage Loans being taken from the Bank of America Data File,
as supplemented by any modifications made subsequent to the date of the Bank of
America Data File) covered by the Agreed Upon Procedures Letter dated May 21,
1998 and rendered by Deloitte & Touche LLP (a "hard copy" of which Data File was
initialed on behalf of the Seller and the Purchaser). "Bank of America Data
File" shall mean the compilation of information and data regarding the Bank of
America Mortgage Loans, covered by the Agreed Upon Procedure Letter dated May
21, 1998 and rendered by Deloitte & Touche LLP.
(b) Promptly after receipt by any person entitled to indemnification
under this Section 7 (an "indemnified party") of notice of the commencement of
any action, such indemnified party will, if a claim in respect thereof is to be
made against the Seller (the "indemnifying party") under this Section 7, notify
the indemnifying party in writing of the commencement thereof; but the omission
so to notify the indemnifying party will not relieve it from any liability that
it may have to any indemnified party otherwise than under this Section 7. In
case any such action is brought against any indemnified party and it notifies
the indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein, and to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel selected by the indemnifying party and satisfactory to such
indemnified party; provided, however, that
13
<PAGE>
if the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party or parties shall have reasonably
concluded that there may be legal defenses available to it or them and/or other
indemnified parties that are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, unless (i) the indemnified party shall have
employed separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel, approved by the Purchaser and the Underwriters,
representing all the indemnified parties under Section 7(a) who are parties to
such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall only be in respect of the counsel
referred to in such clause (i) or (iii).
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under Section 7(a) hereof or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
the indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities, in such proportion as is
appropriate to reflect the relative fault of the indemnified and indemnifying
parties in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnified and indemnifying parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by such parties.
(d) The Purchaser and the Seller agree that it would not be just and
equitable if contribution pursuant to Section 7(c) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the considerations referred to in Section 7(c) above. The amount
14
<PAGE>
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in this Section 7 shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim, except where the indemnified party is
required to bear such expenses pursuant to this Section 7, which expenses the
indemnifying party shall pay as and when incurred, at the request of the
indemnified party, to the extent that the indemnifying party will be ultimately
obligated to pay such expenses. If any expenses so paid by the indemnifying
party are subsequently determined to not be required to be borne by the
indemnifying party hereunder, the party that received such payment shall
promptly refund the amount so paid to the party which made such payment. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 1933 Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
(e) The indemnity and contribution agreements contained in this
Section 7 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by the Purchaser,
the Underwriters, any of their respective directors or officers, or any person
controlling the Purchaser or the Underwriters, and (iii) acceptance of and
payment for any of the Certificates.
(f) Without limiting the generality or applicability of any other
provision of this Agreement, the Underwriters shall be third-party beneficiaries
of the provisions of this Section 7.
SECTION 8. Costs. The Seller shall pay (or shall reimburse the Purchaser to the
extent that the Purchaser has paid) the Seller's pro rata portion of the
aggregate of the following amounts (the Seller's pro rata portion to be
determined according to the percentage that the Bank of America Balance
represents of the Initial Pool Balance): (i) the costs and expenses of printing
(or otherwise reproducing) and delivering a preliminary and final Prospectus and
Memorandum relating to the Certificates; (ii) the initial fees, costs, and
expenses of the Trustee (including reasonable attorneys' fees); (iii) the filing
fee charged by the Securities and Exchange Commission for registration of the
Certificates so registered; (iv) the fees charged by the Rating Agencies to rate
the Certificates so rated; (v) the expense of recording any assignment of
Mortgage or assignment of Assignment of Leases as contemplated by Section 2
hereof; and (vi) the cost of obtaining a "comfort letter" from a firm of
certified public accountants selected by the Purchaser and the Seller with
respect to numerical information in respect of the Bank of America Mortgage
Loans included in the Prospectus and Memorandum. All other costs and expenses in
connection with the transactions contemplated hereunder shall be borne by the
party incurring such expense.
15
<PAGE>
SECTION 9. Grant of a Security Interest. It is the express intent of the parties
hereto that the conveyance of the Bank of America Mortgage Loans by the Seller
to the Purchaser as provided in Section 2 hereof be, and be construed as, a sale
of the Bank of America Mortgage Loans by the Seller to the Purchaser and not as
a pledge of the Bank of America Mortgage Loans by the Seller to the Purchaser to
secure a debt or other obligation of the Seller. However, if, notwithstanding
the aforementioned intent of the parties, the Bank of America Mortgage Loans are
held to be property of the Seller, then, (a) it is the express intent of the
parties that such conveyance be deemed a pledge of the Bank of America Mortgage
Loans by the Seller to the Purchaser to secure a debt or other obligation of the
Seller, and (b) (i) this Agreement shall also be deemed to be a security
agreement within the meaning of Articles 8 and 9 of the Uniform Commercial Code
of the applicable jurisdiction; (ii) the conveyance provided for in Section 2
hereof shall be deemed to be a grant by the Seller to the Purchaser of a
security interest in all of the Seller's right, title and interest in and to the
Bank of America Mortgage Loans, and all amounts payable to the holder of the
Bank of America 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, other than investment earnings, from time to time held or invested
in the Certificate Account, the Distribution Account or, if established, the REO
Account (each as defined in the Pooling and Servicing Agreement) whether in the
form of cash, instruments, securities or other property; (iii) the assignment to
the Trustee of the interest of the Purchaser as contemplated by Section 1 hereof
shall be deemed to be an assignment of any security interest created hereunder;
(iv) the possession by the Trustee or any of its agents, including, without
limitation, the Custodian, of the Mortgage 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 Uniform
Commercial Code of the applicable jurisdiction; and (v) notifications to persons
(other than the Trustee) holding such property, and acknowledgments, receipts or
confirmations from persons (other than the Trustee) holding such property, shall
be deemed notifications to, or acknowledgments, receipts or confirmations from,
financial intermediaries, bailees or agents (as applicable) of the secured party
for the purpose of perfecting such security interest under applicable law. The
Seller and the Purchaser shall, to the extent consistent with this Agreement,
take such actions as may be necessary to ensure that, if this Agreement were
deemed to create a security interest in the Bank of America 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 and the Pooling and Servicing Agreement.
16
<PAGE>
SECTION 10. Notices. All notices, copies, requests, consents, demands and other
communications required hereunder shall be in writing and telecopied or
delivered to the intended recipient at the "Address for Notices" specified
beneath its name on the signature pages hereof or, as to either party, at such
other address as shall be designated by such party in a notice hereunder to the
other party. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
SECTION 11. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement,
incorporated herein by reference or contained in the certificates of officers of
the Seller submitted pursuant hereto, shall remain operative and in full force
and effect and shall survive delivery of the Bank of America Mortgage Loans by
the Seller to the Purchaser (and by the Purchaser to the Trustee).
SECTION 12. Severability of Provisions. Any part, provision, representation,
warranty or covenant of this Agreement that is prohibited or which is held to be
void or unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof. Any part,
provision, representation, warranty or covenant of this Agreement that is
prohibited or unenforceable or is held to be void or unenforceable in any
particular jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by applicable law,
the parties hereto waive any provision of law which prohibits or renders void or
unenforceable any provision hereof.
SECTION 13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but which together shall
constitute one and the same agreement.
SECTION 14. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS
AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED IN ACCORDANCE WITH
THE INTERNAL LAWS AND DECISIONS OF NEW YORK. THE PARTIES HERETO INTEND THAT THE
PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY
TO THIS AGREEMENT.
SECTION 15. Further Assurances. The Seller and the Purchaser agree to execute
and deliver such instruments and take such further actions as the other party
may, from time to time, reasonably request in order to effectuate the purposes
and to carry out the terms of this Agreement.
17
<PAGE>
SECTION 16. Successors and Assigns. The rights and obligations of the Seller
under this Agreement shall not be assigned by the Seller without the prior
written consent of the Purchaser, except that any person into which the Seller
may be merged or consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Seller is a party, or any person
succeeding to all or substantially all of the business of the Seller, shall be
the successor to the Seller hereunder. The Purchaser has the right to assign its
interest under this Agreement, in whole or in part, as may be required to effect
the purposes of the Pooling and Servicing Agreement, and the assignee shall, to
the extent of such assignment, succeed to the rights and obligations hereunder
of the Purchaser. Subject to the foregoing, this Agreement shall bind and inure
to the benefit of and be enforceable by the Seller, the Purchaser, the
Underwriters (as intended third party beneficiaries hereof) and their permitted
successors and assigns, and the officers, directors and controlling persons
referred to in Section 7. This Agreement is enforceable by the Underwriters and
the other third party beneficiaries hereto in all respects to the same extent as
if they had been signatories hereof.
SECTION 17. Amendments. No term or provision of this Agreement may be waived or
modified unless such waiver or modification is in writing and signed by a duly
authorized officer of the party, or third party beneficiary, against whom such
waiver or modification is sought to be enforced.
18
<PAGE>
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed hereto by their respective duly authorized officers as of the
date first above written.
SELLER
BANK OF AMERICA
By:
----------------------------------
Name:
Title:
Address for Notices:
Bank of America
50 California Street, 12th Floor
San Francisco, CA 94111
Attention:
Telecopier No.:
Telephone No.:
PURCHASER
FIRST UNION COMMERCIAL
MORTGAGE SECURITIES, INC.
By:
----------------------------------
Name: Craig Lieberman
Title Vice President
Address for Notices:
One First Union Center
301 South College Street
Charlotte, North Carolina 28288-0600
Attention: Craig Lieberman
Telecopier No.: (704) 374-6435
Telephone No.: (704) 383-7407
19
<PAGE>
Exhibit A
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Bank of America Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
