SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 10-K
(Mark One) |X| Annual Report pursuant to Section 13 or 15(d) of
the Securities and Exchange Act of 1934
for fiscal year ended December 31, 1998
or
|_| Transition Report pursuant to Section 13 or 15(d)
of the Securities Exchange Act 1934
for the transaction period from __________to ___________
Commission File Number: 33-97994
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FIRST UNION COMMERCIAL MORTGAGE SECURITIES, INC.
(In Respect of COMMERCIAL MORTGAGE PASS-THROUGH
-----------------------------------------------
CERTIFICATES, SERIES 1997-C1)
-----------------------------
(Exact name of registrant as specified in its charter)
Delaware 56-1643598
- --------------------------------- ---------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
One First Union Center
Charlotte, North Carolina 28228-0600
- --------------------------------- ---------------------
(Address of Principal Executive Offices) Zip Code
(704) 374-6828
--------------------------------------------------
Registrant's telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act: None.
Securities registered pursuant to Section 12(g) of the Act: None.
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Yes |X| No |_|
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
Not Applicable.
Aggregate market value of voting stock held by non-affiliates of the registrant
as of December 31, 1998.
Not Applicable.
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<PAGE>
Number of shares of common stock outstanding as of December 31, 1998.
Not Applicable.
Registrant has not been involved in bankruptcy proceedings during the proceeding
five years, and is not reporting as a corporate issuer.
The following documents are incorporated by reference into this Form 10-K.
None.
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<PAGE>
FIRST UNION COMMERCIAL MORTGAGE SECURITIES, INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1997-C1
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FORM 10-K
INDEX
<TABLE>
<CAPTION>
Page
----
<S> <C> <C> <C>
PART I.
Item 1. Business.................................................................................. 4
Item 2. Properties................................................................................. 4
Item 3. Legal Proceedings......................................................................... 5
Item 4. Submission of Matters to a Vote of Security Holders................................... 5
PART II.
Item 5. Market for Registrant's Common Equity and Related
Stockholder Matters..................................................................... 5
Item 6. Selected Financial Data................................................................... 5
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations..................................................... 5
Item 8. Financial Statements and Supplementary Data............................................... 5
Item 9. Changes In and Disagreements With Accountants on
Accounting and Financial Disclosure..................................................... 5
PART III.
Item 10. Directors and Executive Officers of the Registrant ....................................... 6
Item 11. Executive Compensation ................................................................... 6
Item 12. Security Ownership of Certain Beneficial Owners and Management ........................... 6
Item 13. Certain Relationships and Related Transactions ........................................... 6
PART IV.
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K .......................... 6
Supplemental Information to be Furnished with Reports Filed Pursuant
to Section 15(d) of the Securities Exchange Act of 1934 of Registrants
Which Have Not Registered Securities Pursuant to Section 12 of such Act.............................. 8
SIGNATURES...................................................................................................... 9
INDEX OF EXHIBITS............................................................................................... 9
</TABLE>
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<PAGE>
PART I
Item 1. Business
This Annual Report on Form 10-K is being filed on behalf of First Union
Commercial Mortgage Securities, Inc. (the "Registrant") by State Street Bank and
Trust Company, solely in its capacity as trustee under the Pooling Agreement
hereinafter identified and with respect to the Registrant's Commercial Mortgage
Pass-Through Certificates, Series 1997-C1 (the "Certificates"). The Certificates
were issued under a Pooling and Servicing Agreement dated as of May 1, 1997 (the
"Pooling Agreement") among the Registrant, as depositor, First Union National
Bank of North Carolina (the "Master Servicer"), as master servicer, Criimi Mae
Services Limited Partnership ("CMSLP"), as special servicer, and State Street
Bank and Trust Company, as trustee (in such capacity, the "Trustee"). The
Registrant has been informed that as of October 31, 1998, CMSLP has been removed
as the special servicer under the Pooling Agreement and that Banc One Mortgage
Capital Markets, LLC has been serving as the replacement special servicer under
the Pooling Agreement. Capitalized terms used herein and not otherwise defined
shall have the respective meanings ascribed to such terms in the Pooling
Agreement.