60 Sundance West Apartments 3245 Clover Way
86 Innsbrook Village 800 E Nichols Blvd
88 Century Village Apartments 4801 Spencer Street
91 La Villita Apartments 1550 E Harmon
101 Village Green Office Park 5655 Lindero Canyon Road
108 Decatur Crossing Shopping Center 248 South Decatur Blvd
112 Orangebrook Manor Apartments 5400 Yarmouth Avenue
115 Pleasant Hills Villas 5520 Pleasant Hill Avenue
117 Legacy Apartments 1411 East Orangewood Avenue
118 Valley Breeze Apartments 1394 Oro Vista Road
130 Victoria Apartments 414-444 South Ardmore Avenue
160 Park Encino Apartments 5325 Newcastle Avenue
165 Forest Glen Apartments 1639 North Forest Road
182 Alta Vista Gardens Apartments 1425 North Alta Vista Blvd.
183 Kato Road 48835-48881 Kato Road
205 Fairesta Apartments 3250 Fairesta Street
207 Cody's Books 1716 4Th Street
212 Santa Ana Plaza 710-810 South Harbor Blvd
219 Plaza Codorniz 4300 North Miller Road
221 Villa Creek Apartments 2601 McBride Lane
227 Tarzana Tennis Club Apts. 18440 Hatteras Street
229 L.A. Community College 2340 Firestone Boulevard
234 Sunrise Vista 300 South Val Vista Drive
237 Seagate Facility 5898 Condor Drive
242 Lake Loft Center 641 West Lake Street
248 Ventana Row 2352 Shattuck Avenue
249 New Hampshire Apartments 445 South New Hampshire Ave
267 Windscape II Apartments 3099 Parhan Drive
272 Fairway Center 9115 Southwest Oleson Road
274 Gomes Plaza 1057-1075 Blossom Hill Road
300 The Pontiac Building 542 South Dearborn
301 Best Buy Retail Bldg. 6900 South Westnedge Avenue
304 Lincoln Arms Apartments 190 C Street
307 Northgate Villas Apartments 2305 Carville Drive
309 The Promenade Apartments 2330-2332 West Glenrosa Avenue
317 Wind & Sea Shopping Center 4140-4150 Capitola Road
325 San Leandro Furniture Center 2756 Alvarado Boulevard
327 Westlake Commerce Center 31121-31131 Via Colinas
329 Barnes & Noble 12170 Jefferson Avenue
330 Mcghan Medical Buildings 5511, 5531, 5551, & 5571 Ekwill Street
336 Meadowrock Apartments 1598 Becky Court
337 544 Lawrence Expressway 540-548 Lawrence Expressway
338 Courtyard At Scottsdale North 9160 East Shea Boulevard
339 Mountain Vista Apartments 4400 E Busby Drive
343 118 South Clinton Street 118 S Clinton Street
350 Bentley Avenue Apartments 1633 South Bentley Avenue
359 Americana Apartments 3701 East Chapman Avenue
366 Covington Club Apartments 1308 W. Covington Court
370 Regency Park Apartments 2973 West Swain Road
372 Three West Carillo Building 931-939 State Street
376 Tudor Gardens Apartments 15128-15144 Burbank Blvd
392 Ocean Villa Townhomes #2 4400-4600 Dallas Drive
397 Peoria Town Center 8110-8140 Peoria Avenue
411 Slauson Plaza 9402-9448 Slauson Avenue
419 Twin Fountains Apartments 2135 South Depew Street
434 Capitol Warehouse Building 4355 Duraform Lane
435 North Oaks Manor Apartments 600-616 North Oaks Drive
436 6100 Capital Center 6100 South Fashion Blvd
445 Glenoaks Apartments 1019 East Glenoaks Blvd
446 Lucky/Sav-On Center 2006 Avenue K
455 Westporte Apartments 2805 Larchmont Lane
458 Woodley Apartments 7035 Woodley Avenue
459 Hidden Park Apartments 10613 Lookaway Drive
460 Saum Apartments 1919 South Grand Boulevard
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
60 Reno NV 89509 10,092,322.04 68,214.00 7.1250 116 01/01/08
86 Sparks NV 89434 7,924,512.91 53,743.19 7.1590 116 01/01/08
88 Las Vegas NV 89119 7,774,993.83 52,729.16 7.1590 116 01/01/08
91 Las Vegas NV 89119 7,765,332.63 53,771.69 7.3560 114 11/01/07
101 Westlake Village CA 91362 7,096,616.22 51,601.86 7.8630 114 11/01/07
108 Las Vegas NV 89107 6,943,380.22 47,643.31 7.2630 114 11/01/07
112 Encino CA 91316 6,838,693.78 45,798.00 7.0510 118 03/01/08
115 Las Vegas NV 89103 6,732,378.75 45,521.57 7.1350 117 02/01/08
117 Phoenix AZ 85020 6,683,917.14 47,431.40 7.6270 117 02/01/08
118 San Diego CA 92154 6,671,562.47 47,173.54 7.5710 114 11/01/07
130 Los Angeles CA 90020 6,458,862.87 43,421.03 7.0710 116 01/01/08
160 Encino CA 91316 5,727,244.22 38,354.74 7.0510 118 03/01/08
165 La Grange Park IL 60526 5,575,834.45 39,133.01 7.4940 114 11/01/07
182 Los Angeles CA 90046 5,246,083.97 35,532.44 7.1460 116 01/01/08
183 Fremont CA 94539 5,183,443.80 35,275.87 7.1940 116 01/01/08
205 Glendale CA 91214 4,587,970.90 30,991.05 7.1250 117 02/01/08
207 Berkeley CA 94710 4,493,754.73 30,469.35 7.1750 118 03/01/08
212 Santa Ana CA 92704 4,482,358.10 30,965.66 7.3460 116 01/01/08
219 Scottsdale AZ 85251 4,246,854.08 29,754.46 7.5130 119 04/01/08
221 Santa Rosa CA 95403 4,196,581.00 28,041.50 7.0350 83 04/01/05
227 Tarzana CA 91356 4,150,453.39 27,795.14 7.0510 118 03/01/08
229 South Gate CA 90280 4,121,706.60 44,695.39 7.2280 135 08/01/09
234 Mesa AZ 85204 4,093,770.79 26,734.40 6.8020 118 03/01/08
237 Moorpark CA 93021 4,082,680.29 28,929.34 7.5930 114 11/01/07
242 Chicago IL 60661 3,987,665.78 27,575.23 7.3560 116 01/01/08
248 Berkeley CA 94704 3,881,505.61 28,345.44 7.3120 80 01/01/05
249 Los Angeles CA 90020 3,836,194.01 26,777.54 7.4460 115 12/01/07
267 Grand Prairie TX 75052 3,591,189.64 24,081.59 7.0540 117 02/01/08
272 Portland OR 97223 3,547,372.24 24,853.72 7.5130 119 04/01/08
274 San Jose CA 95123 3,492,968.16 26,264.41 7.6750 118 03/01/08
300 Chicago IL 60605 3,289,824.29 22,749.56 7.3560 116 01/01/08
301 Portage MI 49002 3,287,692.89 24,078.45 7.3560 117 02/01/08
304 Sparks NV 89431 3,252,040.67 22,054.99 7.1590 116 01/01/08
307 Reno NV 89512 3,231,170.58 21,303.98 6.8840 117 02/01/08
309 Phoenix AZ 85015 3,208,099.19 22,090.70 7.3070 115 12/01/07
317 Capitola CA 95010 3,146,055.81 22,206.73 7.5840 118 03/01/08
325 San Leandro CA 94577 3,093,291.66 22,472.96 7.2830 118 03/01/08
327 Westlake Village CA 91362 3,086,819.64 21,809.54 7.5630 114 11/01/07
329 Newport News VA 23602 3,058,550.65 22,400.26 7.3560 117 02/01/08
330 Goleta CA 93111 3,033,799.44 20,935.68 7.3290 115 12/01/07
336 Santa Rosa CA 95403 2,997,495.94 19,774.06 6.9080 119 04/01/08
337 Sunnyvale CA 95086 2,996,584.65 22,185.35 7.5080 119 04/01/08
338 Scottsdale AZ 85257 2,989,267.88 20,888.17 7.4570 115 12/01/07
339 Sierra Vista AZ 85635 2,988,062.61 20,383.96 7.2100 115 12/01/07
343 Chicago IL 60661 2,940,903.52 20,336.73 7.3560 116 01/01/08
350 Los Angeles CA 90025 2,836,527.64 20,172.12 7.6250 113 10/01/07
359 Orange CA 92869 2,688,048.26 18,648.23 7.3750 114 11/01/07
366 Peoria IL 61614 2,596,257.41 17,343.29 7.0260 118 03/01/08
370 Stockton CA 95207 2,587,545.22 18,299.01 7.5670 113 10/01/07
372 Santa Barbara CA 93101 2,546,696.96 17,744.49 7.4510 118 03/01/08
376 Los Angeles CA 91411 2,538,067.74 17,159.17 7.1130 114 11/01/07
392 Oxnard CA 93033 2,396,690.52 16,292.54 7.2010 118 03/01/08
397 Peoria AZ 85354 2,388,976.76 17,193.89 7.7500 113 10/01/07
411 Pico Rivera CA 90660 2,280,921.21 16,318.43 7.7060 116 01/01/08
419 Denver CO 80227 2,216,216.51 14,802.98 7.0000 79 12/05/04
434 Windsor WI 53598 2,156,227.94 22,952.35 7.5010 142 03/01/10
435 Osseo MN 55369 2,154,267.86 14,427.15 7.0390 117 02/01/08
436 Murray UT 84107 2,153,054.25 15,757.56 7.9390 115 12/01/07
445 Glendale CA 91206 2,112,568.12 14,282.49 7.1130 114 11/01/07
446 Lancaster CA 93536 2,106,979.91 14,339.19 7.1880 115 12/01/07
455 Peoria IL 61615 2,096,775.81 13,631.73 6.7580 118 03/01/08
458 Van Nuys CA 91406 2,093,358.54 14,294.38 7.2280 116 01/01/08
459 St Louis MO 63137 2,093,340.17 14,274.46 7.2140 116 01/15/08
460 St Louis MO 63104 2,093,340.17 14,274.46 7.2140 116 01/15/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
60 356 N 0.0900 0.0050 N - Act/360 Bank of America
86 356 N 0.0900 0.0050 N - Act/360 Bank of America
88 356 N 0.0900 0.0050 N - Act/360 Bank of America
91 354 N 0.0900 0.0050 N - Act/360 Bank of America
101 354 N 0.0900 0.0050 N - Act/360 Bank of America
108 354 N 0.0900 0.0050 N - Act/360 Bank of America
112 358 N 0.0900 0.0050 N - Act/360 Bank of America
115 357 N 0.0900 0.0050 N - Act/360 Bank of America
117 357 N 0.0900 0.0050 N - Act/360 Bank of America
118 354 N 0.0900 0.0050 N - Act/360 Bank of America
130 356 N 0.0900 0.0050 N - Act/360 Bank of America
160 358 N 0.0900 0.0050 N - Act/360 Bank of America
165 354 N 0.0900 0.0050 N - Act/360 Bank of America
182 356 N 0.0900 0.0050 N - Act/360 Bank of America
183 356 N 0.0900 0.0050 N - Act/360 Bank of America
205 357 N 0.0900 0.0050 N - Act/360 Bank of America
207 358 N 0.0900 0.0050 N - Act/360 Bank of America
212 356 N 0.0900 0.0050 N - Act/360 Bank of America
219 359 N 0.0900 0.0050 N - Act/360 Bank of America
221 359 N 0.0900 0.0050 N - Act/360 Bank of America
227 358 N 0.0900 0.0050 N - Act/360 Bank of America
229 N 0.0900 0.0050 N - 30/360 Bank of America
234 358 N 0.0900 0.0050 N - Act/360 Bank of America
237 354 N 0.0900 0.0050 N - Act/360 Bank of America
242 356 N 0.0900 0.0050 N - Act/360 Bank of America
248 296 N 0.0900 0.0050 N - Act/360 Bank of America
249 355 N 0.0900 0.0050 N - Act/360 Bank of America
267 357 N 0.0900 0.0050 N - 30/360 Bank of America
272 359 N 0.0900 0.0050 N - Act/360 Bank of America
274 298 N 0.0900 0.0050 N - Act/360 Bank of America
300 356 N 0.0900 0.0050 N - Act/360 Bank of America
301 297 N 0.0900 0.0050 N - Act/360 Bank of America
304 356 N 0.0900 0.0050 N - Act/360 Bank of America
307 357 N 0.0900 0.0050 N - Act/360 Bank of America
309 355 N 0.0900 0.0050 N - Act/360 Bank of America
317 358 N 0.0900 0.0050 N - Act/360 Bank of America
325 298 N 0.0900 0.0050 N - Act/360 Bank of America
327 354 N 0.0900 0.0050 N - Act/360 Bank of America
329 297 N 0.0900 0.0050 N - Act/360 Bank of America
330 355 N 0.0900 0.0050 N - Act/360 Bank of America
336 359 N 0.0900 0.0050 N - Act/360 Bank of America
337 299 N 0.0900 0.0050 N - Act/360 Bank of America
338 355 N 0.0900 0.0050 N - Act/360 Bank of America
339 355 N 0.0900 0.0050 N - 30/360 Bank of America
343 356 N 0.0900 0.0050 N - Act/360 Bank of America
350 353 N 0.0900 0.0050 N - Act/360 Bank of America
359 354 N 0.0900 0.0050 N - Act/360 Bank of America
366 358 N 0.0900 0.0050 N - Act/360 Bank of America
370 353 N 0.0900 0.0050 N - Act/360 Bank of America
372 358 N 0.0900 0.0050 N - Act/360 Bank of America
376 354 N 0.0900 0.0050 N - Act/360 Bank of America
392 358 N 0.0900 0.0050 N - Act/360 Bank of America
397 353 N 0.0900 0.0050 N - Act/360 Bank of America
411 356 N 0.0900 0.0050 N - Act/360 Bank of America
419 355 N 0.0900 0.0050 N - Act/360 Bank of America
434 N 0.0900 0.0050 N - 30/360 Bank of America
435 357 N 0.0900 0.0050 N - Act/360 Bank of America
436 355 N 0.0900 0.0050 N - Act/360 Bank of America
445 354 N 0.0900 0.0050 N - Act/360 Bank of America
446 355 N 0.0900 0.0050 N - Act/360 Bank of America
455 358 N 0.0900 0.0050 N - Act/360 Bank of America
458 356 N 0.0900 0.0050 N - Act/360 Bank of America
459 356 N 0.0900 0.0050 N - Act/360 Bank of America
460 356 N 0.0900 0.0050 N - Act/360 Bank of America
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
60 1.57 74.8 No Y Y
86 1.53 74.8 No Y Y
88 1.39 74.8 No Y Y
91 1.33 79.2 No Y Y
101 1.46 74.7 No Y N
108 1.44 73.9 No Y Y
112 1.40 72.1 No Y Y
115 1.31 77.4 No Y Y
117 1.34 74.0 No Y N
118 1.20 76.5 No Y Y
130 1.57 79.7 No Y Y
160 1.34 74.3 No Y Y
165 1.56 78.5 No Y Y
182 1.31 74.9 No Y Y
183 1.62 64.8 No Y Y
205 1.28 79.8 No Y Y
207 1.48 62.9 No Y Y
212 1.36 74.7 No Y Y
219 1.26 72.0 No Y Y
221 1.39 73.6 No Y Y
227 1.42 74.8 No Y Y
229 1.24 73.6 No Y N
234 2.06 46.8 No Y Y
237 1.31 70.8 No Y Y
242 1.54 70.9 No Y Y
248 1.60 58.5 No Y Y
249 1.26 79.9 No Y Y
267 1.53 75.8 No Y N
272 1.29 71.0 No Y Y
274 1.60 53.7 No Y N
300 1.69 70.0 No Y Y
301 1.36 73.1 No Y Y
304 1.56 74.8 No Y Y
307 1.39 74.8 No Y Y
309 1.44 79.7 No Y Y
317 1.30 74.9 No Y Y
325 1.42 60.0 No Y Y
327 1.49 70.2 No Y Y
329 1.29 74.6 No Y Y
330 1.64 74.0 No Y Y
336 1.41 68.1 No Y Y
337 1.50 66.6 No Y Y
338 1.79 59.8 No Y Y
339 1.30 74.7 No Y N
343 1.74 73.5 No Y Y
350 1.21 70.9 No Y N
359 1.40 74.7 No Y Y
366 1.42 79.3 No Y Y
370 1.28 78.7 No Y Y
372 1.27 67.0 No Y Y
376 1.44 74.7 No Y Y
392 1.42 80.2 No Y Y
397 1.54 74.7 No Y N
411 1.49 74.8 No Y N
419 1.66 67.0 No Y Y
434 1.32 74.4 No Y N
435 1.53 79.8 No Y Y
436 1.28 74.9 BA - 1 Y N
445 1.48 74.7 No Y Y
446 1.57 56.3 No Y Y
455 1.53 74.1 No Y Y
458 1.57 74.8 No Y Y
459 1.48 77.5 No Y Y
460 1.49 77.5 No Y Y
</TABLE>
B-26
<PAGE>
First Union-Lehman Brothers-Bank of America Commercial Mortgage Trust 1998-C2
Servicing & Pooling
Bank of America Pool
<TABLE>
<CAPTION>
Mortgage
Loan
Number Property Name Address
(i) (ii) (ii)
<S> <C> <C>
463 Canoga Apartments 10400 East Canoga Avenue
468 Arrow Press Properties 52-60 West 200 South Street
469 Northbrook Apartments 584 East Bullard Ave.
472 Sunnyside Acres Mobile Home Park 905 West Sunnyside Road
476 901 W. Jackson Boulevard 901 W Jackson Boulevard
481 Stone Pine Center 20-40 Stone Pine Road
484 The Aspens 10130 Donner Trail Road
485 Casa Del Sol 951-969 Contra Costa Blvd.
488 Springwood Village Shopping Center 6-48 West 7200 South
506 Katella/Knott Shopping Center 7003-7063 Katella Avenue
510 825 Pine Street Apartments 825 Pine Street
511 Ocean Villa Townhomes #1 4330-4204 Dallas Drive
513 Burbank Villas Apartments 14640 Burbank Blvd
517 Sunrise Condominiums 550 El Camino Real
520 Inbus Engineering Building 6233 Industrial Way
523 Cedars St. Paul Apts. 1276 Wilson Avenue
524 McClintock Office Plaza 4700 S. McClintock Drive
535 Palms Apartments 11007- Palms Blvd
543 Kling Street Apartments 11922 Kling Street
549 Target Center 15329 Palmdale Blvd.
560 Spa Business Center 145-155 East 6100 South
569 Duna Vista Mobile Home Park 2400 Cienega
570 Calvert Apartments 11434-11450 Calvert Street
571 177 E. Evelyn Avenue 177 E. Evelyn Avenue
572 Oakland State Garage 401 27Th Street
574 Park Rochester Apartments 11425 Rochester Avenue
575 West Town Professional Center 21675 Longview Drive
585 10051 Pasadena Avenue 10051 Pasadena Avenue
586 Clifford Pacific Business Park 20382 & 20412 Barents Sea Circle
590 Canon Perdido 433 E. Canon Perdido Street
591 Panorama Medical Arts Building 8215 Van Nuys Blvd
598 La Tijera Manor Apartments 7100-7124 Alvern Street
599 Applied Companies Building 28020 Avenue Standford
609 University Court Apartments 1414 3Rd Street South
610 Patrick Business Park 6165 Annie Oakley Drive
613 Ocean Villa Townhomes #3 4401-4601 Dallas Drive
618 Brookhill Plaza 1787 Fort Union Blvd
620 2715 Agate Court 2175 Agate Court
621 Townsgate Atrium 2277 Townsgate Road
623 Edison Apartments 5651 East Edison Street
626 A-Advance Self-Storage 301 West Indian School Road
633 Morningside Square Apartments 2401-2414 Shakespeare Road
638 Westgate Apartments 8721 Owensmouth Avenue
639 Broadmoor Apartments 725 S. Tucson Blvd
641 William Tell Apartments 203 Eden Drive
642 13Th South Self Storage 1150 South 500 West
645 Haverford Apartments 870 North Haverford Avenue
654 Northpointe Apartments 1329-1357 No. Redwood Road
656 514 - 524 Huron Blvd. SE 514 - 524 Huron Boulevard, SE
657 4030 Pacheco Boulevard 4030 Pacheco Boulevard
659 Las Flores Apartments 145 South Avenue B
662 325 North Howard Street 325 North Howard Street
665 1416-1430 S. Main Street 1416-1430 S. Main Street
668 Villa Apartments 1111 7Th Street South
670 Blockbuster Video Store 6324 Custer Road
676 Branford Apartments 12850 Bradford Street
<CAPTION>
Mortgage Monthly Stated
Loan Cut-Off Date Payment Due Mortgage Remaining Maturity
Number City State Zip Balance (on 1st Due Date) Rate Term Date or ARD
(i) (ii) (ii) (ii) (iii) (iv) (v) (vi) (vi)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
463 Chatsworth CA 91311 2,090,173.44 14,131.08 7.1130 114 11/01/07
468 Salt Lake City UT 84101 2,064,387.08 15,187.48 7.9990 116 01/01/08
469 Fresno CA 93710 2,057,124.09 13,914.77 7.1510 118 03/01/08
472 Idaho Falls ID 83402 2,022,107.75 13,551.35 7.0580 118 03/01/08
476 Chicago IL 60607 1,993,832.91 13,787.61 7.3560 116 01/01/08
481 Half Moon Bay CA 94019 1,989,373.41 15,123.65 7.7630 115 12/01/07
484 Truckee CA 96161 1,947,409.68 13,436.28 7.3510 118 03/01/08
485 Pleasant Hill CA 94523 1,946,082.26 14,633.03 7.6750 118 03/01/08
488 Midvale UT 84047 1,943,757.63 14,252.71 7.9590 115 12/01/07
506 Stanton CA 90680 1,888,355.34 17,472.09 7.3690 178 03/01/13
510 San Francisco CA 94108 1,862,440.71 13,456.40 7.7960 114 11/01/07
511 Oxnard CA 93033 1,847,448.95 12,558.83 7.2010 118 03/01/08
513 Los Angeles CA 91411 1,824,386.08 12,217.72 7.0510 118 03/01/08
517 Burlingame CA 94010 1,794,157.35 12,091.72 7.0960 116 01/01/08
520 Livermoore CA 94550 1,777,871.31 16,590.22 7.4060 176 01/01/13
523 St. Paul MN 55106 1,757,481.94 11,769.67 7.0510 118 03/01/08
524 Tempe AZ 85282 1,748,704.62 12,251.84 7.5130 119 04/01/08
535 Los Angeles CA 90034 1,697,751.38 11,733.37 7.3680 118 03/01/08
543 Los Angeles CA 91607 1,635,711.37 11,048.98 7.1250 117 02/01/08
549 Victorville CA 92392 1,596,484.25 11,514.45 7.2010 118 03/01/08
560 Murray UT 84107 1,545,038.11 11,329.08 7.9590 115 12/01/07
569 Oceano CA 93445 1,486,040.28 13,703.94 7.2630 177 02/01/13
570 North Hollywood CA 91606 1,470,406.50 10,118.19 7.3060 116 01/01/08
571 Mountain View CA 94041 1,467,025.62 10,995.46 7.6380 118 03/01/08
572 Oakland CA 94612 1,462,085.02 12,021.78 7.6540 115 12/01/07
574 Los Angeles CA 90025 1,453,916.87 9,736.73 7.0510 118 03/01/08
575 Brookfield WI 53205 1,446,464.48 10,173.38 7.5350 117 02/01/08
585 Cupertino CA 95014 1,397,163.99 10,466.38 7.6320 118 03/01/08
586 Lake Forest CA 92630 1,396,259.85 9,314.23 7.0000 81 02/01/05
590 Santa Barbara CA 93101 1,373,982.61 9,628.33 7.5150 119 04/01/08
591 Panorama City CA 91402 1,365,634.97 10,033.48 7.9800 115 12/01/07
598 Los Angeles CA 90045 1,298,280.46 8,972.58 7.3680 118 03/01/08
599 Santa Clarita CA 91355 1,297,300.01 9,607.73 7.5010 118 03/01/08
609 Minneapolis MN 55454 1,230,003.85 8,559.29 6.7840 117 02/01/08
610 Las Vegas NV 89120 1,225,749.60 8,697.40 7.6150 115 12/01/07
613 Oxnard CA 93033 1,198,345.26 8,146.27 7.2010 118 03/01/08
618 Salt Lake City UT 84121 1,158,791.94 8,509.76 7.9750 115 12/01/07
620 Simi Valley CA 93065 1,147,038.62 7,817.75 7.2150 117 02/01/08
621 Thousand Oaks CA 91361 1,130,478.49 8,220.09 7.8630 114 11/01/07
623 Tucson AZ 85712 1,102,685.96 7,459.73 7.1340 116 01/01/08
626 Phoenix AZ 85013 1,083,699.73 10,425.36 7.8630 175 12/01/12
633 Houston TX 77030 1,044,004.88 7,651.14 7.3410 115 12/01/07
638 Canoga Park CA 91304 997,277.19 6,578.65 6.8890 117 02/01/08
639 Tucson AZ 85716 997,248.62 6,537.91 6.8280 117 02/01/08
641 Longview TX 75605 993,266.00 7,389.91 7.5000 114 11/01/07
642 Salt Lake City UT 84101 992,949.59 7,718.16 8.0000 113 10/01/07
645 Pacific Palisades CA 90272 970,329.45 6,862.13 7.5670 113 10/01/07
654 Salt Lake City UT 84116 886,820.11 6,118.07 7.3500 118 03/01/08
656 Minneapolis MN 55414 862,793.79 5,836.10 7.1510 118 03/01/08
657 Martinez CA 94553 834,233.40 5,904.55 7.6000 117 02/01/08
659 Yuma AZ 85364 817,376.30 5,548.87 7.1690 116 01/01/08
662 Glendale CA 91206 773,913.25 5,225.50 7.1330 118 03/01/08
665 Milpitas CA 95035 758,402.60 5,585.72 7.4380 118 03/01/08
668 Minneapolis MN 55415 737,006.36 5,128.64 6.7840 117 02/01/08
670 Plano TX 75023 695,387.84 5,577.75 8.3750 113 10/01/07
676 Arleta CA 91331 408,723.18 2,812.51 7.3060 116 01/01/08
<CAPTION>
Remaining ARD
Amortization Additional
Mortgage Term (in Master Additional Interest
Loan the case of Ground Servicing Servicing ARD Rate Accrual Mortgage
Number Balloon loan) Lease Fee(%) Fee (%) Loan (%) Basis Loan Seller CTL
(i) (vii) (viii) (ix) (ix) (x) (x) (xi) (xii) (xiii)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
463 354 N 0.0900 0.0050 N - Act/360 Bank of America
468 356 N 0.0900 0.0050 N - Act/360 Bank of America
469 358 N 0.0900 0.0050 N - Act/360 Bank of America
472 358 N 0.0900 0.0050 N - Act/360 Bank of America
476 356 N 0.0900 0.0050 N - Act/360 Bank of America
481 295 N 0.0900 0.0050 N - Act/360 Bank of America
484 358 N 0.0900 0.0050 N - Act/360 Bank of America
485 298 N 0.0900 0.0050 N - Act/360 Bank of America
488 355 N 0.0900 0.0050 N - Act/360 Bank of America
506 N 0.0900 0.0050 N - 30/360 Bank of America
510 354 N 0.0900 0.0050 N - Act/360 Bank of America
511 358 N 0.0900 0.0050 N - Act/360 Bank of America
513 358 N 0.0900 0.0050 N - Act/360 Bank of America
517 356 N 0.0900 0.0050 N - Act/360 Bank of America
520 N 0.0900 0.0050 N - 30/360 Bank of America
523 358 N 0.0900 0.0050 N - Act/360 Bank of America
524 359 N 0.0900 0.0050 N - Act/360 Bank of America
535 358 N 0.0900 0.0050 N - Act/360 Bank of America
543 357 N 0.0900 0.0050 N - Act/360 Bank of America
549 298 N 0.0900 0.0050 N - Act/360 Bank of America
560 355 N 0.0900 0.0050 N - Act/360 Bank of America
569 N 0.0900 0.0050 N - 30/360 Bank of America
570 356 N 0.0900 0.0050 N - Act/360 Bank of America
571 298 N 0.0900 0.0050 N - Act/360 Bank of America
572 235 N 0.0900 0.0050 N - Act/360 Bank of America
574 358 N 0.0900 0.0050 N - Act/360 Bank of America
575 357 N 0.0900 0.0050 N - Act/360 Bank of America
585 298 N 0.0900 0.0050 N - Act/360 Bank of America
586 357 N 0.0900 0.0050 N - Act/360 Bank of America
590 359 N 0.0900 0.0050 N - Act/360 Bank of America
591 355 N 0.0900 0.0050 N - Act/360 Bank of America
598 358 N 0.0900 0.0050 N - Act/360 Bank of America
599 298 N 0.0900 0.0050 N - Act/360 Bank of America
609 297 N 0.0900 0.0050 N - Act/360 Bank of America
610 355 N 0.0900 0.0050 N - Act/360 Bank of America
613 358 N 0.0900 0.0050 N - Act/360 Bank of America
618 355 N 0.0900 0.0050 N - Act/360 Bank of America
620 357 N 0.0900 0.0050 N - Act/360 Bank of America
621 354 N 0.0900 0.0050 N - Act/360 Bank of America
623 356 N 0.0900 0.0050 N - Act/360 Bank of America
626 N 0.0900 0.0050 N - 30/360 Bank of America
633 295 N 0.0900 0.0050 N - Act/360 Bank of America