The information contained in the Annual Report on Form 10-K has been supplied to
the Trustee by third parties without independent review or investigation by the
Trustee and no representation or warranty of any kind is made by the Trustee
with respect to such information.
The information called for by this item is omitted as it is not applicable to
the Trust Fund. As used in this Annual Report on Form 10-K, "omitted" means that
the response to the referenced item is omitted in reliance on the procedures
outlined in numerous no-action letters issued by the Securities and Exchange
Commission's Staff with respect to substantially similar trusts or certificates.
Item 2. Properties
Information regarding the mortgaged properties securing the Mortgage Loans has
been set forth in the Prospectus Supplement relating to the Certificates filed
with the Commission. The Trust Fund created under the Pooling Agreement has or
will acquire title to real estate only upon default of the related mortgages
under the Mortgage Loans. The Trust Fund did not acquire any mortgage property
in connection with the foreclosure of a defaulted Mortgage Loans or otherwise.
The Annual Statement as to Compliance of First Union National Bank (formerly,
First Union National Bank of North Carolina) as Master Servicer is annexed
hereto as Exhibit 14(a)(1)(i). The Annual Servicing Report of KPMG LLP, an
independent public accountant, with respect to First Union National Bank as the
Master Servicer required to be delivered under the Pooling Agreement is annexed
hereto as Exhibit 14(a)(1)(ii).
The Annual Statement as to Compliance of CMSLP as the Special Servicer for the
period January 1, 1998 to October 30, 1998 required under the Pooling Agreement
is not available currently but will be subsequently filed with the Commission.
The Annual Servicing Report of an independent public accountant with respect to
CMSLP required to be delivered under the Pooling Agreement is not available
currently but will be subsequently filed with the Commission.
The Annual Statement as to Compliance of Banc One Mortgage Capital Markets, LLC
("BOMCM") as the Special Servicer for the period October 31, 1998 to December
31, 1998 required under the Pooling Agreement is annexed hereto as Exhibit
14(a)(1)(iii). The Annual Independent Public Accountant's Servicing Report of
PricewaterhouseCoopers LLP, an independent public accountant, with respect to
BOMCM as the Special Servicer required to be delivered under the Pooling
Agreement is annexed hereto as Exhibit 14(a)(1)(iv).
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<PAGE>
Item 3. Legal Proceedings
The Registrant knows of no material pending legal proceedings involving either
of (i) the Mortgage Properties or (ii) to the extent related to the Trust Fund,
the Registrant, the Master Servicer, CMSLP as Special Servicer, Banc One
Mortgage Capital Markets, LLC ("BOMCM") as Special Servicer, or the Trustee, in
each case, with respect to the Trust Fund other than ordinary routine
litigation, if any, incidental to the Trustee's, the Master Servicer's, each
such Special Servicer's, or the Registrant's duties under the Pooling Agreement
and not material when taken as a whole.
On October 5, 1998, CRIIMI MAE Inc. ("CRIIMI MAE"), an affiliate of CMSLP and
then holder of the "Controlling Class" of Certificates filed a petition for
reorganization under Chapter 11 of Title 11 of the United States Code (the
"Bankruptcy Code") with the United States Bankruptcy Court for the District of
Maryland. This filing led to actions by certain rating agencies affecting the
status of CMSLP as an approved servicer and thereupon, in order to allay rating
agency concerns, to action by CRIIMI MAE, as the holder of the Controlling Class
of the Certificates, to remove and replace CMSLP as Special Servicer under the
Pooling Agreement and to appoint BOMCM as the replacement Special Servicer under
the Pooling Agreement. The Registrant and the Trustee have been informed that
CMSLP continues to perform special servicing functions as sub-special servicer
from BOMCM. To the knowledge of the Registrant and the Trustee, CMSLP did not
file for protection under Chapter 11 or any other Chapter of the Bankruptcy
Code.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote or consent of the holders of the
Certificates during the period covered by this report.