638 357 N 0.0900 0.0050 N - Act/360 Bank of America
639 357 N 0.0900 0.0050 N - Act/360 Bank of America
641 294 N 0.0900 0.0050 N - Act/360 Bank of America
642 293 N 0.0900 0.0050 N - Act/360 Bank of America
645 353 N 0.0900 0.0050 N - Act/360 Bank of America
654 358 N 0.0900 0.0050 N - Act/360 Bank of America
656 358 N 0.0900 0.0050 N - Act/360 Bank of America
657 357 N 0.0900 0.0050 N - Act/360 Bank of America
659 356 N 0.0900 0.0050 N - Act/360 Bank of America
662 358 N 0.0900 0.0050 N - Act/360 Bank of America
665 298 N 0.0900 0.0050 N - Act/360 Bank of America
668 297 N 0.0900 0.0050 N - Act/360 Bank of America
670 293 N 0.0900 0.0050 N - Act/360 Bank of America
676 356 N 0.0900 0.0050 N - Act/360 Bank of America
<CAPTION>
Lease Residual Debt
Mortgage Enhance- Value Service Loan Interest
Loan CTL ment Insurance Coverage to Value Cross Defea- Reserve
Number Guarantor Policy Policy Ratio (x) Ratio Defaulted sance Loan
(i) (xiii) (xiv) (xiv) (xv) (xv) (xvi) (xvii) (xviii)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
463 1.43 74.9 No Y Y
468 1.11 75.1 BA - 1 Y N
469 1.34 69.0 No Y Y
472 1.31 74.9 No Y Y
476 1.54 68.8 No Y Y
481 1.51 69.8 No Y N
484 1.25 77.0 No Y Y
485 1.57 56.4 No Y N
488 1.30 74.8 BA - 1 Y N
506 1.45 53.7 No Y N
510 1.20 70.0 No Y N
511 1.40 80.3 No Y Y
513 1.34 73.0 No Y Y
517 1.30 64.7 No Y Y
520 1.38 53.2 No Y N
523 1.51 78.1 No Y Y
524 1.34 74.4 No Y Y
535 1.34 74.8 No Y Y
543 1.28 79.8 No Y Y
549 1.56 74.6 No Y Y
560 1.33 74.5 BA - 1 Y N
569 1.14 55.0 No Y N
570 1.50 79.9 No Y Y
571 1.53 69.9 No Y N
572 1.42 75.0 No Y N
574 1.54 56.6 No Y Y
575 1.48 72.3 No Y Y
585 1.38 65.0 No Y N
586 1.36 72.1 No Y Y
590 1.29 65.4 No Y Y
591 1.36 78.0 No Y N
598 1.45 74.2 No Y Y
599 1.65 59.5 No Y Y
609 1.55 76.9 No Y Y
610 1.34 75.9 No Y N
613 1.47 76.8 No Y Y
618 1.31 74.8 BA - 1 Y N
620 1.38 54.6 No Y Y
621 1.44 70.7 No Y N
623 1.38 77.1 No Y Y
626 1.38 63.8 No Y N
633 1.45 74.6 No Y Y
638 1.70 64.8 No Y Y
639 1.58 66.5 No Y Y
641 1.42 66.2 No Y Y
642 1.46 59.5 No Y N
645 1.19 65.6 No Y Y
654 1.38 79.9 No Y Y
656 1.31 79.9 No Y Y
657 1.42 74.8 No Y N
659 1.47 76.4 No Y Y
662 1.26 77.4 No Y Y
665 1.74 55.8 No Y Y
668 1.39 69.9 No Y Y
670 1.32 63.2 No Y N
676 1.42 80.1 No Y Y
</TABLE>
B-27
<PAGE>
SCHEDULE I
General Mortgage Representations and Warranties
(i) The information pertaining to each Mortgage Loan set forth in
the Mortgage Loan Schedule was true and correct in all material respects as of
the Cut-Off Date;
(ii) If such Mortgage Loan was originated by the Seller or an
affiliate thereof, then, as of the date of its origination, such Mortgage Loan
complied in all material respects with, or was exempt from, all requirements of
federal, state or local law relating to the origination of such Mortgage Loan;
and, if such Mortgage Loan was not originated by the Seller or an affiliate
thereof, then, to the best of the Seller's knowledge after having performed the
type of due diligence customarily performed by prudent institutional commercial
and multifamily mortgage lenders, as of the date of its origination, such
Mortgage Loan complied in all material respects with, or was exempt from, all
requirements of federal, state or local law relating to the origination of such
Mortgage Loan;
(iii) The Seller owns the Mortgage Loan, has good and marketable
title thereto, has full right and authority to sell, assign and transfer the
Mortgage Loan and is transferring the Mortgage Loan free and clear of any and
all liens, pledges, charges or security interests of any nature encumbering such
Mortgage Loan, and no provision of the Mortgage Note, Mortgage or other loan
document relating to such Mortgage Loan prohibits or restricts the Seller's
right to assign or transfer such Mortgage Loan;
(iv) The proceeds of such Mortgage Loan have been fully disbursed
and there is no requirement for future advances thereunder;
(v) Each of the related Mortgage Note, Mortgage(s), Assignment of
Leases, if any, and other agreements executed in connection therewith is the
legal, valid and binding obligation of the maker thereof (subject to any
non-recourse provisions therein and any state anti-deficiency legislation),
enforceable in accordance with its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally, and by general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law);
(vi) As of the date of its origination, there was no valid offset,
defense, counterclaim or right to rescission with respect to any of the related
Mortgage Note, Mortgage(s) or other agreements executed in connection therewith,
and, as of the
<PAGE>
Cut-off Date, to the best knowledge of the Seller, there is no valid offset,
defense, counterclaim or right to rescission with respect to such Mortgage Note,
Mortgage(s) or other agreements;
(vii) The assignment of the related Mortgage and Assignment of
Leases to the Trustee constitutes the legal, valid, binding and enforceable
assignment of such Mortgage in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally, and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law);
(viii) Except with respect to the Mortgage Loans listed in Exhibit
I-VIII hereto, each related Mortgage is a valid and enforceable first lien on
the related Mortgaged Property, which Mortgaged Property is free and clear of
all encumbrances and liens having priority over or on a parity with the first
lien of such Mortgage, except for (a) liens for real estate taxes and special
assessments not yet due and payable, (b) covenants, conditions and restrictions,
rights of way, easements and other matters of public record as of the date of
recording of such Mortgage, such exceptions appearing of record being
customarily acceptable to mortgage lending institutions generally or
specifically reflected in the appraisal of such Mortgaged Property made in
connection with the origination of such Mortgage Loan, and (c) other matters to
which like properties are commonly subject and which do not, individually or in
the aggregate, materially interfere with the benefits of the security intended
to be provided by such Mortgage or materially affect the value or marketability
of such Mortgaged Property, and such encumbrances do not materially interfere
with the current use or operation of the related Mortgaged Property and, except
with respect to the Mortgage Loans listed in Exhibit I-VIII hereto, there exists
with respect to such Mortgaged Property an assignment of leases and rents
provision, whether as part of the related Mortgage or as a separate document or
instrument, which establishes and creates a first priority security interest in
and to leases and rents arising in respect of the related Mortgaged Property,
subject only to encumbrances described in subsections (a), (b) and (c) of this
subparagraph (viii);
(ix) The Seller has filed and/or recorded in all appropriate public
filing and recording offices all UCC-1 financing statements necessary to create
and perfect a security interest in and lien on the items of personal property
described therein (or, if not filed and/or recorded, has submitted such UCC-1
financing statements for filing and/or recording and such UCC-1 financing
statements are in form and substance acceptable for filing and/or recording), to
the extent perfection may be effected pursuant to applicable law by recording or
filing;
-2-
<PAGE>
(x) All taxes and governmental assessments that prior to the Cut-off
Date became due and owing in respect of, and affect, each related Mortgaged
Property have been paid, or an escrow of funds in an amount sufficient to cover
such payments has been established;
(xi) As of the date of its origination, there was no proceeding
pending for the total or partial condemnation of each related Mortgaged Property
that materially affects the value thereof, and such Mortgaged Property was free
of material damage; and, as of the Cut-off Date, the Seller has not received any
notice of the commencement of any proceeding for the total or partial
condemnation of any related Mortgaged Property that materially affects the value
thereof, and such Mortgaged Property is free of material damage;
(xii) Each related Mortgaged Property is covered by an ALTA (or its
equivalent) lender's title insurance policy insuring that each related Mortgage
is a valid first lien on such Mortgaged Property in the original principal
amount of the Mortgage Loan after all advances of principal, or there is a
binding commitment from a title insurer qualified and licensed in the applicable
jurisdiction, as required, to issue such policy; such title insurance policy, if
issued, is in full force and effect, is freely assignable and will inure solely
to the benefit of the Trustee as mortgagee of record, or any such commitment is
a legal, valid and binding obligation of such insurer; no claims have been made
under such title insurance policy, if issued; and to the best knowledge of the
Seller, no prior mortgagee has done, by act or omission, anything which would
materially impair the coverage of any such title insurance policy;
(xiii) As of the date of its origination, all insurance required
under each related Mortgage, which insurance covered such risks as were
customarily acceptable to prudent commercial and multifamily mortgage lending
institutions lending on the security of property comparable to the related
Mortgaged Property in the jurisdiction in which such Mortgaged Property is
located, and with respect to a fire and extended perils insurance policy, was in
an amount (subject to a customary deductible) at least equal to 100% of the full
insurable replacement cost of the improvements located on such Mortgaged
Property (except to the extent not permitted by applicable law and then in such
event in an amount in excess of the initial principal balance of the Mortgage
Loan, together with an "agreed value endorsement"), was in full force and effect
with respect to each related Mortgaged Property; and, as of the Cut-off Date, to
the best knowledge of the Seller, all insurance required under each Mortgage,
which insurance covers such risks and is in such amounts as are customarily
acceptable to prudent commercial and multifamily mortgage lending institutions
lending on the security of property comparable to the related Mortgaged Property
in the jurisdiction in which such Mortgaged Property is located, is in full
force and effect with respect to each related Mortgaged Property; and no
-3-
<PAGE>
notice of termination or cancellation with respect to any such insurance policy
has been received by the Seller; except for certain amounts not greater than
amounts which would be considered prudent by an institutional commercial
mortgage lender with respect to a similar mortgage loan and which are set forth
in the related Mortgage, any insurance proceeds in respect of a casualty loss or
taking, will be applied either to the repair or restoration of all or part of
the related Mortgaged Property or the reduction of the outstanding principal
balance of the Mortgage Loan;
(xiv) Other than payments due but not yet 30 days or more
delinquent, there is, to the best of the Seller's knowledge, (A) no material
default, breach, violation or event of acceleration existing under the related
Mortgage Note or each related Mortgage, and no event which, with the passage of
time or with notice and (B) the expiration of any grace or cure period, would
constitute a material default, breach, violation or event of acceleration under
any of such documents; the Seller has not waived any other material default,
breach, violation or event of acceleration under any of such documents; and
under the terms of each Mortgage Loan, each related Mortgage Note, each related
Mortgage and the other loan documents in the related Mortgage File, no person or
party other than the mortgagee may declare an event of default or accelerate the
related indebtedness under such Mortgage Loan, Mortgage Note or Mortgage;
(xv) As of the Cut-off Date, the Mortgage Loan is not, and in the
prior 12 months (or since the date of origination if such Mortgage Loan has been
originated within the past 12 months), has not been, 30 days or more past due in
respect of any Scheduled Payment;
(xvi) Except with respect to the Mortgage Loans listed in Exhibit
I-XVI hereto which accrue interest on the basis of the actual number of days
elapsed over a 360 day year, the Mortgage Loan accrues interest (payable monthly
in arrears) at a fixed rate of interest (except with respect to ARD Loans, with
respect to which the rate at which interest accrues thereon increases after the
Anticipated Repayment Date, except with respect to the Mortgage Loans listed in
Exhibit I-XVI hereto and except in connection with the occurrence of a default
and the accrual of default interest) on the basis of a 360-day year consisting
of twelve 30-day months;
(xvii) Each related Mortgage does not provide for or permit, without
the prior written consent of the holder of the Mortgage Note, each related
Mortgaged Property to secure any other promissory note or obligation, except as
expressly described in such Mortgage and other than another Mortgage Loan in the
Trust Fund;
(xviii) Such Mortgage Loan is or constitutes part of a "qualified
mortgage" within the meaning of Section
-4-
<PAGE>
860G(a)(3) of the Code. Accordingly, either as of the date of origination or the
Closing Date, the fair market value of the real property securing the Mortgage
Loan was not less than 80% of the "adjusted issue price" (within the meaning of
the REMIC Provisions) of such Mortgage Loan. For purposes of the preceding
sentence, the fair market value of the real property securing the Mortgage Loan
was first reduced by the amount of any lien on such real property that is senior
to the lien that secures such Mortgage Loan, and was further reduced by a
proportionate amount of any lien that is on a parity with the lien that secures
such Mortgage Loan;
(xix) Prepayment Premiums and Yield Maintenance Charges payable with
respect to the Mortgage Loan, if any, constitute "customary prepayment
penalties" within the meaning of Treasury Regulation Section 1.860G-1(b)(2);
(xx) One or more environmental site assessments were performed by an
environmental consulting firm independent of the Seller and the Seller's
affiliates with respect to each related Mortgaged Property during the 18-month
period preceding the Cut-off Date, and the Seller, having made no independent
inquiry other than to review the report(s) prepared in connection with the
assessment(s) referenced herein, has no knowledge of any material and adverse
environmental condition or circumstance affecting such Mortgaged Property that
was not disclosed in such report(s);
(xxi) The related Mortgage Note, Mortgage(s) and Assignment(s) of
Leases, if any, contain customary and enforceable provisions such as to render
the rights and remedies of the holder thereof adequate for the realization
against the related Mortgaged Property or Properties of the benefits of the
security, including realization by judicial or, if applicable, non-judicial
foreclosure, subject to applicable reorganization, insolvency, moratorium and
other similar laws affecting creditors' rights generally as from time to time,
in effect, and to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(xxii) To the best of the Seller's knowledge, after due inquiry, the
related Mortgagor is not a debtor in any bankruptcy, reorganization, insolvency
or comparable proceeding;
(xxiii) Such Mortgage Loan is secured by either a mortgage on a fee
simple interest or a leasehold estate in a commercial property or multifamily
property, including the related Mortgagor's interest in the improvements on the
related Mortgaged Property;
(xxiv) Unless such Mortgage Loan is an ARD Loan, such Mortgage Loan
does not provide for negative amortization;
-5-
<PAGE>
(xxv) Such Mortgage Loan is a whole loan, contains no equity
participation by the lender or shared appreciation feature and does not provide
for any contingent or additional interest in the form of participation in the
cash flow of the related Mortgaged Property;
(xxvi) The related Mortgage contains provisions for the acceleration
of the payment of the unpaid principal balance of such Mortgage Loan if, without
the prior written consent of the mortgagee, any related Mortgaged Property or
interest therein, is directly or indirectly encumbered in connection with
subordinate financing; provided, however, the Mortgage Loans listed in Exhibit
I-XXVI hereto, are encumbered by subordinated debt;
(xxvii) Except with respect to (W) transfers of certain
non-controlling interests in the Mortgagors as specified in the related
Mortgage, (X) the Mortgage Loans listed in Exhibit I-XXVII hereto, which permit
one or more transfers of the related Mortgaged Property to a person that
satisfies certain criteria (including criteria related to bankruptcy remoteness
and property management experience) specified in the related Mortgage, (Y) the
Mortgage Loans listed in Exhibit I-XXVII hereto, which permit a one-time
transfer of the Mortgaged Property, subject to payment of an assumption fee and
certain other conditions, and (Z) the Mortgage Loans listed in Exhibit I-XXVII
hereto, which permit two or more separate transfers of the related Mortgaged
Property, subject to payment of an assumption fee and certain other conditions,
the related Mortgage contains either (A) provisions for the acceleration of the
payment of the unpaid principal balance of such Mortgage Loan if any related
Mortgaged Property or interest therein is directly or indirectly transferred or
sold without the prior written consent of the mortgagee, or (B) provisions for
the acceleration of the payment of the unpaid principal balance of such Mortgage
Loan if any related Mortgaged Property or interest therein is directly or
indirectly transferred or sold without the related Mortgagor having satisfied
certain conditions specified in the related Mortgage with respect to permitted
transfers;
(xxviii) The Mortgage Loan, together with any other Mortgage Loan
made to the same Mortgagor or to an affiliate of such Mortgagor, does not
represent more than 5% of the aggregate Initial Pool Balance;
(xxix) Except as set forth in the related Mortgage File, the terms
of the related Mortgage Note and Mortgage(s) have not been waived, modified,
altered, satisfied, impaired, canceled, subordinated or rescinded in any manner
which materially interferes with the security intended to be provided by such
Mortgage;
-6-
<PAGE>
(xxx) Each related Mortgaged Property was inspected by or on behalf
of the related originator during the 12 month period prior to the related
origination date;
(xxxi) Except for the Mortgage Loans listed in Exhibit I-XXXI
hereto, the terms of the related Mortgage Note or Mortgage do not provide for
the release of any material portion of the related Mortgaged Property from the
lien of such Mortgage without payment in full of the Mortgage Loan;
(xxxii) The related Mortgagor has covenanted in the Mortgage Loan
documents to maintain the related Mortgaged Property in compliance with all
applicable laws, zoning ordinances, rules, covenants and restrictions affecting
the construction, occupancy, use and operation of such Mortgaged Property, and
the related originator performed the type of due diligence in connection with
the origination of such Mortgage Loan customarily performed by prudent
institutional commercial and multifamily mortgage lenders with respect to the
foregoing matters; the Seller has received no notice of any material violation
of any applicable laws, zoning ordinances, rules, covenants or restrictions
affecting the construction, occupancy, use or operation of such Mortgaged
Property; to the Seller's knowledge (based on surveys and/or title insurance
obtained in connection with the origination of such Mortgage Loan), as of the
date of such origination, no improvement that was included for the purpose of
determining the appraised value of the related Mortgaged Property at the time of
origination of such Mortgage Loan lay outside the boundaries and building
restriction lines of such property to an extent which would have a material
adverse affect on the related Mortgagor's use and operation of such Mortgaged
Property (unless affirmatively covered by the title insurance referred to in
paragraph (xii) above), and no improvements on adjoining properties encroached
upon such Mortgaged Property to any material extent;
(xxxiii) Except with respect to Credit Lease Loans, the related
Mortgagor has covenanted in the Mortgage Loan documents to deliver each year to
the mortgagee an operating statement of each related Mortgaged Property covering
the twelve-month period identified therein;
(xxxiv) With respect to at least 95% of the Mortgage Loans (by
balance) having a Cut-off Date Balance in excess of 1% of the Initial Pool
Balance, the related Mortgagor has covenanted in its organizational documents
and/or the Mortgage Loan documents to own no significant asset other than the
related Mortgaged Property or Mortgaged Properties, as applicable, and assets
incidental to its ownership and operation of such Mortgaged Property;
(xxxv) No advance of funds has been made, directly or indirectly, by
the Seller to the Mortgagor other than pursuant to the Mortgage Note and no
funds have been received
-7-
<PAGE>
from any person other than such Mortgagor for or on account of payments due on
the Mortgage Note;
(xxxvi) To the Seller's actual knowledge, there are no pending