PART II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters
Presently, there is no established trading market for the Certificates known to
the Registrant. As of December 31, 1998, there are an aggregate of two (2)
holders of all Classes of the Registrant's Commercial Mortgage Pass-Through
Certificates Series, 1997-C1.
Information as to distributions to Certificateholders have been provided in the
Registrant's monthly Form 8-K filings with respect to the Certificates.
Item 6. Selected Financial Data
Omitted.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Omitted.
Item 8. Financial Statements and Supplementary Data
Omitted.
Item 9. Changes In and Disagreements with Accountants on Accounting and
Financial Disclosure
The Registrant knows of no changes or disagreements with accountants on
accounting and financial disclosure
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<PAGE>
with respect to the Trust Fund or the Certificates.
Item 10. Directors and Executive Officers of the Registrant
Omitted.
Item 11. Executive Compensation
Omitted.
PART III
Item 12. Security Ownership of Certain Beneficial Owners and Management
(a) The Registrant is responding to this item by providing information with
respect to the security ownership of certain owners of the Certificates, which
information is annexed hereto as Exhibit 99.1.
(b) Omitted.
(c) As of December 31, 1998 and March 29, 1999, the Class K Certificates
constitute the "Controlling Class" of Certificates within the meaning and
bearing the rights and limitations set forth in the Pooling Agreement, including
without limitation the right to designate an entity to serve as special servicer
under the Pooling Agreement and to advise the special servicer with respect to
certain actions enumerated in the Pooling Agreement. Reference is hereby made in
all respects to the Pooling Agreement for a complete description of the rights
and limitations of the Controlling Class. The Registrant has been informed that
the records of the Trustee reflect that to May 18, 1998, the registered holder
of the Class K Certificates was CRIIMI MAE and that on May 18, 1998, record
ownership of the Class K Certificates was transferred from CRIIMI MAE to LaSalle
National Bank as Trustee for Criimi Mae Series 1998-C1.
Item 13. Certain Relationships and Related Transactions
The Registrant has been informed that from January 1, 1998 to May 18, 1998,
CRIIMI MAE was the sole registered owner of the Registrant's Class J
Certificates having an outstanding principal amount of $13,054,483 and the
Registrant's Class K Certificates having an outstanding principal amount of
$26,108,964 (representing in the aggregate 3% of all the Certificates). Criimi
Mae Services Limited Partnership ("CMSLP"), an affiliate of CRIIMI MAE, served
as the designated Special Servicer under the Pooling Agreement until October 30,
1998. The Special Servicer under the Pooling Agreement is entitled to a fee,
with respect to each Specially Serviced Mortgage Loan and each REO Loan, of 25%
per annum. In 1998, CMSLP received $591,147.04 for its services as Special
Servicer. The Registrant has been further informed that on May 18, 1998, record
ownership of the Class J and Class K Certificates was transferred to LaSalle
National Bank as Trustee for Criimi Mae Series 1998-C1. CRIIMI MAE, as the
holder of the Controlling Class of Certificates, removed and replaced CMSLP as
special servicer. CMSLP currently acts as the sub-servicer of specially serviced
Mortgage Loans for BOMCM. See "Legal Proceedings".
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a)(1) Financial Statements
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<PAGE>
(i) The Statement as to Compliance to be delivered by First Union
National Bank as master servicer under the Pooling Agreement is annexed
hereto as Exhibit 14(a)(1)(i).
(ii) The Annual Servicing Report of an independent public accountant
relating to master servicing by First Union National Bank is annexed
hereto as Exhibit 14(a)(1)(ii).
(iii) The Statement as to Compliance to be delivered by Criimi Mae
Services Limited Partnership as special servicer under the Pooling
Agreement for the period from June 1, 1998 through October 30, 1998:
Has not yet been delivered and will be subsequently filed with the
Commission.
(iv) The Annual Servicing Report of an independent public accountant
on behalf of Criimi Mae Services Limited Partnership for the period from
June 1, 1998 through October 30, 1998:
Has not yet been delivered and will be subsequently filed with the
Commission.