actions, suits or proceedings by or before any court or governmental authority
against or affecting the related Mortgagor or the related Mortgaged Property
that, if determined adversely to such Mortgagor or Mortgaged Property, would
materially and adversely affect the value of the Mortgaged Property or the
ability of the Mortgagor to pay principal, interest or any other amounts due
under such Mortgage Loan;
(xxxvii) Such Mortgage Loan complied with all applicable usury laws
in effect at its date of origination;
(xxxviii) To the extent required under applicable law as of the
Closing Date, the originator of such Mortgage Loan was authorized to do business
in the jurisdiction in which the related Mortgaged Property is located at all
times when it held the Mortgage Loan to the extent necessary to ensure the
enforceability of such Mortgage Loan;
(xxxix) If the related Mortgage is a deed of trust, a trustee, duly
qualified under applicable law to serve as such, is properly designated and
serving under such Mortgage;
(xl) The related Mortgage Note is not secured by any collateral that
secures a mortgage loan that is not in the Trust Fund (except with respect to
the Mortgage Loans listed in Exhibit I-XL hereto), and each Mortgage Loan that
is cross-collateralized is cross-collateralized only with other Mortgage Loans
sold pursuant to this Agreement;
(xli) The related Mortgaged Property either is not located in a
flood hazard area as defined by the Federal Insurance Administration or is
covered by flood hazard insurance;
(xlii) Except with respect to the Mortgage Loans listed on Exhibit
I-XLII hereto, one or more engineering assessments were performed by an
engineering consulting firm independent of the Seller and the Seller's
affiliates with respect to each related Mortgaged Property during the 18-month
period preceding the Cut-off Date, and the Seller, having made no independent
inquiry other than to review the report(s) prepared in connection with the
assessment(s) referenced herein, has no knowledge of any material and adverse
engineering condition or circumstance affecting such Mortgaged Property that was
not disclosed in such report(s);
(xliii) All escrow deposits and payments relating to the Mortgage
Loan are under control of the Seller or the servicer of such Mortgage Loan and
all amounts required as of the date hereof under the Mortgage Loan Documents to
be deposited by the related Mortgagor have been deposited;
-8-
<PAGE>
(xliv) The related Mortgagor has represented to the Seller that as
of the date of origination of the Mortgage Loan, such Mortgagor, the related
lessee, franchisor or operator was in possession of all licenses, permits and
authorizations then required for use of the related Mortgaged Property, which
were valid and in full force and effect; and
(xlv) The origination, servicing and collection practices used by
the Seller or any prior holder of the Mortgage Note have been in all respects
legal and have met customary industry standards.
(xlvi) Except as set forth in Schedule II, the Mortgage Loan is
secured in whole or in part by a fee simple interest.
-9-
<PAGE>
SCHEDULE II
Ground Lease Representations and Warranties
(i) With respect to any Mortgage Loan that is secured in whole or in
material part by the interest of a Mortgagor as a lessee under a Ground Lease
but not by the related fee interest:
(A) Such Ground Lease or a memorandum thereof has been or will be duly
recorded (other than the Ground Lease related to the Mortgage Loan listed
in Exhibit II-A hereto) and such Ground Lease permits the interest of the
lessee thereunder to be encumbered by the related Mortgage or, if consent
of the lessor thereunder is required, it has been obtained prior to the
Closing Date;
(B) Upon the foreclosure of the Mortgage Loan (or acceptance of a deed in
lieu thereof), the Mortgagor's interest in such Ground Lease is assignable
to the Trustee without the consent of the lessor thereunder (or, if any
such consent is required, it has been obtained prior to the Closing Date)
and, in the event that it is so assigned, is further assignable by the
Trustee and its successors without a need to obtain the consent of such
lessor; provided, that the lessor's consent to a subsequent sale is
required under the Ground Lease related to the Mortgage Loans listed in
Exhibit II-B hereto;
(C) Such Ground Lease may not be amended, modified, canceled or terminated
without the prior written consent of the Mortgagee thereunder and that any
such action without such consent is not binding on such Mortgagee, its
successors or assigns;
(D) Unless otherwise set forth in the Ground Lease, the Ground Lease does
not permit any increase in the amount of rent payable by the ground lessee
thereunder during the term of the Mortgage Loan;
(E) Such Ground Lease was in full force and effect as of the date of
origination of the related Mortgage Loan, and to the actual knowledge of
the Seller, at the Closing Date, such Ground Lease is in full force and
effect and other than payments due but not yet 30 days or more delinquent,
(1) there is no material default, and (2) there is no event which, with
the passage of time or with notice and the expiration of any grace or cure
period, would constitute a material default under such Ground Lease;
(F) Such Ground Lease or an estoppel or consent letter received by the
Mortgagee from the lessor, requires the lessor thereunder to give notice
of any default by the lessee to the Mortgagee; and such Ground Lease, or
an
-10-
<PAGE>
estoppel or consent letter received by the Mortgagee from the lessor,
further provides either (1) that no notice of termination given under such
Ground Lease is effective against the Mortgagee unless a copy has been
delivered to the Mortgagee in the manner described in such Ground Lease,
estoppel or consent letter or (2) that upon any termination of the Ground
Lease the lessor will enter into a new lease with the mortgagee;
(G) The ground lessee's interest in the Ground Lease is not subject to any
liens or encumbrances superior to, or of equal priority with, the related
Mortgage, other than the related ground lessor's related fee interest and
any exceptions stated in the related title insurance policy or opinion of
title, which exceptions do not and will not materially and adversely
interfere with (1) the ability of the related Mortgagor timely to pay in
full the principal and interest on the related Mortgage Note, (2) the use
of such Mortgaged Property for the use currently being made thereof, or
(3) the value of the Mortgaged Property;
(H) A Mortgagee is permitted a reasonable opportunity to cure any curable
default under such Ground Lease before the lessor thereunder may terminate
such Ground Lease;
(I) Such Ground Lease has an original term (together with any extension
options, whether or not currently exercised, set forth therein) that
extends not less than 10 years beyond the Stated Maturity Date of the
related Mortgage Loan;
(J) Except with respect to the Ground Lease related to each of the
Mortgage Loans listed in Exhibit II-J hereto, under the terms of such
Ground Lease, any estoppel or consent letter received by the Mortgagee
from the lessor, and the related Mortgage, taken together, any related
insurance proceeds or condemnation proceeds will be applied either to the
repair or restoration of all or part of the related Mortgaged Property,
with the Mortgagee or a trustee appointed by it having the right to hold
and disburse such proceeds as the repair or restoration progresses, or to
the payment of the outstanding principal balance of the Mortgage Loan
together with any accrued interest thereon;
(K) Such Ground Lease does not impose any restrictions on subletting which
would be viewed as commercially unreasonable by a prudent commercial
mortgage lender;
(L) Except with respect to Mortgage Loans listed on Exhibit II-L hereto,
the ground lessor under such Ground Lease is required to enter into a new
lease upon termination of the Ground Lease for any reason, including the
rejection of the Ground Lease in bankruptcy, and for any reason, upon the
request of the lender; and
-11-
<PAGE>
(M) The terms of the related Ground Lease have not been waived, modified,
altered, satisfied, impaired, canceled, subordinated or rescinded in any
manner which materially interferes with the security intended to be
provided by such Mortgage.
(ii) With respect to Mortgage Loans secured in whole or
in part by the interest of the related mortgagor under a Ground Lease and by the
related fee interest, such fee interest is subject, and subordinated of record,
to the related Mortgage, and such Mortgage does not by its terms provide that it
will be subordinated to the lien of any other mortgage or other lien upon such
fee interest.
-12-
<PAGE>
SCHEDULE III
Health Care Facility Representations and Warranties
With respect to any Mortgage Loan that is secured in whole or in
part by a Mortgage Property which is operated as a residential health care
facility (a "Facility");
(A) All governmental licenses, permits, regulatory agreements or other
approvals or agreements necessary for the use and operation of each
Facility as intended are held by the related Mortgagor or the operator of
the Facility, and are in full force and effect, including, without
limitation, a valid certificate of need ("CON") or similar certificate,
license, or approval issued by the applicable department of health for the
requisite number of beds, and approved provider status in any approved
provider payment program (collectively, the "Licenses").
(B) The Licenses (1) may not be, and have not been, transferred to any
location other than the Facility; (2) have not been pledged as collateral
security for any other loan or indebtedness; and (3) are held free from
restrictions or known conflicts which would materially impair the use or
operation of the Facility as intended, and are not provisional,
probationary or restricted in any way.
(C) As of the Cut-off Date and to Seller's knowledge, without inquiry, (1)
as of the Cut-off Date, the Facility has not received a "Level A" (or
equivalent) violation which has not been cured to the satisfaction of the
applicable governmental agency, and (2) no statement of charges or
deficiencies has been made or penalty enforcement action has been
undertaken against the Facility, its operator or the Mortgagor or against
any officer, director or stockholder of such operator or the Mortgagor by
any governmental agency during the last three calendar years, and there
have been no violations over the past three years which have threatened
the Facility's, the operator's or the Mortgagor's certification for
participation in Medicare or Medicaid or the other third-party payors'
programs.