(v) The Annual Statement as to Compliance by Banc One Mortgage
Capital Markets, LLC for the period from October 31, 1998 through December
31, 1998 required pursuant to the Pooling Agreement is annexed hereto as
Exhibit 14(a)(iii).
(vi) The Annual Independent Accountant's Servicing Report of
PricewaterhouseCoopers, LLP from an independent public accountant, with
respect to Banc One Mortgage Capital Markets, LLC as special servicer for
the period from October 31, 1998 through December 31, 1998 is annexed
hereto as Exhibit 14(a)(1)(iv).
(a)(2) Financial Statement Schedules
Omitted.
(a)(3) Exhibits
Unless otherwise indicated, the following exhibits required by Item 601 of
Regulation S-K and previously furnished to the Commission as exhibits to a
Report on Form 8-K, are incorporated into this Form 10-K by reference:
4. Pooling and Servicing Agreement dated as of May 1, 1997, by
and among First Union Commercial Mortgage Securities, Inc., as
depositor, First Union National Bank of North Carolina as
master servicer, Criimi Mae Services Limited Partnership as
special servicer, and State Street Bank and Trust Company, as
Trustee.
99.1* Security Ownership of Certain Beneficial Owners.
(b) The following Reports on Form 8-K were filed with the Commission by
or on behalf of the Registrant with respect to the Certificates
during the last quarter of the period covered by this report:
Report on Form 8-K dated October 22, 1998, reporting items 5 and 7.
Report on Form 8-K dated November 17, 1998, reporting items 5 and 7.
-7-
<PAGE>
Report on Form 8-K dated December 4, 1998, reporting items 5 and 7.
- ------------------
* Filed herewith
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 OF REGISTRANTS WHICH HAVE NOT
REGISTERED SECURITIES PURSUANT TO SECTION 12 OF SUCH ACT.
The Registrant has not sent an annual report or proxy material to the holders of
its Certificates. The Registrant will not be sending an annual report or proxy
materials to the holders of its Certificates subsequent to the filing of this
Form 10-K.
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<PAGE>
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, thereunto duly authorized.
FIRST UNION COMMERCIAL MORTGAGE
SECURITIES, INC.
Dated: April 14, 1998 By: State Street Bank and Trust Company,
solely in its capacity as Trustee of the Trust
Fund for the Registrant's Commercial Mortgage
Pass-Through Certificates, Series 1997-C1 and
not individually on behalf of the Registrant
By: /s/ David Shepherd
----------------------------------------------
David Shepherd, Assistant Secretary
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<PAGE>
INDEX OF EXHIBITS
DESCRIPTION
14(a)(1)(i) Annual Statement as to Compliance by First Union National Bank
as master servicer.
14(a)(1)(ii) Annual Independent Accountant's Report of KPMG LLP, an
independent public accountant, with respect to master servicing
by First Union National Bank.
14(a)(1)(iii) Annual Statement as to Compliance by Banc One Mortgage Capital
Markets, LLC, as special servicer.
14(a)(1)(iv) Annual Independent Accountant's Servicing Report of
PricewaterhouseCoopers LLP, with respect to special servicing
by Banc One Mortgage Capital Markets, LLC.
99.1 Security Ownership of Certain Beneficial Owners (with original
principal balances).
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EXHIBIT 14(a)(1)(i)
FIRST UNION NATIONAL BANK
NC 1075
Structured Products Servicing
201 South College Street
Charlotte Plaza - Floor 23
Charlotte, NC 28288-1075
OFFICER'S CERTIFICATE
Reference is hereby made to that certain Pooling and Servicing Agreement
dated as of May 1, 1997 by and among First Union Commercial Mortgage Securities,
Inc. as Depositor, First Union National Bank as Master Servicer (the "Master
Servicer"), CRIIMI MAE Services Limited Partnership as Special Servicer, and
State Street Bank and Trust Company as Trustee, with respect to Commercial
Mortgage Pass-Through Certificates, Series 1997-C1 (the "Agreement").