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<PAGE>
[Schedule IV Reserved]
-14-
<PAGE>
Schedule V
Gentlemen:
I have acted as counsel to [SELLER]. First Union Commercial Mortgage
Securities, Inc. will acquire certain mortgage loans from [seller] pursuant to
the Mortgage Loan Purchase Agreement, dated as of [ ] (the "Mortgage Loan
Purchase Agreement"). Capitalized terms used but not defined herein shall have
the meanings set forth in the Mortgage Loan Purchase Agreement.
You have asked for my opinion regarding the due authorization of
[Seller] to enter into the Mortgage Loan Purchase Agreement.
As to matters of fact material to this opinion, I have relied,
without independent investigation on (i) the representations and warranties of
[SELLER] in the Mortgage Loan Purchase Agreement, (ii) relevant resolutions of
the Board of Directors of [SELLER], (iii) certificates of responsible officers
of [SELLER] and (iv) certificates of public officials.
In this connection, I have examined or have caused to be examined on
my behalf, a copy of the Mortgage Loan Purchase Agreement and such other
documents and instruments which I have deemed necessary or appropriate in
connection with this opinion.
I have relied on originals or copies, certified or otherwise
identified to my satisfaction, of the certificate of incorporation and by-laws
of [SELLER], records of proceedings taken by [SELLER], and such other corporate
documents and records of [SELLER], and have made such other investigations as I
have deemed relevant or necessary for the purpose of this opinion. I have
assumed, without independent investigation, the genuineness of all signatures
(other than those of officers of [SELLER]), the authenticity of all documents
submitted to me as originals and the conformity to original documents of all
documents submitted to me as certified, conformed or reproduction copies.
On the basis of and subject to the foregoing, it is my opinion that:
(1) [SELLER] is a [corporation] duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, with the corporate
power and authority to transact the business contemplated by the Mortgage Loan
Purchase Agreement, and it has the requisite corporate power and authority to.
execute and deliver the Mortgage Loan Purchase Agreement and to perform and
observe the terms and conditions thereof.
-15-
<PAGE>
(2) The Mortgage Loan Purchase Agreement has been duly authorized,
executed and delivered by [SELLER].
(3) The execution, delivery and performance by [SELLER] of the
Mortgage Loan Purchase Agreement will not conflict with, result in a breach of,
or constitute a default under any material term of [SELLER]'s certificate of
incorporation or bylaws, any term or provision of any material contract,
agreement or other instrument known to me to which [SELLER] is a party or by
which it is bound, or, to the best of my knowledge without independent
investigation, any order, judgment, writ, injunction or decree known to me of
any court or governmental authority having jurisdiction over [SELLER].
(4) The Mortgage Loan Purchase Agreement constitutes, assuming due
authorization, execution and delivery by the other party thereto, the valid and
binding obligation of [SELLER] enforceable against [SELLER] in accordance with
its terms, except as such enforcement may be limited by (a) bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the enforcement
of creditors' rights generally, (b) general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law) and
(c) limitations of public policy under applicable securities laws as to rights
of indemnity thereunder.
In furnishing the foregoing opinions, I express no opinion other
than as to the general corporation law of the State of Delaware, the law of the
State of New York and the federal law of the United States of America.
This opinion is being delivered to you for your sole use in
connection with the above-referenced transactions and may not be used or relied
upon by any other person, firm or entity in any other context for any other
purpose. This opinion may not be quoted in whole or in part, nor may copies be
furnished or delivered to any other person without the consent of [SELLER]
except that you may furnish copies to (i) your independent auditors ands
attorneys, (ii) any United States, state or local authority having jurisdiction
over you, (iii) pursuant to the order of any legal process of any court of
competent jurisdiction or governmental agency, and (iv) in connection with any
legal action arising in connection with the above-referenced transactions.
Very truly yours,
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<PAGE>
EXHIBIT B
Exception to Section 2(c)
None
<PAGE>
EXHIBIT I-VIII
EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES OF THE SELLER
REGARDING THE INDIVIDUAL MORTGAGE LOANS
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (v)
(v) Each of the related Mortgage Note, Mortgage(s), Assignment of Leases, if
any, and other agreements executed in connection therewith is the legal,
valid and binding obligation of the maker thereof (subject to any
non-recourse provisions therein and any state anti- deficiency
legislation), enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally, and by general principles of equity (regardless of whether
such enforcement is considered in a proceeding in equity or at law), and
a legal opinion to such effect was obtained by the originator of such
Mortgage Loan at the time of origination;
1. The following Mortgage Loans are the only loans where a legal
opinion was obtained by the originator at the time of origination:
(a) 434 -- Capitol Warehouse Building
(b) 60 -- Sundance West Apartments
(c) 436 -- 6100 Capital Center
(d) 242 -- Lake Loft Center
(e) 300 -- The Pontiac Building
(f) 304 -- Lincoln Arms Apartments
(g) 618 -- Brookhill Plaza
(h) 91 -- La Villita Apartments
(i) 654 -- Northpointe Apartments
<PAGE>
EXHIBIT I-IX
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (ix)
(ix) The Seller has filed and/or recorded in all appropriate public filing and
recording offices all UCC-1 financing statements necessary to create and
perfect a security interest in and lien on the items of personal property
described therein (or, if not filed and/or recorded, has submitted such
UCC-1 financing statements for filing and/or recording and such UCC-1
financing statements are in form and substance acceptable for filing
and/or recording), to the extent perfection may be effected pursuant to
applicable law by recording or filing;
The following are missing UCC-1 filings:
<PAGE>
(a) 654-- Northpointe Apartments.
<PAGE>
EXHIBIT I-XIII
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xiii)
(xiii) As of the date of its origination, all insurance required under each
related Mortgage, which insurance covered such risks as were customarily
acceptable to prudent commercial and multifamily mortgage lending
institutions lending on the security of property comparable to the
related Mortgaged Property in the jurisdiction in which such Mortgaged
Property is located, and with respect to a fire and extended perils
insurance policy, was in an amount (subject to a customary deductible) at
least equal to 100% of the full insurable replacement cost of the
improvements located on such Mortgaged property, was in full force and
effect with respect to each related Mortgaged Property; and, as of the
Cut-off Date, to the best knowledge of the Seller, all insurance required
under each Mortgage, which insurance covers such risks and is in such
amounts as are customarily acceptable to prudent commercial and
multifamily mortgage lending institutions lending on the security of
property comparable to the related Mortgaged Property in the jurisdiction
in which such Mortgaged Property is located, is in full force and effect
with respect to each related Mortgaged Property; and no notice of
termination or cancellation with respect to any such insurance policy has
been received by the Seller; except for certain amounts not greater than
amounts which would be considered prudent by an institutional commercial
mortgage lender with respect to a similar mortgage loan and which are set
forth in the related Mortgage, any insurance proceeds in respect of a
casualty loss or taking, will be applied either to the repair or
restoration of all or part of the related Mortgaged Property or the
reduction of the outstanding principal balance of the Mortgage Loan;
(a) 229 -- L.A. Community College: business interruption coverage
waived by Seller.
(b) The following loans have PML or BML greater than 25% and Seller
waived earthquake insurance:
112 -- Orangebrook Manor Apartments
160 -- Park Encino Apartments
227 -- Tarzana Tennis Club Apartments
513 -- Burbank Villas Apartments
662 -- 325 North Howard Street
<PAGE>
EXHIBIT I-XIV
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xiv)
(xiv) Other than payments due but not yet 30 days or more delinquent, (A) there
is no material default, breach, violation or event of acceleration, and
there is no other material default, breach, violation or event of
acceleration, existing under the related Mortgage Note or each related
Mortgage, and (B) to the best of Seller's knowledge, after due inquiry,
there is no event which, with the passage of time or constitute a
material default, breach, violation or event of acceleration under any of
the documents referred to in clause (A), and, to the knowledge of Seller,
there is no event which, with the passage of time or with notice and the
expiration of any grace or cure period, would constitute any other
material default, breach, violation or event of acceleration under any of
the documents referred to in clause (A); the Seller has not waived any
material default, breach, violation or event of acceleration under any of
the documents referred to in clause (A), and the Seller has not waived
any other material default, breach, violation or event of acceleration
under such documents; and under the terms of each Mortgage Loan, each
related Mortgage Note, each related Mortgage and the other loan documents
in the related Mortgage File, no person or party other than the mortgagee
may declare an event of default or accelerate the related indebtedness
under such Mortgage Loan, Mortgage Note or Mortgage;
(a) 468 --Arrow Press Properties: capital repairs in the amount of
$85,938 were due February 28, 1998; -- past due;
(b) 618 -- Brookhill Plaza: capital repairs in the amount of $55,000
were to be completed by February 28, 1998; -- past due.
<PAGE>
EXHIBIT I-XVI
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xvi)
(xvi) Except with respect to the Mortgage Loans listed below which accrue
interest on the basis of a 360-day year consisting of twelve 30-day
months, the Mortgage Loans accrue interest (payable monthly in arrears)
at a fixed rate of interest on the basis of the actual number of days
elapsed over a 360 day year;
(a) 434 -- Capital Warehouse Building;
(b) 520 -- Inbus Engineering Building;
(c) 229 -- L.A. Community College;
(d) 267 -- Windscape II Apartments;
(e) 339 -- Mountain Vista Apartments;
<PAGE>
(f) 569 -- Duna Vista Mobile Home Park;
(g) 506 -- Katella/Knott Shopping Center;
(h) 626 -- A-Advance Self-Storage.
<PAGE>
EXHIBIT I-XXVII
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xxvii)
(xxvii) Except with respect to (W) transfers of certain non-controlling
interests in the Mortgagors as specified in the related Mortgage, (X)
the Mortgage Loans listed in Exhibit I-XXVII hereto, which permit one or
more transfers of the related Mortgaged Property to a person that
satisfies certain criteria (including criteria related to bankruptcy
remoteness and property management experience) specified in the related
Mortgage, (Y) the Mortgage Loans listed in paragraph 1 below, which
permit a one-time transfer of the Mortgaged Property, subject to payment
of an assumption fee and certain other conditions, and (Z) the Mortgage
Loans listed in paragraph 2 below, which permit two or more separate
transfers of the related Mortgaged Property, subject to payment of an
assumption fee and certain other conditions, the related Mortgage
contains either (A) provisions for the acceleration of the payment of
the unpaid principal balance of such Mortgage Loan if each related
Mortgaged Property, or any interest therein, is directly or indirectly
transferred or sold without the prior written consent of the mortgagee,
or (B) provisions for the acceleration of the payment of the unpaid
principal balance of such Mortgage Loan if each related Mortgaged
Property, or any interest therein, is directly or indirectly transferred
or sold without the related Mortgagor having satisfied certain
conditions specified in the related Mortgage with respect to permitted
transfers;
1. One-Time Transfers: all of the Mortgage Loans, except for the
Mortgage Loans listed in paragraph 2 below;
2. Two-Time Transfers:
(a) 543 -- Kling Street Apartments;
(b) 613 -- Ocean Villa Townhomes #3;
(c) 511 -- Ocean Villa Townhomes #1;
(d) 662 -- 325 North Howard Street.