Capitalized terms used herein not otherwise defined shall have the meanings
assigned in the Agreement.
Pursuant to Section 3.13 of this Agreement, Timothy S. Ryan and Timothy E.
Steward, Vice Presidents of the Master Servicer, do hereby certify that:
1. A review of the activities of the Master Servicer during the period
from January 1, 1998 through December 31, 1998 and of performance
under the Agreement during such period has been made under our
supervision; and
2. To the best of our knowledge, based on such review, the Master
Servicer has fulfilled all its obligations under the Agreement in
all material respects throughout the period January 1, 1998 through
December 31, 1998; and
3. The Master Servicer has received no notice regarding qualification,
or challenging the status of any portion of the Trust Fund as a
REMIC from the Internal Revenue Service or any other governmental
agency or body.
IN WITNESS WHEREOF, the undersigned have executed this Certificate as of
the 26th day of March, 1999.
/s/ Timothy S. Ryan /s/ Timothy E. Steward
------------------------------- ----------------------------------
Timothy S. Ryan, Vice President Timothy E. Steward, Vice President
First Union National Bank First Union National Bank
EXHIBIT 14(a)(1)(ii)
Page 1 of 2
[KPMG LOGO]
Suite 2800
Two First Union Center
Charlotte, NC 28282-8290
Independent Accountants' Report
The Board of Directors
First Union National Bank:
We have examined management's assertion about First Union National Bank's
Commercial Loan Servicing Division's (the Bank) compliance with the minimum
servicing standards set forth in the Mortgage Bankers Association of America's
(MBA's) Uniform Single Attestation Program for Mortgage Bankers (USAP), except
for minimum servicing standards V.4. and VI.1., which the MBA has interpreted as
being inapplicable to the servicing of commercial and multifamily loans, as of
and for the year ended December 31, 1998 included in the accompanying management
assertion. Management is responsible for the Bank's compliance with those
minimum servicing standards. Our responsibility is to express an opinion on
management's assertion about the Bank's compliance based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly, included
examining, on a test basis, evidence about the Bank's compliance with the
applicable minimum servicing standards and performing such other procedures as
we considered necessary in the circumstances. We believe that our examination
provides a reasonable basis for our opinion. Our examination does not provide a
legal determination on the Bank's compliance with the applicable minimum
servicing standards.
In our opinion, management's assertion that the Bank has complied in all
material respects with the aforementioned applicable minimum servicing standards
as of and for the year ended December 31, 1998 is fairly stated, in all material
respects.
/s/ KPMG LLP
March 8, 1999
<PAGE>
Page 2 of 2
First Union National Bank
NC0121
Structured Products Servicing
Charlotte Plaza, Floor 23
201 South College Street
Charlotte, North Carolina 29288-0121
704 374-2487
Fax 704 383-9862
MANAGEMENT'S ASSERTION
As of and for the year ended December 31, 1998, First Union National Bank's
Commercial Loan Servicing Division (the Bank) has complied in all material
respects with the minimum servicing standards set forth in the Mortgage Bankers
Association of America's (MBA's) Uniform Single Attestation Program for Mortgage
Bankers (USAP), except for minimum servicing standards V.4. and VI.1., which the
MBA has interpreted as being inapplicable to the servicing of commercial and
multifamily loans. As of and for the same periods, the Bank had in effect
fidelity bond and errors and omissions policies in the amount of $200 million
and $20 million, respectively.