<PAGE>
EXHIBIT I-XXIX
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xxix)
(xxix) Except as set forth in the related Mortgage File, the terms of the
related Mortgage Note and Mortgage(s) have not been waived, modified,
altered, satisfied, impaired, canceled, subordinated or rescinded in any
matter which materially interferes with the security intended to be
provided by such Mortgage;
(a) 468 --Arrow Press Properties: capital repairs in the amount of
$85,938 were due February 28, 1998; -- past due;
(b) 618 -- Brookhill Plaza: capital repairs in the amount of $55,000
were to be completed by February 28, 1998; -- past due.
<PAGE>
EXHIBIT I-XXXI
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xxxi)
(xxxi) Except for the Mortgage Loans listed below, the terms of the related
Mortgage Note or Mortgage do not provide for the release of any material
portion of the related Mortgaged Property from the lien of such Mortgage
without payment in full of the Mortgage Loan;
(a) 339 -- Mountain Vista Apartments: Partial release of collateral
permitted to complete a subdivision process that began
pre-closing. The portion released was always intended to be
released and such collateral was not included in the Seller's
underwriting analysis; and
(b) 654 -- Northpointe Apartments: Mortgagor permitted right to
elect to defease Seller's interest in the property.
<PAGE>
EXHIBIT I-XXXII
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xxxii)
(xxxii) The related Mortgagor has covenanted in the Mortgage Loan documents to
maintain the related Mortgaged Property in compliance with all
applicable laws, zoning ordinances, rules, covenants and restrictions
affecting the construction, occupancy, use and operation of such
Mortgaged Property, and the related originator performed the type of due
diligence in connection with the origination of such Mortgage Loan
customarily performed by prudent institutional commercial and
multifamily mortgage lenders with respect to the foregoing matters; the
Seller has received no notice of any material violation of any
applicable laws, zoning ordinances, rules, covenants or restrictions
affecting the construction, occupancy, use or operation of such
Mortgaged Property; to the Seller's knowledge (based on surveys and/or
title insurance obtained in connection with the origination of such
Mortgage Loan), as of the date of such origination, no
<PAGE>
improvement that was included for the purpose of determining the
appraised value of the related Mortgaged Property at the time of the
origination of such Mortgage Loan lay outside the boundaries and
building restriction lines of such property to an extent which would
have a material adverse affect on the related Mortgagor's use and
operation of such Mortgaged Property (unless affirmatively covered by
the title insurance referred to in paragraph (xii) above), and no
improvements on adjoining properties encroached upon such Mortgaged
Property to any material extent;
(a) 359 -- Americana Apartments: building encroachments onto setback
area; 1.5 foot wall from adjoining property encroachment 1.0 a
maximum of 0.3 feet onto subject property;
(b) 591-- Panorama Medical Arts Building: encroachments onto
adjoining land (distances not given on policy);
(c) 524 -- McClintock Office Plaza: building on property encroaches
0.27 feet into building setback area; wall on property
encroaches 0.53 feet onto adjacent property;
(d) 468 -- Arrow Press Properties: building encroaches onto setback
areas.
(e) 506 -- Katella/Knot Shopping Center: building encroaches .145
feet onto setback area; wall over boundary line by .095 feet;
utilities such as cable tv volts, light boxes and traffic boxes
that should be placed in the right-of-way encroach onto our
right-of-way up to 20 feet; and there are other minor
encroachments;
(f) 372 -- 3 West Carillo Building: building encroaching onto our
land based on 1922 survey;
(g) 586 -- Clifford Pacific Business Park: building encroaches on
easement; sidewalk encroaches into public right-of-way.
<PAGE>
EXHIBIT I-XXXIV
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xxxiv)
(xxxiv) With respect to at least 75% of the Mortgage Loans, the related
Mortgagor has covenanted in its organizational documents and/or the
Mortgage Loan documents to own no significant asset other that the
related Mortgaged Property or Mortgaged Properties, as applicable, and
assets incidental to its ownership and operation of such Mortgaged
Property;
<PAGE>
EXHIBIT I-XXXVI
SCHEDULE OF EXCEPTIONS
TO REPRESENTATION (xxxvi)
(xxxvi) To the Seller's actual knowledge, there are no pending actions, suits or
proceedings by or before any court or governmental authority against or
affecting the related Mortgagor or the related Mortgaged Property that,
if determined adversely to such Mortgagor or Mortgaged Property, would
materially and
<PAGE>
adversely affect the value of the Mortgaged Property or the ability of
the Mortgagor to pay principal, interest or any other amounts due under
such Mortgage Loan;
(a) 560 -- Spa Business Center: Foreclosure action Title Policy
claim tendered to the issuing title company on May 22, 1998,
with respect to potential losses in connection with an alleged
senior lien insured over by the Title Policy.
<PAGE>
EXHIBIT I-XL
Exception to Schedule I Clause (xi)
None
<PAGE>
EXHIBIT I-XLII
Exceptions to Schedule I Clause (xlii)
None
<PAGE>
EXHIBIT II-A
Exception to Schedule II Clause (i)(A)
None
<PAGE>
EXHIBIT II-B
Exception to Schedule II Clause (i)(B)
None
<PAGE>
EXHIBIT II-J
Exceptions to Section II Clause (i)(J)
None
<PAGE>
EXHIBIT II-L
Exception to Schedule II Clause (i)(L)
None
<PAGE>
Exhibit 99.4
May 28, 1998
First Union National Bank Moody's Investors Service, Inc.
First Union Capital Markets, 99 Church Street
a division of Wheat First Securities, Inc. New York, New York 10007
One First Union Center
Charlotte, North Carolina 28288-0600
Lehman Brothers Inc. Standard & Poor's Ratings Services
Three World Financial Center 25 Broadway
New York, New York 10285 New York, New York 10004
Norwest Bank Minnesota, National
Association
11000 Broken Land Parkway
Columbia, Maryland 21044-3562
First Union-Lehman Brothers-Bank of America
Commercial Mortgage Trust,
Commercial Mortgage Pass-Through Certificates, Series 1998-C2
Ladies and Gentlemen:
First Union National Bank, Lehman Brothers Holdings Inc., doing
business as Lehman Capital, a division of Lehman Brothers Holdings Inc., and
Bank of America NT&SA (the "Sellers") are transferring today to First Union
Commercial Mortgage Securities, Inc. (the "Depositor") certain multifamily and
commercial mortgage loans (the "Mortgage Loans") pursuant to separate Mortgage
Loan Purchase Agreements, dated as of May 1, 1998 (the "Mortgage Loan Purchase
Agreements"), between the Depositor and each of the Sellers. The Depositor is
issuing today Commercial Mortgage Pass-Through Certificates, Series 1998-C2, in
eighteen classes designated Class A-1, Class A-2, Class IO, Class B, Class C,
Class D, Class E, Class F, Class G, Class H, Class J, Class K, Class L, Class M,
Class N, Class R-I, Class R-II and Class R-III (collectively, the
"Certificates"), pursuant to a Pooling and Servicing Agreement, dated as of May
1, 1998 (the "Pooling and Servicing Agreement"), among the Depositor, as
depositor, First Union National Bank ("FUNB"), as master servicer (in such
capacity, the "Master Servicer"), CRIIMI MAE Services Limited Partnership, as
special servicer (in such capacity, the "Special Servicer") and Norwest Bank
Minnesota, National Association as trustee (the "Trustee"). The Depositor is
<PAGE>
selling today (i) all of the Class A-1, Class A-2, Class B, Class C, Class D,
Class E and Class IO Certificates to Lehman Brothers Inc. ("Lehman Brothers")
and First Union Capital Markets, a division of Wheat First Securities, Inc.
("First Union Capital" and, together with Lehman Brothers, in such capacity, the
"Underwriters") pursuant to an Underwriting Agreement, dated as of May 21, 1998
(the "Underwriting Agreement"), and (ii) all of the Class F, Class G, Class H,
Class J, Class K, Class L, Class M and Class N Certificates (the "Privately
Offered Certificates") to First Union Capital and Lehman Brothers (in such
capacity, the "Purchasers") pursuant to a Certificate Purchase Agreement, dated
as of May 28, 1998 (the "Certificate Purchase Agreement") between the Depositor,
as seller, and the Purchasers, as purchasers. We have acted as counsel to the
Depositor in connection with these matters and agreements. The Mortgage Loan
Purchase Agreements, the Pooling and Servicing Agreement, the Underwriting
Agreement and the Certificate Purchase Agreement are referred to collectively
herein as the "Agreements." All capitalized terms not defined herein have the
meanings set forth in the Agreements.
In rendering this opinion letter, we have examined the Agreements
and such records and other documents as we have deemed necessary. We have
assumed the conformity of the Mortgage Loans and related documents
(collectively, the "Mortgage Documents") to the requirements of the Agreements
and that there is not and will not be any other agreement among or between any
of the parties to the Agreements that modifies or otherwise supplements the
agreements of those parties as expressed in the Agreements. As to matters of
fact, we have examined and relied upon representations of the Sellers and the
Depositor contained in the Agreements and, where we have deemed appropriate,
representations or certifications of officers of the parties to the Agreements
or public officials. We have assumed the authenticity of all documents submitted
to us as originals, the genuineness of all signatures, the legal capacity of
natural persons and the conformity to the originals of all documents submitted
to us as copies. We have assumed that all parties had the corporate power and
authority to enter into and perform all obligations thereunder. As to such
parties, we also have assumed the due authorization by all requisite corporate
action, the due execution and delivery and, except with respect to the
Depositor, the enforceability of such documents.
In rendering this opinion letter, we do not express any opinion
concerning any law other than the law of the State of New York, the corporate
law of the State of Delaware and the federal law of the United States. In
addition, we do not express any opinion on any issue not expressly addressed
below.
Based upon and subject to the foregoing, we are of the opinion that:
1. Assuming compliance with all the provisions of the Pooling and
Servicing Agreement, (A) REMIC I will qualify as a real estate mortgage
investment conduit ("REMIC") within the meaning of Sections 860A through
860G of the Internal Revenue Code of 1986 and the Treasury Regulations
thereunder (the "REMIC Provisions"), and the REMIC I Regular Interests
will evidence "regular interests" and the Class R-I Certificates will
evidence the sole class of "residual interests" in REMIC I (as both terms
are defined in the REMIC Provisions in effect on the date hereof), (B)
REMIC II will qualify as a REMIC within the meaning of the REMIC
Provisions and the REMIC II Regular Interests will
-2-
<PAGE>
evidence "regular interests" and the Class R-II Certificates will evidence
the sole class of "residual interests" in REMIC II (as both terms are
defined in the REMIC Provisions in effect on the date hereof) and (C)
REMIC III will qualify as a REMIC within the meaning of the REMIC
Provisions, and the Class A-1, Class A-2, Class B, Class C, Class D, Class
E, Class F, Class G, Class H, Class J, Class K, Class L, Class M and Class
N Certificates, and each of the Components of the Class IO Certificates,
will evidence "regular interests" and the Class R-III Certificates will
evidence the sole class of "residual interests" in REMIC III (as both
terms are defined in the REMIC Provisions in effect on the date hereof).
This opinion letter is rendered for the sole benefit of each addressee
hereof, and no other person is entitled to rely hereon. Copies of this opinion
letter may not be furnished to any other person, nor may any portion of this
opinion letter be quoted, circulated or referred to in any other document.
Very truly yours,
-3-