/s/ Timothy S. Ryan March 8, 1999
----------------------------- -------------
Timothy S. Ryan Date
Vice President
/s/ John M. Church March 8, 1999
----------------------------- -------------
John M. Church Date
Senior Vice President
EXHIBIT 14(a)(1)(iii)
Page 1 of 1
BANC ONE MORTGAGE
CAPITAL MARKETS, LLC
Paul Smyth
1717 Main Street, 12th Floor
Dallas, Texas 75201
Telephone: (214) 290-2505
Facsimile: (214) 290-3142
April 1, 1999
State Street Bank and Trust Company
Corporate Trust Department
Two International Place, 5th Floor
Boston, MA 02110
Attn: First Union-Lehman Brothers Commercial Mortgage Trust, Commercial Mortgage
Pass Through Certificates, Series 1997-C1
First Union National Bank of North Carolina
First Union Capital Markets Group
One First Union Center, TW9
301 South College Street
Charlotte, NC 28288
Attn: First Union-Lehman Brothers, Commercial Mortgage Pass Through
Certificates, Series 1997-C1
Re: First Union Commercial Mortgage Securities Commercial Mortgage Pass
Through Certificates, Series 1997-C1
Ladies and Gentlemen:
The Officer's Certificate is provided to you by BANC ONE MORTGAGE CAPITAL
MARKETS, LLC ("BOMCM") pursuant to Section 3.13 of that certain Pooling and
Servicing Agreement ("PSA") dated as May 1, 1997, relative to the above
referenced securitization for which BOMCM acts as Special Servicer. Capitalized
terms used herein shall bear the meaning ascribed to them in the PSA unless
otherwise defined in this letter.
The undersigned officers, on behalf of BOMCM, hereby inform you (i) that, a
review of the activities of BOMCM as Special Servicer and of its performance
under the PSA has been made under the undersigneds' supervision for the period
of time commencing October 31, 1998 through year end 1998, (ii) that, to the
best of such undersigneds' knowledge, based on such review, it has fulfilled all
of its obligations under the PSA, throughout such period, (iii) that, the
undersigneds have received no notice regarding qualification, nor challenging
the status of, the Upper-Tier REMIC or Lower-Tier REMIC as a REMIC from the IRS
or any other governmental body.
Sincerely,
BANC ONE MORTGAGE
CAPITAL MARKETS, LLC, Special Servicer
By: /s/ Paul Smyth By: /s/ Edgar L. Smith, II
--------------------------- ------------------------
Paul Smyth Edgar L. Smith, II
Managing Director Servicing Chief Operating Officer
EXHIBIT 14(a)(1)(iv)
Page 1 of 2
PRICEWATERHOUSECOOPERS
PricewaterhouseCoopers LLP
2001 Ross Avenue, Suite 1800
Dallas, TX 75201-2997
Telephone (214) 754-7900
Independent Accountant's Report
To Banc One Mortgage Capital Markets, LLC:
We have examined management's assertion about Banc One Mortgage Capital Markets
LLC's ("BOMCM") compliance with the minimum servicing standards identified in
the Mortgage Bankers Association of America's Uniform Single Attestation Program
for Mortgage Bankers ("USAP") (except for commercial loan and multifamily loan
servicing for which minimum servicing standards V.4 and VI.1, are inapplicable
to such servicing according to the Mortgage Bankers Association) as of and for
the year ended December 31, 1998 included in the accompanying management
assertion. Management is responsible for BOMCM's compliance with those minimum
servicing standards. Our responsibility is to express an opinion on management's
assertion about the entity's compliance based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly, included
examining. on a test basis, evidence about BOMCM's compliance with the minimum
servicing standards and performing such other procedures as we considered
necessary in the circumstances. We believe that our examination provides a
reasonable basis for our opinion. Our examination does not provide a legal
determination on BOMCM's compliance with the minimum servicing standards.
In our opinion, management's assertion that BOMCM complied with the
aforementioned minimum servicing standards as of and for the year ended December
31, 1998 is fairly stated, in all material respects.
/s/ PricewaterhouseCoopers LLP
Dallas, Texas
February 22, 1999
<PAGE>
Page 2 of 2
BANC ONE MORTGAGE Tel. 800-887-6781
CAPITAL MARKETS, LLC www.bomcm.com
TXI-2498
1717 Main Street, Suite 1400
Dallas, Texas 75201
[BANC ONE LOGO]
February 22, 1999
PricewaterhouseCoopers
2001 Ross Avenue
Suite 1800
Dallas, Texas 75201-2997
As of and for the year ended December 31, 1998, Banc One Mortgage Capital
Markets, LLC ("BOMCM") has complied in all material respects with the minimum
servicing standards set forth in the Mortgage Bankers Association of America's
Uniform Single Attestation Program for Mortgage Bankers ("USAP") (except, for
commercial loan and multifamily loan servicing, minimum servicing standards V.4
and VI.1., which the MBA has interpreted as inapplicable to such servicing.) As
of and for this same period, BOMCM had in effect a fidelity bond and errors and
omissions policy in the amount of $25 million.
/s/ Edgar L. Smith, II
Edgar L. Smith, II
Chief Operating Officer
EXHIBIT 99.1
PAGE 1 OF 2
FIRST UNION COMMERCIAL MORTGAGE SECURITIES, INC.
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 1997-C1
ITEM 12. Security Ownership of Certain Beneficial Owners
As of December 31, 1998, the following persons were known to the Registrant to
be the registered beneficial owners of more than 5% of the aggregate fractional
undivided interest evidenced by each Class of the Certificates referenced below:
<TABLE>
<CAPTION>
TITLE NAME AND ADDRESS AMOUNT OF BENEFICIAL
OF CLASS OF HOLDERS OF RECORD OWNERSHIP (ORIGINAL PRINCIPAL) % CLASS
-------- -------------------- ------------------------------ -------
<S> <C> <C> <C>
Class A-1 Cede & Co. $200,000,000.00 100%
55 Water Street
New York, New York 10041
Class A-2 Cede & Co. $318,000,000.00 100%
55 Water Street
New York, New York 10041
Class A-3 Cede & Co. $395,812,000.00 100%
55 Water Street
New York, New York 10041
Class B Cede & Co. $78,327,000.00 100%
55 Water Street
New York, New York 10041
Class C Cede & Co. $71,800,000.00 100%
55 Water Street
New York, New York 10041
Class D Cede & Co. $71,582,000.00 100%
55 Water Street
New York, New York 10041
Class E Cede & Co. $19,582,000.00 100%
55 Water Street
New York, New York 10041
Class F Cede & Co. 71,800,000.00 100%
55 Water Street
New York, New York 10041
</TABLE>
<PAGE>
EXHIBIT 99.1
PAGE 2 OF 2
<TABLE>
<CAPTION>
TITLE NAME AND ADDRESS AMOUNT OF BENEFICIAL
OF CLASS OF HOLDERS OF RECORD OWNERSHIP (ORIGINAL PRINCIPAL) % CLASS
-------- -------------------- ------------------------------ -------
<S> <C> <C> <C>
Class G LaSalle National Bank, as Trustee $13,054,813.00 100%
Criimi Mae Series 1998-C1
Att: Asset Backed Sec. Trust Services
135 S. LaSalle Street, Suite 1625
Chicago, Illinois 60674
Class H LaSalle National Bank, as Trustee $26,108,964.00 100%
Criimi Mae Series 1998-C1
Att: Asset Backed Sec. Trust Services
135 S. LaSalle Street, Suite 1625
Chicago, Illinois 60674
Class IO Cede & Co. $1,305,448,224.00 100%
55 Water Street
New York, New York 10041
Class J LaSalle National Bank, as Trustee $13,054,483.00 100%
Criimi Mae Series 1998-C1
Att: Asset Backed Sec. Trust Services
135 S. LaSalle Street, Suite 1625
Chicago, Illinois 60674
Class K LaSalle National Bank, as Trustee $26,108,964.00 100%
Criimi Mae Series 1998-C1
Att: Asset Backed Sec. Trust Services
135 S. LaSalle Street, Suite 1625
Chicago, Illinois 60674
Class R-I Cede & Co. -0- 100%
55 Water Street
New York, New York 10041
Class R-II Cede & Co. -0- 100%
55 Water Street
New York, New York 10041
Class R-III Cede & Co. -0- 100%
55 Water Street
New York, New York 10041
</TABLE>
